[Note: refer to the Federal Court decision dated 14 August 2012 [2012] FCAFC 108 for result of appeal.]

[2011] FWAFB 6684

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.604 - Appeal of decisions

The Australian Industry Group
v
ADJ Contracting Pty Ltd
(C2011/4401)

Electrical contracting industry

SENIOR DEPUTY PRESIDENT HARRISON
SENIOR DEPUTY PRESIDENT RICHARDS
COMMISSIONER ROE

SYDNEY, 13 OCTOBER 2011

Appeal against decisions [[2011] FWA 2380 and [2011] FWAA 1447] of Senior Deputy President Acton at Melbourne on 28 April 2011 and 4 May 2011 in matter number AG2011/364.

DECISION OF SENIOR DEPUTY PRESIDENT HARRISON AND

COMMISSIONER ROE

[1] ADJ Contracting Pty Ltd and its employees made an enterprise agreement and applied to have that agreement approved by Fair Work Australia (FWA). It was approved. An appeal against the approval is now made by a person not a party to the agreement on the grounds that certain clauses contained in it are contrary to the Fair Work Act 2009 (FW Act). The appeal does not raise discretionary considerations about whether the clauses are appropriate for the enterprise. The fact they are agreed suggests the parties decided they are. The appeal raises questions about the interpretation of a number of sections of the FW Act and their application to the clauses in contention.

[2] The appeal is made under s.604 of the FW Act by the Australian Industry Group (AIG) against the decision of Senior Deputy President Acton to approve the ADJ Contracting Pty Ltd Enterprise Agreement 2010-2014 (the ADJ agreement). This appeal was heard at the same time as matter C2011/4632 which is an appeal by the Construction, Forestry, Mining and Energy Union (CFMEU) against the decision of Senior Deputy President O’Callaghan to refuse to approve the Moyle Bendale Timber Pty Ltd Enterprise Bargaining Agreement 2010-2013 (the Moyle Bendale agreement). 1 It was accepted by all persons appearing before us that in relation to the matters raised by the grounds of appeal which are common to each appeal, the submissions made in one may be taken into account in the other. This is of particular relevance to the provisions of the FW Act which concern right of entry.

[3] We should indicate that Her Honour published two decisions and the AIG notice of appeal indicates it is made against both decisions. It was common ground before us that it was the first of Her Honour’s decisions containing her detailed reasons in respect of a number of objections that had been made to the approval of the ADJ agreement which was the focus of the appeal. Her Honour’s subsequent approval decision could only be understood in the context of her earlier decision. It was not suggested we need make any further ruling about this issue.

[4] Before us, Mr Wood appeared with Mr Tracey for the AIG and Mr Borenstein appeared for the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU). Mr Irving (who appeared for the CFMEU in the Moyle Bendale appeal) sought permission for the CFMEU to intervene in this appeal. Leave to intervene was also sought by Australian Mines and Metals Association Inc (AMMA) for whom Mr Follett appeared and the Australian Council of Trade Unions (ACTU) represented by Mr Fetter. In each case where counsel sought permission to appear it was granted. In each case where permission was sought to intervene to make submissions permission was granted. We note that the FW Act does not refer to an intervener however it was not in issue that an application to make submissions may be made by a person who is able to establish a relevant interest in the matters raised by the appeal grounds. 2

[5] AMMA supported the submissions of AIG and made some additional comments about them and the ACTU supported the submissions of the CEPU and the CFMEU. Generally, we will only refer to the submissions of AIG and the unions when addressing each ground of appeal but in doing so we have also taken into account the submissions made by AMMA and the ACTU about those grounds.

[6] The appeal is made under s.604 of the FW Act. The relevant parts of that section are:

The competence of AIG’s appeal

[7] As is clear from s.604(1) it is necessary for AIG to establish that it is a person aggrieved by the decision to approve the ADJ agreement. The CEPU submits it is not. It relies on the fact that the application for approval was made by ADJ Contracting Pty Ltd (ADJ Contracting) and supported by the CEPU. AIG did not represent ADJ Contracting and had no role in the negotiation of the agreement. The CEPU acknowledged that AIG had been granted permission to intervene before Her Honour. However, it submitted that AIG cannot be said to be aggrieved as it has put forward for approval enterprise agreements with clauses of the kind which it now seeks to challenge. Some examples were given. In these circumstances the CEPU submits that its appeal is incompetent. In the alternative it submits that AIG should not be granted permission to appeal.

[8] We accept that AIG has established that the clauses it challenges deal with issues of importance to it and its members. For reasons similar to those given by a Full Bench in Australian Industry Group and Pacific Brands Limited t/a Dunlop Foams 3 (Dunlop Foams) we have decided that AIG is a person aggrieved and has standing to bring this appeal.4

Permission to appeal

[9] Whether we should grant permission to appeal is a matter which we have decided with some hesitation. We are concerned about the grant of permission in circumstances where AIG does not represent ADJ Contracting and neither that company nor the employer association which did represent it have appeared. Additionally, it is accepted by AIG that it has represented members in relation to the approval of their enterprise agreements where those agreements contain clauses similar to those AIG now submits are objectionable. 5 Despite these concerns we have decided, on balance, that even though some aspects of the issues raised by this appeal have been considered by earlier Full Benches the scope of the matters now raised, and the submissions in support, concern matters of general importance to the approval of enterprise agreements and it is in the public interest to grant permission to appeal.

ADJ Contracting and NECA

[10] We wish to comment briefly on the absence of certain persons in this appeal. In the case of the ADJ agreement the bargaining representative for the employer was the National Electrical and Communications Association (NECA). It would seem that the agreement was one of a number of agreements which reflected the outcome of industry negotiations at a state level between NECA and the CEPU. Neither ADJ Contracting nor NECA appeared before us to make any submissions about the terms of the agreement they had reached, and in respect of which approval had been sought. We consider it unsatisfactory that NECA did not seek to support the terms of the agreement it had negotiated on behalf of its member ADJ Contracting and many others in a like position in the industry.

The issues raised by the grounds of appeal

[11] AIG indicated that the appeal raises four broad issues. They are as follows:

1. Whether clause 4.3(b)(v) of the ADJ agreement is an unlawful term because it has the effect of requiring or permitting ADJ Contracting to contravene the “General Protections” provisions found in Part 3-1 of the FW Act namely, s.340(1)(a) of the FW Act, which (read with ss341 and 342) provides that a person must not, as principal, take adverse action against a contractor or proposed contractor, because that contractor has a workplace right or proposes to exercise a workplace right, being a right arising from it being entitled to the benefit of a workplace instrument;

2. Whether compliance with clause 4.3(b)(v) of the ADJ agreement may, in the terms of s.192 of the FW Act, result in a person, namely ADJ Contracting or the CEPU, being liable to pay a pecuniary penalty in relation to a contravention of ss. 45E or 45EA of the Competition and Consumer Act 2010 (Cth)(CC Act);

3. Whether clause 15.2(k) of the ADJ agreement, which concerns right of entry, is an unlawful term because it provides for right of entry other than in accordance with Part 3-4 of the FW Act; and

4. Whether clauses 16.6(b) and (d) of the ADJ agreement, which concern inducement of employees to take union “membership action”, are unlawful terms because they require a contravention of s. 350 of the FW Act.

Clause 4.3(b)(v) - the first two grounds of appeal

[12] To place the first challenge to this clause into context we should reproduce two sections of the FW Act. The first is the definition of objectionable term in s.12 which provides that it means a term that:

[13] The next section is s.194. It reads as follows:

[14] The applicability of the above sections to this appeal arises in this way. Section 186(1) provides that if an application for approval of an enterprise agreement is made FWA must approve the agreement if the requirements set out in that section and s.187 are met. One requirement in s.186(4) is that FWA must be satisfied that the agreement does not include any unlawful terms. As can be seen from s.194 the meaning of unlawful term includes an objectionable term. So, the first ground of appeal is that Her Honour should have found that clause 4.3(b)(v) was an objectionable term because it has the effect of requiring or permitting ADJ Contracting to contravene s.340 of the FW Act (a section contained within Part 3-1 which deals with workplace rights).

[15] Although AIG’s submissions concentrated on clause 4.3(b)(v) we should reproduce all of clauses 4.3(a) and (b):

[16] Her Honour indicated that AIG’s argument was that the clause requires ADJ Contracting to contravene s.340(1) of the FW Act because it requires it to refuse to engage or use a contractor who has an enterprise agreement or other workplace instrument providing less generous terms and conditions of employment than those in the ADJ agreement. A similar argument was put to us. To fully understand this argument further provisions of the FW Act need to be referred to. Section 340, as we have earlier noted, is contained in Part 3-1 of the FW Act. It is in these terms:

[17] Section 341 must also be referred to. It defines what a workplace right encompasses.

[18] The focus of AIG’s submission is upon the reference to a “workplace instrument” in s.341(1)(a). That is defined in s.12 as an instrument made under, or recognised by, a workplace law and concerns the relationships between employers and employees. A “workplace law” is also defined in s.12 and includes the FW Act.

[19] Section 342(1) is a table containing the types of action that will constitute adverse action. Included in the table are actions that are taken by a person against an independent contractor both where a contract has been entered into and where it is proposed to enter into a contract. It is adequate to identify some of the actions. Examples include where a person terminates the contract or refuses to engage the contractor, injures or discriminates against them in relation to the terms of the contract, alters the contractor’s position to its prejudice or refuses to make use of the services of the independent contractor.

[20] We now turn to Her Honour’s decision on this challenge. She said:

[21] Her Honour noted that her conclusion was consistent with the decision of a Full Bench in Asurco Contracting Pty Ltd v Construction, Forestry, Mining and Energy Union 6 (Asurco) which dealt with a clause similar in effect to clause 4.3(b)(v). That Full Bench said:

[22] AIG accepts that judicial consideration about what comprises a workplace right has generally been in the context of employee rights but it submits an employer also has a workplace right. That right is to employ its employees at a rate which is that prescribed in the relevant workplace instrument be it an award or an enterprise agreement. The effect of clause 4.3(b)(v) is said to require ADJ Contracting and like employers only to engage or deal with contractors who apply wages and conditions no less favourable than those provided for in the ADJ agreement. It submits this amounts to ADJ Contracting engaging in adverse action.

[23] We first refer to the comment made by Her Honour about her decision being consistent with the decision of the Full Bench in Asurco. Clearly it is. No adequate basis was established for Her Honour, as single member, to not follow that decision and no error is made out for her doing so. We do not understand that AIG sought to distinguish Asurco before Her Honour and, before us, it accepted it was appropriate for Her Honour in those circumstances to have followed it. However, AIG submits that to the extent Asurco is contrary to its submissions this Full Bench should find that it was wrongly decided and decline to follow it.

[24] We are not persuaded by AIG’s submission to decline to follow Asurco. In reaching this conclusion we have considered the comments of the High Court of Australia in Nguyen and Nguyen 7 (Nguyen) which was referred to in the Full Bench decision of Transport Workers’ Union of Australia and Australian Air Express8 (AaE) as to the “test” to be applied by a Full Bench when deciding to not follow a previous relevant decision on the same point. As was noted in AaE Full Benches of the Australian Industrial Relations Commission (the Commission) had traditionally taken the view that they should only depart from previous decisions in limited circumstances and, when considering an invitation to do so, the approach taken by the High Court in Nguyen was frequently quoted as being appropriate. It was acknowledged that although the then Commission (and now FWA) is not a court nonetheless the underlying public interest considerations apply with similar force to appeal proceedings and the same approach has been adopted. The relevant passage from Nguyen is as follows:

[25] We were not persuaded by the arguments of AIG that Asurco was wrongly decided. Indeed we think it is correct. AIG made additional submissions in support of this ground of appeal which were not addressed in Asurco. We have decided we should deal with them. The submissions concern the question of whether an employer (and in this respect here a contractor) has a workplace right within the meaning of s.341(1)(a). It relies in particular on that right being that of a person entitled to the benefit of a workplace instrument. It can be seen from the manner in which Her Honour dealt with the submission made to her she did not rule expressly on this issue, nor did Asurco.

[26] The CEPU submitted it had been unable to find any case which applies s.341 to contractors in the manner contended for by AIG. We too are not aware of any case which directly deals with this point. CEPU is correct to submit that without establishing that the contractor has a workplace right the whole of AIG’s argument must fail. To the extent the meaning of the section is unclear and resort may be had to the Explanatory Memorandum’s comments on this section all those comments refer to employee rights. 10 It is not common to describe an employer (here a contractor) being covered by an enterprise agreement as it being entitled to the benefit of that agreement. The only place in the FW Act in which the term “entitled to the benefit of.... a workplace instrument” is used is in s.341. We do however note the terms of the now repealed s.298L(1)(h) of the Workplace Relations Act 1996 (WR Act) which described a prohibited reason as one carried out because an independent contractor is entitled to the benefit of an industrial agreement. We also note that the then s.298N made it an offence for an employee to cease work in the service of an employer because the employer was entitled to the benefit of an industrial instrument. However we were not taken to any case which has described an employer as being entitled to the benefit of an industrial agreement when speaking about the wages and conditions to be afforded to its employees.

[27] Nonetheless, we proceed on the basis that we assume the term is capable of bearing the meaning for which AIG contends. However, the question remains, as the CEPU submits, whether the contractor is entitled with respect to the matters covered by clause 4.3(b)(v) of the ADJ agreement. It does not change the fact that compliance with clause 4.3(b)(v) in the ADJ agreement does not concern itself with the terms of any instrument covering the contractor and its employees. Further, and also assuming a workplace right, we agree with the CEPU submission that there is nothing in clause 4.3(b)(v) which, in terms of the s.12 definition of an objectionable term, “requires” ADJ Contracting to take any action against a contractor “because” the contractor is entitled to the benefit of an industrial instrument. ADJ Contracting’s concern is directed only at the rates of pay and conditions which the contractor is to apply. The clause requires no consideration be given to the existence, nor the terms, of any other agreement.

[28] Next AIG submits Her Honour was in error in failing to consider the effect of the reference in paragraph (b) of the s.12 definition of objectionable term to “permits” or “has the effect of permitting”. It submits that broadens the scope of the considerations as to whether clause 4.3(b)(v) requires a contravention of s.340 of the FW Act. It says that the effect of the reference to permitting is to allow a more hypothetical and broad ranging enquiry as to ADJ Contracting’s reason for not engaging a particular contractor. We are not persuaded by this submission. We think the better construction of the words in this part of the definition is that adopted by a Full Bench of the Commission when considering the construction of s.298Z of the WR Act. That section concerned terms of an agreement which required or permitted certain conduct that would contravene the FW Act. The section contained a definition of “permits” and like s.12 extended it to also include having the effect of permitting. This provision was considered by the Full Bench in Office of Employment Advocate v Construction Forestry Mining and Energy Union 11. The case concerned an application made by the Employment Advocate to vary a certified agreement to remove an objectionable provision. The Full Bench said:

[29] Applying the construction adopted in the above extract leads us to the same conclusion we reached in respect of earlier submissions. Clause 4.3(b)(v) does not permit or have the effect of permitting a contravention of s.340 of the FW Act.

[30] The next ground of appeal also concerns clause 4.3(b)(v). This ground relates to s.192 of the FW Act. It is submitted that compliance with the clause may result in a person, namely ADJ Contracting or the CEPU, being liable to pay a pecuniary penalty in relation to a contravention of ss45E or 45EA of the CC Act. Section 192 is in these terms:

[31] The relevant parts of s.45E are as follows:

[32] The only challenge made before Her Honour was by reference to s.45E of the CC Act. Section 45EA was not raised by AIG. About the challenge that it did raise before Her Honour she said:

[33] Insofar as Her Honour decided this ground of appeal on the submissions made to her we do not discern any error. The clause and the agreement in which it is contained reflect the concluded outcome of negotiations and a document which comprises an agreement made with a majority of employees who cast a valid vote for it. It is not, in terms in s.45E, the making of an arrangement or understanding with a union or any union official.

[34] Further, in our opinion the making of an enterprise agreement does not comfortably fit within the terms of s.45E. It is not, as the CEPU submits, the type of consensual agreement envisaged by that section. When approved it is a statutory instrument which operates in an entirely different legal context than an arrangement or understanding within the meaning of s.45E of the CC Act. When it is in the course of being negotiated it must be processed in accordance with the numerous requirements of the FW Act. 12 Also, the ADJ agreement is not one made with a union or any officer of a union as is a requirement of s.45E.13 As we have earlier noted it is made with employees and when a majority of those employees cast a valid vote for it. In fact an enterprise agreement will also cover persons who did not vote for it and persons not even yet in employment at the time of the vote but who may at any time it is in operation become employed.

[35] We are unable to categorise the ADJ agreement or any earlier drafts of the agreement (about which we have no evidence) as reflecting “a meeting of the minds and a consensus as to what is to be done”. 14 In this respect we accept the following submission of the CEPU:

[36] AIG raises an additional consideration in support of this ground of appeal. It notes that Her Honour decided the challenge it had made to the clause without expressing a view about whether an enterprise agreement could be categorised as an arrangement or understanding (AIG did not suggest it could be a contract). Her conclusion proceeds on the assumption there could be said to be an arrangement or understanding. AIG submits however we should make an express finding to that effect and, having done so, we should then find compliance with the agreement and clause 4.3(b)(v) in particular may result in ADJ Contracting having to pay a pecuniary penalty for the contravention of s.45EA.

[37] To succeed AIG must first establish there is an arrangement or understanding within the meaning of s.45E of the CC Act. In this respect it relies on the Federal Court of Australia judgment of Justice Smithers in Gibbins and others v Australasian Meat Industry Employees’ Union 16 (Gibbins) and the more recent Full Court judgment of Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Competition and Consumer Commission17 (Edison).

[38] The agreement in Gibbins which was found to also be able to constitute an understanding for the purposes of the then s.45D and s.45E of the Trade Practices Act 1974 (TP Act) was one between the operator of an abattoir, Borthwicks and the Australasian Meat Industry Employees’ Union and was reached as part of conciliation proceedings under the then provisions of Division 5A of Part 3 of the Conciliation and Arbitration Act 1904. Division 5A dealt with disputes relating to boycotts. That is, it specifically applied in relation to disputes about the contraventions of the then TP Act but, as s.88DG made clear, nothing in the division affected the operation of the TP Act. When proceedings had been commenced in the Federal Court of Australia an application could be made to the Commission. The Commission was empowered to settle such a dispute by conciliation. The observations made by His Honour about the status that may be assigned to a conciliation settlement that arose out of proceedings in the Commission are not, in our opinion, readily applicable here. We are not persuaded that Gibbins constitutes authority for the proposition that an enterprise agreement entered into in accordance with the provisions of the FW Act may be categorised as an arrangement or understanding.

[39] When Gibbins was referred to by the Full Court in Edison it was in the context of the Court considering the evidence in that case, constituted as it was by letters and a heads of agreement document, as demonstrating that an arrangement or understanding had been entered into between the CEPU and Edison Mission. There was also a memorandum of understanding about which we need not comment. As very little was said to us about the relevance of this case it is not readily apparent what we should make of it in the context of this ground of appeal. We can discern nothing in the decision which might persuade us that the ADJ agreement should be considered an arrangement or understanding in terms of the CC Act.

[40] We should not be taken to have decided an enterprise agreement could never be an arrangement or understanding for the purposes of s.45E of the CC Act. On the basis of the limited submissions made about this issue we do no more than indicate we are not persuaded to make the express finding AIG urges upon us which we have referred to in paragraph 36.

[41] We now turn to the reliance placed on s.45EA of the CC Act. As we have earlier indicated AIG also submits that compliance with clause 4.3(b)(v) may result in ADJ Contracting being liable to pay a pecuniary penalty in relation to a contravention of s. 45EA. It follows therefore that s.192 of the FW Act applies and Her Honour should have refused the approval of the ADJ agreement.

[42] Section 45EA reads as follows:

[43] AIG did not make this submission to Her Honour. CEPU did not say much about that presumably as it was able, in a few words, to dismiss the argument. It submitted that if s.45E has no application to the ADJ agreement then s.45EA does not arise. We agree and do not intend to make any comments about the undesirability of an appellant raising arguments for the first time on appeal which could have been made at first instance.

[44] AMMA raised a challenge to clause 4.3(b)(v) which it conceded was not raised before Her Honour. 18 It submitted that compliance with the clause may result in ADJ Contracting being liable to pay a pecuniary penalty under the Building and Construction Industry Improvement Act 2008 for a contravention of s.45 of that act. The submission has little immediate attraction. It is not at all clear how compliance with the clause would constitute an act of discrimination as provided for in s.45(1)(a)(i) or (ii). Compliance with the clause requires no consideration to be given to the kind of industrial instrument covering the contractor nor which person the industrial instrument is made with. This is not a matter raised by the grounds of appeal and we are not inclined to consider it further. The point was not developed in any detail and it is relevant to note does not appear to have been raised below by the Australian Building and Construction Commissioner (ABCC) who appeared before Her Honour. The challenge made by the ABCC to clause 4.3(b)(v) was referable to s.354 of the FW Act and was dismissed by Her Honour at paragraphs 29 and 30 of her decision.

[45] For the above reasons we dismiss the first two grounds of appeal. We have decided however to make a number of additional comments although the challenges to this clause have been decided for the reasons we have given. These comments merely serve to confirm the construction of the provisions of the FW Act we have adopted.

[46] Firstly, even if AIG had made out its ground of appeal that compliance with clause 4.3(b)(v) may lead to a contravention of s.45E and hence a pecuniary penalty it is not correct to submit, as it does, that Her Honour was obliged to refuse to approve the ADJ agreement. Section 192 does not require that result. It provides that a member may refuse, not must refuse, to approve it.

[47] If AIG had persuaded us that compliance with clause 4.3(b)(v) was an unlawful term then we would have needed to consider how the provisions of s.253 of the FW Act impact on this ground of appeal. That section provides that a term of an enterprise agreement has no effect to the extent it is an unlawful term. Similarly, s.356 provides that a term of a workplace instrument (here an enterprise agreement) has no effect to the extent it is an objectionable term. The way in which these provisions should interact with ss.186(4) and 194 would need to have been considered.

[48] Next we observe that it would be a surprising result if a term of an enterprise agreement such as clause 4.3(b)(v) which is a permitted matter about which an agreement may be made would nonetheless be an unlawful term under s.194. It is notorious that terms similar to this clause are in hundreds of enterprise agreements and such a term has been the subject of judicial and Commission consideration for many years. If it was intended that s.194 had the effect of disallowing such a clause in an enterprise agreement we think the legislation would have made that clear. If there had been a need to resort to the Explanatory Memorandum to assist in this respect we would note paragraph 672 of that memorandum which says:

[49] Finally, all of AIG’s arguments require us to assume a number of matters exist or will exist in order to make out the alleged unlawfulness. The CEPU rightly submits there was no evidence before us (or Her Honour) about ADJ Contracting. AIG’s answer to this is that we should use our imagination about how the clause will operate and to make a judgement or assessment looking forward. 19 But we are asked to do this with no knowledge of ADJ Contracting’s business activities, how many employees it currently has or will have, what jobs they bid for, what contractors if any they engage and the corporate status of those contractors, what those contractors industrial instrument coverage may be (eg if they have any enterprise agreement coverage - they may only have over award or site agreements which may not be workplace instruments)20 and what specialist skills the employees have. We think for us to make a guess about all of these matters is to use a little too much imagination and embark on an exercise beyond what the proper application of the provisions of Part 2-4 of the FW Act requires.

Clause 15.2(k)

[50] The next ground of appeal concerns clause 15.2 of the ADJ agreement. As we have earlier indicated AIG submits that this clause is an unlawful term and cannot be included in an enterprise agreement by reason of s.194(f) of the FW Act. We have set out that section earlier in this decision. Clause 15 is titled “Dispute Settling Procedures” and clause 15.1 deals with occupational health and safety issues. Clause 15.2 deals with the resolution of other issues. Although it is only clause 15.2(k) which is the focus of this ground of appeal it is appropriate the whole of the clause is reproduced. It is in the following terms:

(f) If a matter is submitted to the Disputes Board:

(i) The decision of the Disputes Board is binding on the parties, subject to the right to review in accordance with this clause.

(g) Where a matter does progress to FWA for arbitration or review, its decision shall be final and binding on the parties, subject to either party exercising any right of appeal against the decision to a Full Bench.

(h) In conciliating or arbitrating a matter under this clause, or conducting an appeal under this clause, FWA may exercise such procedural and other powers in relation to conferences, hearings, witnesses, evidence and submissions as are necessary to make the conciliation, arbitration, arbitration hearing, or review effective. To avoid doubt, in conducting a review, FWA is not confined to a consideration of the materials before the Disputes Board, and may deal with the matter afresh or conduct any hearing afresh and substitute its decision for that of the Disputes Board. In conducting a review, it is not necessary for FWA to determine whether the decision of the Disputes Board was affected by error.

(i) A decision of the Disputes Board or FWA made pursuant to this clause 15.2 must not be inconsistent with the National Code of Practice for the Construction Industry, the Implementation Guidelines for the National Code of Practice for the Construction Industry or legislative obligations.

(j) For the purposes of the disputes procedure:

(i) At all stages of this procedure, those involved in the dispute may seek the assistance of the Union, an employee representative, Employer representative (if any) and/or other representative.

(k) An Employee Representative or an official of the ETU shall be allowed to enter the workplace (excluding residential premises) to assist with representing an employee(s) under the dispute resolution clause in this Agreement provided that:

(i) prior to seeking entry:

(A) a dispute has been submitted to the Employer in accordance with clause 15.2(a) notifying the Employer of the nature of the dispute (as far as practicable), and which employees are affected (as far as practicable);

(B) a person involved in the dispute has sought the assistance of the representative (or official); and

(C) the parties have discussed mutually convenient arrangements for the entry, having regard to the operational requirements of the workplace;

(ii) the entry must not be used for any other purpose; and

(iii) the representative must not intentionally hinder or obstruct any person, or otherwise act in an inappropriate manner (which does not include actions involved in assisting the relevant employees in respect of the dispute), during the attendance or entry (or the representative has previously been found by FWA or the Disputes Board to have so acted in respect of that dispute).

Without limiting the rights or obligations of the parties in relation to a breach of this Agreement, any dispute about entry to the workplace will be dealt with in accordance with this procedure. For the avoidance of doubt, clause 15.2(b) will apply while the procedure is followed.”

[51] Any agreement for which approval is sought must have a disputes resolution clause. Section 186 of the FW Act contains a number of provisions which are described as requirements that must be met in order for an agreement to be approved. One such requirement is in s.186(6) and it provides that FWA must be satisfied that an agreement includes a term that provides a procedure to settle disputes about matters arising under the agreement or in relation to the National Employment Standards and that allows for the representation of employees covered by the agreement for the purposes of that procedure.

[52] Her Honour observed that a right of entry clause in an enterprise agreement was considered by a Full Bench of FWA in Dunlop Foams. She then set out a lengthy extract from that decision. We do not reproduce all of it and the following paragraphs are adequate for this decision:

[53] Having referred to the above Full Bench decision Her Honour then made the following comments about clause 15.2(k):

[54] AIG submitted to Her Honour, and submitted again to us, that the clause provides for entry by a union official for the purpose of investigating a suspected contravention of the FW Act or a fair work instrument and may also be entry for the purpose of holding discussions with employees. These are purposes referred to in ss.481 and 484 respectively. It is unlawful because it provides for a right of entry in a manner inconsistent with those sections which are contained in Part 3-4 of the FW Act.

[55] In the Moyle Bendale appeal, which relates only to the issue of right of entry and whether a clause in the Moyle Bendale agreement was unlawful, the CFMEU summarised in four points what it said was the proper construction to be given to ss194(f), 481 and 484. AIG agreed with this construction. The CFMEU points are as follows:

[56] We agree with the above construction. It is also a construction which is consistent with Dunlop Foams. That case of course concerned a clause in significantly different terms to clause 15.2(k). It was, as the Full Bench there described, a clause which granted a right of entry unrestricted by reference to purpose. Clause 15.2(k) as Her Honour observed, is clearly different to the terms of the clause in Dunlop Foams. The clause relates to the subject matter of dispute resolution. As we have earlier observed s.186(6) requires an agreement to have a dispute resolution clause and such clause must allow for the representation of employees covered by the agreement. That is precisely what clause 15.2(k) addresses. It also makes clear that the entry to enable the employee to be represented cannot be used for any other purpose. It can be invoked only when a dispute has arisen and then only in respect of an employee who has asked the representative to become involved. For these reasons we agree with Her Honour that the clause is not an unlawful term and accordingly this ground of appeal should be dismissed.

[57] If it was thought that despite all of the foregoing observations there remained a need to confirm the meaning of s.194(f) and that recourse could properly be had to the Explanatory Memorandum 21 the following paragraph would be informative:

[58] Clause 15.2(k) is the type of clause envisaged by the above extract from the Explanatory Memorandum.

Clauses 16.6(b) and 16.6(d)

[59] The final ground of appeal concerns clauses 16.6(b) and (d) and it is submitted that they are unlawful terms because they require a contravention of s.350 of the FW Act. AIG submits that the clauses require ADJ Contracting to induce its employees to engage in “membership action” within the meaning of s.350.

[60] Clause 16.6 is as follows:

[61] Section 350 is in these terms:

[62] Her Honour’s conclusion about this challenge was as follows:

[63] In support of its argument AIG relies on two decisions of the Federal Court of Australia both concerning proceedings between BHP Iron Ore Pty Ltd and the Australian Workers’ Union. 22 However, it did not develop its submission about the applicability of those cases in any detail. It is to be noted that in both of them the court was considering sections of the WR Act and s.298M in particular. The relevant sections there under consideration differ to s.350 although we accept one aspect is similar. We note that s.298M prohibited an employer by threats, promises or otherwise from inducing an employee to stop being an officer or member of an industrial association. The provisions of s.350 relate to inducing an employee to take or propose to take membership action and that membership action concerns both the employee ceasing to be a member of the association but also relates to the person becoming, not becoming or remaining such a member. Accepting the proposition made by AIG that “mere persuasion may be enough to establish an attempt to induce” the cases make it clear it will be a question of fact which will need to be determined on the evidence and by looking at all of the circumstances of the case. Unlike those court proceedings in which parties were represented, evidence was tendered and submissions made about the application of that evidence to the alleged breaches of the WR Act, here, there is no evidence and no relevant circumstances established about how ADJ Contracting will go about complying with clause 16. The fact the ADJ agreement contains clause 16 does not give it any immunity from s.350. In the event that some of the hypothetical actions AIG asserts do arise, and amount to inducing an employee to engage in membership action, then it would be exposed to the potential of proceedings under the section.

[64] In dismissing this ground of appeal we adopt Her Honour’s construction of the relevant provisions of the FW Act and the WR Act. Her reasons contain a detailed consideration of the current provisions and their previous counterparts. In this respect we refer to paragraphs 45 to 52 of her reasons. We agree with those reasons and do not identify in them any error. The word “induce” in s.350 does not mean promote or encourage. It follows that clauses 16.6(b) and (d) do not require ADJ Contracting to contravene s.350 of the FW Act.

[65] For the reasons we have given in this decision the appeal is dismissed.

SENIOR DEPUTY PRESIDENT

DECISION OF SENIOR DEPUTY PRESIDENT RICHARDS

[66] I have had the opportunity to read the decision of Senior Deputy President Harrison and Commissioner Roe, and agree with it other than in respect of its reasoning and conclusions in relation to the appeal grounds concerning clause 15.2 of the ADJ Agreement.

[67] My views in relation to whether clause 15.2 of the ADJ Agreement is an unlawful clause for purposes of s.194(f) of the Act are as follows.

[68] The clause before Her Honour for consideration was clause 15.2 of the ADJ Agreement, which reads relevantly for current purposes as follows:

[69] I note that the last paragraph in clause 15.2 of the ADJ Agreement, which concerns right of entry, was the subject of an undertaking under Regulation 2.07 of the Fair Work Regulations 2009 (“the Regulations”). For reasons of clarity, when reference is made to clause 15.2(k) of the ADJ Agreement in the foregoing, it is taken to be without reference to the final paragraph, to which the undertaking was sought (and about which no issue arises for purposes of this appeal).

[70] The issue the Senior Deputy President needed to determine for purposes of s.186(4) of the Fair Work Act 2009 (“the Act”) was whether clause 15.2(k) of the ADJ Agreement was an unlawful term within the meaning of s.194(f) of the Act. Section 194(f) of the Act reads as follows:

[71] Section 186(4) of the Act requires Fair Work Australia to satisfy itself that an agreement before it for approval does not include (amongst other things) an unlawful term for purposes of s.194(f) of the Act.

[72] Sub paragraph (k) of clause 15.2 of the ADJ Agreement (upon which Her Honour’s attention fell initially) stipulated the purpose for the right of entry under the clause. The sub paragraph reads as follows:

[73] The effect of this clause is that once an Employee Representative or an official of the ETU is seized of the requisite purpose (that being to assist with representing an employee under the dispute resolution clause in the ADJ Agreement) the Employee Representative or an official of the ETU may enter the employer’s premises (regulated only by the rules and procedures prescribed in the remainder of clause 15.2 of the ADJ Agreement, which are set out above).

[74] Her Honour’s reasons for her decision in relation to whether the entitlement to entry posited by clause 15.2(k) of the ADJ Agreement was an unlawful term is set out in the following two paragraphs of her decision:

[75] The elemental issue of construction of the clause asserted by Her Honour, therefore, was that the entitlement for the employee organisation to enter the employer’s premises so that it can represent an employee in a dispute resolution procedure under the ADJ Agreement was distinguishable in its purpose from an entitlement to entry for purposes of s.481 of the Act (which concerns a suspected “contravention of this Act, or a term of a fair work instrument”), or for purposes of s.484 of the Act (which concerns entry for “purposes of holding discussions with one or more employees [...]”). The terms of s.481 and s.484 of the Act are set out below.

[76] Because of her finding in this regard, Her Honour was of the view clause 15.2(k) of the ADJ Agreement was not an unlawful term for purposes of s.194(f) or s.194(g) of the Act.

[77] It is this finding that must be investigated, and which is the subject of appeal.

Observations about scope of the dispute resolution clause in the ADJ Agreement and consistency with procedures and rules in Part 3-4 of the Act

[78] Initially, it is useful to identify the scope of the application of the dispute resolution process provided for under the ADJ Agreement, which is set out in clause 15.2(a):

[79] An employee representative or official of the ETU therefore is provided with an entitlement to enter an employer’s premises to assist in representing an employee where “a dispute arises over”:

[80] Permitted matters are defined by s.172(1) of the Act.

[81] It is not immediately clear whether the scope of representation (and right of entry) in relation to permitted matters is intended by sub clause 15.2(k) of the ADJ Agreement to be confined to such matters to the extent that they arise under the ADJ Agreement itself, or more widely in respect of matters that can be covered by an agreement generally.

[82] Notwithstanding this, the ADJ Agreement affords an official of the ETU an entitlement to enter an employer’s premises in order to represent employees in disputes about a wide scope of matters relevant to the workplace and the ADJ Agreement.

[83] Sub clause 15.2(k) of the ADJ Agreement also entitles an official of the ETU to enter the employer’s premises in order to represent employees in relation to disputes about the application of the NES.

[84] The NES are statutory arrangements set out at Part 2-2 of the Act. A suspected contravention of the Act for purposes of s.481 of the Act, therefore, would include a suspected contravention of the NES.

[85] I observe also that the right of entry clause in the ADJ Agreement requires an official of the ETU not to hinder or obstruct any person or otherwise act in an inappropriate manner. However, any actions taken by the ETU official involved in assisting the relevant employee(s) in respect of a dispute are not taken as forming part of this obligation:

[86] Generally, it is enough to say at this point that the manner in which entry to the employer’s premises is to be effected under the ADJ Agreement is not consistent with the rules and procedures prescribed in Part 3-4 of the Act which condition the manner in which entry for purposes of s.481 and s.484 of the Act are effected.

Observations about the construction of Part 3-4 of the Act

[87] Before proceeding further, I will set out some of the provisions of Part 3-4 of the Act.

[88] Section 478 of the Act provides guidance that Part 3-4 of the Act is concerned with the rights of officials of registered organisations who hold permits to enter premises for purposes related to their representative role under the Act, and under other relevant laws.

[89] Section 480 of the Act states that the object of Part 3-4 of the Act “is to establish a framework for officials of organisations to enter premises that balances” three sets of distinct rights, these being:

[90] Section 480 of the Act does not condition or prescribe the range of representational functions or services an employee organisation might extend to its members in the workplace.

[91] In relation to the rights of officials of organisations, s.480(a) of the Act states that Part 3-4 provides the framework within which “the right of organisations to represent their members in the workplace, hold discussions with potential members and investigate suspected contraventions of the Act, fair work instruments” and relevant other laws is exercised in accordance with various rules and procedures.

[92] The purpose of Sub Divisions A and B of Division 2 of Part 3-4 of the Act is to give effect to the balance between the workplace representational and investigative rights of employee organisations, the rights to employees to receive those representational rights and other information from their employee organisations in the workplace, and for the employer not to be unduly inconvenienced when those rights are being exercised (by employee organisations and employees).

[93] Section 478 of the Act and, in particular, s.480 of the Act provide a statutory direction that the rights of entry for the purposes of s.481 and s.484 of the Act are intended (amongst other things) to give effect to an employee organisation’s rights to enter lawfully an employer’s premises in order to provide representation to employees in relation to suspected contraventions of the Act, which are particularised matters, or, more ubiquitously, by way of holding discussion with the relevant employee(s).

[94] The Act does not seek to regulate, and reasonably so it might be argued, the purpose of the holding of discussions with employees by organisations, other than that those discussions be for a representative purpose of the kind set out at s.480 of the Act. By so doing, the Part renders lawful the entry by an official of an organisation to an employer’s premises when it is for the broad purpose of holding discussions arising from the organisation’s representative role with any employees of the requisite type.

[95] If this were not the case, s.478 and s.480 of the Act would have no work to do whatsoever, and the scope of the meaning of the relevant sections (s.481 and s.484 of the Act) would not be construed in their immediate relevant statutory context.

[96] It appears to me that this construction of the jurisdiction by reference to the objects of Part 3-4 of the Act is the approach adopted by the Full Bench in The Australasian Meat Industry Employees’ Union v Dardanup Butchering Company Pty Ltd: 23

[97] In this construction, the Full Bench concerned itself with the purpose of holding discussions with employees under s.484 of the Act (which itself was for the purpose of persuading employees to become members of the union) and found that it was derived by reference to the objects of the Part, at s.480 of the Act.

[98] It follows from the above discussion that where a term of an agreement establishes an entitlement to a right of entry to an employer’s premises for purposes of exercising representational rights to employees in the workplace (that includes conduct in relation to investigating a suspected contravention of the Act or in any other relevant dispute or context which may extend to holding discussions with employees), that employee organisation is taken to be exercising an entitlement of the kind contemplated in s.481 and s.484 of the Act.

[99] Accordingly, where a term of an agreement is taken to extend to such a purpose, or includes such a purpose, and that purpose is not to be exercised in accordance with the rules and procedures of Part 3-4 of the Act, the term must be an unlawful term for the purposes of s.194(f) of the Act.

Clause 15.2(k) of the ADJ Agreement

[100] Clause 15.2(k) of the ADJ Agreement gives effect to an entitlement to right of entry so that the employee organisation (in this case an official of the ETU) may exercise representational rights and assist an employee (in a range of disputes). Does such an entitlement extend to or include an entitlement of the kind contemplated s.481 and\or s.484 of the Act?

Section 484 of the Act

[101] Her Honour’s finding, as set out above, was that the purpose of s.484 of the Act, which concerns the representational right of an official of an organisation to enter the employer’s premises for the purpose of holding discussion with employees, was distinguishable from the purpose of clause 15.2(k) of the ADJ Agreement, which concerned a right for an official of the ETU to enter the employer’s premises for the purposes of exercising representative rights to assist employees in disputes.

[102] On the basis of the above discussion, it seems to me that an entitlement to enter the employer’s premises under clause 15.2(k) of the ADJ Agreement would include an entitlement, for purposes of s.484 of the Act, which concerns the representational right of an organisation to hold discussions with one or more employees in the workplace. This is because the steps taken by an employee organisation to assist in representing any employee(s) in a variety of disputes, in its ordinary industrial context, must be taken to be an entitlement that without further qualification would extend to or include holding discussions with the affected employee(s) in the workplace.

[103] Indeed, it might appear unusual if the clause did not extend to or include entry for the purpose of holding discussions with employees. This is because if the clause did not extend to holding discussions with employees it would give rise to questions as to how the invitation for representation by the employee for purposes of clause 15.2(k)(i)(B) of the ADJ Agreement could be given effect in the first place, or how the very issue in dispute was ever elucidated for purposes of clause 15.2(k)(i)(A) of the ADJ Agreement (which requires the relevant official to advise the employer of the nature of the dispute and the identity of those affected).

[104] I also add that it appears to me that a perverse construction of the Act arises if an entitlement to right of entry for a representative purpose which, because it is unqualified includes or extends to holding discussions with one or more employees, is held to be distinguishable in purpose from an entitlement to right of entry for the purposes of s.484 of the Act itself. It is a perverse construction because s.484 of the Act would never be enlivened where a discussion with employees had a purpose, or conversely, s.484 of the Act would only be enlivened when the discussion was purposeless.

Section 481 of the Act

[105] Equally, it would appear, absent any qualification, that an entitlement to right of entry to assist any employee(s) in disputes about the application of the NES, a statutory condition of employment, would also extend to or include the activity of entering the employer’s premises “for the purpose of investigating a suspected contravention of this Act, or a term of a fair work instrument, that relates to, or affects, a member of the permit holder’s organisation:

[106] A dispute about the application of the NES ordinarily will include a concern about a suspected contravention of the NES. Absent any qualification, therefore, the entitlement under the clause to enter the employer’s premises to assist in representation in relation to a dispute about the NES will include or extend to investigating a breach of the Act (of which the NES is a part).

[107] Clause 15.2(k) of the ADJ Agreement therefore will include or extend to an entitlement to enter the employer’s premises for a purpose under s.481 of the Act.

[108] Beyond this, for the reasons I have discussed above, it is apparent from its terms that clause 15.2(k) of the ADJ Agreement does not operate in accordance with the rules and procedures governing rights of entry under Part 3-4 of the Act.

[109] For these reasons, clause 15.2(k) of the ADJ Agreement therefore must be an unlawful term for purposes of s.194(f) of the Act.

[110] Because clause 15.2(k) of the ADJ Agreement is an unlawful clause, Her Honour’s decision therefore is wrong.

Disposition in relation to Majority Decision

[111] I have set out above my reasons for my finding that clause 15.2(k) of the ADJ Agreement is unlawful for purposes of s.194(f) of the Act, and that the clause is not distinguishable for reasons of purpose from s.481 and s.484 of the Act. I will, however, briefly address some of the discrete lines of reasoning posed by the majority decision in the following, which are not considered above.

[112] It does not appear to me that the requirement for an agreement to have a dispute resolution procedure (assuming the scope of meaning given to the intended “procedure”) under s.186(6)(b) of the Act means that a clause in any agreement that meets that description as to purpose, and extends an entitlement to right of entry for that purpose by an organisation, will not be a clause that provides for right of entry in respect of an alleged contravention of the Act or a fair work instrument or for purposes of holding discussions with or one or more employees under s.484 of the Act. This is because the requirement of s.186(6) of the Act has nothing to say about entitlements to enter an employer’s premises for particular purposes, which are regulated by Part 3-4 of the Act.

[113] I add that s. 478 of the Act, as set out above, states that:

[114] It appears to me that where an official of an organisation performs a representative role under this Act, such as providing representation to employees in the workplace under the terms of an agreement by way of s.186(6)(b) of the Act, and exercises an entitlement to right of entry for that purpose, that clause may fall within the meaning of either or both of s.481 or s.484 the Act, unless otherwise qualified.

[115] The majority decision appears also to suggest that clause 15.2(k) of the ADJ Agreement is made permissible for reasons of or for further reason that (a) the clause cannot be used for any other purpose and (b) then only in respect of employees who have asked that the representative become involved.

[116] In relation to (a) above, the fact that the disputes clause, which establishes an entitlement to a right of entry, can only be applied for the purpose of assisting employees in a dispute does not cure the implication that the entitlement to right of entry may include or extend to holding discussions with one or more employees, as I have discussed above. The relevant issue as I see it is what happens as part of the representational process, not what happens in addition to it or beyond its intended terms.

[117] In relation to (b) above, the further fact that clause 15.2(k) of the ADJ Agreement applies only in respect of employees who have asked that the representative become involved appears to be a further reason for the permissibility of the clause. On the argument of the majority decision, however, such a qualification would not be a matter which is relevant to the lawfulness of the clause (under s.194(f) of the Act) as the clause cannot be a clause for purposes of s.481 or s.484 of the Act, and may be drafted to provide for right of entry on any terms whatsoever as a consequence.

[118] The majority also cited Item 838 of the Explanatory Memorandum to the Act in order to support its construction of whether an entitlement to right of entry is for purposes of s.481 or s.484 of Act.

[119] Item 838 of the Explanatory Memorandum reads as follows:

[120] The Explanatory Memorandum does not assist in the issue of construction discussed above. At best, it merely invites a circuitous debate as to whether a clause that is for a particular representative purpose can be taken to include or extend to another purpose (under s.481 or s.484) unless it is appropriately qualified.

[121] Generally, however, it seems to me that the task of construing what is an entitlement under s.481 and s.484 of Part 3-4 of the Act, which has its own objects, is not assisted by making reference to matters dealt with in the Explanatory Memorandum that purport to relate to Part 2-4 of the Act.

[122] Indeed, there is nothing in the plain words of either Part 2-4 or Part 3-4 of the Act that appear to reflect or otherwise require reference to the asserted intention claimed by the Explanatory Memorandum.

[123] For good reason, the task of properly construing Part 3-4 of the Act therefore relies generally on the ordinary principle of constructing the plain words of the Part (s.481 and s.484 of the Act) in their proper context.  25

[124] If further comment is needed on the difficulties of relying on extraneous sources as aides to construction, I add that neither the Second Reading Speech of the then Minister nor the Senate Standing Committee on Education, Employment and Workplace Relations Majority Report on the Fair Work Bill appear to make reference to the matters raised in Item 838 of the Explanatory Memorandum when dealing the right of entry provisions or agreement making under the Act. That is, there appears to be no consistency amongst the various extraneous resources.

Further Consideration: Full Bench in Dunlop Foams

[125] Her Honour’s finding, as set out above, was that the purpose of s.484 of the Act, which concerns the right of an official of an organisation to enter the employer’s premises for the purpose of holding discussion with employees, was distinguishable from the purpose of clause 15.2(k) of the ADJ Agreement, which concerned a right for an official of the ETU to enter the employer’s premises for the purposes of exercising representative rights to assist employees in disputes.

[126] In the appeal proceedings, support was lent to this approach by Counsel for the CEPU, who stated the central question on appeal in respect of this particular issue:

[127] A question of the correct approach arises. If an agreement establishes an entitlement to right of entry and asserts that the purpose of the right of entry is not for the purpose of holding discussions with employees, is that clause permissible, regardless, absent an attack on genuineness?

[128] The Full Bench in Australian Industry Group Re: Pacific Brands Limited t/a Dunlop Foams 27 (“Dunlop Foams”) considered a term which purported to establish an entitlement to entry by an employee organisation to “interview an employee”. The Full Bench characterised the clause before it as follows:

[129] The Full Bench found the clause, which established an entitlement to a right of entry so that the NUW was entitled to interview employees, “extends to” an entitlement to entry for the “purpose of holding discussions with one or more employees” under s.484 of the Act (even though the interview may have had other purposes as well, such as soliciting the views of employees about a union service or some such other issue).

[130] The asserted right to enter premises for the purpose of interviewing employees, according to the Full Bench, also “includes” the purpose referred to in s.481 of the Act (which concerns investigation a suspected contravention of the Act, fair work instruments and other laws).

[131] The Full Bench did not take the clause’s asserted purpose for the entitlement to right of entry (which was to “interview employees”) as being permissible on its face for reason that interviewing employees would be for that prescribed purpose only, and therefore was distinguishable from holding discussions with employees or investigating suspected breaches of the Act or fair work instruments.

[132] That is, the Full Bench did not assume that an official of the NUW when exercising rights “to interview employees” under the clause would do so in a manner that did not include or extend to an activity of the kinds contemplated under s.481 or s.484 of the Act.

[133] The Full Bench required more by way of particularised purpose(s) that distinguished the purposes for entry (which was to “interview employees”) from s.481 of the Act (which concerned investigating suspected breaches of the Act etc) and s.484 of the Act (which concerned entry for purposes of holding discussions):

[134] Absent any particularisation of purpose which defined the scope of its operation, the clause “includes” an entitlement to entry “for the purpose referred to in s.481” and was taken also on its own terms to “extend to the holding of discussions with employees, the matter dealt with in s.484” of the Act.

[135] I add that the transcript of proceedings demonstrates that in its submissions to the Full Bench the ACTU argued that the Full Bench should adopt the approach that a clause would only be unlawful for purposes of s.194(f) of the Act if it was for the purpose of s.481 and\or s.484 of the Act and was expressly for one or both of those purposes. As the clause before the Full Bench was for the purpose that was to “interview employees”, it was not unlawful because it was not an entitlement for the purposes of s.481 or s.484 of the Act, and no further construction should be imposed upon the clause:

[136] As is evident from its decision, the Full Bench rejected this argument. That is, the Full Bench did not accept the argument that the clause would only be applied for the purpose it prescribed (which in this case was “to interview employees”), and instead considered the scope of the clause’s meaning and what conduct it “extends to” and\or might “include” (unless further qualified by reference to its purpose).

[137] For these reasons, I consider the ratio of the Full Bench in Dunlop Foams to read conformably with my earlier findings.

[138] I add as a passing observation that it does not appear to me that every occasion on which an employee organisation seeks to enter an employer’s premises will be regulated by Part 3-4 of the Act. There will be other circumstances in which an employee organisation might lawfully enter an employer’s premises, but these circumstances are not the subject of this appeal.

Approval status of ADJ Agreement

[139] As I have found above, clause 15.2(k) of the ADJ Agreement is an unlawful term for purposes of s.194(f) of the Act, and s.186(4) of the Act therefore has effect. Section 186(4) of the Act reads as follows:

[140] Fair Work Australia cannot approve an agreement where it is not satisfied the applicable agreement does not include an unlawful term.

Disposition on Appeal and Conclusion

[141] I adopt the approach on appeal as it was applied by the Full Bench in Dunlop Foams 31.

[142] Section 604(1) of the Act provides that permission is required to appeal. Section 604(2) provides that Fair Work Australia must grant permission if it is satisfied that it is in the public interest to do so. As to my disposition on appeal, I would grant permission to appeal in the public interest, because the relevant considerations extend the construction of Part 3-4 of the Act. Such considerations necessarily attract the public interest.

[143] Further, for the reasons I have given above, I would uphold the appeal and quash the decision in [2011] FWA 2380. I would do so for the same reason as the Full Bench in Dunlop Foams cited above upheld the appeal in the circumstances before it, and that was because in my view:

[144] Having reached this conclusion, the remaining question before me concerns whether the error in the approval process cited above can be overcome by an undertaking pursuant to s.190 of the Act.

[145] Section 190(1)(b) of the Act applies to s.186(4) of the Act.

[146] Because of this, I would be prepared to accept a written undertaking from ADJ Contracting Pty Ltd if ADJ Contracting Pty Ltd gives a written undertaking (in addition to those it has already offered) in accordance with Regulation 2.07 of the Regulations that any right of entry to the workplace for a purpose referred to in s.481 of the Act or to hold discussions of a kind referred to in s.484 of the Act or for the exercise of a State or Territory OHS rights, will be dealt with in accordance with Part 3-4 of the Act .

[147] I would do so mindful, as I have noted above, that such undertakings may create difficulties in the operation of the clause.

[148] Acceptance of this undertaking would be contingent upon ADJ Contracting Pty Ltd both filing that undertaking with Fair Work Australia and serving it on the CEPU as a bargaining representative for the employees covered by the ADJ Agreement within seven days of this decision.

[149] If I receive from the CEPU, as a bargaining representative, within seven working days of receipt of the written undertaking by ADJ Contracting Pty Ltd its views about the undertaking I will consider those views for purposes of finally approving the agreement.

[150] If the CEPU’s views are not received in seven working days, I will approve agreement on the basis that Fair Work Australia has “sought the views” of the CEPU as a bargaining representative under s.190(4) of the Act. Section 190(4) of the Act does not require the views Fair Work Australia seeks of the bargaining representative to be receipted or received (though I note this was a requirement for approval of the ADJ Agreement made by Her Honour in her decision) 33.

[151] If I:

I would be satisfied that the requirements for approval of the ADJ Agreement had been met.

SENIOR DEPUTY PRESIDENT

Appearances:

S. Wood, Counsel with J. Tracey for The Australian Industry Group.

H. Borenstein, Senior Counsel for the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia.

M. Irving, Counsel for the Construction, Forestry, Mining and Energy Union.

M. Follett, Counsel for the Australian Mines and Metals Association Inc.

J. Fetter for the Australian Council of Trade Unions.

Hearing details:

2011.

Melbourne:

July 28.

 1   [2011] FWAFB 6761

 2   Sections 589 and 590

 3   [2010] FWAFB 4337

 4   [2010] FWAFB 4337 at paras 9-12

 5   PN 444 and 560

 6   [2010] FWAFB 6180

 7   [1990] 169 CLR 245

 8   PR959284

 9   [1990] 169 CLR 245, the judgement of Dawson, Toohey and McHugh JJ at para 21

 10   Paras 1359-1364

 11   [2003] 126 IR 468

 12   Sections 172-183

 13   We have not considered greenfields agreements in this decision,

 14   AIG submission paragraph 60

 15   CEPU submission paragraph 39

 16   [1986] 12 FCR 450

 17   [2007] FCAFC 132 at paragraph 98

 18   PN219

 19   PN 565 -567

 20   See for example the exchange at paras 102 - 111

 21   Section 15AB Acts Interpretation Act 1901

 22   BHP Iron Ore Pty ltd v Australian Workers’ Union [2000] FCA 430 and Australian Workers’ Union v BHP Iron Ore Pty Ltd [2001] FCA 3

 23   [2011] FWAFB 3847

 24   Ibid at PN 20.

 25   J.J. Richards & Sons Pty Ltd v Transport Workers Union of Australia [2010] FWAFB 9963 at PNS 28-31.

 26   Transcript of proceedings, 28 July 2011 at PN 515.

 27   [2010] FWAFB 4337

 28   Ibid at PN 8.

 29   Ibid at PN 35.

 30   Transcript of proceedings in Dunlop Foams, 21 April 2010 at PNS 244 - 246.

 31   [2010] FWAFB 4337 at PNS 25 - 27.

 32   Ibid at PN 36.

 33   [2011] FWA 2380 at PN 57.

Printed by authority of the Commonwealth Government Printer

<Price code G, PR515102>