1
Fair Work Act 2009
s.604 - Appeal of decisions
Australian Municipal, Administrative, Clerical and Services Union
v
Yarra Valley Water Corporation
(C2013/5138)
VICE PRESIDENT HATCHER
SENIOR DEPUTY PRESIDENT WATSON
COMMISSIONER LEWIN SYDNEY, 30 SEPTEMBER 2013
Appeal against decision [[2013] FWCA 3816] of Commissioner Gregory at Melbourne on 4
July 2013 in matter number AG2013/1334.
Introduction
[1] This appeal, for which permission to appeal is required, challenges a decision, issued
ex tempore by Commissioner Gregory on 24 June 2013 and in written form on 4 July 20131
(Decision), in which he approved the Yarra Valley Water Enterprise Agreement 2012
(Agreement). In the hearing before the Commissioner, and in the appeal, there was no issue
that the content of the Agreement contained no impediment to its approval, and that the
Agreement satisfied the “better off overall test” contained in s.193 of the Fair Work Act 2009
(the Act). However the appellant (ASU), with the support of The Association of Professional
Engineers, Scientists and Managers, Australia (APESMA), submitted before the
Commissioner that the requirement in s.186(2)(a) that the Agreement must have been
genuinely agreed to by the employees covered by it was not satisfied. That submission is
maintained in the appeal, albeit it is advanced on a different basis (as we discuss later).
Factual Background
[2] The controversy before the Commissioner arose out of certain events which occurred
in the course of bargaining for the Agreement. Bargaining for the Agreement involving the
respondent (Yarra Valley Water), the ASU, the APESMA and other bargaining
representatives commenced in April 2012. By about November 2012, Yarra Valley Water had
produced a draft agreement which it then put to an indicative vote of the employees to be
covered by it. Notwithstanding that the ASU recommended that employees vote against the
draft agreement, it was approved by about 70% of employees who voted.
[3] It was then necessary for Yarra Valley Water, being a State-owned corporation, to
obtain the approval of the Victorian State Government for the agreement in order to be able to
1 [2013] FWCA 3816
[2013] FWCFB 7453
DECISION
E AUSTRALIA FairWork Commission
[2013] FWCFB 7453
2
progress it any further. For that purpose, it submitted the draft of the agreement to the
Department of Treasury and Finance (Department) for consideration. After some delay, the
Department communicated to Yarra Valley Water that some changes to the draft agreement
were necessary.
[4] Yarra Valley Water then sent two emails to employees concerning the changes
required by the Department (Emails). The first, dated 29 April 2013, was sent by Anne
Farquhar, General Manager - People and Culture, to the employees who had participated in
the earlier negotiations. This included the ASU and the APESMA representatives. The critical
part of the email read as follows:
“However, we were recently contacted by DTF regarding the wording of some of our
clauses in the EA. The background is that Parks Victoria attended the Fair Work
Commission (FWC) regarding their EA and after a number of appeals by the parties
involved, the highest authority at the FWC - the Full Bench - determined that a number
of clauses within the Parks Victoria Enterprise Agreement had to change in order to
comply with other common law requirements and legislation. This decision now
affects all Government entities, including us.
DTF advised that a small number of clauses within our EA do not comply with the
FWC decision and that we must therefore make changes. They advised that neither the
Government now FWC will approve the agreement without these changes being made.
We have sought independent legal advice on this matter. Written advice has now been
received that confirms DTF’s advice. Our lawyers advised that our document will not
be approved by the FWC if we don’t make these changes as we must abide by the
FWC’s rulings. The changes that need to be made will NOT impact entitlements,
salary increases or the back-dating of the pay increase to 15 November 2012.”
[5] The email went on to attach a table setting out changes to 24 provisions of the draft
agreement that the employees had voted on in November 2012 that were required by the
Department (Table). The Table was set out in three vertical columns. In the left-hand column
was contained the original provision appearing in the draft agreement. In the middle column
was the modified clause required by the Department (although in a few cases the provision
was required to be moved entirely). In the right-hand column were short comments explaining
the rationale for the modification. In all but a few cases, the rationale (expressed in slightly
different ways) was: “required to gain approval”. In relation to seven of the provisions, the
modifications concerned references to unions and their role with respect to various matters. It
was common ground that these modifications arose as a result of a Victorian State
Government policy concerning “union neutrality” in agreements.
[6] The second email was sent by Ms Farquhar to all employees on 2 May 2013. This
email said:
“It’s been a while since we’ve updated you on the status of the EA. As part of the
standard process, we have been working with the Department of Treasury and Finance
(DTF) to answer questions regarding the content and the financial calculations. DTF
has now contacted us to advise that a few changes need to be made to our EA in order
to comply with a recent fair Work Commission (FWC) decision (‘Parks Victoria
decision’). All EA’s must be approved by the FWC.
[2013] FWCFB 7453
3
What is the ‘Parks Victoria decision’?
Recently the full bench of the FWC set a precedent by ruling that a number of clauses
within the Parks Victoria Enterprise Agreement had to change in order to comply with
other common law requirements and legislation.
What does this mean for Yarra Valley Water’s EA?
To gain approval for our EA, we must make some modifications to a few clauses to
comply with the Parks Victoria decision. The modifications will not impact
entitlements, salary increases or back-dating of the pay increase to 15 November 2012.
What are the changes?
Most of the changes relate to process. Changes include:
Simplifying Clause 2.2.14 (Maximum Term Employment) to make it clearer,
Modifying the LSL clause to comply with the Water Long Service Regulations
(resulting in an increase in entitlement),
Adding a definition for the Step 1 process,
Removing clause 11.3 (Grievance regarding appointment/non-appointment),
Allowing non-union representatives access to industrial relations training in clause
4.7.23
Including the name of YVW’s default super fund (Equipsuper) in clause 2.6.
Click here for a full table of changes.
We will continue to keep you updated on the progress of the EA. In the meantime if
you have any further questions please do not hesitate to contact me.”
[7] The link referred to in the penultimate paragraph of the email took the reader to a copy
of the Table.
[8] A short explanation of the “Parks Victoria” reference in the Emails is required at this
point. Parks Victoria v Australian Workers’ Union and others2 was a decision of a Full Bench
of this Commission arising out of an arbitration conducted under s.266 of the Act for a
workplace determination following the termination of protected industrial action. Parks
Victoria was an agency of the Victorian State Government. In the course of the proceedings,
Parks Victoria contended that a number of terms that were agreed between the parties could
nonetheless not be included in the workplace determination to be made because of the
operation of the Fair Work (Commonwealth Powers) Act 2009 (Vic) (the Referral Act) and
the implied constitutional limitation on Commonwealth legislation curtailing the capacity of
the States to function as governments as explained in Re Australian Education Union; Ex
parte Victoria (Re AEU)3. The Referral Act, broadly speaking, referred to the Commonwealth
workplace relations matters such as to permit the Act to apply to employers in Victoria which
were not “national system employers” as defined in s.14 of the Act and their employees.
However s.4(1)(a) of the Referral Act excluded from the referral “matters pertaining to the
number, identity or appointment (other than terms and conditions of appointment) of
employees in the public sector who are not law enforcement officers”, so that there was no
power under the Act to deal with these matters in a workplace determination insofar as
2 [2013] FWCFB 950
3 (1995) 184 CLR 188
[2013] FWCFB 7453
4
Victorian employers which were not national system employers, and their employees, were
concerned. These exclusions from the referral were intended to encompass the same matters
identified by the High Court in Re AEU as being essential to the functioning of the States and
thus not capable of being regulated by the Commonwealth.4 In the Parks Victoria decision, it
was therefore necessary for the Full Bench to determine whether a number of agreed terms
concerning seasonal employees, fixed term employees, casual employees, appointments,
promotions and relocations were capable of being included in the workplace determination it
was required to make. It is not necessary for present purposes to identify what the specific
conclusions of the Full Bench were as to those matters.
[9] In addition to the Emails, Yarra Valley Water also communicated to its employees
about the Agreement in a number of ways, including by further emails, “roadshows”,
information packs for managers to brief employees, and information sessions. One email to all
employees dated 10 May 2013 contained the following statements:
“If the majority of EA staff vote YES in the formal vote to approve the new EA, then
the document is sent to the FWC for approval. Once the FWC approves our EA, then
all ES staff will receive back pay to the start date of the new EA: 15 November 2012.
Back pay for full-time staff will range from approximately $700 to $2000 gross.
If the majority of EA staff vote NO then there will be no backpay to the 15th
November 2012 and negotiations will recommence. Back pay would then only be paid
to the date that the new negotiations result in an informal YES vote. At that stage we
would begin the Government approval process again.”
[10] The evidence did not disclose that prior to the vote upon the Agreement taking place
on 22 May 2013 the ASU ever communicated to Yarra Valley Water or the employees that it
considered the Emails to be misleading or that it otherwise took issue with the contents of the
Emails. On 15 May 2013 the ASU distributed and placed on union notice boards a leaflet
entitled “Yarra Valley Water News” which advocated a “no” vote in relation to the
Agreement. It began with the sub-heading “YVW Slash Working Conditions of Staff” and
said “The agreement that you voted on last year looks nothing like this proposed agreement”.
It contained a long list of conditions (set out over three pages) which it contended had been
changed or removed compared to the previous Yarra Valley Water agreement. Provisions
identified as required to be modified in the Table were included in the list. The ASU leaflet
ended with the statement: “To save your hard won conditions: Vote No”. On 21 May 2013 a
modified form of the leaflet (with some added material) was distributed by ASU delegates to
all employees via the Yarra Valley Water email system. Yarra Valley Water responded to the
first version of the ASU leaflet with a document of its own entitled “EA Myth-Busters - Don’t
listen to the rumours ... get the FACTS!!!”. This leaflet stated as a “FACT”: “Since the
informal vote a number of changes had to be made to comply with Government and Fair
Work Australia rules - all the changes were detailed in the email sent to all staff on 2 May.”
The document ended with the statement: “YVW offers good wages, conditions, benefits and
work environment. VOTE Yes!”. A further leaflet issued by Yarra Valley Water on 22 May
2013 (the morning of the vote) referred to the fact that it had “already provided a complete list
... about all the changes to the EA which were necessary to comply with the Parks Victoria
decision and Government policy”.
4 See Parks Victoria v AWU at [308].
[2013] FWCFB 7453
5
[11] On 22 May 2013 the Agreement was approved in a vote of employees, with about
74% of those who voted voting in favour.
Proceedings before the Commissioner and the Decision
[12] On 19 June 2013, after Yarra Valley Water had applied to the Commission for
approval of the Agreement under the Act, the ASU sent a letter to Commissioner Gregory
(being the member allocated to deal with the application) attaching a Form F18 Declaration
made by Michelle Jackson, Acting Assistant Branch Secretary, expressing opposition to the
approval of the Agreement. The declaration set out 10 grounds for the objection to approval
of the Agreement, inter alia on the basis that the second of the Emails, the Table, the
roadshows, the “EA Mythbusters” leaflet and the statements in the 10 May 2013 email
concerning backpay were actually or potentially misleading. The grounds did not actually
state the statutory basis for the objection, but the covering letter stated:
“The ASU has concerns that YVW did not take all reasonable steps to explain the terms
of the proposed agreement, and the effect of those terms, to its employees. The ASU is
therefore not satisfied that the application meets the pre-approval requirement
contained in subsection 180(5) of the Act.
[13] The Commissioner conducted a hearing with respect to Yarra Valley Water’s approval
application on 24 June 2013. The ASU began its closing submission as follows:
“In the ASU’s submission the employer did not take all reasonable steps to ensure that
the effect and the terms of the proposed enterprise agreement were explained to those
who would be covered by the enterprise agreement”.
The ASU then expanded upon this submission at some length, and in the course of the
submission made specific references to s.180(5), including in the course of a dialogue with
the Commissioner. After completing this part of its submissions, the ASU then made the
following submission:
“The last broad area that I want to make submissions on, Commissioner, is the good
faith bargaining requirements which I submit are potentially relevant to whether an
agreement was genuinely made and I have a decision to hand up before you. It’s a
very short full bench decision and I take you to the very last line of
paragraph number 7 which in obiter which is made clear by the words:
In the circumstances it was not necessary to decide this issue but our tentative
view is the good faith bargaining requirements may be relevant in deciding
whether the case be genuine agreement [sic].
I submit that that’s consistent with the objects of Part 2-4 of the Act which included
enabling collective bargaining in good faith. Taking each element in turn, we say that
the good faith bargaining requirement at section 228(1)(b) which requires disclosing
relevant information other than confidential or commercially sensitive information in a
timely manner was not met by Yarra Valley Water.”
[14] The Commissioner, as earlier stated, determined to approve the Agreement. His
reasoning for this conclusion in the Decision was as follows:
[2013] FWCFB 7453
6
“[3] I am, firstly, satisfied that each of the requirements of ss.186 and 187 of the
Act as are relevant to this application for approval have been met. However, I am also
aware of a letter dated 19 June 2013 to the Commission from the Australian Services
Union (ASU), who are a bargaining representative for the Agreement. That letter
indicated in part:
“The ASU has concerns that YVW did not take all reasonable steps to explain
the terms of the proposed agreement, and the effect of those terms, to its
employees. The ASU is therefore not satisfied that the application meets the
pre-approval requirement contained in subsection 180(5) of the Act.”
....
[6] I am satisfied, based on the relevant authorities, that what is reasonable in the
circumstances in terms of s.180(5) and what are in any situation “reasonable steps”
depends on the circumstances of the particular matter and the various issues associated
with that workplace and the parties and employees involved. I am also satisfied based
on those authorities that “reasonable steps” do not require a full explanation of every
detail about what is contained in a proposed agreement and its intended effect in order
to satisfy the requirements of s.180(5) of the Act.
[7] In this context I refer, in particular, to the decision of a Full Bench comprising
Watson VP, Kaufman SDP and Raffaelli C handed down on 20 July 2010 in the matter
of McDonalds Australia Pty Ltd v Shop, Distributive and Allied Employees’
Association. I also note the decision was adopted by Asbury C in Glen Eden
Thoroughbreds Pty Ltd T/A Ray White Shailer Park, handed down on 16 September
2010.
[8] Based on the evidence and submissions provided in this matter and I refer, in
particular, to the additional statutory declaration and the evidence provided in the
proceedings by Ms Anne Farquhar, who is the General Manager for People and
Culture at the Yarra Valley Water Corporation, I am satisfied that the requirements of
s.180(5) of the Act have been satisfied and that accordingly the requirements of s.188
of the Act have also been met.
[9] In this context I refer, in particular, to the evidence provided about a range of
communications to employees that commenced in late April 2013 and continued
through the following month until the Agreement was put to a vote. This included
material posted on a dedicated webpage, various email communications to all relevant
employees including, inter alia, a table of changes detailing the original clause
wording and new clause wording introduced because of requirements from the
Department of Treasury and Finance, together with comments indicating why those
changes had been made. There were also what were described as “road shows”
convened by the employer and information sessions held at various locations to which
relevant employees were invited and able to attend, together with various other
publications on display screens and notice boards.
[10] I am also satisfied that this information was distributed within a time frame
that enabled any affected employee to obtain any relevant clarification, if required. I
also note that a number of the employees to be covered by the proposed agreement
were actively represented by two registered organisations as bargaining
[2013] FWCFB 7453
7
representatives, who also provided various communications to their members about
the terms of the proposed agreement and in the process highlighted issues which their
members might wish to seek further clarification about. Those organisations also, as
the evidence indicates, distributed various written materials to members and on at least
one occasion during the relevant period convened meetings so that members could
attend and obtain further information about what was being proposed.
[11] I am also satisfied that care was taken to ensure that any employees who were
absent on leave at the time, or any employees for whom English is not their first
language, were able to have appropriate arrangements put in place to respond to these
circumstances if they so desired. However, I also note that there has been no evidence
led in the proceedings about any employee in these two categories being adversely
impacted by the process of communication embarked upon, either prior to the
agreement being voted on or subsequent to.
[12] In coming to this decision it is acknowledged that some of the information
distributed by the employer was provided in a way intended to encourage employees
to support and vote in favour of the proposed agreement. However, I am also satisfied
that the information and explanations provided by the employer were also constituted
in a way that satisfies the requirements and obligations imposed upon the employer by
s.180(5) of the Act.”
Appeal submissions
[15] The ASU’s amended notice of appeal contained five grounds of appeal. Those
grounds, and the submissions made in support of them, may be summarised as follows:
(1) The Commissioner erred in failing to expose his path of reasoning as to his
findings: The Commissioner failed to identify the material steps which led him
to conclude that s.188(c), and therefore s.186(2)(a), had been satisfied as
required by the principles stated in Barach v University of New South Wales.5
(2) The Commissioner failed to take into account material considerations: The
Commissioner failed to take into account that the Emails and the Table were
misleading and sought to use the imprimatur of the Commission to further
Yarra Valley Water’s objective of obtaining employee approval for the
Agreement. Genuine approval by employees under the Act requires informed
consent without coercion: Re Grocon Pty Ltd Enterprise Agreement
(Victoria)6; Coles Supermarkets Australia Pty Ltd v SDAEA7. Where the
agreement of employees is obtained in a misleading manner, it does not
amount to genuine approval: Manfield Colair and CEPU Electrical Division
Northern Territory Enterprise Agreement Gove Alumina Refinery and Mine
Site - 2010/20118, affirmed on appeal in CJ Manfield Pty Ltd v CEPU.9 The
Emails and the Table were misleading in that it mischaracterised the
5 [2010] FWAFB 3307
6 PR927672
7 T2319
8 [2011] FWAA 9129
9 [2012] FWAFB 3534
[2013] FWCFB 7453
8
significance of the alterations, incorrectly indicated that the alterations
involving limitations on union involvement were necessary by virtue of the
Parks Victoria decision10, and also incorrectly indicated that all the alterations
were necessary in order for the Agreement to be capable of approval by the
Commission.
(3) The Commissioner failed to apply the law to the facts: The Commissioner only
considered the Communication in the context of s.180(5), and failed to
consider it under s.188(c). If he had done so, he would have had to conclude
that there were reasonable grounds for believing that the Agreement had not
been genuinely agreed to by the employees and therefore could not be
approved.
(4) The Commissioner failed to correctly apply the law: The Commissioner failed
to apply s.188(c) to his assessment of whether the test in s.188 had been met.
Had he done so, he would have reached the same conclusion as in (4) above.
(5) The Commissioner erred as he did not have jurisdiction to approve the
Agreement: On the basis of grounds 2, 3 and 4, the Commissioner did not have
jurisdiction to approve the Agreement.
[16] The ASU disavowed any challenge to the Commissioner’s conclusions concerning
compliance with s.180(5). We also note that the ASU’s appeal did not involve any re-
agitation of its argument before the Commissioner that the good faith bargaining requirement
in s.228 had not been met.
[17] Yarra Valley Water submitted that:
(1) The Emails and the Table were not misleading, and in particular the references
in the Table to changes being “required to gain approval” could be read as
referring to the need for State Government approval, not Commission approval.
However, it conceded in oral submissions that an available reading of the
Emails was that all the changes identified in the Table were required to be
made because of the Parks Victoria decision as distinct from government
policy, and that the Emails could have been better expressed.
(2) The “genuine agreement” requirement in s.188(c) was to be considered as at
the date the Agreement was made, which was the date of the voting process (22
May 2013). The ASU leaflets, and the further information provided by Yarra
Valley Water after the Emails and before the vote were sufficient to cure any
misleading effect of the Emails.
(3) In the Decision, the Commissioner took into account all matters relevant to
s.188(c) and gave adequate reasons for his conclusions.
10 [2013] FWCFB 950
[2013] FWCFB 7453
9
Relevant statutory provisions
[18] Section 186 sets out the basic requirements applicable to the approval of enterprise
agreements. Subsections (1) and (2) provide:
“Basic rule
(1) If an application for the approval of an enterprise agreement is made under
section 185, the FWC must approve the agreement under this section if the
requirements set out in this section and section 187 are met.
Requirements relating to the safety net etc.
(2) The FWC must be satisfied that:
(a) if the agreement is not a greenfields agreement--the agreement has been
genuinely agreed to by the employees covered by the agreement; and
(b) if the agreement is a multi-enterprise agreement:
(i) the agreement has been genuinely agreed to by each employer
covered by the agreement; and
(ii) no person coerced, or threatened to coerce, any of the
employers to make the agreement; and
(c) the terms of the agreement do not contravene section 55 (which deals
with the interaction between the National Employment Standards and
enterprise agreements etc.); and
(d) the agreement passes the better off overall test.”
[19] “Note 1” to subsection 2 states: “For when an enterprise agreement has been genuinely
agreed to by employees, see section 188.” Section 188 provides:
“An enterprise agreement has been genuinely agreed to by the employees covered by
the agreement if the FWC is satisfied that:
(a) the employer, or each of the employers, covered by the agreement complied
with the following provisions in relation to the agreement:
(i) subsections 180(2), (3) and (5) (which deal with pre-approval steps);
(ii) subsection 181(2) (which requires that employees not be requested to
approve an enterprise agreement until 21 days after the last notice of
employee representational rights is given); and
(b) the agreement was made in accordance with whichever of subsection 182(1) or
(2) applies (those subsections deal with the making of different kinds of
enterprise agreements by employee vote); and
(c) there are no other reasonable grounds for believing that the agreement has not
been genuinely agreed to by the employees.”
[20] For completeness, s.180(5) (which is referred to in s.188(a)(i)) provides:
“(5) The employer must take all reasonable steps to ensure that:
(a) the terms of the agreement, and the effect of those terms, are explained
to the relevant employees; and
(b) the explanation is provided in an appropriate manner taking into
account the particular circumstances and needs of the relevant
employees.”
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employer
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#genuinely_agreed
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#enterprise_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#applies
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s182.html
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#made
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#enterprise_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#enterprise_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s181.html
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s180.html
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employer
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employer
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#genuinely_agreed
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#genuinely_agreed
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#enterprise_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s188.html
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#genuinely_agreed
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#genuinely_agreed
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#enterprise_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#passes_the_better_off_overall_test
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#passes_the_better_off_overall_test
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#enterprise_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#national_employment_standards
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s55.html
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employer
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employer
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#genuinely_agreed
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#multi-enterprise_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#multi-enterprise_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#employee
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#genuinely_agreed
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#greenfields_agreement
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s187.html
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s185.html
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#made
http://www.austlii.edu.au/au/legis/cth/consol_act/fwa2009114/s12.html#enterprise_agreement
[2013] FWCFB 7453
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Consideration
[21] The first comment which must be made about the ASU’s case on appeal is that it is a
substantially different case to that which it put before the Commissioner. As earlier explained,
the ASU’s primary submission before the Commissioner was that the requirement in s.180(5)
had not been complied with. It also put, somewhat tentatively and sketchily, a subsidiary
argument that the good faith bargaining requirements in s.228 had not been met, and that this
was “potentially relevant to whether an agreement was genuinely made”. We cannot identify
in the record of the proceedings before the Commissioner that the ASU ever made any
specific reference to s.188(c), and we do not consider that the ASU squarely put the case
which it has put in this appeal to the Commissioner.
[22] In his Decision at paragraph [3] the Commissioner made a global finding that the
requirements of ss.186 and 187 had been satisfied, subject to what he had to say about the
ASU’s s.180(5) argument. The s.186 finding necessarily encompassed a finding that the
“genuinely agreed” requirement in s.186(2)(a), which called up the requirements of s.188
including s.188(c), had been satisfied. In circumstances where the scope of the adversarial
discourse before him was confined to a primary s.180(5) argument and a subsidiary “good
faith bargaining” argument, we consider that the Commissioner was entitled to express his
satisfaction about the other statutory requirements that were not in contest in the global way
that he did. Just as the Commissioner did not make a specifically-expressed finding about the
better off overall test (BOOT) requirement in s.186(2)(d), as articulated by s.193, in
circumstances where all the parties before him submitted that there was no doubt that the
BOOT was satisfied, nor was he required to make a specific statement concerning s.188(c)
given that he was not faced with any proper submission putting that provision clearly in issue.
To be clear, we are not suggesting that a member of the Commission considering approval of
an enterprise agreement is not required to satisfy him or herself that all the requirements of
ss.186 and 187 have been met. Rather, the point is that a member of the Commission does not
fall into error merely because the member’s satisfaction as to those requirements is expressed
in a global way having regard to the issues which were actually in contest before him or her.
[23] For that reason, we reject grounds 1-4 of the ASU’s appeal. The criticisms that the
Commissioner failed to give reasons for his satisfaction as to s.188(c), or failed to take into
account considerations material to s.188(c), or failed to properly consider s.188(c) or apply it
to the facts before him, all fall away once it is concluded that the s.188(c) requirement was
never clearly or specifically put into contest before him.
[24] Ordinarily that conclusion would lead to permission to appeal being refused. The usual
principle is that a party should not be permitted to argue a case on appeal which it did not
raise at first instance. This principle, and the policy rationale which supports it, was explained
in Coulton v Holcombe11 the following way:
“To say that an appeal is by way of rehearing does not mean that the issues and the
evidence to be considered are at large. It is fundamental to the due administration of
justice that the substantial issues between the parties are ordinarily settled at the trial. If
it were not so the main arena for the settlement of disputes would move from the court
of first instance to the appellate court, tending to reduce the proceedings in the former
court to little more than a preliminary skirmish.”
11 (1986) 162 CLR 1 at 7
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[25] However the position is different if the new issue being raised is jurisdictional in
nature.12 The Commission has an overriding duty to ensure that it acts within the scope of the
powers conferred upon it by its governing statute. Ground 5 of the ASU’s appeal contends
that the Commissioner had no jurisdiction to approve the Agreement because, on the
evidence, there were for the purpose of s.188(c) reasonable grounds for believing that the
Agreement had not been genuinely agreed to by the employees covered by it. We consider
that it is necessary for us to consider this jurisdictional argument even though we have
concluded it was not properly raised before the Commissioner.
[26] As earlier outlined, the ASU’s case on appeal emphasised the misleading nature of the
Emails and the Table. We accept the submissions of the ASU in this respect. The import of
the Emails is that all the changes identified in the Table were necessary in order for the
Agreement to be capable of approval by this Commission, having regard to the jurisdictional
issues considered in the Parks Victoria decision. The references in the Table to changes being
“required to gain approval”, when read with the contents of the Emails, would reasonably be
understood by the layperson to mean “required to gain approval by the Commission”. In fact,
a number of the changes had nothing to do with any arguable interpretation of the Parks
Victoria decision, but were changes made in order to comply with Victorian State
Government policy, including in particular its policy on “union neutrality”. That was,
inexplicably, simply not mentioned in either the Emails or the Table.
[27] We regard this as a serious matter. To falsely represent that a provision of a proposed
enterprise agreement is incapable of approval by the Commission, or must be altered in a
certain way to make it capable of approval, necessarily involves the misleading propositions
that the subject matter of the provision is removed from any further negotiation and that
acceptance of the provision proposed by the employer is non-optional if any valid enterprise
agreement is to be made at all. It also has the effect of improperly putting the imprimatur of
this Commission on employer proposals which merely represent the employer’s preferred
view as to the relevant subject matter.
[28] A false representation or a material non-disclosure by an employer in the course of
bargaining for an enterprise agreement may constitute a reasonable ground for believing
under s.188(c) of the Act that an enterprise agreement has not genuinely been agreed to by
employees if it could reasonably be expected to have had the effect of deceiving those
employees into voting for something which, if they had known the true position, they would
not have voted for.13 The question in this appeal is whether the misleading representations in
the Emails and the Table could reasonably be expected to have had this effect.
[29] We consider, for two reasons, that they could not. The first reason is that, in the
context of the Agreement as a whole, those provisions which were listed as modified in the
Table and which did not relate to an arguable view about the application of the Parks Victoria
decision (including the associated issue of Re AEU) were relatively trivial in nature. In its oral
submissions, the ASU took us through each provision listed in the Table, and once those
provisions which arguably related to the Parks Victoria decision were put to one side (noting
12 See Goumas v Wattyl Australia Pty Ltd (2005) 145 IR 256 at [43]-[48]
13 Grocon Pty Ltd Enterprise Agreement (Victoria) PR927672 at [45]-[47], [52]-[53]; Manfield Colair and CEPU Electrical
Division Northern Territory Enterprise Agreement Gove Alumina Refinery and Mine Site - 2010/2012 [2011] FWAA 9129 at
[24].
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that the ASU did not concede that any provision was actually affected by that decision), was
unable to identify any modified provision which compared to the equivalent provision found
in the original draft of the Agreement detrimentally affected employee entitlements to any
appreciable degree. In particular, the changes which resulted from the application of the State
Government’s “union neutrality” policy did not involve any substantive change to the rights
or role of unions in the workplace. Therefore, even if the workforce at Yarra Valley Water
was highly unionised and sensitive to any changes to the role of unions - a matter in relation
to which there was no evidence whatsoever - it is highly unlikely that these changes would
have played any significant role in the decision of employees as to whether to vote to approve
the Agreement. They were trivial compared to the major issues such as increases in rates of
pay and the financial benefit to be obtained from backpay upon approval of the Agreement.
[30] Secondly, because the issue of genuine agreement under s.188(c) is to be assessed by
reference to relevant circumstances existing as at the date the employees voted for and
thereby made the Agreement14 - that is, as at 22 May 2013 - it is necessary to take into
account information supplied to Yarra Valley Water’s employees after the Emails and the
Table in determining whether they were misled in a way which affected their voting
decisions. We consider that the robustly-expressed ASU leaflets, which strongly urged
rejection of the Agreement on the ground that it reduced entitlements, and mentioned in that
connection some of the changes contained in the Table, was sufficient to alert employees to
the need to carefully consider all the provisions of the Agreement, including those that had
been changed since the original November 2012 draft, in making their decision as to whether
to vote to approve the Agreement. We would also infer from the lack of any challenge in
those leaflets to the purported Parks Victoria rationale for the changes that the ASU did not
consider that this would play any role of significance in employees’ decision-making. Further,
we note that by 21/22 May 2013 Yarra Valley Water had (at last) told employees that
“Government ... rules” and “Government policy” were part of the rationale for the changes
identified in the Table. The fact that, in the face of this information, the vote of employees on
22 May 2013 was more or less the same as the indicative vote in November 2012 strongly
suggests that the changes that were made to the Agreement were taken into account by
employees and not considered to be a vote-changing issue.
[31] We note, for completeness, that the ASU briefly raised in its submissions the
possibility that Yarra Valley Water was a trading corporation and therefore a “national system
employer” as defined in s.14 of the Act, with the potential consequences that the Referral Act
exclusions had no application to it and the Parks Victoria decision could not be of any
possible relevance. However the ASU did not elaborate on this submission and did not
contend that the Emails were misleading for this reason, nor was there any evidence before us
as to Yarra Valley Water’s activities such as to permit any consideration as to whether it was
a trading corporation.
[32] We do not consider that there were, for the purposes of s.188(c) of the Act, any
reasonable grounds for believing that the Agreement was not genuinely agreed to by the
employees covered by it. Ground 5 of the ASU’s appeal is therefore rejected. The
Commissioner had jurisdiction to approve the Agreement.
14 CJ Manfield Pty Ltd v CEPU [2012] FWAFB 3534 at [36]
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Conclusion
[33] Because of the misleading nature of the Emails and the Table, we are satisfied that this
appeal has raised issues that are sufficiently serious such as to attract the public interest and
require the grant of permission to appeal. For the reasons discussed above, we dismiss the
appeal.
VICE PRESIDENT
Appearances:
E. Burgio solicitor for the Australian Services Union
P. O’Grady of counsel for Yarra Valley Water Corporation
Hearing details:
2013.
Melbourne:
18 September.
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