Union members at the Administrative Appeals Tribunal are seeking permission to launch industrial action in coming weeks, frustrated by nearly two years of negotiations with the federal government.
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Staff at the tribunal, often responsible for determining the validity of compensation claims from public servants, are reportedly frustrated by the disruption and uncertainty caused by a recent merger.
The Community and Public Sector Union lodged an application to run a ballot of members at the tribunal to test support for protected industrial action.
The application was lodged a day after the union sought permission to gauge support for similar industrial action in Prime Minister Malcolm Turnbull's own agency, the Department of Prime Minister and Cabinet.
On Friday, a fresh round of 200 job cuts was announced in the 2324 strong department with many public servants set to depart before Christmas.
CPSU national secretary Nadine Flood said tribunal staff were concerned their conditions were being stripped after a merger that abolished the Migration Review Tribunal, Refugee Review Tribunal and Social Security Appeals Tribunal.
"The various enterprise agreements that cover these staff expired more than 18 months ago, yet there still hasn't even been a formal offer put on the table," she said.
"Given the government's bargaining policy, our members know they're waiting for a proposed agreement that's going to leave them worse off, cutting rights and conditions with a sub-standard pay offer while giving no recognition of an 18-month wage freeze."
Ms Flood said the government had adopted a bargaining policy that made it almost impossible to resolve the dispute with tribunal staff.
"Prime Minister Turnbull and Minister Cash should accept that public sector bargaining is a mess that needs fixing and genuinely consider our proposals for a fair and realistic outcome that maintains important rights and conditions while providing a reasonable pay offer of 2.5 to three per cent," she said.