1
Fair Work Act 2009
s.604 - Appeal of decisions
Construction, Forestry, Mining and Energy Union
v
Sparta Mining Services Pty Ltd
(C2016/1740)
VICE PRESIDENT HATCHER
DEPUTY PRESIDENT LAWRENCE
COMMISSIONER MCKENNA SYDNEY, 10 OCTOBER 2016
Appeal against decisions [2016] FWC 3100 dated 5 July 2016 and [2016] FWCA 4528 dated
6 July 2016 of Commissioner Spencer at Brisbane in matter number AG2016/2507.
Introduction
[1] The Construction, Forestry, Mining and Energy Union (CFMEU) has lodged an
appeal, for which permission to appeal is required, against a decision of Commissioner
Spencer issued on 5 July 2016 (First Decision)1 and a further decision issued on 6 July 20162
(Second Decision) in which approval was given to the Sparta Mining Services Pty Ltd
Enterprise Agreement 2016 (Agreement). The CFMEU contends that the Commissioner erred
in concluding that the employer covered by the Agreement, Sparta Mining Services Pty Ltd
(Sparta), complied with s.180(2) of the Fair Work Act 2009 (FW Act) prior to the vote to
approve the Agreement. It contends that permission to appeal should be granted, the appeal
should be upheld, and that Sparta’s application for approval of the Agreement should be the
subject of a re-hearing. In any such re-hearing, the CFMEU contends that the question of
whether the requirement in s.186(2)(a) read with s.188(c) was satisfied should be re-
considered along with the issue of compliance with s.180(2).
Statutory framework
[2] Section 180(2) provides:
(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:
1 [2016] FWC 3100
2 [2016] FWCA 4528
[2016] FWCFB 7057
DECISION
E AUSTRALIA FairWork Commission
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(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] Compliance with s.180(2) is mandatory for an enterprise agreement to be approved by
the Commission. Section 186(1) provides that the Commission must approve an enterprise
agreement if the agreement meets the requirement set out in ss.186 and 187. Section 186(2)(a)
provides:
(2) The FWC must be satisfied that:
(a) if the agreement is not a greenfields agreement – the agreement has been
genuinely agreed to by the employees covered by the agreement; ...
[4] Section 188 defines when employees may be considered to have genuinely agreed to
an enterprise agreement as follows (underlining added):
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);
(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.
[5] Where an enterprise agreement does not comply with the requirements of ss.186 and
187, the Commission has no power to approve the agreement except in accordance with
ss.189 or 190. Section 189 allows for the approval of agreements which do not meet the better
off overall test if, because of exceptional circumstances, it would not be contrary to the public
interest to do so. That provision was not applied here. Section 190 provides for the approval
of enterprise agreements with undertakings as follows:
190 FWC may approve an enterprise agreement with undertakings
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Application of this section
(1) This section applies if:
(a) an application for the approval of an enterprise agreement has been
made under section 185; and
(b) the FWC has a concern that the agreement does not meet the
requirements set out in sections 186 and 187.
Approval of agreement with undertakings
(2) The FWC may approve the agreement under section 186 if the FWC is
satisfied that an undertaking accepted by the FWC under subsection (3) of this section
meets the concern.
Undertakings
(3) The FWC may only accept a written undertaking from one or more employers
covered by the agreement if the FWC is satisfied that the effect of accepting the
undertaking is not likely to:
(a) cause financial detriment to any employee covered by the agreement;
or
(b) result in substantial changes to the agreement.
FWC must seek views of bargaining representatives
(4) The FWC must not accept an undertaking under subsection (3) unless the FWC
has sought the views of each person who the FWC knows is a bargaining
representative for the agreement.
Signature requirements
(5) The undertaking must meet any requirements relating to the signing of
undertakings that are prescribed by the regulations.
[6] It may be seen that for s.190 to apply, the Commission must hold a concern that the
relevant agreement does not meet the requirements of ss.186 and 187. Unless such concerns
are held, s.190 does not apply and thus consideration of the acceptance of any such
undertaking cannot arise. Where s.190 does apply, under s.190(2) the relevant agreement may
only be approved if the Commission is satisfied that the undertaking would address the
identified concern about compliance with ss.186 and 187.
The proceedings before the Commissioner and the Decisions
[7] In the proceedings before the Commissioner, the CFMEU was granted leave to
intervene. The primary aspect of the CFMEU’s case against the approval of the Agreement
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was that it did not, as required by s.186(2)(d), pass the better off overall test set out in s.193.
Its case in that respect was rejected by the Commissioner in the First Decision, and because
her conclusions on that score were not challenged in the appeal, it is not necessary to discuss
this issue any further at this point. The CFMEU also submitted at first instance that the
approval requirement in s.180(5) had not been complied with, but again this submission was
rejected by the Commissioner, and that rejection is not challenged in the appeal.
[8] The CFMEU’s case before the Commissioner that s.180(2) had not been complied
with was founded on the proposition that cll.2.5, 6.1, 6.2 and 14.4.2 incorporated by reference
certain documents external to the Agreement. These provisions were as follows:
“2.5 This Agreement is supported by policies and procedures determined by the
Employer from time to time. These policies and procedures will not reduce the
Employee's substantive entitlements contained in this Agreement but provides
guidelines for the fair and efficient administration of the employment relationship.
...
6.1 The Employer agrees to comply with State and Commonwealth Occupational
Health & Safety laws and any relevant industry codes of practice.
6.2 The Employee agrees to carry out any instructions, policies and decisions made to
promote and maintain a safe workplace required by relevant occupational Health and
Safety legislation, including any further requirements specific to the Employer’s
industry and workplace – even if not specified in the legislation.
...
14.4.2 You will not be required to work more than 5 hours without taking a break
unless there are extenuating circumstances and in accordance with the site 'Fitness for
Work' and 'Fatigue Management Policy'.”
[9] It was not in dispute before the Commissioner that Sparta had not provided any of its
employees to be covered by the Agreement with a copy of any of the documents referred to in
cll.2.5, 6.1, 6.2 and 14.4.2 prior to the vote upon the Agreement. However Sparta submitted
before the Commissioner that:
for the purposes of cll.2.5, 6.2 and 14.4.2, Sparta had no policies in place of the type
referred to in the provisions; and
by reference to the Full Bench decision in McDonald’s Australia Pty Ltd; Shop,
Distributive and Allied Employees’ Association3 (McDonalds) the legislation and
industry codes of practice were “laws of the land ... available to Australian citizens
in a variety of ways”, so that there were no further steps required to be taken to
comply with s.180(2).4
[10] Sparta also proffered an undertaking pursuant to s.190 which included the following
paragraph:
“…the employer…
3 [2010] FWAFB 4602; (2010) 196 IR 155
4 Ibid at [43]
[2016] FWCFB 7057
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5. Will give and explain to employees the policies and procedures referred to at
clause 2.5, the policies to promote and maintain a safe workplace referred to at clause
6.2 and the Fitness for Work and Fatigue Management Policy referred to at clause
14.4.2, upon any such policy or procedure being developed by the employer.”
[11] The Commissioner’s conclusions with respect to this aspect of the matter before her
were contained in the First Decision as follows:
“[163] It is noted that section 42 of the Coal Mining Safety and Health Regulation 2001
(Qld) provides that a coal mine’s safety and health management system must be
developed in consultation with a cross-section of workers in developing the fitness
provisions, and that a site senior executive must make a reasonable attempt to establish
any criteria for the assessment of workers provided for in the fitness provisions in
agreement with a majority of workers at the mine, or a recognised standard applies.
[164] The absence of Sparta policies and procedures at the time of making the
Agreement have been considered, in addition to the further Undertaking on this issue:
“5. Will give and explain to employees the policies and procedures referred to
at clause 2.5, the policies to promote and maintain a safe workplace referred
to at clause 6.2 and the Fitness for Work and Fatigue Management Policy
referred to at clause 14.4.2, upon any such policy or procedure being
developed by the employer.”
[165] The Union has not justified that the Employer has not complied with sections
180(2) or 188(1)(a) of the Act in terms of provision of or explanation of policies and
procedures at the time of making the agreement, as the employer entity did not have
such at that time. In addition, the relevant Undertaking remedies this matter.”
[12] The Commissioner recorded her formal approval of the Agreement, with certain
undertakings, in the Second Decision.
Appeal submissions
[13] The CFMEU submitted, in support of its appeal grounds, that:
as a labour hire company providing labour to coal mining sites, the policies referred
to in cll.6.2 and 14.4.2 of the Agreement were not just Sparta’s policies, but those of
the operators of the coal mines at which Sparta’s employees worked - as was
confirmed in the evidence of Mr Lee Jansen, Sparta’s Human Resources Manager;
the three employees who voted upon the Agreement worked at two specific mines,
Broadmeadow and Carborough Downs in Queensland, and it would have been
reasonable to provide them with copies of the policies applicable under cll.6.2 and
14.4.2 at those sites;
the First Decision at paragraph [165] treated the fact that Sparta had no policies
during the Agreement’s approval process as the complete answer to the CFMEU’s
submissions that s.180(2) was not complied with respect to cll.6.2 and 14.4.2, but it
[2016] FWCFB 7057
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did not deal with the problem that those provisions incorporated policies of coal
mine operators and not just Sparta;
the First Decision did not deal with the failure to provide the industry codes of
practice referred to in cl.6.1 at all;
the Commissioner’s reliance on the undertaking was in error because, firstly, she did
not have any concern that the requirements of ss.186 or 187 had been met so that
s.190 did not apply and, secondly, the undertaking could not in any event remedy
non-compliance with s.180(2); and
the First Decision was in error in paragraph [165] in that it treated the CFMEU as
having to satisfy the Commission that s.180(2) was not complied with, when it was
for Sparta to satisfy the Commission that s.180(2) was complied with.
[14] Sparta’s submissions did not in any substantial way seek to deny the errors contended
for by the CFMEU. However it advanced a number of reasons why, notwithstanding any error
in the Commissioner’s approach, permission to appeal should be refused or alternatively the
appeal should not be upheld. Sparta submitted that:
the phrase “material incorporated by reference in the agreement” in s.180(2)(a)(ii)
was to be read as encompassing only a specifically named or identified document or
other written material;
certainty as to the material incorporated was necessary because the effect of
incorporation was to establish an enforceable obligation or entitlement;
cll.6.2 and 14.4.2 did not incorporate by reference any of the documents mentioned
in those provisions because they were not named or described with sufficient
particularity, so no question of compliance with s.180(2) arose;
there was evidence in any event that the employees who voted upon the Agreement
had been provided with the policies referred to in cll.6.2 and 14.4.2 when inducted at
the mine sites where they worked, and had continued access to them on the mine
operator’s intranet; and
the industry codes of practice referred to in cl.6.1 were akin to the publicly available
laws of the land referred to in McDonalds, so no step was required to make them
available or give access to them.
Consideration
[15] We consider that the Commissioner erred in her consideration as to whether s.180(2)
had been complied with for three reasons:
(1) The First Decision did not deal at all with the question of whether Sparta had
complied with s.180(2) in relation to the industry codes of practice referred to
in cl.6.1.
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(2) The Commissioner treated the fact that Sparta had not yet developed any
policies which it could give or provide access to for the purpose of s.180(2) as
determinative with respect to cll.6.2 and 14.4.2. However the policies of
relevance to the obligations under these provisions were primarily those of the
operators of coal mines to which Sparta provided labour, as Mr Jansen
accepted in his evidence.5 The question of whether s.180(2) was complied with
in relation to these policies was likewise not dealt with in the First Decision.
(3) The Commissioner erred by relying on paragraph 5 of the undertakings with
respect to the issue of compliance with s.180(2). Because the Commissioner
never identified any concern that this element of the “genuinely agreed”
requirement in s.186(2)(a) had not been satisfied, the jurisdictional prerequisite
in s.190(1)(b) for the application of s.190 to this issue was not fulfilled. Further
and in any event, paragraph 5 of the undertakings was incapable of addressing
any concern that may have existed about compliance with s.180(2). The
statutory purpose of s.180(2) is clear: where a proposed enterprise agreement
contains, as material incorporated by reference in the agreement, entitlements
or obligations derived from an external document, that document is to be
provided to employees to be covered by the agreement before they vote upon it
so that they know what the content of those entitlements or obligations are
when they consider whether to approve the agreement. That is why compliance
with s.180(2) is an element of the requirement for an enterprise agreement to
have been “genuinely agreed” by the employees who voted upon it. A failure
to provide any such external documents is not answered or addressed by
providing employees with the documents after they have voted and after the
agreement has already taken effect.
[16] Sparta’s submission that, for the purpose of s.180(2), “any other material incorporated
by reference in the agreement” means documents or materials which are specifically named or
identified, and that cll.6.1, 6.2 and 14.4.2 did not satisfy this criterion, is on one view a
surprising submission for it to have advanced. It is plain that those particular provisions of the
Agreement establish entitlements or obligations which operate by reference to documents
external to the Agreement. Clause 6.2 is expressed in terms of an obligation agreed to by
employees to carry out “any instructions, policies and decisions” of an occupational health
and safety nature. Clause 14.4.2 effectively allows employees to be required to work more
than five hours without a break where permitted by identified site policies. It was not
submitted that in either case the provision was merely of an “aspirational”, “descriptive”,
“advisory”, “informational” or “promissory” nature.6 The content of those entitlements or
obligations can only be understood by reference to the external documents referred to. While
at least cl.6.2 might, insofar as it refers to “instructions” and “decisions”, be read as referring
to such management instructions and decisions as may be made from time to time in the
future, the reference in both clauses to policies of a specific nature are clearly intended to
import the obligations of those policies into the Agreement. That included policies extant at
the time the Agreement was made.
[17] Although not expressly put this way by Sparta, its submission is tantamount to saying
that cll.6.2 and 14.4.4 are void for uncertainty on the basis that because the policies referred to
5 Transcript 16 May 2016 PNs 456-471
6 See Transport Workers' Union of Australia v K&S Freighters Pty Ltd [2010] FCA 1225 at [65], (2010) 205 IR 137
[2016] FWCFB 7057
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are not named, the content of the obligations or entitlements in them cannot with certainty be
identified. A submission of that nature (which was not advanced at first instance), if upheld,
might raise grounds for believing that the Agreement was not genuinely agreed because a
number of provisions have never been considered by the employer to be legally operative.
[18] In any event, we do not accept the submission. None of the decisions to which our
attention was drawn by Sparta stands for the proposition that, in order for a clause to be
regarded as incorporating material by reference for the purpose of s.180(2), such material
must be specifically described by name. It is of course the case that in order for a clause
incorporating entitlements or obligations from an external document to be legally effective,
that document must be described in a way which permits it to be identified. However there is
no rule as to how in a particular case this is to be done, nor is there any rule against
incorporation where the external document is referred to by general description. For example
in Riverwood International Australia Pty Ltd v McCormick7 the Federal Court Full Court held
(by majority) that a provision in an employment contract which stated “You agree to abide by
all Company Policies and Practices currently in place, any alterations made to them, and any
new ones introduced” was effective in incorporating the employer’s redundancy policy as a
term of the contract. In this case, we consider that insofar as cll.6.2 and 14.4.2 refer to
policies, they are described with sufficient particularity as to permit the provisions to be
legally effective. Consideration as to compliance with s.180(2) was required with respect to
any extant policies of the types described in the provisions.
[19] In relation to cll.6.2 and 14.4.2, Sparta also submitted there was evidence that its
employees at the time of the approval process for the Agreement would have, upon induction
at the mine sites at which they worked, been given access to the policies referred to in those
provisions, and they would have remained accessible on the intranet. We acknowledge
evidence to that effect was, at least in general terms, given by Mr Jansen at the hearing before
the Commissioner in re-examination.8 However Mr Jansen also gave evidence that Sparta
could “easily” have given the same policies to its employees during the approval process for
the Agreement.9 The Decision gave no consideration as to this evidence in the context of the
question of compliance with s.180(2). Because Mr Jansen’s evidence did not specifically
address whether the policies were accessible to the employees during the “access period” as
required by s.180(2)(b), nor whether any access to the policies constituted a step taken by
Sparta as the employer, we do not consider that it constitutes, as submitted by Sparta, a
complete answer to the appeal insofar as cll.6.2 and 14.4.2 are concerned. Further, Mr
Jansen’s evidence clearly makes available the conclusion that the provision of copies of the
policies referred to in the two provisions to employees would have been a reasonable step for
the purpose of s.180(2)(a). This is an issue which, we consider, requires further exploration in
light of the Commissioner’s failure to deal with this issue.
[20] Finally we deal with Sparta’s submission that, regardless of the Commissioner’s
failure to deal with the industry codes of practice referred to in cl.6.1, the application of the
Full Bench decision in McDonalds would lead to the conclusion that they were “laws of the
land” to which it could be presumed that employees had access during the access period.
[21] The relevant part of the decision in McDonalds is as follows:
7 [2000] FCA 889, (2000) 177 ALR 193
8 Transcript 16 May 2016 at PNs 515-523
9 Transcript 16 May 2016 at PNs 458-475
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“[40] The Commissioner decided to dismiss the application on the further ground that
the employers did not provide employees with a copy of the National Employment
Standards (NES) and did not provide employees in Broken Hill with a copy of the
South Australian Long Service Leave Act 1987. The Commissioner determined that
these documents were required to be provided to employees under s 180(2)(a)(ii).
[41] The appellants challenged the statement of the legislative requirement by the
Commissioner. They submitted that there is a misstatement of the test which requires
reasonable steps to be taken. We agree that the Commissioner misstated the test.
[42] The appellants also challenged the conclusion reached. Section 180(2) requires
employers to take reasonable steps to ensure that employees have access to the
agreement and other incorporated documents. This will particularly relate to
documents that are not otherwise in the public domain. The appellants asserted that
while the Agreement refers to the NES in various respects it does not incorporate the
terms of the NES into the Agreement.
[43] We have reviewed the terms of the Agreement and agree with that submission.
References in the Agreement to the NES do not incorporate the terms of the NES into
the Agreement. The South Australian Long Service Leave Act 1987 is however
incorporated because the terms of the agreement provide for its application in Broken
Hill - which is beyond its legislative effect. The benefits are greater than those
provided by New South Wales legislation. The laws of the land are available to
Australian citizens in a variety of ways. We find that the employer was not required to
take any further steps to ensure that the relevant employees had access to the South
Australian legislation. Because the legislation is freely available in the public domain,
no further steps were required.”
[22] We consider the above passage is to be read on the basis that the Full Bench took
judicial notice of the fact that legislation, including South Australian legislation, is readily
available to citizens in a number of ways (most notably on the internet), and therefore
presumed for the purpose of s.180(2)(b) that it was accessible to employees during the access
period. However it must be noted that the subsequent Full Bench decision in National
Tertiary Education Industry Union v University of New South Wales10 left open the possibility
that paragraph [43] of McDonalds above may not be universally applicable, but rather that
“that there may be cases where the characteristics of the workplace and the composition of the
workforce may require more than what that Full Bench indicated was adequate”. We further
note that McDonalds did not explain how the mere availability of material in the public
domain meant that there was no reasonable step at all which the employer could have taken to
ensure access to a copy of the material.
[23] In any event, we do not consider the conclusion in McDonalds is automatically
applicable to the industry codes of practice referred to in cl.6.1. Although we understand these
industry codes of practice to be instruments made pursuant to workplace health and safety
legislation, we have no particular knowledge as to how readily accessible they are, nor did the
evidence in the matter deal with this. We suppose they are available somewhere on the
internet for someone who knows where to look, but it does not necessarily follow from that
10 [2011] FWAFB 5163 at [24], (2011) 210 IR 244
http://www.austlii.edu.au/au/legis/sa/consol_act/lsla1987179/
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conjectural proposition that it was not reasonable for Sparta to take any steps at all to give
employees copies of them or otherwise provide access to them in order to comply with
s.180(2). Sparta’s submission concerning cl.6.1 therefore does not answer the failure to deal
with that provision in the context of s.180(2) in the First Decision.
[24] We consider the errors in the First Decision we have identified are of a nature which
justifies the grant of permission to appeal. The issue of compliance with s.180(2) therefore
requires a rehearing. Because it may be necessary to hear further evidence in relation to this
issue, we think the appropriate course is to remit the matter to the Commissioner for that
purpose rather than conducting the rehearing ourselves. However we consider it would be
premature at this stage to quash the Decisions because although we are satisfied that the
Commissioner erred in the process of her consideration of s.180(2) in that she failed to deal
with the matters we have identified, it has not yet been established that her ultimate
conclusion that s.180(2) was complied with was incorrect.
[25] It remains necessary for us to deal with the CFMEU’s submission that in any rehearing
there should be reconsideration of whether the requirement in s.186(2)(a) that the Agreement
had been “genuinely agreed to by the employees covered by the agreement” having regard to
the associated requirement in s.188(c) that the Commission be satisfied that there “are no
other reasonable grounds for believing that the agreement has not been genuinely agreed to
by the employees”. The CFMEU did not at the hearing before the Commissioner advance any
argument that the Agreement was not genuinely agreed for the purpose of s.186(2)(a).
Consequently, the Commissioner gave no specific consideration to this issue beyond simply
recording a finding in the Second Decision that she was satisfied that (relevantly) the
requirements of ss.186 and 188 had been met.
[26] The usual principle is that a party should not be permitted to argue a case on appeal
which it did not raise at first instance.11 We think this principle would extend to any rehearing
that occurs consequential upon an appeal. However that principle may be departed from if
there is information brought to the attention of a Full Bench which strongly suggests that an
enterprise agreement should not have been approved in accordance with the relevant
provisions of the FW Act. A significant recent example of this is Hart v Coles Supermarkets
Australia Pty Ltd and Bi-Lo Pty Limited12, in which the Full Bench granted permission to
appeal a decision to approve an enterprise agreement covering Coles and Bi-Lo supermarkets
and conducted a re-hearing on the basis of information suggesting that the agreement in
question did not satisfy the better off overall test. Ultimately the decision to approve the
agreement was quashed. The Full Bench initially articulated the “usual principle” to which we
have referred in the context of the enterprise agreement approval process as follows:
“[44] We are more concerned about other aspects of the matter. Ordinarily, a party who
seeks to exercise a right of appeal should raise issues in the matter before a single
member and seek to have those issues considered. A failure to do so may disqualify a
person from seeking to advance new arguments in an appeal. There are many policy
reasons for this general proposition. These policy considerations may also have
application to enterprise agreement approvals. Enterprise agreement making is a
difficult and time consuming exercise. In this case, the agreement covers
approximately 77,000 employees employed at diverse locations throughout Australia.
11 See ASU v Yarra Valley Water Corporation [2013] FWCFB 7453, (2013) 232 IR 440 at [23]-[24]
12 [2015] FWCFB 7090
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The processes of commencing bargaining, negotiating an agreement, seeking approval
of employees and then seeking approval of the Commission are bound to occur over
an extended period. In this case the process took in the order of 18 months. The
processes could become unworkable if a person who had a reasonable opportunity to
engage in the process, does not engage in the process until the appeal stage, and seeks
to overturn the approval of an agreement after it has been approved by employees and
the Commission. Permitting an appeal in those circumstances is a public interest
consideration.”
[27] Notwithstanding this the Full Bench went on to say:
“[47] In the circumstances of this matter, we are of the view that confidence in the
agreement approval process would be enhanced if all of the material intended to be
relied upon by Mr Hart is considered. This Agreement affects a very large number of
employees who could be disadvantaged if the BOOT is not properly satisfied.
Although we have assumed that an arguable case of error exists, we cannot form a
view about such matters without considering the evidence all parties wish to adduce
and allowing it to be tested. To enable such a process to occur we propose to grant
permission to appeal and allow the parties to lead such additional evidence as they see
fit. A member of this Bench will give directions and convene a hearing to receive that
evidence. We would then convene a hearing to determine whether the appeal should
be allowed and determine any consequential measures arising from our analysis of the
evidence.”
[28] In this case the evidence before the Commissioner demonstrated that:
the very similarly-named Spartan Mining Services Pty Ltd (Spartan) was a pre-
existing labour hire company which had operated in the coal mining industry for
many years and had a number of employees;
Sparta and Spartan were associated corporate entities, with a common management
team, common premises and common addresses;13
Mr Jansen was Human Resources Manager for both Spartan and Sparta, and from his
perspective apart from the fact that they were different legal entities there was “not a
lot” of difference between them;
the three employees of Sparta who voted upon the Agreement were previously
employed by Spartan, and were employed by Sparta for the sole purpose of
negotiating the enterprise agreement;14
the three employees were selected (in about November/December 2015) on the basis
that they had the “intellectual ability” to go through the enterprise agreement
process;15
two of the three employees were supervisors of persons employed by Spartan;16
13 First Decision at [4]; Transcript 16 May 2016 PNs 98-99
14 Transcript 16 May 2016 PN 319
15 Transcript 16 May 2016 PN 299
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Sparta intended to “ramp up the manning” once the Agreement was approved;17
the Agreement was voted upon by a show of hands in Mr Jansen’s office;18
the three employees were not paid in accordance with the provisions of the
Agreement, but at all times were paid above-award rates, and entitlements which
were superior to the Agreement, which Sparta committed to continue for them
only;19
Sparta had not developed any policies and procedures of its own dealing with
workplace health and safety notwithstanding that it operated in the coal mining
industry.20
[29] Two additional factual matters emerged during the hearing of the appeal, largely in
response to inquiries from the bench. The first was that the three employees who voted upon
the Agreement were no longer employed by Sparta, but were now employed by another
labour hire company at the same coal mine sites. Whether this other labour hire company was
of a Lacedaemonian character was not disclosed. Second, Sparta now employs approximately
40 employees.
[30] Those facts (which were not disputed by Sparta) give rise, we consider, to arguable
grounds for concluding that the Agreement was not genuinely agreed to by the employees.
They are capable of giving rise to the inference that the vote in favour of the Agreement by
the three employees was not authentic because the employees were selected to be employed
by Sparta purely for the purpose of making the Agreement, the provisions of the Agreement
were not intended to apply to the three employees, and the employees were not to continue to
be employed by Sparta after the Agreement was approved.21
[31] In light of those facts, we consider that it would be in the public interest and would
enhance confidence in the agreement approval process for the rehearing to involve a
reconsideration of the requirements of s.186(2)(a) and s.188(c). In order that this issue be re-
determined appropriately, we consider that it will be necessary to allow Sparta and the
CFMEU to adduce further evidence if they wish to do so.
[32] Once the Commissioner has made her findings in respect of the re-hearing, the matter
will return to us for the making of any further orders as may be necessary.
[33] In the course of the hearing of the appeal, there were some issues raised in questions
from the bench bearing upon certain aspects of the Agreement which had not been raised by
either party at first instance or in the appeal and which were not the subject of consideration in
the Decisions. A summary of these issues is contained in the Schedule to this decision. These
16 Transcript 16 May 2016 PNs 324-325; Affidavit of Lee Jansen sworn 4 May 2016, paragraph 46
17 Transcript 16 May 2016 PNs 322-323
18 Transcript 16 May 2016 PN 370
19 Transcript 16 May 2016 PNs 374-378, 389-416
20 Transcript 16 May 2016 PN 421-429
21 See the analysis in KCL Industries Pty Ltd [2016] FWCFB 3048 at [24]-[42], (2016) 257 IR 266
[2016] FWCFB 7057
13
issues may arise for further consideration if it ultimately becomes necessary to quash the
Decisions and re-determine the application for approval of the Agreement.
Orders
[34] We order as follows:
(1) Permission to appeal is granted.
(2) The matter is referred to Commissioner Spencer for the purpose of re-
determining whether the approval requirement in s.186(2)(a) of the FW Act
was satisfied having regard to:
(a) the requirement in s.188(a)(i) for compliance with s.180(2); and
(b) the requirement in s.188(c) for the Commission to be satisfied that there
are no reasonable grounds for believing that the agreement has not been
genuinely agreed to by the employees.
(3) For the purpose of the re-determination process required by order (2), Sparta
and the CFMEU shall be permitted to adduce further evidence.
(4) The matter will be returned to this Full Bench for the making of any further
orders as may be necessary after the Commissioner has made findings pursuant
to order (2).
VICE PRESIDENT
Appearances:
A. Walkaden for the Construction, Forestry, Mining and Energy Union.
J.W. Merrell of counsel with S. McSwan solicitor for Sparta Mining Services Pty Ltd.
Hearing details:
2016.
Sydney/Brisbane by video-link:
21 September.
Printed by authority of the Commonwealth Government Printer
Price Code C, PR585999
OF THE FAIR WORK MISSION THE
[2016] FWCFB 7057
14
Schedule of Issues
(1) Whether cl.2.4 of the Agreement may constitute an unlawful term within the meaning
of s.194(ba) of the FW Act, given it may contemplate a type of “opting-out” provision.
(2) Whether the apparent absence of any basis upon which allowances may be calculated,
given there is no “Mineworker Class B” classification in the Agreement, needed to be
taken into account in the application of the better off overall test.
(3) Whether cl.28 of the Agreement, dealing with redundancy, needed to be taken into
account in the application of the better off overall test having regard to the departures
from the clause contained in the reference instrument such as the apparently narrowed
definition of redundancy at cl.28.4.2 and the operation, for example, of s.123(4)(c) of
the FW Act.
(4) Whether the cashing-out of annual leave clause (cl.16.1.10) in the Agreement meets
the requirements of s.93 of the FW Act.
(5) Whether the consultation term (cll.37-46) in the Agreement meets the requirements of
s.205 of the FW Act.
