Affco, Meat Workers Union in Supreme Court over bargaining breakdown

Affco Horitiu near Hamilton. Photo / File

Affco and the Meat Workers Union took their battle over unlawful lockouts during negotiations to the Supreme Court today, the latest stage in the long-running dispute.

The case is the first judicial test of amendments to the Employment Relations Act introduced in March 2015, which allowed firms to opt out of multi-employer agreements and removed the duty under good faith bargaining for both sides to reach an agreement.

Affco was the first company to apply for an end to bargaining under the legislative changes and has mounted continuous but as-yet unsuccessful legal challenges to an Employment Court ruling in favour of the Meat Workers Union. Its application for judicial review of the Employment Court decision earlier this year was thrown out by the Court of Appeal, with the bench describing it as "an abuse of process" for running it in tandem with the more substantial issue, dealt with in today's Supreme Court hearing.

The case dates back to the opening of the 2015/16 killing season when Affco invited the previous season's workers to attend presentations for new individual employment contracts that differed from their old collective agreement. While that agreement had expired, the union had begun bargaining for a new collective agreement.

The Employment Court ruled that Affco unlawfully locked out meat workers when collective bargaining talks were still underway, and breached the act by not acting in good faith while negotiating a new collective agreement. That decision was significant in finding that seasonal workers were engaged by Affco on employment agreements of indefinite duration rather than ending when the season ended.

Affco unsuccessfully challenged that in the Court of Appeal, whose ruling last October had something to displease both sides. The appeal court ruled the Employment Court erred in finding seasonal workers were on employment agreements of indefinite duration, but upheld the lower court's decision that the workers were "employees" for the purposes of the lock-out.

Leave to appeal to the Supreme Court was granted on one question - whether Affco had breached a section of the act defining the meaning of "lock-out" when it required seasonal workers to enter into new individual employment agreements before commencing work for the 2015/2016 season.

Today, Affco's lawyer Pheroze Jagose doubled down on the company's argument that the workers were not employees because their contracts ended each year, so the new offers weren't a breach of contract, and Affco had no legal obligation to offer above the statutory minimum requirements.

"It is, with respect, a critical understanding of what's going on here. Employment is terminated," Jagose said. "When their employment terminates, that's the end of their agreement. What's left is the employer's obligation to offer re-employment."

Peter Cranney, lawyer for the Meat Workers Union, spoke briefly at the end of the afternoon session. He said the starting point was to emphasise the broad nature of the statutory good faith obligation on Affco. The two-day hearing continues tomorrow.