1
Fair Work Act 2009
s.185—Enterprise agreement
Georgiou Group Pty Ltd
(AG2018/2416)
DEPUTY PRESIDENT BEAUMONT PERTH, 22 JANUARY 2019
Application for approval of the Georgiou Group (Trades and Services) Enterprise Agreement
2018.
Introduction and conclusion
[1] Georgiou Group Pty Ltd (Georgiou) made an application under s 185 of the Fair
Work Act 2009 (the Act) for the approval of an enterprise agreement (the Application) known
as the Georgiou Group (Trades & Services) Enterprise Agreement 2018 (the Trades &
Services Agreement). The Trades & Services Agreement is a single-enterprise agreement.
[2] In Georgiou Group Pty Ltd AG2018/2415,1 (the Operations Decision), I considered
the application for the approval Georgiou Group (Operations) Enterprise Agreement 2018
(Operations Agreement). In the Operations Decision there had been a controversy over
whether the Operations Agreement should be approved by the Fair Work Commission (the
Commission).
[3] The Construction, Forestry, Maritime, Mining, and Energy Union (CFMMEU),
previously the Construction, Forestry, Mining, and Energy Union (CFMEU), had objected to
the approval of the Operations Agreement, and had made a request to be heard in relation to
the Application. The request was acceded to given the CFMMEU was, by default, a
bargaining representative. In addition, I considered the proper course was for the
Commission to properly inform itself by exercising discretion to hear from the CFMMEU
regarding the application for approval, in light of the submissions and facts presented.
[4] Similarly, the CFMMEU requested to be heard regarding this Application. Noting that
the content of the Trades & Services Agreement was similar in content to the Operations
Agreement, and that the two agreements were closely connected, the CFMMEU advanced it
had an interest in the matter and relied upon the discretion provided to the Commission under
s 590. I declined to exercise that discretion, having not been persuaded that the CFMMEU
had an interest, and observing that it simply proffered that the submissions filed regarding the
Operations Agreement ‘may be of assistance to the Commission in considering the approval
of the Trades & Services Agreement’.
1 [2018] FWC 211
[2019] FWC 210
DECISION
E AUSTRALIA FairWork Commission
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[5] The witness statements of Mr Damien Waller, National Human Resources Manager
(Mr Waller) and Mr Ryan Islip, Senior HR Advisor (Mr Islip) filed in AG2018/2415 were
relied upon for this Application. The Statutory Declaration of Mr Waller of 7 August 2018
(Form 17) was, in addition, relied upon concerning the pre-approval process.2
[6] Having considered the evidence and submissions, I am not satisfied that Georgiou has
complied with the requirements set out in s 180(2) and (5) of the Act, which deal with the pre-
approval steps. Therefore, as was the case with the Operations Agreement, I have concluded
that it cannot be said that the Trades & Services Agreement has been genuinely agreed.3
[7] In short, I am not satisfied that Georgiou took all reasonable steps to ensure that
employees were given access to incorporated materials during the access period, or
alternatively that the employees had access throughout the access period to a copy of such
material. Further, while an employer must take all reasonable steps to ensure the terms of the
agreement and their effect are explained in an appropriate manner taking into account the
particular circumstances of the employees, this did not occur.
[8] Therefore the application to approve the Trades & Services Agreement is dismissed.
The reasons for the decision follow.
BACKGROUND
[9] Mr Waller gave evidence that Georgiou operates a diverse range of business ranging
from fabrication of concrete products to the development of subdivisions, civil construction
and construction of multi-story buildings.4
[10] The Georgiou workforce is said to compromise of approximately 600 employees.5
Approximately, 163 employees work in the operations stream and 26 perform work in an area
referred to as the trade and services stream.6
[11] Georgiou has two enterprise agreements currently covering this workforce. The first,
the Georgiou Group (Operations) Enterprise Agreement 2014 (Old Operations Agreement)7
has a nominal expiry date of 27 May 2018, and covers the operations stream. The second, the
Georgiou Group (Trades & Services) Enterprise Agreement 2014 (Old Trades & Services
Agreement)8 covers the trades and services stream and has a nominal expiry date of 27 May
2018 (together, the Old Agreements).
[12] The Trades & Services Agreement is purported to cover tradespeople, mechanics,
crane operators, riggers, and dogging employees. Whilst the Trades & Services Agreement
2 Transcript PN623.
3 Fair Work Act 2009 (Cth) ss 186(2)(a) and 188(a)(i)
4 Witness Statement of Damien Waller (Exhibit A1) (Waller Statement) [4].
5 Ibid [5].
6 Ibid.
7 AG 2014/1008; [2014] FWCA 3494.
8 AE408332
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has national coverage, there is an exception regarding those employees to whom the Victorian
Sub-division & Minor Civil Works Agreement 2016 applies.
[13] It is apparent, given the classifications in the Classification Schedule to the Trades &
Services Agreement, that the relevant modern award was the Building and Construction
General On-site Award 2010 (Construction Award). In the Form 17, Georgiou identifies
coverage extends to the Vehicle Manufacturing, Repair, Services and Retail Award 2010
(Vehicle Award) and the Manufacturing and Associated Industries and Occupations Award
2010 (Manufacturing Award).
[14] Georgiou negotiated a replacement for the Old Trades & Services Agreement at the
same time as it negotiated the Operations Agreement. The content of the Operations
Agreement and Trades & Services Agreement (the Agreements) is, in many respects, the
same, and the bargaining meetings held, in addition to meetings to explain the terms,
notification of the vote and access period were conducted to deal with both the Agreements at
the same time. Given the content of the Agreements, and observing that the process
undertaken for both occurred at the same time, and meetings held and communications issued,
addressed both Agreements, there was no objection to hearing together the applications for the
approval of the Agreements. A hearing was conducted over the course of 1 – 2 November
with regard to both.
[15] The background to the matter was outlined at length in the Operations Decision. That
background is applicable in the circumstances of this case. Albeit, there was no evidence
before me to show that the CFMMEU had made enquiries or otherwise had some level of
involvement in the bargaining for the Trades & Services Agreement. While Messrs Waller
and Islip were cross examined in respect of the Operations Agreement, with regard to the pre-
approval steps taken there was no evidence to show that the approach differed between the
Agreements. Therefore, it is the case that I have considered their evidence when arriving at
my conclusions.
Bargaining
[16] Mr Waller’s evidence was that in May 2017, Georgiou gave notice of its intention to
make an enterprise agreement to replace the Old Trades & Services Agreement.9 Mr Waller
arranged for the Notice of Representational Rights (NERR) to be sent to the employees who
were covered by the Old Trades & Services Agreement. The first NERR was issued on
31 May 2017 and the last was issued on 8 June 2017.10
[17] By September 2017, most of the employees had appointed a Georgiou workmate to
serve as their bargaining representative.11 Mr Waller gave evidence that in January 2018,
Georgiou provided the bargaining representatives with correspondence that outlined their
responsibilities as bargaining representatives, set some dates for bargaining meetings, and
requested an agenda for the upcoming discussions.12
9 Waller Statement [7].
10 Form 17 [2.8].
11 Waller Statement [9], [17].
12 Ibid [18].
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[18] First round bargaining meetings were held with various groups of employees at
various locations on 12, 14, 19, 20, 21, and 22 of February 2018.13 The second round of
bargaining meetings were thereafter held on 19, 22, 23, 26, 27, and 28 March 2018.14
[19] Mr Waller gave evidence that the bargaining discussions came to a quick conclusion
because Georgiou were building on an agreement that had already been working well enough
for four years and there were only a few agenda items to be considered.15 As a consequence,
by the end of the second round bargaining discussions, Mr Waller believed that they had
arrived at the text of the Agreements.
[20] Between 23 April 2018 and 10 May 2018, Messrs Islip and Waller, ran a series of
roadshows to explain the terms of the Agreements to the employees.16 The roadshows were
scripted to ensure consistency in messaging.17 Mr Islip explained that the roadshows were
meetings held with those employees whose employment would be covered by the
Agreements. Mr Islip explained to the employees what the Agreements meant, and how they
would work in practice. He reported that he answered any questions that the employees had
about the Agreements.18
[21] Mr Islip provided specific detail regarding the steps taken to explain the content of the
Agreements to the employees. By way of example, in his evidence he referred to the
roadshow held at Roy Hill on 1 May 2018. At the 1 May 2018 meeting, Mr Islip stated that
once employees had arrived and signed an attendance sheet he began by reading the prepared
roadshow script.19 He asked whether any of the employees had difficulty understanding
English, or if the group knew of anyone who had such difficulty.20 There was no indication
that the group could not understand English.
[22] Once the literacy of the group had been established, Mr Islip explained that the
employees had been provided with a business card that included a QR reader code for the
Agreements.21 Mr Islip explained that he informed the group how the QR reader code worked
and that it would enable the employees to access a copy of the Agreements at a later date.22
Mr Islip confirmed that copies of the proposed Agreements would be left in the lunch rooms.23
[23] The meeting room included a large projector screen.24 Mr Islip gave evidence that on
the screen he displayed a document that compared, side by side, clause by clause, the Old
13 Ibid [21].
14 Ibid [22].
15 Ibid [23].
16 Ibid; Witness Statement of Ryan Islip (Exhibit A2) (Islip Statement) [8].
17 Islip Statement [8].
18 Ibid.
19 Ibid [15].
20 Ibid.
21 Ibid [16].
22 Ibid.
23 Ibid.
24 Ibid [17].
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Agreements next to the Agreements.25 He stepped the employees through each clause of the
Agreements and informed employees they were free to ask any questions.26 Further, Mr Islip
gave evidence that he informed the group that he would return the following week to hold the
same discussions with those employees who were on ‘R&R that morning’.27
[24] Mr Islip recalled that during discussions about the proposed Agreements, he was asked
by the employees about cashing out of annual and personal leave, the fitness for work section
regarding drug and alcohol testing, and notice periods.28 Further, questions were asked about
the pay rates as there were no guaranteed pay increases in the Agreements.29 Mr Islip’s
evidence was that he explained that the employees were paid more than the hourly minimum
pay rates that were outlined in the proposed Agreements and that such pay rates were designed
to be attractive enough to entice employees to join Georgiou and stay employed for the
project duration.30
[25] Mr Islip also explained that in the meeting he informed the employees of the process
for the vote, which would be by a secret ballot, and when this would take place (21 May
2018).31 One of the employees asked what would occur if they were away from site at the
time of the vote.32 Mr Islip gave evidence that he responded by informing the employee that
the company wold ascertain who was away and would try and contact them via email or SMS
to ensure everyone had the opportunity to vote.33
[26] In addition to the meeting held at Roy Hill on 1 May 2018, Mr Islip said he continued
on with the roadshow visiting the Tianqi Lithium Processing Plant in Kwinana 2 May 2018,
and the Precast facilities in Hazelmere on 3 May 2018.34 A follow up roadshow visit was
conducted at Roy Hill on 8 May 2018,35 and on 9 May 2018, Mr Islip said that he held a
roadshow at Talison Lithium Hydroxide Project in Greenbushes. Essentially, the same
process was undertaken as was described for the 1 May 2018 meeting.
[27] Whilst Mr Islip met with the employees at some of the Georgiou sites, Mr Waller
similarly met with those employees working at other sites. On 23 April 2018, Mr Waller said
that he conducted the roadshow for employees at Pimlico, a site in the Eastern States.36 This
was followed by the roadshow at the Telegraph Road Project in Queensland on
24 April 2018.37 Mr Waller gave evidence that he conducted further roadshows with the
Georgiou Building Team (30 April 2018), Infrastructure Department (1 and 4 May 2018),
25 Ibid.
26 Ibid.
27 Ibid [20].
28 Ibid [27].
29 Ibid [28].
30 Ibid.
31 Ibid [21].
32 Ibid [24].
33 Ibid.
34 Ibid [36], [43].
35 Ibid [58].
36 Waller Statement [25].
37 Ibid.
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Plant and Infrastructure Department (2 May 2018), and employees working on the Northern
Road Project in New South Wales on 10 May 2018.
[28] As far as the content of the abovementioned meetings were concerned, Mr Waller’s
evidence was for the most part on par with that provided by Mr Islip regarding the
explanation of the terms of the proposed Agreement, and whether the employees were literate
in English.38
[29] The meeting held with employees at Pimlico on 23 April 2018 is significant in the
context of this matter and warrants the provision of further detail. Its significance will
become apparent when consideration is given to whether Georgiou took all reasonable steps
to ensure the terms of the Agreements, and the effect of those terms, were explained to the
relevant employees.
[30] Before that meeting, Georgiou had distributed to the employees a document that was
referred to as Update Number 4.39 Update Number 4 stated:
As you know, we’ve been working with the employee bargaining representatives on two
baseline enterprise bargaining agreements (EBA [Operations and Trades & Services]) to set
out the working conditions for employees across the Georgiou Group. The agreements are
now ready to go, but we can’t implement them unless the majority of the people who will
work under each of the new agreements approve them…
The bargaining between the Employee and Georgiou representatives has been very productive
with the majority of each agreement accepted by both parties. Overall there have been
minimal changes, however some of the modifications to the Agreements include;[sic]
Annual review of rates within Pay Schedules;
Increases to various allowances (example Travel, Toll & Leading Hand Allowances);
Ability for employees to access leave without pay (LWOP) during company shut-
downs;
Making shift work payments ‘stand-alone’;
Inclusion of CW1, CW2, CW3 and CW4 classifications (Operations Agreement); and
Two simplified agreements which will help to facilitate your career development
within Georgiou Group.
[31] It was acknowledged by Mr Waller that the meeting on 23 April 2018 was, in respect
of the employees working a Pimlico, the only real opportunity for a one-on-one worker
management discussion.40 Further, it is apparent from the evidence that the road shows were
the only one-on-one meeting with employees to explain the terms of the Agreements.41
Mr Waller’s evidence was that any employees who were absent from the initial meetings were
rescheduled to attend an alternative meeting or were email the proposed agreement, EBA
Update (meaning Update Number 4), and offered the opportunity to attend a further line-by-
line explanation of the proposed agreement, at a time suitable to them.
38 Ibid [26] – [29].
39 Transcript PN180.
40 Ibid PN192.
41 Form 17 [2.6].
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[32] In cross examination concerning the Operations Agreement, specifically, the meeting
on 23 April 2018, Mr Waller was asked whether he recalled one of the employees asking how
the rates of pay operated and how they related to the employees’ existing rates. Mr Waller
responded:
Not entirely for that project. I do remember that that was one of the areas that was discussed
when we were going across a few of those discussions around those rates of pay because we
had moved away from the increase to the review period.42
…
so in response to a question from an employee at the Pimlico meeting about wanting to know
how the rates in the EBA related to the employee’s existing rates, do you recall yourself or
someone else from management side saying words to the effect of, “We can’t tell you what
your rates of pay will be because it’s an Australian wide EBA and it all depends upon where
you’re working. In some places you’ll get less, in some places you’ll get more”? In that
discussion I didn’t have anyone – there was myself in that meeting, so I wouldn’t have said it
that way. I believe – I cannot actually recall but I would’ve talked about this being a baseline
agreement, and then we also then would be looking at the rates depending on the areas you’re
located at, the market conditions, et cetera. But, like I said, I wouldn’t have said the words to
what you’re saying, I believe. I can’t exactly recall, sorry.43
[33] In Mr Waller’s cross examination regarding the operation of cl 11 of the Operations
Agreement, attention was turned to the auditing of shift payments which requires a four-
weekly audit of payments against the relevant award. When asked about the explanation
provided between cl 11 and the Construction Award, Mr Waller stated:
Were copies of the award distributed?---No.
The Construction Award?---No.
Were employees provided with any guidance or mechanism as to how they could access the
award?---No.
But the agreement actually incorporates the award by reference – I'll withdraw that. I'll try to
be a bit less technical. The agreement is in some respects dependent upon the award, isn't it?
So the auditing shift payment section actually requires employees to understand both the
award and the agreement, doesn't it not?---With that one there I went through the application
of that clause, the meaning of the clause.44
People basically just had to take your word for it that the auditing against – about what the
award might've provided; yes?---I mean, I was there to answer any questions. On that
particular one there I didn't actually receive any questions about that. I went – I was there for
the majority of these roadshow – of all the roadshows besides my colleague, Mr Ryan Islip,
and I didn't get questions on that part.
[34] In his witness statement, Mr Waller refers to Georgiou having conducted a secret
ballot from 21 May 2018 to 23 May 2018.45 The result of the ballot was that 22 employees
42 Transcript PN186.
43 Ibid PN189.
44 Ibid PN201 – 205.
45 Waller Statement [31].
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voted to approve the Trades & Services Agreement, and 22 voted not to approve it.46 In cross
examination, Mr Waller conceded that the vote that had been conducted at Pimlico was not
conducted how Georgiou expected it to be conducted and site management were instructed to
go and redo the vote.47 Mr Waller confirmed there were no further irregularities regarding
voting at other sites.
APPROVAL OF ENTERPRISE AGREEMENT
Uncertain scope
[35] The Commission had informed Georgiou that there was an issue with cl 1 of the
Trades and Services Agreement, which stated:
This Agreement applies to Employees engaged in work described in the classifications in the
Classification Schedule of this agreement, except that it does not apply to any Employee to
whom the Victorian Sub-division & Minor Civil Works Agreement 2016 applies.
Georgiou may enter into site-specific agreements as required, and if a site specific agreement
is made this agreement does not apply to any employees working on that site.
[36] Clause 1 appeared contrary to s 58, specifically s 58(2), which prescribes when an
enterprise agreement does or does not apply to an employee. Section 58(2) sets a general rule
which provides that when more than one agreement could apply to an employee in relation to
particular employment, the earlier in time agreement would apply unless and until that earlier
agreement passes its nominal expiry date. In short, the general rule is one that determines
which of an earlier and later agreement, both of which are expressed to cover a particular
employee, apply at each particular time.48
[37] In the High Court decision in Aldi Foods Pty Limited v Shop, Distributive & Allied
Employees Association (Aldi),49 it was observed, that the Act contemplated that while more
than one agreement could cover employees at one particular time, only one could apply.
Clearly then a difference in meaning must exist between the two terms. The High Court
clarified that the terms ‘coverage’ and ‘application’ were not synonymous, and drew upon the
distinction that had been deliberately drawn by the inclusion of ss 52 and 53.
[38] Section 52 refers to when an enterprise agreement applies. It provides:
When an enterprise agreement applies to an employee, employer or organisation
(1) An enterprise agreement applies to an employee, employer or organisation if:
(a) the agreement is in operation; and
(b) the agreement covers the employee, employer or organisation; and
(c) no other provision of this Act provides, or has the effect, that the agreement
does not apply to the employee, employer or organisation.
46 Form 17 [2.10].
47 Transcript PN346 – 347.
48 Construction, Forestry, Maritime, Mining and Energy Union v CPB Contractors Pty Limited [2018] FWCFB 5773 [15].
49 [2017] HCA 53.
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Enterprise agreements apply to employees in relation to particular employment
(2) A reference in this Act to an enterprise agreement applying to an employee is a
reference to the agreement applying to the employee in relation to particular
employment.
[39] Section 52(1)(b) makes it clear that a condition of an agreement applying to an
employee or employer is that it must cover them.
[40] Section 53(1) addresses coverage by providing that an enterprise agreement covers an
employee or employer, if the agreement is expressed to cover (however described) the
employee or employer.
[41] As observed, s 58(1) specifies that only one enterprise agreement can apply to an
employee at a particular time. The significance of an enterprise agreement applying to a
person is set out in s 51, which states:
(1) [Enterprise agreement enforceable only if applicable]
An enterprise agreement does not impose obligations on a person, and a person does
not contravene a term of an enterprise agreement, unless the agreement applies to the
person.
(2) [Entitlements available only if applicable]
An enterprise agreement does not give a person an entitlement unless the agreement
applies to the person.
[42] However, as has been acknowledged there will be occasions where coverage is
provided by two enterprise agreements. To determine the priority of the enterprise
agreements, we arrive back at s 58(2), which conveniently sets out the general rule as follows:
If:
(a) an enterprise agreement (the earlier agreement) applies to an employee in relation
to particular employment; and
(b) another enterprise agreement (the later agreement) that covers the employee in
relation to the same employment comes into operation; and
(c) subsection (3) (which deals with a single-enterprise agreement replacing a multi-
enterprise agreement) does not apply;
then:
(d) if the earlier agreement had not passed its nominal expiry date:
(i) the later agreement cannot apply to the employee in relation to that
employment until the earlier agreement passes its nominal expiry date;
and
(ii) the earlier agreement ceases to apply to the employee in relation to that
employment when the earlier agreement passes its nominal expiry date,
and can never so apply again; or
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(e) if the earlier agreement has passed its nominal expiry date – the earlier agreement
ceases to apply to the employee when the later agreement comes into operation,
and can never so apply again.
[43] In the decision of CPB Contractors the clause under consideration provided that ‘a
later enterprise agreement approved by the Commission will cover CPB and its employees at
a particular project or site “to the exclusion of this Agreement”’.50 With regard to the
offending clause, the Full Bench observed that the provision was one premised on the
proposition that such a project or site would be one that fell within the coverage of the
‘Agreement’ in question and hence the rationale for the inclusion of the provision was to
resolve a situation of dual coverage.51 The Full Bench continued:
The final paragraph purports to exclude the coverage of the Agreement (being the earlier
agreement) in favour of the later agreement for specific project or site. As earlier explained,
an agreement cannot apply to employee unless it covers them. The intended effect of the final
paragraph of clause 3.3 is therefore that the later agreement will apply and the Agreement will
not at the specific project or site in question. While the Agreement remains within its nominal
term, that is a result which is directly contrary to that mandated by s 58(2).52
[44] It was found by the Full Bench that the offending clause was a mechanism for the
making and approving of a new project or site/specific enterprise agreement as a means by
which CPB and a subset of employees covered by the enterprise agreement in question may
cease to be covered before its nominal expiry date. The Full Bench in CPB Contractors
found that the offending clause was rendered unlawful by the operation of s 194(ba). That
section states:
194 Meaning of unlawful term
A term of an enterprise agreement is an unlawful term if it is:
…
(ba) a term that provides a method by which an employee or employer may elect (unilaterally
or otherwise) not to be covered by the agreement.
[45] As a consequence, the Full Bench concluded that there could not be the requisite
satisfaction under s 186(4) because the enterprise agreement contained an unlawful term.
[46] Unlike the case of CPB Contractors where the offending clause provided that ‘a later
enterprise agreement approved by the Commission will cover CPB and its employees at a
particular project or site “to the exclusion of this Agreement”’, the Trades & Services
Agreement speaks to it not applying if a site specific agreement is made.
[47] The first part of the second paragraph of cl 1 in the Trades & Services Agreement is
unproblematic; it simply states that Georgiou may enter site-specific agreements. However,
the second part of the second paragraph uses language that indicates that an enterprise
50 Construction, Forestry, Maritime, Mining and Energy Union v CPB Contractors Pty Limited [2018] FWCFB 5773 [16]
(CPB Contractors) (emphasis added).
51 Ibid.
52 Ibid (emphasis in original).
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agreement not yet in contemplation, if made, would apply to the employees working on the
site rather than the Trades & Services Agreement. That is, an enterprise agreement made in
the future would apply to the employees and employer notwithstanding that the clause makes
no reference to the Trades & Services Agreement first passing its nominal expiry date. The
clause therefore operates in a manner that is contrary to the general rule set outlined in
s 58(2)(d)(i).
[48] While in CPB Contractors the Full Bench was able to arrive at a position that the term
was unlawful due to its inconsistency with s 194(ba), it is the case that such a conclusion
cannot be so easily reached in this matter. Section 194(ba) speaks directly to a term providing
a method by which an employee or employer may elect, unilaterally or otherwise, not to be
covered by the agreement. The Trades & Services Agreement does not remove its coverage,
but for a set of employees working on the relevant site, it removes its application. In short, it
includes a means by which an employee or employer may elect not to have the Trades &
Services Agreement apply.
[49] Aldi informed us that the terms ‘cover’ and ‘apply’ were not synonymous. And yet,
the mischief that the insertion of s 194(ba) sought to address in 2012, appears to have been
frustrated by the use of the phrase ‘does not apply’ rather than ‘not be covered’.
[50] By way of reference, s 194(ba) was inserted into the Act to provide that a term of an
enterprise agreement that would enable an employee or an employer to ‘opt out’ of coverage
of the agreement is an unlawful term.53 The amendment responded to the recommendation
made by the three member panel who had reviewed the Act to assess its operation in light of
its objects.54 Recommendation 23 provided that the Act be amended to prohibit enterprise
agreement clauses which permitted employees to opt out of the agreement. Various reasons
were cited why ‘opting out’ clauses were a cause for concern, including the potential for new
and existing employees to feel pressured to opt out of such agreements, thereby relinquishing
legitimate rights and entitlements.
[51] Of course, it is the case that if coverage is excluded, it necessarily follows that the
enterprise agreement cannot apply to the employee or employer by operation of s 52. The
repercussion being that it is the application of that enterprise agreement to the employee that
entitles that employee to the benefits provided by it.55 It has been previously said that where
one interpretation will result in injustice and another avoid it, then the latter is to be
preferred.56 Interpretation by reference to the consequences of adopting a particular
construction is an incident of the purposive approach to interpretation.57
[52] I am satisfied that the intended effect of the second paragraph of cl 1 is that if a later
agreement is made, namely a ‘site specific agreement’ then, notwithstanding that the Trades
& Services Agreement applies to those employees, if they work on the site for which a new
53 Explanatory Memorandum, Fair Work Amendment Bill 2012 (Cth) [140].
54 Ron McCallum, Michael Moore, and John Edwards, ‘Towards more productive and equitable workplaces: an evaluation of
the Fair Work legislation’ (Report, Fair Work Review, 15 June 2012), 161.
55 Fair Work Act 2009 (Cth) s 51.
56 Ms Delwyn Hewitt v Topero Nominees Pty Ltd T/A Michaels Camera Video Digital [2013] FWCFB 6321 [43].
57 Turner v George Weston Foods Ltd Trading as Tip Top Bakeries [2007] NSWCA 67 [56] cited in Ms Delwyn Hewitt v
Topero Nominees Pty Ltd T/A Michaels Camera Video Digital [2013] FWCFB 6321 [44].
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agreement has been made, the Trades & Services Agreement will no longer apply. While the
Trades & Services Agreement remains within its nominal term, such a result is directly
contrary to that mandated by s 58(2).
[53] The second paragraph of cl 1 is effectively a method by which the employees and
employer can elect not to be covered by the Trades & Services Agreement. While the clause
specifically refers to ‘does not apply’, the effect on the employees would be the same were the
clause to read ‘does not cover’. Therefore, I have found that the term is one that is unlawful
as understood by reference to s 194(ba) and as a consequence, as was the case in CPB
Contractors, I am not satisfied that the Trades & Services Agreement does not include any
unlawful terms.
[54] However, if I am wrong in reaching the conclusion that the second paragraph of cl 1 is
contrary to s 194(ba), it remains the case that I consider that the second paragraph in cl 1
offends s 58(2)(d)(ii). Accordingly, to the extent that a term in an enterprise agreement
purports to determine the priority of enterprise agreements inconsistently with that general
rule under the Act, then I consider that the term is of no legal effect.
[55] Whether the requirement set out in s 186(4) cannot be satisfied because of the
inclusion in the Trades and Services Agreement of cl 1 the second paragraph, or because such
paragraph is of no legal effect, does not necessitate in these circumstances the dismissal of the
Application. So much is clear from CBP Contractors. If an undertaking were to be proffered,
such as an undertaking to remove or treat of no effect the offending cl 1 second paragraph, it
would merely remove a method by which Georgiou and a subset of employees could at some
future time opt out of the Trade and Services Agreement’s application.
Genuinely agreed
[56] While I have found that cl 1 does not necessitate the dismissal of the Application, I am
of the view nonetheless that the Application must be dismissed because the Trades & Services
Agreement has not been genuinely agreed. An enterprise agreement is genuinely agreed if the
Commission is satisfied that, among other subsections, s 180(2) and 180(5) are complied
with. I am not satisfied this is the case for the reasons that follow.
[57] Section 186 sets out the circumstances in which the Commission must approve an
enterprise agreement. It is a long section but for the purpose of this part it is suffice to say the
enterprise agreement must be genuinely agreed to by employees covered by the enterprise
agreement, must not contravene s 55 of the Act regarding the National Employment Standards
(NES), and must pass the better off overall test (BOOT).
[58] ‘Genuinely agreed’ takes its meaning from s 188. This section sets out the following:
188 When employees have genuinely agreed to an enterprise agreement
An enterprise agreement has been genuinely agreed to by 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);
[2019] FWC 210
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(ii) subsection 181(2) (which requires that employees not be requested to approve
an enterprise agreement until 21 days after the last notice of employee
representational rights is given); and
(b) the agreement was made in accordance with whichever of subsection 182(1) or (2) applies
(those subsections deal with the making of different kinds of enterprise agreements by
employee vote); and
(c) there are no other reasonable grounds for believing that the agreement has not been
genuinely agreed to by the employees.
[59] The term is expressed in a way that requires the Commission to satisfy itself of the
employer’s compliance with particular bargaining provisions within the Act (ss 188(a) and
(b)), and satisfaction of a more general criterion in s 188(c) of the Act.58 It is not simply a
general consideration whether in all of the circumstances of a particular enterprise agreement
the member is satisfied that the enterprise agreement has been genuinely agreed to.59
[60] In the decision of Ostwald Bros Pty Ltd v Construction, Forestry, Mining and Energy
Union (Ostwald), the Full Bench stated the specific requirements in s 188(a) of the Act were:
Section 180(2) of the Act: The employer must take all reasonable steps to ensure that
during the access period for the agreement, “the employees employed at the time who will
be covered by the agreement are given a copy” of the agreement and “any other material
incorporated by reference in the agreement” or “have access, throughout the access period
for the agreement, to a copy of those materials.”
Section 180(3) of the Act: “The employer must take all reasonable steps to notify the
relevant employees” of the “time and place at which the vote will occur” and the voting
method by the start of the access period for the agreement.
Section 180(5) of the Act: The employer must take all reasonable steps to ensure that the
terms of the agreement and their effect are explained to the relevant employees, “in an
appropriate manner taking into account the particular circumstances and needs of the
relevant employees.”
Section 181(2) of the Act: the request by the employer of the employees employed at the
time who will be covered by the agreement to approve the agreement by voting for it
“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.60
[61] Section 188(b) refers to the requirement that the Commission must be satisfied that the
enterprise agreement must be made in accordance with, in the circumstances of this case,
s 182(1) of the Act. This subsection provides if the employees of the employer who will be
covered by a proposed enterprise agreement have been asked to approve the enterprise
agreement under s 181(1) the enterprise agreement is made when a majority of those
employees who cast a valid vote approve the enterprise agreement.
58 Ostwald Bros Pty Ltd v Construction, Forestry, Mining and Energy Union [2012] FWAFB 9512 [52].
59 Ibid [78].
60 Ibid [54].
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[62] Section 188(c), although itself a broad discretionary consideration, is an additional
matter about which the Commission needs to be satisfied and relates to grounds other than
those arising in relation to ss 188(a) and (b) matters as indicated by the expression ‘other
reasonable grounds’.61
[63] In KCL Industries Pty Ltd (KCL),62 the Full Bench examined the requirement of
‘genuinely agreed’ in the context of s 188(c) of the Act. It traced its origin, referred to the
Explanatory Memorandum to the Fair Work Bill 2008, traversed the analysis of s 188 in the
decision of the Full Bench in Ostwald, and by the Deputy President in Central Queensland
Services Pty Ltd (Central Queensland).63 In short, the Full Bench in KCL agreed with, and
adopted, the majority analysis in Ostwald, and the analysis of the Deputy President in Central
Queensland. I intend to do the same.
[64] Of particular relevance to this matter are the decisions of the Federal Court in
Construction, Forestry, Mining and Energy Union v Australian Industrial Relations
Commission (Gordonstone),64 and Grocon Pty Ltd Enterprise Agreement (Victoria)
(Grocon),65 both of which are referred to in KCL.
[65] In Gordonstone the Full Court considered the operation of s 170LT(6) of the
Workplace Relations Act 1996 (Cth) (WR Act). This section provided that ‘a valid majority
of persons employed at the time whose employment would be subject to the agreement must
have genuinely made the agreement’. The Full Court considered the subsection against the
backdrop of the principal object of the WR Act. That object was to provide a framework for
cooperative workplace relations by, amongst other things, supporting fair and effective
agreement making.
[66] The Full Court found that the subsection was plainly a sign or indication of the
concern with the authenticity and, as it were, the moral authority of the certified agreement.
While Gordonstone considered the term ‘must have genuinely made’ subsequent decisions of
the Commission have continued to adopt its analysis when considering s 188(c) of the Act.
The objects of Part 2-4 still speaks of a fair framework albeit ‘simple’ and ‘flexible’ have
been added to the mix, as has the end product of an enterprise agreement being that it delivers
productivity benefits.
[67] Ross VP, as he then was, considered Gordonstone in Grocon and went on in Grocon
to quote the observations he had made in Re Toys “R” Us (Aust) Pty Ltd Enterprise
Flexibility Agreement 1994 regarding an application to approve an enterprise flexibility
agreement under a different statutory regime.66 Those observations were:
In my view the requirement that a majority of employees “genuinely agreed” to be bound by
the agreement implies that the consent of the employees was informed and there was an
absence of coercion.
61 Fair Work Act 2009 (Cth) s 188(c).
62 [2016] FWCFB 3048.
63 [2015] FWC 1554.
64 [1999] FCA 847.
65 (2003) 127 IR 13.
66 Print L9066.
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Given the conclusion I have reached in relation to s 170NC(1)(h) it follows that I do not
believe that the majority consent in this case was informed. The material supplied by the
company to the employees did not fully disclose the impact of the agreement…
67
[68] In Grocon, Ross VP drew upon the decision in Coles Supermarkets Australia Pty Ltd v
Shop, Distributive and Allied Employees Association where the Full Bench of the Australian
Industrial Relations Commission said:
…The need to explain the terms of the agreement is both an explicit requirement of
ss. 170LJ(3) and is implied in the concept of “genuine approval”. “Genuine” approval implies
that the consent of the employees was informed, that they were advised of the consequences of
giving their approval to the agreement.68
[69] When determining whether there are no other reasonable grounds for believing that the
enterprise agreement has not been genuinely agreed to, consideration of the authenticity of the
enterprise agreement, its soundness,69 and whether the employees who will be covered by the
enterprise agreement are informed of its terms so it can be said that their ‘consent’ is
informed, are relevant considerations.
[70] The use of the word ‘genuinely’ in the phrase ‘genuinely agreed’ in ss 186(2)(a) and
188(c) of the Act indicates that mere agreement will not suffice and that consent of a higher
quality is required.70
[71] Paragraph 188(c) is cast in very broad terms.71 It is intended to pick up anything not
caught by paras (a) and (b).72 Thus, any circumstance which could logically bear on the
question of whether the enterprise agreement of the relevant employees was genuine would be
relevant.73
Explanation of the effect of the terms of the enterprise agreement
[72] Section 188 provides that an enterprise agreement has been genuinely agreed to by the
employees covered by the enterprise agreement if the Commission is satisfied that the
employer has complied with requirements set out in that section, including that in s 180(5).
[73] Further, s 180(1) requires that before an employer requests employees to approve an
enterprise agreement by voting for it, the employer must comply with requirements including
the requirement at s 180(5) that:
The employer must take all reasonable steps to ensure that:
67 (2003) 127 IR 13.
68 Print T2319 [20].
69 See Central Queensland Services Pty Ltd T/A BHP Billiton Mitsubishi Alliance [2015] FWC 1554 [65]; Ostwald Bros Pty
Ltd v CFMMEU [2012] FWAFB 9512 [154]; KCL Industries Pty Ltd [2016] FWCFB 3048 [29].
70 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [141].
71 Ibid [142].
72 Ibid.
73 Ibid.
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(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.
[74] The issue at the heart of the requirement in s 180(5) is to ensure genuine and informed
consent to the terms of the proposed enterprise agreement.74
[75] Whether s 180(5) has been complied with involves an evaluative judgment.75 This is
because the Commission must assess whether ‘reasonable steps were taken by the
employer’.76 What steps may be necessary will depend upon the facts and circumstances of
each particular case; but it has been found that those steps are not satisfied by a person
reading – without explanation – the terms of an enterprise agreement to an employee.77
[76] In One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union
(One Key),78 Flick J found that ‘reasonable steps’ could include the identification of the
particular award which covered the relevant employees with particular reference to those
provisions in the award that varied from, or did not vary from, the terms of the proposed
enterprise agreement. It is relevant to observe that Flick J was proffering suggestion on what
steps could have been taken to constitute ‘all reasonable steps’ in the circumstances of that
particular case.
[77] On appeal, in One Key Workforce Pty Ltd v Construction, Forestry, Mining and
Energy Union (One Key Full Court Decision),79 the Full Court found that a bare statement
by an employer that an explanation had been given was an inadequate foundation upon which
to reach a state of satisfaction for the purpose of s 180(5) of the Act. The Full Court said that
the relevant considerations to which the Commission was bound to have regarded, was the
content of the explanation provided and the terms in which it was conveyed.80 The Full Court
went on to say:
The agreed purpose of the obligation imposed on employers by s 180(5) is to enable the
relevant employees to cast an informed vote: to know what it is they are being asked to agree
to and to enable them to understand how wages and working conditions might be affected by
voting in favour of the agreement.81
…
To construe that requirement as mandating an informed and genuine understanding of what is
being approved is consistent with the text of the provision (as defined) and accords with its
underlying purpose.82
74 Coles Supermarkets Australia Pty Ltd v Shop, Distributive and Allied Employees Association Print T2319 [20].
75 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [105].
76 Ibid.
77 Ibid [103].
78 [2017] FCA 1266 [105].
79 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [112].
80 Ibid.
81 Ibid [115].
82 Ibid [156].
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[78] The emphasis in the One Key Full Court Decision was on the employee’s
understanding of the terms and conditions provided in the enterprise agreement and their
effect. Regard must therefore be had to the content and terms of the explanation the employer
provided to the employees before they cast their votes. In addition, in determining whether
the relevant employees had genuinely agreed to the enterprise agreement, the Commission
must consider whether the relevant employees were likely to have understood its terms and
effect.83
[79] The term ‘reasonable’ is usually considered within the context of ‘reasonable in all of
the circumstances of the case’, and the real question is to determine what circumstances are
relevant.84
Consideration
[80] It was evident through Mr Waller’s evidence that the Trades and Services Agreement
provided minimum hourly rates of pay, or, as was termed by Mr Waller, was a ‘baseline
agreement’.85 This observation by Mr Waller accords with the cl 10 of the Trades and
Services Agreement that provided ‘Georgiou will pay each Employee a minimum of the
Hourly Rates set out in the Pay Schedule’, and the Update Number 4.
[81] As a ‘baseline agreement’, it can be concluded that the terms and conditions within the
Trades and Services Agreement set the minimum terms and conditions that would otherwise
have been provided by the relevant modern award or perhaps the NES. I have observed that
given the classifications in the Classification Schedule to the Trades and Services Agreement,
at a minimum the Construction Award was the relevant modern awards. Georgiou also
references the Vehicle Award and the Manufacturing Award.
[82] While the Trades and Services Agreement in effect set the new ‘baseline’, it is not
apparent that the relevant employees were provided with any information on the differential
between the rates of pay in the relevant modern awards and the Trades and Services
Agreement. Further, the employees were not provided with access to the relevant modern
awards, whether via the provision of an email hyperlink, attachment or hard copy version of
the relevant modern award.
[83] At cl 10 the Trades and Services Agreement an obligation is placed upon Georgiou to
review ‘the rates of pay whenever the Award rates are varied to ensure that Georgiou
continues to pay employees at above the Award rates’. While the word ‘Award’ is capitalised
it is not defined and therefore the particular modern award cannot be ascertained from the
Trades and Services Agreement.
[84] Similarly, at cl 11, reference is made to the ‘modern award’ in the context of Georgiou
conducting ‘4-weekly audits of all payments to any Employee who undertakes shift work to
confirm that it has paid the relevant Employee at least 104% of the amount that he or she
would have earned had the modern award that covers that work, applied.’ It is not clear from
83 Ibid [172].
84 Opera House Investment Proprietary Limited v Devon Buildings Pty Ltd (1936) 55 CLR 111, 116.
85 Transcript PN189.
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the content of the Trades and Services Agreement what the relevant modern award is, or what
the rates of pay under that modern award are for shift work.
[85] Under the Trades and Services Agreement, Trainee Employees are paid under cl 10.2
at ‘the rate set out in any award that, but for this Agreement, would have applied to that
Employee’s employment’. Apart from the obvious of issue of how such benefit renders the
Trainee Employee better off overall, again the question looms how the relevant employees
knew what the rate of pay was set out in the modern award, and which modern award was
relevant.
[86] When Mr Waller provided his evidence he appeared to be quite candid when asked
about the accessibility the employees had to the Construction Award. Mr Waller conceded
that copies of the award were not distributed and the employees. Further he acknowledged
that the employees were not provided with any guidance or mechanism as to how they could
access the Construction Award. There was no evidence that suggested employees were
referred to the Vehicle Award or Manufacturing Award.
[87] I observed that in One Key, ‘reasonable steps’ could include the identification of the
particular modern award which covered the relevant employees with particular reference to
those provisions in the modern award that varied from, or did not vary from, the terms of the
proposed enterprise agreement.
[88] An approach where comparisons are drawn with the relevant modern award will not
always be necessary to conclude ‘all reasonable steps’ were taken to ensure the effect of the
terms were explained to the relevant employees. What constitutes ‘reasonable steps’ may
depend on the circumstances of the employees and whether they were likely to have
understood the terms of the enterprise agreement and their effect, particularly with regard to
their personal interests.
[89] There was no evidence before me to show that the employees had knowledge about
the modern awards in question, or that they were sufficiently positioned to ask questions
about the terms of the proposed Trades & Services Agreement and how the terms differed to
those of the ‘modern awards’. There was no mention made in the evidence that comparisons
had been drawn concerning the rates of pay in the Trades and Services Agreement when
compared to the relevant modern awards, and that this information had been imparted to the
employees. Further, evidence concerning the explanations provided regarding audit and
reimbursement in cl 11 were in my view deficient. In summary, there was no evidence before
me to show that the relevant employees were informed of the rates of pay they would
otherwise receive under a modern award, or when working shift work, what 104% of the
amount earned under the modern award actually amounted to in monetary terms. Therefore,
in my view, it cannot be said that their consent was informed.
[90] Mr Waller’s evidence, was that when questioned about the rates of pay while he could
not actually recall what was said, he ‘would’ve talked about this being a baseline agreement,
and then we also then would be looking at the rates depending on the areas you’re located at,
the market conditions, et cetera.’86
86 Ibid.
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[91] In circumstances where a ‘baseline agreement’ is proposed, it is entirely conceivable
that all reasonable steps would include that the effect of the terms on the relevant employees
personal interests would be explained by reference and comparison to the instrument that
otherwise would set the baseline. In this case that would be at a minimum the Construction
Award. This is clearly more the case when the proposed Trades and Services Agreement
expressly references a ‘modern award’ or ‘Award’ and yet there is no evidence to show that
the employees were provided with accessibility to the same or provided with an explanation.
[92] I am not satisfied that in the circumstances of this case that the impact on the
employees’ interests was clearly addressed by Georgiou’s explanations in its discussions with
the employees. Mr Islip and Mr Waller went through the Trades and Services Agreement
explaining its terms by adopting a line by line approach, which is acknowledged. I am of no
doubt that they endeavoured to provide at least one opportunity of a face to face meeting with
a group of employees who were geographically widespread. However, what constituted all
reasonable steps in the circumstances of this matter where a ‘baseline agreement’ was
proposed, and an award or awards were referenced within the same, was at the very least
information on what the relevant modern awards were, and an explanation as to how the rates
of pay compared to those baseline rates in the Trades and Services Agreement, and
explanation on the operation of cl 11 reconciliation and the rates of pay for Trainee
Employees.
Access to materials
[93] Section 180(2)(a) requires an employer to take all reasonable steps during the access
period to ensure that employees are given a copy of material incorporated by reference in the
proposed agreement. In the alternative the employer is required to ensure that the relevant
employees have access throughout the access period to a copy of those materials.87
[94] Provision of accessibility to legislation that is incorporated by reference into an
agreement was considered in McDonald’s Australia Pty Ltd; Shop, Distributive and Allied
Employees’ Association88 (McDonalds). McDonalds was later considered in Construction,
Forestry, Mining and Energy Union v Sparta Mining Services Pty Ltd (Sparta).89 In
McDonalds, the Full Bench concluded that whilst long service leave legislation had been
incorporated into the agreement by reference, the employer was not required to take any
further steps to ensure employees had access to such legislation, as the laws of the land were
available to Australian citizens. In Sparta, the Full Bench stated:
[22] We consider the above passage is to be read on the basis that the Full Bench took judicial
notice of the fact that legislation, including South Australian legislation, is readily available to
citizens in a number of ways (most notably on the internet), and therefore presumed for the
purpose of s.180(2)(b) that it was accessible to employees during the access period. However
it must be noted that the subsequent Full Bench decision in National Tertiary Education
Industry Union v University of New South Wales left open the possibility that paragraph [43]
of McDonalds above may not be universally applicable, but rather that “that there may be
cases where the characteristics of the workplace and the composition of the workforce may
require more than what that Full Bench indicated was adequate”. We further note that
87 Fair Work Act 2009 (Cth) s 180(2)(b).
88 [2010] FWAFB 4602.
89 [2016] FWCFB 7057.
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McDonalds did not explain how the mere availability of material in the public domain meant
that there was no reasonable step at all which the employer could have taken to ensure access
to a copy of the material.
[95] In short, it was not the case that Sparta overruled McDonalds, but the Full Bench
found that what constituted all reasonable steps under section 180(2) of the Act ‘will depend
on the circumstances’.90 In National Tertiary Education Industry Union v University of New
South Wales the Full Bench stated:
We are not persuaded a sufficient argument has been made out to revisit the approach taken in
McDonalds. We do acknowledge however that there may be cases where the characteristics
of the workplace and the composition of the workforce may require more than what that Full
Bench indicated was adequate. This is not such a case.91
[96] In the decision of BGC Contracting Pty Ltd, the Deputy President distinguished
between the two limbs in s 180(2) on the following basis:
The difference between the two methods of complying with the preapproval step in s.180(2) is
that the first is concerned with each employee having possession of a copy of an enterprise
agreement and any incorporated material. The giving may occur at any time during the access
period, although the reasonable steps directed to ensuring that relevant employees are “given”
the materials may be taken both before and during the access period. The second is concerned
with enabling each employee to have access to an enterprise agreement and any incorporated
material. Access to an enterprise agreement and any incorporated material need not involve
physical possession of the documents and so would encompass for example, an employer
leaving copies of such documents in a staff room or other area where employees are able to
gather and can review the documents. In these circumstances, the access must be arranged by
the start of the access period and employees must have access to the documents throughout the
period. It seems to follow that the reasonable steps directed to achieving the end in s.180(2)(b)
must be taken before the access period begins.92
[97] It is more likely than not that Georgiou discharged its obligation under s 180(2) vis-à-
vis the Trades and Services Agreement. Georgiou purported to give each employee a copy of
the Trades and Services Agreement via use of a QR code (utilising scanning software on a
phone to access the Trades and Services Agreement) or website, and a copy was to be
provided in crib rooms.
[98] In light of clause 10.2, I am of the view that the Trades and Services Agreement
‘incorporates the award by reference’. Clause 10.2 states:
Trainee Employees
Georgiou will pay each Trainee Employee at the rate set out in any award that, but for this
Agreement, would have applied to that Employee’s employment.
[99] While it is not the case that the Trades and Services Agreement adopts express
language stipulating that an award or awards are incorporated by reference into the Trades
and Services Agreement, the language in cl 10.2 imposes an obligation on Georgiou to pay
90 CFMEU v Landlease Engineering Pty Ltd [2017] FWCFB 4001.
91 (2011) 201 IR 244 [24]; [2011] FWAFB 5163 [24].
92 [2018] FWC 1466 [40].
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each Trainee at the rate set out in any award that otherwise would have ‘applied to the
Employee’s employment’. This provision is not advisory. That is, the clause does not simply
advise the Trainee Employees the amount of their pay. Rather, the use of the word ‘will’
within the framework of the sentence sets out an obligation to an entitlement, and that
entitlement is a particular rate of pay.
[100] Georgiou did not, during the access period, give relevant employees a physical copy of
‘any award’ or for the matter the Construction Award. Nor has Georgiou identified any step
to provide access to such award as set out in s 180(2)(b). As acknowledged by Mr Waller, the
employees were not provided with any guidance or mechanism as to how they could access
the awards.
[101] At least some of the employees in question were working at a remote location.
Mr Waller’s evidence regarding the employees at Pimlico was:
Just taking the Pimlico workers, they are blue collar workers working on road gangs in fairly
distant regional locations, aren't they?---I think it's – from memory, it's a – yes, I think three-
and-a-half hours out of Brisbane I do believe, when I went there.93
[102] I consider that nothing much turns on whether an employee is a ‘blue collar’ or ‘white
collar’ employee in the context of such consideration. I am unable to draw a distinction
between a ‘blue collar’ and ‘white collar’ employee in respect of technological literacy in
circumstances where there are no facts before me to suggest such distinction is warranted.
Further, there was no evidence that justified a finding that wifi access was limited or internet
services were otherwise inaccessible. When asked about access to the internet and access to
the Operations Agreement, Mr Waller responded:
These are not office workers who would commonly have access to a computer and Wi-Fi and be
able to sort of google their way through to finding the award, are they?---No. I mean, I – we
went through and used QR Readers and URLs and all that, and offered to give hard copies and
everyone – we got very few people who actually asked for any information. They were very –
they were fine with using computers or iPhones or phones to actually get any – to get that
information, so - - -94
[103] However, while Mr Waller gave evidence that all were fine with using computers or
iPhones or phones, he readily conceded that the employees were not invited or provided with
guidance as to how to access the Construction Award.95
[104] I appreciate that the terms of the Trades and Services Agreement were landed
relatively quickly, because, according to Mr Waller, Georgiou were building upon the Old
Agreements that had been working well enough.96 It was Mr Waller’s evidence in respect of
the Old Operations Agreement, he had drawn comparisons it because ‘a lot of our employees
are long-term employees’.97 However, there was no evidence before me to shed light on
whether all relevant employees had longevity with the business. Further, there was no
93 Transcript PN206.
94 Ibid PN208.
95 Ibid PN212.
96 Waller Statement [23].
97 Transcript PN194.
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evidence that suggested employees were positioned to understand which modern award
covered them, and employees were not provided with guidance on how to access those
particular awards.
[105] While I appreciate that modern awards are available in the public domain, it is the case
that before accessing them a person must appreciate which particular modern award covers
them. Unlike legislation that generally applies to all, a modern award is limited in its
coverage. Both an employer and employee must appreciate whether they fall within the remit
of its coverage. Otherwise there is simply no utility in considering an award which has no
coverage in such circumstances. There was no evidence before me that showed the
employees were aware of the award that covered them. In the circumstances of this matter
this is particularly important in light of cl 10.2.
[106] I am not satisfied Georgiou took all reasonable steps in accordance with s 180(2). It
follows that I am not satisfied that the Trades and Services Agreement has been genuinely
agreed to by the employees covered by it.98
Valid vote
[107] In his evidence Mr Waller spoke to the irregularity that occurred at the Pimlico site
regarding the vote. He expressed that the vote at Pimlico was not conducted how Georgiou
expected it to be, and site management were instructed to go and redo the vote.99 There was
no evidence to suggest that the irregularity that had occurred eventuated elsewhere. In the
circumstances, I do not consider that the vote undertaken for the Trades and Services
Agreement was invalid.
Contraventions of section 55
[108] Section 55 contains the interaction rules between the NES and a modern award or
enterprise agreement, and relevantly provides that an enterprise agreement must not exclude
the NES or any provision of the NES.
[109] Section 186(2)(c) provides one of the requirements which must be satisfied in order
that an enterprise agreement may be approved; namely that the Commission be satisfied that
the terms of the agreement do not contravene s 55. For the purpose of s 186(2)(c), a term or
terms of an enterprise agreement will contravene s 55(1) if that term or those terms exclude
the NES or a provision of the NES. If one or more terms of an enterprise agreement are
ancillary or incidental to the operation of an entitlement under the NES or supplement the
NES, such term or terms will contravene s 55(4) if the effect of that term or those terms is
detrimental to an employee in any respect when compared to the NES.100
[110] The Commission brought to Georgiou’s attention that there were issues with several
terms in the Trades & Services Agreement where the terms appeared to contravene the NES.
Some of those issues included, but were not limited to, those that follow.
98 Fair Work Act 2009 (Cth) s 188(a)(i).
99 Transcript PN346 – 347.
100 CFMEU v CSRP Pty Ltd [2017] FWCFB 2101 [33].
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Long service leave
[111] Clause 19 deals with long service leave and whilst providing that employees are
entitled to long service leave in accordance with the applicable legislation in the jurisdiction
where the employee is employed, it excludes employees employed on a casual basis. I am
satisfied that an appropriately drafted undertaking would remedy this issue if proffered.
Annual leave
[112] Clause 16 addresses the provision of annual leave, and included within the clause is
the ability for employees to cash out annual leave. However, unlike the NES there are no
safeguards concerning the amount of leave that may be cashed out in a 12 month period, and
there are issues regarding the absence of reference to a separate agreement as provided in the
relevant award.
Parental leave and community service leave
[113] Contrary to the Act, cl 20 purports to exclude casual employees from accessing
parental leave, and cl 21 similarly does the same with regard to community service leave. As
has been identified with other clauses contravening the NES, the issues could be remedied
with appropriately worded undertakings.
Abandonment and termination of employment
[114] There were issues regarding cl 27 which addressed abandonment and cl 32 concerning
termination of employment. The issues concerned contraventions of the NES, but again could
be remedied with an appropriately worded undertaking.
BOOT
[115] It is understood that for an enterprise agreement to be approved it must, in most
circumstances, pass the BOOT.101 This is one of those circumstances. The Commission is
required to be satisfied at the test time, that each award covered employee and each
prospective award covered employee will be better off if the agreement applies to the
employee rather than if the relevant modern award applies.102
[116] There were issues identified by the Commission where it appeared that the Trades and
Services Agreement had not passed the BOOT. However, given that I have found that the
Trades and Services Agreement has not been genuinely agreed, I do not intend to traverse the
issues in detail. However, some of pressing issues are covered briefly.
[117] Concerning the rates of pay, a Pay Schedule at Table 1 provided that the rates listed
were ‘the minimum rate payable to an Employee…’. However, a note at the end of Table 1
stated that ‘the hourly rate stipulated above will be payment for all applicable allowances,
penalties, overtime and disabilities associated with your work. The only exceptions are those
allowances detailed in this Agreement’. The Trades and Services Agreement provided shift
101 Fair Work Act 2009 (Cth) ss 186(2)(d), 189.
102 Ibid s 193.
[2019] FWC 210
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and overtime penalties therefore it was unclear which employees received such penalties
given the rates were all purpose. Further, if the rates were all purpose, as purported, then it
was apparent that they were not, in all circumstances, high enough to compensate the
employee.
[118] The Trades and Services Agreement referenced apprentices and provided for the
payment of the percentage of the applicable ‘Normal Hourly Rate’ set out in the ‘Pay
Schedule’. Apprentices that would otherwise be covered by the Vehicle Award or
Manufacturing Award would fall below the rates of pay in these awards in their first and
second year of a four year apprenticeship. Regarding the Manufacturing Award the
percentage difference in the first and second years was -19.79% and -2.19% respectively, and
for the Vehicle Award the percentage differences were 22.47% and -5.44%. It is
acknowledged that Georgiou provided a draft undertaking that it would not employ
apprentices under the Trades and Services Agreement.
[119] The issue concerning the pay rate of Trainee Employees has already been addressed.
An undertaking was again provided by Georgiou that Trainee Employees would not be
employed to perform any work to which the Trades and Services Agreement applied.
[120] The span of hours’ provision at cl 9.2 did not specify the days on which ordinary hours
were to be worked, and cl 9.6 provided for a roster across Monday to Saturday. Clause 9.6
provided that site roster or distance work may include normal hours on a Sunday. With
regard to rates of pay, the concern identified was that in the absence of the appropriate penalty
for the work on the Saturday or Sunday the employees may not be better off overall.
[121] Shift penalties for afternoon shifts and night shifts were set out in Table 2 of the
Trades and Services Agreement, but the hours when a night shift or afternoon shift
commenced or concluded were not provided. Further, the shift penalty at 120% appeared less
than that provided in the relevant awards.
[122] The benefits provided on redundancy are set out in cl 39 of the Trades and Services
Agreement. The Commission informed Georgiou that while the clause was aligned with the
entitlement provided for in the Vehicle Award and Manufacturing Award, there was a
difference between the redundancy entitlement provided for by the Trades and Services
Agreement, and that which is provided by the Construction Award.
[123] The Full Bench of the Commission in Construction, Forestry, Mining and Energy
Union v Levent Painting Pty Ltd t/a Levent Altintas (Levent Painting) considered the
redundancy scheme in the Construction Award when compared to the NES entitlement.103
The agreement in question in Levent Painting preserved most of the entitlements arising under
the industry specific scheme, with the less beneficial component (NES) restricted in its
application to those employees engaged for a specified period for a specified task.104 The Full
Bench accepted that there was a postulated detriment and, when considered with other less
beneficial terms, found that there were no compensating benefits to make good the
shortfalls.105
103 [2017] FWCFB 3911 [7].
104 Construction, Forestry, Mining and Energy Union v Levent Painting Pty Ltd t/a Levent Altintas [2017] FWCFB 3911 [7].
105 Construction, Forestry, Mining and Energy Union v Levent Painting Pty Ltd t/a Levent Altintas [2017] FWCFB 3911 [7].
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[124] While Georgiou provided an undertaking concerning the redundancy clause, it
addressed another issue regarding redeployment. It did not direct attention to the
abovementioned shortfall.
[125] I have not traversed all of the issues with regards to the rates of pay and other BOOT
issues.
Conclusion
[126] Please note that my concluding remarks were included in the introductory paragraphs.
DEPUTY PRESIDENT
Appearances:
Mr S Heathcote for the Applicant
Mr B Kruse for the CFMMEU
Hearing details:
1 – 2 November 2018
Printed by authority of the Commonwealth Government Printer
PR703835
WORK MMISSION
