[2018] FWC 4638
The attached document replaces the document previously issued with code [2018] FWCA
4521 on 7 August 2018. The medium neutral citation and PrintID have been amended. The
paragraph numbering and a cross reference at paragraph [199(a)] have also been corrected.
Associate to Deputy President Sams
13 August 2018
1
Fair Work Act 2009
s 185 - Application for approval of a single-enterprise agreement
Noorton Pty Ltd t/ a Manly Fast Ferry
(AG2017/3080)
DEPUTY PRESIDENT SAMS SYDNEY, 7 AUGUST 2018
Application for approval of an enterprise agreement – Sydney Harbour services – ferry and
marine tourism industries – protracted negotiations over two and a half years – last round of
negotiations with employees directly – consistent Union view that Ports, Harbours, Enclosed
Waters Award would otherwise apply to employees – NSW Government contract for
commuter ferry services – employer also engaged in marine tourism activities, such as whale
watching – related proceedings before four members of the Commission – all employees are
employed as casuals – narrow vote of employees to approve agreement after unsuccessful
votes – identity of employer – whether Notice of Employee Representational Rights (‘NERR’)
validly issued – whether employees ‘genuinely agreed’ to the Agreement – valid cohort of
employees who voted – whether employees eligible to vote or will be covered by the
Agreement – whether Agreement meets the Better Off Overall Test (‘BOOT’) – comparison to
correct Modern Award – no doubt as the identity of the employer – no issues as to whether
the Agreement was ‘genuinely agreed’ by the employees – long standing casual employees
who are regularly engaged – employees who voted were eligible to vote and would be
covered by the agreement – detailed BOOT comparisons with rosters and timesheets – further
undertakings proposed – agreement would pass the BOOT whether either the Ports Award or
the Marine Tourism Award was the reference instrument – some lesser benefits compared to
Ports Award outweighed on balance by benefits, including higher rates of pay and optional
permanent conversion – BOOT satisfied in respect to existing and future employees
(permanent full-time or part-time) – minor undertakings sought for clarity – views of
bargaining representatives to be sought before final approval of Agreement.
BACKGROUND
[1] This decision will determine an application filed by Noorton Pty Ltd t/a Manly Fast
Ferry (the ‘Company’ or ‘applicant’ or ‘Manly Fast Ferry’), pursuant to s 185 of the Fair
Work Act 2009 (the ‘Act’). The application seeks the approval from the Fair Work
Commission (the ‘Commission’) of an enterprise agreement agreed to by employees of the
applicant on 11 July 2017. The Agreement is titled Manly Fast Ferry – Sydney Harbour
Services – On-Board Crew – GPHs and Hosts – Enterprise Agreement 2017 (the
‘Agreement’). The application for approval of the Agreement was filed on 24 July 2017,
thereby satisfying the requirements of s 185(3)(a) of the Act.
[2018] FWC 4638[Note: This decision has been quashed - refer to Full
Bench decision dated 31 December 2018 [[2018] FWCFB 7224]
DECISION
E AUSTRALIA FairWork Commission
https://www.fwc.gov.au/documents/decisionssigned/html/2018fwcfb7224.htm
[2018] FWC 4638
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[2] It would be an understatement to describe the background to this application as
protracted and torturous. It has its origins in a decision of the New South Wales Government
in late 2008 to put to tender a contract for the high speed (Monday to Friday) commuter
service between Circular Quay and Manly. Manly Fast Ferry was the successful tenderer.
Prior to winning the contract the applicant only operated marine tourism services and at the
time two old Workplace Agreements were in place to cover the separate contracted ferry
services and the marine tourism/commercial vessel operations. The two agreements were
respectively:
Manly Fast Ferry & MUA – Sydney Harbour Ferry – Workplace Agreement 2009
(‘MFF Ferry Agreement’); and
Noorton Pty. Ltd. Commercial Vessels & Whale Watching – General Purpose Hands
– Workplace Agreement 2009 (‘Marine Tourism Agreement’)
Relevantly, although there were two separate agreements, employees would commonly work
under the MFF Ferry Agreement in the morning and afternoon peaks and then operate the
same vessel in the off peak, on marine tourism services, under the Marine Tourism
Agreement.
[3] During the initial contract period of 15 months, Manly Fast Ferry operated alongside
the State Government operated Sydney Harbour Ferries on the Circular Quay to Manly
service. Competition for these harbour ferry services became more intense from early 2010,
until the Government in 2014, decided to seek a long term contract for only two ferry
operators on the Circular Quay – Manly service, one of which would be the now privately
operated Harbour City Ferries. The other operator was Manly Fast Ferry, which won a seven
year contract commencing on 1 April 2015.
[4] The applicant decided to replace the old MFF Ferry Agreement with a new agreement,
intended, at the time, to only cover the ferry operations. Negotiations for the new agreement
commenced in April/May 2015 with the Maritime Union of Australia (the ‘Union’), despite
the amalgamation of the Union with the Construction, Forestry, Mining and Energy Union
and the Textile, Clothing and Footwear Union of Australia in March this year, I shall continue
to refer to the Union as the MUA. In cutting to the chase, negotiations have been ongoing for
[2018] FWC 4638
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over two years since that time until the filing of this application on 24 July 2017 – the
applicant’s fourth attempt at having an agreement approved. Throughout this period there
have been various related proceedings before at least three other members of the Commission
and two earlier votes of employees which resulted in iterations of the Agreement being lodged
in the Commission, but subsequently withdrawn by the applicant.
[5] Throughout this period the central dispute between the applicant and the Union has
been, and continues to be, what Modern Award should apply to the employees under a single
agreement covering both the ferry and tourism operations; namely:
the Ports, Harbours and Enclosed Water Vessels Award 2010 [MA000052] ‘(Ports
Award’); or
the Marine Tourism and Charter Vessels Award 2010 [MA000093] (‘Marine Tourism
Award’).
[6] Against the objections of the Union, the applicant put the proposed Agreement to a
secret ballot vote of 49 employees to be covered by the Agreement (all of whom are casual)
on 11 July 2017. By a narrow margin of 23 for and 21 against, the Agreement was approved.
The application for approval (F16) filed by Mr Richard Ford, Managing Director, identified
the applicant as Noorton Pty Ltd t/a Manly Fast Ferry.
[7] In the accompanying statutory declaration and ten annexures dealing mainly with the
pre-approval steps and indicative rosters (Form F17), Mr Ford identified the two Modern
Awards as the relevant reference instruments for the respective functions of ferry services and
marine tourism operations. Mr Ford set out a number of benefits and conditions in excess of,
or not provided for by the Modern Awards and a number of less beneficial terms. He attested
that the Agreement satisfied the Better Off Overall Test (BOOT) whether the test was applied
against the Ports Award or the Marine Tourism Award.
[8] In an F18, filed by Mr A Jacka on behalf of the Union, on 8 August 2017, the Union
did not support the approval of the Agreement for the following reasons:
(a) The Commission cannot be satisfied that the notice requirements, pursuant to s172(3)
of the Act have been met.
[2018] FWC 4638
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(b) The Commission cannot be satisfied, pursuant to s186(2)(a) and s188 of the Act that
the Agreement has been ‘genuinely agreed’ to by the employees covered by the
Agreement.
(c) The Commission cannot be satisfied that the group of employees to be covered by the
Agreement was ‘fairly chosen’ (s186(3)).
(d) The Commission cannot be satisfied, pursuant to s186(2)(d) of the Act that the
Agreement passes the Better Off Overall Test.
[9] Unsurprisingly, the Union disagreed with the employer’s F17 on the grounds that:
(a) the notification time was not 6 June 2017. There was no valid notification to
employees;
(b) the reference instrument is the Ports, Harbours and Enclosed Water Vessels Award
2010 only. The Marine Tourism and Charter Vessels Award 2010 does not cover the
employer or any of the employees covered by the Agreement; and
(c) the Agreement does not pass the Better Off Overall Test.
[10] By this time the application was under review by the Commission’s Enterprise
Agreement Triage Team and a report was prepared for the Panel Head, Deputy President
Gostencnik on 24 September 2017. A number of concerns were raised by the Deputy
President and communicated to the parties on 5 October 2017. The applicant provided certain
undertakings in respect to span of hours and the Union continued to press its objections (as
above). On 20 October 2017 the applicant’s solicitors, Holman Webb (Mr Stephen McCarthy)
provided a 22 page response to further concerns raised by the Triage Team and the Union. On
27 October 2017 the Union advised that it continued its opposition to the approval of the
Agreement and requested an arbitration of the matter. The application was then remitted to me
for hearing. On 7 November 2017, I issued directions for a hearing on 18 and 19 December
2017. However, due to the unavailability of key witnesses, the hearing by consent, was
relisted for 5 and 6 February 2018. In the meantime, the Commission, as presently
constituted, heard and determined an application filed by the Union, pursuant to s 483AA of
the Act, seeking orders for access to non-member records; see: The Maritime Union of
Australia [2017] FWC 6228. These proceedings related to a dispute filed by the Union in
which a determination was sought that only the Ports Award applied to the employees of the
[2018] FWC 4638
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applicant. This dispute remained unresolved, but ultimately was overtaken by the filing of this
application for approval of the Agreement.
[11] The hearing dates were further adjourned until 12 and 13 February 2018. Mr S
McCarthy, Solicitor appeared for the applicant and Ms L Doust of Counsel, with Mr Jacka
appeared for the Union. Both parties were granted permission to be represented by lawyers,
pursuant to s 596 of the Act. The hearing days were taken up with oral evidence and cross
examination of Mr Ford. Directions for the filing of final submissions were issued, but
extended, by consent, until the final submission was filed by the applicant on 17 April 2018.
THE EVIDENCE
[12] Evidence in this matter was provided by Mr Richard Ford, Director of Noorton Pty
Ltd and Manly Fast Ferry Pty Ltd and Mr Paul Garrett, Assistant Secretary of the Sydney
Branch of the Union, who was not required for cross examination. I observe that Mr Ford’s
evidence, although helpful and comprehensively referenced from source documents, was
more in the form of submissions, replete with opinions, assertions, and repetitive statements,
rather than evidence in proper form. I shall take that into account when considering Mr Ford’s
evidence.
Mr Richard Ford
[13] Mr Ford set out the history of the applicant’s operations and its winning of the seven
year ferry services contract for the NSW Government. In addition to the Circular Quay/Manly
commuter services, the business operates the following marine tourism and commercial vessel
services:
(a) Sydney Harbour Eco Hopper (around the Harbour sightseeing service, which includes
Taronga Zoo and Weekend Harbour Beaches services);
(b) Whale watching services;
(c) General charter vessel function services, catering for events such as weddings, social,
family & business functions, Sydney-Hobart Race Day, New Year’s Eve Harbour
cruises and the like; and
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(d) Manly to Sydney Aquarium/Darling Harbour service – although this service is treated
differently.
[14] Mr Ford outlined the steps he took to issue the first Notice of Employee
Representational Rights (NERR) to affected employees on 29 April 2015. Mr Ford made clear
that the proposed Agreement was to apply only to the newly contracted ferry services. Mr
Ford said that from the outset, the Union (acting as the ‘default’ bargaining representative)
adopted a hostile and challenging approach to the bargaining process across a number of
fronts simultaneously. Despite this, the applicant continued to meet with, and negotiated with
the Union and its delegates. Around June 2015, the applicant agreed to the Union’s proposal,
to replace the two old Workplace Agreements with a single agreement covering both the ferry
services business and the marine tourism operations. Mr Ford claimed the applicant agreed to
do so on the understanding that a final outcome would involve a ‘blended and averaged’
approach to rates of pay and conditions. This was necessary to ensure cost competitiveness for
its tourism and commercial operations. The applicant provided a summary of its proposal as
follows:
‘a. Combining Ferry & Tourist services rates & conditions
The new MFF Enterprise Agreement Offer will now cover both:-
i. MFF’s Sydney Harbour ferry operations; and
ii. MFF’s Sydney Harbour tourist services.
What does this mean?
By “blending together and averaging” the different:-
Wage rates; &
Penalty rates; &
Terms and conditions of employment;
That apply to MFF’s 2 separate areas of operation:
Ferries &
Tourism
MFF is now offering the employees one set of rates and conditions that will apply
when employees are at work for MFF – whether to a ferry run or a tourist run.
The “blending together” and “averaging” of the wage & penalty rates and conditions
must be done in such a way as to ensure that the Company can operate both its ferry
services as well as its marine tourist services without being priced out of the tourist
sector. MFF’s proposed amended Agreement seeks to do this.
[15] Mr Ford said this approach was maintained for the following two years of negotiations
with some 25 draft agreements, all of which reflected this approach. It is contained in Clause
5(c) and (d) of the Agreement now before the Commission for approval. It reads:
[2018] FWC 4638
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‘c. Significant Feature of the Terms & Conditions of the Agreement
A significant feature of this new Agreement is to establish a single code of
employment that is to cover both the Company’s Sydney Harbour public
passenger ferry service operations as well as the Company’s Sydney Harbour
commercial vessel/marine tourism services. Consequently, the rates of pay,
penalty rates and terms and conditions of employment reflect the need to blend
together and average the employment conditions standards that apply in the
two separate maritime industry sectors covered by this Agreement. The two
distinct maritime industry sectors are the “public passenger ferry services”
sector and the “commercial vessel/marine tourism” sector and the two
otherwise applicable Modern Awards that prescribe the two distinct minimum
employment standards in relation to the two industry sectors are:-
i. The Ports, Harbours and Enclosed Water Vessels Award 2010; and
ii. The Marine Tourism and Charter Vessels Award 2010.
d. The blending together and averaging of the rates of pay (in almost all cases)
and employment standards to establish a single code of employment under this
Agreement and the certainty that arises from the business’s ferry services
contract with the NSW Government will:-
i. Allow the Company to offer its longer serving GPH or Host/Hostess
casual employees the opportunity to convert from casual employment to
permanent employment after an employee has rendered 6 months of
service; and
ii. Allow all employees who may, on any day, perform work in both the
ferry services sector and the commercial vessel/marine tourism sector,
to receive a common blended and averaged rate of pay for work at any
particular time, with the exception of where an “Uplift Rate” may be
payable to Casual Employees at certain specified times for work on
ferry services;
iii. While at the same time ensuring that the Company can both operate its
ferry services as and when needed while still being able to afford to
compete in the commercial vessel/marine tourism sector and not be
priced out of the commercial vessel/marine tourism sector market.’
[16] Mr Ford believed the Union had initially supported this ‘blending and averaging’
approach as demonstrated by its proposed wage scales in August 2015, showing an ‘all in’
General Purpose Hand (‘GPH’)/Deckhand rate of $50,000 pa (the new Agreement rate is now
$53,547).
[17] Mr Ford maintained that if the rates and conditions of the Port Award were applied to
the applicant’s marine tourism and commercial operations, it would make that sector of the
[2018] FWC 4638
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business financially unviable. This might force a wind down or withdrawal from these
services. This would negatively impact on the number of employees and the available hours
for existing employees. Mr Ford believed that the Union’s insistence of the Port Award being
the only reference instrument for the purposes of the BOOT was contrary to its original
position and appeared to have changed following dispute proceedings before Deputy
President Dean in October 2016 (Matter B2015/1113).
[18] For the following reasons, Mr Ford said it was the applicant’s view that the two
Modern Awards are the relevant reference instruments in respect to the application of the
BOOT:
a. At present the applicant’s two distinct areas of business activities operate in two
different cost competitive business markets.
b. This has been the case since the commencement of the business’s ferry services in
early 2009.
c. The two separate and distinct and still currently operating old Workplace
Agreements (the ‘Old’ Agreements) reflect and support the applicant’s two
separate and distinct business cost structures.
d. The other party to the Agreement – the employees – recognise and accept the
reality of the need for this distinction and separation of the two parts of the
business.
Mr Ford claimed there was no impediment under the Act for the Commission to consider the
‘unusual’ approach of applying two awards for the purposes of the BOOT, given the unique
environment the applicant operates in. It reflects the realities of the business and the intention
of the applicant and the employees who are parties to the Agreement. He believed that the
new Agreement will result in employees being ‘better off overall’.
[19] Mr Ford returned to the more recent negotiations for the Agreement. In rejecting the
applicant’s latest settlement offer on 29 May 2017, the Union (Mr Garrett) declared ‘that
bargaining was concluded’. As a result the applicant issued a new NERR to relevant
employees on 6 June 2017, as the earlier NERR was defective. Mr Ford added that
notwithstanding the Union’s position, the applicant proposed a revised ‘best and final offer’ in
a letter to the Union on 9 June 2017. It read in part:
[2018] FWC 4638
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‘It must be said however it is simply not possible to reconcile the MUA’s insistence
that the business’s Hopper services must be regarded as a ferry service with the
reality that to accept the MUA’s position would both make the cost of operating the
Hopper service untenable as well as be contrary to the fact that the Hopper service is
designed to function as a marine tourism product and not a ferry service.
Nonetheless, MFF does want to finalise these long drawn out EBA negotiations and
reach a long overdue completion. With that in mind MFF would like to make one final
endeavour to finalise the EBA negotiations by putting forward a “best and final”
Offer.’
[20] The Union was advised on 14 June 2017 of a proposed new Agreement which include
the following:
1. The higher Casual Rate of $29.50/hour.
2. The consequential higher Casual Aggregated Weekend Rate of $34.50/hour.
3. The higher Uplift Rates for GPH’s on Ferry runs of:
a. $45.00/hour on Sundays between Manly and Circular Quay;
b. $31.50/hour After 6:00pm Monday to Friday; and
c. $56.20/hour on Public Holidays between Manly and Circular Quay.
The Union did not reply to this letter and instead, lodged a dispute application on 16 June
2017, which was listed for conference before me on 29 June 2017 (matter C2017/3255). Mr
Ford understood the Union through its dispute notification, had requested the Commission to
determine the appropriate award coverage for the employees.
[21] Mr Ford stated that the Union responded to the applicant on 19 June 2017 by now
asserting underpayment of wages and claiming the Company was ‘bullying workers into
accepting inferior conditions’. Mr Ford considered this was an attempt to ‘mix and confuse’
two separate issues – the bargaining process with allegations of underpayment of wages.
[22] Mr Ford included comparison tables for the new Agreement and the two Modern
Awards and indicative rosters, noting that all present employees are casual employees. Mr
Ford contended that the tables demonstrate that:
(a) in every instance the Casual rates prescribed by the new Agreement are higher than
the comparable rates prescribed for Casual employees by either of the two Modern
Awards;
(b) in relation to future employment of Permanent employees, the Table shows the
new Agreement’s ordinary rates, overtime rates and penalty rates are higher than
[2018] FWC 4638
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the comparable rates prescribed for Permanent employees by either of the two
Modern Awards, other than in four circumstances. The four circumstances are:
Ports & Harbours etc. Award
1. Permanent employees ordinary hours rate on a Saturday;
2. Permanent employees ordinary hours rate on a Sunday; and
3. Permanent employees overtime rate on a Sunday.
Marine Tourism etc. Award
4. Permanent Saturday Overtime rate after three hours of overtime.
(c) In relation to the above four instances where the Agreement rates are below the
comparative Modem Award rates, I would observe that when the two Modern
Awards rates are “blended and averaged”, there is then only one circumstance
where the Agreement’s rates are not higher than the averaged two Award rates, and
that is in the circumstance of permanent employees working ordinary hours rate on
a Sunday.
[23] All of this material was provided to the Union and in various proceedings before
Commissioner Cambridge, Vice President Watson and Deputy President Dean. Mr Ford
asserted that in every instance under an indicative four week roster, every employee, whether
Casual, Part-Time or Full-Time employees, will be ‘better off’ under the Agreement.
[24] Mr Ford said that the only criticism the Union had ever made of the calculations was
that the only work considered ‘marine tourism’ was ‘whale watching’; a position consistently
rejected by the applicant. Nevertheless, for present purposes, Mr Ford applied the Union’s
approach and again in every case, employees will be ‘better off overall’. Increases flowing
from the Agreement (1 December 2017) will continue to ensure employees are ‘better off
overall’.
[25] Mr Ford reiterated that, with one exception (a small number of Host/Hostess
employees who are exclusively in marine tourism) the applicant operates the same vessels
with the same crews in two different industries. The vast bulk of the employees are classified
as General Purpose Hands (GPHs).
[26] Mr Ford noted that under the relevant State legislation (Passenger Transport Act
2014) the only ferry service conducted by the business is the contracted Circular Quay/Manly
service. None of the other services conducted by the applicant are ‘technically’ ferry services.
It is not correct, as the Union contends, that any ‘timetabled service is effectively a ferry
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service’. This has been explained to the Union on many occasions. Support for the applicant’s
position arises from other legislative sources (Certificates issued under the Marine Safety
(Domestic Commercial Vessel) National Law Act 2012 (Cth) and Marine Orders 503 and 504
(Cth)). The effect of the certificates is demonstrated by its vessel, Ocean Dreaming II as
follows:
When Ocean Dreaming II is operating as a passenger ferry the vessel is restricted to:-
1. A maximum of 23 passengers on the Sundeck
2. A maximum of 92 passengers. on the Upper Deck; and
3. No passengers are allowed on the Fore Deck.
However, when Ocean Dreaming II is operating as a marine tourism/charter vessel,
the passenger restrictions increase to become:-
1. A maximum of 55 passengers on the Sundeck
2. A maximum of 110 passengers on the Upper Deck; and
3. A maximum of 37 passengers on the Fore Deck.
[27] Mr Ford referred to the applicant’s principal market competitors which all employ
employees under the Marine Tourism Award, and not the Ports Award. They are:
a. Matilda Cruises/ Captain Cook Cruises/SeaLink;
b. Fantasea Cruises; and
c. Rosman Ferries.
[28] Mr Ford observed that although the Circular Quay to Darling Harbour service is not
gazetted as a ‘ferry service’ under the State Act, the applicant offered a concession to the
Union to treat it as a ‘ferry service’. This is reflected in the coverage clause and the
Agreement (Cl 5).
[29] Mr Ford’s evidence dealt with the applicant’s responses and undertakings offered to
the Commission after requests for further particulars from DP Gostencnik. Mr Ford stressed
that no employee performs exclusively ferry work and that the Ports Award is not the only
Award to be considered for the purposes of the BOOT.
[30] Mr Ford made particular reference to cl 12(g) and stated that this sub clause was not a
‘make good’ provision to ensure BOOT compliance, because the Agreement already meets
the BOOT. It is just a means by which an employee can check that the Agreement rates are
being paid correctly. Mr Ford also addressed the Union’s claim that the permanent part-time
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provisions do not match the corresponding provisions in the Ports Award. Mr Ford said
firstly, that the Union ignores the part-time provisions in the Marine Tourism Award and in
any event, the Agreement’s part-time provisions more than satisfy the BOOT in that they
provide:
(a) a minimum of 4 ordinary hours work on any day;
(b) a maximum of 11 ordinary hours on a day;
(c) a guaranteed minimum of ordinary hours for a Part Time Employee of 40% of a
full time employees 38 ordinary hours over a 4 week roster cycle i.e. a minimum
of 64 ordinary hours per 4 weeks or an average of a minimum of 16 ordinary hours
each week;
(d) the right of an employee to seek an increase in their minimum percentage
arrangements where their current minimum% is exceeded for 6 months or more;
(e) the protection that an employee's guaranteed minimum % can only be reduced with
the employee's agreement;
(f) that each extra hour worked is paid for at the ‘Hourly equivalent Salary Rate’
prescribed by the Agreement, except for additional hours worked that are in excess
of:
11 hours on any day;
48 hours in a week;
96 hours In a fortnight;
52 hours in a 4 week pay calculation period;
in which case the extra hours would be paid for at the rate of 1% for the first two
hours and then double time thereafter at the ‘Hourly equivalent Salary Rate’
prescribed by the Agreement.
[31] Mr Ford described as disappointing, the Union’s rejection of these conditions, given
the flexibility welcomed by employees and the many months of negotiations on the issue.
Specifically, Mr Ford rejected the Union’s claims that the Agreement does not:
(a) provide a minimum of three hours for casual employees. In fact, the Agreement
provides a four hour minimum.
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(b) prescribe rates for Ticket Sellers, because the Agreement does not cover Ticket
Sellers.
(c) provide for a Span of Hours. This is now covered by the applicant’s undertaking; see:
para 153(i) following. Mr Ford expressly rejected the Unions claim as the span of
hours being only those applying under the Ports Award.
(d) provide for $1796 compensation for loss of personal effects. The rate proposed is
$1698 which is $533 above the amount in the Marine Tourism Award.
(e) provide for a Bilge Allowance. This allowance is not found in the Marine Tourism
Award and no employees would be expected to work in the ships bilge. If such work
was required the provision of the Ports Award would apply by virtue of cl 14.12.
(f) provide an Expense Allowance. No reimbursement is found in the Marine Tourism
Award. However, there would be no circumstance where an employee incurring a
work related expense would not be reimbursed. An undertaking can be offered if the
Commission considers it necessary.
(g) provide a First Aid allowance. No employee is required to be qualified in first aid.
(h) contain a Meal Allowance. These allowances are expressly included in the rates of pay
which prescribes:
The Annual Salaries prescribed in Schedule 1 have been set to take into
account and to cover the following provisions of this Agreement:-
6. All otherwise applicable allowances, except for the allowances and the
other additional payments prescribed by Clause 26. Travel & Call Back
“Out of Hours”.
(i) contain a ships stranded or wrecked or on fire allowance. The allowance in the Ports
Award relate to ships wrecked or stranded during a voyage. This does not relate to the
work of the applicant’s employees.
(j) contain a provision regarding the transport of employees. This is incorrect as cl 14.22
of the Agreement sets out the costs paid by the employer or transport provided by the
employer. The clause also provides for an additional 15 minutes pay and a $10 travel
expense when an employee starts or finishes at a different location on the same shift.
(k) In addition, the applicant will provide an undertaking to only pay wages weekly or
fortnightly.
Mr Paul Garrett
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[32] Mr Garrett has responsibility for representing the industrial interests of members of the
Union. He has extensive experience and practical knowledge of the maritime industry and is
familiar with the history and operation of both Modern Awards. Mr Garrett has extensive
experience in dealing with safety, industrial, government and regulatory issues affecting
maritime workers operating in, or around Sydney Harbour, and he negotiated the 2004, 2006,
2012, 2014 and 2016 Agreements covering agencies and companies operating Sydney Ferries.
[33] On behalf of the Union, Mr Garrett opposed the application to approve the Agreement.
He was concerned that the Agreement does not comply with the statutory requirements under
the Act, and undercuts the entitlements of employees when compared to the Ports Award. He
was particularly concerned that it is now suggested that Noorton Pty Ltd is the employer of
the employees, despite his dealings with Manly Fast Ferry Pty Ltd over recent times. At the
time, Mr Garrett took the view, despite the applicant applying one rate for services between
Circular Quay and Manly and a different rate for off peak services, they were all ferry
services, covered by the Ports Award.
[34] Mr Garrett included in his evidence the three NERRs issued by the applicant on 29
April 2015, 14 September 2015 and 26 April 2016. Mr Garrett said that on 19 December 2016
when a proposed agreement was submitted for approval by the Commission (Manly Fast
Ferry Pty Ltd – Sydney Harbour Services – On Board Crew – GPHs and Hosts Enterprise
Agreement 2016) Mr Ford swore a statutory declaration attesting to Manly Fast Ferry Pty Ltd
as the true employer of the employees. Mr Garrett had understood this to be the case because
the applicant had a contract with the NSW Government to deliver fast ferry services between
Circular Quay and Manly. Mr Garrett’s own research disclosed that as at 19 June 2017,
Noorton Pty Ltd was not registered as trading under the name of Manly Fast Ferry. This
approval application was discontinued by the applicant on 13 February 2017.
[35] Mr Garrett said that on 23 February 2017 Manly Fast Ferry issued another NERR to
employees for a proposed agreement in respect to employees that are employed by Manly
Fast Ferry as either a:
- General Purpose Hand (GPH);
- Host/Hostess;
- Junior General Purpose Hand (GPH); or a
- Junior Host/Hostess;
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on the Company’s vessels in relation to the Company’s maritime tourism services on
or about or out of Sydney Harbour and/or ferry service operations on or about Sydney
Harbour.
[36] When Mr Garrett wrote to the applicant in 2017 concerning underpayments to
employees, at no time was it said by the applicant or its solicitor, that the Company was
Noorton Pty Ltd. A further NERR was issued by Noorton Pty Ltd on 6 June 2017 which Mr
Garrett was not made aware of at the time. Three days later, Mr McCarthy sent a ‘best and
final’ offer for the Manly Fast Ferry P/L – Sydney Harbour Services – On Board Crew –
GPHs & Hosts Enterprise Agreement 2017. It was not the name used in the NERR of 6 June
2017. A subsequent email on 14 June 2017 from Mr McCarthy, identified Noorton Pty Ltd as
the employer party to the Agreement. This prompted Mr Garrett to file a dispute application
with the Commission concerning:
which modern Award currently applied to employees;
which enterprise agreement currently applied to employees;
a breach of the Ports Award for alleged underpayment of wages; and
who the employer was.
Mr Garrett claimed the above circumstances were baffling, and he was sceptical, because
Noorton had been named as the employer of whale watching operations (marine tourism). A
check of the ABNs on the employees’ pay slips did not shed any light on which Company
was the true employer.
[37] When the applicant put the Agreement to a vote, the employer was identified as
Noorton Pty Ltd t/a Manly Fast Ferry. Mr Garrett made requests for further information,
raised concerns about the access period and sought to have the vote of employees deferred. In
the dispute notification response of 28 June 2017, the applicant continued to assert Noorton
Pty Ltd as the employer. However, the vote scheduled for 29 June 2017 was cancelled.
[38] Mr Garrett referred to relevant applicable maritime legislation as to the definition of a
‘ferry’. The NSW Marine Safety Regulation 2016 states:
ferry and ferry service have the same meaning as in the Passenger Transport Act
2014.
[2018] FWC 4638
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Note.
The Passenger Transport Act 2014 defines ferry as a vessel which seats more than 8
adult persons, and includes a vessel of any class prescribed by the regulations under
that Act for the purposes of that definition.
Mr Garrett said that all vessels operated by the applicant seat more than 8 adult persons.
[39] Mr Garrett observed that all of the applicant’s Sydney Harbour services operate
according to a timetable. He set out each of the following services and their timetables as at
14 June 2018:
(a) Manly – Circular Quay
(b) Manly – Darling Harbour
(c) Manly – North Sydney
(d) Manly – Pyrmont Bay
(e) Manly – Watsons Bay
(f) Harbour Beaches Ferry
(g) Eco Hopper
(h) Whale Watching (Mr Garrett agreed that whale watching is seasonal, but it is still
timetabled between May and December).
[40] It was Mr Garrett’s evidence that the applicant has a high and regular turnover of
employees. He estimated that in a period of two years there has been some 200 additional
employees. Mr Garrett claimed the applicant hired a number of new casual staff immediately
prior to the Agreement vote. He did not expect they would continue to be employed or be
covered by the Agreement. Further, he was concerned that some of the employees may not
have been entitled to vote, if they were employees of Manly Fast Ferry, and not Noorton.
[41] Mr Garrett responded to Mr Ford’s statement as follows:
(a) Mr Ford regularly voiced his concerns as to the correct Award to be applied, as
it was apparent that he had costed his business on the basis that the Marine
Tourism Award applied to all, or most of the work. Mr Garrett said he would
[2018] FWC 4638
17
not have agreed to any arrangement which may have disadvantaged employees
as to their rightful Award entitlements.
(b) Mr Ford was ‘cherry picking’ the lowest conditions from each of the Awards
to be included in an Agreement. He gave an example of Juniors being included
when there is no provision for Juniors in the Ports Award.
(c) Mr Garrett disagreed that the application for approval of the then Agreement
was withdrawn in December 2016 because of the ‘opposition, objection and
pressure’ from the Union. It was because the NERR was non-compliant.
(d) Mr Garrett had regularly challenged the accuracy of the tables and rosters
provided by the applicant. He maintained that 90% of the work is ferry work.
[42] In a reply statement, Mr Ford said that the Union had been aware for years that
Noorton Pty Ltd is the employer. For example in dispute proceedings in matter C2017/3255
this was made clear in documents (payslips) provided to the Commission in 2017, for a
number of employees for the period between May – July 2017. The Union even accepted
Noorton was the employer when it first issued an NERR in April 2015. Nevertheless, the
business is generally known as Manly Fast Ferry.
[43] Mr Ford explained the business strategy which originally began with establishing a
new agreement between employees and Noorton Pty Ltd. It became an agreement between
employees and the related entity of Manly Fast Ferry for ferry and marine tourism work.
Manly Fast Ferry then returned to the original intention of an agreement between employees
and Noorton Pty Ltd as a result of ‘commercially confidential’ matters, coinciding with the
final stages of the Agreement negotiations in June/July 2017. It resulted in a decision to retain
the structure of having Noorton as the employer of all employees. This is why the NERR
issued on 6 June 2017 was issued by Noorton Pty Ltd.
[44] Mr Ford denied that Noorton Pty Ltd had done nothing to initiate bargaining before it
issued the 6 June 2017 NERR. He said that after Mr Garrett had declared bargaining at an
end, he communicated directly with the employees for the purpose of negotiating and
finalising an agreement. These communications included SMS text messages to employee
[2018] FWC 4638
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representatives, Beau Chippindale and Nicola Spata. On 2 June 2017, the applicant sought
legal advice as to the way forward. This resulted in the NERR of 6 June 2017.
[45] Mr Ford responded to criticism that the applicant had not demonstrated how the
employees who were to vote, were selected. Noorton Pty Ltd uses a roster system called
easyEMPLOYER to manage the roster and prepare timesheets for payroll processing. The
system categorises employees according to classifications GPH, Hosts, Sales, Master etc.
[46] Mr Ford had downloaded the list of current GPH and Host employees on the
easyEMPLOYER system at the time the invitation to vote was distributed. He said that if the
Commission required further details, the applicant would be willing to do so, subject to the
employees’ names being kept confidential.
[47] Mr Ford rejected the allegation that there had been a substantial turnover of labour. At
the time of the vote 31% of the employees had been engaged for over two years and a number
of other former GPH employees had been promoted to Master positions.
[48] Mr Ford set out the Company structure as follows:
The business ferry services, which include:-
a. Manly to Circular Quay; and
b. Manly to Sydney Aquarium/Darling Harbour service
are the business activities operated by Manly Fast Ferry Pty Ltd.
The businesses tourist activities, which include:
a. Sydney Harbour Eco Hopper (around the Harbour sightseeing) service;
b. Taronga Zoo & Weekend Harbour Beaches services; and
c. whale watching;
are the businesses operated by Noorton Pty Ltd.
This structural separation in the business reflect operations reflects the fact that Manly
Fast Ferry Pty Ltd both:
a. Holds the ferry services contract with the NSW Government/Transport for
NSW (TfNSW) which allows it to operate a commuter ferry service between
Manly and Circular Quay; and
b. Has been granted an exemption by TfNSW to operate a commuter ferry service
between Manly and Darling Harbour under the Passenger Transport
Regulations 2007 (NSW). The exemption exempts MFF P/L from the statutory
[2018] FWC 4638
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requirement under the Passenger Transport Act (NSW) to hold a service
contract with NSW Government/TforNSW in order to operate a commuter
ferry service.
Noorton Pty Ltd is, and has been at all material times, the only employer of the
employees:-
a. working on the business vessels while they perform all of the abovementioned
services; and
b. who are covered by the new Agreement.
Manly Fast Ferry Pty. Ltd. is wholly owned by Noorton Pty. Ltd.
Manly Fast Ferry Pty. Ltd. has no employees. In this regard I would further note that
Manly Fast Ferry Pty. Ltd. is not, and has not been for many years, registered with the
ATO for PAYG tax purposes.
[49] Mr Ford claimed that communications from the applicant in June 2017 which may
have referenced Manly Fast Ferry were ‘typographical errors’. This fact was as reflected in
the new Agreement naming Noorton Pty Ltd as the employer and Mr Garrett acknowledged
as much. The earlier dispute application in which Manly Fast Ferry had filed a response, was
because the Union had filed the application against Manly Fast Ferry. In any event, Mr
Garrett had conceded Noorton was the employer.
[50] Mr Ford rejected Mr Garrett’s misrepresentation of the definition in the Passenger
Transport Act 2014 (NSW) as he failed to mention:
Section 4 Definitions, goes on to define “ferry service” to mean “a public
passenger service provided by means of a ferry”.
Section 5 Public Passenger Services, then sets out a detailed definition on the
meaning of public passenger service.
Section 39(1) of the Act (significantly) is in the following terms:
“(1) A person must not operate a public passenger service that is conducted
according to regular routes and timetables or according to regular routes and
at regular intervals otherwise than under the authority of a passenger service
contract.”; and
Section 39(2) of the [Passenger Transport Act 2014 (NSW)] provides that
Section 39 does not apply to a “tourist service”.
[2018] FWC 4638
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[51] Mr Ford regretted the Union’s claim that the tables and Award comparisons were
inaccurate; particularly after many hours of preparation and presentation during the
negotiations and in proceedings before three different Commission members.
[52] Mr Ford believed the Union’s issue is not about the accuracy of the calculations, but
reflects the Union’s claims that it wanted larger wage increases and a greater proportion of
ferry work compared to marine tourism work. Moreover, Mr Ford believed that on several
occasions, the Union had indicated the parties were close to agreement, but no final
agreement was achieved. Mr Ford acknowledged that the calculations were based on
‘indicative rosters’ because they include future Part-Time and Full-Time comparisons in
circumstances in which the applicant only presently engages Casuals. This is because the
applicant has agreed to a new approach to move employees to more permanent employment,
if they choose to do so. These rosters were provided to Deputy President Dean on 29
September 2016 and further roster comparisons, showing start and finish times was provided
to the Union, at their request, on 18 January 2018. Mr Ford made clear that employees are still
‘better off overall’ under the rates of pay in the new Agreement, even if the Union’s position
is accepted i.e. that all work is regarded as ferry work, except ‘whale watching’.
Cross examination of Mr Ford
[53] Mr Ford conceded that he was incorrect in his statements when he said there had been
four votes of employees. He explained there were two actual votes and two other occasions,
where the vote was notified, but later cancelled.
[54] Mr Ford agreed he commenced as a Director and Company Secretary on 19 July 1995.
The Company was established at his instigation. As a result of a recent transaction, he no
longer has any shares in Noorton Pty Ltd. His transfer of shares was to NRMA Marine Pty
Ltd (NRMA Marine) which is now the major shareholder in the Company. He remains
General Manager of Noorton, as an employee of NRMA Marine and reports to the Board,
which has established a company known as Manly Fast Ferry. He said he did not include this
development in his second statement, because he understood the Commission was only
concerned with the circumstances leading up to, and the date of the vote in July 2017.
[2018] FWC 4638
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[55] Mr Ford is responsible for industrial relations for the applicant. He could not be sure,
without checking, whether he remained a director of Noorton Pty Ltd or Manly Fast Ferry. Mr
Ford accepted that, at one point, Noorton Pty Ltd held all the shares in Manly Fast Ferry Pty
Ltd, but he could not be sure of the new structure, now NRMA Marine is involved.
[56] Mr Ford confirmed that during the period from April 2015 to July 2017 he was in
charge of managing the applicant with his brother. He is the person most across Manly Fast
Ferry’s industrial and employment affairs. He understood that Transport NSW had agreed for
the assignment by Manly Fast Ferry of the long term ferry service contract to NRMA Marine.
Manly Fast Ferry also has certain regulatory provisions in respect to Darling Harbour and
Milsons Point ferry services.
[57] Mr Ford said that in respect to the applicant’s vessels Seacat I and Seacat 2, only one
of them is in operation at the present time. Mr Ford claimed he could not source the survey
certificate for Seacat I in the time ordered under a Notice to Produce. He could continue to
make inquiries and find the survey certificate and produce it. He had previously not provided
the survey certificate for the vessel ‘Totally Wild’, because it is not covered by the
Agreement. It has no GPHs or hosts on board.
[58] Mr Ford was asked about the lists of employees who voted in the ballot for the
Agreement’s approval. He claimed the way the applicant rosters employees to perform shifts
is ‘commercially confidential’. Nevertheless, he agreed the rosters contain shifts that would
not be covered by the Agreement.
[59] Ms Doust pressed Mr Ford on the legal basis on which he had signed the Agreement.
Mr Ford asserted that the legal name of the employer was Noorton Pty Ltd, but people refer
to, and associate it as Manly Fast Ferry. The employees say they work for Manly Fast Ferry,
but their payslips, group certificates and rosters come from Noorton Pty Ltd. Mr Ford
accepted that when he attested to the F17 he had indicated that Many Fast Ferry was the name
the Company traded under. Mr Ford was unaware that a business trading under a business
name, must have the business name registered. Mr Ford added that Manly Fast Ferry Pty Ltd
is wholly owned by Noorton Pty Ltd. However, he conceded Manly Fast Ferry is not
registered as the trading name. Mr Ford explained that Noorton Pty Ltd derives revenue from
tourism services and Manly Fast Ferry earns revenue from the ferry services. Mr Ford was
[2018] FWC 4638
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shown various references in documents, including an earlier draft agreement and emails,
purporting to show Noorton Pty Ltd, trading under the name of Manly Fast Ferry. A letter to
employees of 19 June 2017 advising, inter alia, of the ‘access period’ for the new Agreement
and the NERR, were issued as being on behalf of Noorton Pty Ltd t/a Manly Fast Ferry. In
this exchange with Ms Doust, Mr Ford said:
… I'm saying I put them in there because our employees understand the name of the
agreement is ‘Manly Fast Ferry’, so the consistent reference to Manly Fast Ferry with
Noorton Pty Ltd being the employer has them understand what we're talking about
because it is a Manly Fast Ferry agreement for Sydney Harbour Services, on-board
crew, GPH and hosts enterprise agreement. ‘Noorton Pty Ltd’ is the employer.
"Manly Fast Ferry" is the agreement.
(Transcript, PN375)
[60] Mr Ford accepted that Noorton does not trade as Manly Fast Ferry, but he maintained
that to the employees the agreement is (with) Manly Fast Ferry. Mr Ford insisted that in May
2017 there was no link to the sale of the business to a change of respondency to an enterprise
agreement.
[61] It was Mr Ford’s evidence that he was not aware of any document, in the possession of
Noorton, which records the agreement of employees to accept employment. Mr Ford agreed
he had responsibility for industrial matters, with advice from Mr McCarthy. He had issued the
NERR in April 2015 to employees working on the Circular Quay to Manly Ferry service. He
accepted it was an important part of the process to ensure the employer was correctly
identified. The employer at that time (April – September 2015), was Noorton Pty Ltd, as
Manly Fast Ferry had no employees. He explained the business strategy at the time:
‘Well, initially we proposed to the MUA an agreement which covered the GPHs and
hosts working on the ferry service between Manly and Circular Quay. The feedback
from the employees and the MUA was that the desire was to have one agreement that
covered both the tourism work and the ferry work operated by the two separate
entities, and so then it was – prior to April 2015 we had two workplace agreements,
one was under the name of "Manly Fast Ferry" and one was under the name of
Noorton Pty Ltd. So once the company agreed with the MUA's request and the staff's
request to put them under one entity – one agreement, the decision was made by the
company that we should employ under Manly Fast Ferry so that the one agreement
and all employees would be covered under the one company, and that was our
intention after the initial negotiations.’
(Transcript, PN430)
[2018] FWC 4638
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[62] This proposal was not implemented. However, Mr Ford understood that once the
Agreement was in place the applicant could transfer employees to another Company,
providing the employees’ existing rights and entitlements were maintained. He believed that
could happen now. The employees were not asked about this at the time (July/August 2015)
because the proposition did not proceed. Mr Ford said that around 14 September 2015
employees of Noorton received an NERR, although that notice stated Manly Fast Ferry was
the employer and bargaining with them would be ‘the arrangement going forward’. It wasn’t
until May 2017 that Mr McCarthy explained that the NERR had to be reissued under the
name of Noorton Pty Ltd. There had been a communication breakdown as to timing of when
the transfer would occur. No steps were taken between September 2015 and 26 April 2016 to
implement the decision and no consultation was had with employees about transferring them
to a different entity. It did not happen.
[63] Mr Ford insisted Noorton was, and always has been the employer of the employees.
Noorton remained the employer when the 26 April 2016 NERR was issued to GPH and Hosts
engaged in marine tourism activities. Despite the NERR detailing Manly Fast Ferry as the
employer, it was still the intention, at this point, to move in that direction. The same applied
to another NERR issued on 20 May 2016. Mr Ford agreed that all of the documents issued to
employees around 25 November 2016, maintain that Manly Fast Ferry was the employer. Mr
Ford acknowledged that in the documents provided to the Commission, all information must
be truthful. In any event, the application at that time was discontinued.
[64] Mr Ford conceded that a new NERR issued on 23 February 2017 continued reference
to Manly Fast Ferry as the employer. From this time until June 2017, the Union continued to
bargain, but had not asked to bargain with Noorton.
[65] In respect to the negotiations with Mr Beau Chippendale, Mr Ford agreed he was a
Master at the time of the vote for the Agreement and did not vote. He was however a
Deckhand throughout the two and a half years of negotiations. Ms Nicole Spata works in the
Darling Harbour office and on the vessels at times as a GPH. She also manages the rosters.
Neither Mr Chippendale nor Ms Spata were nominated as employee bargaining
representatives. Mr Ford agreed that in his emails to them he continued to refer to Manly Fast
Ferry as the employer. Mr Ford did not accept this was a significant issue for employees.
[2018] FWC 4638
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They all knew what was meant. He said he was told the legal name of the employer was
irrelevant to them and they just wanted an agreement in place.
[66] Questioning then turned to the voting list of employees. Mr Ford had prepared the list
from downloaded electronic files. The NERR was issued on 6 June 2017. He informed
Mr McCarthy on 19 June 2017 that new employees were being ‘added all the time’ and he
wanted to make sure he captured all eligible employees to vote. He denied this was a
reference to new employees added between 6 and 19 June 2017.
[67] Mr Ford was shown a list of 49 names in answer to a Notice to Produce. The
document recorded who voted and who did not vote on 11 July 2017. Mr Ford had utilised the
rosters to establish if employees worked a shift before, or after the vote, the date employees
commenced employment and their last login date. He said the first four columns of the
document were downloaded from a company, Simply Voting, and the second four columns
were transcribed by him from the applicant’s records.
[68] Mr Ford was then asked to compare the voting lists with the actual rosters of
employees. In respect to:
Employee A:
- Days worked before vote - 22 and 23 June;
- After vote – 20 and 21 July
- Not at work on day of vote.
Employee B:
- Worked up until 2 June
- No annual leave up to and including the vote (5 weeks)
- intended to be reemployed.
Employee C:
- Worked some hours on 26 May 2017
- No further work until 7 October 2017 (four and a half months)
Employee D:
- Sales duties 13 – 15 July
- Raratonga whale research 19 July, 23 July plus
- employed since 2009.
- no indication he was performing deckhand duties after the vote.
- last login 4 February 2018.
Employee E:
[2018] FWC 4638
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- last shift before vote - 10 June
- worked 10 – 12 July
- asks for annual leave to be paid out on 12 July
- unknown if he left
- traineeship.
Employee F:
- Worked for the majority of shifts as a coxswain or Master in the week prior to the
vote.
Employee G:
- sales employee in the office at Darling Harbour, 8am to 4:30pm shifts.
- not working as a deckhand in sample roster, but has worked as a host.
Employee H:
- wharf hand performing deckhand work on 2 July and for the week up to the vote.
Employee I
- for the full roster period the employee is on unpaid leave in the United Kingdom.
There is no record of the employee being at work prior to the vote. June payslips
show the employee worked 16.5 hours as a deckhand, Darling Harbour service 5
hours, Hopper 23 hours.
[69] Mr Ford agreed that Wharf Hands are not covered by the Agreement, but by the old
Noorton Workplace Agreement 2009.
[70] Mr Ford said employees move across Sales, Wharf Hand, Deckhand and Host roles
depending on the Company’s requirements for a particular shift or vessel. In response to
questions from me, Mr Ford said that the old Workplace Agreement will continue to apply to
employees working on the wharf, until that Agreement is replaced. The employees who move
across from the wharf to a vessel will remain covered by two agreements for the foreseeable
future.
[71] In further evidence, Mr Ford said he had no access to, and cannot provide any material
to identify how an employee voted. The vote was undertaken by an independent company
which had been sourced, because it had been used for other agreement votes.
[72] Mr Ford was referred to the service timetable covered by the Manly Fast Ferry
contract. He agreed there were changes to the timetable between June 2017 and June 2018.
Services were added on weekdays and weekends and wharf departures were changed.
Mr Ford said both the ferry services and the tourist services have increased since the vote. Mr
[2018] FWC 4638
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Ford said most of the vessels can operate on any route and are subject to change based on
timetabling or maintenance requirements. The time sheets will not show this. However, the
employee’s payslips show which vessel he/she worked on. Services such as Manly/Darling
Harbour or Manly/North Sydney and Manly/Watsons Bay are designated ‘hopper’ services on
the timesheets. Mr Ford added that there are additional services added in summer, such as the
Harbour Beaches Ferry which does not operate on weekdays. When shown the published
timetables on the website annexed to Mr Garrett’s statement, Mr Ford agreed that timetabling
for ferry services also includes tourist services (hop on/hop off services) and loop services.
Whale watching cruises run from May to December. Five vessels can be used, but GPHs do
not work on the vessel ‘Totally Wild’. Mr Ford said the most accurate records of the work
performed is the timesheets, as rosters might change due to the unavailability of a particular
vessel.
[73] Mr Ford was asked about the Certificates of Survey of all the applicant’s vessels. The
following are passenger ferries:
Seacat I and Seacat II (not used on Manly Fast Ferry services)
Arafura Pearl
Ocean Rider (Operates Manly Fast Ferry)
Ocean Trader and Ocean Wave (Operates Manly Fast Ferry and Hopper and Whale
Watching)
Ocean Flyer and Ocean Surfer (Operates Manly Fast Ferry, but due to size not used
on Hopper service).
[74] Mr Ford agreed that some employees work after 6:00 pm, particularly during summer
and some employees work on Sundays and Public Holidays (e.g. Harbour Beach Ferries).
Schedule 2 of the Agreement provides for an ‘uplift’ for afternoon/evening work and
Sunday/Public Holiday work, but only to the Circular Quay/Manly and Manly/Darling
Harbour Services. This is because these are the only services the Company designates as ferry
services.
[75] Mr Ford believed the number of employees since the vote (49) may be 10% higher or
lower than 49. Mr Ford claimed that while a number of employees have expressed interest in
[2018] FWC 4638
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becoming permanent, the majority, particularly the longer term employees, who secure most
of the weekend casual shifts, would prefer to remain as Casuals.
[76] In respect to Mr Ford’s conclusion that employees will be ‘better off overall’
irrespective of which Modern Award is the reference instrument, he was asked about his
indicative rosters provided in these proceedings. Part of the calculations relate to Permanent
Part-Time employees which were purely speculative, as no employee currently works
Permanent Part-Time. The calculations were predicated on all employees electing to become
permanent after 6 months, although it was voluntary. These proposals were worked through
and discussed in proceedings before Commissioner Cambridge and Deputy President Dean.
This model assumed 14 Part-time Permanents, 11 Full-Time Permanents and 4 Casuals.
[77] Mr Ford said that sales employees were not included in the vote, although two who
also worked on the vessels, were included. Mr Ford acknowledged the modelling did not
include Hostesses or Juniors (the latter cannot be employed serving alcohol). Mr Ford agreed
that Juniors could be employed in other roles on the vessel. He had not provided any
modelling for Junior employees. Generally, there is one or two GPHs on a vessel.
In re-examination
[78] Mr Ford reiterated that when bargaining commenced in April 2015 and ever since, the
employees have been employed by Noorton Pty Ltd. Manly Fast Ferry did not employ any
employees and is a wholly owned subsidiary of Noorton Pty Ltd. He reaffirmed that Noorton
operates the Marine Tourism business and Manly Fast Ferry operates the Ferry services.
Mr Ford said that most of the Company’s vessels are signaged with Manly Fast Ferry and the
staff uniforms have Manly Fast Ferry logos, notwithstanding Manly Fast Ferry is not the
employer. Mr Ford explained there is a crossover of operations in Sydney Harbour, but the
revenues are separated ‘behind the scenes’ Mr Ford repeated that the 6 June 2017 NERR was
issued in the name of Noorton Pty Ltd.
[79] Mr Ford understood that Mr Chippendale had been a delegate of the Union, as he
attended most of the EBA negotiation meetings and was the main contact on site between the
crew and the applicant. Despite negotiating directly with Mr Chippendale after 6 June 2017,
[2018] FWC 4638
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the applicant continued to communicate with the Union, as it did by writing to the Union on
9 June 2017.
[80] Mr Ford claimed that the applicant believed that 32% to 35% of the work was Tourism
related and the remainder was Ferry work. By reference to the Certificate of Service for the
vessel Ocean Dreaming II, Mr Ford said the regulators require different conditions, crewing
and operating profiles when the same vessel operates marine or ferry services. This vessel
operates commuter ferry services in the morning/afternoon peaks and whale watching from
9:00 am to 4:00 pm.
[81] Mr Ford described the indicative roster and comparison documents as follows:
It shows – this document outlines the vessels and their start and finish times for each
shift, the length. The next column designates the service that that particular shift is
operating. Then the start and finish times, weekend shifts – so this document is an
embedded spreadsheet into the – sits in front of the previous document, and also the
comparative tables. So this outlines the indicative operating profile of the vessels at
the time this process was done. From there we can change or input the employees, be
it permanent, part-time or casual, on particular rosters to fill the roster and to fill the
shifts, and the result of these two combined will produce the comparison tables,
calculations, against – so this designates the hours that they've worked, when they start
and finish, and whether we designate it as ferry and tourism. So this gives us
flexibility to interrogate different profiles. So for example, when we wanted to do the
comparison when all work was ferry except for whales, we could toggle those columns
in column five to the all-ferry work. And that would give us different results.
(Transcript, PN1368)
[82] He then described the purpose of the applicant providing details of the employee’s
payslips:
The payslips outline each individual operation, and you'll see, in the description
column, if you look at page 1, you have a deckhand on MFF; you have a deckhand on
the Darling Harbour service, a deckhand on whale watching, a deckhand on the
Hopper service; training hours, travel. So these payslips outline exactly what was
worked. The timesheets come from the roster system, which may be modified or
changed, due to operational reasons, on any particular day, but the employees would
submit an updated timesheet, or explanation if the services are changed. So the
payslips demonstrate exactly what was worked, according to the employee in the
company. The roster indicates how it was originally rostered and proposed.
(Transcript, PN1426)
SUBMISSIONS
[2018] FWC 4638
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For the applicant
[83] In opening, Mr McCarthy put the following propositions:
(a) Noorton Pty Ltd was, and still is the employer of the employees who are employed
under the new Agreement.
(b) Noorton Pty Ltd operates the marine tourism services part of the business.
(c) Manly Fast Ferry Pty Ltd operates the ferry services part of the business.
(d) Noorton Pty Ltd wholly owns Manly Fast Ferry Pty Ltd.
(e) Noorton Pty Ltd and Manly Fast Ferry Pty Ltd are related corporations.
(f) At the time of the filing of these Submissions i.e. on 5 March 2018, Richard Ford
remains a Director of Noorton Pty Ltd and a Director of Manly Fast Ferry Pty Ltd.
(g) The business operates under the brand name ‘Manly Fast Ferry’. This is reflected in
the title of the new Agreement.
[84] In dealing with the pre-approval requirements, Mr McCarthy submitted that:
(a) On 6 June 2017 the Applicant issued a replacement NERR to each of the affected
employees.
(b) Subsequently each affected employee was issued:
a written notification of the time, place and method of voting to be used on 29th
June 2017 – A copy is attachment 4 of the Company’s Form F17.
A written request to vote on 30th June 2017 – A copy is Attachment 5 of the
Company’s Form F17.
(c) The ‘access period’ was the 7 day period prior to 11th July 2017 i.e. from 4th to 10th
July 2017.
(d) The employees were provided with a copy of the terms of the Agreement by Email
prior to the commencement of the access period.
(e) The employees were also provided access to the terms of the Agreement throughout
the Access Period via the applicant’s intranet. The relevant material was posted prior
to the commencement of the access period.
(f) The applicant took reasonable steps to explain the terms of the Agreement and its
effect on the employees during the access period.
[2018] FWC 4638
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(g) The majority of employees who cast a valid vote agreed to approve the proposed new
Agreement on 11 July 2017, which was more than 21 days after the NERR was issued.
(h) The group of employees covered by the Agreement were fairly chosen considering
geographical, operational or organizational distinctness. The new Agreement covers
all of the Company’s on-board vessel crew other than Officers i.e. General Purpose
Hands and Host/Hostess employees.
[85] Mr McCarthy submitted that the pre-approval processes and terms of the Agreement
met all the statutory requirements under the Act.
[86] In respect to the BOOT, Mr McCarthy noted that unlike agreements where one
agreement applies to different groups of employees covered by different awards, or where the
major or substantial work is performed in an industry, in this case the approach should be
different; see G.J.E. Pty Ltd [2013] FWCFB 1705 at [18] and [21] – [24]. In that case the
28.37% of revenue was sufficient to determine the ‘substantial character of the business’ was
in the retail industry and accordingly, this business was covered under the General Retail
Industry Award 2010.
[87] In this case, the business has more than one character operating in more than one
industry – ferry industry (65%) and marine tourism (35%). Mr McCarthy put that for the
purposes of the BOOT, the Commission would determine, as an exercise of discretion that:
(a) there are two applicable Modern Awards applying at the same time; and
(b) to the same employees who are performing work in two different industries that
would be covered by the two applicable Modern Awards in the same workplace at
one and the same time.
[88] Mr McCarthy noted that from the outset of negotiations, the Union had demanded and
the applicant agreed to have one Agreement covering both industries, providing there would
be a ‘blending and averaging’ approach to ensure a competitive cost structure in the marine
tourism sector.
[89] In respect to the two Awards being applicable, Mr McCarthy said the Commission
would take into account that:
[2018] FWC 4638
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(a) two ‘old’ Workplace Agreements exist and still currently operate;
(b) the two ‘old’ Workplace Agreements will be replaced by one Agreement;
(c) two modern awards operate in different sectors of the maritime industry.
(d) legal and contractual recognition of the distinction between when a vessel operates as
a ‘ferry’ and when the same vessel operates as marine tourism/charter vessel.
(e) Certificates of Survey issued under the Marine Safety (Domestic Commercial Vessel)
National Law Act 2012 (Cth) also recognise this differentiation.
(f) Statutory recognition of the differentiation as set out in the Passenger Transport Act
2014 (NSW); see s 39(1) and (2).
[90] Mr McCarthy identified a number of examples of tourism services, which do not
require a service contract with the NSW Government: lunch, coffee, dinner cruises, jet boats,
sailing cruises, shopper hopper services and whale watching. Mr McCarthy submitted that the
existence of a timetable, or a vessel capable of carrying more than eight passengers, is not a
determinative of a ferry service or a tourism service. It is determined by the purpose of the
service and the type of passengers carried on the service, i.e. commuters or tourists.
[91] Mr McCarthy submitted that the Award/Agreement comparisons, indicative rosters
and calculation tables, tendered by the applicant, in respect to rates of pay, overtime and
penalty rates disclose the following:
In every instance the casual rates prescribed by the new Agreement are higher than the
comparable rates prescribed for Casual employees by either of the two Modern
Awards.
In relation to future employment of Permanent employees, remembering that at
present all employees are employed as Casuals, the Table shows that the new
Agreement’s ordinary rates, overtime rates and penalty rates are higher than the
comparable rates prescribed for Permanent employees by either of the two Modern
Awards, other than in four circumstances. The four circumstances are:
Ports & Harbours etc. Award
1. Permanent employees ordinary hours rate on a Saturday;
2. Permanent employees ordinary hours rate on a Sunday; and
3. Permanent employees Overtime rate on a Sunday.
Marine Tourism etc. Award
4. Permanent Sunday Overtime rate after 3 hours of overtime.
[2018] FWC 4638
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73. However as the Wage Table also shows, when the two Modern Awards rates are
‘blended and averaged’, there is then only one circumstance where the Enterprise
Agreement’s rates are not higher than the “averaged and blended” Award rates, and
that is in the circumstance of permanent employees working ordinary hours on a
Sunday.
[92] All of these documents demonstrate that on all occasions, whether the employees are
Casual or Permanent Full-Time or Part-Time employees, the employees will be financially
better off under the Agreement, than the Awards. This has been extended by a 1.8% increase
paid from 1 December 2017. Mr McCarthy emphasised that the rates, in fact, meet the
Union’s position that ‘all of the shifts performed by employees are to be regarded as ferry
work, except for whale watching’. Mr McCarthy rejected the Union’s claim that it did not
have sufficient material to undertake its own calculations. These calculations had been
provided to Deputy President Dean on 29 September 2016.
[93] In response to a concern as to the rates applicable to GPHs for overtime or work on
Sunday and Public Holidays, the applicant proposed three ‘uplift’ allowances at Schedule 2 of
the Agreement. This will ensure that:
… when casual GPH employees work on a ferry run either:-
a. After 6:00PM Monday to Friday; or
b. On a Sunday; or
c. On a Public Holiday;
the employee will be paid an hourly rate that is equal to or greater than the otherwise
applicable rate for such work as prescribed by the Ports, Harbours and Enclosed
Water Vessels Award. It should be noted that the increase from 1 December 2017 in
the ‘uplift Allowances’ will ensure that the rates for such work will be greater in each
instance than the rates prescribed in the PH&EVV Award.
[94] Mr McCarthy rejected the Union’s contention that the Agreement does not pass the
BOOT. The Union’s case is based entirely on a false assumption that the Marine Tourism
Award has no relevance or application to this matter. In addition, the Commission’s Triage
Team had requested further information and appropriate undertakings as a result of its own
inquiries and a submission put to it by the Union. The applicant had provided two detailed
responses and source documents. It had offered an undertaking in respect to ‘Span of Hours’
(which the Union rejected). Mr McCarthy relied on Mr Ford’s evidence as to the limitations
on employment of Junior employees and why Junior rates are included to provide vocational
training of young people which is found in the Marine Tourism Award.
[2018] FWC 4638
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[95] In respect to the pre-approval steps, Mr McCarthy rejected the Union’s claim that the
applicant had, since April 2015, consistently misrepresented the name of the applicant by
identifying Manly Fast Ferry Pty Ltd as the employer of the employees, when on the
applicant’s own view, Noorton Pty Ltd is, and always was, the correct employer. The question
of the correct employer is a matter of fact. Noorton Pty Ltd was named as the employer on the
first NERR on 29 April 2015. Moreover, the Union itself referred to Manly Fast Ferry in a
publication it issued on 6 May 2015. In any event, the old Noorton Workplace Agreement
will continue to apply to the employees, without a new agreement in place. This is well
understood by the employees and the Union.
[96] Further, Mr Ford was at all material times a Director of Noorton Pty. Ltd and a
Director of Manly Fast Ferry Pty. Ltd; the two companies are related entities under the
Corporations Act; the operating businesses trade under the brand name of ‘Manly Fast Ferry’;
Manly Fast Ferry Pty Ltd operates the ferry service operations of the business and Noorton
Pty Ltd operates the marine tourism and commercial operations of the business.
[97] Mr McCarthy emphasised that all payslips and group certificates had been issued in
the name of Noorton Pty Ltd. There could be no misunderstanding as to the identity of the
employer. Mr McCarthy relied on Mr Ford’s evidence; see: para [43] as to the changing
business strategy as to the reason why the final NERR issued on 6 June 2017 was in the name
of Noorton Pty Ltd.
[98] Separately the Union must have been aware that Noorton was the employer when the
Union:
i) advised Noorton of a dispute on 16 June 2017 (matter C2017/3255); and
ii) presented employee payslips in a right of entry dispute under s 483AA (Matter
RE2017/786).
[99] Mr McCarthy addressed the Union’s submission that the Agreement was not
‘genuinely agreed’ because Noorton has not complied with the requirements under
s 173(1) and (2) in respect to notification time. That section reads:
173 Notice of employee representational rights
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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
(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)).
[100] Mr McCarthy said that there is no statutory requirement for an employer to take a
particular form of action, or to prove that it had agreed to bargain or initiated bargaining. This
is evident from existing case law and the Commission’s Benchbook on enterprise bargaining.
The decision in Uniline Australia Limited [2016] FWCFB 4969 does not support the Union’s
submission; in fact, quite the reverse. The applicant had initiated bargaining and had issued a
NERR within the 14 day time limitation. Even if the Union’s position is correct, the applicant
initiated bargaining with Mr Chippendale and Ms Spata in text messages of 31 May 2017 and
2 June 2017 prior to the last NERR issued on 6 June 2017. It is irrelevant whether Mr
Chippendale and Ms Spata were bargaining representatives, as the Company was
communicating directly with employees after the Union declared bargaining at an end. In any
event, Mr Chippendale had been known as the MUA site delegate and had been involved in
bargaining over a long period.
[2018] FWC 4638
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[101] Mr McCarthy put an alternative submission that the issuance of an NERR is itself an
act by the employer to initiate bargaining. This is because the prescribed terms of the NERR
do no more than put employees on notice of their bargaining rights to representation:
‘[The Employer] gives notice that it is bargaining in relation to an enterprise
agreement ([name of proposed enterprise agreement]) which is proposed to cover
employees that [proposed coverage].’
[102] In addition it is clear that further communications with the Union continued after the
issuance of the NERR with a ‘best and final offer’ conveyed to the Union on 9 June 2017.
[103] As to the cohort of employees identified as eligible voters, Mr McCarthy relied on the
steps taken by Mr Ford; see: para [66]-[68], which used both an independent service provider
and downloaded Company data showing:
- the Shift worked by the employee before or on the date of the vote;
- the Shift worked by the employee after the vote;
- the employees start date of employment with Noorton P/L; and
- the last date the employee logged on to the Company’s on-line roster system.
[104] Mr McCarthy addressed each of the circumstances of eight unnamed employees
identified in cross examination (Employees 2, 6, 11, 12, 16, 20, 33 and 37). No issue was
raised which would have disentitled any of these employees from the vote. Mr McCarthy
concluded as follows that:
(a) All 49 employees given a vote (the cohort) had started with the business not
only before the date of the vote, but had started with the business before the
end of the previous financial year (i.e. before 30 June 2017) and so had all
started at least 11 days before the date the vote took place on 11 July 2017.
(b) 38 of the 49 employees given a vote (i.e. 77.5%) started with the business more
than one year before the vote.
(c) 30 of the 49 employees given a vote (i.e. 61%) started with the business more
than 6 months year before the vote.
(d) 17 of the 49 employees given a vote (i.e. 35%) started with the business more
than 2 years before the vote.
(e) All 49 employees given a vote (i.e. 100%) worked for the business after the
date on which the vote was conducted on 11 July 2017.
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[105] This breakdown also demonstrated the Union’s claim of a high turnover of labour was
wrong. There was no uncertainty that Noorton had always been the legal employer. It
followed that all 49 employees were employed at the time of the vote and will be covered by
the Agreement; see: National Tertiary Education Industry Union v Swinburne University of
Technology [2015] 232 FCR 246 (‘Swinburne’) and McDermott v Automotive, Food, Metals,
Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing
Workers’ Union (AMWU) [2016] FWCFB 2222 (‘McDermott’) where a Full Bench said at
[32] and [35]:
‘[32] There is no issue that enterprise agreements were intended by the legislature to
be capable of covering casual employees, the difficulty is ascertaining when a casual
employee ought be regarded as an employee “employed at the time” within the
meaning of s.181(1). In relation to permanent employees it is relatively straight
forward exercise.
…
[35] The Commissioner was of the view that there was something wrong with the vote
occurring while employees were not actually performing or being paid for performing
work at the time of the vote. This in our view was incorrect; the status of the 36 casual
employees at the time of the vote is a natural and expected phenomenon of being
employed on a casual contract as per the Full Bench decision in Smiths Snackfood. In
our view it would be inappropriate and counter intuitive to disenfranchise casual
employees of a right to vote on an agreement that determines their wages and
conditions on the basis that they were not rostered on to work on the day/s of the vote,
or during the 7 day access period. 22 There are obvious implications for voting
manipulation adopting this approach. Swinburne is not authority for the proposition
that a casual employee is only “employed at the time” they are rostered to work and
are being paid. Swinburne eschewed the proposition that employed at the time
included “usually employed”.’
[106] Mr McCarthy contended that the facts of this case were even more telling than in
McDermott. All the Casual employees here will be covered by the Agreement when
performing work on board vessels operated by the applicant as either a GPH/Deckhand or a
Host/Hostess. Their employment is regular and systematic. This is evidenced by:
a 7 year ferry service contract with the NSW Government requiring ongoing crew
for the applicant’s vessels;
timesheets for all 49 employees demonstrate work rosters in advance;
timesheets show when employees are absent on unpaid leave;
all 49 employees worked both before and after the vote;
[2018] FWC 4638
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employee start dates are identified and employees (including long term) are
expected to return to work after recorded leave absences; and
the applicant recognises that the employees have unfair dismissal rights as regular
and systematic Casuals.
[107] Mr McCarthy rejected, as misrepresentation of the facts, the Union’s claim that the
employees had not been asked to vote to approve the Agreement, but rather had been asked to
approve a concept of making an agreement; this being contrary to s 182 of the Act. These
facts were that the title ‘Manly Fast Ferry – Sydney Harbour Services – On Board Crew –
GPH & Hosts – Enterprise Agreement 2017’ appeared in all the relevant communications
with the employees including:
a) an email and the attached proposed Agreement, dated 30 June 2017;
b) a screenshot of each employee’s Intranet access copy of the proposed Agreement;
c) a summary and explanation of changes document;
d) the notice to employees of the date and place of the vote, dated 29 June 2017;
e) formal notice of the voting process, dated 29 June 2017;
f) employer request to vote, dated 30 June 2017; and
g) employer’s summary and explanation of changes.
Given this material, there can be no doubt employees understood they were being asked to
vote to approve the Agreement.
[108] Mr McCarthy rejected the allegation that s 188(c) was not complied with. The Union’s
position was that the applicant misrepresented that the Agreement needed to be approved ‘by
a majority of employees’, rather than a majority of those who cast a valid vote. The correct
legal position was clearly set out in the Notice to Employees of the voting process which
stated:
“Counting the votes:-
[For your information, under s.182(1) of the Fair Work Act 2009 “… the Agreement is
made when a majority of those employees who cast a valid vote approve the
Agreement” i.e. 50% + 1 constitutes “approval”.].
[2018] FWC 4638
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[109] Mr McCarthy also rejected a similar misrepresentation submissions as to the true
operator of the business. Noorton Pty Ltd has no interest in the provision of the ferry services.
This is relevant as the issue is whether Noorton is the employer of the employees covered by
the Agreement - which it is. Secondly, the allegation is wrong, as Noorton is the employer of
all the employees in the business which operates marine tourism and charter vessels. This is a
dual role, as Mr Ford explained in cross examination.
For the Union
[110] Ms Doust submitted that the Commission could not be satisfied that Noorton Pty Ltd
is an employer capable of making an enterprise agreement or of making an application for
approval of an agreement, pursuant to s 185 of the Act. This was because from 14 September
2015 to 5 June 2017, Mr Ford repeatedly issued NERRs, and correspondence and he had
sworn documents before the Commission under the hand of Manly Fast Ferry. Mr Ford also
repeatedly represented Manly Fast Ferry as the employer to the employees and the Union. Ms
Doust noted that the F16 and F17 filed with an earlier Agreement in December 2016 refers at
various points to the employer as Manly Fast Ferry. Moreover, it is still contended that the
Manly Fast Ferry Pty Ltd & MUA - Sydney Harbour Ferry - Workplace Agreement 2009
identifies Manly Fast Ferry as an employer of the employees engaged on vessels operating on
the Circular Quay/Manly ferry service. Even if the Union was aware that Noorton was party
to the Commercial Vessels and Whale Watching Agreement, this does not make it more likely
the current employees are, and always were employed by Noorton.
[111] Ms Doust said that despite the Union applying for an Order to Produce in respect to
letters of engagement and details of the commencement of each employees offered a vote, no
such material was forthcoming. There is nothing to substantiate the existence of any contracts
of employment between the applicant and each employee offered a vote.
[112] Mr Ford’s explanation about ‘evolving events’ and ‘change of strategy’ and then not
proceeding with the business restructure is not credible. Nor was Mr Ford’s evidence that it
was not until May 2017 that he became aware, after legal advice, that the NERR needed to be
changed. Given Mr Ford was at all times being advised by Mr McCarthy, it is unbelievable
that the employer would proceed to negotiate an enterprise agreement and issue NERRs by an
entity, other than the legal employer. Ms Doust put that there is no scope in Part 2-4 of the
[2018] FWC 4638
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Act for the making of an enterprise agreement between a party which is not currently the
employer in the business concerned. This is clear from the ordinary meaning of the term
‘employer’ in s 15 of the Act and the meaning of a national system employer under s 14.
Given there was no evidence of ‘miscommunication’ between Mr McCarthy and Mr Ford, the
Commission would find his explanation ‘inconceivable’.
[113] Ms Doust submitted that the Commission would not regard Mr Ford as a reliable
witness, of care and precision, as to the status of employees when:
a) he mistakenly said in a signed statement there had been four votes of employees
(admittedly accepting this mistake in oral evidence);
b) he failed to mention in his second signed statement that a major change in ownership
of the applicant had recently taken place, being the acquisition of Mr Ford’s majority
shareholding in Noorton by NRMA Marine;
c) he had difficulty answering questions about the new corporate structure and was
unclear as to whether he continued to be a Director of either Manly Fast Ferry or
Noorton; and
d) he continued to ‘cavalierly’ describe Noorton Pty Ltd t/a Manly Fast Ferry when that
name is not a registered entity. He clearly lacks an understanding of the distinction
between the two entities and the regulatory environment in which they operate.
[114] Ms Doust claimed that payslips and Survey Certificates were created after the event.
They do not demonstrate which entity engaged the employees, according to a contract of
employment. Accordingly, the Commission would not be satisfied that Noorton is the
employer of every one of the employees in the business, or the applicant was capable of
negotiating an enterprise agreement with the employees.
[115] Ms Doust then dealt with each of the matters under ss 186 and 187 of the Act which
are required to be satisfied for the Agreement to be approved. She noted that s 181(2) serves
an important function of ensuring a period of at least 21 days after employees have been
informed of their bargaining rights before a proposed agreement is put to a vote.
[116] Ms Doust said that the effect of section 173 and section 174 read together is to require
the taking of reasonable steps by the employer (not some other entity) to give an NERR:
[2018] FWC 4638
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(a) in the prescribed form (s174);
(b) to each employee who would be covered by the agreement (s173(1)(a)), who
was employed at the time the employer (and not any other entity) either agreed
to bargain or had initiated bargaining; and
(c) as soon as practicable, and not later than 14 days, after that time.
[117] A notice in the proper form given by an entity, other than the employer, would not be
a notice given under s173(1). Nor would a notice given before the notification time as
defined. Obviously, if an attempted NERR failed to meet the requirements of s 173(1) then
the 21 day time period would not commence to run and the request to vote could not be
satisfied; see: Uniline Australia Limited [2016] FWCFB 4969 at [109].
[118] Ms Doust put that even accepting the applicant is correct as to the identity of the
employer, none of the earlier NERRs (29 April 2015, 14 September 2015, 26 April 2016, 23
February 2017), issued by Manly Fast Ferry were otherwise defective, by not including the
phone number of the Fair Work Commission Infoline.
[119] In addition, Ms Doust said the NERR of 6 June 2017 was invalid because it was not
issued as soon as practicable and not later than 14 days after the notification time for the
Agreement, being the time the employer agrees to bargain or initiates bargaining. Ms Doust
contended that nothing was done by Noorton to ‘initiate’ or ‘agree’ to bargain in the 14 day
period, prior to 6 June 2017. The highest the applicant’s evidence went on this issue were the
text messages to Mr Chippendale and Ms Spata. Nothing in these messages evinces any
intention of Noorton to initiate bargaining or that Mr Ford intended to bargain. The subject is
about what the employees should do, not what Noorton wanted to do. Ms Doust observed that
Mr Chippendale was not entitled to vote and did not vote and neither he, or Ms Spata were
bargaining representatives appointed by other employees. Moreover, no evidence was
adduced from Mr Chippendale or Ms Spata and there was no evidence that either of them
sought to bargain and Noorton therefore ‘agreed to bargain’ (with them).
[120] Ms Doust submitted that the only action of approaching anything like bargaining was
the 14 June 2017 email which enclosed a proposed agreement to be put to the vote. That
communication was too late to satisfy the requirements of s 181(2) of the Act. For the reasons
earlier mentioned, bargaining could not have been initiated by Noorton on 29 April 2015.
[2018] FWC 4638
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[121] Ms Doust dealt with the question of whether the employees said to be entitled to vote,
were employees who were employed at the time of the request to vote and who will be
covered by the Agreement. This goes to whether the Agreement has been ‘genuinely agreed’
to be a majority of those employees who cast a valid vote to approve the Agreement
(s 181(1)). This involves three elements:
(a) whether the correct cohort of employees had been requested to vote;
(b) whether the votes that were cast were votes to approve the agreement; and
(c) if they were, whether such votes constituted a valid majority.
[122] Ms Doust expressed real doubts as to whether the cohort of employees were in fact
employed by Manly Fast Ferry, in circumstances where:
(a) all the employees are Casual;
(b) there is a substantial turnover of labour; and
(c) there was the engagement of new Casual employees immediately prior to the vote.
[123] Relying on Swinburne, Ms Doust put that it is not enough that a casual employee
might be ‘usually employed’; rather it must be established, with certainty, that the person is
employed at the time. Further, a ‘future likelihood’ of someone being covered by an
agreement, is insufficient; see: Cimeco Pty Ltd v Construction, Forestry, Mining and Energy
Union and Others [2012] FWAFB 2206 and Construction, Forestry, Mining and Energy
Union v Hamberger [2011] FCA 919; 195 FCR 74. Section 188 of the Act will not be
satisfied if persons ineligible to vote, did vote and this may have affected the result; see:
University of New South Wales re University of New South Wales (Professional Staff)
Enterprise Agreement [2010] FWAA 9588.
[124] By reference to the redacted information of the list of employees and their timesheets.
Ms Doust set out a list of employees who voted, and who the Union claimed were either not
employed at the time of the vote, or would not be covered by the Agreement. The facts
associated with each unidentified employee were drawn from the timesheets provided by the
applicant. The table is as follows:
Employee No. Relevant Facts
2 Voted
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Not at work on the day of vote (11 July 2017)
Ex 5 shows worked on 22 and 23 June and then
on 20 and 21 July
MUA contends FWC would not be satisfied on
evidence was “employed at the time”
6 Not at work on day of vote
Ex 5 shows last day of work before vote Friday 2
June 2017
Noted as travelling in South America from 3 June
2017
Ex 5 shows next shift worked 4 September 2017
MUA contends FWC would not be satisfied on
evidence was “employed at the time” when the
employee was not at work for three months, or
that there was basis for concluding he “will be
covered” at that time. No evidence to show any
definite arrangement for the return of the
employee.
11 Voted
Not at work on day of vote
Ex 5 shows last date worked 26 May 2017
Ex 5 shows next shift worked 7 October 2017
No claim of any leave arrangement
MUA contends FWC would not be satisfied on
evidence was “employed at the time” when the
employee was not at work for over four months or
that there was basis for concluding he “will be
covered” at that time. No evidence to show any
definite arrangement for the return of the
employee.
12 Voted
All timesheet entries for employee in Ex 4 and Ex
5 show worked: “Darling Harbour Area
Sales Staff”; not in role covered by
agreement, no evidence to show when he
performed any deckhand/GPH/host duties
Employee marked as off on leave – “Rarotonga
Cook Islands Whale Research from 19 July”;
company aware for a week or two in advance; no
evidence that employee had a scheduled date of
return, such that it could be said he would be
covered by the agreement.
MUA contends FWC would not be satisfied on
evidence was “employed at the time” or that there
was basis for concluding he “will be covered” at
that time. No evidence to show any definite
arrangement for the return of the employee. No
proper basis to conclude that he “will be covered”
by agreement, in the sense of performing work
[2018] FWC 4638
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within its classifications.
16 Voted
Ex 4, p 18 records employee on holidays to Japan
from 26 June 2017
Ex 4 does not show any shift worked by
employee prior to date of vote
Not at work on date of vote
Ex 5 shows shifts worked 20 – 22 July 2017
MUA contends FWC would not be satisfied on
evidence was “employed at the time”
20 Voted
Employee was on a traineeship (which by their
nature are limited as to time)
Ex 5 shows shifts worked on 10, 11 12 July 2017;
trainee asking to have annual leave paid out on 12
July 2017, the day after the ballot
No evidence of shifts subsequent to 12 July 2017
Mr Ford unable to say whether traineeship
concluded as request for leave payout suggests
MUA contends FWC would not be satisfied that
there was proper basis for concluding he “will be
covered” by the agreement. The FWC would infer
that the employee requested his annual leave be
paid out because he was leaving employment and
that there was no proper basis to conclude that he
“will be covered” by agreement, in the sense of
performing work within its classifications once
the agreement is approved.
33 Voted
Majority of shifts worked shown in Exhibits 4 and
5 as Master V or Coxswain
Deckhand shifts worked only on 10, 11 and 12
July
MUA contends FWC would not be satisfied that
there was proper basis for concluding he “will be
covered” by the agreement in the sense of
performing work within its classifications once
the agreement is approved.
37 Voted
All entries in timesheets in Ex 4 and 5 for period
between 26 June and 17 July show employee
working as “Darling Harbour Area Sales
Staff”
No records of any performance of
deckhand/GPH/Host shifts produced
MUA contends FWC would not be satisfied that
there was proper basis for concluding he “will be
covered” by the agreement in the sense of
performing work within its classifications once the
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agreement is approved.
38 Voted
Ex 4 and Ex 5 show employee not at work
between 26 June 2017 and 23 July 2017; marked
as “Booked flights for family wedding in the UK”
No evidence of any shifts performed subsequent
to date of vote
MUA contends FWC would not be satisfied on
evidence was “employed at the time”
[125] Ms Doust did not dispute that a casual employee did not necessarily have to be
engaged on the day of the vote. However, the principles in Swinburne do not extend to
employees who are not present in the workplace for over four months or where there is no
expectation an employee will be offered further work upon their return from unpaid leave. Ms
Doust put that the Commission could not be confident that employees 12 and 37 above had
performed a shift covered by the Agreement. Given that a single invalid vote would change
the outcome of the vote, the Commission could not be satisfied the Agreement was made in
accordance with s 182 of the Act. In addition, the requirement that the vote be to approve the
Agreement, was not what the employees were asked when the question posed was whether
they agreed that a new MFF Enterprise Agreement for GPHs and Hosts be made?
[126] Pursuant to s 188(c), Ms Doust dealt with whether there were other reasonable
grounds why the Agreement might not be ‘genuinely agreed’. Section 188(c) imputes a
concern for the authenticity and moral authority of the Agreement; see Construction,
Forestry, Mining and Energy Union v Australian Industrial Relations Commission (1999) 93
FCR 317 (‘CFMEU v AIRC’). Consideration of the circumstances relevant to s 188(c) are not
limited. Ms Doust submitted the combined effect of all the circumstances surrounding the
history of this Agreement, gives rise to the type of concern contemplated by s 188(c). These
circumstances included the uncertainty over the applicable Award; the confusing and
changing identity of the true employer of the employees and other misleading information,
such as advice the Agreement would be approved if a majority of employees voted in favour,
rather than a majority of the valid votes cast in the ballot which was the earlier explanation
posed by the employer.
[127] Ms Doust then dealt with the Union’s BOOT contentions. The Union maintained that
the relevant Award is the Ports Award as Noorton is in the ports, harbours and enclosed water
[2018] FWC 4638
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vessels industry. The classifications in the Agreement, such as GPH and Host are identified in
that Award. Ms Doust relied on clause 4.1 of the Award to make good this proposition. It
reads:
4.1 This award covers employers throughout Australia in the ports, harbours and
enclosed water vessels industry and their employees in the classifications listed in
clause 13 to the exclusion of any other modern award. The award does not cover
employers and employees wholly or substantially covered by the following awards:
(a) the Maritime Offshore Oil and Gas Award 2010;
(b) the Seagoing Industry Award 2010;
(c) the Port Authorities Award 2010;
(d) the Dredging Industry Award 2010;
(e) the Stevedoring Industry Award 2010;
(f) the Marine Towage Award 2010; and
(g) the Marine Tourism and Charter Vessels Award 2010.
For the purpose of clause 4.1, ports, harbours and enclosed water vessels industry
means the operation of vessels of any type wholly or substantially within a port,
harbour or other body of water within the Australian coastline or at sea on activities
not covered by the above awards.
[128] Ms Doust said that while the Union agreed the classifications in the Marine Tourism
Award include crew roles such as Deckhand, GPH and Host roles, there is a significant
exclusion in the Award related to ferry activities. Clause 3.1 of the Marine Tourism Award
reads:
‘The “marine tourism and charter vessel industry” is defined by that Award to mean:
the operation of vessels engaged on a day charter or for an overnight charter wholly
or principally as a tourist, sightseeing, sailing or cruise vessel and/or as a place of or
for entertainment, functions, restaurant/food and beverage purposes engaged in the
provision of water orientated tourism, leisure and/or recreational activities but does
not include the operation of ferries engaged in regular scheduled passenger and/or
commuter transport.’
[129] Ms Doust added that a ‘ferry’ is defined under the Marine Safety Regulation 2016 and
Passenger Transport Act 2014 (NSW) as a vessel seating more than eight adult persons. All of
the applicant’s vessels fall within that definition (except perhaps for Totally Wild). The
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applicant’s vessels are timetabled to provide over 1000 services each week between Manly,
Circular Quay, Darling Harbour, North Sydney, Pyrmont and Watsons Bay (700 of these are
Manly/Circular Quay passenger services). This would be sufficient to establish that the
employer is wholly, or substantially engaged in activities not contemplated by the Marine
Tourism Award. In addition, Ms Doust said that the Eco Hopper service is a regular and
scheduled service. In any event, the fact a vessel might include sightseeing hop on/hop off
services during some hours, is not sufficient to overcome its predominant purpose as a ‘ferry’.
The Harbour Beaches ferry also operates a total of 28 regular and scheduled services. It is a
transport service, and in any event, a small proportion of the applicant’s business. Ms Doust
put that the applicant’s reliance on the State Act when the Federal Act applied, was
misconceived and not explained.
[130] Ms Doust observed that the applicant had not provided any evidence of the extent of
its charter, whale watching or special event services and, tellingly, did not include this work
in its BOOT modelling. This is because it is a very small proportion of the shifts worked by
employees. Ms Doust rejected Mr Ford’s evidence that it was the Company’s position that 32
– 35% of the hours worked are in the tourism sector. The ‘Company’s position’ is not
evidence of the factual position, particularly when no evidence was provided to support it.
Accordingly, the Commission should determine that the Ports Award is the relevant Award
for the purposes of the BOOT and although a submission that the two Awards apply is novel,
it does not detract from this proposition.
[131] Ms Doust set out the following matters as disadvantageous for the employees when
compared to the Ports Award:
(a) The absence of a requirement for part-time employees to have an agreed regular
pattern of work, and for any variation to be agreed in writing (cl 10.4(c) & (d));
(b) The absence of a minimum 2 hour engagement for part-time employees (cl 10.4(e));
(c) The absence of a minimum 3 hour engagement for casual employees (cl 10.3(d));
(d) The inclusion of ‘Junior Employees’ at clause 11.c of the Agreement. There is no
‘Juniors’ in the Ports Award;
(e) The absence of a classification covering the role of ‘ticket seller’;
(f) Clause 12 of the Agreement provides that for permanent employees, the rates in
Schedule 1 incorporate all shift penalties, weekend penalties, public holidays
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(except in relation to the additional payments for weekly employees when they work
on a public holiday), annual leave loading and all other allowances payable.
Depending on the hours and shifts actually worked by an employee, that provision
has the capacity to disadvantage an employee;
(g) The Agreement is less beneficial than the Ports Award in respect of the allowances
in 14.7, 14.12, 14.12, 14.14, 14.15, 14.17; 14.21, 14.22, 14.27;
(h) Clause 12.g. is inconsistent with the decision of the Full Bench in Shop, Distributive
and Allied Employees Association v Beechworth Bakery Employee Co Pty Ltd t/a
Beechworth Bakery [2017] FWCFB 1664 (‘Beechworth’).
(i) The Ports Award provides that wages will be paid weekly or fortnightly. Clause 13
of the Agreement permits, (by agreement) with a single employee or majority of
employees and the Company, for wages to be paid either four weekly or monthly;
(j) Clause 16.a of the Agreement does not provide for a span of hours, but allows for up
to 11 ordinary hours per day. Clause 18.2 of the Award provides for a span of hours
and prescribes 8 ordinary hours. Span of hours affects entitlements to overtime
payments. The absence of a span of itself is disadvantageous before any
consideration is given as to the monetary impact: the existence of a span is likely to
impose discipline on the employer in respect of rostering and the management of
work hours.
[132] Ms Doust noted that the Union had undertaken a BOOT analysis of 20 employees,
based on the redacted timesheets and payslips for the period 10 July to 23 July 2017, by
reference to the Agreement and the Ports Award in the following circumstances:
Normal hours
Saturday hours
Sunday hours
Training hours
Travel time
Working after 6:00 pm
[133] Ms Doust submitted that this analysis demonstrated that:
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(a) For the relevant period, employees 1, 2, 3, 8, 9, 41, 42, 43, 45, 47 and 49 (that is,
55% of the employees analysed) would have been ‘worse off’ under the Agreement,
than they would have been if paid under the Ports Award;
(b) One significant source of the disparity is Sunday work. For that work, the
Agreement provides the aggregated weekend rate in Table 1 of Schedule 2 of $35.40
per hour, whilst Sunday work under the Ports Award attracts a payment of $44.98
(with a 100% loading in cl 20.3). Under the Agreement, the Sunday ‘uplift’ rate
($45.00) is payable only in respect of the Circular Quay – Manly service. Other
vessels operating on a Sunday do not attract that ‘uplift’;
(c) A further major source of disadvantage is transport/travel. The Ports Award
provides at cl 14.22 for travelling time to and from the employee’s home, to be paid
at ordinary rates when the employee is required to commence before 6.00 a.m. or
finish after 11.00 p.m. The clause also provides for transport to be provided. No
similar provisions are in the Agreement;
(d) Where an employee starts or finishes at a location, other than their usual location,
the Ports Award provides, at clause 14.22(b) and (c) for payment whilst travelling
between locations (at the overtime rate if not by the worker’s own vehicle, and for a
minimum of half an hour if travelling in such vehicle) and either the payment of
travel expenses, or a mileage allowance. In short, travel costs are defrayed. Clause
26 of the Agreement provides for an employee to receive an additional 15 minutes
payment and reimbursement of travel costs up to $10.00. It is difficult to imagine
any worker being able to travel between any of the applicant’s work locations in less
than 15 minutes at a cost which does not exceed $10.00;
(e) Another source of disparity is work beyond 6.00 p.m. Under the Ports Award, rates
for an ‘afternoon shift’ (that is, a shift ending after 6.00 p.m. and before midnight)
attract an hourly rate of 115% of the ordinary time rate, or an additional $3.37 per
hour. That rate is applied for each hour of the shift. Under Cl 12(d)(iii) and Table 2
of Schedule 2 of the Agreement, hours worked after 6.00 p.m. on ‘ferry work’
attract an additional $2.00 per hour. The ‘undertaking’ provided by the applicant in
respect of span of hours has no impact on this issue, as it applies in respect of ‘day
work’.
[134] Ms Doust observed that while the applicant’s indicative rosters were based on a
speculative assumption of 11 Permanent, 14 Permanent Part-Time and 4 Casual employees
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when the entire work force is casual, Mr Ford accepted the applicant could not know how
many employees would take up the permanent option. Accordingly, the Commission could
have no confidence in the probative value of the applicant’s calculations.
[135] In respect to there being no Junior classifications in the Ports Award, it was noted that
the applicant might engage Juniors as GPHs. In those circumstances the rates are significantly
lower than the casual GPH and Host rates in the Ports Award. There would be a real prospect
Junior employees might be engaged in a Host/Hostess role at half the rate than would apply
for a GPH role.
Applicant’s reply submissions
[136] Mr McCarthy put that earlier invalid NERRs and associated documents are of no
relevance to the present application before the Commission. The only relevant NERR is that
issued on 6 June 2017 under the name of Noorton Pty Ltd; the Company who is, and always
has been the employer of employees to be covered by the Agreement.
[137] Mr McCarthy submitted that no adverse inference can be drawn by the fact there are
no ‘letters of appointment’ or ‘contracts of employment’ for the employees; all of whom are
engaged as Casuals. There is no legal requirement for written contracts to exist for there to be
contracts of employment between Noorton and its Casual employees. Any suggestion of
impropriety by Noorton in this respect should be soundly rejected. In any event, there is clear
documentary evidence of contracts of employment, being numerous payslips, group
certificates and timesheets. Further, the employees are specifically engaged under two current
old Workplace Agreements.
[138] Mr McCarthy rejected criticism of Mr Ford and the applicant for confusion over the
use of the brand name, Manly Fast Ferry. Mr Ford’s evidence on this matter was clear,
credible and honest. In any event, the only relevant circumstances relate to the NERR of
6 June 2017, citing the correct name of the employer. There was nothing ‘cavalier’ about Mr
Ford’s approach to the use of the name Manly Fast Ferry, given it is the name commonly
understood by employees, the public and in the industry generally. For surety, and on advice,
Noorton Pty Ltd has now registered the business name of Manly Fast Ferry (23 March 2018).
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Mr McCarthy insisted Noorton Pty Ltd was both competent to make the new Agreement and
make application to the Commission for approval of the Agreement.
[139] Mr McCarthy addressed each of the Union’s contentions as follows.
[140] The applicant only relies on the NERR issued under the name of Noorton Pty Ltd on 6
June 2017. It does not seek to rely on any of the earlier NERRs save for the fact they
demonstrate that bargaining had been ongoing since 29 April 2015 with Noorton Pty Ltd,
commonly known as Manly Fast Ferry.
[141] Mr McCarthy rejected the Union’s submission that nothing was done by the applicant
in the 14 days prior to the 6 June 2017 to initiate bargaining or agree to bargaining. He relied
on Mr Garrett’s declaration that ‘bargaining was concluded’ and the applicant’s ongoing
communication directly with persons it understood to be bargaining representatives of the
employees (and the MUA), Mr Chippendale and Ms Spata; see: Maritime Union of Australia,
The v Maersk Crewing Australia Pty Ltd [2016] FWCFB 1894 (‘Maersk’) at [34] and [35].
There can be no doubt the applicant had ‘agreed to bargain’ by its conduct and actions prior
to the issuance of the NERR on 6 June 2017. There is no evidence to the contrary; see:
Maersk at [49]. In any event, further ‘toing and froing’ occurred, including with advice to the
Union of the Company’s ‘best and final’ offer.
[142] As to the correct cohort of employees requested to vote, Mr McCarthy referred to the
uncontested evidence as to the periods of service of the employees (77.5% had worked for the
Company for over six months) as clearly demonstrating there was no ‘substantial turnover of
labour’ as claimed by the Union, or that there was a sudden influx of new Casual employees
before the vote. Rejecting the notion that employees were not regular and systematic Casuals,
Mr McCarthy referred to the method of payment set out in clause 10.3(c) of the Ports Award
and noted the Union conveniently left out the bolded wording.
(c) Casual employees must be paid at the termination of each engagement, but may
agree to be paid weekly or fortnightly.
[143] Mr McCarthy drew the following summary conclusions from Table 1 at para [124]
above:
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(a) 5 of the employees (No. 2., 6., 11., 16. and 38) were absent on a period of
leave at the time of the Vote.
(b) All 5 employees on leave were expected to resume work and all 5 employees
did resume work for the applicant after their period of leave.
(c) Employee No. 6 – who was on leave – did not vote.
(d) Employee No. 12 is a Ticket Seller who also performs shifts as a Deckhand
and therefore was entitled to vote.
(e) Employee No. 20 worked on the day of the vote as a Deckhand and was
entitled to vote.
(f) Employee No. 33 worked as a Deckhand on the day of the vote and was
entitled to vote.
(g) Employee No. 37 is a Ticket Seller who also performs shifts as a Deckhand
and was therefore was entitled to vote.
[144] Mr McCarthy maintained that all 49 employees who cast a vote were employed at the
time of the request to vote and will be covered by the Agreement.
[145] In rejecting the Union’s submission that there was uncertainty as to whether an
employee would still be employed by the employer in the future, Mr McCarthy observed that
no such requirement (as to certainty into the future) exists under s 181. In fact s 53 of the Act
provides that an enterprise agreement covers an employee ‘if the agreement is expressed to
cover (however described) the employee’.
[146] Mr McCarthy rejected the ‘no other reasonable grounds’ (s 188(c)) argument of the
Union and the decisions relied on; see: paragraph [126] above as being applicable in this case.
The Commission would have no concerns about impugned, improper or misleading conduct
of the applicant as alleged by the Union. On the contrary for over two years, the applicant has
been acting in good faith with the Union (including in related proceedings before three other
members of the Commission) for a new Agreement. There has been no egregious behaviour,
by act or omission of the applicant, for the Commission to find that the Agreement was not
‘genuinely agreed’ by the employees under s 188(c).
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[147] In respect to the exclusivity of the Ports Award in this case, and this matter being of
fundamental disagreement between the Company and the Union. Mr McCarthy recalled the
history of negotiations from April 2015 and the Union’s ‘in principle’ agreement to:
(a)one Agreement covering both industry sectors; and
(b)achieving this in a cost competitive and effective way through a ‘blending and
averaging’ approach to wage rates and conditions.
[148] Mr McCarthy stressed that in the two and a half years since and with over 20 draft
Agreements, these principles were reflected in the Agreement’s terms; most notably in cls 5
and 6 of the Agreement now before the Commission. Mr McCarthy questioned the Union’s
current position that all of the work performed by the business is ‘ferry’ work when it had
initially sought to expand the coverage of a single Agreement from only ‘ferry services’ to
cover both ‘ferry’ and ‘marine tourism’ operations. The truth is the Union’s own position and
actions reflected the reality of the business’s operations in both industry sectors (as does the
two Modern Awards). Mr McCarthy further noted that in two and a half years of bargaining
the Union had never sought an order from the Commission as to the correct reference
instrument.
[149] Mr McCarthy submitted that reliance on a statutory definition of a ‘ferry’ as any vessel
seating more than eight adult persons, is overly simplistic and does not reflect the wider
statutory framework which reflects the reality. He reaffirmed there are only two ferry services
(Manly/Circular Quay and Circular Quay/Darling Harbour). The remainder of the services are
marine tourism services. In addition, reliance on timetables does not establish a ‘ferry’
service. A marine tourism business would not be able to operate efficiently unless customers
had knowledge of scheduling and timetabling.
[150] Mr McCarthy rejected the submission that State based legislation has no relevance to
the determination of Federal industrial Award coverage. This ignores the extensive range of
state legislative provisions and licencing regimes directly impacting on the coverage and
operation of Federal awards, such as in mining, trades and transport.
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[151] As to the BOOT compliance, Mr McCarthy relied on the applicant’s earlier
submissions and specifically addressed each of the Union’s submissions; see: paragraph [131]
above, as follows:
a) The part time provisions arise from the Marine Tourism Award. Part time employees
are guaranteed 64 hours in each four week cycle, with a minimum of four hours and
maximum of 11 hours per day (The MUA claimed no minimum of two hours a day).
In any event, hourly rates under the Agreement are higher than either Modern Award
($26.62 versus $22.48 (Ports Award) and $20.15 (Marine Tourism Award))
Overtime over 11 hours is double time ($53.24).
b) Mr McCarthy emphasised that the applicant’s commitment to provide for an optional
casual conversion to permanent employment after six months service, was a
significant benefit to employees under the Agreement.
c) Casual employees will continue to be provided with a four hour daily minimum - one
hour more than the Ports Award.
d) As to Junior rates, Mr McCarthy relied on his earlier submissions, see: paragraph
[135] above. However, the applicant would be willing to consider an undertaking if
the Commission had any concerns.
e) Ticket sellers are not included in the Agreement, as they do not work on board vessels,
such as GPHs and Hosts/Hostesses.
f) Mr McCarthy relied on Mr Ford’s evidence as to the Union’s claim that the
Agreement does not provide for certain allowances payable under the Ports Award or
are less than equivalent allowances under that Award; see: paragraph [31] above.
g) Mr McCarthy relied on his earlier submissions as to the ‘make good’ provision in
clause 12(g). The Beechworth decision does not apply in this case as the Agreement is
already BOOT compliant. Clause 12(g) does no more than offer a further surety to
employees to that effect.
h) Mr McCarthy confirmed that the applicant will provide an undertaking that employees
will not be paid either four weekly or monthly.
i) In respect to span of hours, Mr McCarthy referred to his earlier submissions and
referred to the following undertaking provided to DP Gostencnik on behalf of the
applicant:
Span of Ordinary Hours for Daywork
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a. For Ferry Work:
i. Full-time employees – Employees ordinary hours of work while on daywork
shall be worked between 5:00am to 6:00pm Monday to Friday, for not less
than 5 consecutive ordinary hours and not more than 11 consecutive ordinary
hours on a day;
ii. For Part-time employees and Casual employees – Employees ordinary
hours of work while on daywork shall be worked between 5:00am to 6:00pm
Monday to Friday, for not less than 4 consecutive ordinary hours and not more
than 11 consecutive ordinary hours on a day.
b. For Marine Tourism Work:
i. Full-time employees – Employees ordinary hours of work while on daywork
shall be worked between 5:00am to 11:00pm Monday to Friday, for not less
than 5 consecutive ordinary hours and not more than 11 consecutive ordinary
hours on a day;
ii. For Part-time employees and Casual employees – Employees ordinary
hours of work while on daywork shall be worked between 5:00am to 11:00pm
Monday to Friday, for not less than 4 consecutive ordinary hours and not more
than 11 consecutive ordinary hours on a day.
[152] Mr McCarthy said that the applicant’s submissions and attached Excel spreadsheets
responded to the Union’s BOOT analysis of the payslips and timesheets of 20 employees for
the period 10 July to 23 July 2017. Firstly, he noted that the analysis relied on by the Union
were if the employees were all employed exclusively under the Ports Award and secondly, a
number of corrections needed to be made to the Union’s calculations because of double
counting and misallocation of hours. Thirdly, the Union had not compared the travel
provisions correctly as between the travel provisions under the Ports Award compared to the
Agreement. They are not ‘like with like’. This provision makes up for 90% of the Union’s
negative BOOT calculation. Mr McCarthy said the Agreement’s travel time and allowance
clauses provide an additional allowance when an employer starts work and finishes work at
different locations and must travel back to the place of origin. This is a different concept to
work commencing before 6:00 am. In addition the Agreement has separate Travel Outside of
Ordinary Hours/Call Back provisions (clause 26(b)).
[153] Mr McCarthy submitted that employees will continue to start work from 5:00 because
some employees prefer it. While recognising that under the Union’s modelling, some
employees might be ‘worse off ‘by being exclusively employed under the Ports Award, in
every example, the employees are ‘better off’ under the Agreement, where there is a
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combination of the two Awards. It is also important to note that the time snapshot of two
weeks will change, as employees rotate shifts resulting in an ‘evening out’ of any adverse
impact. Mr McCarthy submitted that the Commission would prefer the Company’s indicative
rosters tendered earlier in the proceedings, because they indicate the financial benefits the
employees will receive in the future. For example this analysis:
(a) Accurately reflects how the business will run in the future taking account of the new
provisions of the Agreement;
(b) Calculates the BOOT over a reasonable rostering period, not just one past 2 week
period of work;
(c) Calculates the BOOT in relation to all future classes of employees, i.e. Casuals, Full
Time employees and Part Time employees, and not just the past practice of all
employees being Casuals; and
(d) Even demonstrates a scenario where employees will be ‘better off’, even in the
circumstance that all work performed by the business is ‘ferry’ work, except whale
watching.
[154] Mr McCarthy put an alternative submissions should the Commission not be satisfied
that the applicant has met all the pre-approval compliance steps. He put that these proceedings
should be adjourned, until after the Federal Parliament passed the Fair Work Amendment
(Abolition of 4 yearly Reviews of Modern Awards and Other Measures) Bill 2017. This
proposed legislation, inter alia, would give the Commission the discretionary power to waive
any minor procedural defects when approving an enterprise agreement, provided that the
integrity of the agreement and its approval by employees, is unaffected.
CONSIDERATION
[155] In my assessment, this application and the Union’s objections to it, requires the
Commission to determine a number of matters under six broad headings. These are:
1. Whether Noorton Pty Ltd is an employer capable of making an enterprise agreement
and making an application for approval of the Agreement (the ‘standing’ issue).
2. Whether the applicant, Noorton Pty Ltd complied with all of the statutory pre-
approval steps for the making of an enterprise agreement (the ‘genuinely agreed’
issue)
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3. Whether the correct cohort of voters were employed at the time of the vote for the
approval of the Agreement and/or are to be covered by the Agreement (the ‘vote’
issue).
4. Whether there were other reasonable grounds for believing the Agreement had not
been ‘genuinely agreed’ by the employees (the ‘no other reasonable grounds’ issue).
5. Whether the Ports Award is the only Award which would otherwise cover the work
performed by employees of Noorton Pty Ltd (the ‘single Award’ issue).
6. Whether the Agreement satisfies the Better Off Overall Test (the ‘BOOT issue’).
[156] I will proceed to deal with each of these issues by reference to the statutory provisions
to which they relate, the submissions and evidence of the Union and the applicant and any
conclusions thereto.
Issue 1 - Whether Noorton Pty Ltd is an employer capable of making an enterprise
agreement and making an application for approval of the Agreement (the ‘standing
issue’).
[157] Section 172(2) of the Act sets out who will be covered by a proposed enterprise
agreement and reads as follows:
‘(2) An employer, or 2 or more employers that are single interest employers, may
make an enterprise agreement (a single-enterprise agreement ):
(a) with the employees who are employed at the time the agreement is made
and who will be covered by the agreement; or
(b) with one or more relevant employee organisations if:
(i) the agreement relates to a genuine new enterprise that the employer or
employers are establishing or propose to establish; and
(ii) the employer or employers have not employed any of the persons
who will be necessary for the normal conduct of that enterprise and will
be covered by the agreement.’
[158] Section 173 sets out the statutory requirements in respect to the issuance of NERRs as
follows:
‘173 Notice of employee representational rights
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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
(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.
Notice need not be given in certain circumstances
(4) An employer is not required to give a notice to an employee under subsection
(1) in relation to a proposed enterprise agreement if the employer has already given the
employee a notice under that subsection within a reasonable period before the
notification time for the agreement.
How notices are given
(5) The regulations may prescribe how notices under subsection (1) may be
given.’
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[159] Section 174 deals with the content and form of the NERR; noting it must be in the
exact form prescribed by the regulations; see: Application by Peabody Moorvale Pty Ltd
[2014] FWCFB 2042. It reads:
‘174 Content and form of notice of employee representational rights
Application of this section
(1) This section applies if an employer that will be covered by a proposed
enterprise agreement is required to give a notice under subsection 173(1) to an
employee.
Notice requirements
(1A) The notice must:
(a) contain the content prescribed by the regulations; and
(b) not contain any other content; and
(c) be in the form prescribed by the regulations.
(1B) When prescribing the content of the notice for the purposes of paragraph
(1A)(a), the regulations must ensure that the notice complies with this section.
Content of notice—employee may appoint a bargaining representative
(2) The notice must specify that the employee may appoint a bargaining
representative to represent the employee:
(a) in bargaining for the agreement; and
(b) in a matter before the FWC that relates to bargaining for the agreement.
Content of notice—default bargaining representative
(3) If subsection (4) does not apply, the notice must explain that:
(a) if the employee is a member of an employee organisation that is
entitled to represent the industrial interests of the employee in relation to work
that will be performed under the agreement; and
(b) the employee does not appoint another person as his or her bargaining
representative for the agreement;
the organisation will be the bargaining representative of the employee.
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Content of notice—bargaining representative if a low paid authorisation is in
operation
(4) If a low paid authorisation in relation to the agreement that specifies the
employer is in operation, the notice must explain the effect of paragraph 176(1)(b) and
subsection 176(2) (which deal with bargaining representatives for such agreements).
Content of notice—copy of instrument of appointment to be given
(5) The notice must explain the effect of paragraph 178(2)(a) (which deals with
giving a copy of an instrument of appointment of a bargaining representative to an
employee’s employer).’
[160] Sections 180-181 set out the mandatory preapproval steps for the approval of an
agreement. The sections read:
‘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).
Employees must be given copy of disclosure documents etc.
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(4A) If an organisation gives the employer a document under section 179 by the end
of the fourth day of the access period for the agreement, the employer must take all
reasonable steps to ensure that the relevant employees:
(a) are given a copy of the document as soon as practicable after it was given
to the employer; or
(b) are given access to a copy of the document as soon as practicable after it
was given to the employer and have access to that copy throughout the
remainder of the access period for the agreement.
Note: This subsection is a civil remedy provision (see Part 4-1).
(4B) If the employer is required to prepare a document under section 179A, the
employer must take all reasonable steps to ensure that the relevant employees:
(a) are given a copy of the document by the end of the fourth day of the access
period for the agreement; or
(b) are given access to a copy of the document by the end of that fourth day
and have access to that copy throughout the remainder of the access period for
the agreement.
Note: This subsection is a civil remedy provision (see Part 4-1).
(4C) The employer must not knowingly or recklessly make a false or misleading
representation in the document that the relevant employees are given a copy of or
access to under subsection (4B).
Note: This subsection is a civil remedy provision (see Part 4-1).
Terms of the agreement must be explained to employees etc.
(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.’
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‘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.’
[161] The 6 June 2017 NERR stated that Noorton Pty Ltd was the employer and had the
authority to issue the last NERR. The Union went to considerable effort to trace the two and a
half year history of the negotiations for the Agreement with Ms Doust closely cross-
examining Mr Ford in order to establish that the Union and the employees had been misled as
to the employer’s true identity. Putting aside the Union brought no evidence from any
employees, in my view, the only relevant identification of the employer for the purposes of
negotiating the Agreement and making the application for approving the Agreement, is the
last NERR issued on 6 June 2017 (and the F17).
[162] It is common, during protracted agreement negotiations, for more than one, (and
sometimes multiple), NERRs to be issued. The Act makes plain, by s 181(2), that the only
relevant NERR is the last notice made under s 173(1). Having been issued 21 days before the
request for a ballot can be made, it follows that earlier requests for a ballot may have been
made, or an unsuccessful ballot may have taken place, but they are not relevant. Such a
history does not impugn the last NERR (assuming all other preapproval steps are complied
with). However, before a ballot, the only non-compliance issue, resulting in a rejection of the
application on this issue, is if the last NERR was issued less than 21 days before the ballot
had been requested. That is not the case here.
[163] The fact there may be no letter of appointment or contracts of employment with the
employees is not a statutory test as to issuance of the last NERR. It will be a question of fact
as to whether the employees were employed by the named employer as stated in the NERR. It
is Noorton Pty Ltd - of that there can be no legal doubt. Of course, whether some of the
[2018] FWC 4638
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employees of Noorton Pty Ltd were not eligible to cast a vote in the ballot, or will not be
covered by the Agreement, are completely different propositions which I shall come to
shortly.
[164] In any event, having been involved in this matter for some time, I have no doubt at all
that the use of the brand name Manly Fast Ferry is commonly understood and accepted by the
Union and the employees. It is a name well known to customers and the industry as the entity
supplying ferry and tourism services in Sydney Harbour. Moreover, the employees would
have been in no doubt as to their legal employer being Noorton Pty Ltd. Their payslips and
Group Certificates over a number of years make this abundantly clear. In addition, the
following facts are relevant to dispel any claim of confusion or uncertainty as to the legal
employer of the employees:
(a) Noorton Pty Ltd is referred to in one of the old Workplace Agreements which have
been in place for many years, and continue to remain in force. That agreement covers
whale watching activities.
(b) The use of the name ‘Manly Fast Ferry’ in the title of the Agreement is irrelevant to
the legal name of the employer of the employees to be covered by the Agreement.
There is certainly no requirement for the name of the employer to feature in the title of
the Agreement (as thousands of approved agreements obviously demonstrate);
(c) The evidence that Mr Ford was confused as to his use of the name, Manly Fast Ferry
or that his evidence was said by the Union to lack credibility, is not the point; although
I accept Ms Doust’s submission that it may be relevant to section 188(c) of the Act
(the ‘no other reasonable grounds’ issue);
(d) At all times, the Union and the employees knew Mr Ford was the person who had
authority to negotiate on behalf of Noorton as a bargaining representative. In any
event, Mr Ford was an officer of Noorton and at the same time an officer of Manly
Fast Ferry, a wholly owned subsidiary of Noorton Pty Ltd. There is no evidence the
Union, or any employee had ever challenged Mr Ford’s standing or authority to
negotiate the terms of the Agreement.
[165] Accordingly, I am satisfied that the NERR issued by Noorton Pty Ltd on 6 June 2017:
(a) contains the prescribed content as set out in the Regulations;
(b) does not contain any other content; and
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(c) is in the form prescribed by the Regulations.
[166] There being no other matter which might impugn the validity of the 6 June 2017
NERR, I am satisfied that ss 172, 173, 181 and 188 have been complied with. It follows that it
is unnecessary to consider Mr McCarthy’s alternative submission that this matter should be
adjourned pending passage of the Fair Work Amendment (Abolition of 4 yearly Reviews of
Modern Awards and Other Measures) Bill 2017; see: para [154]. However, I would note that
this is a rather bizarre submissions given that:
(a) there appears to be no urgency from any quarter to have the Bill brought before the
Senate; and
(b) it would be unlikely that any amendment to the Act would have retrospective
operation.
Issue 2 - Whether the applicant Noorton Pty Ltd complied with all of the statutory pre-
approval steps for the making of an enterprise agreement (the ‘genuinely agreed’ issue)
[167] Sections 186, 187 and 188 set out the requirements which must be met before an
agreement can be approved; notably, the requirements that the Commission must be satisfied
the employees covered by the agreement ‘genuinely agreed’ to it. The sections are as follows:
‘186 When the FWC must approve an enterprise agreement—general
requirements
Basic rule
(1) If an application for the approval of an enterprise agreement is made under
section 185, the FWC must approve the agreement under this section if the
requirements set out in this section and section 187 are met.
Note: The FWC may approve an enterprise agreement under this section with
undertakings (see section 190).
Requirements relating to the safety net etc.
(2) The FWC must be satisfied that:
(a) if the agreement is not a greenfields agreement—the agreement has
been genuinely agreed to by the employees covered by the agreement; and
(b) if the agreement is a multi enterprise agreement:
(i) the agreement has been genuinely agreed to by each employer
covered by the agreement; and
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(ii) no person coerced, or threatened to coerce, any of the
employers to make the agreement; and
(c) the terms of the agreement do not contravene section 55 (which deals
with the interaction between the National Employment Standards and
enterprise agreements etc.); and
(d) the agreement passes the better off overall test.
Note 1:For when an enterprise agreement has been genuinely agreed to by employees,
see section 188.
Note 2:The FWC may approve an enterprise agreement that does not pass the better
off overall test if approval would not be contrary to the public interest (see section
189).
Note 3:The terms of an enterprise agreement may supplement the National
Employment Standards (see paragraph 55(4)(b)).
Requirement that the group of employees covered by the agreement is fairly chosen
(3) The FWC must be satisfied that the group of employees covered by the
agreement was fairly chosen.
(3A) If the agreement does not cover all of the employees of the employer or
employers covered by the agreement, the FWC must, in deciding whether the group of
employees covered was fairly chosen, take into account whether the group is
geographically, operationally or organisationally distinct.
Requirement that there be no unlawful terms
(4) The FWC must be satisfied that the agreement does not include any unlawful
terms (see Subdivision D of this Division).
Requirement that there be no designated outworker terms
(4A) The FWC must be satisfied that the agreement does not include any designated
outworker terms.
Requirement for a nominal expiry date etc.
(5) The FWC must be satisfied that:
(a) the agreement specifies a date as its nominal expiry date; and
(b) the date will not be more than 4 years after the day on which the FWC
approves the agreement.
Requirement for a term about settling disputes
(6) The FWC must be satisfied that the agreement includes a term:
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(a) that provides a procedure that requires or allows the FWC, or another
person who is independent of the employers, employees or employee
organisations covered by the agreement, to settle disputes:
(i) about any matters arising under the agreement; and
(ii) in relation to the National Employment Standards; and
(b) that allows for the representation of employees covered by the
agreement for the purposes of that procedure.
Note 1:The FWC or a person must not settle a dispute about whether an employer had
reasonable business grounds under subsection 65(5) or 76(4) (see subsections 739(2)
and 740(2)).
Note 2:However, this does not prevent the FWC from dealing with a dispute relating
to a term of an enterprise agreement that has the same (or substantially the same)
effect as subsection 65(5) or 76(4)’
‘187 When the FWC must approve an enterprise agreement—additional
requirements
Additional requirements
(1) This section sets out additional requirements that must be met before the FWC
approves an enterprise agreement under section 186.
Requirement that approval not be inconsistent with good faith bargaining etc.
(2) The FWC must be satisfied that approving the agreement would not be
inconsistent with or undermine good faith bargaining by one or more bargaining
representatives for a proposed enterprise agreement, or an enterprise agreement, in
relation to which a scope order is in operation.
Requirement relating to notice of variation of agreement
(3) If a bargaining representative is required to vary the agreement as referred to in
subsection 184(2), the FWC must be satisfied that the bargaining representative has
complied with that subsection and subsection 184(3) (which deals with giving notice
of the variation).
Requirements relating to particular kinds of employees
(4) The FWC must be satisfied as referred to in any provisions of Subdivision E of
this Division that apply in relation to the agreement.
Note: Subdivision E of this Division deals with approval requirements relating to
particular kinds of employees.
Requirements relating to greenfields agreements
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(5) If the agreement is a greenfields agreement, the FWC must be satisfied that:
(a) the relevant employee organisations that will be covered by the
agreement are (taken as a group) entitled to represent the industrial interests of
a majority of the employees who will be covered by the agreement, in relation
to work to be performed under the agreement; and
(b) it is in the public interest to approve the agreement.’
‘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.’
[168] The Union submitted that the Agreement was not ‘genuinely agreed’ (s 188(a)(ii)))
because the 6 June 2017 NERR was not given under s 173(1) as it was not given after the
notification time (a 173(2)) because in the 14 days prior to 6 June, Noorton had not agreed to
bargain, nor had it initiated bargaining (s 173(3)).
[169] In my view, there is a pall of unreality about the Union’s submission in this respect,
given the state of negotiations preceding the 6 June 2017 NERR. On 29 May 2017, the Union
declared bargaining was over. In response, the applicant then sought to bargain directly with
its employees, namely two employees (one of whom Mr Ford understood to be not only a
representative of the employees, but also an MUA delegate who had attended many of the
negotiations over the previous two years). These communications were by SMS text messages
as follows:
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Mr Ford – ‘Ok, they have declared a full scale attack on mff as expected it was not just
the casual Sunday rate they want hcf rates across the board. Looks like we have gone
back 2 years after all the work the crew have done. It is not time for mff to standup as
a group and talk with management.
employee – what do they mean by a full scale attack? Industrial action? I will have a
talk with crew over the next day or so to gather their thoughts
Mr Ford – Yes we should sit with yourself and Nic and discuss where we want it all to
go. Will call tomorrow.
employee – Ok no worries
Mr Ford – Hi beau, have you got 10min to talk today?
Mr Ford – Yeah all good
[170] Whatever might be said about the motivation for these communications, the fact is
they demonstrate an intent to initiate bargaining with the relevant employees or that the
applicant had agreed to bargain in a different context. In my view, there is nothing in s 173
which prescribes, or limits the manner in which the employer may agree to bargain or initiate
bargaining. The words should be given their plain, ordinary meaning. This observation is
consistent with the definition of ‘notification time’ in Maritime Union of Australia v Maersk
Crewing Australia Pty Ltd [2016] FWCFB 1894. There the Full Bench said at [34]-[35]:
‘[34] Contrary to Maersk’s contention, s.437(2A) defines the commencement of
bargaining by reference to a ‘notification time’ within the meaning of s.173(2), not by
the giving of a NERR. As observed by Hatcher VP in Transport Workers' Union of
Australia v Hunter Operations Pty Ltd (‘Hunter’), the definition of ‘notification time’
in s.173(2)(a), ‘indicates that an employer’s agreement to bargain is a single event
which happens at a particular point in time’. Hence, s.437(2A) refers to a point in time
– the ‘notification time’ – not what the FW Act prescribes must be done by an
employer at that point in time (ie issue a NERR within 14 days of the ‘notification
time’: ss 173(1) and (3)).
[35] As Hatcher VP observed in Hunter , ‘an employer may agree to bargain expressly
in writing or orally, or … an employer may be inferred to have agreed to bargain
through its conduct (such as by commencing to actually engage in bargaining in
relation to a proposed enterprise agreement)’. The issuing of an NERR may evidence
that the employer has agreed to bargain, but the requirement to issue the NERR arises
once the employer has agreed to bargain or has initiated bargaining – it is not a
prerequisite for bargaining. Whether an employer has agreed to bargain or has initiated
bargaining in relation to a proposed enterprise agreement is a question of fact. An
NERR is an indicator of employer intention – but not necessarily the determining
factor.’
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[171] Further support for these propositions is demonstrated by the not uncommon
circumstances where bargaining has already commenced and then maybe suspended for many
months and later sought to be reactivated. In such cases, it is not unusual for a new
notification time to be advised and a new NERR issued no later than 14 days later. I also
accept Mr McCarthy’s submission that the fact the applicant had agreed to bargain or initiated
bargaining were also the communications it had with the Union, as the default bargaining
representative, as a result of the issuance of the NERR on 6 June 2017 and the steps taken by
the employer to put its ‘best and final’ offer and then proceed to the vote on 11 July 2017.
Issue 3 - Whether the correct cohort of voters were employed at the time of the vote for
the approval of the Agreement and/or are to be covered by the Agreement (the ‘vote’
issue).
[172] Section 182 defines when an agreement is made and reads:
“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
(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;
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the agreement is made immediately after the end of the voting process referred to in
subsection 181(1).
[173] I agree with Union that in order for the Commission to be satisfied an agreement has
been ‘genuinely agreed’, compliance with s 181(2) is necessary and in the present context,
whether:
(a) the correct cohort of employees have been requested to vote;
(b) the votes that were cast were votes to approve the Agreement; and
(c) if they were, whether such votes constituted a majority.
[174] Section 182 must be read with section 181(1), which identifies two tests as to the
eligibility of employees to vote for an agreement. These are:
The employees must be employed at the time of the vote: and
The employees who vote will be covered by the agreement.
[175] Ms Doust relied on the decision in Swinburne. In my view, the important paragraphs
relevant to this case, are found at paras [30]-[32] which read:
‘30. I have had the benefit of reading a draft of the reasons of Jessup J and agree with
the orders he proposes but have a different view about the Commission’s construction
of the relevant provision.
31. The Union contended in this appeal that the Commission’s decision was affected
by five jurisdictional errors. The first error was said to be the adoption of an erroneous
construction of the words “employees” and “employees employed at the time” in s
181(1) of the Fair Work Act 2009 (Cth) (“the Fair Work Act”). Section 181(1) permits
an employer that will be covered by a proposed enterprise agreement to request the
employees to approve the agreement by vote. The class of employees whose approval
may be sought by vote is described in the section as “the employees employed at the
time who will be covered by the agreement”. The section provides:
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.
The persons who were requested by Swinburne to vote included sessional teachers
employed in the previous year. The Union contended that the sessional teachers
employed in the previous year did not fall within the statutory class of employees
eligible to vote because they were not “employees employed at the time”.
32. The construction of the words “employees employed at the time who will be
covered by the agreement” which was adopted by Swinburne, and accepted by the
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Commission, was one that included persons who might not actually be engaged in
employment at the time of the vote but who were argued to come within the broader
meaning of employees, namely as persons who were “usually employed” at that time.
That construction was not, in my view, erroneous. The word “employees” in s 181 has
its ordinary meaning extended by s 15 of the Fair Work Act to a person who is usually
such an employee. Section 15 provides:
15 Ordinary meanings of employee and employer
(1) A reference in this Act to an employee with its ordinary meaning:
(a) includes a reference to a person who is usually such an employee; and
(b) does not include a person on a vocational placement.
Note: Subsections 30E(1) and 30P(1) extend the meaning of employee in
relation to a referring State.
(2) A reference in this Act to an employer with its ordinary meaning includes a
reference to a person who is usually such an employer.
Note: Subsections 30E(2) and 30P(2) extend the meaning of employer in
relation to a referring State.
The express inclusion of a person who is “usually” an employee into the ordinary
meaning of the word “employee” extends the class of persons treated as employees.
The class of persons treated as employees is thus made to include those, to adopt the
words in Re National Wine Centre Certified Agreement (PR910912, AIRC, Adelaide,
8 November 2011) at [40], where there is “a level of regularity and connection
between [the] employee and the employer”. The words “employed at the time”, which
follow the word “employees” in s 181(1), do not undo the extension of the category of
employees effected by s 15 but, rather, ensure that there is a temporal connection
between the time of voting and the circumstances required to exist to come within the
extended meaning given to “employees”. Thus a person will be entitled to vote under s
181(1) if that person is (at the time of voting) an employee in the extended sense
effected by s 15, namely, that the person is “usually” such an employee at the time
albeit not an employee in the ordinary (unextended) meaning.’
[176] The difficulty of identifying the valid cohort of employees who can vote for an
agreement has been commented on in a number of significant cases. In Construction,
Forestry, Mining and Energy Unio v John Holland Pty Ltd [2015] FCAFC 16, the Full Court
of the Federal Court Buchanan J (with whom Besanko and Barker JJ agreed), said at [34]-
[41]:
‘34. One question which has troubled me is whether it is correct to accept, as appears
to have been the case, that the reference in s 186(3) to “the group of employees
covered by the agreement” is a reference to the whole class of employees to whom the
agreement might in future apply, rather than the group of employees which actually
voted on whether to make the agreement.
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35. It may at once be observed that the second-mentioned group is fixed in time and
known, whereas the wider, potential group is not fixed at any point in time and may be
very difficult to evaluate or assess, depending on the breadth of coverage specified by
the terms of the agreement and, perhaps, the nature and complexity of the employer’s
business.
36. The virtual impossibility of knowing with certainty the composition of the whole
group within the potential coverage of the agreement, compared with the complete
certainty about those to whom a vote is in fact offered, makes the choice of the first
alternative construction an attractive one unless such a construction is excluded by the
terms of the statute. However, that is not the construction which has so far been
accepted and there appear to be sound reasons for preferring the other, wider
construction.
37. First, the traditional concepts of application and coverage, which are now reflected
in ss 52 and 53 of the FW Act, recognise the difference between actual application (i.e.
to then present employees) and potential coverage (extending to the whole class of
employees at any point in time). The procedural steps required for making an
agreement with employees focus, of necessity, on the need for majority support by
those present employees who will be covered by the agreement but once an agreement
is made the matters which require consideration by the FWC in relation to whether an
agreement must be approved are not necessarily confined in the same way.
38. Secondly, there are other indications in the FW Act that a distinction must be made
between the group of present employees who will be covered by an agreement and the
wider group who will be covered if the agreement is made. Indications of that sort may
be seen in the procedures to assist “good faith bargaining”, whereby a bargaining
representative (which may be a union – s 176(1)(b)) may apply to the FWC for a
“majority support determination” or a “scope order”. In either case, the FWC must
address the question (similarly to s 186(3) and (3A)) whether “the group of employees
who will be covered by the agreement was fairly chosen” and whether the group is
geographically, operationally or organisationally distinct (s 237(2)(c), (3A); s
238(4A)). In context, it appears clear that this is a wider group (corresponding to
potential coverage) than the group of present employees who wish to bargain or whose
immediate interests are those being represented.
39. Thirdly, and perhaps most decisively, as counsel for the respondent pointed out in
the present case, s 186(3) and (3A) apply to both greenfields agreements and
agreements made with employees. They would have no context or operation in
relation to a greenfields agreement unless the wider view was taken.
40. That wider view is the one which has been taken by the FWC, and it was accepted
by all parties to the present appeal.
41. One reason I have spent some time examining the correctness of the common
assumption about this issue is that upon the view that the group to be considered under
s 186(3) and (3A) reflects potential (not present) coverage it will often (perhaps
usually) be impossible to state with much precision or certainty what that coverage
might entail in a practical sense in the years to come, or how the group might at any
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particular point in time be composed. However, that seems to me to be the
consequence of the legislative scheme. The evaluation which the legislature has
committed to the FWC must therefore be carried out with that consequence being
understood and accepted. That is relevant to an examination of some of the findings of
the Full Bench.’
[177] The High Court in ALDI Foods Pty Limited v Shop, Distributive & Allied Employees
Association [2017] HCA 53 also addressed the words ‘who will be covered’ by the
agreement in the present context. At paras [76]-[77] the High Court said:
‘76. The SDA's argument, and the reasoning of the majority of the Full Court, cannot
stand with the plain and ordinary meaning of s 172(2) and (4) of the Act. Those
provisions, as mentioned, contemplate the making of non-greenfields agreements with
persons already employed. In addition, while s 186 operates on the assumption that
there are employees covered by the agreement at the time the application for approval
is made, it does not follow that the agreement must apply to them in the sense of
operating to fix their rights and obligations in the work actually being performed by
them at that time.
77. The question of coverage that arises when the Commission asks whether the
agreement has been genuinely agreed to for the purposes of s 186(2)(a) is not whether
the employees voting for the agreement are actually employed under its terms, but
rather whether the agreement covers all employees who may in future have the terms
and conditions of their jobs regulated by it. At the stage of considering whether an
enterprise agreement is available to be made under s 172 of the Act, ie when no
agreement has as yet been made, it is a natural and ordinary use of language to speak
of the employees whose jobs are within the scope of the proposed agreement as
employees who "will be covered" by the agreement. At the stage of considering
whether an enterprise agreement, which has been made (by virtue of s 182(1)), should
be approved pursuant to s 186(2)(a), it is a natural and ordinary use of language to
speak of the employees, whose jobs are described by the terms of the agreement which
has been made, as employees who "are covered" by the agreement.’
[178] A more intensive consideration arises under s 180(5) of the Act as to whether the
Agreement was ‘genuinely agreed’ by the employees, as a result of the judgement of the Full
Court of the Federal Court in One Key Workforce Pty Ltd v Construction, Forestry, Mining
and Energy Union [2018] FCAFC 77 (‘One Key’). This judgement was published on 25 May
2018, four weeks after the Commission had reserved its decision in this matter. The Full
Court concluded that:
In order to reach the requisite state of satisfaction that s 180(5) had been
complied with, the Commission was required to consider the content of the
explanation and the terms in which it was conveyed, having regard to all the
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circumstances and needs of the employees and the nature of the changes made
by the Agreement.
The absence of that information meant that the Commission was not in a
position to form the requisite state of satisfaction.
Without knowing the content of the explanation, it was not open to the
Commission to be satisfied that all reasonable steps had been taken to ensure
that the terms and their effect had been explained to the employees who voted
on the Agreement or that they had genuinely agreed to the Agreement.
[179] I did not invite further submissions from the parties arising from ‘One Key’, because I
was satisfied that the applicant had taken reasonable steps to ensure the terms of the
Agreement, and their effect, had been explained to the employees consistent with One Key.
That finding is manifest by the long history of negotiations, the active involvement of the
Union itself, in explaining the effect of the Agreement’s terms, and more specifically the
detailed 17 page Summary and Explanation of Changes (Annexure 6 to the F17) sent to all
relevant employees. I note also a paid Employee Information Session for all employees on 2
July 2017. In my view, these were all reasonable steps taken by the applicant, which satisfy s
180(5) of the Act and are consonant the One Key judgement.
[180] As will be evident from Ms Doust’s submissions, the Union maintains that there is
doubt about these two preconditions, given the entire workforce are Casual employees; there
is a substantial turnover of labour; and more Casual employees were employed before the
vote. Reliance was had on the generally well established view that each casual engagement is
a separate contract of employment; see: Shortland v Smiths Snackfoods [2010] FWAFB 5709
at [10]. This is not the case here. It is clear the Casual employees were engaged by the
applicant on an ongoing basis with regular and systematic employment. The evidence is that
77.5% employees who voted, had worked for the business for at least six months. All 49
employees who voted, had been working for Noorton in the previous financial year; (see:
Group Certificates).
[181] It is obvious the employer considers the employees are regular and systematic Casual
employees. The employees are all engaged according to rosters, and employees make known
to the employer (and may seek approval before) when making a request to have time off
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without pay. There is evidence the employees, after any period of extended time off, are re-
engaged upon their return.
[182] In my view, Swinburne does not assist the Union’s arguments. The evidence
establishes that employees are not just ‘usually employed’ - they are employees who
comfortably fit within the expression ‘employed at the time’.
[183] Further, I reject the Union’s claim that there has been a substantial turnover of labour
and that new Casual employees were engaged immediately before the vote. The evidence
does not support either claim. I hazard a guess that if a casual Union member was dismissed,
the Union would strongly assert they are covered by the unfair dismissal provisions under the
Act and are regular and systematic employees. Mr Ford’s position is that is exactly how he
treats the workforce.
[184] To support its submissions, the Union asserted that nine of the 49 employees who
voted in the ballot, were ineligible to do so. It undertook an examination of the rosters and
work performed by each employee to substantiate its assertion. I accept that of the nine
employees:
(a) 5 of the employees were absent on a period of leave at the time of the vote. They were
employees No. 2, 6, 11, 16 and 38.
(b) All 5 employees on leave were expected to resume work and all 5 employees did
resume work for the Company after their period of leave.
(c) Employee No. 6 – who was on leave – did not vote.
(d) Employee No. 12 – is a Ticket Seller who also performs shifts as a Deckhand and was
therefore entitled to vote.
(e) Employee No. 20 worked on the day of the Vote as a Deckhand and was entitled to
vote.
(f) Employee No. 33 worked as a Deckhand on the day of the Vote and was entitled to
vote.
(g) Employee No. 37 is a Ticket Seller who also performs shifts as a Deckhand and was
therefore entitled to vote.
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[185] In addition, given the factual employment profile of the nine employees said to be
ineligible to vote, I accept that these employees were employed at the time of the vote,
(irrespective of whether they were rostered off on the days of the vote), and meet the second
precondition of being employees who are to be covered by the Agreement.
[186] Further, I do not accept the Union’s claim that the question posed by the ballot was not
specific to the Agreement, but meant a non-specific agreement and was therefore inconsistent
with s 182. By the use of the article ‘a’, as distinct to ‘the’, is a difference without a
distinction. The Agreement the GPHs and Hosts were asked to approve was the one that had
been distributed to them as the ‘last and final offer’. There was no other Agreement relevant
in any practical or statutory sense. Moreover, there could have been no confusion as to what
the employees were voting on. No evidence was adduced from any employee that they were
confused, or did not understand what Agreement they were being asked to approve.
Issue 4 - Whether there were other reasonable grounds for believing the Agreement had
not been genuinely agreed by the employees (s 188(c)) (the ‘no other reasonable
grounds’ issue).
[187] The Union set out its concerns going to ‘other reasonable grounds’ as follows:
(a) The ongoing dispute about the applicable reference instrument;
(b) the misrepresentation by the applicant as to the true identity of the employer of the
relevant employees;
(c) misrepresentation of the voting process; and
(d) new employees were engaged before the vote and other employees were not employed
at the time of the vote.
[188] Ms Doust submitted that the Commission would have concerns with to the
‘authenticity’ and ‘moral authority’ of the Agreement; see: Construction, Forestry, Mining
and Energy Union v The Australian Industrial Relations Commission [2001] HCA 16; 203
CLR 645 (‘CFMEU v AIRC’). It will be seen that I have dealt with the above matters
elsewhere in this decision. Having regard to the protracted history of this matter, the
comprehensive and detailed material provided by the applicant and its intention to comply
with all statutory obligations, I cannot identify any behaviour or conduct which would lead
me to have concerns the employees did not ‘genuinely agree’ to the Agreement. More
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specifically, the ongoing dispute as to the appropriate Modern Award reference instrument
has been an open disagreement from the outset, which was never going to be resolved by the
parties themselves. Mere disagreement does not amount to egregious or unreasonable
behaviour. The facts and circumstances go nowhere close to those identified in CFMEU v
AIRC or Toys-R-Us (1995) 37 AILR 3068 Print L9066.
Issue 5 - Whether the Ports Award is the only Award which would otherwise cover the
work performed by employees of Noorton Pty Ltd (the ‘single Award’ issue).
[189] There is no doubt that an employer’s enterprise can be covered by one or more
Modern Awards. For example, a factory in which the employer has manufacturing, transport
and clerical functions and where employees do not move outside their respective award
coverage, is covered by the respective Modern Awards. Less common, but not rare, are
enterprises which, for seasonal or operational reasons, employees may move between the
coverage of two or more Modern Awards; for example a farm on which produce is grown and
harvested and then stored and distributed. Employees are involved in the horticultural
industry and the storage/warehousing industries. In the maritime industry, there have been
disputes concerning whether employees are engaged under the Seagoing Industry Award or
the Ports, Harbour and Enclosed Water Award. Closer to home, it is common ground that the
majority of work to be covered by this Agreement (although the exact percentage is
disagreed) would fall within ‘ferry’ work and be otherwise covered by the Ports Award. The
Union insists that this means the Ports Award is the only relevant instrument for the purposes
of the BOOT. Where there are disputes about which Modern Award reference instrument
applies for the purposes of the BOOT, it is invariably the case that the rates and conditions
under a proposed agreement may not meet one reference instrument, but will meet another.
But that is not the situation in this case. As I understand the evidence, the employees will be
‘better off’ whether the test is against the Marine Tourism Award or the Ports Award, (save
for whale watching, which no party claims is not tourism work).
[190] In other words, the Union’s claim as to the Ports Award being the only Award to be
applied for the purposes of the BOOT, is an arid argument. It makes no difference as to
whether the Agreement passes the BOOT. In any event, there is no statutory prohibition on
the Commission finding that two Modern Awards are the relevant reference instruments for
the purposes of the BOOT. I am satisfied that this is the position in respect to operations of
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Noorton's on-board vessel operations. I shall return to the Union’s BOOT submissions
shortly.
Issue 6 - Whether the Agreement satisfies the Better Off Overall Test (the ‘BOOT
issue’).
[191] A critical statutory provision in this case concerns whether the Agreement passes the
BOOT. The relevant provisions are set out in section 193 and read:
“193 Passing the better off overall test
When a non greenfields agreement passes the better off overall test
(1) An enterprise agreement that is not a greenfields agreement passes the better
off overall test under this section if the FWC is satisfied, as at the test time, that each
award covered employee, and each prospective award covered employee, for the
agreement would be better off overall if the agreement applied to the employee than if
the relevant modern award applied to the employee.
FWC must disregard individual flexibility arrangement
(2) If, under the flexibility term in the relevant modern award, an individual
flexibility arrangement has been agreed to by an award covered employee and his or
her employer, the FWC must disregard the individual flexibility arrangement for the
purposes of determining whether the agreement passes the better off overall test.
When a greenfields agreement passes the better off overall test
(3) A greenfields agreement passes the better off overall test under this section if
the FWC is satisfied, as at the test time, that each prospective award covered employee
for the agreement would be better off overall if the agreement applied to the employee
than if the relevant modern award applied to the employee.
Award covered employee
(4) An award covered employee for an enterprise agreement is an employee who:
(a) is covered by the agreement; and
(b) at the test time, is covered by a modern award (the relevant modern
award) that:
(i) is in operation; and
(ii) covers the employee in relation to the work that he or she is to
perform under the agreement; and
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(iii) covers his or her employer.
Prospective award covered employee
(5) A prospective award covered employee for an enterprise agreement is a person
who, if he or she were an employee at the test time of an employer covered by the
agreement:
(a) would be covered by the agreement; and
(b) would be covered by a modern award (the relevant modern award) that:
(i) is in operation; and
(ii) would cover the person in relation to the work that he or she
would perform under the agreement; and
(iii) covers the employer.
Test time
(6) The test time is the time the application for approval of the agreement by the
FWC was made under section 185.
FWC may assume employee better off overall in certain circumstances
(7) For the purposes of determining whether an enterprise agreement passes the
better off overall test, if a class of employees to which a particular employee belongs
would be better off if the agreement applied to that class than if the relevant modern
award applied to that class, the FWC is entitled to assume, in the absence of evidence
to the contrary, that the employee would be better off overall if the agreement applied
to the employee.”
[192] The applicant has proposed a number of undertakings. The section dealing with
undertakings and their effects are found at section 190 and 191 as follows:
‘190 FWC may approve an enterprise agreement with undertakings
Application of this section
(1) This section applies if:
(a) an application for the approval of an enterprise agreement has been made
under subsection 182(4) or section 185; and
(b) the FWC has a concern that the agreement does not meet the requirements
set out in sections 186 and 187.
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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.’
[193] As I have found that both Modern Awards are relevant reference instruments for the
purposes of the BOOT, it needs to be emphasised that on the evidence before the
Commission, the Agreement passes the BOOT, whichever Modern Award is used as the
BOOT comparator. The Union’s submissions and its position in recent times is that the Ports
Award is the only relevant instrument for the purposes of the BOOT. Whatever is the Union’s
policy intent in respect to its insistence on this proposition, it is not relevant in this application
in the BOOT context. In Beechworth, the Full Bench said at para [12]:
‘[12] The application of the better off overall test is not to be applied as a line by line
analysis. Rather it is a global test requiring consideration of advantages and
disadvantages to award covered employees and prospective award covered employees
of an agreement’s application compared to the application of a relevant modern award.
The application of the better off overall test therefore requires the identification of
terms of an agreement which are more beneficial to the relevant employees when
compared to the relevant modern award, the terms of an agreement which are less
beneficial or detrimental when compared to the relevant modern award and then an
overall assessment of whether each relevant employee would be better off under the
agreement.’
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[194] Since the decision was reserved in this matter, a five member Full Bench has clarified
a number of matters going to the application of the BOOT, particularly in respect to loaded
rates agreements; see: Loaded Rates Agreements [2018] FWCFB 3610. A number of extracts
from that decision are relevant for present purposes. At paragraphs 101, 106 and 111 the Full
Bench said:
‘[101] In the case of anything other than small employers, it would be an exhaustive
task to examine the circumstances of each individual employee to reach a state of
satisfaction that the BOOT is passed. Section 193(7) substantially relieves the
Commission of this burden by permitting it to assume, if a class of employees to
which a particular employee belongs would be better off under the agreement than
under the relevant modern award, that the employees would be better off overall in the
absence of evidence to the contrary. Paragraph 818 of the Explanatory Memorandum
to the Fair Work Bill 2008 contains some information as to how this provision was
envisaged to operate as follows (emphasis added):
“818. Although the better off overall test requires FWA to be satisfied that each
award covered employee and each prospective award covered employee will be
better off overall, it is intended that FWA will generally be able to apply the
better off overall test to classes of employees. In the context of the approval of
enterprise agreements, the better off overall test does not require FWA to
enquire into each employee's individual circumstances.
Illustrative example
Moss Hardware and Garden Supplies Pty Ltd makes an enterprise agreement to
cover approximately 1800 employees working at its national chain of retail
garden and hardware supplies outlets. All of these employees are 'award
covered employees'. The seven classifications under the agreement broadly
correlate to seven classifications under the relevant modern award. Because
there will be many employees within each classification under the
agreement and the agreement affects each employee within a classification in
the same way, FWA could group employees together when assessing the
employees against the better off overall test. It is intended that FWA could
assess a hypothetical employee in each of the classifications under the
agreement against the relevant classification under the modern award.
If FWA were satisfied that the agreement affected each employee within the
classification in the same way, and that the agreement passed the better off
overall test for the hypothetical employee within the classification, FWA could
be satisfied that the agreement passed the better off overall test for each award
covered employee and prospective award covered employee within that
classification.”
…
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[106] Where a substantial disparity of this nature exists between the current workforce
as at test time and the class of prospective employees to whom the agreement might
apply in the future, such that useful predictions as to future employment patterns may
not readily be drawn from the way in which the existing workforce operates, the
starting point must necessarily be an examination of the terms of the agreement in
order to ascertain the nature and characteristics of the employment which the
agreement provides for or permits. In accordance with established principles of the
construction of agreements, the express provisions of an enterprise agreement may be
approached on the basis that they were intended to establish binding obligations and
have a practical field of operation and are not otiose. Thus, for example, if an
enterprise agreement makes express provision for employees to be required to work
ordinary hours on weekends, that provision cannot be ignored for BOOT purposes
simply on the basis that the employer asserts that it does not currently, and does not
intend to, make use of that provision. There may be objective evidence available
which might support the conclusion that, notwithstanding an express provision of the
agreement which apparently permits something to be done, it cannot in fact be done or
is extremely unlikely to be done. For example, a provision in an agreement applying to
a retail business allowing for ordinary hours of work to be performed at identified
unsociable hours might reasonably be disregarded for BOOT purposes if applicable
laws concerning retail trading hours prohibits work being done at the relevant times.
However this is not likely to be a common circumstance.
[111] The submission made by the ARA that the requirement to assess the BOOT as at
the “test time” (being the time at which the application for approval of the relevant
agreement is made) means that only the operational circumstances of the employer
(such as its work rosters) as at that time may be considered is also rejected. The
requirement to assess the BOOT in respect of prospective as well as existing
employees tells against the adoption of such an approach. Because, as the Full Court
decision in John Holland made clear, it is open to make an enterprise agreement
covering classifications, occupations and work locations that are not part of the
employer’s operations as at test time, the requirement to assess the BOOT with respect
to prospective employees who might fall within such future classifications,
occupations and/or work locations must necessarily take into account how the
agreement might in practice apply when such employees are engaged in the future.
The application of the BOOT would be rendered nonsensical and ineffective with
respect to such prospective employees if only the employer’s existing operations,
which did not involve the use of prospective employees in the categories permitted by
the agreement, could be taken into account. The statutory purpose of the requirement
to assess the BOOT as at the test time is, we consider, to permit rates of pay and other
conditions of employment in the agreement and the relevant award to be compared at a
fixed point of time when the terms of both are known. Absent such a temporal
requirement, the application of the BOOT would require speculation about future
changes to the provisions of the award, in circumstances where the agreement to be
assessed may also involve agreed changes such as increases in rates of pay at defined
intervals, and would involve the impossible task of making multiple comparisons for
the whole of the period in which the agreement remains in operation.’(citations
removed)
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[195] The Full Bench set out 11 Principles which apply to the application of the BOOT to a
loaded rates agreement. These are:
‘(1) The BOOT requires every existing and prospective award covered employee to be
better off overall under the agreement for which approval is sought than under the
relevant modern award. If any such employee is not better off overall, the agreement
does not pass the BOOT.
(2) Section 193(7) permits the Commission to assume that if a class of employees to
which a particular employee belongs would be better off under the agreement than
under the relevant modern award, then the employee would be better off overall in the
absence of evidence to the contrary. However the selection of class for the purpose of
s 193(7) will only be of utility if the agreement affects the members of the class in the
same way such that there is likely to be a common BOOT outcome. If the Commission
is not satisfied on the evidence that an existing or prospective award covered
employee is not better off overall, the Commission cannot approve the agreement, at
least not without undertakings or in the confined circumstances set out in s 189.
(3) The application of the BOOT to a loaded rates agreement will, in order for a
meaningful comparison to be made, require an examination of the practices and
arrangements concerning the working of ordinary and overtime hours by existing and
prospective employees that flow from the terms of the agreement. This will likely
require classes to be identified based on common patterns of working hours, taking
into account evening, weekend and/or overtime hours worked.
(4) The starting point for the assessment will necessarily be an examination of the
terms of the agreement in order to ascertain the nature and characteristics of the
employment for which the agreement provides or permits. For example if an enterprise
agreement makes express provision for employees to be required to work ordinary
hours on weekends, those provisions cannot be ignored for BOOT purposes simply
because the employer asserts it does not currently utilise those working hours or roster
patterns.
(5) In the case of existing employees, this may involve an examination of existing
roster patterns worked by various classes of employees as at the test time. The use of
sample rosters to compare remuneration produced by a loaded rates pay structure
compared to the relevant modern award may be an effective method of doing this.
There may be objective evidence that a particular pattern of working hours or roster
pattern permitted by an enterprise agreement is not practicable, or cannot or is unlikely
to be worked.
(6) In the case of prospective employees, the assessment will necessarily involve a
degree of conjecture. In the case of an enterprise operating at a defined workplace or
workplaces, the Commission may be in a position to make sensible predictions about
the basis upon which prospective employees might be engaged based on the roster
patterns worked by existing employees. However if a business is small and/or still at
the development stage, or the agreement would cover a wider range of classifications,
work locations and/or roster patterns that are not in existence as at the test time, useful
predictions may not readily be drawn from the way in which the existing workforce
operates. In that situation the assessment will require an examination of the terms of
the agreement in order to ascertain the nature and characteristics of the employment
which the agreement provides for or permits.
(7) If the information concerning patterns of working hours needed to assess whether a
loaded rates agreement passes the BOOT is not contained in the employer’s Form F17
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statutory declaration accompanying the approval application, it may be necessary for
the Commission to request or require the production of such information.
(8) The BOOT involves the making of an overall assessment as to whether an
employee would be better off under the agreement, which necessitates identification of
the terms in the agreements which are more and less beneficial to the employee than
under the relevant award.
(9) The overall assessment required will essentially be a mathematical one where the
terms being compared relate directly to remuneration. The assessment will be more
complex where the agreement contains some superior entitlements which are non-
monetary in nature, accessible at the employee’s option or which are contingent upon
specified events occurring.
(10) In respect of non-monetary, optional or contingent entitlements in an agreement,
the assumption cannot readily be made that they have the same value for all
employees. In the case of a contingent benefit, it will be necessary to make a realistic
assessment about the likelihood of the benefit crystallising during the period in which
the agreement will operate.
(11) Where a loaded rates agreement results in significant financial detriment for
existing or prospective employees compared to the relevant award, it is unlikely that a
non-monetary, optional or contingent entitlement under the agreement will sufficiently
compensate for the detriment for all affected employees such as to enable the
agreement to pass the BOOT.’
[196] While on one view, the Agreement here is strictly not a loaded rates agreement,
because the intention is for an agreement which ‘blends and averages’ the two Awards, for
abundant caution, I shall determine whether to approve this Agreement in respect to the
BOOT, by reference to these Principles.
[197] In my view, the following matters are pertinent background to this process.
[198] The applicant has gone to extraordinary lengths through an analysis of the rosters,
payslips and assumptions advanced by both parties to justify its BOOT modelling and
remodelling, including providing the modelling to other members of the Commission, by
producing precisely what section 193(1) requires – that each award covered employee and
each prospective award covered employee would be ‘better off’ if the Agreement applied. In
my experience, few employers, for obvious practical reasons, undertake the BOOT for
prospective employees; see: Construction, Forestry, Mining and Energy Union v John
Holland Pty Ltd [2015] FCAFC 16. In this case, Noorton has provided calculations on current
rosters over a two week period and then produced indicative modelling for Casual, Part-Time
and Full-Time employees. It has undertaken the exercise with the expectation that some
employees will opt to convert to Permanent Part-Time or Full-Time employment after six
months. Obviously, it is pure speculation as to the number of employees who may elect do so.
I am confounded by the Union’s criticism of this approach, given it is more likely the
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applicant would be criticised for not undertaking the BOOT exercise in respect to
prospectively covered employees.
[199] Secondly, the applicant has responded to, and addressed concerns identified by the
Enterprise Agreement Triage Team and DP Gostencnik by proposing undertakings, which I
am prepared to accept. I also intend to invite the applicant to provide undertakings in respect
to:
(a) Reimbursement of any work related expenses; see: para [31(f)] above;
(b) Payment of wages to be only weekly or fortnightly; see: para [31(k)] above;
(c) Should Junior employees be rostered to work on a vessel as a GPH, their rate of pay
should ensure that they are ‘better off overall’ when compared to the Awards.
[200] Thirdly, there are issues raised by the Union in respect to corresponding provisions of
the Ports Award, said to be disadvantageous in comparison, when in fact they are better than
the Ports Award, e.g. a minimum of four hours Part-Time engagement, when the Ports Award
provides for two hours. Part-time provisions provide for higher rates than either Award. Four
hour minimum engagement of casuals (three hours in the Ports Award)
Neutral or not relevant matters
[201] Those matters, which, in my opinion, are neutral in the BOOT analysis are:
(a) transport for employees who start at one location and finish at another; and
(b) the ‘make good’ provision. As the rates of pay are higher than the two Modern
Awards and the Agreement meets the BOOT on either Award comparison,
‘Beechworth’ is not relevant. Mr McCarthy described the provision as just providing
some surety for employees. I note however, that had the ‘make good’ provision been a
relevant matter for the purposes of the BOOT, it would have been inconsistent with
Beechworth, given the review period is 6 months. My preference would be to delete a
provision which has no practical utility and which may lead to confusion.
[202] Those matters which are not relevant are:
(a) The Agreement does not cover ticket sellers (only GPH/deckhands and
hosts/hostesses);
(b) bilge allowance is not applicable;
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(c) first aid allowance does not apply, because no employees are appointed first aid
officers;
(d) the allowance when a ship is stranded, wrecked or on fire is not applicable;
(e) higher duties provisions are not applicable.
A small number of other conditions are referable only to the Marine Tourism Award. These
are:
(a) part-time provisions in respect to an employee’s regular work patterns and hours;
(b) overtime rates for charter employees.
[203] Fourthly, those matters which are more beneficial include the rates of pay. In addition,
there can be no doubt that the applicant’s acceptance of an optional Permanent Part/Full-Time
conversion clause for long-standing Casuals is a matter of some significance for many
employees. I note that the Full Court of the Federal Court in One Key (para [205] to [206])
said it was a ‘bold submission’ of the employer to put that a casual conversion clause (in other
words the reverse of what is proposed here) was a benefit to employees. I agree. In my view,
the corollary of this view is when a full casual workforce is offered the advantages of
permanent employment, it must be a benefit in the BOOT assessment. I am moved to observe
that given the Union movement’s strong opposition to ‘precarious’ employment, including to
casual employment, that such a change would be more likely welcomed by the Union, than
opposed. It is a matter, in my opinion, that must be taken into account when making an
overall BOOT assessment of the Agreement, particularly when there is consideration to the
one issue focused on by the Union – the 5am start time compared to the 6am start time under
the Ports Award.
[204] In the Loaded Rates Case, the Full Bench discussed the overall assessment of the
terms and conditions in an agreement when considering the BOOT at paragraph [112]:
‘[112] The second proposition is that the BOOT requires an overall assessment to be
made. This requires the identification of terms which are more beneficial for an
employee, terms which are less beneficial, and an overall assessment of whether an
employee would be better off under the agreement. Where the terms required to be
compared bear directly upon the remuneration of employees, the assessment is
essentially a mathematical one. However the position becomes more complex when an
agreement contains provisions superior to or not contained in the reference award
conferring entitlements to non-monetary benefits, benefits which are accessible at the
employee’s choice, or monetary benefits which are contingent upon specified events
occurring. While it is necessary to take such entitlements into account in the BOOT
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assessment, ascertaining the value they are to be assigned may be a difficult task. This
difficulty was adverted to in the Full Bench decision in National Tertiary Education
Industry Union v University of New South Wales in the following terms:
“[96] There is an obvious problem of comparing apples with oranges when it
comes to including changes to non-monetary terms and conditions into the
‘overall’ assessment that is required by the BOOT. In such circumstances the
Tribunal must simply do its best and make what amounts to an impressionistic
assessment, albeit by taking into account any evidence about the significance to
particular classes of employees covered by the Agreement of changes to non-
monetary terms that render them less beneficial than the equivalent non-
monetary term in an award.”’ (citations removed)
[205] Having carefully balanced all of the matters posited by the Union as concerns going to
the BOOT, I am satisfied that the Agreement is BOOT compliant in that when the test of
whether employees and prospective employees are ‘better off overall’, the answer must be in
the affirmative.
Other matters
[206] I intend to make further general findings on the other statutory requirements for
approval of the Agreement. The Agreement provides for the mandatory flexibility and
consultation terms at cls 38 and 39 respectively and a disputes resolution procedure at cl 43
provides for conciliation and arbitration by the Commission. I also foreshadow that pursuant
to s 201(2) of the Act, the Construction, Forestry, Maritime, Mining and Energy Union shall
be covered by the Agreement. The Agreement will operate pursuant to s 52 of the Act, 7 days
after my formal approval.
Disposal of proceedings
[207] The applicant is directed to file further undertakings in respect to the matters set out in
para [199] above. Given these were matters raised by the Union, I expect they will meet the
requirements of s 190(3) of the Act. However, to avoid falling foul of s 190(4) of the Act,
consequent upon receipt of any undertakings, I shall seek the views of the bargaining
representatives before formally approving the Agreement.
[208] These proceedings are otherwise concluded.
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DEPUTY PRESIDENT
Appearances:
Mr S McCarthy, Solicitor for the applicant.
Ms L Doust, Counsel with Mr A Jacka for the Union.
Hearing details:
2018.
Sydney:
February 12 and 13.
Final written submissions:
For the applicant 16 April 2018.
For the Union 3 April 2018.
Printed by authority of the Commonwealth Government Printer
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ORK WORK COMMISSION FAIR THE SEAL OF