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Fair Work Act 2009
s.185 – Application for approval of a single-enterprise agreement
Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures)
Act 2018
(AG2018/3842 and others)
JUSTICE ROSS, PRESIDENT
VICE PRESIDENT HATCHER
DEPUTY PRESIDENT SAUNDERS
MELBOURNE, 11 DECEMBER 2018
[1] This Statement concerns the amendment that will be made by the Fair Work
Amendment (Repeal of 4 Yearly Reviews and Other Measures) Act 2018 (Amending Act) to
s.188 of the Fair Work Act 2009 (Act), to confer a discretion on the Fair Work Commission
(Commission) to approve an enterprise agreement despite minor procedural or technical
errors.
[2] Section 186(1) of the Act requires the Commission to approve an enterprise agreement
if the requirements set out in ss.186 and 187 are met. If the agreement is not a greenfields
agreement, the approval requirements include that the Commission ‘must be satisfied that …
the agreement has been genuinely agreed to by the employees covered by the agreement’
(s.186(2)(a)).
[3] Section 188 of the Act provides that an enterprise agreement has been ‘genuinely
agreed’ to by the employees covered by the agreement if the Commission is satisfied that:
the employer, or each of the employers, covered by the agreement complied with:
o the pre-approval steps in ss.180(2), (3) and (5) — being that the employer must
take all reasonable steps to:
ensure that during the ‘access period’1, the ‘relevant employees’2 are given a
copy of the text of the agreement and any material incorporated by reference
into it, or have access throughout the access period to a copy of those
materials;
notify the relevant employees by the start of the access period of the time and
place at which the vote will occur and of the voting method; and
1 Defined in s.180(4) as the 7-day period ending immediately before the start of the voting process.
2 Defined in s.180(2) as ‘during the access period … the employees … employed at the time who will be covered by the
agreement’.
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STATEMENT
E AUSTRALIA FairWork Commission
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ensure that the terms of the agreement and their effect are explained to the
employees in an appropriate manner taking into account their particular
circumstances and needs; and
o the ‘notice of employee representational rights’ (NERR) requirement in s.181(2)
— being that employees not be asked to approve the agreement by voting on it
until at least 21 days after the day on which the last NERR under s.173(1) is given
(s.188(a));
the agreement was made by an employee vote in accordance with ss.182(1) or 182(2)
(s.188(b)); and
there are no other reasonable grounds for believing that the agreement has not been
genuinely agreed to by the employees (s.188(c)).
[4] Section 173 sets out the requirements for giving the NERR to employees:
the employer must take all reasonable steps to give the NERR to each employee who
will be covered by the agreement and is employed at the ‘notification time’3 (unless a
NERR was already given a reasonable period before the notification time) (ss.173(1)
and (4));
the employer must give the notice as soon as practicable, and not later than 14 days,
after the notification time (s.173(3)).
[5] Section 174 sets out content requirements for the NERR:
the NERR must contain the content prescribed by the regulations and no other content,
and be in the form prescribed by the regulations4 (s.174(1A)); and
the NERR must include the content prescribed in ss.174(2)–(5), which includes
specifying that the employee may appoint a bargaining representative to represent the
employee in bargaining for the agreement and in a matter before the Commission that
relates to bargaining for the agreement (s.174(2)).
[6] The Amending Act creates a discretion to find that an agreement has been genuinely
agreed to despite minor procedural or technical errors, by renumbering the s.188 as s.188(1)
and adding a new s.188(2) as follows:
‘(2) An enterprise agreement has also been genuinely agreed to by the employees
covered by the agreement if the FWC is satisfied that:
(a) the agreement would have been genuinely agreed to within the meaning of
subsection (1) but for minor procedural or technical errors made in relation to
the requirements mentioned in paragraph (1)(a) or (b), or the requirements of
sections 173 and 174 relating to a notice of employee representational rights;
and
3 Defined in s.173(2) as the time when the employer agrees to bargain or initiates bargaining for the agreement, or a majority
support determination, scope order, or low paid authorisation comes into operation.
4 See Fair Work Regulations 2009 reg 2.05 and the prescribed NERR in Schedule 2.1.
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(b) the employees covered by the agreement were not likely to have been
disadvantaged by the errors, in relation to the requirements mentioned in
paragraph (1)(a) or (b), or the requirements of sections 173 and 174.’5
[7] The Revised Explanatory Memorandum to the Fair Work Amendment (Repeal of 4
Yearly Reviews and Other Measures) Bill 2017 (EM) suggests that ‘minor procedural or
technical errors’ might include:
employees being informed of the time and place for voting on the proposed enterprise
agreement or the voting method that will be used for the agreement just after the start
of the access period rather than by the start of the access period (s.180(3));
employees being requested to approve a proposed enterprise agreement on the 21st
day after the last NERR was given, rather than at least 21 days after the day on which
the last NERR was given (s.181(2));
the inclusion of the employer’s company logo or letterhead on a NERR;
the inclusion of additional materials that are stapled with a NERR; or
minor changes to the text of the NERR that had no relevant effect on the information
that was being communicated in it (for example, the NERR may say to contact a
particular person in the human resources department rather than to ‘contact your
employer’).6
[8] The EM states that:
‘… It is intended that any disadvantage likely to have been suffered by employees, for
the purposes of paragraph 188(2)(b), must relate to the employees’ ability to genuinely
agree to the terms of the proposed agreement.
The effect of new subsection 188(2) is that an enterprise agreement will have been
genuinely agreed to despite any minor procedural or technical error if the employees (as
a whole) were not likely to have been disadvantaged by those errors.
…
When considering whether the employees were not likely to have been disadvantaged
by an error, in relation to the relevant procedural requirements, the FWC could take into
account, for example, the effect of the error and circumstances of the error.’7
[9] The Amending Act received the Royal Assent on 11 December 2018 and the
amendments to s.188 will commence on 12 December 2018.
[10] The new discretion under s.188(2) will apply in relation to an application under s.185
for approval of an enterprise agreement, where the application is made:
on or after 12 December 2018; or
before 12 December 2018 if any of the following circumstances apply:
5 Amending Act Schedule 2 item 2.
6 EM at para 47.
7 EM at paras 45-46 and 48.
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o the Commission had not decided the application on or before 12 December
2018; or
o the Commission had decided the application before 12 December 2018 and an
application to appeal had been made but the Commission had not made a final
decision on the appeal before 12 December 2018; or
o the Commission had decided the application within 21 days before 12
December 2018 and immediately before 12 December 2018 no application to
appeal had been made, but an application to appeal was made within 21 days
of the decision.8
[11] Staff of the Commission have undertaken a review of s.185 applications presently
before the Commission and have identified a number of examples of apparent non-
compliance with s.188 of the Act to which the new discretion may apply. These matters
reflect procedural or technical issues that are commonly identified in relation to s.185
applications. No Member of the Commission has yet considered whether these examples do
involve non-compliance with s.188.
[12] In order to provide some early clarity around the operation of the new s.188(2), the
President has decided to refer these matters to this Full Bench for hearing. The Full Bench
will only be dealing with this aspect of these s.185 applications; it will not determine whether
the agreements concerned are capable of approval (such as considering whether or not the
agreements pass the Better Off Overall Test).
[13] Where any of the matters requires further consideration as to whether or not the
agreement concerned is capable of being approved, it will be referred to a single Member for
decision.
[14] The referred matters (the Matters) are grouped below by issue type (some Matters may
be listed under more than one heading):
An earlier version of the NERR appears to have been given to employees who will be covered
by the agreement, not the current prescribed form (s.174(1A))
AG2018/6505 – Application by Core Toughened Pty Ltd
The content of the prescribed form of the NERR appears to have been altered (s.174(1A))
AG2018/6614 –Application by The Trustee for the Neish-King Family Trust T/A Kew
Swimming Pools [Issue – whether prescribed content has been omitted from the
NERR]
AG2018/6679 – Application by Royal Automobile Club of Victoria (RACV) Limited
[Issue – it appears that the reference to ‘employer’ in the final paragraph of the
prescribed NERR has been replaced with a reference to a particular person or position
title]
8 Amending Act Schedule 4 item 1.
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AG2018/6550 – Application by Axis Plumbing Services WA Pty Ltd [Issue – it appears
that the NERR was provided to employees as a memorandum on company letterhead]
Blank fields in the NERR may not have been properly completed (s.174(1A))
AG2018/4986 – N T Seaman T/A United Wolves [Issue – whether the legal name of
the employer has been included in the NERR]
AG2018/5778 – Application by CMTP Pty Ltd [Issue – the fields in the first paragraph
of the NERR appear to have been left blank]
AG2018/6679 – Application by Royal Automobile Club of Victoria (RACV) Limited
[Issue – whether the legal name of the employer has been included in the NERR]
Material provided with the NERR
AG2018/5778 – Application by CMTP Pty Ltd [Issue – it appears additional material
(a bargaining representative nomination form) has been provided to employees with
the NERR]
Pre-approval statutory timeframes may not have been met
AG2018/3482 – Application by Huntsman Chemical Company Australia Pty Limited
[Issue – whether the vote commenced less than 7 clear days from the date on which
employees were notified of the time, place and method of voting]
AG2018/6505 – Application by Core Toughened Pty Ltd [Issue – whether the vote
commenced less than 7 clear days from the date on which employees were notified of
the time, place and method of voting]
AG2018/6664 – Application by Meredith Roof Plumbing Pty Ltd [Issue – whether the
vote commenced less than 7 clear days from the date on which employees were
notified of the time, place and method of voting]
AG2018/4986 – N T Seaman T/A United Wolves [Issue – whether the vote commenced
less than 21 clear days after the last NERR was given to an employee]
[15] To assist the parties, the Commission has identified some issues as to the proper
construction of the new s.188(2) that might be raised by one or more of the Matters, as
follows:
1. What constitutes a ‘minor procedural or technical error’ within the meaning of
s.188(2)? Is it material whether the non-compliance with the relevant procedural or
technical requirement was unintended or deliberate or reckless?
2. In what ways might employees be ‘disadvantaged’ by a ‘minor procedural or technical
error’ for the purposes of s.188(2)?
3. In what circumstances are employees ‘not likely’ to be disadvantaged by a ‘minor
procedural or technical error’ for the purposes of s.188(2)? In what circumstances are
employees ‘likely’ to be disadvantaged by a ‘minor procedural or technical error’?
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4. The EM at paragraph 48 suggests that in considering whether the employees were not
likely to have been disadvantaged by a procedural or technical error, the Commission
‘could take into account, for example, the effect of the error and circumstances of the
error.’ What sort of material might the Commission need to consider in assessing this?
5. Would considering the effect of an error and the circumstances of an error include
taking into account the likely costs and inconvenience to the employer and the
employees covered by the agreement, associated with further delaying the approval of
the agreement?9
DIRECTIONS
1. The parties to each of the Matters are to lodge in the Commission written submissions
on the proper construction of s.188(2) of the Act and its application to their matter, on
or before 12 noon on Thursday 20 December 2018.
2. The Minister for Jobs and Industrial Relations, the Peak Councils (including the
Australian Industry Group, Australian Chamber of Commerce and Industry and the
Australian Council of Trade Unions) and any other interested persons are invited to
lodge in the Commission written submissions on the proper construction of s.188(2)
of the Act and its application to one or more of the Matters, on or before 12 noon on
Thursday 20 December 2018.
3. Parties seeking to make a submission may inspect relevant documents on the Matter
file or files.
4. Parties may seek to address some or all of the issues listed at [15]. That list is not
intended to be exhaustive, nor to limit in any way the parties’ capacity to discuss
further issues in their submissions to the Commission in relation to a particular
Matter.
5. The Matters are listed for hearing before this Full Bench of the Commission on
Friday 21 December 2018 at 11.00 am. A Notice of Listing will be published
shortly.
6. All material should be sent in a Word document to amod@fwc.gov.au.
9 See Productivity Commission, Workplace Relations Framework, Final Report, Vol. 2 at p.665.
mailto:amod@fwc.gov.au
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7. Copies of any submissions filed in response to these directions will be published
on the Commission’s website.
PRESIDENT
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PR703066
