Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Co-ordinated Industrial Organisations - Committee of Inquiry - Report


Download PDF Download PDF

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

1974 — Parliamentary Paper No. 220

REPORT OF THE COMMITTEE OF INQUIRY ON CO-ORDINATED INDUSTRIAL ORGANISATIONS

T he H onourable John Bernard Sweeney

Judge o f the Australian Industrial Court

Presented by Command 1 August 1974

Ordered to be printed 3 October 1974

TH E G O V ER N M EN T PR IN T ER OF A U STR A LIA CA NB ERR A 1975

Printed by Advocate Press Pty Ltd, Melbourne

Contents

v Introduction

1 Description of Arbitration Systems and Registration methods

4 Effects of registration systems on Federal branches

6 Multiple incorporation

7 The problems resulting from multiple incorporation

9 Questions of constitutional validity

20 The desirability of continuing the present system of dual incorporation

28 Solution proposed to the present problems

33 Machinery provisions to implement such a system

38 The curing of invalidities, etc.

43 Summary of report

47 Schedule ‘A’

49 Schedule ‘B’

50 Schedule ‘C’: Draft amendments to the Conciliation and Arbitration Act, 1904-1973

55 Schedule ‘D’: Draft amendments

Introduction

1· As a result of the judgment in Moore v. Doyle, 15 F.L.R. 59, there was eventually established a Working Party consisting of representatives of the Aus­ tralian Department of Labor, the Attorney-General’s Department, the Depart­ ments of Labour of the States of Queensland, New South Wales, South Australia

and Western Australia, the A.C.T.U. and the Australian Council of Employers' Federations. This Committee met between September 1970 and November 1972 to consider the problems raised by the judgment.

A report was issued in February 1974. While agreement was not reached, the views of the Departments as recorded in the report have been carefully considered by the Committee.

However no agreement as to the appropriate legislative changes was reached.

2. By letter dated 7 February 1974 the Attorney-General of Australia requested that I undertake an Inquiry.

The terms of reference of the Inquiry were as follows:

‘The Committee will inquire into— a. The desirability of a system of organisation and/or registration of employee and employer organisations which would enable the one body to represent in terms of legal personality, structure, organisation and otherwise its members in both Aus­

tralian and State arbitration systems. b. Means by which such a system if desirable may be achieved. c. The systems of registration of organisations of employees and employers under the Australian Conciliation and Arbitration Act and of trade or industrial unions and

associations under statutes providing for conciliation and arbitration in the States and the effects of such systems on the operations of these bodies and their branches. d. Problems and difficulties arising from the fact of registration under one or more of

such systems and the operation thereunder of the same group of members of employer and employee organisations and steps appropriate to be taken. The Committee will conduct its inquiries with a view to recommending such action as is necessary and desirable in the light of its inquiry so as to enable the efficient functioning of employer and employee organisations under systems of Australian and State conciliation and arbitration and the efficient functioning of such systems."

M r R. E. McGarvie, Q.C. and Mr K. D. Marks were briefed to assist me and Mr J. P. Gallagher was appointed Secretary to the Committee.

Thereafter a notice was inserted throughout the metropolitan daily press advising of the appointment and of the terms of reference. All bodies and persons interested were invited to make submissions.

Preliminary hearings took place in Melbourne on 22 February 1974 and 4 March 1974. I suggested at them and all represented agreed, that visits should be paid to

vi Introduction

the four States particularly concerned and that on those visits discussions would take place with representatives of the various Departments of Labour, members of the tribunals operating under the respective arbitration Acts and representatives of organisations of employers and employees.

Thereafter the Committee visited each of the four States concerned and had discussions with the bodies indicated on the list, Schedule ‘A ’ hereto.

On 30 April 1974 a statement was issued by the Committee and forwarded to all those bodies which had made submissions or taken part in discussions or which appeared likely to be affected.

Further sittings were held in Sydney during the week commencing 13 May 1974 and in Melbourne during the weeks commencing 20 May 1974 and 27 May 1974, when oral submissions were made to the Committee. The final sittings of the Committee were held in Sydney on 18 and 19 June 1974.

In addition, after the statement of 30 April 1974 had been issued, some further written submissions were received.

Written submissions were received from those persons and organisations set out in Schedule Έ ’ hereto.

3. I desire to express my gratitude to all those who have taken part in the discussions and/or have forwarded submissions. They represent a very wide body of interested organisations and governmental representatives and I have found the submissions and discussions of very great value in my task.

I also desire to express my thanks to Counsel assisting me and to Mr Gallagher, the Secretary of the Committe, for their assistance.

1

Description of Arbitration Systems and Registration methods

1. In Australia there necessarily exists more than one system of dealing with industrial disputes. This need arises from the Constitution which enables the Aus­ tralian Parliament to make laws with respect to conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State.

With this power thus limited, the States have developed their own systems of conciliation and arbitration.

Generally speaking the States have one of two kinds of systems.

The first is fundamentally a form of collective bargaining by the establishment of Wages Boards, as in Victoria and Tasmania; the second a basically litigious system between parties, as in the other four States.

2. Where a litigious system exists, it has long been recognised as necessary to have permanent representative bodies of employers and employees. So each of the State systems which provides for a system of conciliation and arbitration also provides a system of registration and incorporation of representative bodies to

function as part of the conciliation and arbitration system. In some cases, e.g. New South Wales and Queensland, these are superimposed on Trade Union Acts, which are basically the same as the English Trade Union Act of 1876.

3. In the States of Victoria and Tasmania there exist Trade Union Acts. There are now few bodies registered under them.

The Government of each of these States has taken the view that since registra­ tion under these Acts is not required for the functioning of the Wages Board systems, problems such as those which have arisen in other States do not arise in Victoria and Tasmania. No other submission was made to the Committee.

4. In the other States, the conciliation and arbitration legislation provides for the registration of representative bodies of employers and employees and only such registered bodies are able to take part in proceedings before the State industrial authority.

5. This is what has been done by the respective legislatures to create repre­ sentative bodies in the various State Statutes:

(a) New South Wales Provision is made for registration under the Trade Union Act and for a regis­ tered trade union to be registered as an industrial union of employees under the Industrial Arbitration Act, 1940 (Section 8).

Provision is also made for registration of an association of employers as an

2 Description of arbitration systems and registration methods

industrial union of employers under that Act (Section 6). There is no incorporation in terms.

(b) Queensland A registered industrial union on registration is incorporated (Industrial Con­ ciliation and Arbitration Act, Section 69). It has perpetual succession, a common seal, may hold property real and personal and may sue and be sued.

(c) South Australia Under the Industrial Conciliation and Arbitration Act, 1972 a registered asso­ ciation becomes a body corporate (Section 138 and Section 139) with perpetual succession and a common seal. It may sue and be sued in its corporate name and purchase and hold real or personal property (Section 140).

(d) Western Australia The Industrial Arbitration Act, 1912-1973 provides for the registration of societies of employers and of employees and for trade unions to be registered as industrial unions (Section 13 and Section 16). Upon registration each

becomes a corporation (Section 13 and Section 17) having perpetual succes­ sion and a common seal. It may sue and be sued and may own and hold real or personal property.

(e) Conciliation and Arbitration Act, 1904-1973 (hereinafter called the Act) Under this Act, associations of employers or employees may be registered as organisations (Section 132). Upon registration, the organisation becomes a corporation with perpetual succession, a common seal and may sue and be

sued and may purchase and deal with any real or personal property (Section 136).

6. Types of organisations registered under State Statutes.

These fall within three convenient groups:

(a) Unions of employees which are composed of persons who are not employees constitutionally able to be involved in an industrial dispute within the meaning of the phrase as used in the Constitution. Examples of such employees are teachers in Government schools (Federated State School Teachers’ Association of Australia v. State of Victoria and Others 41 C.L.R. 569), employees of Fire Brigades (Pitfield v Franki 132 C.L.R. 448).

(b) Unions of employers or employees concerned with activities in one State only. There are numbers of such unions in various States which have no formal connection with federally registered bodies.

(c) State registered bodies which are part of or connected with federally registered organisations. There exist in each State bodies both of employers and em­ ployees which are registered under the State Act and have varying degrees of association with a federally registered organisation. The position varies from State to State and sometimes within States. In some cases such a body obtained registration within the State jurisdiction and later sought to become part of a nationally functioning organisation which obtained federal registration. In other

cases the federal organisation obtained federal registration and later set up

3

branches within the States which in their turn sought and obtained registration under State industrial legislation. In other cases still a federal body having obtained federal registration and having a branch within a particular State has set up a shadow body within that State which in its turn obtains registration

under State law. Examples of each of these have been given to me.

Description of arbitration systems and registration methods

4

Effects of registration systems on Federal branches

1. I turn then to consider the effects of the various provisions.

In the case of those unions which are purely one State unions, no problems in the nature of the difficulties disclosed in Moore v Doyle arise (see below) and in this part of the report I deal no further with these.

2. It appears that there are 155 organisations of employees registered under the Act. Of these, 117 have branches in various States and the big majority of these have branches which are registered and function as unions under State Acts. A few have set up the shadow bodies referred to and a few take no part in State industrial arbitration systems.

There are 81 organisations of employers registered and of these, 8 have branches in various States, most of which are registered and function as industrial unions under State Acts.

In New South Wales something over 50 unions registered under the New South Wales Act also function as branches of federal organisations. In addition, there are some which are ‘shadow bodies’ and in one case it appears that an organisation registered under the Act is also registered as an industrial union.

3. In some States the legislation purports to allow the registration under State law of a branch of a federally registered organisation.

This is so in Queensland, South Australia and Western Australia.

In the Queensland Act, Section 75 clearly contemplates that branches of federally registered organisations may be registered as industrial unions under that Act and so the branch may become a corporation.

In the South Australian Act, Part IX and particularly Section 116 so provide in terms. In the Western Australian Act provision is made for registration of a trade union and by Section 15(4) a trade union is defined as follows:

‘For the purposes of this section “trade union" includes a branch of a trade union and also a branch of any society in the nature of a trade union duly registered under the law of any part of the King’s Dominions outside the State.’

This would seem to include a branch of a federally registered organisation. Sub­ missions made to the Committee by the Governments of Queensland, South Aus­ tralia and Western Australia make it clear that under their respective State Acts branches of federal unions are registered.

4. In New South Wales the position is less clear. In Brailey’s Case (Brailey v Sydney Branch Waterside Workers' Federation of Australia 1936 N.S.W.A.R. 205) the Waterside Workers’ Federation of Australia was registered under the Act

Effects of registration systems on Federal branches 5

in 1907 and in the same year a branch was formed in Sydney. That branch obtained registration as a trade union and then as an industrial union in 1925.

A Full Bench of the Industrial Commission held that ‘the branch of the organ­ isation (federal body) and the trade union (State body) were entirely separate and distinct legal entities, even on the 2 November 1925 when the branch of the organ­ isation registered itself as a trade union’.

This view was followed by the Commission in subsequent cases (e.g. Lasbies v McKay 1945 N.S.W.A.R. 562; McQuillan v Bodkin 1960 N.S.W.A.R. 373). with the clarification that the federal body and not its branch was a corporation.

These would seem to contemplate that a branch of a federal organisation may be registered as a trade union and industrial union but that on such registration two separate and distinct legal entities emerged.

Later in the case of Benson v E.TXJ. 1962 N.S.W.A.R. 516 a Full Bench of the Commission with the advantage of the High Court’s judgment in Hursey’s Case expressed doubts whether a branch of a federally registered organisation could be registered as an industrial union but found it unnecessary to reach a final conclusion

on the point.

In Moore v Doyle the Commonwealth Industrial Court expressed preference for the view that a New South Wales registered trade and industrial union is a separate legal entity (page 116) and said at page 121:

‘The Trade Union and Industrial Arbitration Acts of some of the States appear to proceed on the basis that the State trade union and/or industrial union is an autonomous body corporate or separate legal entity not under control of bodies outside itself, whereas the State registered body is usually treated as being part of

a federal organisation and is, in fact, subject to control by a federal council or committee of management.’

Similar questions came before the Queensland Supreme Court in Allingham v Australian Workers’ Union (1972 Q.S.R. 218). In that case the facts were that the Australian Workers’ Union (A.W.U.) had become registered as an organisation under the federal Act in 1905. It then had a branch in Queensland. In 1916 that

branch became registered as a trade union under the Queensland Trade Union Act which conferred corporate status on it. That trade union then obtained registration under the Queensland Industrial Arbitration Act, 1915 which in terms incorporated a registered industrial union.

There resulted, His Honour held, three legal entities: the federally registered A.W.U., the trade union and the industrial union. In the result it was held that an application by a person to join the Australian Workers’ Union conferred upon him membership in all three bodies.

5. Registration under the State Act is in each case necessary to enable participation in the form of industrial regulation which exists under the Acts of Queensland, New South Wales, South Australia and Western Australia. In each case it is in normal practice only a registered body of employees which seeks an award

or enters into an industrial agreement or effectively enforces either. In the South Australian Act, Section 30 allows applications to be made by twenty employees and in the Western Australian Act where there is no registered union, an application may be made by a person on behalf of employees.

These are however exceptional cases and rarely used.

6

Multiple incorporation

1. Assuming the validity of registration, there may then exist in the par­ ticular State a group of employees or employers which will be:

(a) part of a corporation under the Act as a branch of the federal organisation.

(b) a corporation under State law as a union registered under the State Arbitration Act.

(c) perhaps in those States such as New South Wales and Queensland where regis­ tration under the Trade Union Act is necessary or may be obtained before registration under an Arbitration Act a corporation constituted under that Act.

2. Registration in each case under State laws requires provision for a rule­ making body, for membership, joining of members, for meetings, for elections and for the resignation of members. In addition, registration clearly contemplates the holding of funds by the registered body and the payment of subscriptions or fees. In each it clearly contemplates the registered union having individual members. In some cases awards and in all cases industrial agreements are binding on persons members of the registered union specified in the award or a party to the agreement. Similar requirements arise under the Act.

3. There will thus be in existence the one group of employers and em­

ployees who will constitute two or in some cases three legal entities and will be subject to rules specifying the matters referred to above.

7

The problems resulting from multiple incorporation

1- The judgment of the Commonwealth Industrial Court in Moore v Doyle 15 F.L.R. 59 at 119 dealt with the problems which then arise:

‘This case illustrates the serious problem confronting many federal organisations and trade unions because of the existence of the separate Commonwealth and State arbitration systems and the need of organisations and unions to be able to function

in both systems. At the time of the enactment of the Commonwealth Conciliation and Arbitration Act in 1904 there were already in existence many trade unions registered under the various State Trade Union Acts and in some States those trade unions were also registered as industrial unions. After the enactment of the Com­ monwealth Act many of these State-registered bodies, covering the same or substan­ tially the same callings in different States, sought to amalgamate or come together as federal organisations registered under the Commonwealth Act. In other cases a federal organisation was first registered and State branches of that organisation sought

and obtained registration under State Trade Union Acts and Industrial Arbitration Acts.

The cases in both State and federal jurisdictions and the rules of many organisations and trade unions show that the constitutions of the federal and the corresponding State body often differ to some extent so that membership of the trade union and the State branch of a federal organisation, if full use is made of the range of eligibility,

must be different. The cases also show that the rules of the federal organisation and the corresponding State trade union each provide for a contribution fee but in all or almost all cases only one fee is collected and this is treated as satisfying the require­

ments of membership in both the federal and the corresponding State-registered body. Very frequently the rules of the federal organisation and of the trade union on other matters are different from and inconsistent with one another and often the rules require different offices to be filled in the State branch of the federal organisa­

tion and in the trade union.

In the great majority of cases the trade union and the branch of the federal organisa­ tion are administered as though they were the same body with one set of assets, one system of banking, one set of books, one register of members, one set of officers, one election of officers for both bodies, and one system of meetings of a committee of

management to handle the affairs of the trade union and the State branch of the organisation. Despite differences in the constitution rule of the federal and the corresponding State body, members of one who are not eligible to be members of the other are often treated as members of both and often vote in elections of the body to which they are not entitled to belong. Generally one application form is filled in

and this sometimes satisfies the provisions of rules of the organisation and the trade union, but often there are different rules as to applications. Sometimes, as the cases show, the real and effectively-operating body is the State branch of the federal organisation with the corresponding trade union existing as a mere fiction and it has

occurred that a trade union has been held to be non-existent and liable to be deregistered by the State authorities. In other cases it is the trade union which is the living body and the State branch of the federal organisation may be a shadow or fiction having no real existence. In yet other cases the affairs of the State branch of a

8 The problems resulting from multiple incorporation

federal organisation and of the corresponding trade union are administered under some practically-evolved set of rules which are an administrative amalgam of the registered rules of the State branch and the trade union but are not the actual rules of either.

The Trade Union and Industrial Arbitration Acts of some of the States appear to proceed upon the basis that the State trade union and/or industrial union is an autonomous body corporate or separate legal entity not under control of bodies outside itself, whereas the State-registered body is usually treated as being part of a

federal organisation and is, in fact, subject to control by a federal council or committee of management.................

................. Cases referred to earlier in this judgment are further illustrations of the web of problems and technicalities which have developed in the system of trade union organisation in Australia .................

................. The above cases and the present case show that when factional differ­ ences arise in trade unions, or when it suits the interest of some litigant or litigants to do so, the federal or State body can be attacked and its valid operation, its entitlement to assets, funds and membership, imperilled. Furthermore the validity of membership in one body or the other may be difficult to establish in cases in which membership has to be proved as a condition of exercising jurisdiction or to qualify or

enable a person to be or to be made a party in legal proceedings. The system as required to exist by State and federal legislation and as it has evolved under that legislation in practice is technical, productive of artificialities and in urgent need of the attention

of the law reform er.................

................. A system of trade union organisation is urgently needed which would enable the one body to represent its relevant members in both the federal and State arbitration systems and it should be possible for federal and State authorities to examine the question whether organisations and trade unions can be provided with such a system.’

2. A preliminary question raised was whether an organisation under the Act may participate in State systems and allied to this the question whether a branch of such an organisation may be registered under a State Act. If neither of these is possible, it may well be difficult to resolve the problems which have arisen and I proceed next to a consideration of these questions of validity.

9

Questions of constitutional validity

1. Questions were raised before the Committee by the New South Wales Government as to (a) the constitutional power of the Australian Government to legislate to permit registration of branches of a federal organisation under State Acts, (b) the validity of registration of such branches under the State Acts in their

present form and (c) the validity of Section 132 of the Act. Mr J. F. Dey, Q.C. appearing with Mr G. Maidment for that Government addressed the Committee on these and other matters.

2. The submissions were not supported by the Governments of Western Australia or South Australia. The Government of Queensland after being invited to comment on them merely stated:

‘It is not considered that the New South Wales submission referred to by His Honour will have any impact on the policy of this State. The conclusion stated is one of law and emphasises the limited jurisdiction which the federal parliament has in relation to industrial matters.

This State is concerned with the union which is registered under its laws. Such a union is given corporate status for convenience in management, ownership, etc. Where the body seeking registration under our laws is allied to an organisation

registered in the Commonwealth jurisdiction no doubt problems may arise in respect to there being two separate corporations. However in registering a group of persons under the Queensland laws the State has a right to give that group when registered a corporate status and it is immaterial that the applicants in other spheres may be

or be part of another organisation which is registered federally. In registering any body for the purposes of a State law it is submitted that there is no diminution of any of the powers or status of an organisation registered under federal law for different purposes.’

3. The New South Wales Department of Labour in its submissions to the Working Party sought:

(a) Amendment of the Industrial Arbitration Act to specifically enable the New South Wales branch of an organisation registered under the Australian Con­ ciliation and Arbitration Act to obtain registration as an industrial union under the Industrial Arbitration Act.

(b) Amendment of the Australian Conciliation and Arbitration Act to ensure that registration of the New South Wales branch of a federal organisation as an industrial union under the Industrial Arbitration Act will not be invalid (i.e. that proposal (a) above will not be held invalid on constitutional or other grounds).

4. The New South Wales Government in its submissions to this Committee has taken a different view as to power. Its submission is:

10 Questions of constitutional validity

‘It is therefore submitted that while it is competent for the Australian Parliament to provide for the incorporation of organisations and their involvement in the processes of conciliation and arbitration for the prevention and settlement of indus­ trial disputes extending beyond the limits of any one State, it cannot create or confer authority upon such organisations or any branch thereof to be involved in intrastate disputes and the authorising of some tribunal not the creature of the Australian Parliament to supervise or control the operations of such an organisation in connec­ tion with its participation in intrastate disputes and a system for dealing with such disputes cannot be regarded as incidental to the constitutional power of the Australian Parliament.’

5. The importance of the questions raised is obvious. The Statutes of the other States all allow for the registration and participation in State industrial arbi­ tration of branches of a federal organisation. In New South Wales there are many instances of the registration of such branches (see Benson v E.T.U. 1962 N.S.W.A.R. 516 at 528). If the submission is correct then all these registrations are invalid. The submission was not made by or supported by any other Government or organisation.

6. The scheme adopted in the Act is described in Williams v Hursey 103 C.L.R. 30 at pp. 67-8:

‘What the Commonwealth Act does, then, is to give legal personality to every organisation registered under it, and to the personality so given are attached certain powers. In other words, the capacity of the new “person” is defined indirectly by the Commonwealth Act. It is defined directly by the rules of the organisation, which are registered when the organisation itself is registered, and which then derive their authority from the Act. If the registered rules, on their true construction, empower the organisation, as I think they do in the present case, to make a levy for the assistance of a political party, then that power must be regarded as derived from the Act. The Act and the Regulations expressly permit the rules of the organisation

to provide for “any other matter not contrary to law”. Whatever may be the scope of the words “not contrary to law”, it is clear that it is not and never was contrary to law or forbidden by law that any person should engage in political activities. It would be absurd to suggest that such activities were illegal in themselves. There is,

of course, one other limitation on the powers which a registered organisation may take to itself by its rules, and that is that nothing is permissible which would tend to frustrate the policy and main purpose of the Act: cf. Australian Workers’ Union v

Coles (1917 V.L.R. 332 at pp. 336, 337) (per a’Beckett I.). But again that limitation is not transgressed by a rule which gives a power to use funds for political purposes. The application of funds for the support of a political party is, as has been seen, a traditionally accepted means of “furthering or protecting the interests” of members

of an association of workers or employees.

The passages in the judgment of a’Beckett J. which I have cited above, are too long to set out in full, but they express strongly and clearly the whole substance and reality of the position. There is nothing unconstitutional in the position as a’Beckett

J. saw it. It would be different, of course, if the lumbunna Case (1908(6) C.L.R. 309) had been decided the other way. But it has been accepted ever since 1908 that the Commonwealth may create these corporations, and, if it can create them, it must be able to define their powers. They must be associations of employees or of employers formed for the purpose of protecting and advancing the interests of their members, and no reason exists for saying that they cannot be empowered to do anything “not contrary to law” which is calculated to protect or advance those interests — to engage in propaganda by means of a newspaper or to contribute to the funds of a political party favourable to those interests.’

The organisation is one whose dominant purpose is the protection and 7.

Questions of constitutional validity li

advancement of the interests of its members and the representation of groups of employers or employees and which may have other purposes not contrary to law. It has in addition the incidental powers flowing from its creation as a corporation. So in Hursey’s Case the raising and expenditure of funds for political purposes was held to

be within power.

8. ‘Involvement in intrastate disputes’ seems to me to be clearly incidental to and necessary and properly required for carrying into effect the purposes of its incorporation and in itself is not contrary to law.

9. The Act deals with the settlement of interstate industrial disputes but even in respect of these the Act contemplates that a dispute in respect of which the Commission has jurisdiction may be also before a State industrial authority (cf. Section 66) and that disputes or parts of disputes which are within its jurisdiction may be proper to be dealt with by a State industrial authority and that in some circumstances the Commission should refrain from exercising its jurisdiction on that ground (cf. Section 41(1) (d)).

Like provisions have been present in the Act from its inception. The position is then that an organisation whether of employers or employees may be involved in a dispute part of which goes to a State industrial authority for determination. It is not the position that all interstate industrial disputes and all parts of them are necessarily

to be dealt with under the Act. Section 66 of the Act is in the same terms as the previous Section 20 and of it Beeby J. said ‘The purpose is to prevent two tribunals operating in the same area over the same people at the same time’ (40 C.A.R. 69).

10. Moreover, an organisation either of employers or employees may be or its members may be involved in industrial disputes as to which the Australian Com­ mission will have no jurisdiction because they lack an interstate character.

There are many examples of these but they are sufficiently illustrated by reference to two High Court decisions. The first of these is R. v Gough; ex parte Cairns Export Meat Co. Pty. Ltd. 108.C.L.R. 343. This was a case where both the union and its members and an employer’s organisation and its members were bound by a federal

award. A dispute arose concerning the dismissal of certain employees and an order was made for reinstatement. It was held that this particular dispute was not one extending beyond any one State and did not partake of that character and that the order was not incidental to the settlement of a two-State industrial dispute.

A similar case arose in R. v Gough; ex parte B.P. Refinery 114 C.L.R. 384. In that case there were a number of disputes between employers and a union and its members but it was ultimately held that there was in reality no dispute of an inter­ state character. The disputes went to questions of wages and conditions but not

having the character of an interstate dispute could not be dealt with in the Com­ monwealth jurisdiction.

11. There are many such cases which arise and indeed such a case arises whenever the Australian Commission exercises its discretion under Section 41(1) (d). The moving party, be it employer’s organisation or employee’s organisa­ tion is then faced with the position that the dispute can only be dealt with by a

State industrial authority.

12. Moreover, the fact is that there exists and have long existed various awards in State jurisdictions which may supplement federal awards. One example of

12 Questions of constitutional validity

these is what is known as counterpart awards. In a large number of industries where federal awards operate, some employers are not parties to the dispute either in their own right or as members of employers’ organisations. Some may have com­ menced business subsequent to the making of the award and it is a common practice for an award of the State tribunal in the same terms as the federal award to be obtained to cover these employers.

In addition, there are in many cases certain areas of industry as to which it is not desired by either the union or the employer or the employer’s body to have a federal award operate and in such circumstances although the employees and the employer may both be members of their respective organisations, the State awards are obtained and will operate.

13. In order to represent their membership and protect the industrial inter­ ests of members it is necessary for the Commonwealth corporations to take part in the workings of State industrial authorities. Seeking awards, enforcing awards and entering into industrial agreements under State machinery are incidental to and consequential upon the representation of the same class of employers and employees under the Commonwealth legislation.

14. The position may be illustrated by taking some well-known cases. In all four States with which I am concerned, there are certain meat works which operate under State awards and some which operate under federal awards. There is a considerable movement of employees between these works. Similarly in the metal trades in the tradesman area there are certain employers operating under State awards and certain under federal awards. In some cases those operating under State awards are very big employers such as the steel companies in New South Wales. Again, in the building trades in each State there are some employers operating under

State awards, some under Federal and again there is necessarily a movement of employees from one type of employer to the other. It is necessary for the industrial interests of employees to be protected in both fields and it seems clearly incidental to the purposes which the legislature has expressly authorised for these industrial interests before the State industrial authorities to be protected. It may also I think fairly be said that the powers of the Commonwealth corporation to take part in pro­ ceedings affecting their members before State industrial authorities are necessarily and properly required for carrying into effect the purposes of its incorporation. If the industrial interests be they of employers or employees can only be protected by a separate and distinct union and one to which they would have to transfer their membership on moving from one field of employment to another, all the difficulties of inter-union rivalry would arise.

15. The question is whether the Act validly allows the registration in one form or another of the Commonwealth organisation or part of it to enable it to participate in the workings of State industrial authorities for the protection of the industrial interests of its members.

For the reasons outlined earlier, I am of the view that such a power can validly be given under the Act in pursuance of the power to legislate under placitum xxxv which authorises Parliament to make laws with respect to conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond

the limits of any one State and placitum xxxix which authorises Parliament to make laws with respect to matters incidental to the execution of any power vested

Questions of constitutional validity 13

by the Constitution in the Parliament. In the Jumbunna Case the view seems to have been adopted that it would have been within power to give to trade unions and other associations constituted under the State laws a locus standi before the federal tribunal (cf. O’Connor J. at page 359).

It seems then to me that the conferring of a power on an organisation constituted by virtue of the placita of a locus standi before State industrial authorities is clearly within power.

This is consistent with the view expressed by Menzies J. in Williams v Hursev 103 C.L.R. 30 at 114. '

16. It is necessary however to consider the other branch of the argument expressed as a proposition—that ‘nothing is permissible which would tend to frus­ trate the policy and the main purpose of the Act’. Various provisions of State Acts are said to be such that registration under them, necessary for participation, have

that tendency.

17. The difficulties arising may be indicated by a reference to the decision of the High Court in Williams v Hursey 103 C.L.R. 30. In the judgment of Fuilagar I. in which Dixon C. J. and Kitto J. concurred, His Honour at pp. 54-55. consider­ ing the statutory rather than the constitutional position, said in discussing the

Hobart Branch of the Waterside Workers’ Federation :

‘It has no separate identity — no existence apart from the registered organisation, of which it is an integral and inseverable part. Its members are merely a section of the total .membership of the federation — locally organised for the sake of convenience, but in no respect independent of the federation, and in all respects subject to the

control of the federation. The branches are permitted within limits to make rules of their own but the rules which they make derive authority from the rules of the federation. It is contemplated that a branch may have “property and moneys", but. if R.15 of the Hobart branch rules means that the beneficial ownership thereof is

in the members of the branch, it is inconsistent with R.10(A) of the rules of the federation which makes the “fund and property” of the organisation and its branches subject to the “care, superintendence, management and administration of the govern­ ing body of the Organisation for the carrying out of the objects of the Organisation".

The position is precisely analogous to that which was held by this Court to subsist in Hall v lob (1952 (86) C.L.R. 639) and there is a passage in the judgment in that case which, if we read “Federation” or “Organisation” for “Institution" and “Branch” for “Lodge”, is exactly applicable to the present case. The passage is as

follows: “ ........an individual cannot be a member of the Lodge except as a member of the Institution. The mutual rights and obligations of the members of the Lodge spring from the rules of the Institution, and cannot be altered except as those rules provide. The purposes which the members of the Lodge have in common arc none

other than the purposes for which they are members of the Institution. The Lodge does not exist as a society of persons who desire to associate exclusively with one another for agreed purposes; it exists as an integral part of a larger organisation, of which all the members are associated for the pursuit of purposes common to them all

in accordance with a constitution which governs them all. A subordinate Lodge is therefore not to be considered as if it were an association by itself; it is in truth a branch of the Institution, a section of its membership, which provides, for those who belong to it or may be admitted to its meetings, machinery for the enjoyment

of the rights and benefits, and for the performance of the obligations and functions, which are the incidents of their membership of the Institution”.’

His Honour again in discussing the same position said at page 60: ‘The position now reached may be summed up thus. The federation is a body whose

14 Questions of constitutional validity

constitution authorises it (inter alia) to raise and expend moneys for political purposes. It is registered, and by virtue of its registration incorporated, under a Commonwealth Statute, which has nothing to say against the raising and expending of moneys for such purposes. In my opinion this is decisive of the question in the first action. But it is necessary to consider now what was perhaps the main argument presented by counsel for the respondents. This argument rests fundamentally not on

Commonwealth law but on State laws. I think that the short and conclusive answer to it is provided by saying that it is constitutionally impossible for a State statute to prescribe what shall or shall not be the powers of a corporation which is created and empowered by a law of the Commonwealth.’

and at page 65 said :

‘........the powers of an organisation registered under the Commonwealth Act depend wholly on that Act and cannot be restricted or affected by any State legislation.’

and again at page 68 said:

‘This being the position under the Commonwealth Act, and these being the powers which the incorporated organisation has by virtue of its own registration and the registration of its rules under that Act, it must be beyond the power of any State to alter that position or to qualify those powers. No State could a priori forbid or

ex post facto annul a power which is derived in this way from a law of the Common­ wealth. Any attempt to do any such thing would involve a plain inconsistency within the meaning of S.109 of the Constitution. No State Act could restrict the powers of the Commonwealth Bank or the Australian Broadcasting Commission. It is not merely that the State would be forbidding something which the Commonwealth permitted, as in Colvin v Bradley Bros. Pty. Ltd. (1943 (68) C.L.R. 151) and O’Sullivan v

Noarlunga Meat Ltd. (1954 (92) C.L.R. 565; 1956 (95) C.L.R. 177). The State would be invading a territory which the Commonwealth has marked out as its own and for which it has made exhaustive and exclusive provision. It has laid down what is to be the law relating to the powers and functions of its own specially created corporations.

Organisations registered under the Commonwealth Act are simply no concern of the States. Any other view would involve absurdity. The Commonwealth corporation could be put in the position of having mutually inconsistent objects and powers in each of the six States. I have thought further (apart from any decision on any Trade Unions Act) that, if a corporate body is created and empowered by or under Commonwealth law for Commonwealth purposes, its capacity cannot be cribbed or confined or in any way affected by any State law. Part VIII of the Act occupies the whole of the relevant field.’

18. While it is clearly within power for an organisation to participate in State industrial arbitration, the requirements of particular State Statutes may prevent a particular exercise of the power.

19. In considering the submission of the New South Wales Government it is necessary to look at the State Statutes and their present requirements.

The Act provides for incorporation on registration (Sections 132, 136, 146). It then provides for various controls. These relate to the administration of the organ­ isation; Sections 132, 133 and 137 specifying requirements as to the content of rules, Section 139 as to the manner of altering rules, Section 140 as to disallowance of

rules, Section 141 as to ordering the performance of rules, Part IX dealing with disputed elections.

There are in addition requirements as to filing various returns as in Sections 152, 153A and 154.

Questions of constitutional validity 15

20. Registration under the State Acts as at present involves in each case the incorporation of the body registered.

Each State Act also provides some or all of the controls referred to in the pre­ ceding paragraph.

The effect of registration under State Acts is that firstly the branch becomes a legal entity contrary to the position under the Act where it is merely a part of a legal entity. Secondly, various provisions of State Acts do purport to qualify the powers of the branch of the corporation. Examples are the penal provisions of the

State Statutes such as Section 100 of the New South Wales Act which has long been held to apply in respect of actions by members of State registered unions employed under federal awards {Browns Wharf v Scott 1915 A.R. (N.S.W.) 285; Lysaghts v A.E.U. 1950 A.R. (N.S.W.) 753 at 580; McNally v Australian Coal and Shale

Employees’ Federation 1951 A.R. (N.S.W.) 294).

Registration then would make a federal corporation (or part thereof) liable for penalties if its members working under federal awards were on strike in circum­ stances where no such liability arose under the Act. Like provisions exist in other State Statutes.

In Western Australia, for example, the Statute requires that a registered union should have in its rules an express provision that all industrial disputes in which it or any of its members may be concerned shall unless settled by mutual consent, be referred for settlement pursuant to that Act—S.9(B) (2) (c).

It is inconceivable that a branch of a federal organisation could have in its rules a provision such as this requiring that all industrial disputes be referred for settle­ ment under the Western Australian Act and consequently no use made of the machinery under the Act.

21. Moreover, each of the State Statutes provides some powers of control similar to those contained in Sections 140, 141 and 144 of the Act.

These aspects which raise difficulty are the powers given to the State tribunals to disallow rules of its registered bodies, to make orders in respect of elections in its registered bodies and to make orders for the performance and observance of rules of its registered bodies. These differ somewhat in the Statutes but if the correct view

is that the Act seeks to cover the field in respect of its registered organisations in these matters a further doubt as to the validity of the registration of a branch of the federal body under the State law I think arises.

Alternatively perhaps doubts will arise as to the validity of the State laws so far as they purport to apply to branches of federal organisations. Indeed the Queens­ land Act appears designed to ensure that the provisions of that Act relating to disputed elections are to have no application to unions registered under that Act

which are also branches of federal organisations (Section 75). (cf. Allingham v A.W.TJ. supra as to Section 144).

22. While therefore I reject the submission that there is no constitutional power to create organisations which in addition to their dominant purpose have the purpose of participating in State systems, I agree that there may be no power to register under a particular system. In particular the Acts of Queensland, South

Australia, Western Australia and New South Wales are such that a purported

registration of a federal branch under them would be inconsistent with provisions of the Act and would tend to frustrate the policy and main purpose of the Act.

23. A related question raised by the New South Wales Government was the validity of Section 132 of the Act as it now stands. The importance of this is two­ fold, having effects on both employer and employee organisations.

The first importance is that many State registered unions have as members persons who are neither employers nor employees but follow an occupation closely associated with the callings within the conditions of eligibility of the organisation. There are many examples but those best known are lorry owner drivers, in many cases carrying out work under contract in association with employees of the con­ tractor who are also drivers. Many cases also exist in the building industry where men over a period may sometimes be employee bricklayers etc. and at other times sub-contract bricklayers.

24. A further special problem affecting both the valid functioning and the registration of organisations at the present time under the Act was raised by em­ ployer bodies. Section 132 limits membership of an organisation to employers. An employer is defined as meaning any employer in any industry and includes a person who is usually an employer in an industry. In industries, generally there are a con­ siderable number of businesses conducted on a small scale without employees. This occurs in areas where there are employers both of large numbers of employees and of small numbers. The persons to whom I have referred are not employers but may be conducting small businesses such as a small retail shop. There is an urgent need for them to have representation and the benefit of representation in matters such as prices, tariffs, customs duties and various trade matters.

In addition, many of them are directly affected by terms of awards in such matters as trading hours. In New South Wales, for example, the Factories, Shops and Industries Act fixes trading hours for many businesses by reference to the ordinary hours of work during which employees may be employed under respective awards.

See for example Factories, Shops and Industries Act, 1962-66 Section 80 and Section 86. A similar position exists in Queensland.

Apart from the question of hours, such persons may also be interested in provi­ sions such as wages, penalty rates etc. since they are in competition with employers directly affected by provisions such as these.

Many of these persons will eventually by reason of the expansion of their business become employers. Others may be employers from time to time. Examples have been placed before me dealing not only with retail stores but with manufacturing industries and graziers and rural producers. It is frequently the position, for example, that wool producers may sometimes employ shearers, other times have

shearing done by contract, may for particular tasks employ persons or have work done by contract.

In all these instances it appears that the persons concerned are in a relatively small way of business. It is highly desirable that they should be able to draw on the knowledge and experience of employer organisations which all appeared to function in a manner which allows representation of these persons in matters other than employer/employee relationships but which may be of vital importance to the persons involved.

16 Questions of constitutional validity

Questions of constitutional validity 17

25. It was further pointed out that in the 1973 amendment to the Act. pro­ vision was made which enabled persons engaged in industrial pursuits but not as employees to be enrolled providing the association or organisation enrolling them was effectively representative of the members who were employees. This it was agreed was a valuable and desirable provision. It enabled persons such as lorry

owner drivers and taxi drivers who by the nature of their occupation were closely akin to employees to be enrolled.

This scheme was consistent with the findings of the New South Wales Industrial Commission in a report issued after that Commission had conducted an exhaustive inquiry into the circumstances of lorry owner drivers, taxi drivers and the like. It had further application in a number of cases in the building industry.

It seems to afford the only real basis on which a settlement might be reached between the Transport Workers’ Unions with the consequential elimination of the damaging effects upon the public. This is discussed further later in this report.

26. The submission was made for the New South Wales Government that the provisions in Section 132 which allow persons who may not be employees in an industry to be enrolled as members of an organisation of employees are invalid as would be a similar provision for employer organisations. The argument is that the

constitutional power under placitum xxxv and placitum xxxix of Section 51 do not enable the creation of an organisation except one consisting solely of employers or solely of employees.

To consider this, it is necessary to examine the history of this Section. In the original Act provision was made for the registration of certain associations. Pro­ vision was also made for the proclamation of associations which on proclamation would become organisations. An association was then defined as:

‘ “Association” means any trade or other union, or branch of any union, or any association or body composed of or representative of employers or employees, or for furthering or protecting the interests of employers or employees.’

At that time under the Trade Union Acts of the various States, a trade union was usually a body of either employers or of employees but this was not necessarily the case. The definition of trade union was substantially uniform in the various Trade Union Acts and Section 31 of the New South Wales Trade Union Act is typical of the statutory definitions:

‘The term “Trade Union” means any combination whether temporary or permanent for regulating the relations between workmen and employers or between workmen and workmen or between employers and employers or for imposing restrictive conditions on the conduct of any trade or business whether such combination would

or would not if this Act had not been passed have been deemed to have been an unlawful combination by reason of some one or more of its purposes being in restraint of trade.’

It is clear that a trade union could be one composed solely of employers, one solely of employees or one which was mixed (cf. Green Cabs v Whitfield 1965 N.S.W.R. 1325).

The definition of association then as meaning a trade union could have included a mixed body of employers and employees. In the second part of the definition, reference is made to any association or body composed of or representative of employers or employees and it is clear that a body not composed solely of em­

18 Questions of constitutional validity

ployers or employees but still representative of one or the other fell within the definition. The then counterpart of Section 132 was Section 55 which provided for the registration of an association of employers or an association of employees, in each case in or in connection with any industry. It narrowed the associations which could apply for registration to those of employees or employers.

However the proclamation provisions meant that an association representative but not necessarily composed of employees in the one case or employers in the other could become an organisation. There were such bodies (cf. Killen v A.W.U. 9C.A.R. 33).

27. It was this section which was considered in the Jumbunna Case. Regard was had to the definition section and to Section 55 and the provision was held to be a valid exercise of the constitutional power. Reference was made in that case to the argument that it would have been sufficient for the legislature to ‘take the State trade union or association as the unit of combination’ (per O’Connor J. at 353). At the same page His Honour said after discussing the nature of industrial disputes ‘such being the nature of the disputes covered by the constitution, it is open to the legislature to adopt any method which they deemed effective for prevention and settlement by conciliation and arbitration’. ,

28. The subsequent history of Section 55 was that in 1914 there was added a proviso allowing an association of employers to be registered notwithstanding that it contains persons whether employers in the industry or not as have been appointed officers and admitted as members and a similar provision made in

respect of associations of employees. This was substantially repeated in 1956 and remained in that form until 1973 when it was amended to take its present form.

29. It will be noted that it is a provision of the Section that the association seeking registration may contain the following classes of persons who are not employees in an industry:

1. Officers

2. Persons who follow an occupation in or in connection with the industry 3. Persons who are employees qualified to be employed in or in connection with the industry

and thereafter like provisions under paragraph (c) of ss. (1) in respect of associa­ tions primarily of employees engaged in an industrial dispute. In each case the test is whether the association is effectively representative of the members who are employees engaged either in connection with the industry or in an industrial pursuit or pursuits.

30. I see nothing to support any view that an association may not be

effectively representative of the members who are employees referred to because it may also contain some persons in respect of whom an award could not be obtained.

It is quite clear that nothing in the provision suggests in any way that the award making powers of the Commission would extend to the non employees.

There appears to be no precise decision on the matter but the view has been taken that an alteration to rules was not invalid because it allowed persons who were not employees in an area where an industrial dispute within the constitutional meaning could arise to become members of an organisation.

Questions of constitutional validity 19

In Melbourne & Metropolitan Tramways Board v Municipal Officers’ Association 68 C.L.R. 628 Starke J. said ‘The suggestion that the changes in the conditions of eligibility for membership of the organisation will allow persons who are not engaged in any industrial dispute as the staff of a university access to the arbitration court is ill-founded. That court has only authority to deal with industrial disputes and matters under the Commonwealth Conciliation and Arbitration Act'.

31. In a later series of cases concerning the Association of Professional Engineers, a question was raised on the original registration whether an organisation could be registered to embrace both Public Servants and employees not in the Public Service (73 C.A.R. 134).

In later proceedings for an award the dispute was found to involve certain member employees engaged in industry and other members not so engaged. The classes of members not so engaged were employees of States and State Departments and so not caught up by the Public Service Arbitration Act or any power to legis­

late in respect of employees of the Commonwealth. The log served by the organ­ isation was held to create an industrial dispute. Although almost every possible issue appears to have been raised it was not suggested that the organisation was invalidly registered because it comprised both members who could be involved in an interstate dispute and those who because of the nature of their employment could never be so involved (Ex parte Association of Professional Engineers Australia

107 C.L.R. 208 at 245, 252, 265, 269 and 270).

The question was discussed by Walsh J. in Pitfteld v Franki 123 C.L.R. 448 at 474/5 but he did not find it necessary to reach an opinion on the point.

32. The Legislature in my view is entitled to select bodies which could effectively represent employee members for the purpose of conciliation and arbitra­ tion and to incorporate them.

Moreover, Section 144 of the Act gives a right to a person whose usual occupation is that of employee or who is qualified to be an employee and desires to apply for membership to seek an order from the court that he be admitted.

A like provision has been in the Act since 1952 and has been acted on frequently without challenge.

The provision as to officers has been in the Act since 1914 without challenge. In these circumstances there seems to me no reason to doubt the validity of the present Section or the power of the Legislature to make a corresponding provision in the case of employer organisations.

20

The desirability of continuing the present system of dual incorporation

1. The Committee being of the view that (a) an organisation registered under the Act may have as a purpose participation in State industrial arbitration systems, (b) the present State Acts are such that organisations and their branches cannot be registered under them and (c) Section 132 is valid, the question then is whether the system of dual registration and incorporation is necessary or desirable.

2. After the decision in Moore v Doyle, a Working Party was set up by

the various Departments of Labour. No one then suggested the system was desirable

New South Wales now claims it is undesirable but necessary because of the con­ stitutional problems to which I have referred.

Queensland has submitted that the problems are more theoretical than real.

On the other hand, the Committee had submissions, written and oral, from bodies and organisations representative of the majority of both employee and employer organisations. They were unanimous that a change in the present system was desirable.

3. During the proceedings submissions were invited in a document very widely distributed to organisations concerned. On the following background matters:

1. A system of registered organisations representing on the one hand employees and on the other employers is essential for the proper functioning of any system of conciliation and/or arbitration.

2. Federal organisations of employees and employers must in order properly to protect the industrial interests of the groups they represent take part in State systems of conciliation and arbitration.

3. Problems arise due to the fact that while the organisation itself is incorporated under the Commonwealth Act, registration under the various State Acts involves incorporation of the registered body either in terms or by implication.

4. There are in each State many unions of employers and employees who do not seek federal registration and for these the present system of State registration and incorporation should be maintained.

5. Incorporation is necessary to enable a body to function satisfactorily but dual incorporation has led in all States to a position where the valid functioning of the respective bodies presents overwhelming problems.

6. Where a federal organisation exists, the need to take part in State industrial machinery has led to the formation of what may be called associated State bodies. In most cases these, which by reason of their registration under State Acts become separate legal entities, function as if they were also the State branch of a

21

federally registered body. In a few cases endeavours have been made to establish an associated body which may function as an independent legal entity.

7. This has led to:

(a) considerable extra expenditure and administrative difficulties;

(b) the present position where irregularities and invalidities abound and few. if any, of the federal organisations and their associated State bodies function validly.

8. In the case of all organisations whether employer or employee and whether con­ fined to State or not and apart from problems arising from dual incorporation, there may from time to time have been departures from and failures strictly to comply with mandatory rules or failures substantially to comply with directory

rules. In other cases where an internal dispute or other reason arises, this may lead to a position where a body has so failed to comply with its rules that many of its actions have been nullities. It may be unable to cure the invalidities and unable to function validly.

the only disagreement came from the State of Queensland which did however say of these background matters:

1. It is accepted that registered organisations are essential for the system to operate.

2. It is considered desirable that many federal organisations have access to both federal and State systems.

3. Legal problems do exist but to date have been more hypothetical than real in Queensland.

4. These unions appear outside the scope of the problems being considered by the Committee.

5. It is considered that dual incorporation does present legal complexities but these may be reduced by unions themselves.

6. & 7. Generally this is so but again the practical probabilities of challenge is not grave.

8. In theory this is possible but unlikely.

Perhaps this does little more than illustrate the old adage that the best player on the ground is always a spectator.

Those concerned with operating a system of dual registration and incorporation clamoured for a change.

4. I have discussed elsewhere in the report submissions made by the

Queensland and New South Wales Governments. A written submission was made by the Western Australian Government which is summarised below.

Western Australian Government In the Working Committee, the Western Australian Department of Labour proposed steps to enable a State branch of a federal union to be registered under the State Act. It was sought to accomplish the transfer of corporate entity from the State union to

the State branch of the federal union and to retain that corporate entity as a creature of the State Act.

The object was ‘to arrive at a situation where, upon registration of the State branch of the federal organisation pursuant to the Western Australian Act, the existing State

The desirability of continuing the present system of dual incorporation

22 The desirability of continuing the present system of dual incorporation

union which is the counterpart of the federal branch should be deregistered. The idea is that from that point on, the State union merges with and becomes the State branch of the federal union in law and in fact. If that can be achieved the Western Australian departmental representatives believe it will result in a better solution to the Moore v

Doyle problems than recognition as conceived in South Australia. If it is impossible to achieve, then the recognition concept does provide a better system than that which currently exists.’ In submissions to the Committee, objection was expressed to the scheme outlined by the Committee in paragraphs 9 onward. The background stated in paragraphs 1-8 was accepted.

An additional proposal was made in oral submissions to the Committee. This was that the Commonwealth system should be changed to one of creation of corporations, each member of which would be the corporation registered State union. In effect this would mean adopting a system which was proposed in the Jumbunna Case as the proper course but not then adopted or since advocated.

This was said to be based on a view that the State system of organisation was more effective than the federal, a view which was not developed despite an invitation to do so. It is moreover a view which does not seem supported. An estimate was given that some 50% of workers in the State were employed under State awards and that about half of that number were employees who could not be covered by federal awards because their employment was not industrial in the constitutional sense. That shows

a startling change since 1968, the year of publication of the last official figures on the incidence of State and federal awards. Then only 16.9% of workers in the State were covered by federal awards.

No other Government and no union or employers including those in Western Australia supported this approach.

Other Submissions Discussions were had with a large number of unions and employers and representa­ tive bodies of each.

In addition, a number have made written submissions after receiving and consider­ ing the statement issued by the Committee.

Two submissions made in discussions sought the abolition of State systems of arbitration and the vesting of all power in the Commonwealth, but that is something clearly outside the terms of reference.

All other submissions sought a system of registration or recognition of branches of a federal union under State systems and that this should not involve separate incorp­ oration under a State Act.

All had had experience either of a State branch seeking to function as a State registered union or of attempting to operate either as a shadow State union or as a shadow federal branch. All viewed a system which required either as a failure leading to administrative difficulties and expense and invalidities.

There were some differences as to terms, e.g. recognition or registration, but I find it significant that there was unanimous dissatisfaction with the present system.

5. Some examination of the problems which do arise is now necessary.

6. The Committee has had the benefit of discussions with a very wide range

of employee and employer organisations and it appears that attempts are made for the respective entities to function either as the same body or as separate bodies. In cases where an attempt is made for them to function as separate bodies, an intoler­ able burden of administrative cost and inconvenience arises. In cases where the

entities attempt to function as one body, extreme difficulties arise in practice. The usual method of so functioning has been well described by the Commonwealth Industrial Court in a number of cases. One such is Rounsevell v Mitchell 11 F.L.R. 414 at 418-420. A further example of such a method of conjoint operation is set out in the judgment of the Commonwealth Industrial Court in Moore v Doxle 15 F.L.R. 119-121. '

7. The immediate difficulties on registration are obvious but the position inevitably becomes further complicated as the years pass. The rule-making bodies in each case are different. In the case of branches of a federal organisation, the rule­ making body is, except for quite isolated and often accidental exceptions, a body entirely within the State, either a council or a meeting of members. Circumstances have arisen in many cases where different decisions have been made by on the one

hand the federal rule-making body and on the other hand the State rule-making body. In addition, in each case the validity of the change of rules depends on some form of registration and/or approval of the change and in some cases one Registrar has approved while another has rejected a proposed change. This has led to a

position where in very few, if any, cases are the registered rules of the two or three bodies identical in form. Taking one of the most important rules, that specifying the persons eligible for membership, an examination of the position of 24 major unions in New South Wales comparing rules of the State registered body with rules of the

federally registered body showed that in all the cases examined there were differ­ ences—some small but most great. Some had wider coverage in the State field, others the reverse. This leads to a position where different persons are eligible for member­ ship, different persons are entitled to attend meetings, different persons are entitled to

be elected to office and indeed the electorates are different. A graphic illustration of the position which thus arises is set out in the case of Steuart v Oliver 17 F.L.R. 99. It should be emphasised that the unions referred to in the cases to which reference has been made are by no means alone in this position, nor is the problem confined to employee organisations but it has been found to apply in quite a considerable num­ ber of employer organisations.

8. An examination of some reported cases illustrates the problems:

(a) In Brailey’s Case (supra) the New South Wales registered body had ceased to exist.

(b) In a case concerning the then Amalgamated Society of Carpenters and Joiners in 1955 (56 C.A.R. 368) a federal branch which was also functioning as a State registered union had in its latter role amalgamated with another State registered union covering different classes of workers. The federal organisation then sought to widen its conditions of eligibility to enable the second class to be enrolled. The hearing and determination of this application was delayed and in subsequent

proceedings the then Court held that the federal branch had become merged in the new amalgamated State union and had ceased to be a branch.

(c) In Sercombe v Hall 56 C.A.R. 368, a federal branch had sought to operate both as a federal branch and as the State registered union. The rules over the

The desirability of continuing the present system of dual incorporation 23

24 The desirability of continuing the present system of dual incorporation

years became different in the case of each and the federal branch was found to have become defunct.

(d) A similar position arose in Benson v Electrical Trades Union 1962 N.S.W.A.R. 516 except here the State registered union was found to have become defunct.

(e) In a case relating to an employer organisation, difficulties arising where an attempt was made to conduct the affairs of a federal branch and a State regis­ tered union are illustrated in Ingham v Walsh 1966 N.S.W.A.R. 66.

9. I attach considerable significance to the fact that in the many discussions had with organisations of employers and employees and representative bodies of such organisations there was general agreement that neither the system of co-existence nor conducting two separate and distinct bodies was satisfactory and further agreement

that a detailed investigation of the affairs and conduct of the bodies would almost invariably disclose invalidities.

10. In the case where two separate entities seek to operate separately there is a large area of duplication involved.

There must be separate applications to join, admission to each entity, separate meetings, elections, records, finances and funds, separate rule books and registers of members. If rules are not kept nearly identical there may be different officers, different committees of management. Rules will be required to be registered and in

some cases approved by different authorities who may and have in the past taken different views as to approval.

The rather grim history set out from reported cases in the preceding paragraphs illustrate the pitfalls in the other method of conjoint operation.

11. A further aspect of considerable importance is the problem which faces a member of a union in understanding the machinery of and participating in the affairs of a union.

Graphic illustrations have been given to the Committee of the problems involved in explaining to migrant workers the need to join two unions or why although he may be a member in terms of the State registered body, he is in an occupation outside the conditions of eligibility clause of the federal union and so not entitled to vote in a

federal union election even though the federal branch and the State registered union are conducted as if they were one body.

An express object of the Act is as set out in Section 2—

‘(f) to encourage the democratic control of organisations so registered and the full participation by members of such an organisation in the affairs of the organisa­ tion.’

The existing complexities, difficulties and uncertainties do not make for democratic control nor do they encourage the full participation by members in the affairs of the organisation.

I take the view that this object, though not expressly stated, is part of the philoso­ phy behind the State Acts and that a scheme which will aid rather than hinder it is desirable.

12. The effect of this position can be very great. In the federal system most awards are now made in the settlement of a dispute arising from the service of a log of claims by an organisation of employees on an organisation of employers and/or individual employers and the subsequent rejection of that log or vice versa.

The desirability of continuing the present system of dual incorporation 25

But the log must be validly adopted by the organisation concerned.

If there have been invalidities in elections such as a failure properly to elect a Returning Officer or in the conduct of an election such as the calling for nominations at the wrong time or the closing of the election at the wrong time or if persons not entitled to be admitted to membership or if entitled not properly admitted to mem­

bership, vote or are elected to office, there may be no validly constituted committee of management or officers.

No log of claims will have been validly adopted, no industrial dispute will have arisen, any award made will have been made without jurisdiction.

Similar considerations arise in State jurisdictions.

13. In organisations both of employers and employees, the validity of an act done and the validity of the holding of an office depend on the validity of all that has gone before. There are no statutory provisions to allow the curing of the invalidity

and it may well be incurable, cf. Federated Ironworkers’ Association v Munition Workers’ Union 56 C.A.R. 699.

14. The challenge to the validity of any act of an organisation may come in many ways: from a dissident member, another organisation or as in the case of a prosecution for a breach of an award, from an employer or employee prosecuted.

15. Since the valid functioning of organisations is essential to any concilia­ tion and arbitration system and since such systems play a vital role in our society it is clearly in the public interest that there be a system of registration which will facilitate that.

‘In the field of industrial relations every consideration is in favour of simplicity as opposed to complexity’ per Menzies J. (re Clarkson; ex parte The Victorian Em­ ployers' Federation 44 A.L.J.R. 772 at 776).

16. Public interest may well be affected in other ways, as is illustrated in the events happening subsequent to the decision in Moore v Doyle.

Subsequent to the decision of the Court a gap arose in the industrial coverage of transport workers in Australia. Several thousand employees working in industries in New South Wales were covered by federal awards. Twenty odd thousand in New South Wales were covered by New South Wales State awards. Although the Court

did not so rule, it was seen as inescapable from its judgment that the federal branch had ceased effectively to exist and eventually the federal council of the union closed its New South Wales branch. The position then was that the employees under federal awards in New South Wales had no union concerned with the making and enforce­

ment of those rules to protect their interests, while the employees under State awards lacked the advantages of association with a national organisation. At first a degree of co-operation continued between the unions but this increasingly proved unsatisfac­ tory. The New South Wales union made some contributions to federal funds and for

a time had some representation on bodies such as the A.C.T.U. Rivalries between the two unions however continued and appears to have been brought to a head by an application made by a newly established association set up by the New South Wales union. This was followed by a decision by the federal union to establish a new

branch in New South Wales. From that point on relations deteriorated rapidly. The federal body appears to have taken the view that since the New South Wales union had within its membership large numbers of lorry owner-drivers and the like who

26 The desirability of continuing the present system of dual incorporation

were not employees, that an amalgamation of the two bodies could not take place. The New South Wales union held the view that it was imperative in the interests of its employee members that lorry owner-drivers and the like should be organised. Its views in this regard seem completely supported by the report of an inquiry held by the New South Wales Industrial Commission and made on 23 February 1970. This position, it may be mentioned, seems now to have been cured by the recent amend­ ments to Section 132 of the Conciliation and Arbitration Act.

With the establishment of two rival bodies in New South Wales, relations deter­ iorated further and the effect on the public may be illustrated by a reference to three disputes which arose within the State. The first concerned the making of a new award by the Commonwealth Commission for transport drivers employed in the oil industry.

These employees in the State of New South Wales had long been covered by a federal award but were members in the New South Wales union only. They sought to be represented by officers of that union in conferences which led to the making of the award.

This was objected to by the federal union and the intervention was ultimately disallowed.

Thereafter strikes by drivers in the oil industry occurred and continued for some time. As a result, transport and industry in New South Wales were almost brought to a close.

A second like dispute in which the rivalry of the two unions played a consider­ able part occurred in February/March this year concerning a claim by transport workers employed by Shell Oil Company at one of its depots in New South Wales.

Again in the State of New South Wales there was a real danger of a closure of industry. A further series of disputes occurred in the aircraft industry and in the Department of Supply. I have had made available to me the files in the Australian Conciliation and Arbitration Commission relating to these matters and from a perusal of them I have no doubt that the inter-union rivalry was an important factor in each of the series of disputes. I record these facts not with a view to assigning blame to either union. They illustrate what has long been obvious, that an inter-union rivalry of this nature seems inevitably to lead to industrial disputes of considerable bitterness. A grave danger exists that if a similar position arises either in this or in other States and either the State registered body or the federal branch is found to be invalidly functioning and possibly defunct, similar rival

bodies will be set up with the gravest results to the public.

I should add that written submissions were made to the Committee by each union. These stated that if a system of non corporate registration, as discussed later, is adopted in New South Wales the two unions can settle their differences and amal­ gamate and these problems will not then recur.

Conclusion 17. The present registration under State Acts of branches of federal organ­ isations being invalid, a serious position arises.

Moreover, it is clear that the problems involved in conducting a shadow body or in trying to conduct the affairs of two corporations as if they were one have led to extreme difficulties.

The desirability of continuing the present system of dual incorporation 27

If there can be an effective scheme whereby one organisation can represent its relevant members in both State and federal jurisdictions so as to allow both systems properly to function, that is clearly preferable to the present uncertainties And doubts.

28

Solution proposed to the present problems

1. What is sought is a solution to the problems which will enable federal organisations both to operate as they do at present under the Act and which will also enable them to participate in State industrial arbitration systems. They must be able to operate without invalidities and their consequences occurring and it is preferable that they be able to do so without the expense and time consumed and difficulties involved in undue duplication. At the same time, the viability of the State systems of industrial arbitration must be preserved. This was emphasised in the terms of

reference of the Committee and for the reasons put earlier in the report, it is obviously necessary that these systems be able to operate fully and effectively.

A further factor is that any scheme adopted must be one which operates fairly with respect to all organisations involved, both those which function purely under a State system and those which will seek to function under both systems.

2. The real problems arise from the fact of dual incorporation, federal

organisations being firstly incorporated under the Act and then in one form or another there being a separate corporation and legal entity established under the State system. In my opinion this second incorporation is entirely unnecessary.

While incorporation is necessary for a union, be it of employers or employees, it is by no means the position that the greater the number of incorporations the better. Rather is the fact the contrary. Nothing is gained by dual incorporation—no additional powers, no greater ability to function under the system. But it does lead

to the type of problems which have been discussed earlier.

3. The first requirement then is to allow a system of registration to be

adopted for federal organisations within the States which does not involve them being incorporated under the State Act.

The incorporation provisions of the State Acts must remain for the bodies which are not otherwise incorporated.

In my view a system of registration whereby the registered body under the State Act does not by virtue of that Act become a corporation should be adopted.

To distinguish the situation from that of bodies functioning solely under a State Act, a different term should be adopted and I think an appropriate one is ‘a form of non corporate registration’.

4. It is clear that any system of industrial arbitration requires that there be a sufficient degree of control of the bodies operating within the system. An examina­ tion of the State Acts shows that there are differing degrees of control but that those operating at the present time may be considered under three headings:

(a) Controls as to registration, deregistration and imposition of penalties.

Solution proposed to the present problems 29

(b) Controls as to rules including a power to require the performance and observ­ ance of rules. Control as to elections to ensure that members of a body arc represented by properly chosen officials and the provision as to returns giving information on various aspects of the bodies to the State system concerned.

(c) Power to require attendance at conferences and the like and to ensure the participation of the registered bodies in various proceedings.

Registration, deregistration and penalties

5. In my view the State system should in each case retain a power to register the bodies which are to participate in its system. The State system should retain the power to determine both the suitability of an applicant seeking registration and the area within which it should operate. These would be matters within the discretion

of the State concerned but I contemplate that at least the discretion of the State tribunal in determining whether to register or not would be exercised having regard to the degree of autonomy of a federal branch for which registration was sought, the branch’s power to control activities within the State system, the presence of officers

and like matters.

6. The State system should also retain the ultimate sanction of deregistration of a federal branch. This is a sanction rarely used but one which the State system has in each case in respect of registered bodies functioning solely within that system. In the scheme which is proposed, the same ultimate sanction would remain to be

exercised in the discretion of the State system.

7. Each State system at present provides for imposition of penalties in

cases of illegal strikes or lockouts. In New South Wales this has been held to extend to strikes by members of registered unions even though they are employed under federal awards. If this were removed and the power limited to cases concerning the working under State awards there would in my view be no possible conflict with the

federal Act and the powers could be as effective in dealing with a federal branch as in dealing with another body registered under the State Act.

8. An issue which has been raised is the need to provide a method whereby the federal branch when registered under a system of non corporate registration may sue and be sued.

Since the branch will not be a legal entity, it could not be sued in its own name. The remedy is to provide that the rules of an organisation shall contain a provision that if a branch is to obtain registration to enable the organisation to participate in State industrial systems then the Secretary of the branch shall be the person to sue or be sued in any matters arising under the State Act.

9. Allied with this is the concern, expressed in the main by the State

Governments, about methods of enforcement of any penalties imposed.

This position can be met by the State machinery requiring, as a condition of registration of a federal branch that the organisation enter into a deed undertaking to pay to the Industrial Registrar any penalty imposed in respect of a strike or lockout under the State Act and remaining unpaid for a period of fourteen days

after the last day fixed for payment.

There seems no doubt as to the validity of such a deed ( Waterside Workers Federation of Australia v Stewart 27 C.L.R. 120).

30 Solution proposed to the present problems

Contents of Rules

10. Directions for performance of rules and disputed election provisions.

The State Acts contain varying provisions on these matters. In general terms they provide a system whereby rule changes must be approved by a Registrar or the tribunal. The test applied in determining the appropriateness of the rules is generally to allow a wide discretion to the body concerned and for the State system to intervene only in a clear case of unreasonableness or where a rule is in conflict with a provision of the Statute. These are rare. The Act contains provisions as to requirements of rules and for the Registrar to certify an alteration to a rule where the alteration complies with and is not contrary to the provisions of the Act or the regulations or an award and is not contrary to law (Section 133, Section 133A and Section 139).

I think this power gives sufficient control over the rule-making powers of a branch. I think there should be added to it a provision that the Registrar is to give notice to and if required consult with Registrars of States before approving or certifying an alteration. If the rule as altered was still objectionable the State would of course retain the ultimate sanction of deregistration. This combination would be sufficient to ensure that a rule was not adopted which would embarrass or interfere with the working of the State system.

11. Some State Acts have provisions based on the Act for the disallowance of rules; others have more limited powers.

The provision in the Act is in Section 140. Again I think it preferable that one tribunal only should have this power in the case of federal branches.

There should be added to Section 140 a further ground for disallowance that the rules do not provide a sufficient degree of autonomy for a branch. This may well be covered already (cf. O’Mara J. 56 C.A.R. 592) but it is preferable to provide for it specifically.

12. Further provisions are contained in each State Act in one form or

another giving power to the State tribunal to require the performance of rules and this is used mostly in internal disputes. Allied with these are provisions based on the disputed election provisions in the Act. Two considerations arise here.

The first whether it is necessary for these controls to be vested in two tribunals and the second which of them is essential for the operation of the State systems.

Section 75 of the Queensland Act for example is designed to exclude from the disputed election provisions any registered union which is also a branch of a federal organisation. Doubts do arise as to the validity of the sections which purport to make these powers exerciseable in the case of a branch of a federal union.

13. The second question is whether it is desirable that the same issue may be litigated before two or more separate tribunals. If for example a disputed election occurs in a federal branch or what I have termed its associated body, I think it wrong that issues as to the election may be contested before both the Australian

Industrial Court and a State tribunal. Similar considerations arise on questions of seeking orders for the performance of rules. These issues usually arise in the case of factional disputes within unions and one might well have a position that member A sought an order before the Australian Industrial Court and member B an order

Solution proposed to the present problems 31

before a State tribunal. This I think is clearly undesirable and it may well be that no question of estoppel could arise.

It seems sufficient if the issues can be litigated and dealt with before one tribunal.

In an endeavour to test this I sought information concerning the use of various sections in the State of New South Wales. In recent years there have been four sets of litigation involving unions in that State which are operating both as federal branches and registered industrial unions under the State Act. The proceedings

involved rules and elections. All the litigation was conducted in the Australian Industrial Court and no embarrassment or prejudice to the State system occurred.

I have examined situations which have occurred in other States and I am satisfied the like position results.

14. In these circumstances I think it clearly quite sufficient in the case of a federal branch that there be a power of control. The important question is not who exercises the power but that it be exerciseable in a proper case. Vesting all the power in respect of federal organisations and their branches in one Court would

avoid the embarrassment of possible different judgments on the same issues in two separate tribunals. In the case of federal branches which are given, as I propose, non corporate registration under a State Act, State provisions dealing with rules and their performance and disputed elections should not apply to those bodies.

15. Allied with this question is the power which now appears in the Act and in a number of State Acts giving power to the tribunal to make an order entitling persons to membership and requiring the organisation to admit them. These powers are rarely used and again in the case of a federal branch I think it preferable

that the power be exerciseable by one tribunal only and I think it quite sufficient if there is one power able to be exercised.

In these cases I think the jurisdiction of the Australian Industrial Court should be exclusive and this should be done by an amendment to Section 147.

16. The next matter concerns information which is required by the various State Statutes to be lodged with the State Registry. In the case of federal branches or their associated bodies registered under State Acts the practice is to furnish the same information to the State Registry as is forwarded to the Australian Industrial Registrar. This requirement could be continued and the State system would then

be in receipt of the same information it now requires. 17. I contemplate then that the present difficulties, invalidities and inherent future problems could be avoided if the respective State Acts were amended to provide:

1. For a system of non corporate registration of branches of federal organisations.

2. That a federal body may apply to a State Court for registration of a branch or branches in a particular State. 3. That there was reposed in the State tribunal a discretion as to registration exercisable in the general manner I have indicated above.

4. That there was reposed in the State tribunal a discretion as to the geographical and/or industrial areas in which it would allow the federal branch to operate for purposes of the State Act.

5. That the State statutory provisions as to requirement of rules and requirements as to alteration of rules, the power to make orders directing performance of rules.

32 Solution proposed to the present problems

powers in respect of disputed elections and the power to require a registered union to admit an applicant were not to apply to registered branches of federal organisations.

6. That the federal branch lodge with the State Registry the records required to be kept and lodged in respect of the branch under the Australian Act.

7. That there should remain within the State system a power to deregister the federal branch as a non corporate registered body within its system on the same grounds as now exist with respect to other unions in that system.

8. That in exercising its discretion to register the State system should satisfy itself that there is sufficient autonomy within the branch as to matters arising in its participation in the State system and that there are funds available within the State and in the branch. It should also satisfy itself that there are officers within

the State of the branch to conduct the affairs of the branch within the State system. The current requirements as to attendance at conferences and the like should apply to such officers and the branch.

9. That the branch when registered should have the same rights as to the making and enforcement of awards, demarcation, objections to registration and the like as other registered unions.

33

Machinery provisions to implement such a system

1· The systems of arbitration all have one feature in common — that where organisations register they have an area in which they may operate allocated to them As a general rule, only one organisation is permitted to operate in an area. This is well recognised as serving the public interest. The result is that organisations have acquired jealously guarded rights to particular industrial and geographical areas.

2. They preserve this right by use of their right to object to the registration of a new organisation on the grounds that the members of an organisation seeking original registration may conveniently belong to an already registered organisation.

Care must be taken in evolving a new scheme that it operates fairly to all organisations.

3. One submission made was that a branch of a federal organisation should be entitled to registration without facing ‘conveniently belong’ objections from other unions. This is rejected as being unfair.

4. Organisations which would be expected to seek registration may be grouped in four categories:

(a) Those where the branch or the associated body had the same conditions of eligibility in the State registration as in federal registration.

(b) Those where the State conditions of eligibility are wider than the federal.

(c) Those where the State conditions of eligibility are narrower than the federal.

(d) Those where there is not in a particular State a branch or associated body of the federal organisation.

I use the term ‘associated body’ to mean a registered State industrial union which has or purports to have the same members and officers as a branch of a federal organisation in the same State and the term ‘branch’ to mean the body which functions both as a State registered union and a branch of a federal organisation.

5. In the first group the branch or associated body must have either had no objections raised to its registration or successfully contested them.

It should be entitled to registration in the same area without facing fresh con­ veniently belong objections.

6. In the second and third groups different considerations arise. In the first place it is essential for the future functioning of the systems that the conditions of eligibility for both the branch and the organisation be the same. At present an organisation may have a core of classifications common to all States with particular

additions to it in a particular State. So there may be categories 1-4 eligible for membership in all areas where the organisation functions, category 5 also eligible in Queensland, category 6 in New South Wales and so on.

34 Machinery provisions to implement such a system

I see no objection to that being continued for industrial arbitration purposes.

But problems will arise if in the organisation categories 1-4 are eligible while in a State it is desired to have category 5 eligible for membership.

At the present time one finds both examples where the branch or associated body have conditions of eligibility far wider or far narrower than those of the federal body.

Generally speaking, either an organisation or a union is entitled to protect the industrial interests of those groups of employees or employers who are within its conditions of eligibility. Those persons it may enrol as members it may protect.

But this is not so in all cases. Under the Act in an interstate industrial dispute an award may be made curtailing this entitlement (R. v Commonwealth Commission; ex parte Transport Workers’ Union of Australia 119 C.L.R. 529).

This is sometimes done less directly by the Commission, in the case of competing claims by organisations, by making an award in the dispute created by one organisation and refusing to make an award in the same industrial area in a dispute created by another organisation. Another method of achieving the same object is by an award of preference.

In the various States the same powers exist. But in New South Wales a further power is given to the Industrial Commission by Section 36 of the New South Wales Act.

That section provides a power exerciseable on the application of the Minister, an employer or an industrial union to ‘demark the industrial interests of trade unions and industrial unions’.

When such an order is made it does not operate to prevent a union enrolling members but it does prevent it representing them under the Act.

It is a more expeditious and less expensive and time-consuming method than the others.

Moreover, it allows an arbitral authority to deal with the question which is the appropriate representative body in the light of changing circumstances over the years. Examples do occur, unforeseen at the time of original registration, of techno­ logical changes, of changes in the location, nature and size of industries, in the functioning of organisations such as an abandonment of a field over a long period and then an attempted re-entry. All these make such a direct power very desirable to enable an arbitral tribunal to make any necessary adjustments to the scheme or pattern of representation of groups of employees.

No organisation of employees opposed the provision of such a power.

8. Some such problems but on a much less scale do arise with employer organisations (cf. ex parte Victorian Employers’ Federation 47 A .LJ.R . 772 at 775D). However all employer organisations which dealt with it opposed as unneces­ sary the insertion of such a provision applicable to them. In the circumstances I recommend the amendment of the Act by inserting such a power limited to organi­ sations of employees and complementary legislation by the States should also so provide.

9. With the existence of such powers the transition from the present method of registration with dual incorporation to one of non corporate registration can be

35

effected without injustice being done to union or organisation whether of a federal character or not.

10. 1 take firstly the case where the State conditions of eligibility are wider than the federal. A scheme of amalgamation of the State and federal bodies is set out in the recommended amendments. To achieve this it will be necessary for the conditions of eligibility of the federal body to be widened. To allow this auto­

matically to happen could be unfair to other unions. To refuse it could mean that all the members of the State body could not be admitted to the federal body and it would have to choose between eliminating Moore v Doyle type problems and losing a group of members who had been at least de facto members of the State branch and whose industrial interests in the State system had been protected.

Moreover, registration of the federal branch in the State sphere with a limited coverage in the place of the previously registred State body with a wider coverage would leave a group of employees unrepresented.

The scheme then contemplates that the Registrar may in approving an amalga­ mation make a demarcation order, The result would be in the ultimate that there would exist a branch of a federal body able to represent in the State sphere the members it had represented in the past, able to legally enrol those members while

the federal body would acquire no greater representational rights in the federal sphere than it had had. There would be no unfairness to any federally registered union.

So far as unions functioning solely under the State Act were concerned they could not be adversely affected because the State registered branch must have already run the challenge of conveniently belong objections.

11. Where the State conditions of eligibility are narrower than the federal, it would be unfair to unions exclusively within the State sphere to allow registration of a federal branch with a wider constitution. The federal body would have always been able to enrol to the full extent of its conditions of eligibility so no change

would result if its power to enrol continued but it did not acquire a right to represent in the State area.

On registration of the federal branch, it is contemplated that a demarcation order would be made by the State tribunal limiting the federal branch’s industrial interests under the State Act (the right of representation) to the area it previously occupied.

There would be no conflict between the two powers; one would demark interests under the Act, the other under the State Act.

12. The remaining class of case is where there does not at the present exist in a State a branch or associated body registered under the State Act.

In this type of case the federal body seeking registration for its branch would have to face the usual conveniently belong objections.

13. The continued existence of the demarcation powers would allow appro­ priate changes in the future at the discretion of the tribunals.

14. I have dealt with the machinery proposals to date on the basis that there would be an amalgamation between the federal body and the State registered branch. If this were not desired an alternative method would be the deregistration and dissolution of the State registered branch or associated body.

Either method would of course require the concurrence of the latter. The second

Machinery provisions to implement such a system

36 Machinery provisions to implement such a system

method would allow as does the first the use of the demarcation power by either tribunal to ensure no injustice was done to any other union.

15. In the submission of the Queensland Government, it was said that the proposals were ‘quite vicious’, that they were ‘unfairly loaded in favour of federal organisations’.

I reject this. I am fortified in my rejection by the fact that all unions, including a number which have only State registration, were in favour of the scheme and saw no prejudice flowing to them.

16. In addition to the recommendations on pages 31/32 I recommend that the respective State Acts be amended by providing:

(a) A power in the appropriate tribunal to demark the industrial interests under the State Act of unions registered under that Act including those with non corporate registration.

(b) A similar power to be given to the Registrar when dealing with applications for registration.

I make recommendations that the Act be likewise amended.

17. It is implicit in what I have said that the non corporate registration of a federal branch should be contemporaneous with the deregistration of the present corresponding State registered branch or associated body and the legislation should also so provide.

18. As set out in the part of the report dealing with the validity of the

proposals, Section 132 of the Act now allows persons who are not employees but are in occupations closely akin to those of the employees eligible for membership in a particular organisation to be enrolled in that organisation but does not purport and of course cannot allow such persons to be covered by awards.

The New South Wales Act both allows such persons to be enrolled as members by unions and allows awards to be made.

I have recommended that Section 132 be amended to make similar provision for employer organisations.

Unions of employers and employees registered under State Acts face similar problems. It was indeed made clear to me that in a number of cases persons who are not employers or employees, e.g. non employers conducting businesses or lorry owner-drivers who are contractors are enrolled as members.

To enable conditions of eligibility to be identical and for the reasons advanced in the section of the report dealing with invalidities, I recommend that the State Acts be amended to enable unions of employees to enrol as members persons of the classes referred to in Section 132 of the Act and that corresponding power be given to unions of employers both in New South Wales and the other States.

It is not a matter for me to consider whether any State should follow the New South Wales lead and give award making powers.

19. In the course of submissions made by the A.C.T.U. two specific new matters were raised. They were firstly that the Department of Labor should issue a summary of this Report with some advice on the steps to be taken to all organisa­ tions and secondly that an officer of the Department should be made available to

assist and advise organisations on matters arising out of the Report.

Machinery provisions to implement such a system 37

I agree with both these proposals. While the major implementation of the Report must await complementary legislation by the States, there will be matters arising under the validation provisions which can be dealt with in anticipation of that and the two proposals of the A.C.T.U. can be implemented at once with value to all concerned.

20. Before concluding this part of the Report, reference should be made to Mr K. D. Hilton.

During the course of his address, Senior Counsel assisting the Committee. Mr R. E. McGarvie, Q.C., said:

‘Again, it is fair to say that the concept of non-corporate registration or recognition within a State system of industrial arbitration of State branches of a federal union owes its origin to Mr Keith D. Hilton. Mr Hilton, who has had long experience as an industrial magistrate in South Australia, delivered a paper to the Industrial

Relations Society of South Australia on 3 May, 1971. This paper entitled "Dual Registration of Trade Unions under Commonwealth and State Acts" proposed recognition of a State branch of a federal union as a practical and effective method of overcoming the deplorable state of organisational confusion and invalidity disclosed in the decision of Moore and Doyle.

That paper was published in the Journal of Industrial Relations in 1971, volume 13 at page 297. The wide and general support given to proposals along those lines by the organised trade unions and employer bodies of the country in submissions to the Committee point of the indebtedness of the community on both sides of its industry to Mr Hilton for his proposals.’

I wish to express my complete agreement with this. During all the submissions and discussions which have been held, this is the only real basis for solution whicli has been advanced.

It is one of those dramatically simple proposals which has survived detailed criticism and consideration and emerged strengthened.

21. I recommend that the amendments at set out in Schedule ‘C’ be made to the Conciliation and Arbitration Act, 1904-1973.

38

The curing of invalidities, etc.

1. In the terms of reference the Committee was asked to report on steps appropriate to be taken in the light of its findings on the effects of the systems of registration.

2. In his opening address, Mr R. E. McGarvie, Q.C., Senior Counsel assisting the Committee, posed the issues as follows:

‘The second question, the second issue, is comprehended by later terms of reference, what is the best way of placing industrial organisations on an even keel in the sense that they will be free from the consequences and the disabilities of past invalidities? And the third is somewhat similar, except it looks forward, how to cure and overcome

future invalidities which inevitably occur in any human organisation?’

There seems unanimity that it is necessary to achieve these ends. I propose to deal primarily with the question of the appropriate amendments to the Act by which term in this part is meant the Conciliation and Arbitration Act, 1904-1973.

3. But problems and invalidities of the same nature have occurred and are present in the operations of unions registered and functioning only under a State Act.

The report of the Working Party showed agreement with this by all Departments of Labour represented and there was no disagreement in any of the submissions made.

The South Australian Act provides in Section 133 a system whereby certain actions impugning validity of proceedings are barred and in the view of the Govern­ ment of that State that provision has operated satisfactorily. There is no like pro­ vision in the other Statutes but I have been left in no doubt that invalidities have occurred in the operations of purely State unions.

4. While the present proposals are concerned particularly with organisations registered under the Act and so would apply to a federal branch after a State legislates to allow a form of non corporate registration, it will still be desirable for each State to consider legislation applying to bodies of employer? and employees with only State registration.

Most of what I say about organisations registered under the Act is applicable to all unions, both of employers and employees. There was no confident assertion that any single one at all was operating validly.

5. It has long been recognised that in the conduct of affairs of corporations invalidities do in the ordinary course of events occur. Provisions such as Section 366 of the Companies Acts and Article 89 of Table A to that Act and their predecessors reflect that need.

A like question is the subject of a very valuable discussion by Sir Owen Dixon in 1938 (1) Res Gestae page 285. It should be noted that the doctrine His Honour there

The curing of invalidities, etc. 3*)

referred to has been held not to apply to organisations registered under the Act- - Sercombe v Hall (81 C.A.R. 160).

Yet in the case of organisations which by their very nature will be controlled and operated by, in most cases, men and women not skilled in corporation or other law. no such provisions have existed. Their very nature makes them prone to invalidities.

6. One preliminary matter may be disposed of. Until recently the view was held that a rule of an organisation on a matter prescribed by the Act or regulations as required to be dealt with in the rules was necessarily mandatory. This was stated to flow from the High Court decisions in the Tramways Case (19 C.L.R. 43) and Linaker’s Case (22 C.L.R. 176).

The same view has been taken in the States {re Electrical Trades’ Union 1963 N.S.W.A.R. 796 at 807/8).

In Friend v Barnes (15 F.L.R. 184) the then Commonwealth Industrial Court held that such rules might be either mandatory or directory according to the ordinary canons of construction but in a recent judgment at least one member of the Australian Industrial Court has held the contrary.

The matter should be put beyond doubt. Since rules must be certified by the Registrar and the Court has powers of disallowance, all considerations of conveni­ ence favour the view that such a rule may be mandatory when strict compliance is necessary or directory when substantial compliance is sufficient.

The Committee will recommend an amendment of the Act accordingly.

7. A problem affecting all organisations is that the validity of a particular act will depend on the validity of what has preceded it.

An alteration of rules some twenty years ago may have been invalidly made, perhaps because the rules mandatory in form were not complied with—perhaps because the election of the rule-making body was a nullity. The rules made have been acted on subsequently until an occasion for challenge arises. Then what was

done twenty years ago and its validity must be examined.

Organisations in this sense resemble a house of cards—disturbance of one at the bottom brings the whole house tumbling down.

8. The melancholy fact is that where such a challenge has been made it has succeeded both in organisations of employees and employers. In the vast majority of cases the acts have been done in complete good faith. In a recent case, Smithers J. described what is the position in that vast majority—

‘It is a feature of this case that although strongly fought there has been no suggestion from beginning to end of any mala tides on the part of any officer concerned with the conduct of the election. And I accept without reserve that what was done in this case was referable either to a misunderstanding of the rules or to following what was

believed to be established practice.’ (re Election in Australian Glass Workers’ Union 14/8/1973)

This is an intolerable position for any organisation—the equivalent I suppose of a seat on a nuclear bomb.

9. In a number of cases it has been necessary for events occurring some forty years or more ago to be investigated. So in Moore v Doyle 15 F.L.R. 59, events occurring in 1926-8 were examined in 1969. In the Electrical Trades’ Union Case

40 The curing of invalidities, etc.

1963 N.S.W.A.R. 796, events occuring as far back as 1917-18 were crucial to ascer­ tain the true position of a union in 1963.

After such a lapse of time, the officers concerned are often dead, records incom­ plete, if not destroyed, and recollections very faulty. Clearly there should be a reasonable period fixed after which any acts done should be deemed to have been done validly and after which they should be immune from challenge.

10. The principles which have been applied in determining the form of amendments are as follows:

(a) Any act except those referred to in (b) validated must have been done in good faith.

(b) After a period of four years all acts are validated unless this would cause substantial injustice.

(c) There must be power in a tribunal to except an act from the validating provi­ sion if validating it would work some substantial injustice.

11. In addition to these validating provisions there are special provisions made necessary by the problems specifically arising from the system of dual incorporation.

These include cases where by confusion arising from different conditions of eligibility persons have believed that they were members of an organisation and have so acted and been treated. They may have voted in elections or even been elected to and held office acting bona fide but nonetheless not in accordance with the law. The bodies to which they were elected have in law not been properly elected and their proceedings consequently nullities.

The Committee proposes validations of these.

12. Two specific powers are then necessary. By reason of these invalidities a part of an organisation may have become defunct and there may in the rules be no way of resuscitating it. Often one, two or even more branches of an organisation may have become defunct yet a quorum of the rule-making and controlling body may require a representative from each branch to be present before it can validly

transact business.

There are many like cases and it seems the best solution to give power to the Industrial Court to allow steps for revival of the organisation or part of it.

13. There is then the question of membership. Doubts exist whether there has been a valid joining of organisations by members because of the use of the wrong applications for membership or other failures to comply with the rules. This too is best dealt with by giving power to the Australian Industrial Court to order that persons be members. The safeguard provided is a requirement for notice to any

member and a right for him to be heard.

A summary of the proposed amendments is as follows:

1. New Section 171A This is a definition section. It defines two terms. The first, ‘collective body’, which means any of the bodies exercising administrative or policy-making powers within a branch or within the organisation. The second term defined is ‘invalidity’

and it is defined as including nullity and any invalidity resulting from an absence

The curing of invalidities, etc. 41

of a quorum or the like or caused by the fact that the collective body as defined or some one or more 0f them or a person holding an office were not duly elected. A number of matters defining the irregularities are then set out and attempt to cover all types of relevant irregularities.

2. New Section 171B

This validates all acts done in good faith by a collective body or a person hold­ ing an office in an organisation or branch. Acts done in good faith are to be valid notwithstanding any invalidity afterwards discovered in elections or appointments or the making of rules. In sub-section (2) there is a requirement

of good faith in both a person purporting to act in a collective body or as an officer and a further requirement that he should have been treated by officers or members as being a member of the collective body or as holding the office. The sub-section then prescribes that good faith is to be presumed until the

contrary is proved and that knowledge of facts from which an invalidity arises is not of itself to be treated as knowledge that the invalidity exists. The invali­ dity is to be treated as discovered when it becomes known to a majority of the members of the committee of management. The section is to apply to an act whether done before or after the commencement of this Act. It is not to affect

the operation of the disputed elections clauses nor is it to validate an expulsion, suspension or imposition of a fine on a member of the organisation.

3. Section 171C gives the Australian Industrial Court power to rectify or cause to be rectified an invalidity. It provides that before making such an order the Court shall satisfy itself that no substantial injustice would be done.

4. Section 171D is a section giving power to the Court to resuscitate any part of an organisation which has ceased to exist and where there are no practicable means within the rules of the organisation by which it can be reconstituted. A similar power is given where an office or position in an organisation or branch is

vacant and again there are no practicable means under the rules whereby it may be filled. Again the Court is to satisfy itself that by the making of the order no substantial injustice would be done.

5. New Section 171E provides a method where a person who is eligible for member­ ship and has acted in good faith as and been treated as a member may be declared to be entitled to be treated as a member from the date of his original application. This again is made subject to notice to any member concerned for

any member concerned to be heard before an order is made.

6. New Section 171F This provides that upon the expiration of four years from the doing of an act by a collective body or a person holding office or an election or rule alteration shall be deemed to be valid for all purposes. It is expressed not to limit the

powers conferred on the Court by Section 140 whereby a rule disallowed as unreasonable, etc. The period of four years is selected because it covers a period normally covering an election, the period for which office is held after the elec­

tion and a further period. If a challenge is to be made it is felt that the facts upon which the challenge is based will almost invariably have come to notice during this period of four years.

42 The curing of invalidities, etc.

7. New Section 171G This section enables the Court on application if satisfied that substantial injustice would be done to order that Section 17IB the validating section and Section 171F the time limitation section shall not apply in particular cases. This is to meet any possible case of substantial injustice which may arise through fraud or the like. Nothing has come to the notice of the Committee to support a view that there are such cases but it is felt that since it is impossible to know in advance that there would be no such cases a power such as this should repose in

a tribunal in case it may be necessary.

I recommend that the amendments as set out in Schedule ‘D’ be made to the Conciliation and Arbitration Act, 1904-1973.

43

Summary of report

Mr Justice Sweeney was appointed in February 1974 to inquire into systems of registration of organisations.

This followed the highlighting of the problems associated with dual registration and incorporation of organisations under Federal and State arbitration systems in a judgment of the Commonwealth Industrial Court in 1969 in the case of Moore v Doyle.

After the judgment, a Working Party of representatives of Departments of Labour was set up, but no agreement reached.

The Committee examined the systems in all States and the federal system. It held discussions with representatives of State Departments of Labour, organisations of employees and employers and individuals and invited and received written and oral submissions.

The problems were twofold—firstly to devise a system of registration which would prevent the type of problems outlined in Moore v Doyle from arising again and secondly to provide a system of curing invalidities which now exist or may still arise.

The South Australian Government proposed a system of recognition of branches of federal organisations which would not incorporate the branch or make it a separate legal entity. This was in general supported by the Australian Department of Labor and the unions and the employer organisations. Included in these were

the A.C.T.U. and the National Employers’ Policy Committee.

The report notes the unusual unanimity and praises the realistic approaches made. The New South Wales Government argued that the Australian Parliament could not, under the Constitution, legislate to enable branches of federally registered organisations to be registered or recognised under State industrial laws. For this

reason it argued that the present system must be maintained although it had led to problems both affecting organisations and, in some cases, directly affecting the public, as in the case of the oil strikes resulting from the disputes between the Transport Workers’ Unions. It also argued that Section 132 of the Australian Act

was invalid. In essence the Western Australian and Queensland Governments also sought the continuance of the present systems. They neither supported nor opposed the constitutional arguments of the State of New South Wales, although, if accepted,

those arguments involved the conclusion that in each of the four States, branches of federal organisations had been registered in the past and that those registrations were invalid.

The Committee examined the arguments in detail and concluded that the Australian Parliament could legislate to enable branches of federal unions to be

44 Summary of report

registered under State Industrial Arbitration Acts if this registration did not give separate incorporation to the branch and did not affect the powers given to the parent body under the Australian Act.

The present State Acts do these things and consequently the Committee agreed with the New South Wales submission that the existing registrations under all State Acts of branches of federally registered organisations were invalid.

The Committee then considered the attack on Section 132 as amended in 1973. The effect of the amendment was to allow organisations of employees to enrol as members persons following a similar occupation but who were not employees providing the organisation remained effectively representative of its employee members.

Organisations of employers sought a similar amendment to cover their position.

After consideration of the arguments, the Committee formed the view that the amendment was valid and that the employers’ request should be acceded to.

One importance, irrelevant to the question of validity, was that both the Transport Unions concerned in the New South Wales disputes expressed the belief that a combination of the amendment to Section 132 and a system of registration without incorporation under State Acts would enable them to amalgamate and so these differences and industrial disputes would cease.

Consideration was then given to a scheme which would enable branches of federal organisations to be validly registered.

Amendments are proposed to the Australian Act to enable this to be done. Amendments to State Acts are recommended which are designed to ensure that State tribunals will have sufficient control over branches so registered to enable State systems to function fully and effectively. The system is termed one of ‘non corporate’ registration.

The State tribunals will have very much the same controls as at present, except that in applications to disallow rules, order the performance of rules, order the admission of persons to membership and dealing with disputed elections jurisdiction should be exclusive to the Australian Industrial Court. It is necessary that jurisdic­ tion exists. It is undesirable that the same issue should be able to be litigated before two separate tribunals with two different and, perhaps, embarrassingly different results.

A form of machinery to enable branches to be registered in a manner which will not put any branch or federal union or any union solely registered in a State in any better or worse position because of the change is then outlined.

The key to it is a provision for demarcation of the industrial interests of organisa­ tions under the Australian Act by the Australian Commission and the industrial interests under a State Act of branches and/or unions registered only under a State system.

The Committee then turns to the question of curing invalidities.

It records ‘the melancholy fact’ that reported cases disclose that any investigation of the affairs of an organisation seems to reveal nullities and irregularities in the conduct of the organisation. This applies to both employer and employee organisa­ tions, to State registered and federally registered unions alike.

Summary of report 45

It refers to the fact that the validity of any given act may depend on all that has gone before and that the validity of acts done up to forty years ago have had to be examined.

An organisation is likened to a house of cards—if a bottom card is withdrawn, as in invalidity, the whole structure may collapse.

Organisations particularly of employees are conducted by men and women who may be expected to have little expertise in corporation law.

Special provisions have been made in Uniform Companies Acts to cure invalidities.

In the case of other corporations the law has evolved a doctrine of the validity of acts of de facto officers which do not apply to organisations under State Acts or the Australian Act.

A series of amendments to the Australian Act is then proposed which are designed essentially:

(a) to validate acts of persons being or purporting to be officers and committees, where the acts are done in good faith.

(b) to allow the Court to make orders validating and correcting irregularities.

(c) to provide that actions done more than four years ago are to be deemed to have been done validly.

The provisions contain safeguards enabling the Court to except from validating provisions a particular action if validating it would cause substantial injustice.

A recommendation is made that State Acts be correspondingly amended to cover the position of irregularities and invalidities which have occurred in State registered unions.

The success of the proposals will depend on legislation amending the Australian Act and then complementary legislation amending the State Acts.

47

Schedule ‘A’

South Australia

Chamber of Commerce and Industry Federated Clerks’ Union of Australia, South Australian Branch Trades and Labour Council Employers’ Federation of South Australia

Public Service Association of South Australia Australian Workers’ Union, South Australian Branch Association of Architects, Engineers, Surveyors, and Draughtsmen of Australia, South Australian Branch

Shop Distributive and Allied Employees’ Association, South Australian Branch Departmental representatives Metal Industries Association of South Australia Industrial Commission of South Australia

Federated Clerks’ Union of Australia, South Australian Branch

Queensland

Departmental representatives Industrial Relations Society of Queensland Australian Workers’ Union, Queensland Branch Industrial Commission of Queensland

Meat and Allied Trades Federation of Australia, Queensland Branch Trades and Labor Council

Victoria

Employer Organisations representatives Departmental representatives (Australian Government) Australian Council of Trade Unions

New South Wales

Employers’ Federation of New South Wales The Master Carriers’ Association of New South Wales Labour Council of New South Wales Departmental representatives

Chamber of Manufactures of New South Wales Public Service Association of New South Wales Nurses’ Association of New South Wales Association of Professional Engineers, Australia

Health and Research Employee’s Association of Australia Australian Public Service Federation

48 Schedule ‘A’

Australian Woolgrowers and Graziers’ Council Australian Workers’ Union Meat and Allied Trades Federation of Australia Transport Workers’ Union of Australia, New South Wales Branch Metal Trades Industry Association of Australia Amalgamated Metal Workers’ Union of Australia

Federated Ironworkers’ Association of Australia

Western Australia Industrial Relations Society of Western Australia Industrial Commission of Western Australia Departmental representatives Employers’ Federation of Western Australia and Metal Industries Employers’ Association of Western Australia

Association of Professional Engineers Australia, Western Australian Branch Trades and Labour Council

Schedule 6B’

Australian Council of Trade Unions Australian Department of Labor Australian Workers’ Union, New South Wales Branch Chamber of Commerce and Industry, S.A. Incorporated

Department of Labour and Industry, South Australia Meat and Allied Trades Federation of Australia Metal Trades Industry Association of Australia Models and Mannequins’ Guild, New South Wales

Municipal Officers’ Association of Australia National Employers’ Policy Committee Real Estate Salesmen’s Association of New South Wales Shop Distributive and Allied Employees’ Association, New South Wales Branch

Transport Workers’ Union of Australia Transport Workers’ Union of Australia, New South Wales Branch Western Australian Employers’ Federation (Incorporated) Association of Professional Engineers, Australia

Department of Industrial Affairs, Queensland State of New South Wales State of Western Australia Association of Professional Engineers, Australia, Western Australian Branch

Australian Bank Officials’ Association, Rural Bank of New South Wales Division Australian Medical Association, New South Wales Branch Australian Public Service Federation Council of Commonwealth Public Service Organisations

Public Service Association of New South Wales

50

Schedule 6C’: Draft amendments to the Conciliation and Arbitration Act, 1904-1973

1. Section 136 of the Principal Act is amended by omitting the words ‘for the purposes of this Act’.

2. Section 146 of the Principal Act is amended by omitting the words ‘for the purpose of this Act’ and ‘or other’.

3. Section 132 of the Principal Act is amended by:

a. Deleting subsection 1(a) and inserting in lieu thereof the following:

‘(a) Any association the members of which include employers in or in connexion with any industry who have in the aggregate throughout the six months next preceding the application for registration employed on an average taken per month not less than one hundred employees in that industry and the other members if any of which are —

(i ) officers of the association (ii) persons other than employees who carry on a business in or in connexion with that industry (iii) persons who when admitted to membership were employers in or in

connexion with that industry and who have not resigned or whose membership has not been terminated but does not include an association that has members referred to in sub­ paragraphs (2) or (3) unless the association is effectively representative of the members who are employers in or in connexion with that industry. (b) Any employer who has throughout the six months next preceding the application

for registration employed on an average taken per month not less than one hundred employees in that industry.’

b. By adding to subsection 1 (b) (ii) after the word ‘industry’ the words ‘otherwise than as employers’.

c. By adding to subsection 1(c) (ii) after the word ‘employees’ the words ‘or employers’.

d. By relettering paragraph (b) of subsection 1 as paragraph (c) and paragraph (c) as paragraph (d).

4. Section 132 of the Principal Act is amended:

a. By renumbering subsection (3) as subsection (4).

b. By adding new subsection (3):

‘A rule of an association or organisation dealing with matters so prescribed or dealing with matters required in this Act to be complied with as conditions for registration may be mandatory or directory.’

5. The Principal Act is amended by adding a new Section 136A:

‘Where it is not contrary to the rules of an organisation, it may participate in the systems of conciliation and arbitration or of wages boards or like systems established

Schedule ‘C’

51

by the States of the Commonwealth so long as that participation does not involve it or part of it becoming incorporated or a legal entity under State law. Where an organisation so participates its rules shall specify that the Secretary of the branch of the association in such State shall be the person to sue or be sued in respect of any

acts or omissions arising under a Statute establishing any such system in a State.'

6. Section 147 of the Principal Act is amended by inserting the following:

‘The jurisdiction of the Court under Section 140, Section 141, Section 144 and Part IX of this Act is exclusive of the jurisdiction of a State Industrial Authority.'

7. Add new Part VIIIB:

‘158V. In this Part —

(a) The term “State Act” means one of the following Acts as amended from time to time — The Industrial Conciliation and Arbitration Act, 1961 to 1964 of the State of Queensland

The Industrial Arbitration Act, 1940 of the State of New South Wales The Industrial Conciliation and Arbitration Act, 1972 of the Stale of South Australia The Industrial Arbitration Act, 1912-1968 of the State of Western

Australia

(b) The term “associated body” means an organisation registered under a State Act as an industrial union or an association as the case may be or a branch which has purported to function as an industrial union or association under a State Act or a registered industrial union or association and which is or purports to be composed of substantially the same members and which has or purports to have substantially the same officers as a branch of an organisation in the same State.

(c) “Amalgamation” means the carrying out of arrangements in relation to an organisation and an associated body under which it is intended that — (1) a branch of the organisation is to obtain non corporate registration under a State Act;

(2) the associated body is to be deregistered under a State Act; (3) members of the associated body are to become members of the organisation; (4) the property of the associated body is to become the property of a

branch of the organisation or the organisation; and (5) the liabilities of the associated body are to be satisfied from the property of a branch of the organisation.

158W. An organisation and an associated body may amalgamate in the manner set out in this Part.

158X. (1) The committee of management of the associated body and the committee of management of the organisation shall each pass a resolution proposing amalgamation and the terms of such amalgamation.

(2) Application shall be made to the Industrial Registrar for approval of such amalgamation.

(3) Objection may be made to the amalgamation so far as it involves an alteration to the description of the industry in connexion with which the organisation is registered or the conditions of eligibility for membership of the organisation by an organisation, a member of the associated body or a registered industrial union or association in the State in which the

associated body functions on the grounds that an organisation to which the members of the associated body, whose eligibility for membership

Schedule ‘C’

would depend on the alteration, might conveniently belong has already been registered.

(4) Objection may be made to an amalgamation by a member of the associated body on the grounds that — (a) the provisions of this section have not been complied with (b) the amalgamation would do substantial injustice to the members of

the associated body.

(5) The Registrar may where the amalgamation involves an alteration to the rules of an organisation in so far as they relate to conditions of eligibility for membership or the description of the industry in connexion with which the organisation is registered, as a condition of approving the amalgamation, require the applicant organisation to consent to an order under Section as to such employees or classes or groups of employees and in such geographical or industrial areas as he thinks fit.

(6) The Registrar shall not approve an amalgamation unless he is satisfied as to arrangements made concerning any property and any liabilities of the associated body.

(7) On the date on which the amalgamation is approved all members of the associated body shall become members of the organisation and shall be deemed to have been members for the same period as they were then members of the associated body.

(8) (a) The Registrar may determine what notice is to be given to other persons of the application and whether, upon whom and how it should be served and whether it should be advertised in any newspaper. (b) The Registrar in giving any such advice shall fix a time for the

lodging of objections. If any objections are lodged or if the Registrar deems it advisable he shall fix a date of hearing and shall determine to whom and in what manner notice of the date and place of hearing shall be given.’

The Principal Act is further amended by inserting new Section 133A:

Tn addition to the conditions referred to elsewhere in this Act, the conditions to be complied with by associations divided into branches applying for registration as organisations and by organisations divided into branches shall include a condition that the rules of the association or organisation shall provide:

(1) (a) That there shall be a fund (hereinafter called “the Federal Fund”) which shall be managed and controlled by the organisation. (b) That each branch shall have a fund (hereinafter called “the Branch Fund”) of the particular branch which shall be managed and controlled by that

branch.

(2) The Federal Fund shall consist of — (a) Any real or personal property of which, at the date on which this Act received the Royal Assent or thereafter, the federal body of the organisation by the rules or by any established practice not inconsistent with the rules or

in the absence of any limited term lease bailment or arrangement would have the right of custody, control or management. (b) In the case of an organisation where the rules prescribe for the payment of capitation fees by a branch to an organisation, such fees.

(c) In the case of an organisation the rules of which prescribe for the payment of proportions of the whole or part of the entrance fees, subscriptions, fines, fees or levies by a branch to the organisation, the amounts of such payments.

(d) Any interest, rents, dividends or other income derived from the investment . or use of the fund.

Schedule ‘C’ 53

(e) Any superannuation or long service leave or other fund operated or controlled by the union for the benefit of its officers and/or employeee. (f) Any sick pay, accident pay, funeral fund, tool benefit fund or like fund operated by a federal organisation for its members.

(g) Any property acquired or mainly acquired by the money or other assets of the Fund. (h) The proceeds of any disposal of parts of the Fund. (3) A Branch Fund shall consist of —

(a) Any real or personal property of which, at the date on which this Act received the Royal Assent or thereafter, the Branch of the organisation by the rules or by any established practice not inconsistent with the rules or in the absence of any limited term lease bailment or arrangement would have

the right of custody control or management.

(b) The amount of entrance fees, subscriptions, fines, fees or levies received by a branch less the proportion if any of such amounts payable by a branch to the organisation.

(c) Any interest, rents, dividends derived from the investment of the fund.

(d) Any superannuation or long service leave fund operated or controlled by the branch for the benefit of its officers and/or employees. (e) Any sick pay, accident pay, funeral fund, tool benefit fund or like fund operated by the branch for the benefit of its members. (f) Any property acquired or mainly acquired by the money or other assets of

the fund.

(g) The proceeds of any disposal of parts of the fund. (h) Paragraphs (a) (c) (d) (e) (f) and (g) of this sub-rule shall not be altered except with the consent of the branch concerned.

(4) An organisation may apply to the Registrar for exemption from this requirement or any part thereof on the grounds that its rules already make adequate and reasonable provision for its funds including branch funds having regard to its functioning under this Act and its participation in any State system of industrial

conciliation and arbitration.’

9. Section 140 of the Principal Act is amended by inserting the following new subsection:

‘(d) shall be such as to provide for the autonomy of the branch in matters affecting members of the branch only and matters concerning the participation of the branch in any State industrial conciliation and arbitration system.’

10. Section 139 of the Principal Act is amended by inserting after sub­ section (4) the following subsection:

‘(5) The Registrar shall in addition to any other relevant matters, have regard to the question whether there is an associated body of the applicant organisation registered under a State Act and whether the reason the change is sought is to enable the organisation to represent under a State Act and this Act the class of

persons who would if the change were consented to, become eligible for membership. (6) In the case of an alteration to a rule of a branch the Registrar shall before consenting or certifying as the case may be, give notice of the proposed change

to the Industrial Registrar of the State in which the branch operates and if so requested shall consult with that Registrar.’

11. The Principal Act is amended by inserting the following section:

*50A. The Commission may on the application of an organisation or employer or

54 Schedule ‘C’

the Minister make an order providing that an organisation of employees shall have the right to represent in respect of all or some industrial interests under this Act a class or group of employees either generally or in such geographical

or industrial areas as it may specify to the exclusion of another organisation or organisations.’

12. Section 141 of the Principal Act is amended by inserting the following subsection:

‘(10) In this section “election” includes a purported election which is in fact a nullity.’

Schedule 6D ’: Draft amendments

55

1· Section 3 of the Principal Act is amended by inserting after the words ‘Part IX—Disputed Elections in Organisations (Sections 159-171) ’ the words—

‘Part IXA—Validating Provisions for Organisations (Sections 171A-171G)'

2. After Part IX of the Principal Act the following Part is inserted:

‘Part IXA—Validating Provisions for Organisations 171A. In this Part, unless the contrary intention appears— “collective body” in relation to an organisation means the committee of management or any conference, council, committee, panel or other body of or

within the organisation; in relation to a branch of an organisation means the committee of management or any conference, council, committee, panel or other body of or within the branch. “invalidity” includes nullity and includes any invalidity or nullity resulting from any omission, defect, error, irregularity or absence of quorum or caused by the fact that—

(a) the members or one or more members of a collective body of an organi­ sation or branch of an organisation, or the persons or one or more of the persons purporting to act as the members of such collective body, or a person holding or purporting to hold an office or position in an organi­ sation or branch—

(i) have or has not been elected or appointed or duly elected or appointed as such members or member or to such office or position:

(ii) have or has purported to be elected or appointed as such members or member or to such office or position by an election or appoint­ ment that was a nullity; (iii) were or was not entitled to be elected or appointed as such members

or member or to such office or position; (iv) were or was elected or appointed or purported to be elected or appointed where one or more or all of the persons who took part in the election or appointment or the purported election or appoint­

ment was or were not entitled to do so; (v) were or was not a member of the organisation; (vi) were or was elected or appointed or purported to be elected or appointed where one or more or all of the persons who took part

in the election or appointment or the purported election or appoint­ ment was or were not members of the organisation; or (b) persons took part in the making or purported making or the alteration or purported alteration of the rules of an organisation or branch, as officers or voters or otherwise who were not entitled to do so or who were not members of the organisation and “invalid” has a corresponding meaning.

Schedule ‘D’

171B. (1) Subject to this section and to section 171G all acts done in good faith ■ — (a) by a collective body of an organisation or branch of an organisation or by persons purporting to act as such collective body; (b) by a person holding or purporting to hold an office or position in an

organisation or branch shall be valid notwithstanding any invalidity that may afterwards be discovered in— (i) the election or appointment of the collective body or any member

thereof or of the persons or any of the persons purporting to act as the collective body; (ii) the election or appointment of the person holding or purporting to hold the office or position; (iii) the making of the alteration of a rule of the organisation or branch.

(2) For the purposes of this section— (a) a person shall not be treated as purporting to act as a member of a collective body of an organisation or as the holder of an office or position in the organisation unless he has, in good faith, purported

to be, and has been treated by officers or members of the organisation as being such member or as holding such office or position; and (b) a person shall not be treated as purporting to act as a member of a collective body of a branch of an organisation or as the holder of an

office or position in the branch unless he has, in good faith, purported to be, and has been treated by officers or members of the branch as being such member or as holding such office or position.

(3) For the purposes of this section— (a) an act is to be treated as done in good faith until the contrary is proved; (b) a person who has purported to be a member of a collective body of

an organisation or branch is to be treated as having done so in good faith until the contrary is proved; and (c) knowledge of facts from which an invalidity arises is not of itself to be treated as knowledge that the invalidity exists; (d) an invalidity in—

(i) the election or appointment of a collective body of a branch of an organisation or any member of such collective body; or (ii) the election or appointment of the persons or any of the persons purporting to act as a collective body of a branch; (iii) the election or appointment of a person holding or purporting

to hold an office or position in a branch; (iv) the making or the alteration of a rule of a branch shall not be treated as discovered before the earliest time proved to be a time when the existence of the invalidity was known to a majority of the members of the committee of management of the

branch or to a majority of the persons purporting to act as such committee of management; and (e) an invalidity in any other election or appointment or making or alteration of a rule to which this section applies shall not be treated

as discovered before the earliest time proved to be a time when the existence of the invalidity was known to a majority of the members of the committee of management of the organisation or to a majority of the persons purporting to act as such committee of management.

(4) This section applies—

Schedule ‘D’ 57

(a) to an act whenever done, including an act done before the date of the commencement of the Act, 1974

(b) in relation to an organisation which is an association, to an act done in or in connexion with the association before the date on which it was registered as an organisation.

(5) Nothing in this section affects the operation of Part IX of this Act.

(6) Nothing in this section validates the expulsion or suspension of, or the imposition of a fine or any other penalty upon, a member of an organi­ sation, which would not have been valid in the absence of this section.

171C. (1) Where any invalidity has occurred in the management, administration, elections, appointments or the making or alteration of the rules of an organisation or a branch of an organisation, the Court— (a) may on the application of the organisation, a member of the organisa­

tion or any interested person, make such order as it thinks fit to rectify or cause to be rectified or to negative or to modify or cause to be modified the consequences in law of any such invalidity, or to validate any act, matter or thing rendered invalid by or as a result

of any such invalidity; (b) shall before making any such order satisfy itself that such an order would not do substantial injustice to the organisation or to any member or creditor of the organisation or to any person having

dealings with the organisation; (c) where any such order is made, may give such ancillary or conse­ quential directions as it thinks fit; and (d) may determine what notice, summons or rule to show cause is to be

given to other persons of the intention to make such an order, and whether and how it should be given or served and whether it should be advertised in any newspaper.

(2) This section applies— (a) to an invalidity whenever occurring, including an invalidity occurring before the date of the commencement of the Act, 1974; (b) in relation to an organisation which is an association, to an invalidity

occurring in or in connexion with the association before the date on which it was registered as an organisation.

171D. (1) (a) Where— (i) a branch of an organisation; (ii) a collective body of an organisation or branch of an organisa­ tion; or (iii) any other part of an organisation or branch has ceased to exist or to function effectively and there are no prac­ ticable means under the rules of the organisation or branch by which

it can be reconstituted or enabled to function effectively; or (b) Where an office or position in an organisation or branch is vacant and there are no practicable means under the rules of the organisation to fill the office or position the Court may on the application of the

organisation or any member of the organisation by order A. authorise any collective body of the organisation or branch or any officer or officers of the organisation or branch to take the action specified in the order to reconstitute the branch, collective

body or part or to enable it to function effectively; B. alter the rules of the organisation or branch in such manner as it thinks fit to enable the action specified in the order to be taken.

58 Schedule ‘D ’

(2) Before making any order under this section the Court shall satisfy itself that such an order would not do substantial injustice to the organisation or to any member of the organisation.

(3) Where any such order is made the Court may give such ancillary or consequential directions as it thinks fit.

(4) The Court may determine what notice, summons or rule to show cause is to be given to other persons of the intention to make any such applica­ tion or of the intention to make such an order, and whether and how it should be given or served and whether it should be advertised in any newspaper.

171E. (1) Where a person not being a member of an organisation but being eligible for membership applies to be admitted as a member of the organisation and has up to the time of application acted in good faith as and been treated by the organisation as a member, he is entitled to be admitted to membership and treated by the organisation and its members as though he had been a member during the whole of the time when he acted as and was treated by the organisation as a member and during the whole of the time from the time of his application to the time of his admission; and (2) Where a question or dispute arises as to the entitlement under this section

of a person to be admitted as a member and to be treated as though he had been a member during the time referred to in the preceding sub­ section, that person, a person who is or desires to become the employer

of that person or the organisation may apply to the Court for a declara­ tion as to the entitlement of that firstmentioned person under this section.

(3) Subject to subsection (5) the Court has jurisdiction to hear and determine an application under the last preceding subsection and may noth withstand­ ing anything contained in the rules of the organisation concerned, make such orders (including mandatory injunctions) to give eflect to its determination as it thinks fit.

(4) The orders which the Court may make under the last preceding subsection include an order requiring the organisation concerned to treat a person to whom subsection (1) applies as being a member of the organisation and as having been a member during the time referred to in that subsection.

(5) Where an application is made to the Court under this section— (a) if the application is made otherwise than by a person whose entitle­ ment is in question — that person shall be given an opportunity of being heard by the Court; and (b) if the application is made otherwise than by an organisation — the

organisation concerned shall be given an opportunity of being heard by the Court.

171F. (1) Subject to this section and to Section 171G, upon the expiration of four years from — (a) the doing of an act — (i) by, or by persons purporting to act as a collective body of an

organisation or branch of an organisation and purporting to exercise power conferred by or under the rules of the organisa­ tion or branch; (ii) by a person holding or purporting to hold an office or position

in an organisation or branch and purporting to exercise power conferred by or under the rules of the organisation or branch; (b) the election or purported election or the appointment or purported appointment of a person to an office or position in an organisation

or branch;

Schedule ‘D’ 59

(c) the making or purported making or the alteration or purported alteration of a rule of an organisation or branch; the act, election, purported election, appointment, purported appoint­ ment, making or purported making or alteration or purported alteration

of the rule shall for all purposes be deemed to have been done in compliance with the rules of the organisation or branch.

(2) The operation of this section shall not affect the validity or operation of any order, judgment, decree, declaration, direction, verdict, sentence, decision or similar judicial act of the Court or any other court made before the expiration of such four years.

(3) This section applies to an act, election, purported election, appointment, purported appointment, making or purported making or alteration or purported alteration of a rule — (a) done or occurring before the date of the

Act, 1974.

(b) in relation to an organisation which is an association, done or occurring in or in connexion with the association before the date on which it was registered as an organisation.

(4) This section shall not in any way limit or affect the powers conferred on the Court by Section 140 of this Act.

171G. (1) The Court may order — (a) that Section 171B shall not apply to an act referred to in that section; or (b) that Section 171F shall not apply to an act, election, purported

election, appointment, purported appointment, making or purported making or alteration or purported alteration of a rule referred to in that section if the Court is satisfied that such application would do substantial

injustice to the organisation or to any member or creditor of the organisation or to any person having dealings with the organisation.

(2) If the Court makes an order under subsection (1) then Section 171B or Section 171F shall in accordance with such order not so apply.

(3) Where the Court makes an order under subsection (1) it may thereupon exercise its powers under Section 171C.

(4) The Court may make an order under subsection (1) or exercise the powers referred to in subsection (3) on the application of the organisa­ tion, a member of the organisation or any interested person.

(5) The Court may determine what notice, summons or rule to show cause is to be given to other persons of the intention to make any such application or of the intention to make such an order or to exercise such powers, and whether and how it should be given or served and whether it should be

advertised in any newspaper.