Implementing a workplace vaccination requirement – lessons from BHP’s Mt Arthur Coal decision

Most employers had to quickly respond to the COVID-19 pandemic since its emergence in March 2020 including identifying workplace health and safety risks and the controls that were available to eliminate or minimise those risks.

The availability of COVID-19 vaccination in Australia has meant many employers have also had to quickly navigate the use of a vaccination requirement as a ‘control’ measure to respond to workplace risks. That is made more challenging where a public health order or government direction does not apply and an employer has to assess whether it can effectively impose an employment condition that employees are vaccinated against COVID-19 in order to perform their duties.

With the emergence out of various lockdowns and remote working arrangements in the latter part of 2021, employers have turned their minds to whether workplace vaccination directions are required.

Since mid-year, some large employers announced decisions to ‘mandate’ vaccination for their workforce, rationalising the requirement as part of their safety obligations to employees. Others waited to see how government would respond and whether the decision could be deferred because of the imposition of public health orders and government directions. Each state has had a different approach with different timelines.

The recent decision in Construction, Forestry, Maritime, Mining and Energy Union, Mr Matthew Howard v Mt Arthur Coal Pty Ltd T/A Mt Arthur Coal [2021] FWCFB 6059 (3 December 2021) was a much awaited decision about an employer’s ability to defend a ‘lawful and reasonable’ direction requiring employees to be vaccinated against COVID-19 in order to perform duties.

BHP’s Mt Athur Mine Operation – Site Requirement

BHP’s Mt Arthur mine, in the Hunter Valley in New South Wales, announced in October 2021 that it would require mine workers to be vaccinated as a condition of entry to site. Mt Arthur is a separate legal entity employing over 700 workers at the mine site but is within the BHP group of companies. No public health order or government direction was in place ‘mandating’ workplace vaccination at that location or workplace, and which Mt Arthur could rely on. It therefore relied on its ability to issue a ‘lawful and reasonable’ employment direction as the basis for the site requirement. This was the ‘site requirement’ that was the central focus of a recent full bench decision.

The site requirement was announced on 7 October 2021 and required that employees must have had their first COVID-19 vaccination dose by 10 November 2021 to be permitted access to the site to work, and the second dose by 31 January 2022.

The union (the CFMEU) sought to challenge the site requirement under the dispute resolution procedure in the applicable enterprise agreement. The basis for the challenge was whether the site requirement was a ‘lawful and reasonable’ direction for those employees covered by the enterprise agreement. The application of the enterprise agreement and Commission’s dealing of this matter under that agreement’s dispute resolution procedure may be an important feature to the future application of the Commission’s principles in this case.

Mt Arthur did attempt to inform employees and their union representatives, and seek feedback, about the vaccination site requirement before October. However, the process and in particular, the language used, would prove critical in the Commission’s ultimate decision to find that the site requirement was not ‘lawful and reasonable’ in the circumstances.

Consultation obligations can impact the assessment of what is a ‘reasonable’ direction

Central to the union’s argument against Mt Arthur was that Mt Arthur failed to adequately consult with employees before the 7 October 2021 ‘announcement’ about the site requirement. Those consultation obligations arose from the applicable safety legislation in New South Wales (the Work Health and Safety Act 2011 (NSW)) and the enterprise agreement.

Mt Arthur argued that the consultation obligations (and whether they had been met or not) did not impact on whether the vaccination site requirement was lawful and reasonable for the purposes of an employment direction. The full bench of the Commission disagreed finding that a range of factors will impact on whether a particular direction viewed objectively, is ‘reasonable’. The full bench stated that:

“Whether a particular direction is reasonable is not to be determined in a vacuum, it requires consideration of all the circumstances, including the nature of the particular employment, the established usages affecting the employment, the common practices that exist and the general provisions of any instrument governing the relationship. In NSW, this would include consideration of obligations in the WHS Act, which governs employment relationships in that jurisdiction. The assessment of reasonableness and proportionality is essentially one of fact and balance and needs to be assessed on a case-by-case basis. The assessment will include, but not be determined by, whether there is a logical and understandable basis for the direction.”

The full bench then closely assessed the triggers for consultation and what the processes required under those instruments. Interestingly, Mt Arthur implemented 3 ‘phases’ which it argued satisfied consultation. They were the:

  1. Options phase prior to 31 August 2021;
  2. Assessment phase from 31 August to 7 October; and
  3. Implementation phase from 7 October to 10 November 2021.

While Mt Arthur could show it informed employees of the site requirement and sought feedback about its implementation, the full bench found the safety legislation (ie. the WHS Act) required consultation before the (safety) decision was made. It found that Mt Arthur had not effectively consulted with employees before communicating on 7 October 2021 that “the Company will introduce a requirement for COVID-10 vaccination as a condition of entry…”.

Despite the process steps applied by Mt Arthur in the ‘options’ and ‘assessment’ phases, they were ultimately not enough to satisfy the full bench that effective consultation had occurred before the company made a final decision. The full bench found that the language used by the company on 7 October conveyed the decision was ‘irrevocable’ and ‘not amenable to consultation’. In a useful and detailed summary of the purpose of consultation and what it requires in practice, the full bench found that the “deficiencies” in the consultation process swayed against finding that the site requirement was a reasonable direction. That was in the context where the site requirement was not imposed by a government regulation such as a public health order.

The full bench noted that:

“[199] Mt Arthur’s failure to meaningfully consult with the Employees denied the Employees the opportunity to influence the Respondent in its decision-making process and the possibility of a different outcome. We are not persuaded that further consultation could not possibly have produced a different result.”

The full bench did observe that the enterprise agreement required consultation after a ‘decision’ and while not reaching a finding on that point, noted that Mt Arthur arguably met its enterprise agreement obligation to consult by consulting after the decision was made.

What does this mean for employers?

While being the first significant full bench decision to consider whether a COVID-19 vaccination requirement can be a ‘lawful and reasonable’ employment direction, the case very much turned on the particular facts of Mt Arthur’s decision and process steps leading to implementation of the vaccination site requirement.

The Commission did offer further observations to clarify that the site requirement may have been a ‘lawful and reasonable’ direction had the consultation obligations been met given the employer’s safety obligations and consideration of the vaccines’ effectiveness as a control to respond to those safety risks.

A caution for employers more broadly is to have regard to applicable safety legislation and relevant consultation obligations in the legislation when considering a safety based direction or policy requirement in the absence of a third party requirement such as a public health order. Consultation is key.

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