1
Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement
MGI Piling (NSW) Pty Ltd and others
(AG2015/1040; AG2015/1055; AG2015/1139; AG2015/1224 & AG2015/1248)
Building, metal and civil construction industries
COMMISSIONER RIORDAN SYDNEY, 23 NOVEMBER 2015
Application for approval of the Enterprise Agreements.
Right to be heard/Good Faith Bargaining.
[1] This decision relates to applications by;
MGI Piling (NSW) Pty Ltd;
Bauer Foundations Australia Pty Ltd;
AVO Piling Management (MSW) Pty Ltd;
Wagstaff Piling Pty Ltd; and
Piling Contractors Pty Ltd T/A Piling Contractors Pty Ltd,
seeking Fair Work Commission (FWC) approval of their respective Enterprise
Agreements.
[2] The Construction, Forestry, Mining and Energy Union (CFMEU) have opposed all of
the applications and have sought to be heard in relation to their opposition.
[3] The CFMEU and the Piling and Foundation Specialists Federation, NSW Chapter
(PSFS) met on numerous occasions in 2014 in an attempt to negotiate a “pattern” agreement
for the piling industry in NSW. These negotiations were concluded in February 2015 when
agreement could not be reached between the parties. The CFMEU would not move away from
their industry “pattern” agreements. The piling contractors refused to accept the CFMEU
Agreement on the basis that it allegedly breaches the Building and Construction Industry (Fair
and Lawful Building Sites) Code 2014 (the Code), which is a piece of legislation that is yet to
pass the Australian Senate but has a retrospective application if it ever becomes law.
[4] The Companies were represented by Mr Bruce Hodgkinson of Counsel and Mr Iain
Jarman from the MBA. The CFMEU were represented by Mr Jim Pearce of Counsel and Mr
Paul Quinn from the CFMEU.
[2015] FWC 7345 [Note: An appeal pursuant to s.604 (C2015/7880) was
lodged against this decision and Full Bench decision dated 4 May 2016
[[2016] FWCFB 2654] for result of appeal.]
DECISION
E AUSTRALIA FairWork Commission
http://www.fwc.gov.au/decisionssigned/html/2016FWCFB2654.htm
[2015] FWC 7345
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[5] It was agreed during the hearing that it was appropriate to split the applications into
two groups, namely;
Part A. MGI Piling (NSW) Pty Ltd, Bauer Foundations Australia Pty Ltd,
AVO Piling Management (MSW) Pty Ltd and Piling Contractors Pty Ltd T/A
Piling Contractors Pty Ltd; and
Part B. Wagstaff Piling Pty Ltd
[6] It is relevant to maintain this separation in this decision.
Statutory Provisions
[7] The relevant provisions of the Fair Work Act, 2009 (the Act) pertaining to these
applications are contained in Part 2.4 – Enterprise Agreements. The following sections are of
significance;
“171 Objects of this Part
The objects of this Part are:
(a) to provide a simple, flexible and fair framework that enables collective
bargaining in good faith, particularly at the enterprise level, for enterprise
agreements that deliver productivity benefits;
173 Notice of employee representational rights
Employer to notify each employee of representational rights
(1) An employer that will be covered by a proposed enterprise agreement that is
not a greenfields agreement must take all reasonable steps to give notice of the right to
be represented by a bargaining representative to each employee who:
(a) will be covered by the agreement; and
(b) is employed at the notification time for the agreement.
Note: For the content of the notice, see section 174.
Notification time
(2) The notification time for a proposed enterprise agreement is the time when:
(a) the employer agrees to bargain, or initiates bargaining, for the
agreement; or
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(b) a majority support determination in relation to the agreement comes
into operation;
or
(c) a scope order in relation to the agreement comes into operation; or
(d) a low-paid authorisation in relation to the agreement that specifies the
employer comes into operation.
Note: The employer cannot request employees to approve the agreement under
section 181 until 21 days after the last notice is given (see subsection 181(2)).
When notice must be given
(3) The employer must give the notice as soon as practicable, and not later than 14
days, after the notification time for the agreement.
176 Bargaining representatives for proposed enterprise agreements that are not
greenfields agreements
Bargaining representatives
(1) The following paragraphs set out the persons who are bargaining
representatives for a proposed enterprise agreement that is not a greenfields
agreement:
(a) an employer that will be covered by the agreement is a bargaining
representative for the agreement;
(b) an employee organisation is a bargaining representative of an
employee who will be covered by the agreement if:
(i) the employee is a member of the organisation; and
(ii) in the case where the agreement is a multi-enterprise agreement
in relation to which a low-paid authorisation is in operation—the
organisation applied for the authorisation;
unless the employee has appointed another person under
paragraph (c) as his or her bargaining representative for the
agreement, or has revoked the status of the organisation as his or
her bargaining representative for the agreement under subsection
178A(2); or
[2015] FWC 7345
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(c) a person is a bargaining representative of an employee who will be
covered by the agreement if the employee appoints, in writing, the person
as his or her bargaining representative for the agreement;
(my emphasis)
(d) a person is a bargaining representative of an employer that will be
covered by the agreement if the employer appoints, in writing, the person as his
or her bargaining representative for the agreement.
Bargaining representatives for a proposed multi-enterprise agreement if a low-paid
authorisation is in operation
(2) Despite subsections (1) and (2):
(a) an employee organisation; or
(b) an official of an employee organisation (whether acting in that capacity
or otherwise);
cannot be a bargaining representative of an employee unless the organisation is
entitled to represent the industrial interests of the employee in relation to work
that will be performed under the agreement.
Employee may appoint himself or herself
(3) To avoid doubt and despite subsection (3), an employee who will be
covered ent may appoint, under paragraph (1)(c), himself or herself as his or her
bargaining representative for the agreement.
178 Appointment of bargaining representatives—other matters
When appointment of a bargaining representative comes into force
(1) An appointment of a bargaining representative comes into force on the day
specified in the instrument of appointment.
Copies of instruments of appointment must be given
(2) A copy of an instrument of appointment of a bargaining representative for a
proposed enterprise agreement must:
(a) for an appointment made by an employee who will be covered by the
agreement—be given to the employee’s employer; and
(b) for an appointment made by an employer that will be covered by a
proposed enterprise agreement that is not a greenfields agreement—be given,
[2015] FWC 7345
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on request, to a bargaining representative of an employee who will be covered
by the agreement.
Regulations may prescribe matters relating to qualifications and appointment
(3) The regulations may prescribe matters relating to the qualifications or appointment
of bargaining representatives.
180 Employees must be given a copy of a proposed enterprise agreement etc.
Pre-approval requirements
(1) Before an employer requests under subsection 181(1) that employees approve
a proposed enterprise agreement by voting for the agreement, the employer must
comply with the requirements set out in this section.
Employees must be given copy of the agreement etc.
(2) The employer must take all reasonable steps to ensure that:
(a) during the access period for the agreement, the employees (the
relevant employees) employed at the time who will be covered by the
agreement are given a copy of the following materials:
(i) the written text of the agreement;
(ii) any other material incorporated by reference in the
agreement; or
(b) the relevant employees have access, throughout the access period for
the agreement, to a copy of those materials.
(3) The employer must take all reasonable steps to notify the relevant employees
of the following by the start of the access period for the agreement:
(a) the time and place at which the vote will occur;
(b) the voting method that will be used.
(4) The access period for a proposed enterprise agreement is the 7-day period
ending immediately before the start of the voting process referred to in subsection
181(1).
Terms of the agreement must be explained to employees etc.
[2015] FWC 7345
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(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.
(6) Without limiting paragraph (5)(b), the following are examples of the kinds of
employees whose circumstances and needs are to be taken into account for the
purposes of complying with that paragraph:
(a) employees from culturally and linguistically diverse backgrounds;
(b) young employees;
(c) employees who did not have a bargaining representative for the
agreement.
181 Employers may request employees to approve a proposed enterprise
agreement
(1) An employer that will be covered by a proposed enterprise agreement may
request the employees employed at the time who will be covered by the agreement to
approve the agreement by voting for it.
(2) The request must not be made until at least 21 days after the day on which the
last notice under subsection 173(1) (which deals with giving notice of employee
representational rights) in relation to the agreement is given.
(3) Without limiting subsection (1), the employer may request that the employees
vote by ballot or by an electronic method.
182 When an enterprise agreement is made
Single-enterprise agreement that is not a greenfields agreement
(1) If the employees of the employer, or each employer, that will be covered by a
proposed single-enterprise agreement that is not a greenfields agreement have been
asked to approve the agreement under subsection 181(1), the agreement is made when
a majority of those employees who cast a valid vote approve the agreement.
Multi-enterprise agreement that is not a greenfields agreement
(2) If:
(a) a proposed enterprise agreement is a multi-enterprise agreement; and
[2015] FWC 7345
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(b) the employees of each of the employers that will be covered by the
agreement have been asked to approve the agreement under subsection 181(1);
and
(c) those employees have voted on whether or not to approve the
agreement; and
(d) a majority of the employees of at least one of those employers who cast
a valid vote have approved the agreement;
the agreement is made immediately after the end of the voting process referred
to in subsection 181(1).
Greenfields agreement
(3) A greenfields agreement is made when it has been signed by each employer
and each relevant employee organisation that the agreement is expressed to cover
(which need not be all of the relevant employee organisations for the agreement).
183 Entitlement of an employee organisation to have an enterprise agreement
cover it
(1) After an enterprise agreement that is not a greenfields agreement is made, an
employee organisation that was a bargaining representative for the proposed enterprise
agreement concerned may give the FWC a written notice stating that the organisation
wants the enterprise agreement to cover it.
(2) The notice must be given to the FWC, and a copy given to each employer
covered by the enterprise agreement, before the FWC approves the agreement.
Note: The FWC must note in its decision to approve the enterprise agreement that the
agreement covers the employee organisation (see subsection 201(2)).
188 When employees have genuinely agreed to an enterprise agreement
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);
[2015] FWC 7345
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(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.
228 Bargaining representatives must meet the good faith bargaining
requirements
(1) The following are the good faith bargaining requirements that a bargaining
representative for a proposed enterprise agreement must meet:
(a) attending, and participating in, meetings at reasonable times;
(b) disclosing relevant information (other than confidential or
commercially sensitive information) in a timely manner;
(c) responding to proposals made by other bargaining representatives
for the agreement in a timely manner;
(d) giving genuine consideration to the proposals of other bargaining
representatives for the agreement, and giving reasons for the bargaining
representative’s responses to those proposals;
(e) refraining from capricious or unfair conduct that undermines
freedom of association or collective bargaining;
(f) recognising and bargaining with the other bargaining
representatives for the agreement.
(2) The good faith bargaining requirements do not require:
(a) a bargaining representative to make concessions during bargaining for
the agreement;
or
(b) a bargaining representative to reach agreement on the terms that are to
be included in the agreement.”
(my emphasis)
[2015] FWC 7345
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[8] In determining this matter, I have taken into account all of the submissions and
evidence that has been submitted by the parties.
[2015] FWC 7345
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Part A. MGI Piling (NSW) Pty Ltd, Bauer Foundations Australia Pty Ltd, AVO
Piling Management (MSW) Pty Ltd and Piling Contractors Pty Ltd T/A Piling
Contractors Pty Ltd
[9] Mr Hodgkinson raised a jurisdictional question in relation to the CFMEU’s right to be
heard in these proceedings on the basis that they were not appointed as a bargaining
representative by any employee of the four companies. Relevantly, the Union did not qualify
as a default bargaining representative either.
[10] Mr Pearce argued that the CFMEU had a right to be heard because:
“a) The CFMEU has constitutional coverage of the work proposed to be performed
under the Enterprise Agreements;
b) The CFMEU has a long history of industrial representation of the work proposed to
be performed under the Enterprise Agreements;
c) The CFMEU is a party to the relevant modern award, the Building and Construction
General On-site Award 2010;
d) The CFMEU has members in all companies except Bauer (where only two
employees are to be covered by the Enterprise Agreement);
e) In the future, given the nature of the companies’ businesses, it is likely that other
members of the CFMEU will be employed in classifications covered by the Enterprise
Agreements;
f) the CFMEU is a party to the existing Enterprise Agreements covering the
employees of the companies, which have not been terminated.
g) By operation of s 58 of the Act, the effect of making the proposed Enterprise
Agreements, will be to remove employees of the companies from coverage by these
CFMEU industrial instrument and replace them with coverage by a non CFMEU
industrial instrument;
h) it may be accepted that the removal of the employees from coverage by a CFMEU
instruments will adversely affect the ability of the CFMEU to represent and recruit
members from amongst employees of the companies;
i) The CFMEU has Enterprise Agreements with other piling companies in New
South Wales and it clearly continues to be interested in the terms and conditions of
employment regulating the work performed under the proposed Enterprise
Agreements;
j) The CFMEU has Enterprise Agreements with other piling companies in other States
and it clearly continues to be interested in the terms and conditions of employment of
regulating the work performed under the proposed Enterprise Agreements.
[2015] FWC 7345
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k) it may be accepted that the removal of the employees from coverage by a CFMEU
instrument will adversely affect the ability of the CFMEU to represent and recruit
members from amongst employees of other piling companies in NSW and interstate;
l) The CFMEU will have the right to appeal any decision given in the present
proceedings under s 604 of the Act;
m) The CFMEU was actively involved in negotiating the proposed EAs with the
companies until February 2015. The negotiations collapsed because the code
compliance document proposed by the PFSF is the document to be used for
negotiations and implementation. The Code referred to is the draft Building and
Construction Industry (Fair and Lawful Building Sites) Code 2014 (the Code);
n) The very questions of the Code provisions is one of the objections to the proposed
agreements by the CFMEU. The CFMEU argue that the agreements create uncertainty
given the need to comply with the Code. Clause 6 of all proposed agreement restricts
the operation of the FW Act by requirement that any variations shall be compliant with
the Code. This clause renders the proposed agreements uncertain.”1
[11] Both parties referred me to the decision of the Full Bench of the Fair Work
Commission (FWC) in, Construction, Forestry, Mining and Energy Union v Collinsville Coal
Operations Pty Limited2 (Collinsville).
[12] Mr Hodgkinson argued that the CFMEU had run all of these same arguments before
the Full Bench in Collinsville. I have extracted numerous but relevant extracts from the above
mentioned decision below:
“Right to be heard and standing
[15] The gravamen of the CFMEU’s complaint on appeal is that it was a bargaining
representative for the Agreement and therefore had standing to be heard in the
application for the approval of the Agreement.3 It says it was denied the opportunity to
fully participate in the proceedings. The CFMEU also says that irrespective of its
status as a bargaining representative it should have been permitted to fully participate
in the proceedings before the Senior Deputy President, whether pursuant to s.590 or
otherwise, by reason, inter-alia, of its long established history of industrial
representation in the coal mining industry and at the Collinsville coal mine, its interest
in the protection of wages and conditions of employees engaged in the industry and its
interest in ensuring that the scheme under the Coal Mining Safety and Health Act 1999
(Qld) and the Coal Mining Safety and Health Regulation 2001 (Qld) is correctly
interpreted and applied in Queensland. By being denied the opportunity to fully
participate in the proceedings, the CFMEU submits that it had been denied procedural
fairness. It goes further and submits that the Senior Deputy President did not permit
the CFMEU to develop the arguments it wished to develop to establish that it had a
right to be heard and that the Senior Deputy President had been coloured in her view
about the CFMEU’s standing by reference to its status as a bargaining representative
for the Agreement.4
Bargaining representative
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[16] There can be little doubt that a bargaining representative for a proposed
agreement will have standing to be heard in relation to an application to approve the
agreement. Bargaining representatives play a central and important role in the
agreement making scheme established by Part 2-4 of the FW Act. The FW Act places
obligations on and grants privileges to a bargaining representative for a proposed
agreement. These include:
imposing an obligation to meet the good-faith bargaining requirements;5
standing to apply for a majority support determination;6
standing to apply for a bargaining order if the good faith bargaining requirements
are not being met by other bargaining representatives;7
standing to apply for a scope order;8
standing to apply for a low-paid authorisation;9
standing to apply for the approval of an enterprise agreement10 and
the right of an employee organisation that was a bargaining representative for the
proposed agreement to give notice that it wants to be covered by the agreement.11
[25] Section 178 provides that an “appointment of a bargaining representative
comes into force on the day specified in the instrument of appointment”. It is not in
dispute that the instrument of appointment was signed by Employee 2 on 15 February
2014. As that instrument came into force on that day it must also follow that if the
CFMEU was a bargaining representative of Employee 2, that default position
pertained until and including 14 February 2014. That is in our view the effect of ss.178
and 176(1)(b). It follows that if the CFMEU had to that point been a bargaining
representative of Employee 2 for the proposed Agreement, it ceased to be so.12
[38] It does not follow however that the capacity of an employee organisation,
which is no longer a bargaining representative, to give notice under s.183, results in
the organisation having standing to make submissions or to otherwise be heard in
opposition to an application approval of an agreement. Section 183 is of limited utility.
It serves only to alert the Commission to the fact that an employee organisation that
was a bargaining representative for the proposed agreement now wishes to be covered
by the agreement. The result of a valid notice under s.183 is that the employee
organisation will be noted in the decision approving the agreement as being covered
by the agreement.13
[39] A notice under s.183 may only be given after the agreement is made. Properly
understood, the notice under s.183 is a notice that if the agreement as made is
approved by the Commission the employee organisation giving the notice wants to be
covered by it. It strains both the language and apparent purpose of s.183 to construe
the provision as providing a right to be heard in opposition to the approval of the
agreement. Consequently, the CFMEU did not obtain any right to be heard before the
Senior Deputy President by reason of its notice given under s.183 of the FW Act.
[2015] FWC 7345
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Right to be heard other than as bargaining representative
[48] It is accepted that the FW Act does not provide for intervention in proceedings
before the Commission by a non party. Section 590 of the FW Act provides, relevantly
that the Commission may, except as provided by the FW Act, inform itself in relation
to any matter before it in such manner as it considers appropriate, including by
inviting, subject to any terms and conditions determined by the Commission, oral or
written submissions.14
[54] As to the CFMEU’s rights that are said to be affected, the CFMEU submitted,
in summary, that the decision to approve the Agreement will affect its right to
represent employees at the mine and for these employees to be members of the
CFMEU. Further, it will affect its capacity to protect terms and conditions of
employment.15 Other rights relied in by the CFMEU are identified earlier and are not
reproduced here.
[55] In our view this argument has no substance. Firstly, the argument presupposes
that the CFMEU has some particular right which will be taken away or interfered with,
if the Agreement is approved. The CFMEU’s entitlement to represent the industrial
interests of employees at the Collinsville coal mine is to be derived from the
CFMEU’s rules. The approval of the Agreement will not interfere with that. Before
the Agreement was approved the terms and conditions of the employees covered by
the Agreement were determined, inter alia, by the Black Coal Mining Industry Award
2010, the applicable modern award. Under the dispute settlement procedure of the
modern award the CFMEU has no particular right of representation. Representation
may be sought by employees in relation to disputes and in relation to consultation.
Under the modern award employees choose their representation. They may choose the
CFMEU. That position is not changed by approval of the Agreement. Employees may
choose to be represented by the CFMEU in disputes under the Agreement and in
consultation matters. In any event such rights are vested in the employees not in the
CFMEU. The Modern Award is not a respondency award made in settlement of an
interstate industrial dispute involving the CFMEU. The statutory basis and
constitutional underpinning of modern awards are significantly different to awards
made under predecessor legislation in settlement of disputes.
[56] Secondly, the Agreement does not affect the rights of an employee covered by
it to choose whether he or she wishes to join, continue to be or cease to be, a member
of the CFMEU.
[57] Thirdly, the approval of the Agreement does not affect the right of the CFMEU
to be involved in bargaining for any successor or replacement agreement, nor does it
affect the right of the CFMEU to represent employees more broadly engaged in the
coal mining industry or to advocate for improvements to the terms and conditions
under which those employees are employed.
[58] Fourthly, the approval of the Agreement does not affect the capacity of an
officer of the CFMEU who is a permit holder under the FW Act to investigate
suspected contraventions of the FW Act or of the terms of the Agreement.16 Nor does
it affect the capacity of the permit holder to enter Collinsville’s premises for the
purposes of holding discussions with employees.17
[2015] FWC 7345
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[59] Fifthly, to the extent that it was suggested that the CFMEU’s capacity to
represent employees and protect their interests under the Coal Mining Safety and
Health Act 1999 (Qld) and the Coal Mining Safety and Health Regulation 2001 (Qld)
is undermined or taken away by the approval of the Agreement, that proposition is
rejected. As s.29 of the FW Act makes clear, an enterprise agreement applies subject
to, and does not prevail over, a State law dealing with occupational health and safety
matters. Such rights or interests as the CFMEU may have under those laws are clearly
unaffected by the approval of the Agreement.
[60] Sixthly, the CFMEU’s reliance on rights that it had under agreements which
previously applied to work at the Collinsville coal mine18 is misconceived in that
whatever else might be said about the content of those agreements, they did not cover
the employees who are now covered by the Agreement when the agreement was made
and they did not cover Collinsville. Consequently the CFMEU had no particular right
under those agreements vis-a-vis the employees or Collinsville, and so no right of the
CFMEU is affected by the approval of the Agreement.
[65] In our view the right, interest or legitimate expectation that is said to be
affected by application of the kind before the Senior Deputy President must be
identified and understood against the framework of enterprise bargaining and
agreement making established by the FW Act. It is not enough, without more, to point
to the status of the CFMEU as an employee organisation with a history of
representation at the workplace or in the industry. Moreover, this is not a case where
some of the members of the CFMEU voted against the approval of the Agreement or
did not vote at all. All of the employees covered by the Agreement voted, and all of
those employees (including Employee 2) voted in favour of approving the Agreement.
[66] The statutory framework includes that enterprise agreements are made
principally between an employer and employees; that bargaining representatives have
a role in relation to enterprise bargaining either by default or by appointment; that
default bargaining representatives can be displaced by appointment or by revocation;
that enterprise agreements operate primarily at the single enterprise level and do not
create rights of general application across an industry or have common rule
application; that rights of an employee organisation to be involved in the bargaining
process under the FW Act is not separate from its standing as a bargaining
representative; and that its capacity to be involved in protected industrial action by
seeking a protected action ballot authorisation cannot be separated from its standing as
a bargaining representative.
[68] An eligible union was entitled to be heard on an application to the Commission
to approve the implementation of an EFA.19 Further, s.170NB(1) of the IR Act
provided that an organisation of employees was entitled to be heard on such an
application if it was bound by an award that bound the employer party to the EFA in
respect of work performed in the relevant enterprise. There is no such express right to
be heard in the FW Act and the role of organisations of employees in the bargaining
and agreement approval provisions under the FW Act is very different to that provided
for in the IR Act.
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[69] That an employee organisation has an ongoing relationship with its members
who might become covered by an agreement and has a role under its rules in
representing those members is not relevant in the context of a right to be heard in
relation to the approval of an agreement.20 The FW Act does not confer a right on
employee organisations (other than in the case of the greenfields agreement) to be
covered by an agreement if it was not a bargaining representative. Likewise, the FW
Act does not confer upon an employee organisation a role in enterprise bargaining
under the FW Act outside of its status as a bargaining representative. The mere fact
that an employee organisation has an ongoing relationship with its members and is
entitled to represent their industrial interests is not a sufficient basis to conclude that
the approval of an enterprise agreement will adversely affect a right, interest or
legitimate expectation of that employee organisation.
[70] In similar vein, that an employee organisation has amongst its interests, objects
or expectations, that it will obtain and maintain reasonable employment conditions for
its members, is in the context of the bargaining framework established by the FW Act,
an insufficient basis for there to arise a right, interest or legitimate expectation and
thereby a conferral on the employee organisation of a right to be heard in relation to an
application to approve an enterprise agreement.
[72] Whether an employee organisation which is not a bargaining representative has
a right to be heard in relation to an application for the approval of an agreement will
depend on the circumstances in each case. In this case, when the rights, interests or
expectations asserted by the CFMEU are understood in the legislative context, it is
clear that the CFMEU has not established any right, interest or legitimate expectation
that would be adversely affected by the decision to approve the Agreement which
would give it a right to be heard.
[75] We would make the observation however, that the Commission may choose, in
a particular case, to hear from an employee organisation or any other person about the
approval of an agreement even though the organisation or person may not otherwise
have a right to be heard. The Commission has a broad power to inform itself in
relation to any matter in such manner as it considers appropriate, including by inviting
oral or written submissions from a person of organisation.21”
(my emphasis)
[13] Mr Hodgkinson argued that Collinsville was “on point” and that the Full Bench has
rejected every one of the CFMEU’s propositions and arguments.
[14] Mr Pearce argued that these applications were the exact opposite of Collinsville in so
far as the CFMEU has existing Agreements with each of these Companies.
[15] Mr Pearce argued that the real question of this decision is in relation to the “right of a
Union to be heard in circumstances where an Enterprise Agreement is being made that will
have the effect of making the existing Union Enterprise Agreement no longer operative.
[16] On this basis, Mr Pearce argued that Collinsville can be distinguished, because the
Union, as a separate legal entity then its members or the employees of the Company, has its
own rights under the Agreement which will be extinguished if these Agreements are
approved.
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[17] Mr Pearce submitted that the loss of the Union’s rights doesn’t mean that the
Agreements shouldn’t be approved but merely forms the basis on why the Union has a right to
be heard in relation to the approval of the Agreements.
[18] Mr Pearce took me to each of the Agreements and identified the following rights that
would be lost if the proposed Agreements are approved;
a) the CFMEU would no longer be a party to the Agreement;
b) the CFMEU would not be a member of the Company consultative committee;
c) the CFMEU would no longer be notified if any work was to be sublet to another
contractor;
d) the CFMEU would no longer be consulted if supplementary labour was required or
utilised;
e) the CFMEU would not necessarily be involved in any dispute;
f) the CFMEU would not necessarily be involved in any future negotiations.
Consideration
[19] I accept the proposition that Collinsville provides the relevant precedent in relation to
this matter. However, I note that Collinsville provides a broad discretion to the Fair Work
Commission to hear from any interested party. However, an Agreement is fundamentally
between the employer and its employees. A Union is only ever involved in any Agreement at
the invitation of its members.
[20] The CFMEU has members in each of the companies, except Bauer. Relevantly, the
CFMEU was not appointed as a bargaining representative by any of their members. Whilst I
do not know if there were any underlying reasons why the CFMEU was not appointed as an
employee bargaining representative, I am bound to accept the decision of the employees. I
have taken this into account.
[21] I do not accept the proposition that the CFMEU will lose any of its alleged rights as
identified in paragraphs 10 and 18 of this decision. All of these issues pertain to the protection
of the employees – not the Union. There has been no evidence from any employee that they
have any concerns in relation to the alleged issues/losses identified by the CFMEU. I have
taken this into account.
Conclusion
[22] I accept the obiter of the Full Bench decision in Collinsville. I agree with the
submission that the CFMEU has not proven that it has a sufficient interest to warrant the use
of the discretionary power identified in Collinsville.
[23] The CFMEU were not a bargaining representative for any of the Agreements. I do not
accept that any Union who has been a party to a previous Agreement gains an automatic right
[2015] FWC 7345
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to be heard in the approval process of the replacement Agreement. Whilst I have the utmost
respect for Mr Pearce, a replacement Agreement always renders the predecessor Agreement
inoperative, whether it be a union or non-union Agreement, in accordance with section 58 of
the Act. The CFMEU do not have the right to be heard in the approval process for these
Agreements.
[24] The jurisdictional objection of the MBA is upheld.
[25] Conferences will be convened to allow each of the companies the opportunity to
provide the necessary undertakings to allow their Agreement to be approved.
[2015] FWC 7345
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B. Wagstaff Pty Ltd
[26] The situation involving the Wagstaff Piling Pty Ltd Agreement (Wagstaff) is
fundamentally different to the other piling contractors on the basis that 22% of the Wagstaff
workforce nominated the CFMEU as their Bargaining Representative, in accordance with
section 176 of the Act. As a Bargaining Representative, the CFMEU has a right to be heard in
relation to this application.
[27] Like the other piling contractors, Wagstaff were involved in the failed negotiations
between the PFSF and the CFMEU.
[28] Following the failure of those negotiations to reach an Agreement, Wagstaff issued the
appropriate Notice of Employee Representational Rights form to its staff in accordance with
section 173 of the Act.
[29] The last of these forms was returned on 10 March 2015.
[30] Wagstaff met with the CFMEU on 11 March 2015. This meeting was concluded on
the basis that the CFMEU were allegedly going to notify a bargaining dispute to the Fair
Work Commission. No employee bargaining representatives were present at this meeting. No
notification was received by the FWC.
[31] The CFMEU wrote to Wagstaff on 12 March 2015 in the following terms;
“William Fleurs
Wagstaff Piling Pty Ltd
Dear Mr Fleurs,
Agreement Negotiations
We write to you on behalf of the employes of Wagstaff Piling Pty Ltd (Wagstaff) for
who the Construction, Forestry, Mining and Energy Union (CFMEU) is a bargaining
representative. We refer to the ongoing negotiations between the parties regarding a
proposed enterprise agreement.
The CFMEU has provided Wagstaff with a draft agreement for the purpose of
negotiating towards a final document. To date we have not received a response to this
draft or reason as to why the draft is not being considered by Wagstaff.
We request that you provide a written response to the CFMEU draft agreement, with
reasons for the response, by close of business 13 March 2015. Additionally, we
request that a meeting be organised between the company, the CFMEU and the
employees for early next week to continue negotiations.
If you have any questions please contact Tom Rigby.
[2015] FWC 7345
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Yours faithfully
Sherri Hayward
Industrial Officer”22
(my emphasis)
[32] Wagstaff responded to the CFMEU on 16 March 2015 in the following terms;
“16 March 2015
Ms Sherri Hayward
Industrial Officer
CFMEU
Dear Ms Hayward
Agreement Negotiations
Thank you for your letter dated 11 March 2015, regarding the ongoing negotiations
between Wagstaff Piling Pty Ltd (the Company), its Employees and the CFMEU and
concerns expressed toward an alleged failure to respond to a proposed draft enterprise
agreement.
As it currently stands, the Company has made it clear to the union through a series of
previous meetings held between the Piling and Foundation Specialists Federations
(PFSF) and Master Builders, in which the Company has been represented, that the
union ‘pattern agreement’ was unacceptable in respect to its terms proposed.
The Company through the PSFS and Master Builders, proposed a draft EBA
document, authored by PFSF members, to the CFMEU in September of last year. This
document was the only document discussed for a period of approximately four
months. The CFMEU in January of this year advised that the only document they
would continue the negotiation with was the CFMEU ‘pattern agreement’ which had
previously been rejected. The parties agreed to go their separate ways.
Wagstaff Piling is willing to discuss with the CFMEU representative and
discuss/negotiate the PFSF draft at a mutually convenient time.
I anticipate that the response provided above clarifies the history of this matter and
addresses the Company’s intention to continue to bargain in good faith.
Additionally, can you please ensure the correct name of the undersigned is used in any
future correspondence issued to this Company.
Yours sincerely
William Fleuter
NSW State Manager
Wagstaff Piling”23
(my emphasis)
[2015] FWC 7345
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[33] There were no meetings between the parties for the next 7 weeks. On Friday, 1 May
2015, Wagstaff notified its employees of five site meetings on Monday, 4 May 2015 to
discuss the Enterprise Agreement. On 4 May 2015, these meetings were changed to 6 May
2015. The CFMEU was not invited to these meetings. I have taken this into account.
[34] Employees were also given notice that Wagstaff would be putting their proposed
Enterprise Agreement to a ballot on 19 May 2015. No Bargaining Representatives were
involved in this decision. Following the site meetings on 6 May 2015, modifications were
made to the proposed Agreement based on these discussions. I have taken this into account.
[35] Mr Fleuter admitted that a final copy of the proposed Agreement was not sent to the
Bargaining Representatives prior to the ballot. Mr Fleuter also acknowledged that a copy of
the Modern Award (the Building and Construction General On-Site Award 201024) had not
been given, or made available, to the employees during the notice period. It is not in dispute
that the proposed Agreement refers to provisions contained in the Modern Award. I have
taken this into account.
[36] Mr Fleuter also accepted that the final document was not explained to the employees
during the access period. I have taken this into account.
[37] Relevantly, Mr Fleuter conceded that a meeting of the full Bargaining Committee, the
committee appointed by the employees of Wagstaff in accordance with the Act, did not occur.
It has never met. I have taken this into account.
[38] Mr Hodgkinson argued that the meetings on 6 May 2015 with all employees
constituted “good faith bargaining” because the attendees at those meetings were either self-
appointed bargaining representatives or employees. Mr Hodgkinson took me to the Full
Bench decision in Construction, Forestry, Mining and Energy Union – Mining and Energy
Division v Tahmoor Coal Pty Ltd25 (Tahmoor) which is, relevantly, a decision in relation to a
Bargaining Order rather than an application to approve an agreement. This decision deals with
the issues pertaining to good faith bargaining.
[39] In Tahmoor, the Company decided that the negotiations had been exhausted and put
the Agreement to a ballot of employees. I note that Tahmoor conducted 14 meetings with its
employees between 14 – 23 December 2014 without the CFMEU being invited to or being
given notice of, the meetings. Tahmoor then met with the full bargaining committee on 12
and 13 January 2015. I also note that there had been between 40-50 meetings conducted
between Tahmoor and the CFMEU representatives during the negotiation process. The
negotiation process had proven to be inconclusive.
[40] The proposed Agreement was provided to all Tahmoor employees and the CFMEU
on 9 February 2015, and the ballot was conducted on 18 and 19 February 2015.
[41] The Full Bench determined that;
“[24] Whether a party observes or fails to observe the good faith bargaining
requirements set out in s.288(1) is to be determined in light of all of the relevant
circumstances. While at one level this is stating the obvious, it is appropriate in view
[2015] FWC 7345
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of the submissions in the appeal to indicate that the question will rarely be decided by
reference to one action or series of actions. Equally it would be undesirable to read into
the legislation concepts which do not already appear in it for the purpose of explaining
its operation. That approach is likely to lead to error in the construction and application
of the provisions.
[28] The Commissioner found that the negotiations stalled in a serious way around
the end of November 2009. That finding has not been shown to be affected by error.
Although there had been a break between April and June 2009, negotiations had been
going on since October 2008. It is also apparent that by 10 December the two versions
of the proposed agreement, options 1 and 2, had been categorically rejected by the
union. In addition, the union draft agreement had been rejected by Tahmoor. There is
no basis for a conclusion that one side or the other is at fault. The Commissioner was
entitled to conclude that after a very long period of negotiation the parties were simply
unable to agree. In those circumstances the conclusion was open that it was not
capricious or unfair conduct for Tahmoor to seek to explain its negotiating position to
the employees directly.
[29] The CFMEU also relied on the fact that the employee meetings were designed
to encourage a view different from the one put forward by the bargaining agent.
Tahmoor may have been trying to influence employee views, but it does not
necessarily follow that its conduct undermined freedom of association or collective
bargaining or that it acted capriciously or unfairly. The proposals put to the employees
were the same as those put to the employee representatives at the bargaining meetings.
The meetings themselves do not appear to have been oppressive for employees and the
slides and other material used in the presentation were not deceptive or otherwise
objectionable. Indeed, there is no evidence that any of the material provided to
employees was misleading or that employees were threatened in any relevant way.
Nor is there any reason to believe that the employee representatives did not themselves
have adequate access to the workforce in relation to the bargaining process. It is also
relevant that the bargaining meetings continued during and after the employee
meetings and that Tahmoor took various steps, referred to above, to facilitate
consideration of its proposals by the employee representatives. In the circumstances of
this case holding the employee meetings and sending material to the employees’
homes was not capricious or unfair conduct that undermined freedom of association or
collective bargaining.
[30] We deal now with the ballot of employees. Although there may be
circumstances in which the conduct of a ballot without the agreement of other
bargaining agents constitutes a breach of the good faith bargaining requirements, it
will not always be so. There is no absolute requirement for the agreement of the
bargaining agents prior to the conduct of a ballot. In this case the Commissioner
and the parties all referred to the notion of “impasse” as the touchstone by which
to judge whether an employer who puts a proposed agreement to a ballot without
the agreement of the other bargaining agent thereby fails to observe the good
faith bargaining requirements. There was some debate about whether “impasse” had
been reached at the relevant time. The Commissioner found that “negotiations for an
enterprise agreement have reached a stalemate, or using Tahmoor’s words: “an
impasse”.26 Another way of approaching the matter, as the CFMEU intimated in
its submissions, might be to ask whether there had been a reasonable opportunity
[2015] FWC 7345
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to discuss Tahmoor’s latest proposal. Yet another formulation might be to ask
whether negotiations had reached such a stage that the employer was entitled to
put its proposal to a ballot in order to see if progress could be made. However it is
put, we are satisfied that in arranging to put its proposed agreement to the employees
in a ballot, Tahmoor was not acting capriciously or unfairly in the circumstances
prevailing at the time.”
(my emphasis)
I have taken this decision into account.
[42] The parties also referred me to the decision of Vice President Watson, in Liquor,
Hospitality and Miscellaneous Union v Mingara Recreational Club Ltd27 where the Vice
President held:
“[19] The obligations under the Act relate to genuine recognition and genuine
bargaining activities with other bargaining representatives. They do not preclude
concurrent communication and discussions with the employees who may be requested
to approve the agreement. In my view, an employer is free to meet with its employees
to discuss employment issues, including matters relevant to enterprise bargaining in
the absence of bargaining representatives. Widespread communication is to be
encouraged – not regulated, diminished or monopolised.”
[43] Whilst this decision also related to a Bargaining Order application, I agree with the
view of the Vice President. That the obligations under the Act do require genuine
recognition and genuine bargaining with other bargaining representatives. Unfortunately,
this did not occur in this instance. The CFMEU were deliberately ignored by Wagstaff. The
CFMEU was not given notice of the “bargaining meetings” with staff that were conducted on
6 May 2015.
I have taken this into account.
[44] The Full Bench decision in Collinsville, determined the following:
“[16] There can be little doubt that a bargaining representative for a proposed agreement
will have standing to be heard in relation to an application to approve the agreement.
Bargaining representatives play a central and important role in the agreement making
scheme established by Part 2-4 of the FW Act. The FW Act places obligations on and
grants privileges to a bargaining representative for a proposed agreement. These
include:
imposing an obligation to meet the good-faith bargaining requirements;
● standing to apply for a majority support determination;
standing to apply for a bargaining order if the good faith bargaining
requirements are not being met by other bargaining representatives;
standing to apply for a scope order;
standing to apply for a low-paid authorisation;
standing to apply for the approval of an enterprise agreement and
the right of an employee organisation that was a bargaining representative for
the proposed agreement to give notice that it wants to be covered by the
agreement.”
[2015] FWC 7345
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I have taken this into account.
Consideration
[45] The Full Bench decision in Tahmoor provides guidance in relation to this matter.
[46] Wagstaff has not participated in dozens of meetings with the CFMEU and the
employee Bargaining Representatives before deciding that an impasse or stalemate had been
reached in the negotiation. In fact, the Bargaining Committee did not meet – not even once. It
is not possible to reach an impasse without having a meeting. Also, the CFMEU were not
given an opportunity to discuss the final proposal that was the subject of the ballot process.
[47] There were no bargaining meetings or meetings with employees after the amendments
had been made to the Agreement following the meetings of employees on 6 May 2015.
I fail to see how this inactivity could possibly satisfy section 180(5) of the Act, ie, the
requirement to fully explain the terms of the Agreement.
[48] Despite the Agreement relying on the provisions of the Modern Award, employees
were not given a copy or access to the Modern Award during the access period. This failure is
a breach of s 180(2) of the Act.
[49] I am of the view that the failure by Wagstaff to advise the CFMEU of the ballot fails
the circumstances test contained in Tahmoor that I have highlighted earlier. The CFMEU
should have been able to rely on the commitment given by Wagstaff in their correspondence
by 16 March 2015 to “continue to bargain in good faith”. By failing to notify the CFMEU, a
duly appointed Bargaining Representative of the ballot, by not providing the CFMEU with a
final copy of the proposed Agreement, by refusing to negotiate with the CFMEU, by failing to
convene a meeting of the Bargaining Committee, by not advising the CFMEU of the meetings
on 6 May 2015, Wagstaff has failed to satisfy the good faith bargaining requirements of
section 228 of the Act.
[50] I accept that the CFMEU wanted to pursue its “pattern agreement,” however, the
union representatives may have been persuaded as to adopt the views of their members if they
had been given the chance to sit in a bargaining committee meeting. I am personally aware of
hundreds of occasions where union members have failed to take the advice of their union
official. Unfortunately, in this circumstance, the employees and the bargaining committee
were not given that opportunity.
Conclusion
[51] Taking into account all of the circumstances in this case and for the reason identified
above, I find that Wagstaff has not acted in accordance with the good faith bargaining
requirements of the Act.
[52] I also find that Wagstaff has breached a number of the pre-approval steps by failing to
provide all of the appropriate information and failing to explain the Agreement in the
mandatory manner.
[2015] FWC 7345
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[53] The application for approval of the Wagstaff Piling Pty Ltd Agreement is refused.
COMMISSIONER
Printed by authority of the Commonwealth Government Printer
Price code C, PR573276
[2015] FWC 7345
25
1 Outline of submission for CFMEU re standing to be heard
2 [2014] FWCFB 7940
3 We note that in CEPU and AMWU v Main People Pty Ltd [2014] FWCFB 8429 a Full Bench of the Commission
determined that a right to represent employees under the terms of the agreement and the likelihood that members of the
appellant unions would in the future be employed under the agreement resulted in the appellants having standing to
institute the appeal as those factors gave the appellants an interest beyond that of an ordinary member of the public. We
would observe that in the context of the statutory scheme established for agreement making and approval, the question
whether a person should be heard during an application to approve an agreement is a different question whether a person
is aggrieved by a decision for the purposes of bringing an appeal. For the reasons set out at [70] of our decision, we do
not regard the possibility or even likelihood that members of an employee organisation might in the future be employed
under the agreement as grounding a right to be heard. Nor does that fact that employees covered by an agreement might
choose to be represented by the employee organisation under particular terms of the agreement give rise to a right to be
heard. The right of representation under the terms of an agreement resides with the employee, not the organisation or
person selected by the employee to provide representation.
4 Transcript PN68 – PN71
5 Section 228
6 Section 236
7 Section 229
8 Section 238
9 Section 242
10 Section 185
11 Section 183
12 Section 176(1)(b), (c) and (4)
13 See section 201(2)
14 Section 590(1) and (2)(b)
15 Transcript PN134 – PN139
16 See section 481
17 See section 484
18 Transcript PN155 – PN157
19 Enterprise Flexibility Agreements Test Case May 1995 (1995) 59 IR 430 at 451
20 See CFMEU v Hamberger and Anor (2011) 195 FCR 74 in which Katzmann J discusses the meaning of “will be covered”
in s.172 of the Act and concludes at [69]-[79] that persons not yet employed but who might in the future be covered by an
agreement are not within the class of persons “who will be covered”; See also Mermaid Marine Vessel Operations Pty Ltd v
MUA [2014] FWCFB 1317 at [73]-[74] and CBI Contractors Pty Ltd v CFMEU [2011] FWAFB 7642 at [22]-[23]
21 Section 590
22 Exhibit C2 Annexure P
23 Exhibit C2 Annexure Q
24 MA000020
25 [2010] FWAFB 3510
26 Ibid at para 54.
27 [2009] FWA 1442
