No winners as Ports of Auckland dispute drags on

THE DOMINION POST - SATURDAY 31 MARCH 2012

The Ports of Auckland dispute still has a long way to run. It is almost certain to create a lot more litigation and no doubt some new law.

As it continues, readers will be asking themselves – who has tactically handled the dispute best? What are both sides after and what is the legal strength of each side's position?

Turning first to the tactics, if Ports of Auckland wished to end the direct employment of its staff and instead engage contractors then it has picked the very worst time to do that.

Tactically, it would have been much better to have acted on that issue during the currency of the collective employment agreement rather than when it had expired and a new agreement was under negotiation.

There are four advantages to this tactic. In the first place, the workers would not have been able to take strike action.

Second, Ports of Auckland could most certainly have contracted out the work if it had a case to prove it was more efficient to do so. I have no doubt it will have such a business case.

The third advantage of contracting out work during the currency of a collective agreement is that while you are still required to comply with the statutory principles of good faith, you don't get into arguments about bargaining in good faith.

It is one thing for the sides to slug out the issues with strikes and lock-outs, mediations and facilitation meetings. It is quite another thing for the employer to effectively sack virtually the whole staff and end the bargaining that way. As you will see, moving to casualise the workforce during bargaining may be a step too far to comply with good faith.

The fourth advantage is that that the dispute would have been resolved quite quickly and this would have avoided the involvement of Auckland Council. As time passes, the pressure on the council increases and is likely to lead to a collapse of council support for the Ports of Auckland.

The main legal issue in the dispute as it currently stands, is whether legally you can restructure to the extent of dismissing the workforce during collective employment negotiations.

In 2002 the Employment Court said in a case involving Carter Holt Harvey that a site restructure can occur during collective employment negotiations.

The parties were negotiating for a new collective agreement and in the course of negotiations the employer announced consultation for a restructuring. The restructuring was to include the contracting out of a business unit (Mill Maintenance). There was the potential for one-third of the workforce to be made redundant.

My understanding is that Ports of Auckland is proposing to restructure the workforce virtually in its entirety. If this complied with good-faith bargaining obligations, then it would be easy for any employer in the future to deal with a strike by sacking the workforce and contracting all of the work out, effectively on potentially inferior terms and conditions. This would effectively defeat the bargaining process.

To my knowledge, there is no case on point but the courts may well find that in this instance Ports of Auckland is taking things too far during the bargaining process. Still, the tide does not all go one way. In the long run, the workers at Ports of Auckland will lose if the company remains determined to hold its position. Eventually, the Employment Relations Authority may bring bargaining to an end and at that point it is likely that Ports of Auckland will be able to carry out its restructure.

Media coverage of the unfolding events is variable. However, there can be no doubt the workers played some role in bringing about the situation that they now find themselves in. It may be that they pushed too hard for too long.

The striking workers may ultimately be saved by the soft underbelly of Auckland Council. I have not the slightest doubt that the politically left-aligned members of the council are facing immense pressure to intervene and rescue the workforce.

Readers may be aware of a side issue being decided by the Employment Court this week.

Ports of Auckland recently agreed to go back to mediation and not to progress contracting out for a month. The workers then held a stop-work meeting and agreed to return to work. Ports of Auckland then gave the union 14 days' notice of a lockout.

The workers wanted to return to their jobs immediately – certainly before the lockout came into effect. However, Ports of Auckland did not want them back and refused to let them in.

Where an employer has reasonable grounds for believing health and safety is at risk, the 14-day notice period for lockouts does not appear to apply.

I understand that in keeping its workers offsite Ports of Auckland has relied on two arguments. Those in the volunteer workforce are worried about their wellbeing and safety if the traditional workforce returns to the waterfront. Further, it takes some time to get rosters in place, all the more so given the level of disruption that has occurred on the waterfront.

Both arguments are far from compelling. The health and safety argument is weak.

Most often during a strike there are other people who work but when the dispute is settled everyone returns to business as normal. Furthermore, it seems unlikely that it would take 14 days to put new rosters in place.

The courts will be asked to make a ruling on whether the workers should return to work during the 14-day notice period.

What is happening on the Auckland waterfront is interesting both strategically and legally. Both sides have able legal counsel, now supplemented by each side instructing a Queen's Counsel. Interestingly, Auckland Council has also instructed a third Queen's Counsel to advise them on this issue. A huge bitter clash of industrial wills that common sense seems unable to resolve is forcing decision-making on the courts every step of the journey.