1
Fair Work Act 2009
s.604—Appeal of decision
Maritime Union of Australia, The
v
Toll Energy Logistics Pty Ltd
(C2015/5838)
SENIOR DEPUTY PRESIDENT ACTON
DEPUTY PRESIDENT GOOLEY
COMMISSIONER ROE MELBOURNE, 27 OCTOBER 2015
Appeal against decision [2015] FWCA 5210 of Commissioner Cloghan at Perth on 5 August
2015 in matter number AG2015/4055 – Group of employees fairly chosen – Agreement
genuinely agreed to by employees.
Introduction
[1] This is an appeal by the Maritime Union of Australia (the MUA) against the decision1
of Commissioner Cloghan to approve the Toll Energy Logistics Pty Ltd North West
Agreement 2015 (the Toll Energy Agreement).
[2] The Toll Energy Agreement was approved by Commissioner Cloghan on the papers
after he was satisfied that the approval requirements in ss.186, 187 and 188 of the Fair Work
Act 2009 (the FW Act) had been met. The MUA was not aware of the existence of the
Agreement prior to its approval and accordingly did not seek to make submissions before the
Commission opposing its approval.
[3] In its amended notice of appeal, the MUA contended that the group of employees
covered by the Toll Energy Agreement was not fairly chosen.2
[4] Further, the MUA contended that there were reasonable grounds upon which to
believe that the Toll Energy Agreement was not genuinely agreed to by the employees.3
[5] There were two preliminary issues that were raised on the appeal namely:
1. Did the MUA have the standing to make the appeal;
2. Should the MUA be permitted to adduce new evidence.
[2015] FWCFB 7272
DECISION
E AUSTRALIA FairWork Commission
[2015] FWCFB 7272
2
Background
[6] In August 2014 Toll Group announced it had been awarded a contract to provide
logistics support for Chevron’s operations. At the same time Toll Group announced it was
building three new vessels for the work. Though not part of the announcement the evidence
established that the contract had been awarded to Toll Energy Logistics Pty Ltd.
[7] On 15 August 2014, a service order was executed for the supply of the Sandfly. The
Sandfly is owned by Perkins Shipping Pty Ltd (trading as Toll Marine Logistics). The Sandfly
was to provide marine freight transport and logistics support for the construction phase of
Chevron Australia Pty Ltd Gorgon Project. This work involved the transport of fuel and other
construction cargo between Barrow Island and Dampier. The crew of the Sandfly were
employed by Toll Marine Logistics.
[8] In April 2015 a further service order was executed for the supply of the Firefly to be
used to perform work on the construction phase of the project, and like the Sandfly, its crew
were employed by Toll Marine Logistics.
[9] Upon the arrival of the Sandfly in Dampier, the MUA sought to initiate discussions
about an enterprise agreement.4 Toll Marine Logistics agreed to bargain for an agreement
which covered the work performed by the Sandfly in relation to the construction phase of the
project.
[10] On 16 September 2014 the MUA and Toll Marine Logistics met to discuss the
proposed agreement.
[11] On 29 September 2014 a notice of representational rights was issued to employees.
The proposed agreement was to cover employees who were engaged in the employer’s
business in Dampier, Western Australia. With the notice of representational rights was a copy
of the proposed agreement. The proposed scope was limited to the work on the Sandfly and
“the scope of work contained in the agreement between Chevron Australia Pty Ltd, Kellogg
Joint Venture Gorgon and Mermaid Supply Base Pty Ltd, which involves logistic support for
the construction phase of the project.”5
[12] In September 2014 the MUA sought to commence bargaining with Toll Marine
Logistics for an enterprise agreement to cover employees on the Sandfly, the Firefly and three
New Build Vessels, the Investigator, the Cygnet and the Astrolabe. At the time bargaining
commenced there were no employees engaged to work on the three New Build Vessels.6
[13] The MUA was a bargaining representative for this agreement.
[14] On 23 November 2014, the MUA sent an email to Toll Marine Logistics stating
amongst other matters that it was seeking an agreement covering all LCT and barge
operations undertaken by Toll Marine Logistics between Dampier and Barrow Island or
within coastal waters in Western Australia.7
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[15] Relevantly the MUA proposal included a provision that “recruitment of new
employees shall be in consultation with the relevant unions with absolute preference for half
the deckhands to be integrated ratings and the other half to have worked in the oil and gas
industry as Deckhands for a period of at least five years. Current and future STCW’s to be
provided with IR training.”8
[16] Negotiations continued with recruitment and scope relevant for this decision being
unresolved.
Recruitment and scope
[17] By email dated 12 February 2015 the MUA asked Toll Marine Logistics to give
consideration to employing named seafarers on the LCT’s. In its email the MUA stated that
“it was keen to see local employment on the LCT’s but also understand the company’s
position in regard to existing employees. The MUA is keen to work on an acceptable
compromise and looks forward to settling an enterprise agreement……”.9
[18] Ms Leanne Cull, a Human Resources Manager with Toll Transport Pty Limited, gave
evidence that at the meetings before and after this email, the MUA made it a condition of
reaching agreement that the majority of positions on the New Build Vessels had to be filled
from the MUA’s list of unemployed Western Australian branch MUA members.10
[19] On 17 February 2015 the MUA sent Toll Marine Logistics an email reiterating its
position that “the MUA are seeking a number of Western Australians offered employment on
the LCT’s, along with the existing NT crew”.11
[20] This claim was rejected by Toll Marine Logistics because its priority in the first
instance was to recruit and redeploy current employees in Western Australia, Queensland and
the Northern Territory into vacant positions on the New Build Vehicles as they became
available. It needed to do this to meet its redeployment obligations to its current employees,
as work on the Sandfly and Firefly was only temporary and Toll Marine Logistics crew
members in the Northern Territory and Gladstone businesses were not guaranteed job offers
with the new owners.
[21] On 26 or 27 February 2015 a further bargaining meeting occurred. At that meeting the
MUA told Toll Marine Logistics that the outstanding items were not negotiable.12
[22] On 3 March 2015 the MUA sent an email advising that the MUA was now seeking to
maintain its position as articulated in the correspondence of 23 November 2014.13
[23] On the same day, in response to that email, Toll Marine Logistics agreed to include the
New Build Vessels in the scope of the agreement and in relation to priority being given to
Western Australian MUA members, that are not current Toll employees, Toll Marine
Logistics advised that they gave a commitment to the recruitment of current employees of the
Toll Group into any vacancies, irrespective of the location of the employees. This it was said
would apply to current Sandfly crew and possible Firefly crew.14
[24] On 5 March 2015 Toll Marine Logistics put forward a proposed agreement to the
MUA and advised that they sought a response by 10 March 2015 failing which they would
put the proposal to the crew.15
[2015] FWCFB 7272
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[25] On 8 March 2015, Toll Marine Logistics advised all employees on the Sandfly and
Firefly of the current state of negotiations.16
[26] On 10 March 2015 the MUA responded to Toll Marine Logistics’ proposed agreement
and advised that:
“The primary position was that if we were to explore a new position or alternate
landing then we would do on the basis that there was 100% permanency of
employment for this work including any new vessels that come. As a secondary
position we said that it is our preference for inshore local work for there to be
preference for local employment – but having consideration for the fact that those
employees who are currently doing this work on the Sandfly to have the initial jobs on
the new builds and to have permanency for the life of that contract including seniority
over anyone that is employed after them. Our view is that the company should explore
local employment for subsequent jobs after the initial crews have filled the first
positions on the new builds.
We accept Toll’s in respect of what they have put to us and will work with you to
ensure you meet your internal obligations as well.
As a result of being unable to reach an outcome on the alternate landing with the most
recent discussions we wish to continue to negotiations where we left off prior to
exploring the alternative position.”
[27] This correspondence was provided to the crew of the Sandfly and Firefly.17
[28] On 22 April 2015 Ms Cull advised the MUA that “all crew in the WA project already
will transfer from the Firefly or Sandfly in their current roles onto the first two new builds
when they arrive. There are plans for a third vessel in the later quarter that is yet to be crewed.
Crew will be considered from across TML”.18
[29] No further negotiations took place until 30 June 2015 when the MUA proposed
another meeting by which time Toll Energy Logistics had lodged for approval an agreement
to cover employees on the New Build Vessels. The MUA was not advised of this until after
the Toll Energy Agreement was approved.
Negotiations for the Toll Energy Logistics Pty Ltd North West Agreement 2015
[30] The first of the New Build Vessels, the Investigator, was due to arrive in Dampier in
early August 2015. Seven employees were needed to make up the first crew. The second crew
would not be needed until September 2015 at the commencement of the next swing.19
[31] Toll Energy Logistics identified seven employees, three from the Sandfly and four
from the Firefly, as potential employees. A two-day meeting was organised with these
potential employees on 22 and 23 June 2015. The purpose of the meeting was to finalise
employment offers, conduct inductions and training, and commence negotiations for a new
enterprise agreement to cover the work.20
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[32] The proposed employees were informed that the Investigator and the other New Build
Vessels would be operated by Toll Energy Logistics. Employees were required to sign
confidentiality agreements which required them to undertake not to disclose or use any
commercially sensitive information that was provided to them at the meeting.21
[33] The proposed employees were handed employment contracts along with the Fair Work
Information Statement. It was Ms Cull’s evidence that she told the employees that there was
no pressure to accept the employment offer and that “if they did not wish to take up
employment with Toll Energy, they could remain in their current roles.”22 The seven
employees accepted the offer of employment.
[34] After lunch the employees were provided with a notice of employee representational
rights. Ms Cull told them that they had the right to have someone represent them. She said she
made it clear that they were free to choose their own representative. She denied putting any
pressure on employees to appoint themselves as their own bargaining representative.23
[35] She explained to employees that an enterprise agreement was required because:
1. it considered this to be necessary to provide Chevron and Toll Energy Logistics
with security and certainty of the marine logistics support services for the period of
the contract;
2. Toll Marine Logistics had been negotiating with the MUA and other unions to
cover the work of the Sandfly and Firefly but had been unable to reach an
agreement;
3. Toll Energy Logistics wanted an agreement to cover the operations phase work
and wanted to negotiate with and hear directly from the employees as it was
important to them;
4. Toll Energy Logistics had a draft agreement prepared but employees would have
every opportunity to go through it and put forward what they thought should not be
included.24
[36] She denied telling the employees that:
1. if they did not make the agreement that they would go back to their old vessels;
2. the MUA were demanding crew only be from Western Australia and that the MUA
was trying to replace the Toll Marine Logistics employees with Western
Australian branch members. In response to an issue raised by the employees that
the MUA was trying to give [their] jobs away, she told the employees that the
MUA have put forward a demand to name the people they wanted on the vessels
and the ratio was higher for their people than for our people. She told the
employees that it had not been agreed to as they saw their obligation was to
redeploy their own employees;
3. they had to appoint a particular bargaining representative;
[2015] FWCFB 7272
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4. they only had two choices, nominating themselves or nominating one of the other
crew;
5. the Chevron contract was at risk.25
[37] The employees were provided an opportunity to discuss the matter amongst
themselves and after that they advised Ms Cull that they wished to negotiate on their own
behalf. Each employee appointed themselves a bargaining representative.26
[38] Further negotiations for the Toll Energy Agreement continued in the afternoon and on
the next day. The employees were due to commence their first swing on 8 August 2015
though one of the crew joined the vessel on 15 July 2015 for the journey to Australia.27
[39] On 6 July 2015 a final meeting was held with six of the employees to review the Toll
Energy Agreement and the employees were provided with a final copy of the document. The
employees were also provided a notice setting out voting dates, methods and details.28 A
separate meeting was held with the seventh employee.29
[40] The Toll Energy Agreement was approved by the employees and the application to
approve the agreement was lodged and the Toll Energy Agreement was approved by the Fair
Work Commission on 5 August 2015.
[41] On 12 August 2015, Ms Cull sent an email to all Toll Marine Logistics employees
advising them that the Toll Energy Agreement had been approved. The email further advised
employees that “those employees who wish to move to the New Build Vessels will be offered
a position with Toll Energy Logistics Pty Ltd working on the Toll Investigator, Cygnet or
Astrolabe and at that point the conditions within this agreement will apply to their
employment.”30
Discussions with Toll Energy Logistics employees
[42] Mr Thomas Mayor, the Branch Secretary of the Northern Territory branch of the
MUA, rang one of the crew members on the Investigator to ask what had happened. He said
he was told by Mr Andrew Milner that they had been called to a meeting at short notice and
were told at the meeting with Ms Cull and Mr Trent Lonsdale that:
1. They either had to sign a confidentiality agreement to be part of Toll Energy on the
new vessel the Investigator or go back to the Sandfly;
2. Having signed the confidentiality agreement, that the meeting was about the new
enterprise agreement with Toll Energy;
3. The MUA was demanding crew only be from Western Australia and that the union
had been trying to replace them with W.A. branch members;
4. Having been given bargaining representative forms, that they were to nominate
themselves or one of the other crew and to do it collectively;
5. That one of the reasons it was being done with them directly was because
negotiations with the unions had failed and the contract was a risk.
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[43] Mr Mayor said he was also told by Mr Milner that the employees then met by
themselves and subsequently told Mr Lonsdale and Ms Cull that they had agreed to negotiate
themselves and put forward some claims. On the next day they met and finalised the Toll
Energy Agreement and the document was given to them before they flew home.
[44] Mr Mayor then spoke to another crew member Mr Garry Laurensz and he confirmed
Mr Milner’s account. Mr Mayor took notes of these conversations and typed them up into an
email sent to Mr Kyle McGinn, the Northwest organiser for the W.A. branch. The email was
copied to Mr Milner and Mr Laurensz. Mr McGinn asked Mr Milner and Mr Laurensz to
confirm what was contained in Mr Mayor’s email. Mr Milner’s response was as follows:
“The email Thomas had sent was misconstrued. We do not believe there was any
threat to our employment with Toll. The EBA is widely accepted by everyone on
board the Toll Investigator, and we believe no further action is required. Thank you for
your concerns.”31
[45] Ms Cull exhibited to her statement a draft letter from Mr Laurensz sent on 15 August
to her. That letter said:
“On the 22/06/15 as the new selected crew for the new build Toll Investigator we were
all invited down to Perth to discuss and have a meeting about the ship that was
arriving.
Once arriving in Perth at the meeting we asked to sign a confidentiality agreement, as
we were going to have a discussion on where we were all going into the future.
As this ship is not a vessel of Toll Marine Logistics, it will be operating under Toll
Energy. We as the crew were still under the EBA of Toll Marine Logistics.
The company Toll Energy approached us about a new EBA. They did however give us
the option to negotiate the new EBA; this was unanimous decision with all crew, the
negotiations went for two days in Perth and then a follow-up two weeks later in
Brisbane.
We as the crew for Toll Investigator are very happy with the outcome of the new EBA
and were at no stage put under any duress to sign, we also appreciate your concerns in
this matter but we believe we have a good outcome and are happy with EBA.”32
[46] Against this background, we consider the MUA’s grounds of appeal.
Was the group of employees covered by the Toll Energy Agreement fairly chosen?
[47] The MUA submitted that:
1. Toll Energy manipulated the agreement making process. It submitted that Toll
Energy Logistics always intended that a wider group of employees would be
employed under the Toll Energy Agreement and this group of employees was
readily identifiable at the time the Toll Energy Agreement was made.
2. There was no legitimate bona fides business rationale for the transfer of
employment to Toll Energy Logistics and that the only purpose in making an
agreement with Toll Energy Logistics rather than Toll Marine Logistics was to
[2015] FWCFB 7272
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deprive a wider group of the right to collectively bargain and to have the MUA as
their representative.
[48] Chapter 2, Part 2-4 of the FW Act provides for the making of enterprise agreements
between an employer and the employees who are employed at the time the agreement is made
and who will be covered by the agreement.33 Before the Commission can approve an
agreement, it must be satisfied that the group of employees covered by the agreement was
fairly chosen.34 If the agreement does not cover all the employees of the employer then the
Commission must decide whether the group of employees covered was fairly chosen, taking
into account whether the group is geographically operationally or organisationally distinct.35
[49] As was considered by the Full Court of the Federal Court in Construction, Forestry,
Mining and Energy Union v John Holland Pty Ltd and Another,36 it is accepted that the
reference to the group of employees covered by the agreement is a reference to “the whole
class of employees to whom the agreement might in the future apply, rather than the group of
employees which actually voted on whether to make the agreement.”37
[50] The MUA rely on the following passage in John Holland where Buchanan J accepted
that it was legally possible for an agreement to be made with as few as three employees but
that:
“Nevertheless, obviously questions may arise about the extent to which it is ‘fair’ for a
very small group of employees to fix the terms and conditions of a larger group of
employees who may be engaged during a period of years into the future. Whatever
position is taken, once an agreement is approved it endures for up to 4 years and no
protected industrial action is possible during the term of an agreement. Future
employees, therefore, have less (if any) opportunity to bargain.”38
[51] He went on :
“There is no requirement that employees who vote to make an agreement must have
been in employment for any length of time, and there is no requirement that they
remain in employment after the agreement is made. Presumably, the presently
employed members of such a group will act from self-interest, rather than from any
particular concern for the interests of future employees. The potential for manipulation
of the agreement making process is, accordingly, a real one. However, no suggestion
of that kind is made in the present case and the possibility may therefore be put to one
side for the purpose of the discussion. That is an important consideration because it
suggests, as the primary judge thought, that determination of whether the group of
employees was fairly chosen in the present case needed to bring to account the
business rationale for the choice, as well as deal with any possibility of unfair
exploitation.”39
[52] This passage was considered by the Full Bench in CEPU v Sustaining Works Pty
Limited40 which accepted that “deliberate manipulation of the agreement-making procedures
under the FW Act might found a conclusion that the group of employees covered by the
agreement was not fairly chosen.”41
[53] The Full Bench in that matter rejected the submissions of the CEPU and found there to
be no deliberate manipulation of the agreement making process.42
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[54] It was also considered by the Full Bench in CEPU and AMWU v Main People Pty
Ltd43 which said:
“[32] It may be accepted that in the above passage the possibility is recognised that
the enterprise bargaining process may be manipulated in such a way as to lead to the
unfair exploitation of employees to be covered by the agreement. However, it is clear
from the Appeal Decision that the first Full Bench was alive to this possibility, as
paragraphs [18]–[21] (quoted above) demonstrate. As the Full Bench observed, merely
because, at the time an agreement is negotiated and made, the employer only has a
small number of employees with whom to negotiate, and the coverage of the resultant
agreement encompasses a much wider range of employees, it does not follow that the
process has been manipulated and the ‘fairly chosen’ requirement has not been met.
This situation may simply reflect the hopes and ambitions of a small business which
desires to become a much larger business.
[33] The position might be different if, for example, the small group of employees
with whom the agreement was negotiated were not employed at the time for bona fide
business reasons but rather only for a short period for the purpose of negotiating and
making an agreement which was disadvantageous to genuine future employees. In that
circumstance, it might be concluded that the group of employees covered by the
agreement was not fairly chosen. But there was no evidence of anything like this
here.”
[55] As was held in John Holland the issue of whether the group of employees was fairly
chosen requires attention to be given to the whole scope of the future coverage of the
agreement.44
[56] The starting point therefore in assessing whether the group of employees was fairly
chosen is the scope of the agreement.
[57] In this case the scope of the Toll Energy Agreement was:
“3. APPLICATION AND SCOPE
(a) This Agreement is made and is binding on Toll Energy Logistics Pty Ltd,
its Employees whose classifications appear at Clause 37 and work on vessels that
perform Marine Work in the North West Marine Area as defined.
(b) Marine Work means work performed on vessels which are continually
operating in the North West Marine Area and shall include (but not be limited to)
the operation of personnel transfers vessels, general cargo supply vessels, landing
craft vessels and bunker vessels.
(c) North West Marine Area is defined as the belt of water within a radius
extending 200 nm from Lat 20°39’8 Longitude 116°43’E, Port of Dampier,
Australia.”
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[58] There were no submissions made that the scope of the Toll Energy Agreement was not
appropriate. There were no submissions that, assuming the scope did not extend to all the
employees of Toll Energy Logistics that the group chosen was not geographically,
operationally or organisationally distinct.
[59] The complaint of the MUA is that Toll Group used Toll Energy Logistics as the
employer rather than Toll Marine Logistics at a time when Toll Marine Logistics employed a
larger number of employees who were potentially within the scope of the Toll Energy
Agreement.
[60] The MUA submitted that there was no bona fide business rationale for the transfer of
employment to Toll Energy Logistics.
[61] That submission is not supported by the evidence. Mr Scott Woodward, the General
Manager of Toll Energy Logistics, gave evidence of why the decision was taken that Toll
Energy Logistics employ the marine crew for the Chevron contract on the New Build
Vessels.45 His evidence was that Toll Energy Logistics had a contractual obligation to have an
enterprise agreement in place prior to the commencement of the first swing.46 That evidence
was not challenged. At the time that decision was made bargaining between Toll Marine
Logistics and the MUA for an enterprise agreement had stalled.47 Mr Woodward said that he
made the decision in March 2015 that Toll Energy Logistics would be the employer of the
crew on the New Build Vessels because it had the commercial obligations to provide the
contracted services.48 It was also the owner of the vessels.49
[62] Mr Woodward accepted that one of the reasons he made the decision to use Toll
Energy Logistics as the employing entity was because he did not think that Toll Marine
Logistics would be able to make an agreement.50 Mr Woodward also gave evidence that
around the same time there was a reorganisation and Toll Marine Logistics “would effectively
be disbanded as an entity.”51
[63] Mr Woodward did not deny that one of the motivations was that it was more likely
that they would be able to make an agreement directly with employees before the Investigator
commenced service in Dampier if the employees were employed by Toll Energy Logistics.52
[64] It was suggested to Mr Woodward that he wanted to exclude the MUA from the
negotiations process. Mr Woodward denied this was his motivation.53 There is no evidence
that had any of the seven employees, some of whom were MUA members, not appointed
themselves as a bargaining representative that Toll Energy Logistics would have refused to
bargain for an agreement with the MUA.
[65] We consider it is arguable that a reason that the decision to use Toll Energy Logistics
was made was in order to exclude the MUA from the bargaining process or make it likely that
the MUA would be excluded from the process. If there was no other legitimate business
reason it would be arguable that this was a manipulation of the bargaining process. However,
it is not necessary to determine this matter because we have found that there were other
legitimate business reasons for Toll Group to decide to use Toll Energy Logistics as the
employer of the crew on the New Build Vessels. The reasons advanced by Mr Woodward
were not seriously challenged in cross examination.
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[66] The MUA did not seek to have the Full Bench lift the corporate veil. There may be
cases where the identity of the employer is relevant to the question of whether a group of
employees was fairly chosen. However in this matter we do not consider it to be a relevant
consideration.
[67] It was further submitted that Toll Energy Logistics knew that it would need to employ
additional employees to perform the work and these employees were identifiable as the
employees employed by Toll Marine Logistics on the Sandfly and the Firefly.
[68] It is not contested that up until March 2015 negotiations were occurring with the
employees of Toll Marine Logistics for an enterprise agreement which would cover the New
Build Vessels. It is also not contested that in April 2015 it was intended that the employees on
the Sandfly and Firefly would transfer to the New Build Vessels and that through their
bargaining representative, the MUA, they were bargaining for an agreement which would
cover the work. It is not contested that these employees and the MUA were never advised that
Toll Marine Logistics had stopped bargaining. Nor were they told (except for the seven crew)
that Toll Energy Logistics was going to be the employer of the crew on the New Build
Vessels. It cannot be denied that the decision to engage only seven employees denied those
employees the opportunity to bargain for an agreement which would, if they accepted
employment with Toll Energy Logistics, cover their employment.
[69] However there is no evidence to support a finding that the seven employees employed
by Toll Energy Logistics were not employed for bona fide business reasons. There was no
question that crew were needed to operate the vessel. The MUA complains that Toll Energy
Logistics did not engage the second crew when it knew that it would have to employ them
within a very short period of time. Mr Woodward gave evidence that it would not have been
commercially viable for Toll Energy Logistics to employ the second crew at the same time the
first crew were engaged as the client would not pay Toll Energy Logistics for the second crew
at that time.54 When asked why the employees could not have been offered employment to
commence at a later date Mr Woodward advised that that was not how the company
operated.55 He denied that the effect of this decision was to deny the employees the
opportunity to be engaged in bargaining for the new agreement.56 It was his evidence that at
the time the prospective employees had not been identified or selected.57
[70] We are unable to conclude that Toll Energy Logistics, by not employing the second
crew at the same time as it employed the first crew, did anything improper. There is nothing
inherently improper with an employer negotiating with a small number of employees in
circumstances where it knows that a larger group of employees will be engaged in the near
future. In this matter the contractual requirement to have an agreement in place prior to the
commencement of the first swing made the need for such an agreement a priority.
[71] We accept the submission that the pool of future employees was identifiable, namely
existing employees of Toll Marine Logistics employed on the Sandfly and Firefly.58
[72] However, the real issue is whether the failure of Toll Energy Logistics to involve the
MUA in bargaining on behalf of its members who were employed on the Sandfly and Firefly
and who were going to be offered work on the New Build Vessels means that the group of
employees was not fairly chosen.
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[73] We are unable to conclude that there is an obligation in the FW Act for the employer
to bargain with potential employees. The FW Act provides that an agreement is made with
employees who are employed at the time the agreement is made and who will be covered by
the agreement.59 The notice of employee representational rights is to be given to employees
who will be covered and who are employed at the notification time.60 Employees are entitled
to be represented in bargaining. Only employees who are employed at the time are entitled to
a vote on the agreement.61
[74] We therefore find that the group of employees was fairly chosen.
Were there reasonable grounds upon which to believe that the Toll EnergyAgreement
was not genuinely agreed to by the employees?
[75] The parties are in agreement that DP Asbury in Central Queensland Services Pty Ltd
T/A BHP Billiton Mitsubishi Alliance62 summarised the approach to determining whether
s.188(c) of the FW Act is engaged in particular circumstances. We endorse the approach of
the Deputy President but note that her summary is not intended to be an exhaustive list of the
circumstances in which s.188(c) might apply.
[76] The focus of s.188(c) is the genuineness of the employees’ agreement.
[77] As Deputy President Asbury concluded:
“What an employer is not permitted to do is to mislead and misinform employees or
coerce or intimidate them in a way which interferes with their right to bargain or to be
represented by a person of their choice, or so that they do not have the freedom to
choose to approve or not approve an enterprise agreement.”63
[78] The MUA seek to rely upon evidence given by Mr Mayor to support its contention
that employees were given misleading or intimidating information.
[79] In this case we have direct evidence from Ms Cull about what occurred at the meeting
with the employees. Mr Mayor’s evidence about what occurred is hearsay and in any event
his version of what he was told was contradicted by Mr Milner in his email to Mr McGinn64
of 18 August 2015.
[80] The MUA submitted that the following false and misleading statements were made:
1. Bargaining with the MUA had failed;
2. The MUA was demanding that the new vessels only be crewed from Western
Australia, such that the employees would be denied employment;
3. The employees must nominate themselves or each other as bargaining
representatives;
4. The contract pursuant to which the employment was created was at risk if the Toll
Energy Agreement was not made;
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5. If they did not accept employment with Toll Energy Logistics under the Toll
Energy Agreement they would not be able to continue working on the new vessels.
[81] We turn to deal with these matters.
1. Bargaining with the Appellant had failed
[82] The MUA relied upon Ms Cull’s statement that Toll Marine Logistics had been unable
to reach an agreement with the MUA. We do not consider that this statement was misleading.
The MUA had not since March 2015 made any attempt to progress negotiations. There is no
doubt that when she made the statement it was true.
2. The MUA was demanding that the new vessels only be crewed from Western
Australia, such that the employees would be denied employment
[83] The MUA rely in part on Ms Cull’s evidence about what she said to employees about
the MUA’s position on the crewing of the new vessels. Ms Cull said in response to a crew
member statement that the MUA “are trying to give our jobs away”, that the “MUA had put
forward a demand to name the people they wanted on the vessels and the ratio was higher for
their people than our people [Toll employees].”
[84] There is no doubt that the MUA had been seeking to have Western Australian MUA
members engaged on the new vessels. The statement that Ms Cull made was the MUA’s
position during the negotiations. However Ms Cull’s statement did not accurately reflect the
MUA’s position at the time she made the statement as the MUA had modified its position on
10 March 2015. Nonetheless, her statement must be seen in context. The employees had
received a copy of Toll Marine Logistics’ email of 8 March 2015 and the MUA’s circular of
10 March 2015 explaining its position. By the time the statement was made the employees
had been offered and accepted employment on the new vessel. By this time the employees
knew that if they appointed the MUA as their bargaining representative then the issues
associated with their employment prospects were no longer relevant.
[85] It is difficult to see how Ms Cull’s statement had a material effect on the bargaining
behaviour and voting intentions of the employees. The Toll Energy Agreement did not
contain provisions relating to recruitment.
[86] Further, nothing in the statement misled the employees about the content of the Toll
Energy Agreement or the effect of the Toll Energy Agreement.
[87] We do accept that misleading employees about their right to be represented in
bargaining can lead to a finding that the employees did not genuinely agree to an agreement.
However, we do not consider that Ms Cull’s statement meant that the employees were misled
about their right to appoint the MUA as their bargaining representative.
3. The employees must nominate themselves or each other as bargaining
representatives
[88] Ms Cull denied telling employees that they had to appoint themselves or another
member of the crew as a bargaining representative and we accept her direct evidence.
[2015] FWCFB 7272
14
[89] In oral submissions the MUA relied upon Ms Cull telling employees that Toll Energy
Logistics wanted to hear directly from employees. The MUA submitted that this was in effect
code for “we want you to appoint yourselves or another member of crew”65 as a bargaining
representative and telling the employees that Toll Energy Logistics did not want to negotiate
with the MUA.
[90] We do not consider it was misleading for Ms Cull to tell employees that Toll Energy
Logistics wanted to hear directly from the employees. That was the company’s preferred
position. We accept that the employees would reasonably have understood that the company
did not want to negotiate with the MUA. While we accept that there may be circumstances
where an employer through their words or actions intimidates employees such that they are
not free to appoint a bargaining representative of their choice or have their union as a default
bargaining representative, we do not consider that Ms Cull’s comments were of that character.
4. The contract pursuant to which the employment was created was at risk if the Toll
Energy Agreement was not made
[91] Ms Cull denied telling the employees that the contract was at risk. She did say that an
agreement was considered necessary to provide certainty for Chevron and Toll Energy
Logistics. Given Mr Woodward’s evidence that an enterprise agreement was required, Ms
Cull in fact understated the need for an agreement. It cannot be said that this statement was
misleading.
5. If they did not accept employment with Toll Energy Logistics under the Toll Energy
Agreement they would not be able to continue working on the new vessels.
[92] There is no doubt that Ms Cull told the employees that they did not have to accept
employment with Toll Energy Logistics and if they did not they would return to the Sandfly
and Firefly. There is also no doubt that this was said in the context where employees knew
that work on those vessels was for a limited duration and the work on the New Build Vessels
would be ongoing for five years. However, that did not make the statement misleading.
[93] We are unable to conclude that the evidence before the Commission supports a finding
that employees were given false and/or misleading information during the course of
bargaining such as to enable us to find that the Toll Energy Agreement was not genuinely
agreed to by the employees.
[94] Next we consider the MUA’s standing to appeal and permission to adduce new
evidence, before concluding.
Did the MUA have the standing to make the appeal?
[95] The MUA was not a bargaining representative for the Toll Energy Agreement.
[96] The MUA relied upon the decision of the Full Bench in CEPU and AMWU v Main
People Pty Ltd66 to support its submission that it had standing to bring the appeal. The
circumstances in that matter are similar in that the unions were not bargaining representatives.
In that case there was no evidence that the employees who voted to approve the agreement
were members of either union. In this case the evidence is that the employees were members
[2015] FWCFB 7272
15
but they had not asked the union to represent them. In this case the evidence was that other
members of the MUA would be employed in the future.
[97] The Full Bench in Main People held that:
“[7] The appellants have the right to represent employees under the terms of the
Agreement. Moreover, given the nature of the respondent’s business, and the industry
within which it operates, we are satisfied that it is likely that some members of the
appellants will be employed by the respondent in the future, in classifications covered
by the Agreement. In the circumstances of this case we consider that this gives the
appellants an interest in the decision to approve the Agreement beyond that of an
ordinary member of the public. Accordingly, we are satisfied that the appellants have
standing to appeal the decision to approve the Agreement”.
[98] We consider this reasoning and conclusion are applicable to this appeal and therefore
we find that the MUA has the standing to bring the appeal.
Should the MUA be permitted to adduce new evidence?
[99] At the hearing we determined that we should permit the parties to adduce evidence and
both parties did so.
[100] In Reihana v Mastercare Highrise Cleaning Services Pty Ltd,67 the Full Bench
endorsed the following approach to the admission of new evidence:
“The majority in J.J. Richards recognised that s.607(2) confers a discretion on a Full
Bench hearing on appeal to ‘admit further evidence’ and ‘take into account any other
information or evidence’ and that the principles governing the admission of fresh
evidence on appeal in the courts provide a useful guide to the exercise of the
discretion. In that regard, in Akins v National Australia Bank, Clarke JA said:
‘The Court is empowered to receive further evidence upon the hearing of an
appeal (s.75A(7) of the Supreme Court Act 1970) but pursuant to subs (8) of
that section may not receive further evidence after a trial on the merits ‘except
on special grounds’. Although it is not possible to formulate a test which
should be applied in every case to determine whether or not special grounds
exist there are well understood general principles upon which a determination
is made. These principles require that, in general, three conditions need be met
before fresh evidence can be admitted. These are: (1) It must be shown that the
evidence could not have been obtained without reasonable diligence for use at
the trial; (2) The evidence must be such that there must be a high degree of
probability that there would be a different verdict; (3) The evidence must be
credible.’” (Endnotes omitted)
[101] While we accept that the evidence given by the MUA could have been obtained at the
time we note that there was no notification of the intention to approve the Toll Energy
Agreement nor was there a hearing. In this matter, the MUA was not afforded an opportunity
to put this evidence forward at the hearing. Further, we formed the view that the evidence was
probative and if accepted by the Commission could have affected the decision that the
employees were not fairly chosen.
[2015] FWCFB 7272
16
Conclusion
Given there was no hearing of this matter or any opportunity for any person to put any of the
matters raised by the MUA to the Commission before the Toll Energy Agreement was
approved, we consider that it is in the public interest for the permission to appeal to be
granted. However, for the reasons set out above we dismiss the appeal and, having regard to
the totality of the material before the Commission in respect of the Toll Energy Agreement,
confirm the Commissioner’s decision to approve the Toll Energy Agreement.
SENIOR DEPUTY PRESIDENT
Appearances:
M Ritter, senior counsel with E Palmer for the Maritime Union of Australia.
R Dalton, counsel with A Millhouse, solicitor for Toll Energy Logistics Pty Ltd.
Hearing details:
2015.
Perth:
September 24.
Printed by authority of the Commonwealth Government Printer
Price code C, PR573176
Endnotes:
1 [2015] FWCA 5210.
2 Fair Work Act 2009 (Cth), ss186(3) and (3A).
3 Fair Work Act 2009 (Cth), ss186(2)(b) and 188.
4 Exhibit R1 at [8].
5 Exhibit A2 at KM2.
6 Ibid.
7 Ibid at KM3.
8 Ibid.
9 Exhibit R1 at LC2.
10 Ibid at [18]-[19].
11 Exhibit A2 at KM8.
12 Exhibit R1 at [23].
13 Ibid at LC3.
14 Ibid at LC4.
15 Ibid at LC5.
16 Exhibit A2 at KM12.
F THE FAIR WOR AU TRALL OMMISSION SE SEAN THE
[2015] FWCFB 7272
17
17 Exhibit R1 at [34].
18 Exhibit A1 at TM7.
19 Exhibit R1 at [39]-[40].
20 Exhibit R1 at [41]- [44].
21 Ibid at [46].
22 Ibid at [47].
23 Ibid at [49]-[52].
24 Ibid at [53].
25 Ibid at [54]-[57].
26 Ibid at [58]-[59].
27 Ibid at [61]-[63].
28 Ibid at [65].
29 Ibid at [67].
30 Exhibit A1 at TM1.
31 Ibid at TM2.
32 Exhibit R1 at LC11.
33 s172(2)(a).
34 Fair Work Act 2009 (Cth), s186(3).
35 Fair Work Act 2009 (Cth), s186(3A).
36 [2015] FCAFC 16.
37 Besanko J at [2], Buchanan J at [36].
38 John Holland op. cit. at [20].
39 Ibid at 33.
40 [2015] FWCFB 4422.
41 Ibid at [24].
42 Ibid at [27].
43 [2015] FWCFB 4467.
44 John Holland op. cit. at [44].
45 Exhibit R2 at [26].
46 Transcript PN 736.
47 Ibid PN 742.
48 Ibid PN 753.
49 Ibid PN 754.
50 Ibid PN 759.
51 Ibid PN 759.
52 Exhibit R2 at [26].
53 Transcript PN 761.
54 Ibid PN 768.
55 Ibid PN 770.
56 Ibid PN 774.
57 Ibid PN 780.
58 Exhibit A1 at TM7.
59 Fair Work Act 2009 (Cth), s172(2)(a).
60 Fair Work Act 2009 (Cth), s173(1).
61 NTEU v Swinburne University of Technology, [2015] FCAFC 98 at [24].
62 [2015] FWC 1554.
63 Ibid at [84].
[2015] FWCFB 7272
18
64 Exhibit A1 at TM2.
65 Transcript PN 849.
66 [2014] FWCFB 8429.
67 [2013] FWCFB 4960.
