Default grievance procedure for Queensland associations is now in force

Grievance procedure

Effective on 22 June 2022, the Associations Incorporation Act 1981 (Qld) (AI Act) was amended to add section 47A which, in summary, provides that:

• an association’s rules may include a procedure for dealing with member grievances; and
•  if the association’s rules do not include a grievance procedure that is consistent with the requirements set out in section 47A (a complying grievance procedure), the default position is that the association’s rules are deemed to include the provisions of the model rules providing for the grievance procedure (the model procedure), even if the association’s rules expressly state that the model rules do not apply to the association.

Up to 1 July 2024, the default position had not come into practical effect because there was no grievance procedure in the model rules.

Application of the grievance procedure

The section 47A grievance procedure is only for dealing with any dispute under the rules between:

• a member and another member; or
• a member and the management committee; or
• a member and the association.

It does not apply to disputes between the association and the management committee or between members of the management committee in that capacity. Further, the model procedure is only for disputes initiated by a member against another member, the management committee or the association.

If an association’s rules include a grievance procedure that is not a complying grievance procedure, then the entire procedure is invalid and the model procedure applies.

Court proceedings

The legislative intent of the grievance procedure is to equip associations with a formal process to handle and resolve internal disputes without the need to resort to, or at least, before resorting to, costly court proceedings.

Section 72 of the AI Act gives the Supreme Court of Queensland powers to make orders and declarations to enforce an association’s rules and the rights and obligations of members and the association. However, reflecting the legislative intent, the section provides that an association or a member cannot make an application to the court in relation to a dispute, including applications for interim orders, unless the association or member has made reasonable attempts to resolve the dispute using the grievance procedure in the association’s rules.

Complying grievance procedure

A complying grievance procedure must include the following:

• The procedure must include mediation and may provide for a person to decide the outcome of the dispute.
• A member may appoint any person to act on behalf of the member in the grievance procedure (member’s representative).
• In applying the grievance procedure, the association must ensure that:
  • each party to the dispute has been given an opportunity to be heard on the matter the subject of the dispute; and
  • the mediator, and any person engaged under the rules to decide the outcome of the dispute, is unbiased.
• If a member has initiated a grievance procedure for a dispute between the member and the association, the association must not take disciplinary action against the member or the member’s representative until the grievance procedure has been completed.

The model rules grievance procedure

The Associations Incorporation Regulation 1999 (Qld) has been amended with effect on 1 July 2024 to add new rules 12A to 12F to the model rules in Schedule 4. In summary, the model procedure is as follows:

• A member (the aggrieved member) initiates the procedure by providing notice to the other party and also to the management committee if the dispute is with another member or the association.
• If 2 or more members initiate a grievance procedure in relation to the same subject matter, the management committee may require the disputes to be dealt with in a single process and the aggrieved members must choose one of them to represent all of them in the grievance procedure.
• The parties, in good faith, must attempt to resolve the dispute.
• If the parties cannot resolve the dispute within 14 days, the aggrieved member may request the secretary to refer to the dispute to mediation within a further 21 days and the secretary must refer the dispute to mediation within 14 days of the request.
• The management committee is not required to attempt to resolve the dispute or refer the dispute to mediation under certain circumstances, including, if:
  • a procedure under the rules to take action against the aggrieved member or terminate the aggrieved member’s membership has already commenced and the dispute relates to that procedure;
  • the aggrieved member has recently behaved in away that gives the management committee grounds for disciplinary action under the rules and dispute relates to that behaviour;
  • the dispute could reasonably be considered frivolous, vexatious, misconceived or lacking in substance; or
  • the dispute relates to a matter that has already been subject of the grievance procedure.
• The mediator must be chosen by the parties. If the parties cannot agree:
  • if the dispute is between members, the mediator is appointed by the management committee, and there are no required mediator qualifications; or
  • if the management committee or the association is a party to the dispute, the mediator must be an accredited mediator or a mediator appointed by the director of a dispute resolution centre.‍
    • Accredited mediators are listed on the Register of Nationally Accredited Mediators.‍
    • Dispute resolution centres are established under the Dispute Resolution Procedures Act 1990 to provide mediation services.
• The appointed mediator must start the mediation as soon as possible after appointment and try to finish it within 28 days after appointment unless they are a director of a dispute resolution centre.
• The mediator:
  • must give each party to the dispute an opportunity to be heard on the subject matter of the dispute;
  • comply with natural justice;
  • must not act as an adjudicator or arbitrator; and
  • may see the parties together or separately, with or without representation during the mediation.
• A party to the dispute may appoint a representative. A representative must have sufficient knowledge of the subject matter of the dispute to be able to represent the party effectively and be authorised to negotiate an agreement on behalf of the party.
• The costs of the mediation are shared equally between the parties unless otherwise agreed.
• A meeting or mediation can occur electronically if agreed to by all parties and the mediator.

Former members

The complying grievance procedure requirements only apply to current members but a fertile ground for association disputes is whether a person’s membership has been validly terminated, so there is a threshold question as to whether the aggrieved person is still a member who has the right to initiate the grievance procedure. The model procedure provides that the grievance procedure cannot be used by a person whose membership has been terminated if the rules provide for an appeal process against the termination.

Mediation or arbitration

A mediator assists the parties to reach a negotiated resolution and may recommend outcomes but cannot decide the dispute. A dispute resolution procedure in which a person has the authority to decide the outcome of the dispute is called arbitration. An arbitrator’s decision is final and binding on the parties and the arbitrator’s decision is enforceable by a court.

The model procedure does not provide for arbitration so if mediation fails, the next formal step available to the aggrieved member is to start court proceedings.

What associations should do?

Queensland incorporated associations will need to consider whether the model procedure is suitable and sufficient for their needs or whether a customised grievance procedure should be developed.

If you would like our assistance to work out what grievance procedure is suitable for your association and to change your association’s rules to include a grievance procedure, please do not hesitate to contact us.