1
Fair Work Act 2009
s.604—Appeal of decision
Construction, Forestry, Maritime, Mining and Energy Union
v
Ditchfield Mining Services Pty Limited
(C2019/1236)
SENIOR DEPUTY PRESIDENT HAMBERGER
DEPUTY PRESIDENT GOSTENCNIK
DEPUTY PRESIDENT SAUNDERS SYDNEY, 14 JUNE 2019
Appeal against decision [2019] FWCA 661 of Deputy President Bull at Sydney on 5 February
2019 in matter number AG2018/1902 – whether there was a denial of procedural fairness –
whether there could be satisfaction that employer complied with s.180(5) – permission to
appeal granted – appeal upheld – decision to approve agreement quashed – application to
approve agreement remitted to the Deputy President.
[1] By its notice of appeal lodged on 26 February 2019, the Construction, Forestry,
Maritime, Mining, and Energy Union (Appellant) seeks permission to appeal and appeals a
decision made on 5 February 2019 by Deputy President Bull to approve a single-enterprise
agreement with undertakings1 (Decision). The agreement is titled the Ditchfield Mining
Services Pty Ltd – Coal Mining Enterprise Agreement 2018 (Agreement).
Background
[2] The Agreement was made on 26 April 2018, when Ditchfield Mining Services Pty Ltd
(Respondent) requested four employees employed at the time and covered by the Agreement
to approve the Agreement and those employees voted to approve it.2 At the time the
Agreement was made, the four employees were covered by the Black Coal Mining Award
2010 (Award). According to the Respondent’s material filed in support of its application for
the approval of the Agreement, there had previously been an enterprise agreement covering
the employees while these employees had been working for a parent company of the
Respondent.3 It appears from the Respondent’s material that the relevance of the prior
enterprise agreement was that it operated as a reference point for the purposes of explaining
the terms of the Agreement and effect of those terms to employees. So much is clear from the
following, which appears in answer to question 2.6 in the employer’s statutory declaration:
1 [2019] FWCA 661.
2 Appeal Book p 70.
3 Ibid p 69.
[2019] FWCFB 4022
DECISION
E AUSTRALIA FairWork Commission
[2019] FWCFB 4022
2
“The agreement is similar to an enterprise agreement which had previously applied to
former mining operations undertaken by a parent company of the Applicant and which
was well known to all of the employees (who had previously been employed under this
agreement). All amendments to the previous Agreement were clearly highlighted to
make it easy for the employees to identify any changes. Employees were invited to
discuss any concerns with management.”4
[3] There appears no dispute that at the time the four employees voted to approve the
Agreement, their employment was covered by the Award, and that the Award applied in
relation to their employment by the Respondent. The Agreement is expressed to cover
employees undertaking work that would otherwise be covered by the Award.5
[4] The Appellant was not a bargaining representative for the Agreement. The Appellant
sought to be heard in relation to the application to approve the Agreement. The Deputy
President opined that the Appellant was able to assist the Fair Work Commission (the
Commission) in its approval deliberations and, pursuant to s.590(1) of the Fair Work Act
2009 (Act), he accepted written submissions made by the Appellant and said he would take
them into account.6
[5] The Respondent initiated bargaining or agreed to bargain on 19 March 2018 by
purporting to issue a notice of employee representational rights (NERR).7 It subsequently
discovered the notice was defective. It therefore ceased bargaining, then initiated bargaining
when it gave employees employed at the time a compliant NERR on 3 April 2018.8 The
provision of the compliant NERR appears to have coincided with the notification time.
[6] The four employees who voted to approve the Agreement were also employee
bargaining representatives for the proposed Agreement.9 On 7 May 2018, the Respondent
applied to the Commission for the approval of the Agreement. On 11 May 2018, the
Appellant advised the Commission that it had concerns about the Agreement and that it
wished to have its concerns heard. On 22 May 2018, the Appellant advised the Commission
that it sought to be heard pursuant to s.590 of the Act. It sought a copy of an unredacted
employer statutory declaration filed in support of its application for approval and it provided
submissions on these matters.10
[7] The approval application was initially allocated to Deputy President Colman. On 28
August 2018, the Appellant was advised that the Deputy President had requested further
information in relation to the substantial issues the Appellant had with the application and an
articulation of the reasons why the Appellant wished to see the unredacted version of the
statutory declaration.11 The Appellant provided an email response the following day, 29
August 2018, in which it set out the concerns it had with the Respondent’s compliance with
4 Ibid.
5 Appeal Book p 37 clause 1.2.
6 [2019] FWCA 661 [21].
7 Appeal Book pp 70, 98.
8 Ibid pp 68, 70, 98.
9 Ibid pp 64-6.
10 Ibid pp 78-86.
11 Ibid pp 111-2.
[2019] FWCFB 4022
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s.180(2) and s.180(5) of the Act, with genuine agreement under s.188 of the Act and with the
better off overall test.12
[8] Also on 28 August 2018, staff of the Commission emailed the Respondent setting out
several issues Deputy President Colman had raised in relation to the application for approval
of the Agreement.13 A copy of that correspondence was not sent to the Appellant.
[9] On 30 August 2018, the Respondent sent an email to the Commission setting out its
responses to the matters raised in the email dated 28 August 2018.14 An undertaking was also
provided.15 A copy of that correspondence was not sent to the Appellant.
[10] On 5 September 2018, the Appellant sent an email to the Commission setting out a
correction to its earlier email of 29 August 2018.16
[11] On 11 September 2018, the Appellant was provided a table to which the employer’s
statutory declaration refers, and was also advised that Deputy President Colman invited
further submissions in relation to the Appellant’s objections.17 The Appellant made a
submission in response to that invitation on 17 September 2018.18 The Appellant’s
submission was provided to the Respondent and the Respondent provided a submission in
response on 3 October 2018.19 It is uncontroversial that a copy of this response submission
was not provided to the Appellant prior to the Decision.
[12] The Appellant sought an update on the status of the application on 16 October 2018 by
sending an email to “agreementsprogressenquiry@fwc.gov.au”.20 A response to the request
for an update does not appear to have been given. The approval application was subsequently
allocated to Deputy President Bull. After that allocation, there were various communications
between the Commission and the Respondent, none of which were disclosed to or shared with
the Appellant prior to the Decision.21 These communications included a telephone conference
involving the Respondent and the Deputy President on 29 November 2018, and email
exchanges that largely dealt with the content of undertakings the Respondent had proposed.22
[13] On 25 October 2018, and further to its earlier request, the Appellant sought an update
on the status of the approval application by sending an email to
“agreementsprogressenquiry@fwc.gov.au”.23 Again, a response to the request for an update
does not appear to have been given.
12 Ibid pp 109-11.
13 Ibid pp 90-3.
14 Ibid pp 98-100.
15 Ibid p 102.
16 Ibid p 103.
17 Ibid p 108-14.
18 Ibid pp 117-45.
19 Ibid pp 146-63.
20 Ibid p 164.
21 Ibid pp 178-87 and 191-212.
22 See, for example, ibid pp 180-7.
23 Ibid p 171.
[2019] FWCFB 4022
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[14] On 13 December 2018, the Appellant sent an email to member.assist@fwc.gov.au,
attaching an updated submission and requesting that the material be forwarded to Deputy
President Colman.24 The text of the email was as follows:
“In September the CFMMEU filed with the FWC a submission setting out our
objections to the approval of the above mentioned Agreement.
We have been informed the matter is before Colman DP.
Recently we identified an error in some of the calculations in that submission. Whilst
the error does not change the ultimate outcome or conclusions we draw from the
analysis, we thought it appropriate to identify and inform the FWC of the error, its
cause, the correction and its impact.
To that end we attach a document setting out the error and the correction. We
apologise for not picking it up earlier.
To our knowledge the matter is still before the Deputy President. We have not copied
in the applicant because our submission was sent to the FWC only. The FWC is of
course free to provide any material from us to the Applicant. If the FWC wants us to
provide this material to the applicant, please let us know.
We would be grateful if you could pass on this material to the Deputy President.”25
[15] A response to this email also does not appear to have been given.
[16] Various communications between the Commission and the Respondent continued. The
last of these was an email from the Respondent to Deputy President Bull’s chambers on 21
January 2019 responding, inter alia, to issues raised by the Appellant and contained revised
undertakings.26 Those communications, however, were not confined to the undertakings. For
example, an email from the Deputy President’s chambers to the Respondent on 11 December
2018 requested a “response to the CFMMEU submission that as the lesser conditions in the
Agreement as compared to the Award were not explained to employees [there] was a failure
to comply with s.180(5)…”.27 The Respondent provides a response by email dated 14
December 2018 that, inter alia, provided:
“…the terms of the EA, and the effect of those terms were explained in detail to the
employees including that the Ditchfield EA provides for wages that are significantly
more generous as compared to the Award. That being the case we do not consider that
the issue raised by the CFMMEU prevents the Commission from approving the EA.”28
[17] As to the specific question posed in the email of 11 December 2018, the Respondent
wrote that it disagreed with the CFMMEU submission.29
24 Ibid pp 188-90.
25 Ibid p 188.
26 Ibid pp 191-3.
27 Ibid pp 184-5.
28 Ibid pp 182-3.
29 Ibid p 183.
[2019] FWCFB 4022
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[18] This response prompted a further email from the Deputy President’s chambers on 21
December 2018, which relevantly stated:
“From your 14 December response is it taken that the more beneficial conditions of the
Award not contained in the Agreement were not identified and advised to employees?
If this is not correct please advise what occurred.”30
[19] None of these communications which concerned submissions of the Appellant were
provided to it.
[20] On 21 January 2019, the Deputy President’s chambers provided the Appellant with an
unredacted copy of the employer statutory declaration filed in support of the application.31
Also on that day, the Respondent sent an email to the Deputy President’s Chambers, in which
it relevantly provided a response to the issue raised in the Deputy President’s email of 21
December 2018. In essence, the Respondent contended that there was no statutory obligation
to make the kind of comparison asserted by the Appellant.32
[21] On 24 January 2019, the Appellant requested that it be permitted to make oral
submissions and to participate in any hearing of the matter.33
[22] On 25 January 2019, the Deputy President’s chambers advised the Appellant by email
that the application was being dealt with “on the papers” and as such, there will not be an oral
hearing, but that if the Appellant wished to make any written submissions it should do so by
no later than close of business on 30 January 2019.34 It is apparent that neither the
Respondent’s submissions, its supplementary email communications responding to the issues
raised by the Appellant, nor any of the undertakings were revealed to the Appellant prior to
the Decision. This does not appear to be controversial.
[23] On 29 January 2019, the Appellant confirmed by email that in the absence of an oral
hearing, it relied on the material already filed.35
Appeal grounds
[24] The Appellant’s notice of appeal contains 9 appeal grounds. The first asserts standing
to bring the appeal. The Respondent accepts that the Appellant has standing.36 We agree. The
ninth ground is a catch-all ground and since no other grounds of appeal have been asserted,
this ground need not be considered further.
[25] Ground 2 contends that there was a denial of procedural fairness because although the
Appellant was permitted to make written submissions, the Deputy President made the
30 Ibid pp 181-2.
31 Ibid p 214.
32 Ibid pp 191-2.
33 Ibid p 214.
34 Ibid p 213.
35 Ibid.
36 Respondent’s Outline of Submission [2].
[2019] FWCFB 4022
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Decision without providing the Appellant with the submissions and/or responses of the
Respondent and/or his communications with the Respondent.
[26] Grounds 3, 4 and 5 contend that the Deputy President erred in being satisfied that the
relevant employees had genuinely agreed to the Agreement because the Respondent did not
take all reasonable steps to ensure that the terms of the Agreement, and the effect of those
terms, were explained to the relevant employees, and that the explanation was provided in an
appropriate manner taking into account the particular circumstances and needs of the relevant
employees.
[27] Ground 6 is that the Deputy President erred in seeking the views of the bargaining
representatives as to the undertakings proposed by the Commission under s.190(4) of the Act
through the Respondent’s representative, and in accepting undertakings obtained in that
manner.
[28] Grounds 7 and 8 also engage with whether the relevant employees genuinely agreed to
the Agreement. The former ground contends error in the Deputy President’s satisfaction that
each employee had access to the relevant safety policies and procedures, and that the
requirements of s.180(2) of the Act were met. The error is said to arise because the Deputy
President relied on a submission from the Respondent of a general nature rather than sworn
evidence, in circumstances where sworn evidence had been provided to the Commission that
was incomplete. The latter ground contends the Deputy President erred in failing to consider
whether there were any other reasonable grounds for believing that the Agreement had not
been genuinely agreed to by the relevant employees, as required by s.188(1)(c) of the Act.
[29] We turn now to consider the appeal grounds.
Appeal ground 2 – whether there was a denial of procedural fairness
[30] The Appellant contends the Deputy President failed to afford the Appellant procedural
fairness by making his Decision without providing it with the Respondent’s submissions,
responses and communications with the Commission. The Appellant says that procedural
fairness required that it be provided with these, as both Deputy Presidents Colman and Bull
had sought submissions from the Appellant without limitation, and the Respondent’s
submissions, responses and communications directly addressed matters that were in contest.
[31] The Respondent contends that the Appellant was not denied procedural fairness in
substance or in fact. It says the Appellant was given numerous opportunities to provide
written submissions setting out its concerns, and a full opportunity to make or address every
point of substance touching on its concerns, as disclosed by the chronology that we have set
out in the background earlier in this decision.
[32] The Respondent contends the correspondence between the Respondent and the
Commission about which the Appellant complains falls into three categories. First,
correspondence containing responses to matters raised by the Commission before any
submissions were filed by the Appellant. Secondly, correspondence containing responses to
the Appellant’s submissions. Thirdly, correspondence relating to an undertaking. The
Respondent says that a failure to provide the Appellant with communications in the first
category cannot amount to procedural unfairness, as the correspondence did not, and could
not, relate to the matters raised by the Appellant. As to the third, the Respondent says the
[2019] FWCFB 4022
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Deputy President considered the undertaking in accordance with s.190, including by seeking
the views of the bargaining representatives, and the Appellant was not a bargaining
representative.
[33] As to the second category, the Respondent says that the Appellant does not set out
what steps it would have taken, or what different or additional matters it would have raised, if
it had received this correspondence. In the alternative, it says that any deficiencies in the
procedural fairness afforded to the Appellant were of no consequence because any denial of
procedural fairness did not have a bearing on the Decision. The matters the Appellant raises
on appeal are the same issues and concerns which it set out in its written submissions before
the Deputy President. The Respondent contends that the Appellant, now armed with the
knowledge of all the communications between the Respondent and the Commission, does not
seek to raise any new issues or concerns.
[34] Administrative decision-makers, including Members of the Commission, must accord
procedural fairness to those affected by decisions they make. What is required to achieve this
in any given case should be determined by reference to “what is required in order to ensure
that the decision is made fairly in the circumstances having regard to the legal framework
within which the decision is to be made”.37 The procedure adopted by an administrative
decision-maker can sometimes itself be shown to have failed to afford a fair opportunity to be
heard to a person. In such cases, a denial of procedural fairness may be established by nothing
more than that failure, unless the failure did not deprive the person of the possibility of a
successful outcome.38
[35] However, not every breach of the rules of natural justice will affect a decision. As the
High Court observed in Re Refugee Review Tribunal; Ex parte Aala:39
“Not every breach of the rules of natural justice affects the making of a decision. The
decision-maker may have entirely upheld the case for the party adversely affected by
the breach; or the decision may have turned on an issue different from that which gave
rise to the breach of natural justice. Breach of the rules of natural justice, therefore,
does not automatically invalidate a decision adverse to the party affected by the
breach. This principle was acknowledged by this court in Stead v State Government
Insurance Commission when it said that “not every departure from the rules of natural
justice at a trial will entitle the aggrieved party to a new trial”. Nevertheless, once a
breach of natural justice is proved, a court should refuse relief only when it is
confident that the breach could not have affected the outcome because “[i]t is no easy
task for a court … to satisfy itself that what appears on its face to have been a denial of
natural justice could have had no bearing on the outcome”. In this case, however, the
denial of natural justice did not affect the outcome. After analysing the reasons of the
second tribunal and the history of the proceedings, the best conclusion is that the
tribunal would have found that the prosecutor did not have a well-founded fear of
persecution even if it had had the four statements before it.”40
37 Minister for Immigration and Border Protection v WZARH (2015) 256 CLR 326 [28]-[30] (Kiefel, Bell and Keane JJ).
38 Ibid [59]-[61] (Gageler and Gordon JJ).
39 (2000) 204 CLR 82.
40 Ibid [104].
[2019] FWCFB 4022
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[36] Where an obligation to accord procedural fairness to a person arises, that which is
required will also depend upon the circumstances in each case. As is evident from our
discussion about the background to this matter, the Appellant advised the Commission that it
had concerns about the Agreement and that it wished to have those heard. Specifically, the
Appellant sought to be heard pursuant to s.590 of the Act. The Appellant articulated its
concerns that the Respondent had not complied with s.180(2) and s.180(5) of the Act, that
there were other reasonable grounds for believing that the Agreement had not been genuinely
agreed to by the employees (s.188(1)(c)), and that the Agreement did not pass the better off
overall test.41
[37] The Appellant was permitted to make submissions about its concerns. We agree with
the Respondent that failing to provide the Appellant with communications falling in the first
category identified above did not amount to a denial of procedural fairness. That
correspondence did not relate to the matters raised by the Appellant; rather, it was concerned
with matters raised by the Commission before the Appellant had articulated any concerns.
[38] Furthermore, although it may have been wise for the Deputy President to have
provided the Appellant with the undertakings, since they touched on the assessment as to
whether the Agreement passed the better off overall test, the Deputy President was not under
a statutory obligation to do so, since the Appellant was not a bargaining representative. Given
the statutory context in which undertakings are considered, we do not think that procedural
fairness in these circumstances required providing the Appellant with correspondence relating
to the undertakings. Undertakings are given in response to the Commission’s concerns about
whether one or more of the approval matters in ss.186 and 187 have been met. They are not
responsive to concerns raised by an interested third party such as the Appellant. We therefore
do not consider that there has been any denial of procedural fairness by reason only of the
failure to provide the Appellant with copies of communications falling into the third category.
[39] However, the failure to provide the Appellant with documents falling within the
second category seems to us to amount to a denial of procedural fairness, particularly given
the procedure the Deputy President adopted to deal with the application. As we have already
noted, the Appellant articulated four broad areas of concern and provided written submissions
in respect of its concerns. The Respondent was provided with a copy of the Appellant’s
written submissions, and it provided submissions in response. Subsequently, the Appellant
sought the opportunity to make oral submissions at a hearing. This request was denied. We
make no criticism of that decision. However, the Deputy President’s Associate advised the
Appellant by email on 25 January 2019 that the matter would be determined “on the papers”
and that if it wished to make any written submissions it should do so by no later than close of
business 30 January 2019.42
[40] The invitation to make any written submissions occurred in circumstances where the
Appellant had already made written submissions, but the Appellant was not aware that the
Respondent had subsequently made submissions and provided other written communications
in response to the Appellant’s submissions. The Appellant’s advice to the Deputy President
that it relies on material already filed by it in the matter must be viewed in this context.
41 Appeal Book pp 109-11.
42 Ibid p 213.
[2019] FWCFB 4022
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[41] It seems plain to us that the Appellant decided not to make any further written
submissions and rested on the submissions that it had already filed because, on the material
available to it, the Appellant had nothing more to say. It did not know the Respondent had
filed responsive submissions. It was thus denied the opportunity to join issue with those
submissions. When dealing with a matter “on the papers” and a party is invited to make any
written submissions it wishes, that party may only make an informed decision about whether
it will make some submissions if it has available to it “the papers” on which the decision-
maker will base his or her decision. Relevantly here, those papers included the Respondent’s
submissions responding to the Appellant’s earlier filed submissions.
[42] The information that was initially available to the Deputy President about the steps
that the Respondent took to explain the terms of the Agreement and their effect to relevant
employees was limited to the paragraph responsive to question 2.6 in the employer’s statutory
declaration, which we have earlier reproduced. The Appellant’s submissions as to the
Respondent’s compliance with s.180(5) addressed the adequacy of that explanation. The
Appellant was not concerned with whether additional information not contained in the
employer statutory declaration disclosed compliance with s.180(5), because it was unaware of
any such additional information. That additional information was contained in the
submissions filed by the Respondent on 3 October 2018.43
[43] It is clear that the Deputy President considered this additional information in satisfying
himself that there had been compliance with s.180(5) for the purposes of assessing whether
the employees covered by the Agreement had genuinely agreed to it. The Deputy President
dealt with this issue as follows:
“[41] The CFMMEU submit that the Commission cannot be satisfied that the Applicant
has complied with the requirements of s.180(5) of the Act based on what has been
supplied to the Commission by way of the F17. It is contended that presenting
employees with a marked up copy of the Agreement did not constitute an explanation
in light of the decision in CFMEU v One Key Workforce Pty Ltd.
[42] The CFMMEU’s submission states that inviting and providing time for
employees to raise any concerns is still a failure to provide an explanation of the
Agreement and the effect of its terms. The fact that the applicant stated there were no
less beneficial terms in comparison to the Award when there were, indicate that these
matters were not raised with employees.
[43] I accept that, on the face of the responses provided in the F17, the CFMMEU
submissions raise legitimate concerns.
[44] Mr Ditchfield’s F17 Statutory Declaration provided some detail as to the process
undertaken to explain the Agreement and the effect of its terms stating that:
on 19 March 2018, the applicant agreed to bargain (the notification time).
on 3 April 2018, the NERR notices were provided to all employees by hand
following which they returned a signed instrument of appointment and 4 bargaining
representatives were appointed. On the same day, all employees were issued with a
43 Ibid p 149 [16].
[2019] FWCFB 4022
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copy of the draft Agreement. Additional copies were available in the site office. A
copy was also made available in the Tuncurry office of the applicant’s parent
company where employees worked on occasion leading up to the vote.
on 17 April 2018, employees were hand-delivered a written notice advising that a
secret ballot would take place at the work site on 26 April 2018. On 26 April 2018,
the vote took place.
[45] Mr Ditchfield, in his Statutory Declaration, states that the Agreement was similar
to an enterprise agreement that previously applied to former mining operations
undertaken by the parent company of the applicant which was known to all employees
as they had worked under the parent company agreement.
[46] All amendments to the previous agreement were ‘clearly highlighted’ to make it
easy for the employees to identify any changes. Employees were invited to discuss any
concerns with management.
[47] In the applicant’s further written response of 3 October 2018 the applicant
acknowledged that its F17 explanation was not a comprehensive response and
provided further elaboration on how its explanation of the Agreement, and the effect
of its terms to employees, was provided.
a meeting was held on site on 17 April 2018, involving three members of
management and all of the relevant employees during which the attendees went
through the Agreement in detail, from front to back, discussing each of the terms of
the Agreement;
during that meeting, employees asked a range of questions about the Agreement,
which were answered by management;
a further meeting was held on 24 April 2018, with the same attendees, during which
the Agreement was again discussed at length; and
throughout the bargaining/negotiation period and the access period, the Mine
Manager was based full time on site and was available to discuss the Agreement
with the relevant employees.
[48] The explanation was appropriate taking into account the particular circumstances
and needs of the employees. There is nothing in the demographic group in answer to
question 4.3 of the F17 which would require special consideration to be given to any
employee.
[49] Each employee had nominated themselves as a bargaining representative; no
employee had been employed for less than 8 years or was aged less than 21 years; all
employees came from an English speaking background and to the applicant’s
knowledge no circumstances existed to warrant any additional steps being taken.
[50] The process adopted by the applicant was reasonable in ensuring that the terms of
the Agreement and the effect of those terms were explained to the employees.
[2019] FWCFB 4022
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[51] The CFMMEU rely extensively on the Federal Court decision of One Key
Workforce Pty Ltd v CFMEU (One Key) and the subsequent Full Court appeal
decision in CFMEU v One Key Workforce Pty Ltd. I am satisfied the factual
circumstances in this application are markedly different from those which applied in
One Key.
[52] In One Key there were no face to face meetings, the agreement for approval
covered classifications in 11 awards, the 3 employees voting on the agreement only
worked across two awards and could not give informed consent in regard to
occupations and industries in which they did not work. Those circumstances, or
anything similar, do not exist in this application.
[53] The CFMMEU further submits that there was no genuine agreement as the
employees were not advised of the Agreement’s terms and conditions which are less
beneficial than the Award. The statutory declaration of Mr Ditchfield states at 3.5 that
there are no less beneficial terms and conditions. This assertion is incorrect as
conceded by the applicant in their further written submissions. Where less beneficial
terms have been identified by the applicant, the applicant has provided undertakings to
ensure that the Award terms and conditions apply.
[54] The identified less beneficial terms and conditions are discussed below in respect
to the better off overall test (BOOT). The foremost less beneficial terms of the
Agreement as submitted by the CFMMEU relate to wages and the working of
overtime. Contrary to the CFMMEU submissions, the applicant does not accept that
the wages and overtime terms of the Agreement are less beneficial than the Award,
instead stating that the CFMMEU have misinterpreted the wording of the Agreement.
For the reasons provided below, the Commission is satisfied that the wages and
overtime provisions of the Agreement are not less beneficial than the Award.
[55] There is no direct legislative requirement for an employer to raise with employees
any or every less beneficial provision in comparison with the Award, however it may
be a factor for the Commission to take into account in applying s.180(5) of the Act.
[56] In this application, the Commission accepts that there are less beneficial
provisions in the Agreement than those contained in the Award; these are identified
below in discussing the better off overall test (BOOT). This required further
Commission enquiry, having regard to Mr Warren Ditchfield’s F17 statutory
declaration incorrectly stating that there are no lesser benefits.
[57] The identified less beneficial conditions identified below are not substantial in
their nature and an undertaking has been provided by the applicant to provide no less
than the Award provision in each case. All employees covered by the Agreement when
it was made have lengthy service with the applicant, were bargaining representatives
for the Agreement, and have been shown the undertakings and support Commission
approval of the Agreement. Further, the rates in the Agreement are well above those in
the Award.
[58] Having regard to the process set out in the applicant’s statutory declaration, and
the further written explanation of the process undertaken by the applicant, the
Commission is satisfied that all reasonable steps were taken to explain the terms of the
[2019] FWCFB 4022
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Agreement to employees as per s.180(5) of the Act. I am satisfied that the employees
were in a position to cast a fully informed vote in the sense that they were aware of the
terms of the Agreement and the effect of its terms.”44 [Endnotes omitted]
[44] The Deputy President accepted that the Appellant’s initial concern was legitimate. He
then took into account the additional information contained in the Respondent’s submission of
3 October 2018 to satisfy himself that the employer had complied with s.180(5) of the Act.
This was done without providing the Appellant with a copy of that submission. Considering
the procedure that was adopted, the opportunity afforded to the Appellant to provide further
written submissions was no opportunity at all, since it had neither a copy of, nor knowledge
of, the Respondent’s submissions containing the additional information. In our view, there
was plainly a denial of procedural fairness in these circumstances.
[45] The Respondent also made a further submission on 21 January 2019. In response to
the Appellant’s submission about the explanation of the differences between the Award and
the Agreement, it contended, inter alia, that an employer has no legislative obligation to
explain the more beneficial terms of an award that are not contained in an agreement. The
submission also sought to distinguish other Full Bench decisions of the Commission in which
an employer’s failure to identify less beneficial terms in an agreement compared to the
relevant award in its statutory declaration was held to be a material consideration in assessing
whether there had been compliance with s.180(5) of the Act.45 The Deputy President appears
to take this into account at [55]-[57] of the Decision, but this submission was not provided to
the Appellant. Consequently, it did not have an opportunity to join issue with the submission.
[46] We do not accept the Respondent’s contention on appeal that the Appellant has not
identified what further steps it would have taken in light of the matters the Appellant has
identified in its outline of submissions on appeal at [43], [44], [45] [46] and [51]. Moreover,
and quite obviously, if the Appellant had been armed with the Respondent’s submissions, it
would have addressed whether the additional information provides a sufficient basis upon
which the Deputy President could be satisfied that the employer had complied with s.180(5)
of the Act when it lodged further submissions pursuant to the Deputy President’s invitation.
This is not a case where the Appellant, armed with full knowledge of the Respondent’s
response to its contention as to compliance with s.180(5), made a strategic or forensic
calculation to say nothing more. It made its decision absent that knowledge.
[47] It follows, in our view, that the failure to provide the Appellant with the Respondent’s
submissions of 3 October 2018 and email correspondence of 21 January 2019 was a denial of
procedural fairness. In circumstances where the hearing was to be conducted on the papers,
providing the Appellant with those submissions and correspondence was required to ensure
that the decision concerning the approval of the Agreement was made fairly. As the Appellant
was denied procedural fairness, the Decision is affected by appealable error.
[48] However, that conclusion does not of itself result in the grant of permission to appeal
the Decision. The Appellant has been given a full opportunity on appeal to agitate the matters
it would have advanced had it been given the information that it lacked at first instance.
Unless we are persuaded that the Deputy President was otherwise in error in reaching his
Decision that the approval requirements in ss.186 and 187 of the Act had been met and in
44 [2019] FWCA 661 [41]-[58].
45 Appeal Book p 192.
[2019] FWCFB 4022
13
accepting the undertaking, there would be little utility in granting permission to appeal the
Decision, or at least, no utility in upholding the appeal.
[49] We turn then to consider the remaining grounds of appeal.
Appeal ground 6 – obtaining the views of known bargaining representatives about the
undertaking
[50] The Appellant contends the Deputy President erred in seeking the employee
bargaining representatives’ views on the undertakings proposed by the Commission under
s.190(4) of the Act through the Respondent’s representative, and in accepting undertakings
obtained in that manner. It says that accepting an undertaking from a bargaining
representative through the employer with which the bargaining representative was bargaining
cannot guarantee fulfilment of the purpose of s.190(4). The Appellant contends that s.190(4)
is designed to ensure that the employer alone cannot be the source of the undertaking. The
Appellant contends that the proper procedure is that adopted by several Full Bench decisions,
to set in place a process whereby the bargaining representatives communicate directly with
the Commission.46
[51] Section 190(4) of the Act provides that the Commission must not accept an
undertaking under s.190(3) unless it has sought the views of each person who it knows is a
bargaining representative for the Agreement. As noted in the background earlier discussed, on
28 August 2018, staff of the Commission emailed the Respondent setting out concerns with
the application for approval of the Agreement. The email noted that, “[i]f undertakings are to
be provided… please ensure you seek the views of any bargaining representative in relation to
the issues raised. Any objections to the proposed undertakings should be raised with the
Commission prior to the approval of the Agreement.”47 On 21 December 2018, the Deputy
President’s Associate wrote to the Respondent requesting, inter alia, that it “please provide the
view of the Bargaining Representatives on the undertakings”.48
[52] On 8 January 2019, the Respondent advised the Deputy President’s Associate that one
of the bargaining representatives was still on annual leave, and that the undertakings would
not be formally submitted until he returned from leave.49 On 21 January 2019, the Respondent
wrote to the Deputy President’s Associate by email, attaching a signed copy of the
undertaking,50 and advising that it had obtained the views of each of the bargaining
representatives and that they each support the undertakings and the approval of the
Agreement.51 The email also attached letters the Respondent had provided to each of the
bargaining representatives seeking their views on the undertakings. The letters noted that
feedback may be provided directly to the Deputy President’s chambers.52 The letters
46 For this proposition, the Appellant referred to Newlands Coal Pty Ltd v CFMEU [2010] FWAFB 7401 [79] and Australian
Workers' Union v Roadworx Surfacing Pty Ltd [2011] FWAFB 1759 [21].
47 Appeal Book p 91.
48 Ibid p 181.
49 Ibid p 180.
50 Ibid pp 195-6.
51 Ibid p 191.
52 Ibid pp 197-212.
[2019] FWCFB 4022
14
contained a signed acknowledgement and feedback from each bargaining representative about
the proposed undertakings.53
[53] The Act does not circumscribe the way the Commission might seek the views of
known bargaining representatives in relation to an undertaking. Specifically, there is no
prohibition on the Commission utilising the employer to seek those views and communicate
those views to the Commission. Whilst it is always preferable for the views of bargaining
representatives to be communicated directly to the Commission, views communicated
through the employer are no less valid. They are not to be impugned merely because they
were sought through the employer. In the circumstances that we have highlighted above, there
does not appear to us to have been anything improper in the way the Deputy President sought
the bargaining representatives’ views. No appealable error is disclosed by grounds 6 and it is
rejected.
Appeal grounds 3, 4 and 5 – whether employees genuinely agreed to the Agreement
[54] The Appellant contends that the Deputy President erred in being satisfied that the
relevant employees genuinely agreed to the Agreement, because the Respondent did not take
all reasonable steps to ensure that the terms of the Agreement, and the effect of those terms,
were explained to the relevant employees, and that the explanation was provided in an
appropriate manner taking into account the particular circumstances and needs of the relevant
employees.
[55] The Respondent contends that s.188(1) of the Act required the Deputy President to
reach a state of satisfaction based on the material before him – and reasonable minds may
differ in that regard. It says the existence of the requisite opinion or belief on the part of
Deputy President is a jurisdictional fact.54 In reaching the requisite satisfaction, the Deputy
President was required to evaluate whether in all the circumstances, the employer has taken
all reasonable steps to ensure that the terms of the Agreement, and the effect of those terms,
were explained to the relevant employees. It contends that the Respondent’s compliance with
s.180(5) of the Act need only be established to the satisfaction of the decision-maker.
Compliance with s.180(5) is not a jurisdictional fact. That is, its objective existence is not a
precondition to the Commission’s power to approve the Agreement.55
[56] So much is correct, but as the Respondent acknowledges, it is a jurisdictional fact that
the Deputy President reached the requisite state of satisfaction as to, inter alia, compliance
with s.180(5). Moreover, in reaching the requisite state of satisfaction, there must be material
available to the Deputy President to support reaching that state. An evaluative assessment of
no or insufficient information in reaching a state of satisfaction is no assessment at all.
[57] The Respondent maintains that the Decision discloses that the Deputy President
reached the requisite state of satisfaction with respect to the Respondent’s compliance with
the requirements of s.180(5) of the Act. It says that not only is there no error identified by the
Appellant in this regard, but also that any appealable error would need to be of the kind
identified House v The King.56
53 Ibid.
54 Citing One Key Workforce Pty Ltd v CFMEU (2018) 356 ALR 535 [99].
55 Ibid [103].
56 (1936) 55 CLR 499.
[2019] FWCFB 4022
15
[58] The Respondent points to the details provided in the employer statutory declaration
about the steps it took to explain the terms of the Agreement and the effect of those terms to
employees, as well as the additional information provided in its submission of 3 October 2018
to supplement the statutory declaration. It points to the fact that the Appellant relied on the
Full Court’s decision in One Key Workforce Pty Ltd v CFMEU57(One Key Workforce (No 2))
and that the Deputy President considered that decision and distinguished the factual
circumstances where there was no evidence before the Commission about the quality of the
explanation, and the circumstances that pertained in respect of this application. Therefore, the
Respondent contends that as the application before the Deputy President bore no resemblance
to the facts in One Key Workforce (No 2), the only question before the Deputy President
below was whether he was satisfied that the Respondent had complied with the requirements
set out in s.180(5), amongst others. The Deputy President set out in his Decision the reasons
for his satisfaction. The Respondent says that it was open for him to do so, with the
consequence that no error is disclosed.
[59] Section 186(2) relevantly provides:
“(2) The FWC must be satisfied that:
(a) if the agreement is not a greenfields agreement—the agreement has been genuinely
agreed to by the employees covered by the agreement;”
[60] Section 188 of the Act provides:
“188 When employees have genuinely agreed to an enterprise agreement
(1) 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.
57 (2018) 356 ALR 535.
[2019] FWCFB 4022
16
(2) An enterprise agreement has also been genuinely agreed to by the employees
covered by the agreement if the FWC is satisfied that:
(a) the agreement would have been genuinely agreed to within the meaning of
subsection (1) but for minor procedural or technical errors made in relation to
the requirements mentioned in paragraph (1)(a) or (b), or the requirements of
sections 173 and 174 relating to a notice of employee representational rights;
and
(b) the employees covered by the agreement were not likely to have been
disadvantaged by the errors, in relation to the requirements mentioned in
paragraph (1)(a) or (b) or the requirements of sections 173 and 174.”
[61] Section 180 of the Act sets out several pre-approval steps that an employer must take
before employees that will be covered by an agreement are asked to approve that agreement.
It relevantly provides the following:
“180 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.
…
(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).
…
(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.”
[2019] FWCFB 4022
17
[62] As is evident from the above, satisfaction that the Agreement has been genuinely
agreed to by the employees covered by the Agreement will be achieved, inter alia, if the
Commission Member dealing with an application is satisfied for the purpose of s.186(2)(a)
that the employer complied with ss.180(2) and 180(5) in relation to the Agreement.
[63] In Construction, Forestry, Mining and Energy Union v One Key Workforce Pty Ltd
(One Key Workforce (No 1)), Flick J considered the scope and substance of an employer’s
obligation under s.180(5) of the Act.58
[64] Without repeating his Honour’s analysis, it seems to us that the following general
propositions may be derived from One Key Workforce (No 1).
[65] First, whether an employer has complied with the obligation in s.180(5) depends on
the circumstances of the case.
[66] Secondly, the focus of the enquiry whether an employer has complied with s.180(5) is
first on the steps taken to comply, and then to consider whether:
the steps taken were reasonable in the circumstances; and
these were all the reasonable steps that should have been taken in the circumstances.
[67] Thirdly, the object of the reasonable steps that are to be taken is to ensure that the
terms of the agreement, and their effect, are explained to relevant employees in a manner that
considers their particular circumstances and needs. This requires attention to the content of
the explanation given.
[68] Fourthly, an employer does not fall short of complying with the obligation in s.180(5)
of the Act merely because an employee does not understand the explanation provided.59
[69] That the content of the explanation given is an important consideration in assessing
whether all reasonable steps were taken for the purposes of s.180(5) is made clear by the Full
Court of the Federal Court in One Key Workforce (No 2).60 In this regard, the Full Court
made the following observations about the Commission’s function in considering under
s.188(a)(i) of the Act whether it is satisfied that the employer has complied with s.180(5):
“112 It is common ground that the Commission was never told what was said to the
relevant employees. It was simply told that they had been given an explanation of the
terms of the Agreement and the effect of those terms. In effect, this amounted to little
more than a self-serving statement that the employer had complied with its obligation
under the Act. OKW contended that the fact that it made such a statement in a statutory
declaration was significant. It is not. As the CFMEU argued, whether all reasonable
steps were taken to ensure that the effect of the terms of the Agreement was explained
in an appropriate manner is a question of substance, not form. The recital of a
conclusion on the very question the Commission was required (through an evaluative
58 (2017) 270 IR 410; see, in particular, [94]-[109].
59 This will, of course, depend on the circumstances of each case. Thus, an employer who takes steps to explain the terms of
an Agreement and the effect of those terms in English to a workforce that does not speak or has difficulty in
comprehending English is unlikely to have taken reasonable steps.
60 (2018) 356 ALR 535.
[2019] FWCFB 4022
18
process) to determine is not, without more, a sufficient basis for the satisfaction of the
statutory test. In other words, a bare statement by an employer that an explanation has
been given is an inadequate foundation upon which to reach a state of satisfaction.
OKW submitted that if the Commission had erred in this respect, it was an error in fact
finding or an error in process, which would be an error within its jurisdiction. We
reject this submission. 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
circumstances and needs of the employees and the nature of the changes made by the
Agreement. It is true that the Act does not expressly say that. But the question of
whether an administrative decision-maker is required to consider a matter is not
determined only by the express words of the Act; it may also be determined by
implication from the subject-matter, scope and purpose of the Act: Minister for
Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39–44 (Mason J).
113 A consideration of the subject-matter, scope and purpose of the relevant
provisions of the Fair Work Act indicates that the content of the explanation and the
terms in which it was conveyed were relevant considerations to which the Commission
was bound to have regard. The absence of that information meant that the Commission
was not in a position to form the requisite state of satisfaction. Put differently, 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.
114 The following considerations point inexorably to that conclusion.
115 The Commission was required to be satisfied that OKW had taken “all reasonable
steps to ensure” that both the terms and the effect of the terms had been explained to
the relevant employees as an element in the inquiry as to whether “genuine”
agreement had been obtained from them. 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.
116 In order for the employer to comply with the obligation it must take into account
the particular circumstances and needs of those employees, including their cultural and
linguistic backgrounds, their youth, and the absence of a bargaining representative.
That is made explicit in s 180(6). How could the Commission decide whether the steps
the employer had taken were “all reasonable steps” unless it knew what the employees
had been told before they cast their votes? Without knowing the terms in which the
explanation had been conveyed how could the Commission form an opinion on the
sufficiency of the explanation, particularly having regard to the considerations
mentioned in s 180(6)? Ultimately, how could the Commission decide that a genuine
agreement had been reached without having evidence upon which it could answer both
these questions?
117 As there was no evidence of these matters before the Commission, it necessarily
follows that the Commission purported to be satisfied that OKW’s obligations under s
[2019] FWCFB 4022
19
180(5) had been discharged without taking those matters into account. That was a
jurisdictional error because the Commission did not have authority to make the
decision unless its satisfaction had been informed by them. As is often the case, there
are several ways of describing the error. It could be characterised as a misconception
as to what the exercise of the statutory power entails or an error “as to an important
attribute of the decision to be made”: Graham at [68]. Equally it could be seen as a
misunderstanding on the part of the Commission of the nature of the opinion it was
required to form: Coal and Allied Operations Pty Limited v Australian Industrial
Relations Commission (2000) 203 CLR 194 at [31] (Gleeson CJ, Gaudron and Hayne
JJ). Had the Commissioner applied his mind to the question of what the putative
explanation entailed, he would inevitably have inquired into its content and terms.”61
[70] Section 180(5) of the Act is concerned with the taking of all reasonable steps to
explain the terms of an agreement and the effect of those terms. How many steps and the
content of those steps will necessarily depend on the circumstances. Some employers may, by
reasons of the prevailing circumstances, need to take more or fewer steps than other
employers with different agreements, facing different circumstances. The steps which may, in
a given case, comprise “all reasonable steps” are to be assessed by reference to the
circumstances of the particular case.
[71] Compliance with s.180(5) will not always require an employer to identify detriments
in an agreement vis-à-vis the reference instrument, or for the employer to provide an analysis
between the agreement and the relevant reference instrument, particularly in circumstances
where an existing enterprise agreement, not a reference instrument, applies to the employees
in their employment with the employer. The question of compliance with s.180(5) is to be
judged against the circumstances that pertain at the time at which compliance was required.
Section 57 of the Act makes clear that a modern award does not apply to an employee in
relation to particular employment at a time when an enterprise agreement applies to the
employee in relation to that employment. In the present case, when the explanations were
given, no enterprise agreement applied to the employees and the Award did apply. An
explanation of the effect of the terms of the Agreement vis-à-vis the Award was therefore
capable of being relevant to the evaluative assessment of whether all reasonable steps were
taken to explain the terms of the Agreement and the effect of those terms.
[72] The obligation under s.180(5) to take all reasonable steps to explain to relevant
employees the terms of an enterprise agreement and the effect of those terms is an important
function of the agreement-making scheme established by Part 2-4 of the Act. Its evident
purpose, taking into account its role in assessing whether the employees who were asked to
vote to approve an agreement genuinely agreed to the agreement, is to ensure that employees
are as fully informed as practicable about the terms and effect of the terms of a proposed
enterprise agreement before voting on whether to approve it.62 An employer’s discharge of its
obligation under s.180(5) is intended to enable employees to know what they are being asked
to agree to, and to understand how their wages and working conditions might be affected by
voting in favour of an agreement.63
61 Ibid [112]-[117].
62 One Key Workforce (No 1) (2017) 270 IR 410 [103].
63 One Key Workforce (No 2) (2018) 356 ALR 535 [115].
[2019] FWCFB 4022
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[73] The information available to the Deputy President from the combination of the
Respondent’s statutory declaration and its subsequent submission is at best scant as to the
content of the explanation it gave its employees. The sum of that information was as follows:
the agreement was similar to an enterprise agreement which had previously applied
to former mining operations undertaken by a parent company of the Respondent and
which was well known to all of the employees (who had previously been employed
under this agreement). All amendments to the previous agreement were clearly
highlighted to make it easy for the employees to identify any changes. Employees
were invited to discuss any concerns with management;
a meeting was held on site on 17 April 2018, involving three members of
management and all of the relevant employees during which the attendees went
through the Agreement in detail, from front to back, discussing each of the terms of
the Agreement;
during that meeting, employees asked a range of questions about the Agreement,
which were answered by management;
a further meeting was held on 24 April 2018, with the same attendees, during which
the Agreement was again discussed at length;
throughout the bargaining/negotiation period and the access period, the Mine
Manager was based full time on site and was available to discuss the Agreement
with the relevant employees; and
the agreement provided for wages that were significantly more generous than the
Award.
[74] This informed the Deputy President that some explanatory comparison had been given
between the Agreement and another agreement that did not, at the time of the explanation,
apply to the four employees, but that had applied in the past when the employees worked for a
different, albeit related, employer. The information also informed the Deputy President of
meetings at which management and the employees “went through the Agreement, from front
to back, discussing each of the terms of the Agreement”, that questions were asked and that
the Mine Manager was available on site to discuss the Agreement.
[75] That information might be sufficient to support satisfaction that the terms of the
Agreement were relevantly explained, but it says nothing about what if any explanation had
been given to employees about the effect of those terms.
[76] The Deputy President’s conclusion as to satisfaction in relation to s.180(5) of the Act
is at [58] of the Decision, which is earlier set out in this decision. At [52] of the Decision, the
Deputy President distinguishes the decision in One Key Workforce (No 2). The Deputy
President reasoned that in One Key Workforce (No 2) there were no face-to-face meetings, the
agreement for approval covered classifications in 11 awards, and the three employees voting
on the agreement only worked across two awards and could not give informed consent in
regard to occupations and industries in which they did not work. He concluded that those
circumstances, or anything similar, do not exist in this application.
[2019] FWCFB 4022
21
[77] So much is correct, but, respectfully, there are further matters that require
consideration. In One Key Workforce (No 2), the Full Court made several observations about
the quality of the explanation required in order to comply with s.180(5) of the Act, and the
Commission’s approach to assessing compliance. It is important to remember that the Full
Court said of the Commission’s approach that
“[i]n 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 circumstances and needs of
the employees and the nature of the changes made by the Agreement”.64 [our
emphasis]
[78] As to the absence of information about the content of the explanation that had been
given, the Full Court observed, inter alia, that
“[t]he absence of that information meant that the Commission was not in a position to
form the requisite state of satisfaction. Put differently, 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”.65 [our emphasis]
[79] As should be evident from the terms of s.180(5) of the Act, the content of the
explanation required is twofold. First, there must be an explanation of the terms of the
Agreement. Secondly, the effect of those terms must be explained.
[80] Having regard to the information that we have earlier reproduced about the
explanation given to relevant employees, we are not persuaded that there was any information
based on which the Deputy President could have concluded to the requisite level of
satisfaction that the Respondent explained the effect of the terms of the Agreement to relevant
employees. This is because there is no information that discloses the content of that
explanation (as to the effect of the terms), or that such an explanation was given.
[81] Although the Deputy President was correct that there is no express legislative
requirement for an employer to raise any less beneficial provisions of an agreement with
employees in providing an explanation as to the terms of an agreement or the effect of those
terms, it does not follow that such an explanation will not be required in a particular case in
order that there can be satisfaction that the employer has complied with s.180(5) of the Act.
Much will depend on the circumstances of a given case.
[82] The circumstances in the instant case were that the relevant employees were, at the
time of the vote, entitled to the terms and conditions of the Award. The Award, and not the
other enterprise agreement with which comparisons were made, applied to the employees in
relation to their employment with the Respondent.
[83] The employer’s statutory declaration incorrectly deposed that none of the provisions
of the Agreement were less beneficial than the Award, when in fact there were clearly a
64 (2018) 356 ALR 535 [112].
65 Ibid [113].
[2019] FWCFB 4022
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number of less beneficial terms in the Agreement.66 That there were some less beneficial
terms in the Agreement compared to the Award is not in contest, since the Respondent
provided an undertaking addressing some of these in order for the Agreement to pass the
better off overall test.67 There was no evidence before the Deputy President that the
Respondent explained these less beneficial terms to the employees before they voted on the
Agreement. The Deputy President identified the potentially less beneficial nature of the
Agreement in respect of rates of pay,68 time off instead of payment for overtime,69 termination
of employment,70 shift start and finishing times,71 shift start and finishing places,72 meal
breaks,73 standing down employees without payment,74 the redundancy notice period75 and
safety compliance,76 although the last matter did not trouble the Deputy President vis-à-vis the
better off overall test.
[84] In the particular circumstances of this case, we consider that reasonable steps to
explain the terms of the Agreement and the effect of those terms included an explanation of
the less beneficial terms of the Agreement compared to the employees’ existing terms and
conditions under the Award.
[85] As we have already observed, the evidence as to the content of the explanation given
says nothing about what, if any, explanation was given to explain the effect of the terms of the
Agreement to relevant employees. It follows that it was not open to the Deputy President to
conclude that he was satisfied the Respondent took all reasonable steps to ensure that the
terms of the Agreement, and the effect of those terms, were explained to the relevant
employees. The Deputy President therefore erred in doing so. Accordingly, we uphold appeal
ground 3.
Grounds 7 and 8
[86] Grounds 7 and 8 also engage with whether the relevant employees genuinely agreed to
the Agreement. Ground 7 contends error in finding that the Deputy President was satisfied
that each employee had access to the relevant safety policies and procedures and that the
requirements of s.180(2) of the Act were met. The error is said to arise because the Deputy
President relied on a submission from the Respondent of a general nature, rather than sworn
evidence, in circumstances where the Commission had received sworn evidence that was
incomplete. Ground 8 contends that the Deputy President erred in failing to consider, as
required by s.188(1)(c) of the Act, that there were no other reasonable grounds for believing
that the Agreement had not been genuinely agreed to by the relevant employees.
66 Appeal Book p 74.
67 Ibid p 195, specifically [2], [5], [6], [10], [11] and [12].
68 [2019] FWCA 661 [72].
69 Ibid [83].
70 Ibid [93].
71 Ibid [98].
72 Ibid [101].
73 Ibid [104]-[105].
74 Ibid [110].
75 Ibid [115].
76 Ibid [117].
[2019] FWCFB 4022
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[87] The latter is advanced as an alternative to ground 3 on the basis of the Full Court’s
observation in One Key Workforce (No 2) that if it was wrong to conclude the Commission is
bound by s.180(5) of the Act to consider the content of the employer’s explanation of the
terms of the Agreement and their effect, then, in order to be satisfied that the Agreement was
“genuinely agreed to” having regard to s.188(a)(i), it would for similar reasons hold that this
was a matter which was not only relevant to the question raised by s.188(c), but also a
mandatory consideration.77
[88] As the matters on which the Appellant relies to make good this ground are the same in
substance as those raised by appeal ground 3 and we have upheld appeal ground 3 by
concluding that the Deputy President erred in being satisfied that there was compliance with
s.180(5) of the Act, it is unnecessary for us to consider this ground further.
[89] It is also unnecessary to deal with so much of ground 7 as is covered by sub-ground 3
(e). As to the remainder of ground 7, the Appellant contends that the Deputy President erred
in finding that he was satisfied at [40] of the Decision that each employee had access to the
relevant safety policies and procedures, and that the requirements of s.180(2) of the Act were
met by relying on a submission from the Respondent of a general nature, set out at [39] of the
Decision, rather than sworn evidence, in circumstances where sworn evidence had been
provided to the Commission, but was incomplete.
[90] This ground must be rejected. There is no requirement that the Deputy President
satisfy himself as to matters by way of sworn evidence as opposed to submissions. As
s.590(1) of the Act makes clear, except as otherwise provided in the Act, the Commission
may inform itself in relation to any matter in such a manner as it considers appropriate. The
Appellant does not set out any persuasive reason why it was not appropriate for the Deputy
President to satisfy himself as to employee access of incorporated policies during the relevant
period based on the Respondent’s submissions. The incomplete nature of the employer
statutory declaration, without more, does not provide a reason why a submission filling in the
“gaps” should not have been accepted. No appealable error is disclosed by this ground and it
is rejected.
Permission to appeal
[91] Having regard to the analysis above, we are persuaded that the public interest is
enlivened by the appeal, because the Appellant has identified appealable error, and because
there is public interest in ensuring that the requirements of which the Commission must be
satisfied when approving an enterprise agreement are properly considered, administered and
applied.
Conclusion
[92] For the reasons stated, we consider that it is appropriate to uphold the appeal on the
basis of grounds 2 and 3 of the notice of appeal. In those circumstances, it is appropriate to
quash the Decision. Given that the Respondent might wish to supplement the material filed in
support of its application to assuage the Commission’s concerns about its compliance with,
for example, s.180(5) of the Act, to consider an undertaking or to make a submission that the
Agreement was nevertheless genuinely agreed to by the employees covered by the Agreement
77 [2018] FCAFC 77 at [142]
[2019] FWCFB 4022
24
because the Commission can be satisfied as to s.188(2) of the Act, we propose to remit the
application for approval of the Agreement to Deputy President Bull for reconsideration.
Orders
[93] We order as follows:
1. permission to appeal is granted;
2. the appeal is upheld on grounds 2 and 3 of the Notice of Appeal;
3. the decision in [2019] FWCA 661 to approve the Ditchfield Mining Services
Pty Ltd – Coal Mining Enterprise Agreement 2018 with undertakings is
quashed; and
4. the application for the approval of the Ditchfield Mining Services Pty Ltd –
Coal Mining Enterprise Agreement 2018 is remitted to Deputy President Bull
for redetermination.
SENIOR DEPUTY PRESIDENT
Appearances:
Mr S Crawshaw SC for the Appellant.
Mr I Neil SC and Ms V Bulut of counsel for the Respondent.
Hearing details:
Sydney.
2019.
April 17.
Written submissions:
Appellant: 18 March 2019.
Respondent: 1 April 2019.
Printed by authority of the Commonwealth Government Printer
PR709204
GON MMISSION WORK IR WORKS THE SEAL( THE
