REASONS FOR DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Downer EDI Mining – Blasting Services Pty Ltd
(AG2018/3315)

Application for approval of the Downer EDI Mining Blasting Services Queensland Coal Operations Agreement 2018 – CFMMEU a stranger to bargaining – CFMMEU a stranger to workplace – CFMMEU request to be heard generally under s.590 of Fair Work Act 2009 – detailed consideration of issues to be considered as part of s.590 request – concern that CFMMEU did not assist the Commission in the approval of this enterprise agreement – CFMMEU previously made greenfields agreement with Applicant employer in essentially the same terms as this enterprise agreement, yet now raises 17 objections as to terms previously agreed to by the CFMMEU and approved by the Commission – CFMMEU request to be heard revisited at end of hearing – compliance with s.180(5), all reasonable steps, genuine agreement, better off overall test.

[1] On 18 June 2019, I approved the Downer EDI Mining Blasting Services – Queensland Coal Operations Enterprise Agreement 2018 (“Agreement”) with undertakings. 1 The following sets out further reasons for that decision.

[2] At the hearing, Downer EDI Mining – Basting Services Pty Ltd (“Applicant”) was represented by Mr Jarrett Goos, Downer Group Employee Relations Manager, and the Construction, Forestry, Mining, Maritime and Energy Union (“CFMMEU”) was represented by Mr Adam Walkaden, National Legal Officer.

The Agreement

[3] The Agreement is a single-enterprise agreement. The Applicant lodged its application for approval of the Agreement with the Fair Work Commission (“Commission”) on 23 July 2018.

[4] The Agreement was made directly with three employees, who voted by majority to approve it on 17 July 2018.

[5] On 18 March 2019 this matter was allocated by the Commission Registry to the Chambers of Deputy President Boyce.

The Agreement replaces an earlier greenfields agreement made with the CFMEU

[6] The Agreement replaces the Downer EDI Mining Blasting Services Queensland Coal Greenfields Agreement 2015 (“Greenfields 2015 Agreement”). 2 The latter was approved by the Commission on 10 April 2015, to operate from 17 April 2015 until its nominal expiry date on 17 April 2018.

[7] The Greenfields 2015 Agreement was made with the Applicant and the (then) Construction, Forestry, Mining and Energy Union (“CFMEU”), now the CFMMEU, pursuant to s.172(2)(b) of the Fair Work Act 2009 (“Act”).

[8] The Agreement is in essentially the same terms as the Greenfields 2015 Agreement. Indeed, nearly all of the changes between the Greenfields 2015 Agreement and the Agreement reflect minor or technical variations and updates to existing terms and conditions.

[9] At the hearing of the approval of the Greenfields 2015 Agreement, the Senior Vice President of the (then) CFMEU – Mining and Energy Division (Mr Mitch Hughes) signed and submitted an F21 form (being a Statutory Declaration of an employee organisation in relation to an application for approval of a greenfields agreement). In that statutory declaration, dated 25 March 2015, Mr Hughes stated:

“Overall, prospective employees will be better off under the Downer EDI Mining Blasting Services Queensland Coal Greenfields Agreement 2015 than the wages and conditions contained in the Black Coal Mining Industry Award 2010 and the National Employment Standards”.

Composition of employees

[10] At the initial hearing, on 9 May 2019, Mr Goos for the Applicant made the following submission in respect of the composition of Applicant’s workforce (identifying underlying facts not challenged by the CFMMEU):

“The fact is that the composition of the workforce has remained remarkably static since it was negotiated last year and in fact since 2017 those three employees have been [the] sole employees covered by the current [greenfields] enterprise agreement and proposed [new] enterprise agreement. There has been no increase in the size of the footprint of the operations and it doesn't follow then that the company has ulterior motives.  Of course we would like to win work but this is not an unauthentic effort to gather three employees together to make an enterprise agreement.  Those three are legitimately covered by the agreement.

They have made their determination to represent themselves and they've chosen not to have the involvement or interference of a third party [such as the CFMMEU], and we say that those employees have been engaged fully and comprehensively in both the creation of the revised enterprise agreement and the decision making surrounding its application.  We believe that the CFMMEU see this as an opportunity to interfere in what is otherwise a direct engagement process with employees.  We note that those three employees have not sought assistance from the CFMMEU either at the time of bargaining or during the application process which has now gone for about 10 months.

We identify that this agreement is quite important for that small area of work and while it does have opportunity to expand and apply to a larger workforce there is no evidence that that's at all imminent and certainly this is a case that the applicant and subsidiaries of the broader Downer group have very good relationships with the CFMMEU in mining in Queensland and elsewhere, and again this is not an opportunity that we've taken to deny them an opportunity to be involved in the process.  It's simply that those individuals have exercised their rights to not have the union involved”. 3

Employees appoint themselves (in writing) as bargaining representatives

[11] The CFMMEU was not a bargaining representative in respect of the negotiation or the making of the Agreement. All three employees appointed themselves in writing as their own bargaining representatives at the time the Notice of Representational Rights (“NERR”) was issued. 4

[12] The CFMMEU did not assert that it had any members who were employed by the Applicant and involved in the negotiation or the making of the Agreement, or any members who will be covered by the Agreement at the time it is approved.

[13] The CFMMEU did not assert that it had any involvement or history of involvement with relevant employees covered by the Greenfields 2015 Agreement post the Greenfields 2015 Agreement being approved in April 2015.

[14] In view of the foregoing, the CFMMEU is a stranger to the negotiation and making of the Agreement, and thus a stranger in terms of its status and/or any right to be heard in these proceedings. 5 Further, on the evidence and submissions, the CFMMEU appears to be a stranger to the actual place of work in respect of the employees to whom the Greenfields 2015 Agreement covers and applies.

CFMMEU request for F16 and F17 application forms

[15] On 24 July 2018, one day after the Agreement was lodged with the Commission for approval, and presumably after the CFMMEU reviewed that part of the Commission’s website which publishes (to the public) enterprise agreements newly lodged with the Commission, Mr Walkaden wrote to the Commission’s Member Support Research Team (the Applicant was not copied into this email). Mr Walkaden’s email reads:

“Dear Sir/Madam,

We refer to the above matter, which we understand was filed with the Commission on 23 July 2018.

The CFMMEU have an interest in this matter and intend to seek permission to be heard in relation to the approval of this Agreement. Accordingly, could you please:

1. Provide a copy of the Form 16, Form 17, NERR and any other documents that were filed by the Applicant in relation to this Agreement;

2. Advise the member allocated to this matter of the CFMMEU’s desire to be heard in relation to the approval of this Agreement.

Furthermore, we respectfully request that until any issues as to the CFMMEU’s standing is determined, that we are provided with a copy of any Notice of Listings, Directions and relevant correspondence in relation to this matter.

We thank the Commission for considering these matters”.

[16] On 6 August 2018, the Commission responded to Mr Walkaden’s email (enclosing the Forms F16 and F17, and the NERR).

[17] I note that in CFMEU v Ron Southon Pty Ltd, 6 a Full Bench of the Commission held that the F17 application form should be treated as a document freely available to any member of the public unless there are exceptional circumstances that would justify some form of confidentiality.

[18] Although this approach of essentially ‘open’ standing or access (i.e. standing, or access, without exception or formal application) to obtain F17 application forms might accord with notions of open justice, it can equally end up enabling those who have had no involvement in the negotiation or making of an enterprise agreement (such as a union that has not been a bargaining representative (default or otherwise) for an enterprise agreement, or had or has no current members at the workplace), to identify a ‘desktop’ foundation upon which they might seek to be heard to oppose the approval of an enterprise agreement (i.e. solely on the basis of what is able to be extrapolated or said to be inferred (in an adverse way) from the face of an F17 form (or at least initially)).

[19] The foregoing situation can result (and in many cases does result) in significant delay and/or the complicating of an otherwise straightforward enterprise agreement approval process by the Commission. The flow-on effects are that the Commission’s valuable time and resources are tied up in a contested enterprise agreement approval process, being time and resources that might otherwise be devoted to other matters before the Commission.

[20] Further, employees who voted to approve the enterprise agreement are denied the expeditious granting of the benefits contained in the enterprise agreement whilst a ‘stranger’ delays the approval process by raising (in many cases) a smorgasbord of issues and arguments against approval. Such a stranger has no ‘skin in the game’ in advancing such opposition (i.e. the approval of the proposed enterprise agreement is either approved with a (in many cases lengthy) delay, or not approved). The only persons directly suffering or prejudiced from any such delay are the employees who democratically voted to approve the enterprise agreement and have its more beneficial terms and conditions (which must leave the relevant employees better off overall than the relevant modern award) apply to them.

[21] Of significance is the readily apparent conflict with the proper use of the Commission’s resources, the real interests (e.g. pay rises) at stake for the employees who voted to approve the enterprise agreement, and the Objects of Part 2-4 of the Act, which (in part) require the Commission to facilitate the making of enterprise agreements via “ensuring that applications to the FWC for approval of enterprise agreements are dealt with without delay” 7 (i.e. approved by the Commission, if compliant with the Act, without delay).

CFMMEU request to be heard pursuant to s.590 of the Act

[22] By way of written submissions dated 13 August 2018, the CFMMEU accepted that it had no right to be heard in the matter but sought to be heard in relation to its opposition to the approval of the Agreement pursuant to s.590 of the Act. In summary, the CFMMEU’s submissions stated that, despite the CFMMEU not being a “bargaining representative” 8 for the proposed enterprise agreement:

a) the CFMMEU has a history of involvement and expert knowledge in respect of the approval of enterprise agreements before the Commission, especially where the reference instrument for the better off overall test (“BOOT”) is the Black Coal Mining Industry Award 2010 (“Award”). In view of this involvement and history, the CFMMEU submitted that it is “uniquely placed to assist the Commission in ensuring that the Agreement complies with the FW Act” (my emphasis);

b) the Applicant is a wholly owned subsidiary of Downer, an ASX 100 company that employs around 56,000 people across more than 300 sites primarily in Australia and New Zealand. By contrast, the Agreement was made with only three employees and it is to cover and apply to all production and engineering employees directly involved in the supply of explosives and blasting services at all bar three coal mines in the State of Queensland;

c) as a general proposition, the Commission has been previously minded to grant the relevant union/s an opportunity to be heard, including where a large company makes an enterprise agreement with a very small number of employees (including where the CFMMEU has not been a bargaining representative). Further, the CFMMEU has been granted an opportunity to be heard in many other enterprise agreement approval applications before the Commission; and

d) in view of the foregoing, the Applicant is not a “start-up” company and “it can be expected” that the Applicant would seek to significantly increase its workforce post agreement approval (with such new employees being denied the opportunity to bargain for an enterprise agreement for at least 4 years, and some new employees likely to be CFMMEU members).

[23] Having regard to the foregoing, the CFMMEU submitted that it is appropriate that the CFMMEU be allowed to be heard and involved as a contradictor to enable the scrutiny that comes with a contested hearing to occur. The CFMMEU’s request to be heard and involved was not limited to the provision of written submissions, but extended to effectively ‘at large’ involvement in the proceedings (i.e. being heard orally at the hearing, and being able to cross-examine the Applicant’s witnesses or statutory declaration deponents).

Requirement for probative foundation or evidence where request to be heard is made pursuant to s.590 of the Act and makes adverse allegations or imputations against applicant (employer)

[24] In passing, I note that the CFMMEU provided no evidence to support its assertions as to the ‘expectations’ of the Applicant to increase its workforce into the future (see paragraph 22(d) above).

[25] Nor did the CFMMEU provide evidence to support its submissions that it “strains credibility to suggest that an employer in the coal industry will simply operate with less than a handful of employees” (see paragraph 36 below).

[26] The implication/s from the foregoing CFMMEU submissions are that the Applicant had or has intentions or otherwise proposes to seek to defeat the requirements of the Act (directly or indirectly) via employing a small number of employees to approve an enterprise agreement, only to substantially expand that workforce subsequently and effectively avoid bargaining with a larger workforce and/or the union. These are very serious allegations. They ought not be made, let alone accepted, without at least some sort of evidentiary or other foundation to support them.

[27] Given the enterprise agreement approval process is not by way of arbitrated hearing, it is accepted that a union (participating in an enterprise agreement approval hearing) need not necessarily bring evidence (or other foundation) as to the assertions it makes against the approval of a proposed enterprise agreement. However, in my view, the same situation does not apply (or exist) when a person (including a union) is making a request to be heard under s.590 of the Act, and making adverse allegations against an applicant (i.e. the employer seeking to have their enterprise agreement approved) as a basis upon which a request to be heard should be granted.

[28] I note that whilst the Commission is not bound by the rules of evidence and procedure (s.591 of the Act), this does not alter the need to actually bring evidence as to a contention or allegation made in proceedings, or at a hearing concerning a request to be heard.

[29] In my view, there ought be a supportable evidentiary or other foundation for any adverse allegation made by a person (including a union) who relies upon such adverse allegation in support of a request to be heard by the Commission pursuant to s.590 of the Act (i.e. beyond mere assertions from the bar table or otherwise contained in written submissions). This is especially so where serious allegations as to the conduct or purported conduct of an applicant are made to oppose the approval of an enterprise agreement (i.e. notwithstanding the very wide discretion conferred on the Commission under s.590 of the Act).

[30] The fact that a union simply has coverage, experience, knowledge and/or an interest in an industry is not, in my view, a prima face, let alone a sufficient, platform upon which to grant a request to be heard under s.590 of the Act. These are no more than neutral considerations.

[31] Indeed, where a person (such as a union) was not a bargaining representative for a proposed enterprise agreement, but in any event requests to be heard in the enterprise agreement approval process (simply because they have coverage under their Rules, experience, knowledge and/or an interest in an industry (and, inter alia, a purported interest in workplaces in that industry)), it almost becomes counterintuitive to grant such a request on the basis of those matters alone. I say this in circumstances where the Act could barely be drafted to do more to facilitate union representation in collective bargaining via bestowed privileges. 9 Noting of course that such privileges do not extend to an automatic right to appear in enterprise agreement approvals where the union has not been a bargaining representative. Compare, for example, s.34(2) of the Industrial Relations Act 1996 (NSW) which reads:

“(2) At proceedings of the Commission relating to any such application for approval, the following may appear or be represented:

(a) any party to the agreement,

(b) an industrial organisation, if its members or persons eligible to become members are affected by the agreement,

(c) a State peak council (but only with leave of the Commission),

(d) the President of the Anti-Discrimination Board (but only with leave of the Commission)”. (my emphasis)

[32] In my view, one must always be careful not to confuse or conflate the question of standing (or a request to be heard under s.590 of the Act) with merit arguments as to the approval of a proposed enterprise agreement. These are separate matters, and therefore ought be treated separately. A person does not gain standing to appear in a proceeding because of the arguments he/she wishes to make (i.e. such standing should exist on a stand-alone basis in the first place). The proverbial “cart before the horse” has direct relevance here.

Applicant’s opposition to CFMMEU request to be heard pursuant to s.590 of the Act

[33] The Applicant opposed the CFMMEU’s request to be heard or otherwise involved in the matter.

[34] On 28 March 2019, I conducted a Directions hearing and set down a timetable for the Applicant to file submissions, and for the CFMMEU to file further submissions in-reply, on the question of the CFMMEU’s request to be heard.

[35] By way of submissions received 18 April 2019, the Applicant submitted (in summary) that the CFMMEU’s request to be heard pursuant to s.590 of the Act ought be rejected for the following reasons:

a) on ordinary principles of intervention, the CFMMEU has no standing to intervene in this matter and therefore should not otherwise be heard in relation to the approval of the proposed enterprise agreement (pursuant to s.590 of the Act or otherwise);

b) the three employees who were employed when the Agreement was approved on 17 July 2018 are currently the same (and only) employees employed by the Applicant who will be covered the Agreement. These employees have made a choice not to have the CFMMEU involved in the negotiation or making of the Agreement, and have each executed a document (in accordance with s.176(1)(c) of the Act) to unequivocally confirm that they want to be their own bargaining representative.

[36] By way of reply submissions dated 3 May 2019, the CFMMEU essentially repeated its submissions set out at paragraph 22 above, and further stated:

“It strains credibility to suggest that an employer in the coal industry will simply operate with less than a handful of employees. The employer tactic is evident”. 10

I reiterate that the CFMMEU provided no evidence or other foundation to support this contention.

Oral hearing on CFMMEU request to be heard pursuant to s.590 of the Act

[37] A hearing was conducted on the question of the CFMMEU’s request to be heard on the approval of the proposed enterprise agreement on 9 May 2019. At the hearing, Mr Walkaden appeared for the CFMMEU, and Mr Goos appeared for the Applicant.

[38] At this hearing, Mr Walkaden (relevantly, and by way of summary):

a) relied upon the CFMMEU’s written submissions dated 13 August 2018;

b) submitted that the CFMMEU’s request to be heard in the matter not be confined to BOOT assessment issues, but extend to the pre-approval enterprise agreement process, focusing particularly on what was explained to relevant employees in the lead up to the making of the enterprise agreement. The latter was said to arise on the basis of what was stated in the F17 form, being allegedly “self-serving statements” as to the reasonableness of the steps taken to explain the Agreement to the employees and the content of such explanation;

c) submitted that the CFMMEU ought be heard in relation to the approval of the Agreement before the Commission because of a “mismatch between three employees who made the agreement versus the size of the company and the expectation of course that if this agreement is approved the company will ramp up its labour requirements and those employees will be unable to bargain for a period of four years, and you can make a finding that a number of those employees will most likely be CFMMEU members”.

d) Finally, Mr Walkaden made the following submission:

“The guts of our submission, your Honour, is this; ….. the Fair Work Act - the primary scheme by which wages and conditions are fixed by the Fair Work Act is an enterprise agreement, and to maintain public confidence in the system in these circumstances where you have a mismatch between the number of employees who made the agreement versus those who most likely will be covered by the agreement, to maintain public confidence you should permit a contradictor such as the CFMMEU to be heard and make submissions in relation to matters that go beyond BOOT.  So that would be the response that I offer you to support our submission that we shouldn't be limited just to BOOT”. 11 (my emphasis)

[39] Mr Goos submitted (relevantly, and by way of summary):

a) there is no need or rational reason for the CFMMEU to be involved in the approval hearing at all;

b) the small (previous and on-going) size and/or composition of the Applicant’s workforce (three employees) is in contrast to the unfounded or baseless assertions of the CFMMEU that the Commission should be suspicious as to “unauthenticity” and/or the potential or likely ulterior motives of the Applicant (i.e. in making an enterprise agreement with a small number of employees so that the Applicant can later ramp up the workforce, and thus avoid CFMMEU involvement in the bargaining process (which it is implied) would likely occur if more than three employees were involved in the bargaining process); and

c) the assertions as to the Agreement failing to pass the BOOT by the CFMMEU are disingenuous in circumstances where the Greenfields 2015 Agreement (in essentially exactly the same terms as the Agreement) was previously made with the then CFMEU (including the unequivocal support of the CFMEU by way of statutory declaration from its Senior Vice President).

[40] In response, Mr Walkaden submitted (in part):

“We say that the Commission of course can undertake the process itself but what we do say is that we are well placed to assist you and the process will be a better process if we are involved.  Yes, it will be more complicated but it will be a better process because there will be a contradictor who will be able to make submissions, cross-examine witnesses and that will ultimately assist you in coming to the right conclusion, namely whether the pre-approval requirements have been met.  So those are the submissions that we make, your Honour.” 12 (my emphasis)

[41] At the conclusion of the hearing on the CFMMEU’s request to be heard, and for the reasons that follow, I acceded to allowing the CFMMEU to be heard, but only in relation to the BOOT.

Consideration and determination of CFMMEU’s request to be heard pursuant to s.590 of the Act

[42] The following sets out the basis for my discretionary determination on the CFMMEU’s request to be heard pursuant to s.590 of the Act. I did, however, have cause to revisit this request as set out at paragraphs 81 to 88 of these reasons for decision.

[43] The Applicant commenced bargaining (agreed to commence bargaining) on 6 April 2018 by issuing employees with a Notice of Employee Representational Rights (NERR). Employees each appointed themselves in writing as their own bargaining representatives on 6 April 2018. It follows that the CFMMEU was never a bargaining representative (i.e. even a default bargaining representative) in relation to the negotiation and making of the Agreement.

[44] As the CFMMEU was not a bargaining representative for the Agreement it does not have a statutory right to appear and/or be heard in relation to this application for approval of an enterprise agreement.

[45] The CFMMEU never asserted that it had any relevant employee members employed by the Applicant. The CFMMEU never asserted that it had any previous involvement or history of involvement in the workplace in relation to employees covered by the proposed enterprise agreement. The CFMMEU, however, sought to be heard under the discretion provided to the Commission by s.590 of the Act, which at s.590(1), allows the Commission to inform itself in relation to any matter before it in such a manner as it considers appropriate.

[46] The Full Bench in Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited¹³ stated the following in respect of s.590 of the Act in the context of the Commission’s enterprise agreement role:

“[75] We would make the observation however, that the Commission may choose, in a particular case, to hear from an employee organisation or any other person about the approval of an agreement even though the organisation or person may not otherwise have a right to be heard. The Commission has a broad power to inform itself in relation to any matter in such manner as it considers appropriate, including by inviting oral or written submissions from a person of organisation. (sic) (Section 590)”

[47] Pursuant to s.590(1) of the Act, taking into account all of the submissions of the CFMMEU, including as set out in these reasons for decision, and importantly by reference to Mr Walkaden’s submissions that the CFMMEU is “well placed to assist [the Commission] and the process will be a better process if we are involved”, I accepted that the CFMMEU was able to assist the Commission in its approval deliberations concerning the BOOT in this application, but no further. I considered the exercise of my discretion appropriate to this extent only, as on the facts and circumstances of this case, and by way of various (relevant) discretionary considerations more generally:

a) the CFMMEU was not a bargaining representative for the Agreement and, inter alia, was not involved at all in the bargaining process;

b) the CFMMEU has no history of involvement in the workplace;

c) in view of (a) and (b), any assertions by the CFMMEU as to the steps taken to explain the terms and conditions of the Agreement to employees (including the content of such explanation), and/or the alleged “ulterior motives” of the Applicant in making the Agreement with three employees, could only be advanced via conjecture, speculative assertions and/or the use of cross-examination in an to attempt to extract a supportive evidentiary or other foundation for such submissions. In relation to the latter, I do not accept that the enterprise agreement approval process ought give rise to a situation whereby asserted case theories of persons who have not been bargaining representatives (in this case the CFMMEU) are able to be advanced on the basis of evidence derived only via the forensic cross-examination of witnesses and/or submissions based upon alleged omissions or “self-serving statements” on the face of a F17 form. Importantly, the fact that an F17 form does not adequately or sufficiently disclose any matter/s that the Commission is required to consider as part its enterprise agreement approval function is, in my view, only a relevant consideration in circumstances where the Commission itself identifies it as an issue or concern and an Applicant elects not to avail itself of a subsequent opportunity to bring further evidence or make further submissions as to such purported deficiencies or concerns;

d) on a prima face basis, as confirmed by the High Court and a Full Bench of the Fair Work Commission, as long as an enterprise agreement is made with two or more employees, it does not matter that in due course it may come to apply to many more employees. To determine otherwise would be to read something into the Act that is simply not there; 14

e) the three employees chose to appointment themselves in writing as their own bargaining representative in accordance with the requirements of s.176(1)(c) of the Act (see also s.178A). This was done immediately after employees received the statutory NERR which draws an employee’s attention to their rights to appoint their own bargaining representative (including themselves), and that a relevant union will be their default bargaining representative if they are a member of such organisation and no alternative election is made;

f) the employees’ voted by majority to approve the Agreement. In my view, any delay (however short) in the enterprise agreement approval process, by way of permitting the CFMMEU to participate in these proceedings beyond the scope of the BOOT in this matter, can only lead to a likely longer approval process before the Commission. Such a delay will only prejudice employees covered by the Agreement in that the approval of the enterprise agreement, including the approval of relevant employee’s terms and conditions (i.e. wages and other benefits ‘better’ than the relevant modern award and/or NES), will be delayed. In this case, the Agreement was lodged for approval with the Commission on 23 July 2018, and was approved by the Commission nearly one year later (on 18 June 2019);

g) delay can have beneficial (or positive) and prejudicial effects on an employer. In this regard:

•  the positive effect is that an employer does not have to pay or provide the more beneficial terms and conditions (e.g. pay-rises) under an enterprise agreement until it is approved (i.e. retrospective orders for approval cannot be made and have no effect). The longer the delay, the more ‘benefit’ (or money saved) by an employer;

•  the prejudicial effect for an employer is that the nominal term of an enterprise agreement may be shortened if the approval of an enterprise agreement is delayed (i.e. where the enterprise agreement has a set nominal expiry date). The employer does not end up with the nominal term they originally bargained for, and may well need to recommence bargaining for a further enterprise agreement sooner. This can lead to rolling or perpetual on/off bargaining over many years, and even bargaining fatigue;

h) on a prima face basis, and absent any probative foundation as to undue pressure or coercion, there is no warrant for the Commission to look behind an employee’s decision to appoint themselves as a bargaining representative (undertaken in accordance with the requirements of the Act). To do otherwise would be to second guess the requirements of the Act, and be overly and unnecessarily cautious and protective;

i) the CFMMEU’s status as an industrial organisation of employees derives from its status as a registered organisation under legislation. Equally, the CFMMEU’s history of involvement in the black coal mining industry flows from its coverage under its Rules. These matters provide the CFMMEU with various “privileges” 15 as bargaining representatives, but they do not extend to the CFMMEU when it is not a bargaining representative.16 The rules and objects of an industrial organisation invariably provide for the organisation to “improve, protect, and foster the best interests of the union and its members”, however, union rules and objects are not a basis upon which a request to be heard under s.590 derives (or ought derive); and

j) ultimately, it is for the Commission (itself) to approve enterprise agreements pursuant to the statutory scheme and make its own inquiries as to any concerns it has. At one level, that ought to be the start and the end of the matter. The Act does not require or otherwise mandate that a contender be involved in the enterprise agreement process where a union has not been a bargaining representative. Although assistance can be helpful, it can equally be unhelpful, especially if it causes the Commission to have to chase down ‘false shadows’ or consider ‘sacred cows’ (such as actual, asserted or self-proclaimed standards as to terms and conditions of employment not arising for consideration under the statutory scheme or statutory tests, but sought to be maintained across an industry (directly or indirectly) by way of opposition to and/or delay of enterprise agreement approvals).

[48] Although not raised before me, I have also had regard to the fact that the Agreement replaces the Greenfields 2015 Agreement (which was made with the CFMEU). I consider such a matter neutral in terms of the exercise of my discretion under s.590 of the Act. It is neutral in that a relevant employer has no choice but to make a greenfields agreement with a relevant union when entering into an enterprise agreement in respect of a new business, activity, project or undertaking. The privilege (for a union) under the Act providing that an employer must (by necessity) only make a greenfields enterprise agreement with a relevant union, is not, in my view, to be extended to more than a neutral consideration when exercising a discretion in relation to a request to be heard under s.590 of the Act. Of course, the issue arises for different consideration on the question of “standing” in an appeal. 17

[49] By way of summary, in the context of the foregoing reasons, the following table sets out a general quick reference guide to the matters I have taken into account in exercising my discretion concerning the CFMMEU’s request to be heard under s.590 of the Act (limited to BOOT issues) in this matter.

The Commission’s role in approving enterprise agreements

[50] In Newlands Coal Pty Ltd v CFMEU,¹⁹ the Full Bench summarised the Commission’s role in determining whether an enterprise agreement should be approved as follows:

“[33] FWA does not have a general discretion under the Act to determine whether an enterprise agreement should be approved. Rather, s.186 imposes an obligation on the tribunal to approve an agreement if a valid application for approval of the agreement is made under s.185 and the requirements of ss.186 and 187 are met.

[34] Broadly, the directions of s.187 involve examining the steps followed in the making of the agreement and the lodging of the application. Section 186 broadly involves the content of the agreement. Essentially, the role is one of examining whether the procedures followed leading up to the agreement being made were in accordance with what the Act requires and whether the content of the agreement satisfies certain conditions that the Act imposes.

[35] There is also a requirement for FWA to consider whether the agreement contains unlawful matters. What is an unlawful matter is defined by s.194. Additionally, and despite the requirements of s.186, Fair Work Australia may refuse to approve an agreement if a term of the agreement would mean compliance with that term would involve a breach of a Commonwealth law (s.192). There is no general role for the Tribunal to examine the validity of provisions in the agreement.

[36] The tribunal has no general nor specific power to rectify matters in the agreement if the terms of the agreement do not meet the requirements of the Act. The tribunal can accept undertakings but those undertakings can only be accepted if they are regarding concerns over the meeting of the requirements of s.186 and s.187.

[37] In summary, the role of FWA is to decide on whether the prescribed rules for conduct and procedures have been followed in the making of the agreement and if an agreement is made did the parties agree to things which an agreement can be about and are the terms agreed sufficient to satisfy the tests set out in the Act.” 20

Legislative requirements

[51] Section 188 of the Act expands upon the meaning of “genuinely agreed” in s.186(2)(a).

[52] The Commission must approve a proposed enterprise agreement if it is satisfied that each of the requirements set out in s.186 and s.187 of the Act are met. If the Commission has a concern that the agreement does not meet those requirements, it may exercise its discretion to approve the agreement if it is satisfied that an undertaking it meets the particular concern. 21

[53] Section 188(a)(i) of the Act provides that for an enterprise agreement to have been genuinely agreed to by the employees (as required by sub-s.186(2)(a)) the Commission needs to be satisfied (amongst other things) that sub-s.180(2), (3), and (5) of the Act have been complied with. Section 188(c) requires satisfaction as to there being “no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees”.

[54] Section 180(5) of the Act requires that the employer must “take all reasonable steps” to ensure that the terms of the agreement and the effect of those terms are explained to the relevant employees.²²

[55] In The Maritime Union of Australia v Northern Stevedoring Services Pty Ltd,²³ the Full Bench discussed the construction of the expression “all reasonable steps” in the following manner:

“[33] The expression “all reasonable steps”, and the case authorities concerning that and similar expressions were discussed at length in the decision of the Industrial Relations Commission of NSW in Court Session Bluescope Steel Ltd v The Australian Workers’ Union, New South Wales.24 The following propositions may be derived from the Court’s analysis:

•  reasonable steps are what a reasonable man or woman would regard as being reasonable steps in the circumstances which apply;

•  the obligation to take “reasonable steps” depends on the particular circumstances existing at the time the obligation arises; and

•  a requirement to take all reasonable steps does not extend to all steps that are reasonably open in some narrow or theoretical sense (such as, for example, matters not directly within the particular knowledge or experience of a relevant party).

[34] Additionally in Parland Pty Ltd & Ors v Mariposa Pty Ltd²⁵ the Tasmanian Supreme Court said, in relation to a requirement for a party to use its best endeavours to achieve a particular object, that a failure to take a particular step had to be assessed by reference to its materiality to the failure to achieve the relevant object. The Court said:

‘In any event quite apart from authority it would seem to me to be an untenable proposition that a party could be held to have failed to satisfy a condition requiring it to use its best endeavors in relation to an application because it failed to take some particular step if in fact the application would have been unsuccessful even had that step been taken.’

[35] That proposition appears to us to be equally applicable to consideration of whether an obligation to take all reasonable steps has been complied with”.

[56] In the Federal Court decision Construction, Forestry, Mining and Energy Union v One Key Workforce Pty Ltd,²⁶ Flick J stated that the nature of the task of the Commission under s.180(5) of the Act, and other terms requiring its satisfaction or otherwise about a state of affairs, is to make a broadly-based value judgment.²⁷

[57] Justice Flick said that in respect of the requirements established by s.180(5) of the Act:

“[103] …The requirement imposed by s.180(5) to ‘take all reasonable steps to ensure that…the terms of the agreement and the effect of those terms, are explained’ is an important obligation imposed upon an employer to ensure that employees are as fully informed as practicable. The requirement is not a mere formality. Whatever steps may be necessary will depend upon the facts and circumstances of each particular case: but those steps are not satisfied by a person reading – without explanation – the terms of an agreement to an employee”.28

[58] Section 340(2) of the (now repealed) Workplace Relations Act 1996 required an employer to provide employees, prior to voting on whether or not to approve a collective agreement, a “reasonable opportunity to decide” as to whether they want to approve the agreement. As to what is “reasonable”, albeit it in a different statutory context, Gray J of the Full Federal Court in Blue Star Pacific Pty Ltd v Communications Electrical Electronic Energy Information Postal Plumbing & Allied Services Union of Australia 29, stated:

“[22] [T]he search must be for what is "reasonable". What will be reasonable will depend upon the circumstances of the particular case. There can be no absolute rules about what will and what will not constitute the prohibitions on the conduct of an employer, or what will constitute the employer’s obligations. Any decision on the facts of another case cannot be converted to a rule applicable to the instant case. Each case must be determined on all of the relevant facts, rather than on a selection of particular facts in isolation from the others. Further, it would be wrong to examine each fact alleged to detract from the reasonableness of the opportunity in isolation from each other such fact, and in isolation from all of the facts that may tend in the other direction. The determination of the question whether there has been a reasonable opportunity given involves a holistic process.

[23] Thus, the primary judge was correct to hold that s 340(2)(a) imposes an obligation on the employer to give the employees the reasonable opportunity for which s 340(2)(a) provides. His Honour was also correct to take the view that the reasonable opportunity had to be given to all of the relevant employees as a group. His Honour’s view that the words "to decide" should be construed to mean something like to engage in the decision-making process also appears to be correct. It does not follow, however, that there is a universal, or even a general, requirement to conduct a meeting. Whether a meeting would be an element of the provision of a reasonable opportunity must depend on the facts of each case. Similarly, the provision by the employer of misleading information about the agreement cannot lead to the automatic conclusion that there has not been a reasonable opportunity. The incorrect information must always be considered in the light of all other matters”. (my emphasis)

[59] In One Key Workforce Pty Ltd v Construction Forestry Mining and Energy Union 30 (“One Key”), the Full Court stated that the matters in s.180(5) of the Act were matters to which the employer was required to attend but were not jurisdictional facts for the purpose of the exercise of the Commission’s approval powers.³¹

[60] The Full Court in One Key went on to hold that a condition precedent to the exercise by the Commission of its jurisdiction under s.186 of the Act to approve an enterprise agreement was its satisfaction that the employer had complied, amongst other things, with s.180(5) of the Act. The Full Court held that satisfaction as to whether s.180(5) had been complied with involved an evaluative judgment as to whether “reasonable steps” were taken by the employer, and on the issues of compliance with s.180(5), and the requirement for “genuine” agreement, stated:

“[105] Furthermore, like many of the pre-approval requirements, satisfaction as to whether s 180(5) has been complied with involves an evaluative judgment, including because an assessment is to be made as to whether “reasonable steps” were taken by the employer. As Bromberg J said in Teys Australia Beenleigh Pty Ltd v Australasian Meat Industry Employees Union (No 2) [2016] FCA 2; (2016) 259 IR 164 at [75], in a passage cited by the primary judge at [119]:

These are difficult questions, upon which reasonable minds might sometimes (perhaps often) differ. The legislature’s intent was evidently that they be dealt with — for the benefit of employees and employers both — by independent specialists and experts, through the process of Commission scrutiny. ...

…

[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 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?

…

[141] Turning then to the language utilised in ss 186(2)(a) and 188(c), the word “genuinely” in the phrase “genuinely agreed”, indicates that mere agreement will not suffice and that consent of a higher quality is required. We reject OKW’s contention that the phrase is only directed at requiring an absence of fraud, coercion or duress in the process of employees providing their agreement. The word “agreed” on its own, suffices to achieve those ends. The word “genuinely” must be given some additional work to do. A court construing a statutory provision must strive to give meaning to every word of it: Project Blue Sky at [71]. The limits OKW seeks to put on para 188(c) are too narrow. The requirement for genuine agreement in the Fair Work Act prescribes some, but not all, factors that must be taken into account. In this respect, in contrast to its predecessor, s 170LT(6) of the Workplace Relations Act, paras 188(a) and (b) direct the Commission’s attention to a number of discrete matters. Paragraph 188(c), however, it is not at all prescriptive.

[142] Paragraph 188(c) is cast in very broad terms. It is intended to pick up anything not caught by paras (a) and (b). Thus, any circumstance which could logically bear on the question of whether the agreement of the relevant employees was genuine would be relevant. One obvious example is the provision of misleading information or an absence of full disclosure (see, for example, Re Toys “R” Us (Australia) Pty Limited Enterprise Flexibility Agreement 1994 (1995) 37 AILR 3-068 (Print L9066) (C No 23663 of 1994)). Another is the likelihood that the relevant employees understood the operation of the various awards that would be affected by the agreement and the extent to which the wages and working conditions for employees under each of those awards would change, for better or worse, under the terms of the agreement. Thus, if we be wrong to conclude that the Commission is bound by s 180(5) to consider the content of the employer’s explanation of the terms of the Agreement and their effect, in order to be satisfied that the Agreement was “genuinely agreed to” having regard to s 188(a)(i), then for similar reasons we would hold that this was a matter which was not only relevant to the question raised by para 188(c), but was a mandatory consideration”.

[61] On the issue of the classification coverage of employees’ voting, the Full Court in One Key stated:

“[155] Where employees working in few occupational classifications consent to an agreement which covers numerous other occupations or other occupations in many industries beyond their own, an explanation of the terms of the agreement and their effect may fall short of providing an adequate basis for the formation of genuine consent. The employees who voted may be indifferent to the impact of an agreement on other employees or prospective employees in occupational classifications outside their own training or experience. As Buchanan J observed in John Holland (Besanko and Barker JJ agreeing), in those circumstances the employees will presumably act out of self-interest (at [33]) with the possible result that “it may not be fair for an enterprise agreement made with three existing employees to cover a wide range of other classifications and jobs in which they may have no conceivable interest” (at [83]).

[156] Therein lies the concern. The legislative objective of achieving “fairness through an emphasis on enterprise-level collective bargaining” could be undermined if the employees who vote on the agreement have no basis for appreciating its nature and terms. What is required by s 186(2)(a) is genuine agreement. To construe that requirement as mandating an informed and genuine understanding of what is being approved is consistent with the text of the provision (as defined) and accords with its underlying purpose.

[157] Ordinarily, non-greenfields agreements are made with the participation of the employees who are representative of the range of employee classifications covered by the enterprise agreement. The capacity to provide consent based upon a true understanding of the consequences of the proposed agreement across the breadth of classifications covered is likely to be adequate, including because representatives of each classification or classificational grouping will be involved. While it is correct to say, as OKW submitted, that the group of employees who vote are not required by the Fair Work Act to be representatives for, or agents of, the wider group of employees who may ultimately be covered by the agreement, the fact that the group does not broadly reflect the occupational scope of the proposed agreement restricts the terms and conditions in the agreement for which the group can genuinely speak”.

[62] Ultimately, the Full Court in One Key concluded:

“[172] Nevertheless, the primary judge was correct to find that the Commissioner fell into jurisdictional error by failing to have regard to the content and terms of the explanation OKW purportedly provided the employees before they cast their votes. In addition the Commissioner’s decision was affected by jurisdictional error because he failed to appreciate that, in determining whether the relevant employees had genuinely agreed to the Agreement he needed to consider whether they were likely to have understood its terms and effect”.

Satisfaction as to “genuine agreement” and s.180(5) and s.188(2) of the Act

[63] The facts and circumstances, along with the nature of any explanation given, mean that what constitutes “all reasonable steps” necessarily varies. 32 The term “all reasonable steps” does not give rise to the requirement for ‘perfection’.33 The assessment is a value judgement, and there are no absolute rules. It equally follows that what is required (by way of evidence) in terms of satisfaction by the Commission in terms of compliance with s.180(5), and genuine agreement (s.188), necessarily varies, and there are no absolute rules as to what is required or to be relied upon.

[64] The facts and circumstances in One Key are not the facts and circumstances of this case.

[65] The three employees to be covered by the Agreement have been employed by the Applicant pursuant to the terms of the Greenfields 2015 Agreement since 2017. I therefore infer that the employees have a prior understanding of the terms of the Greenfields 2015 Agreement, including the fact that it operates to displace the Award.

[66] In short, this is not a case where employees are moving from a modern award that applies to them to an enterprise agreement. Rather, employees are moving from an enterprise agreement that has passed its nominal term, to another enterprise agreement. The BOOT may be applied to the Award, but for all practical purposes for the employees at the workplace level, they are moving from one enterprise agreement to another. If the proposed enterprise agreement was not made or is not approved, the employees stay on the Greenfields 2015 Agreement, they do not fall back to the Award. The ‘main’ focus is thus what are all reasonable steps that were taken to explain the terms of the Agreement to employees from where they are currently at (i.e. the Greenfields 2015 Agreement). Yes, part of the focus is the fact that the Agreement will continue to displace the Award, but it would be wholly disingenuous to suggest that employees are not already aware of this (including the extent to which the Greenfields 2015 Agreement already displaces the Award).

[67] All three employees were involved in the drafting, bargaining and negotiation of the Agreement (between 6 April 2018 and 9 July 2018). 34 In my view, an inherently deeper and broader understanding of the terms of an enterprise agreement, and the effect of those terms, is to be attributed to employees who have been directly involved in the drafting, bargaining and negotiation of an enterprise agreement (being employees who have chosen to appoint themselves as their own bargaining representatives). This is not a situation where a union as bargaining representative has been involved in the drafting, bargaining and negotiation of an enterprise agreement and the employer is then explaining the terms and the effect of the terms of the enterprise agreement so bargained (for the first time).

[68] None of the three employees were non-English speaking or from non-English speaking backgrounds, none of the employees were under 21 years of age, and each employee was their own bargaining representative. 35

[69] Each of the three employees were “experienced mineworkers” (a fact not disputed by the CFMMEU). 36 They had all been employed under the Greenfields 2015 Agreement for over one year prior to bargaining for the Agreement commencing. The classification structure set out in the Agreement is straightforward,37 and there is no ambiguity as to the coverage clause of the Agreement. The Agreement displaces only one modern award.

[70] The changes between the Greenfields 2015 Agreement and the Agreement can only be described as updates, clarifications, or minor amendments to the terms of the Greenfields 2015 Agreement. 38 Significantly, the scope of the coverage clause of the Agreement has been reduced or narrowed (as compared to the coverage clause of the Greenfields 2015 Agreement), and employee classifications (being Levels 1-5) are exactly the same between the two agreements. The Agreement is therefore in form and substance a “pay-rise”. There have been no significant changes to the Award between the approval of the Greenfields 2015 Agreement and the making of the Agreement. The Agreement is thus a ‘roll-over’ of terms and conditions under the Greenfields 2015 Agreement.

[71] The evidence is that the terms of the Agreement and the effect of those terms were explained to the three employees to be covered by the Agreement on 9 July 2018 (at the start of the access period).

[72] These discussions were interactive, and employees were given every opportunity to raise any questions or queries in relation to the Agreement. I consider interactive discussions in relation to an enterprise agreement, and the ability for employees to ask questions about the terms of the enterprise agreement (including the effect of those terms) a significant factor in determining whether the terms of an agreement and the effect of those terms were explained to employees. Such interactive discussions obviously enable employees the ‘opportunity’ to clarify with an employer any explanation provided to them, and/or express dissent or concern. The approach must weigh (in the ordinary course) in favour of a finding that reasonable steps have been taken to explain the terms of an enterprise agreement, and the effect and content of those terms. The fact that some or all employees might attend such interactive discussions and not take the opportunity given to them to ask questions (or clarify other issues) does not, in my view, detract from what I have just said. One can of course lead a horse to water. It is the reasonable steps taken by an employer that s.180(5) is concerned with, not whether relevant opportunities were or were not taken up by employees when they had an opportunity to do so. Importantly, having regard to the fact that the opportunity for ‘question time’ is not in dispute, in reaching my requisite satisfaction in this matter, it was not necessary for me to go so far as to call for evidence or minutes of meeting/s as to what was said during any such ‘question time’.

[73] I note that in One Key (at [172]), the Full Court determined that the Commission needs to consider whether employees voting on the enterprise agreement were likely to have understood its terms and effect. In the ordinary course, this is to be considered in the context of the reasonable steps taken. But an employee need not have actually understood every term and its effect. Some employees might choose to obtain a better understanding than others (that is a matter for the employee themselves). An employer only need undertake all reasonable steps to achieve the end of “likely” understanding. Further, neither the starting nor the end point is the assumption that employees will vote “blind”, or that employees are simply incapable of understanding or ascertaining “what is in it for me” before voting on a proposed enterprise agreement. The question is: Are the employees ‘likely’ to have understood the terms and effect of the terms of the proposed enterprise agreement having regard to the steps taken to explain the enterprise agreement to them by the employer? The question is not: Did the employees actually understand or comprehend what was explained to them as a result of the reasonable steps taken? 39

[74] In view of the facts and circumstances of this case, I find that the Applicant has complied with s.180(5) of the Act and that the relevant three employees were likely to have understood the terms, and effect of those terms, of the proposed enterprise agreement (prior to casting their vote). I also make a finding as to genuine agreement by the employees. In doing so, I am of course also satisfied that there are no other grounds (reasonable or otherwise) to believe that the Agreement was not genuinely agreed to by the three employees who voted by majority to approve it (s.188(c)). 40

Employees will be Better Off Overall than the Award

[75] Section 193 of the Act deals with the BOOT. It reads:

“193 Passing the better off overall test

When a non greenfields agreement passes the better off overall test

(1) An enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if the FWC is satisfied, as at the test time, that each award covered employee, and each prospective award covered employee, for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.

FWC must disregard individual flexibility arrangement

(2) If, under the flexibility term in the relevant modern award, an individual flexibility arrangement has been agreed to by an award covered employee and his or her employer, the FWC must disregard the individual flexibility arrangement for the purposes of determining whether the agreement passes the better off overall test.

When a greenfields agreement passes the better off overall test

(3) A greenfields agreement passes the better off overall test under this section if the FWC is satisfied, as at the test time, that each prospective award covered employee for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.

Award covered employee

(4) An award covered employee for an enterprise agreement is an employee who:

(a) is covered by the agreement; and

(b) at the test time, is covered by a modern award (the relevant modern award) that:

(i) is in operation; and

(ii) covers the employee in relation to the work that he or she is to perform under the agreement; and

(iii) covers his or her employer.

Prospective award covered employee

(5) A prospective award covered employee for an enterprise agreement is a person who, if he or she were an employee at the test time of an employer covered by the agreement:

(a) would be covered by the agreement; and

(b) would be covered by a modern award (the relevant modern award) that:

(i) is in operation; and

(ii) would cover the person in relation to the work that he or she would perform under the agreement; and

(iii) covers the employer.

Test time

(6) The test time is the time the application for approval of the agreement by the FWC was made under section 185.

FWC may assume employee better off overall in certain circumstances

(7) For the purposes of determining whether an enterprise agreement passes the better off overall test, if a class of employees to which a particular employee belongs would be better off if the agreement applied to that class than if the relevant modern award applied to that class, the FWC is entitled to assume, in the absence of evidence to the contrary, that the employee would be better off overall if the agreement applied to the employee.”

[76] The BOOT is an evaluative determination, not to be conducted via a line by line analysis. 41

[77] The Agreement contains many terms which are more beneficial than the Award.

[78] The CFMMEU, having been granted the opportunity to be heard in relation to the BOOT pursuant to s.590 of the Act, raised seventeen (17) BOOT issues or objections. Three of those issues fell away in that the Applicant proffered an undertaking to clarify the position (without prompting from the Commission). The CFMMEU did not submit that any of the undertakings failed to resolve the concerns or objections they had made in relation to those issues.

[79] The following table sets out my reasons for the rejection of each and every one of the remaining BOOT issues or concerns raised by the CFMMEU.

Better Off Overall Test Analysis

Downer EDI Mining Blasting Services Queensland Operations Agreement 2018 (“Agreement”) analysed against Black Coal Mining Industry Award 2010 (“Award”) pursuant to objections made by CFMMEU

[80] In view of the foregoing, I am satisfied that the terms and conditions contained in the Agreement will result in employees (and potential employees) to whom the Agreement covers and applies being better off overall as compared to the Award. I make this determination as at test time (23 July 2018). I also find that given the high rates of pay under the Agreement, employees (and potential employees) are equally better off overall than the Award as at the date the Agreement was approved by the Commission (18 June 2019).

Did the CFMMEU assist the Commission in the Commission’s determination to approve the Agreement as submitted in its request to be heard under s.590 of the Act?

[81] I note that the CFMMEU made no comparison as to what it submitted were monetary or non-monetary detriments under the Agreement, as against or compared to the monetary and non-monetary improvements contained in the Agreement. As at BOOT test time (when the Agreement was lodged for approval), the wage rates alone under the Agreement are up to nearly 20 percent above the Award wage rates. The CFMMEU’s failure to conduct such an analysis does not assist the Commission in its determination of whether employees will be better off overall under the Agreement as compared to the Award. It is simply unacceptable for a union to raise objections as to detriments under an Agreement that have not been cross-checked with benefits under an Agreement, i.e. so that submissions are actually made about the BOOT (and not detriments alone).

[82] Further, given the nature of the BOOT issues and concerns raised by the CFMMEU, and having specific regard to the CFMMEU’s previous support for the Greenfields 2015 Agreement as passing the BOOT (i.e. which is in essentially the exact same terms as the Agreement), on 17 June 2019, I issued the following direction:

“At the hearing [on 18 June 2019], the CFMMEU should be prepared to explain why, of the 17 objections made to the proposed enterprise agreement and its approval, 15 of these 17 objections concern terms that are in the same or identical terms to the enterprise agreement approved in [2015] FWCA 2482 (being a greenfields enterprise agreement that was made with the CFMMEU).  More specifically, the CFMMEU should be in a position to explain why it has sought to engage the Applicant’s, and the Commission’s, time and resources in objecting to enterprise agreement provisions that is has previously agreed to, supported, not objected to and/or been involved in drafting.”

[83] In my view, it is unquestionable that the Commission may seek to clarify or otherwise revisit the basis upon which a person has previously been granted a request to be heard in a matter. This is especially so if submissions made (by the person making the request) in support of the granting of such request give rise to a subsequent concern or misapprehension by the Commission that, for example, it has not been assisted by allowing a person to be heard at the hearing, and that the approval of the Agreement, and thus the benefits flowing to the employees covered by the Agreement, have been delayed.

[84] Mr Walkaden addressed the Commission in respect of the direction set out in paragraph 82 above by making the following preliminary submissions (in summary):

a) the CFMMEU stands by its submissions and objections on the BOOT, and continues to press them; and

b) the only role for the Commission at this point in time is to consider the BOOT by comparing the Agreement to the Award, and determining whether relevant employees will be better off overall. This is the only matter the Commission should be concerned about. 42

[85] I rejected this submission and stated:

“Your [the CFMMEU’s] intervention was limited to the BOOT on the basis you'd be assisting the Commission.  So what I'm trying to understand is, how is it that when you sought permission to be involved in this approval process when you weren't a bargaining representative for the agreement, how this is assisting the Commission when it appears to me that the objections made have been merely made for the sake of making objections and delaying the approval process, which isn't something that assists the Commission.”43

…

“And you could have come along and said, well, you know, these are the issues we have.  But the difficulty is when you raise all these issues and you raise issues of ambiguity, assert that certain clauses don't meet the BOOT, and then there's an Agreement [the Greenfields 2015 Agreement] that the CFMEU made in exactly the same terms and filed the document in support of that and said that you [the CFMMEU] agree that it passes the BOOT, or effectively put to the Commission that that the Agreement [the Greenfields 2015 Agreement] passes the BOOT.  How is it that there's now 17 different issues that you've [the CFMMEU has] got?”44

“But instead you've gone on this wide-ranging analysis of the Agreement and effectively I've had to go through and check all these different issues, and I'm satisfied they pass the BOOT subject to the … undertakings that have been provided but I'm just trying to understand what the explanation is for the inconsistency in approach.”45

[86] This led to the following exchange:

“MR WALKADEN: The point I make there is that what the union would consider to be an acceptable deal in circumstances where there is a steady reduction in the coal price so that members are being made redundant right across the country, which is the subject of a number of decisions of this Commission and the Court, making those observations the union's view as to what is an acceptable deal in those circumstances to now is very different, your Honour.

THE DEPUTY PRESIDENT:  Where does that test come from, the union's view as to what's an acceptable deal?

MR WALKADEN:  I'm acting on instructions, obviously.  I'm acting on instructions and I'm just explaining to you the relevance of the position, in terms of what the union considers to be an acceptable position.  It's obviously influenced by - - -

THE DEPUTY PRESIDENT:  But you're intervening to assist the Commission in terms of the statutory tests of passing the BOOT.

MR WALKADEN:  Yes.

THE DEPUTY PRESIDENT:  And again, whatever the spot price of coal price was back then doesn't alter that position.  But I'm just struggling to understand that if your union has made an agreement, it's drafted clauses and then effectively comes along and says, well – for example, policies and procedures, they're matters that will lead to a breach of the agreement for failure to comply with policies and procedures, when the clause itself says they don't form part of the employment contract, and therefore they can't form part of the enterprise agreement.

And again it's a clause that your union either drafted or agreed to, and I've now got to – well, I've gone through an analysis of it and if you still press it I've got to set out reasons as to why it's an acceptable clause and it doesn't offend the Act, and all those things.

MR WALKADEN:  Your Honour, we stand by the submissions that we filed.  I'm trying to be honest with you.  I'm trying to give you, as opposed to – I'm trying to be as honest as I can be with you, to explain our position.

THE DEPUTY PRESIDENT:  Yes.  No, I understand.” 46

[87] I further stated:

“THE DEPUTY PRESIDENT:  Yes.  But I mean, the inquiry is not so much as the BOOT but it's going back to the representations that are made in terms of assisting the Commission by virtue of intervention or permission to appear and make submissions under section 590.  That's the issue I've got.

And whatever the union agenda is out there in the industry, I'm concerned that it's permeating into this approval process and therefore delaying the approval of the agreement and causing time and resources to be used in circumstances where the union's position at one point in time – and again, I've seen nothing that the award terms have changed so significantly that the effect of these clauses would be an alteration of the union's previous approval, or previous agreement to make the terms set out in the Greenfields agreement.

But I think we've probably taken it as far as we can.  So you still press these.  You want me to go through and set out reasoning in relation to each of the matters?

MR WALKADEN:  Yes, your Honour.” 47

[88] As I have previously stated in this decision, the enterprise agreement approval process is not one that gives rise to considerations such as “what [a] union would consider to be an acceptable deal” (generally, or from time to time). Nor does it give rise to intervention or requests to be heard under s.590 of the Act on the basis of what a union considers to be industry standards that have been achieved across an industry or in other workplaces under other enterprise bargaining agreements (but are not contained in an enterprise agreement before the Commission). Given these considerations are not part of the statutory scheme or the statutory test/s, there is little doubt that the Commission is not assisted by the raising of such considerations at an enterprise agreement approval hearing. I say this whether such matters are raised as straight up BOOT arguments, or disguised as arguments such as a failure to explain an agreement, or an absence of “genuine” agreement.

Approval of Agreement

[89] In approving the Agreement, for abundant clarity, I have considered and had regard to the evidence and submissions filed and otherwise made orally before me, including the F16 and F17 forms, and the Applicant’s undertakings. My satisfaction in respect of the requirements of the Act as set out in these reasons for decision are to be read together with my decision made on 18 June 2019. 48

DEPUTY PRESIDENT

Mr J Goos for the Applicant.

Mr A Walkaden for the CFMMEU.

Printed by authority of the Commonwealth Government Printer

<AE503998  PR711275 >

 1   [2019] FWCA 4245, PR709491, 18 June 2019.

 2   AE413466, 10 April 2015, Deputy President Ashbury.

 3   Transcript, 9 May 2019, PN26-PN28.

 4   Pursuant to written instruments all dated 6 April 2018.

 5   Australian Workers’ Union v Job Connect Recruitment Pty Ltd t/as Job Connect [2019] FWCFB 5132 at [14].

 6   [2016] FWCFB 8413, 19 Dec 2016.

 7   Section 171(b)(iii) of the Fair Work Act 2009.

 8   Section 176(1)(b) of the Fair Work Act 2009.

 9   CFMEU v Collinsville Coal Operations Pty Ltd [2014] FWCFB 7940 at [16].

 10   CFMMEU Reply Submissions, 3 May 2019 at [11].

 11   Transcript, 9 May 2019, PN22.

 12   Transcript, 9 May 2019, PN36.

13 (2014) 246 IR 21; [2014] FWCFB 7940.

 14   ALDI Foods Pty Ltd v SDA [2017] HCA 53; (2017) 262 CLR 593 at [84]; CFMMEU and AWU v LS Precast Pty Ltd [2019] FWCFB 1431 at [106]-[108].

 15   CFMEU v Collinsville Coal Operations Pty Ltd [2014] FWCFB 7940 at [16].

 16   Ibid.

 17   Construction, Forestry, Maritime, Mining and Energy Union v Mechanical Maintenance Solutions Pty Ltd [2019] FWCFB 3585.

 18   Section 171(b)(iii) of the Fair Work Act 2009.

19 [2010] FWAFB 7401.

 20   References in endnotes omitted.

 21   Section 190 of the Fair Work Act 2009.

22 Section186(2)(a) requires “genuine agreement”, which is defined in s.188(a)(1) and requires compliance with s.180(5), which in turn requires an employer to take all reasonable steps to explain the terms of the Agreement and their effect.

23 [2016] FWCFB 1926.

24 [2004] NSWIRC 222; 137 IR 176 at [67]-[71].

25 [1995] TASSC 91; (1995) 5 TASR 121 at 133.

26 [2017] FCA 1266, 270 IR 410.

27 Ibid at [43] – [44], citing the judgement of Buchanan J in Construction, Forestry, Mining and Energy Union v John Holland Pty Ltd [2015] FCAFC 16; 228 FCR 297; 247 IR 55.

28 [2017] FCA 1266, 270 IR 410 at [103].

 29   [2009] FCAFC 187; (2009) 181 FCR 416; (2009) 191 IR 323.

 30   [2018] FCAFC 77; 277 IR 2.

31 Ibid at 103.

 32   NTEU v University of NSW FWAFB 5163.

 33   CFMEU v Shamrock Civil Pty Ltd [2018] FWCFB 1722 at [36].

 34   F17 form, 23 July 2018, at Item 2.6.

 35   F17 form, 23 July 2018, at Item 2.7.

 36   Transcript, 18 June 2019, PN19

 37   F17 form, 23 July 2018, at Item 3.3.

 38   See summary of changes in Applicant’s Outline of Submissions filed 18 April 2019 at [11].

 39   McDonald’s Australia Pty Ltd v SDA [2010] FWAFB 4602 at [29]; 3D Earthmoving 2017 Pty Ltd [2018] FWC 622 (permission to appeal refused in 3D Earthmoving 2017 Pty Ltd [2018] FWCFB 2268).

 40   Section 188 of the Act.

 41   SDA v Beechworth Bakery Employee Co Pty Ltd t/as Beechworth Bakery [2017] FWCFB at [12], and Armaceli Australia Pty Ltd [2010] FWAFB 9985 at [41]

 42   Transcript, 18 June 2019, PN6-PN16.

43 Transcript, 18 June 2019, PN14.

44 Transcript, 18 June 2019, PN21.

45 Transcript, 18 June 2019, PN27.

 46   Transcript, 18 June 2019, PN44-PN52.

 47   Transcript, 18 June 2019, PN58-PN61.

 48   [2019] FWCA 4245, PR709491, 18 June 2019.