[2019] FWC 6198

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement

Application by CPB Contractors Pty Limited
(AG2017/5368)

COMMISSIONER SIMPSON

BRISBANE, 5 SEPTEMBER 2019

Application for approval of a single-enterprise agreement – Matter remitted from Full Bench – Judicial Review of Full bench decision –Agreement satisfies s 180(5) –No other reasonable grounds for believing that the Agreement has not been genuinely agreed – Group of employees fairly chosen – Undertakings offered regarding clause 9 and second paragraph of clause 3.3 - Certain other terms inconsistent with NES – Further undertakings required – Agreement meets requirements subject to undertakings.

Background

[1] This matter has some history. I refer to the earlier decisions of the Full Bench 1 and the Full Federal Court2 by way of background as I do not intend to revisit the entire background in this decision. The key points are summarised below.

[2] CPB Contractors Pty Ltd (“CPB”) applied to the Fair Work Commission (FWC) for approval of an enterprise agreement known as the CPB Contractors NSW Civil Works Enterprise Agreement 2017-2021 (the Proposed Agreement) on 7 November 2017. The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act).

[3] Throughout this decision for convenience I refer to the CFMMEU by its current name. The Agreement was initially approved by the FWC on 9 May 2018. 3 The CFMMEU appealed this decision and the Full Bench allowed the appeal in its decision of 26 September 20184 on two bases:

• The final provisions of cl 3.3 of the Agreement was rendered unlawful, by virtue of s. 194(ba) of the Act; 5 and

• The FWC Full Bench had erred in accepting an undertaking concerning cl 9 of the Agreement. 6

[4] The matter was remitted to me for rehearing.

[5] CPB Contractors sought judicial review of the aspect of the decision of the Full Bench on the question of whether the Commission could revisit the extent to which the final provisions of cl 3.3 of the Agreement may be unlawful under s.194(ba) of the Act.

[6] On appeal, the Full Federal Court concluded in its decision of 2 May 2019 that the Full Bench had erred in rendering the final provisions of cl. 3.3 unlawful, and made a Declaration to this effect. 7

[7] I conducted a Directions Hearing with representatives of the CFMMEU, the AWU and the Applicant by telephone on 13 May 2019. Following the telephone conference, I issued Directions for the filing of any further materials relevant to the grounds of appeal of the Full Bench decision and subject to the Declarations of the Full Federal Court. Parties subsequently requested the opportunity to file reply submissions and this was granted.

[8] At the Directions Hearing, it was discussed and settled that there were a number of matters which, although not the focus of the Federal Court appeal, were nonetheless open for me to consider on remittance, at the guidance of the Full Bench in their decision. The outstanding matters for my consideration were summarised at the Directions Hearing as:

a) the matters highlighted in paragraphs 27 and 28 of the Full Bench decision, specifically:

• The Applicant’s compliance with s.180(5) of the Act, relating to both the CFMMEU’s seventh ground of appeal, and the final paragraph of clause 3.3 – regarding “what, if anything, was explained to employees concerning clause 3.3 beyond some generic statements to be found in paragraph [2.6] of the statutory declaration made in support of the application for approval of the Agreement.” 8

• The CFMMEU’s fifth appeal ground concerning whether the Commission can be satisfied that the relevant employees genuinely agreed to the Agreement, by reference to s.188(c) of the Act.

It is noted that these are largely issues of evidentiary burden for CPB to satisfy, having regard to the guidance around the evidence required to satisfy the Commission provided in the One Key 9decision.

b) Appeal ground 8 in the Full Bench decision (the NES issues), specifically: whether the Commissioner erred in being satisfied that the Agreement did not contravene s. 55 of the Act, in circumstances where:

• Clauses 22 and 24, read in light of clause 6, operated so that adult employees would not receive the benefit of s. 62 of the Act; and

• Clause 26.10 operated so that employees would not receive the benefit of s. 107(3) of the Act.

c) Appeal ground 11 to the FWC Full Bench that the Commissioner erred in accepting an undertaking in relation to clause 14 that was ambiguous and contradictory, as well as aspirational. The Commissioner accepted the following undertaking;

“To mitigate any question, dispute or difficulty in relation to casual employees engaged under the Agreement, the award clause 14 Casual employment shall be applied, subject(sic) the Agreement prevailing in the event of inconsistency. Further CPB expressly commits to:

a. Casuals be engaged for a minimum of 4 hours

b. Casuals be advised prior to commencement of the anticipated duration of their employment and

c. Casuals have the same right to convert to permanent employment after six months continuous service, as provided by the award clause 14.8”

d) Appeal ground 12 to the FWC Full Bench that the Commissioner erred in accepting an undertaking in relation to clause 13 that was ambiguous and contradictory. The Commissioner accepted the following undertaking;

“To mitigate any question, dispute or difficulty, in relation to part-time employees engaged under the Agreement, the award clause 13 Part-time Weekly Hire shall be applied, subject(sic) the Agreement prevailing in the event of any inconsistency and substituting “38” with “36” ordinary hours in clause 13.1”

e) Appeal ground 13 to the FWC Full Bench that the Commissioner erred in accepting an undertaking in respect of clause 17 that was not capable of meeting any concern about the clause not complying with ss 186(2)(c)-(d). The Commissioner accepted the following undertaking;

“Clause 17 Redundancy does not undermine any rights or entitlements as prescribed by the Fair Work Act 2009 or National Employment Standards.”

[9] It was noted at the Directions Hearing on 13 May 2019 that appeal ground 10 had been appropriately remedied by CPB with an undertaking and therefore it would not be considered for the purpose of this decision.

[10] Appeal Ground 7 as contained in the Form F7 – Further Amended Notice of Appeal read as follows:

“7. The Commissioner erred in determining that the Respondent has satisfied the requirement under s.180(5) of the Act, in circumstances where:

7.1 the Respondent included erroneous information in the Form F17 Statutory Declarations filed with the application for approval in relation to the BOOT and NES and failed to disclose to employees that there were provisions of the Agreement less beneficial than the BOOT and which excluded, in whole or in part, provisions of the NES; and/or

7.3 the Respondent failed to identify and explain to employees that clause 3.3 of the Agreement, so far as it purported to allow the Respondent and employees, and the Respondent and trade unions, to make project/site agreements which would apply to particular projects or sites to the exclusion of the Agreement was unenforceable by reason of it being an unlawful term for the purposes of s194(ba)

7.4 there were material differences between the Agreement and the enterprise agreement that covered and applied to employees, being the Leighton Contractors (NSW/ACT) Civil Projects CFMEU, AWU, AMWU Enterprise Agreement 2012 – 2016 (2012 Agreement), including in relation to:

(a) the requirement to agree in writing, before a part-time employee commenced work, on the hours and days the employee would work and the period of part-time employment;

(b) the matters that could be the subject of an individual flexibility agreement;

(c) the taking of rostered days off adjacent to public holidays, in circumstances where work on these days under the 2012 Agreement was prohibited subject to limited and defined exceptions;

(d) the requirement for work crews to work through meal breaks for critical and emergency works;

(e) the removal of project based Consultative Committees to review and advise on key aspects of CPB’s business, including but not limited to consulting employees about major workplace changes;

(f) decisions under the dispute settlement procedure were required not to be inconsistent with the Building Code 2016 and implementation guidelines in respect of the Building Code 2016, in circumstances where the Respondent did not explain what, if anything, the requirement that decisions made under the dispute settlement procedure not be inconsistent with the Building Code 2016 and associated implementation guidelines entailed;

(g) the requirement that any supplementary labour engaged by CPB would be afforded conditions no less favourable than those set out in the 2012 Agreement.

[11] Appeal ground 5 as contained in the Form F7 – Further Amended Notice of Appeal read as follows:

“The Commissioner erred in determining that there were no reasonable grounds for believing that Agreement had not been genuinely agreed for the purposes of s.188(c) of the FW Act, in circumstances where:

5.1 clause 3.3 purported to allow the parties and the Respondent, and trade unions and the Respondent, to negotiate new project specific agreements which would cover and apply to the Respondent and employees at projects to the exclusion of the Agreement, in circumstances where this provision was an unlawful term for the purposes of s 194(ba) of the FW Act and otherwise contrary to s 58 of the FW Act;

5.2 the Respondent included erroneous information in the Form F17 Statutory Declarations filed with its application for approval in relation to the BOOT and NES and failed to disclose to employees that there were provisions of the Agreement less beneficial than the BOOT and which excluded, in whole or in part, provisions of the NES;

5.3 the Respondent told employees that unions could be parties to the Agreement and would be invited to become parties once an application for approval of the Agreement was lodged, in circumstances where the FW Act does not allow for unions to become ‘parties’ to an enterprise agreement.”

Submissions and statements

[12] The CFMMEU filed written submissions on 24 May 2019, and submissions in reply to CPB submissions on 6 June 2019. On 20 June 2019 the CFMMEU sent email correspondence to my Chambers drawing my attention to a recent FWC Full Bench decision in Construction, Forestry, Maritime, Mining and Energy Union v Ditchfield Mining Services Pty Limited 10and on 21 June 2019 the CFMMEU sent email correspondence to my Chambers drawing my attention to another recent FWC Full Bench decision in Construction, Forestry, Maritime, Mining and Energy Union v Mechanical Maintenance Solutions Pty Ltd11.

[13] CPB filed written submissions on 31 May 2019. CPB filed further submissions in reply to the CFMMEU 6 June submissions on 11 June 2019. CPB also sent to Chambers on 24 June 2019 a brief email responding to the matters raised by the CFMMEU in email correspondence to Chambers on 20 and 21 June. CPB for reasons set out below filed three further statements on 16 August 2019.

[14] CPB submitted on 31 May, in response to the CFMMEU submissions set out in detail below, that the statutory declaration Form F17 set out the steps taken to satisfy the applicant’s obligations under the FW Act as follows:

(a) On 12 and 21 September 2017, CPB held meetings with affected employees to commence the bargaining process. All employees were issued with a Notice of Employee Representation Rights and invited to include a union and/or nominate a bargaining representative;

(b) None of the affected employees appointed a union as a bargaining representative;

(c) Further meetings were held between CPB and its employees on 21 September 2017, 5 October 2017, 12 October 2017, 19 October 2017 and 26 October 2017 to negotiate the terms of the Agreement. The Agreement was to replace the Leightons Contractors (NSW/ACT) Civil Projects CFMEU, AWU and AMWU Enterprise Agreement 2012 -2016 (Former Agreement) which had applied to the employees;

(d) During the various negotiation meetings, the proposed terms of the Agreement were discussed, including wages and allowances and changes from the Former Agreement and employees were provided with a draft of the Agreement. It was explained that the Agreement would apply to employees of the applicant in certain classifications (those in the Agreement) on civil projects in New South Wales;

(e) On 26 October 2017, employees were provided with an agreement as a part of the access period. A vote was facilitated by a third party on 3 and 4 November 2017;

(f) At the time of the vote, there were 12 employees who would be covered by the Agreement. Of these ten cast a valid vote and they voted to approve the Agreement;

(g) On 7 November 2017, an application was made for approval of the agreement;

(h) On 16 November 2017, the CFMMEU corresponded with the Commission and provided submissions opposing the approval of the Agreement (Initial CFMMEU Submissions);

(i) On 6 March 2018 a conference was held by the Commission involving the applicant and the CFMMEU;

(j) On 7 March 2018, the CFMMEU sent correspondence confirming that, inter alia, it did not have any members employed by the applicant at the time of the Agreement being made who were within the scope of the Agreement;

(k) On 13 March 2018, the Applicant provided its response to the submissions of the CFMMEU in relation to a number of allegations raised by the CFMMEU (Initial CPB Submissions);

(l) The Interlocutory Decision was issued on 29 March 2018 and the Commission refused the application of the CFMMEU to be heard on the approval of the Agreement;

(m) By letter dated 24 April 2018, the Applicant provided undertakings to the Commission;

(n) On 8 May 2018, the Australian Workers’ Union (AWU) filed a form F18 statutory declaration in support of the Agreement and confirming that its concerns had been addressed by the provision of undertakings. It is apparent from the face of the statutory declaration that the concerns had been indicated on a previous occasion and were the basis of the undertakings which were subsequently provided;

(o) On 9 May 2018, the Commission issued the Substantive Decision approving the Agreement on the basis of the undertakings of the Applicant.

[15] CPB submitted that the Form F17 provides the evidentiary basis on which the FWC can satisfy itself that the legislative basis for approval has been satisfied.

[16] CPB submitted that as the CFMMEU was not involved in the negotiation of the Agreement, it cannot base its submission about failures in the Applicant’s conduct on any evidence of what actually occurred, and its submissions are based on pure speculation, are contrary to the matters in the Form F17 (which is a statutory declaration), and should be dismissed.

Procedural Fairness

[17] Ms Alice DeBoos, a partner of K&L Gates, provided a statement that included that she had received instructions from Mr Adam Carpenter, Industrial Relations Manager, to act on behalf of CPB in relation to the appeal lodged by the CFMMEU in relation to the approval of Proposed Agreement.

[18] Ms DeBoos said that Mr Carpenter provided him with the submissions of the CFMMEU dated 16 November 2017 and the Submissions of CPB in response dated 13 March 2018. Ms De Boos said that Mr Carpenter instructed her that he had drafted the CPB Submissions himself based on his knowledge and that he was the only CPB management employee responsible and involved with the bargaining process.

[19] Ms DeBoos also said in her statement that Mr Carpenter left the employment of CPB on or about 31 October 2019, (which I take as having intended to say 2018) to embark on a sailing trip around the world. Ms DeBoos said in or around April 2019 she asked Mr Brad Hooper, the current Industrial Relations Manager for CPB, to undertake searches to ascertain whether Mr Carpenter’s records of the bargaining process could be located and received instructions from Mr Hooper that he was not able to locate such records.

[20] CPB submitted that the Form F17 in the form of a statutory declaration is the only evidence required by the Commission to approve the Agreement. CPB submitted that should the Commission consider that further evidence would be of assistance from the Applicant, given the period of time that has elapsed since the approval of this Agreement by the employees and the initial hearing of the matter by Commissioner Riordan, the Respondent is severely prejudiced in this regard and this is a further reason to dismiss allegations made without evidence and reference to any material filed.

[21] CPB submitted that as outlined in the Statement of Alice DeBoos, Mr Carpenter was the CPB officer responsible for the negotiation of the Agreement, the lodgement of the Agreement and personally drafted and argued the Initial CPB Submissions. CPB submitted that Mr Carpenter left CPB’s employment in October 2018 and is not contactable and his records in relation to the bargaining are not available. CPB submitted that all of the complaints and concerns raised by the CFMMEU in the CFMMEU Initial Submissions were addressed directly by Mr Carpenter, based on his first-hand knowledge, in the CPB Initial Submissions, and these were accepted by Commissioner Riordan as evidence of the facts.

[22] The CPB Initial Submission prepared by Mr Carpenter of 13 March 2018 was 11 pages in length. The first two pages were concerned with an objection to the CFMMEU being heard.

[23] On page three of the Submission Mr Carpenter stated that the CFMMEU accusation against CPB “of withholding important information and the effects of the proposed Agreement” was false as all employees were consulted and participated in negotiations in a manner consist with process and objectives of the Act. The submission said the process was outlined in the Form F17. The Submissions also stated that negotiations were based upon the drafting of the expired Agreement being replaced and the employees were very familiar with the terms of the Agreement and the effect of those terms and the objection citing s 180(5) was baseless.

[24] The Submission denied the allegation that CPB failed to select all employees covered by the Proposed Agreement and provided particulars.

[25] The Submission responds to the CFMMEU submission that CPB did not accurately identify less beneficial terms when compared to the Award and the NES. The Submission stated that this is false as CPB has made application for approval of an Agreement which provides far superior terms and conditions and readily passes the Act’s BOOT. The Submission stated that the objective of the Act is not to identify every single difference between the Agreement and Award or NES, but as the sum of the parts or as the Act states “better off overall”. The Submission also states that CPB’s Form 17 reflects this objective and intention of the Act.

[26] The Submission responds to the CFMMEU submission that accuses CPB of not taking all reasonable steps to explain the terms of the Agreement and the effect of those terms by saying that this is false, and the Form F17 outlines the steps taken in making the Proposed Agreement.

[27] The Submission responds to the CFMMEU submission that accuses that CPB employees did not genuinely agree by stating this is false, and refers to the Form F17 and the vote was conducted via SMS by a third party.

[28] The Submission responded to a number of issues raised by the CFMMEU in relation to comparisons between the Award and the proposed agreement which it says are considered as part of the BOOT.

[29] In regard to the NES the Submission refers to clause 6 of the Proposed Agreement.

[30] In regard to the CFMMEU submission claim that the Agreement was not adequately explained, the Submission states that employees were very familiar with their old and new Agreement terms and their effect and operation, and CPB had taken all reasonable steps as outlined in the Form F17.

[31] The Submission said that CPB negotiated with all employees in person, meeting all employees face to face no less than three times to explain and negotiate the new Agreement, and the process allowed each individual the opportunity to ask questions and express their views about the new Agreement prior to voting.

[32] The Submission said that CPB strenuously objected to accusations made by the CFMMEU that the agreement was not genuinely agreed.

[33] The Submission said that the drafting was based on the expired Agreement and clauses disallowed by the Code for the Tendering and Performance of Work 2016 (Building Code 2016) and as assessed by the Australian Building and Construction Commission have been deleted and amended. The Submission said that all such changes were explained and understood, without question or difficulty by employees and none of these were financially material to employees.

[34] The Submission said that on balance the effect of the Agreement on employees is the same as the expired agreement except for changes to wages and allowances.

[35] The Submission said that in making the Agreement CPB discussed with employees and had the agreement of employees that the CFMMEU and the AWU, if not nominated by any employee to be a bargaining representative, could be given an opportunity to be a party. CPB wrote to the CFFMEU inviting them to be a party to the Agreement.

[36] The Submission said that a union can be a party to an Agreement, despite not being a bargaining representative, relying on the decision in CFMEU v Collinsville Coal. 12

[37] The Submission concluded by rejecting the CFMMEU’s grounds for objecting and submitting that the CFMMEU should be refused leave to heard as an objector.

[38] On 29 March 2018 Commissioner Riordan issued his decision denying the CFMMEU’s application to be heard.

[39] CPB submitted in its submission of 31 May 2019 that the CFMMEU now raises some new issues that were not the subject of objection in the CFMMEU initial submissions. CPB submits that it is severely prejudicial to CPB if those additional matters, not raised in the CFMMEU Initial Submissions, are given any weight. CPB submitted the CFMMEU had the opportunity to raise additional matters at the time and should not be afforded the ability to raise fresh objections.

[40] CPB submitted that the statement of Dean Reilly, a CFMMEU NSW Branch Organiser, does not contain any relevant information which goes to the approval of the Agreement. CPB submitted that Mr Reilly raises inferences that the workers who voted on the Agreement were not all the workers covered by the Agreement at the relevant time. CPB however submitted this is patently not the case and was directly denied by Mr Carpenter in the Initial CPB Submissions at para 4(a)-(f). CPB also submitted other elements of Mr Reilly’s statement were false.

[41] I do not accept the submission of CPB that submissions of the CFMMEU that go beyond matters that were raised in its initial submission of 16 November 2017 to Commissioner Riordan should not be given any weight. Commissioner Riordan refused to hear the CFMMEU on the matter. The submission filed by the CFMMEU on 16 November 2017 clearly stated that its objections included concerns that CPB did not take all reasonable steps to explain the terms of the Proposed Agreement, and that the Proposed Agreement was not genuinely agreed. Whilst it is true that the submission filed at the time did not raise some of the matters sought to be raised in the appeal grounds to the Full Bench that are related to those matters, the Full Bench decision expressly stated that the CFMMEU be permitted to make submissions at the rehearing of the application in relation to matters raised by its grounds of appeal, which went beyond the matters in its 16 November 2017 submission to Commissioner Riordan.

CPB submission on whether the CFMMEU’s submissions should be considered, or given weight in the proceedings

[42] CPB submitted that the CFMMEU has no automatic right to be heard in respect of the application for approval of the Agreement and the FW Act does not provide for intervention in proceedings before the FWC by a non-party. However, the FW Act does provide at s 590 that the FWC may, except as provided by the FW Act, inform itself in relation to any matter before it in a manner as it considers appropriate, including by invitation, subject to any terms and conditions determined by the FWC, oral or written submissions.

[43] CPB submitted that it is not in dispute that the Full Bench directed pursuant to s607(3)(c)(ii) of the FW Act that the CFMMEU be permitted to make submissions at the rehearing of the application for approval of the Agreement in relation to the matters raised by its grounds of appeal. 13 CPB submitted however that the order by the Full Bench permitted the CFMMEU to make submissions in respect of the matters raised by it in its appeal, and does not, by way of right, give those submissions any weight or the same weight as submissions made by the applicant or any other party to the Agreement. CPB submitted that it is entirely open to the Commission to disregard the submissions and says that this is what should occur.

[44] CPB submitted that the right of an eligible union to be heard in relation to an application for approval of an agreement is settled by the Full Bench in CFMEU v Collinsville Coal Operations Limited 14 and approved in CFMEU v MGI Piling (NSW) Pty Ltd15 and depends upon the circumstances in each case. CPB submitted that the rights, interests or expectations of the CFMMEU in the application are similar to those discussed in CFMEU v Collinsville Coal. CPB submits that relevantly the approval of the Agreement would not:

(a) Take away or interfere with any of the CFMMEU’s rights if the Agreement is approved;

(b) Affect its ability to represent employees of CPB;

(c) Affect the rights of an employee covered by it to choose whether he or she wishes to join, cease or continue to be a member of the CFMMEU;

(d) Affect the right of the CFMMEU to be involved in bargaining for any successor or replacement agreement;

(e) Affect the right of an officer of the CFMMEU who is a permit holder under the FW Act to investigate suspected contraventions of the FW Act or the terms of the Agreement.

[45] CPB submitted that the CFMMEU does not have any members covered by the Agreement, it was not appointed as a bargaining agent during the negotiation process, and still does not have any members covered by the Agreement some 18 months after it was approved by the workers. As it was not a bargaining agent, CPB submitted the CFMMEU has no right under the FW Act to be covered by the Agreement.

[46] Whilst the FWC has the benefit of the submissions made by the CFMMEU, in the circumstances where its rights are not impacted by the Agreement, it cannot be covered by the Agreement and has no members covered by the Agreement, its submissions should be dismissed, or given little weight.

[47] In its reply submissions of 6 June 2019 the CFMMEU submitted that the Full Bench required that the Commission rehear the matter in accordance with its directions including that the CFMMEU be permitted to participate in the hearing by making submissions and their submissions raise substantial compliance arguments in respect of ss 180(5), 186(2)(c), 186(3) and satisfaction of s 188(1)(c). The CFMMEU further submitted it is erroneous and an invitation into error for CPB to assert that ‘no weight’ should be given to the CFFMEU submissions because it was not a bargaining representative.

[48] The CFMMEU submitted a failure to consider the substantial arguments would result in the FWC acting contrary to s 607(3)(c)(ii).

[49] The CFMMEU also submitted that it is erroneous to suggest that CFMEU v Collinsville Coal erects a decision-rule concerning the entitlement of unions to be heard on agreement approval applications and that Collinsville was specific to its facts. The CFMMEU submitted that in this case, unlike Collinsville, there is an extant enterprise agreement which covers and applies to the CFMMEU and confers specific rights on the CFMMEU. The CFMMEU submitted this also distinguishes the matter from CFMEU v MGI Piling (NSW) Pty Ltd. 16

[50] The CFMMEU submitted that the 2016 Agreement confers rights on the CFMMEU which will cease if the Proposed Agreement is approved:

(a) The right, under clause 3.3 to agree with other parties to the 2016 Agreement to ascribe rates of pay to certain classifications;

(b) The right, under clause 20.2 to be consulted about work on rostered days off adjacent to shut down weekends;

(c) The right to enter into discussions about top-up workers’ compensation insurance, sickness cover and 24-hour accident cover under clause 30;

(d) The right of union delegates, including of the CFMMEU, to be paid wages when required to attend court or industrial tribunals, or carry out legitimate union work whilst on site under clause 33.5;

(e) The right to be provided union training under clause 38.

[51] The CFMMEU submitted that given that approval of the proposed agreement would remove these rights and impact the CFMMEU interests adversely, procedural fairness requires the CFMMEU be heard on the approval of the Proposed Agreement. The CFMMEU was also a party who was heard on appeal and was successful on appeal and directed to be heard from on the rehearing and it thus has an entitlement to be heard.

[52] On 11 June 2019 CPB filed reply submissions to the CFMMEU submissions of 6 June. CPB submitted that it does not put that the FWC should ignore the CFMMEU submissions but that it should afford them nil weight.

[53] CPB emphasised that the CFMMEU had no members covered by the Proposed Agreement and was not nominated as a bargaining representative.

[54] On 21 June 2019 the CFMMEU sent email correspondence to my Chambers copying in the representative of CPB and the AWU drawing to my attention to a recent Fair Work Commission Full Bench decision in Construction, Forestry, Maritime, Mining and Energy Union v Mechanical Maintenance Solutions Pty Ltd[2019] FWCFB 3585 that it said had a significant bearing on this matter with respect to CPB’s submissions of 11 June 2019 regarding the CFMMEU’s role in the rehearing, noting paragraphs [35] to [41] of the decision.

[55] The recent Full Bench decision in CFMMEU v Mechanical Maintenance departs from the earlier FWC Full Bench decision decided before a decision of the Full Court of the Federal Court in Energy Australia Yallourn Pty Ltd v Automotive, Food, Metal, Engineering, Printing and Kindred Industries Union. 17

[56] The Full Bench decision in CFMMEU v Mechanical Maintenance adopts the approach of the decision in Energy Australia Yallourn where it was found the enterprise agreement conferred substantive rights on the Appellant in that matter. The Full Bench decision included the following:

“[35] Respectfully, we take a different view. We consider that a decision to approve an enterprise agreement which, when it commences operation, has the effect of removing the right of a registered organisation to enforce the terms of an antecedent enterprise agreement (although not for past contraventions) which covers it, directly affects that organisation. It has the effect of removing a workplace right. The view we hold is consistent with the observations of a Full Court of the Federal Court in Energy Australia Yallourn Pty Ltd v Automotive, Food, Metal, Engineering, Printing and Kindred Industries Union, which was decided after MGI Piling set out below;……”

[57] The Full Bench referred to the finding in Energy Australia which was to the effect that a union “covered” by an enterprise agreement pursuant to s 201(2) has a right under s 540(2) to seek a remedy under Div 2 of Part 4-1 of the Act, and has a workplace right under s 341(1)(a) because it has a role or responsibility under s 341(1)(b) and because it could initiate or participate in a dispute settlement process within the meaning of ss 341(2)(j) and 186(6).

[58] As was the case in CFMMEU v Mechanical Maintenance, in this matter the Leighton Contractors (NSW/ACT) Civil Projects CFMEU, AWU, AMWU Enterprise Agreement 2012 – 2016 conferred substantive rights on the CFMMEU including Grievance Procedures and Dispute Settlement at clause 34. In accordance with the Full Federal Court decision in Energy Australia the CFMMEU was a party to the 2016 Agreement with all of the rights of a party. 18

[59] It follows that the CFMMEU has substantive rights whilst the 2016 Agreement continues to operate and those rights would be directly affected upon the approval and commencement of operation of the Proposed Agreement. It is on that basis that I have determined it is appropriate to fully consider the CFMMEU’s submissions, and not to afford them little or no weight as the Applicant has argued.

[60] Having given consideration to all of the submissions received from the parties I determined that further evidence related to the arguments specifically related to s.180(5) and s 188(c) may assist in determining the matter. On 7 August 2019 email correspondence was sent to the parties requesting that the Applicant provide further evidence if it was able to including:

(a) Any further evidence concerning the content of the explanation provided to employees concerning the changes between the 2016 Agreement and the Proposed Agreement and the effect of those changes;

(b) Any further evidence concerning the content of the explanation provided to employees concerning the coverage and application of the Agreement and the effect of those changes;

(c) Any further evidence concerning the content of the explanation provided to employees in regard to the CFMMEU and AWU becoming parties to the Agreement;

(d) A copy of the document referred to at 6.4 of CPB’s submissions of 31 May 2019 that identified the differences between the 2016 Agreement and the Proposed Agreement.

[61] On 16 August 2019 the Applicant filed additional statements from Mr Adam Carpenter, Mr Grant Marini and Mr David Chapman. The matter was listed for hearing on 10 September 2019. On 26 August 2019 the CFMMEU sent email correspondence to the Commission advising that it did not require the Applicant’s witnesses for cross examination. All parties subsequently advised the Commission that they consented to the matter being determined on the material now before the Commission without the need for a further hearing.

[62] It is reasonable in the circumstances to proceed to determine the matter on the basis that what is said in the further statements filed by the Applicant on 16 August is not contested.

Section 180(5) - explanation of the terms and effect of the terms of the Proposed Agreement

[63] The CFMMEU submitted that the duty imposed on an employer under s 180(5) is not merely to take reasonable steps; it is a duty to take all reasonable steps. The intensifying adjective 'all' is significant in the statutory phrase and must be given work to do. All means "the whole of... the whole number of... the greatest possible". The adjective 'reasonable' means 'logical and rational' but not 'excessive'. The ordinary meaning of the phrase 'all reasonable steps' is therefore every step it would have been logical or rational for an employer to take in the circumstances. 19

[64] The CFMMEU submitted that s180(5) requires the Commission to identify the content of the explanation of the terms of an agreement and the effect of those terms that was provided to employees by the employer, and the particular circumstances and needs of the employees. 20 A failure to inquire into these matters will result in a failure to properly exercise the jurisdiction reposed in the Commission by s 186. The CFMMEU submission was that (at least prior to 16 August 2019) a dearth of evidence about the content of the explanation of the terms and effect of the terms of the Agreement given to employees, or the substance of such communications.21 To discharge its statutory function under s 180(5), the Commission must know what employees had been told before they cast their votes. In the absence of such evidence, the Commission cannot be satisfied that CPB met its obligations under s 180(5).22

[65] CPB submitted that satisfaction regarding compliance with s180(5) of the Act is an evaluative judgement which needs to be established only by satisfaction of the decision maker and such a judgement needs to occur having regard to the circumstances of the employees approving the agreement. CPB submitted that the validity of an agreement should not be open to collateral attack on the basis that the objective existence of the facts required by s 180(5) cannot be established in reference to the decision in One Key. 23

[66] CPB referred to the decision of Deputy President Gostencnik in BGC Contracting Pty Ltd 24 in support of its submission that s180(5) is concerned with the taking of all reasonable steps, and that the required steps will vary according to the circumstances. CPB further submitted inaccuracies or errors in a form also cannot be assessed in some vacuum and do not necessarily impact on compliance with s 180(5) and any explanation cannot be read in isolation and needs to be read in conjunction with other material provided to employees.

[67] The CFMMEU submitted that the following matters illustrate the Commission cannot be satisfied that the Applicant took all reasonable steps to explain the terms and effect of the terms of the Agreement. The CFMMEU submitted that:

Differences between the 2016 Agreement and the Proposed Agreement

[68] Employees were, at the time they voted for the Agreement, covered by the Leighton Contractors (NSWACT) Civil Projects CFMEU, AWU, AMWU Enterprise Agreement 2012-2016 (2016 Agreement). The CFMMEU submitted that there are a number of differences between the 2016 Agreement and the Proposed Agreement, many of which were detrimental to employees; and/or had the potential to impact employees either directly or indirectly. The CFMMEU submission (made prior to the filing of further statements on 16 August 2019) was that there is no evidence that any of these differences were identified by CPB to the voting cohort or their terms and effect explained.

[69] The CFMMEU submitted that the Proposed Agreement contains a number of terms which are “legally ineffective” 25 and none of these were noted or explained to employees.

[70] Further it is put that employees were provided erroneous information about the ability of trade unions who were not bargaining representatives for the Proposed Agreement to become 'parties' to it, by the expedient of signing it after it had been 'made' for the purposes of s182 of the Act.

[71] There is a real question as to whether CPB explained, or was capable of explaining, the terms and effect of the Proposed Agreement's coverage clause.

[72] The unchallenged statement of Mr Carpenter included that he had considerable experience in enterprise bargaining having worked in industrial relations for 24 years. He said the only employees who would be covered by the Proposed Agreement were 7 employees based either on or near the Tuggerah to Doyalson Project (T2D) and Wyong Depot, and 5 employees based on the North Coast of NSW near Coffs Harbour at Corindi Plant Yard and Cooks Lane Depot who were to later commence working on the upcoming Woolgoolga to Balina Project (W2B).

[73] Mr Carpenter said he was aware that all of the relevant employees had been covered by the 2016 Agreement and had been employed for some years under its terms. He said all of the employees were permanent, in most cases with five or more years’ experience and the Applicant did not employ casuals.

[74] Mr Carpenter said after the expiry of the 2016 Agreement the Building Code 2016 (the Code) had been enacted which meant that a new enterprise agreement that complied with the Code needed to be approved.

[75] Mr Carpenter described in his statement first meetings occurring on 12 September 2017 at the T2D Project site office for one and half hours. Mr Carpenter said he explained they would have several further meetings, and the process he would follow including reviewing the 2016 Agreement as the basis of the drafting of the Proposed Agreement, highlighting changes and new clauses and explaining their effect, seeking agreement on the draft before discussing changes to wages and allowances, and explaining in person to all employees the changes, the effect on them and application.

[76] Mr Carpenter said he explained on 12 September that a phone text voting service would be used. He said he provided employees with a copy of the 2016 Agreement for their reference as well as other current enterprise agreements for a number of competitors. Mr Carpenter said he also explained that any enterprise agreement would need to be approved by the ABCC as compliant with the Code. He explained that the 2016 Agreement was not compliant with the Code, and the types of clauses which were not Code compliant. Mr Carpenter said he also issued each employee an ABCC information sheet about the Code for their reference.

[77] Mr Carpenter said that the employees asked some questions and as he understood it, they had been employees of the Applicant for some time and were reasonably familiar with the concepts he was explaining and the terms of the 2016 Agreement.

[78] Mr Carpenters evidence was that he discussed and encouraged involving a union as a bargaining representative and the employees said words to the effect “that won’t be necessary but we can contact a union at any time right”, and Mr Carpenter said he replied “yes”.

[79] Mr Carpenter said he was aware that there was no union delegate at T2D nor a history of union involvement.

[80] Mr Carpenter said he had a similar meeting at the Plant Yard at Berkeley Vale where again he said the two employees at that meeting seemed to be very familiar with the terms of the 2016 Agreement. He said he again discussed and encouraged involving a union as a bargaining representative and said employees said words to the effect of “we never seen them and we get on fine here.”

[81] Mr Carpenter said on 21 September he travelled to Coffs Harbour to visit the employees at the other two sites and said the employees at both sites appeared to be comfortable with the process and knowledgeable about the 2016 Agreement and the process to be followed. He said he discussed and encouraged involving a union as a bargaining representative and employees said words to the effect of “don’t think so but we think about it.” Mr Carpenter said he was aware that there was no union delegate at either Coffs Harbour site or a history of union involvement.

[82] Mr Carpenter said none of the employees at any of the sites indicated that they wanted to speak with any union or have any union involvement. He said he told all employees that he thought it would be appropriate to invite the AWU and CFMMEU to be a party to any new Agreement given many projects the Applicant works on have one or more unions involved.

[83] Mr Carpenter described a second round of meetings including 5 October 2017 at the T2D Project where he said he handed out a copy of a draft of the Proposed Agreement he had prepared and in that document he had highlighted in yellow some of the key items that he wanted to negotiate with employees. He said he again explained how ABCC approval would be required by the Code, and based on previous ABCC Agreement assessments had replaced non code compliant clauses with “model clauses” that were compliant.

[84] Mr Carpenter said that he had separate copies of the model flexibility term and consultation terms as inserted, which he made available to those who wanted a copy. He said the meeting went for approximately two hours. He said he commenced the meeting with a page by page clause by clause comparison between the 2016 Agreement and the Proposed Agreement that he had drafted. He said to assist he highlighted in yellow the areas of changed conditions and this took quite a long time, and he explained the reasons behind each of the changes the Applicant wanted to make.

[85] Mr Carpenter said not all of the drafting changes were highlighted which was why he went through the document clause by clause and he only highlighted the changes which were changes in key conditions to assist.

[86] Mr Carpenter said the employees did ask a lot of questions relating mainly to monetary items including travel allowance, inclement weather provisions, working through lunch provisions, proposed wage increases which were not yet included, LAHFA and the productivity allowance.

[87] Mr Carpenter said the coverage and scope of the Proposed Agreement was the same as the 2016 Agreement. He said as there were no changes to the coverage this was not a matter which was the subject of lengthy discussion. He said he recalled he explained coverage as follows using the words to the effect of “the coverage of this new agreement will be the same as the current agreement. As with the current agreement, it will cover new employees on project agreements if a greenfields agreement is put in place.”

[88] Mr Carpenter’s statement said that he had a meeting with the employees at Corindi for approximately an hour and twenty minutes on 11 October 2017 and his evidence about how the meeting proceeded was similar to his evidence concerning the 5 October meeting. He also said he had a meeting with the employees at Cooks Lane on 12 October 2017 and it was similar to the meetings at Wyong and Corindi.

[89] Mr Carpenter also included in his statement description of a third round of meetings on 19 October at Wyong for one hours and fifteen minutes and 26 October at Coffs Harbour with employees at Cooks Lane and Corindi for one hour. At these meetings a further draft Proposed Agreement was circulated reflecting some changes since the second meetings including wages and allowances, a separate table of wages and allowances changes that had been inserted into the Proposed Agreement, a clean version of the Proposed Agreement labelled “without prejudice” and a copy of an SMS voting guide as provided by the service provider.

[90] His statement included some detail concerning these meetings, his belief that employees were genuine in their expressions of approval to him about the Proposed Agreement and that he was satisfied after the third round of meetings that the employees were content with the Proposed Agreement and understood the terms of the Proposed Agreement.

[91] Mr Carpenter said he therefore arranged for the access period and vote to occur. He said that as no relevant employee had involved any union, immediately after making an application to the Commission for approval he considered it appropriate to notify both the AWU and the CFMMEU that the Agreement had been made and to invite them to seek to be bound. He said he did so as he considered that in the future both unions may have a member employed under the terms of the new Agreement and in the interests of harmonious industrial relations given the operations of the Applicant.

[92] Mr Marini, a Leading Hand on the Tuggerah to Doyalson Motorway Project provided a statement confirming many of the facts contained in the statement of Mr Carpenter concerning meetings held, including questions being asked and a clause by clause comparison between the 2016 Agreement and the Proposed Agreement taking place. He said that at the end of the last meeting he was content with the contents of the Proposed Agreement, understood the changes and was not aware of any other employee raising other issues, and he understood through his discussions and observations that employees were content with the Proposed Agreement.

[93] Mr Chapman, a Leading Hand on the Woolgoolga to Ballina Motorway Project said he had been employed by the Applicant for 11.5 years. He also confirmed many of the facts contained in the statement of Mr Carpenter concerning meetings held, including questions being asked and a clause by clause comparison between the 2016 Agreement and the Proposed Agreement taking place.

[94] He said that at the end of the last meeting he was content with the contents of the Proposed Agreement and understood the changes.

[95] The CFMMEU provided extensive written submissions regarding differences between the 2016 Agreement and the Proposed Agreement on matters and at the time of filing the written submissions maintained that these changes had not been identified or explained including the following:

• Clause 11 – Individual flexibility clause

• Clause 13 – daily fares and travel allowance

• Clause 14.4 – first aid allowance

• Clause 14.6 – distance work

• Clause 20.2 – rostered days off

• Clause 32 – consultation

• Clause 33 – employee representation

• Clause 33.5 – facilities

• Clause 34 – grievance and dispute settlement procedures

• Clause 40 – Supplementary labour

[96] On the basis of the unchallenged statements of Mr Carpenter, Mr Marini, and Mr Chapman, I am satisfied concerning the requirements of s 180(5) as they pertain to these clauses.

Clause 35 – occupational health and safety

[97] The CFMMEU submitted that clause 35 of the Proposed Agreement provides that any dispute about safety that is unable to be resolved will be referred to a ‘Workcover Inspector’ who will arbitrate on the procedures required for rectification and a ‘Workcover Inspector’s’ decision is said to be binding.

[98] The CFMMEU submitted that since 2015 there has been no organisation known as ‘Workcover’ in New South Wales, however there is an organisation known as ‘Safework NSW’ which is the regulator established under the Work Health and Safety Act 2011 (NSW) (WHS Act).

[99] The CFMMEU submitted that presuming that ‘WorkCover Inspector’ is intended to refer to an inspector appointed under the WHS Act, the inspectors appointed pursuant to s.160 do not have, as one of their statutory functions, the arbitration of safety disputes, but rather their functions are limited to assisting in the resolution of work health and safety issues at workplaces.

[100] Further the CFMMEU submitted that inspectors are conferred with specific powers and none of these powers permit an inspector to arbitrate a safety dispute, and therefore clause 35 operates on a false premise. The CFMMEU submitted how this clause and its operation were explained to employees is unclear and given its nonsensical nature, and the erroneous predicate on which it is based, it is difficult to envisage how it could have been explained if some attempt was made to explain it.

[101] The CFMMEU submitted that the clause cannot have the effect that it intended to have. That may or may not be so, however given the clause is identical to the clause in the 2016 Agreement and given all the circumstances of the matter including the further statements filed by CPB the facts concerning this issue do not lead me to conclude that the CPB failed to take all reasonable steps to ensure that the terms of the clause and the effect of the term was explained and that is sufficient for the purposes of s 180(5).

Clause 41 – No extra claims under the Proposed Agreement

[102] The CFMMEU submitted that this clause purports to prevent ‘Unions’ (which are defined by clause 4 to be the unions that have signed the Proposed Agreement) and employees or their representatives from making any claims against CPB for increases in pay rates or allowances, or about any other matters during the life of the Proposed Agreement.

[103] The CFMMEU submitted that this clause is invalid on account of inconsistency with the Act, referred to the decision in Toyota Motor Corporation Australia Limited v Marmara, 26and submitted this was neither identified or explained to employees.

[104] In Toyota v Marmara it was held that a no extra claims clause cannot be used to preclude an attempt to vary the agreement itself. I am not satisfied on the basis of the CFMMEU submission that even if it were the case that the Applicant did not bring to the attention of employees that they retained an ability under subdivision A in Division 7 of Part 2-4 of the Act to reach an agreement with the Applicant to vary the Proposed Agreement, that therefore resulted in the Applicant failing to take all reasonable steps to ensure the terms of the Proposed Agreement and that the effect of those terms were explained.

Unions as ‘parties’ to the Proposed Agreement

[105] The CFMMEU submits that clause 3.2 of the Proposed Agreement provided that the agreement was between CPB, the employees and ‘the unions who had signed the Agreement’.

[106] The CFMMEU submitted that this was misleading for the following reasons:

(a) Unions cannot be party principals to enterprise agreements;

(b) As there were no union bargaining representatives for the Proposed Agreement, no union was able to be covered by the Proposed Agreement and have it apply to it. The CFMMEU relies upon the Form F16 and F17 filed by CPB on 17 November 2017 and CPB’s submissions of 13 March 2018 at [3](iv) to support its submission that there were no union bargaining representatives for the Proposed Agreement. On that basis the CFMMEU submit that no union was able to be covered by the Proposed Agreement and have it apply to it.

(c) The mechanism of the union signing an enterprise agreement which it was not a bargaining representative for was an act of no legal consequence under the FW Act.

[107] The CFMMEU submitted that CPB appears to have thought, and appears to have encouraged its employees to think, that the AWU and CFMMEU could become parties to the Proposed Agreement by signing it once it was made and submits that this was reflected in CPB’s 13 March 2018 submissions to Commissioner Riordan as follows:

“CPB is making the Agreement discussed with employees and had the agreement of employees that the CFMMEU and AWU if not nominated by any employee to be a bargaining representative, could be given the opportunity to be a party. CPB wrote to the CFMEU inviting them to be a party to the Agreement…….

A union can be a party to an Agreement, despite not being a bargaining representative…”

[108] The CFMMEU submitted that the CPB submissions of 13 March 2018 to Commissioner Riordan erroneously asserted that CFMEU v Collinsville Coal Operations Pty Limited[2014] FWCFB 7940 supports this proposition.

[109] The CFMMEU submitted that employees were thus provided a misleading picture about the capacity of unions to be parties to the Proposed Agreement and CPB was incapable of explaining the true position to employees given it was operating under a fundamental misconception about the ability of unions to be covered by enterprise agreements under the FW Act.

[110] The CFMMEU has submitted that unions cannot be a party principal to enterprise agreements. However the recent Full Federal Court decision in Energy Australia foundthat where employees vote to approve an enterprise agreement that makes provision for a union to have a role as a party, and the Commission notes a union is covered by an enterprise agreement, the union is a party in its own right to the agreement, with all the rights of a party. 27

[111] I agree with the CFMMEU submission to the extent that the mere act of a union signing an enterprise agreement cannot make a union a party to the enterprise agreement, or create an entitlement to be covered in accordance with s 201(2). To the extent that CPB may have held a different view or expressed a different view it was wrong. However I disagree with the CFMMEU submission in other respects. The fact that CPB’s Form F16 and F17, and CPB’s written submission in March 2018 claimed that there were no employee bargaining representatives does not necessarily make it so. Section 176(1)(b) states as follows:

“(1) (a) ………………

(b) an employee organisation is a bargaining representative of an employee who will be covered by the agreement if:

(i) the employee is a member of the organisation; and

(ii) in the case where the agreement is a multi-enterprise agreement in relation to which a low paid authorisation is in operation – the organisation applied for the authorisation;

unless the employee has appointed another person under paragraph (c) as his or her bargaining representative for the agreement under subsection 178A(2);

(c) a person is a bargaining representative of an employee who will be covered by the agreement if the employee appoints, in writing, the person as his or her bargaining representative for the agreement;

(d) ……………..”

[112] The CFMMEU has conceded it did not have membership amongst the employees to be covered and on that basis it is correct in its case that it cannot be a bargaining representative and could not seek to be covered. However the AWU made no such concession, and to the contrary filed a Form F18 stating it was a bargaining representative because one or more of its members are employees who are covered by the Proposed Agreement and the AWU was entitled to represent the industrial interests in accordance with s176(1)(b).

[113] Having membership at the relevant time is sufficient for the purposes of the Act to be a bargaining representative and for the AWU to be covered by the Proposed Agreement. Further as I have understood the CFMMEU submissions it has not asserted that the CFMMEU had made explicit to CPB during bargaining that it did not have any members.

[114] CPB’s submission to Commissioner Riordan indicating that employees were told if not nominated by any employee to be a bargaining representative, (unions) could be given the opportunity to be a party, if correct, is a statement concerning an eventuality that may or may not be capable of being given effect depending on the facts, particularly in the light of the decision in Energy Australia.

[115] Employees are not required to disclose or publicly nominate a union as their bargaining representative. CPB had no way of knowing with certainty whether any of its employees were members of a union or not whilst bargaining was occurring.

[116] The CFMMEU submission is that CPB by indicating to employees unions could sign the agreement and become parties to the Proposed Agreement, it was misleading employees into believing something which was not correct. Given the words at clause 3.2 of the Proposed Agreement it is possible that an employee may have formed a view that no employee need be a member of a union and unions could still be a party to the Proposed Agreement. However the unchallenged statements support the conclusion that CPB was in fact positively encouraging union involvement in the bargaining process from the first meetings in September 2017 and this did not result in any union engagement in the process. This is consistent with the three statements that indicated employees for whatever reason, did not indicate an intention to invite union involvement in the bargaining.

[117] Having considered the material as it pertains to this issue and in all of the circumstances of this case, this issue does not lead me to conclude that CPB failed to take all reasonable steps to ensure that the terms of the agreement and the effect of those terms were explained.

Coverage and application of the Proposed Agreement

[118] The CFMMEU submitted that the second paragraph of clause 3.3, read with the third paragraph of that clause provides, amongst other things, that the ‘Parties’ (defined by clause 4 to be the unions who signed the Proposed Agreement, CPB and the employees) agreed to add construction related classifications to the Proposed Agreement at any time to permit coverage of construction related work not foreseen at the time the Proposed Agreement was made, and the parties were to reasonably agree to ascribe a rate of pay to these classifications.

[119] The CFMMEU submitted that it is rudimentary that an enterprise agreement cannot be varied other than by the procedure prescribed by Division 7 of Part 2-4 of the FW Act. The CFMMEU submitted that the second paragraph of clause 3.3 of the Proposed Agreement purported to provide a means by which the Proposed Agreement could be varied. The CFMMEU submitted that for reasons described by the Full Court of the Federal Court in Teys Australia Beenleigh Pty Ltd v Australasian Meat Industry Employees’ Union (2016) 264 IR 161 at [18] and ]19] any such purported variation would be efficacious.

[120] The CFMMEU submitted that this was neither identified nor explained to employees and employees would have been of the view that the second paragraph of clause 3.3 was legally effective.

[121] The CFMMEU also submitted that the correct construction of the fourth paragraph of clause 3.3 was dealt with by the Full Court of the Federal Court in CPB v CFMMEU where O’Callaghan and Wheelahan JJ pointed out that clause 3.3 did not have the effect that the making of a site-specific enterprise agreement (whether greenfields or non-greenfields) would cause the Proposed Agreement to cease to cover and apply to the employees, and the Proposed Agreement would cease to cover and apply to employees depending on an actual change in the particular employment of an employee and the terms of any greenfields or non-greenfields site agreement.

[122] The CFMMEU submitted that it was imperative for CPB to have identified the terms of the Proposed Agreement that were legally inefficacious and to properly explain how the last paragraph of clause 3.3 operated and CPB’s failure to take these steps entails that it failed to comply with its obligations under s 180(5). On that basis the CFMMEU says the Commission cannot be satisfied that CPB took all reasonable steps to explain the terms and effect of the terms of the Proposed Agreement.

[123] CPB submitted that it provided an undertaking to the FWC dated on 24 April 2018 that the second paragraph of clause 3.3 should have no effect. It submitted that there is therefore no basis on which the parties can agree to add construction related classifications to the Agreement at any time.

[124] CPB submitted that clause 3.3 does not therefore contain any means by which the Agreement could be varied. CPB submitted that at the time the Agreement was put to vote it was CPB’s understanding that there was no concern with the legal efficacy of paragraph 2 of clause 3.3. CPB says this question was only raised by the CFMMEU in its appeal of Commissioner Riordan’s decision which has now been proved to be incorrect.

[125] CPB submitted that there is nothing in the Form F17 to support the assertions made by the CFMMEU that changes were not identified nor explained to employees, nor any evidence to support that assertion. CPB says this was further detailed in the Initial CPB Submissions which were filed by Mr Carpenter, the IR Manager for CPB at the time and the deponent of the Form F17.

[126] CPB submitted that it was in the above context that the parties, discussing among themselves, agreed on inviting a number of unions to be covered by the Agreement. The fact that as a matter of law, the CFMMEU was unable to be covered does not translate into some misleading conduct which impacts on the genuineness of the agreement by the employees. The employees had the option of having the CFMMEU as a bargaining representative and did not wish to, and it can hardly be said that any statement about whether or not the CFMMEU could be covered by the Agreement, whether correct or not, was a matter that impacted on the genuineness of the agreement by the employees.

[127] CPB submitted that to suggest that there is an obligation on the employer, when taking all reasonable steps, to identify potential legal challenges to the Agreement, and explain the potential legal challenge as well as the impact is ridiculous. CPB say the obligation on the employer is to take all reasonable steps to explain the terms of the Agreement and it does not extend to identifying or explaining potential legal challenges to the Agreement.

[128] CPB submitted that the correct construction of the final paragraph clause 3.3 was confirmed by the Full Court of the Federal Court that clause 3.3 did not automatically result in an employee ceasing to be covered by the Agreement, and any change in coverage would be as a consequence of a change in the particular employment of the employee, so that coverage of the Agreement might cease. CPB says that it is clear that discussions about coverage of the Agreement were held and there was no failure on the part of CPB to comply with its obligations under s180(5), in respect to coverage of the Agreement.

[129] The CFMMEU responded in its submission of 6 June submitting the CPB submissions of 31 May fail to grapple with the requirement in One Key that it is fundamental to the achievement of satisfaction under s 180(5), and a prerequisite to the proper exercise of jurisdiction under s 186(2) that the Commission know the content of what was told to employees referring to the decision in One Key.

[130] The coverage clause as between the 2016 Agreement and the Proposed Agreement was identical. I am satisfied having regard to the unchallenged statements that clause 3.3 and specifically the second and fourth paragraphs of clause 3.3 and their effect were explained.

[131] At the heart of the CFMMEU submission with regard to the second paragraph is the proposition that the undertaking regarding the second paragraph of clause 3.3 does not retrospectively address the matter of what employees were told at the time and what they understood about how the agreement operated.

[132] I accept CPB’s submission that at the time the Agreement was put to vote it was CPBs understanding that there was no concern with the legal efficacy of paragraph 2 of clause 3.3. I am satisfied from the material neither CPB nor its employees would have foreseen the legal challenge that resulted in the undertaking offered by CPB, accepted by Commissioner Riordan, and found by the Full Bench to have been capable of acceptance by the Commission as an undertaking in accordance with s 190 of the Act. The same language in paragraph 2 was contained in the 2016 Agreement which had been approved by the Commission.

[133] The legal issue identified and resolved by the undertaking does not undermine a conclusion that based on the material before the Commission CPB took all reasonable steps to ensure that the terms of the agreement, and the effect of those terms was explained. The failure of CPB to identify the issue does not in all of the circumstances result in a failure to satisfy s 180(5).

The correct construction of the fourth paragraph of clause 3.3 was confirmed by the Full Court of the Federal Court and the material before the Commission confirms there was no failure on the part of CPB to take all reasonable steps to ensure the fourth paragraph of clause 3.3 and its effect was explained.

Other Submissions on s 180(5) and s 188(c)

[134] CPB submitted as to s188(c) that the section is not concerned with the genuineness of the employer or its motives; rather it is concerned with the genuineness of the agreement by the employees in reference to Collinsville Coal 28 and this can be assessed in the context of the negotiations.

[135] CPB submitted that in this case the employees covered by the Agreement had been working under the Former Agreement; were not new to the industry; and had been directly involved in negotiating the Agreement. Further, the employees had been invited to have a bargaining representative but chose not to do so. CPB submitted it also had a number of meetings to discuss the Agreement with its employees. CPB submitted the Agreement itself is based on the Former Agreement and is not significantly changed.

[136] CPB submitted that s 188(c) is expressed in the negative, and the CFMMEU has not provided any evidence or basis to establish that there is a s 188(c) reasonable ground or that the applicant did not comply with s.180(5).

[137] CPB submitted that at best the FWC has been presented with submissions made by a party who was not involved in the bargaining, is not aware of the bargaining process or approval process followed by CPB and in the absence of any evidence the contention of the CFMMEU relating to compliance with ss.180(5) and 188(c) should be rejected.

[138] CPB also submitted that there was no failure to disclose relevant information and in any event the Proposed Agreement passed the BOOT.

[139] CPB submitted that the CFMMEU’s submission that the Agreement should not be approved because of the differences between the Agreement and the Former Agreement is misconceived. CPB submitted that any comparison of the Agreement with instruments other than the applicable modern award is flawed. So much was recognised by the Full Bench in Collinsville Coal at [98].

[140] The CFMMEU responded to this submission by CPB in its submission of 6 June by stating the proposition is flawed, and the relevant comparison and explanation where an enterprise agreement covers and applies to employees and is to be replaced with a new agreement is with the extant agreement not the underlying Award. The CFMMEU relied on the decision of Deputy President Gostencnik in BGC Contracting Pty Ltd [2018] FWC 1466 at [87] – [88].

[141] In response to the CPB assertion that Collinsville supports the proposition that the relevant comparison for the purposes of s 180(5) is with the underlying award, the CFMMEU also submitted that paragraph [98] of the decision in Collinsville is concerned with BOOT and said nothing about s 180(5).

[142] In its response on 11 June 2019 CPB submitted its reference at 6.10 of its 31 May submission was to s 186(2)(d). It repeated its earlier submission that the CFMMEU had not filed any evidence to establish that CPB had not complied with s 180(5) and this remains the case.

[143] CPB sought to distinguish the facts of this case from the facts in One Key as in One Key only a bare statement that an explanation had been given had occurred, whereas in this case the Form F17 provided details as set out in the 11 June submission, and further evidence of the substance of the genuine agreement is obtained from the Initial CPB submission. This submission was reinforced by the subsequent statements filed.

[144] I accept that the paragraph in the decision in Collinsville referred to in the CPB submissions does not support the proposition that comparison between an extant agreement and a proposed agreement is flawed for the purposes of consideration of s 180(5). I also accept that it is correct that explanation involving comparison between the extant agreement and the proposed agreement is relevant to considerations under 180(5).

[145] On 20 June 2019 the CFMMEU sent email correspondence to my Chambers copying CPB’s representatives and the AWU drawing my attention to a Fair Work Commission Full Bench decision made on 14 June 2019 in Construction, Forestry, Maritime, Mining and Energy Union v Ditchfield Mining Services Pty Limited drawing specific attention to paragraphs [79] and [80] of that decision which read as follows:

“[79] As should be evident from the terms of s.180(5) of the Act, the content of the explanation required is twofold. First, there must be an explanation of the terms of the Agreement. Secondly, the effect of those terms must be explained.

[80] Having regard to the information that we have earlier reproduced about the explanation given to the relevant employees, we are not persuaded that there was any information based on which the Deputy President could have concluded to the requisite level of satisfaction that the Respondent explained the effect of the terms of the Agreement to relevant employees. This is because there is no information that discloses the content of that explanation (as to the effect of the terms), or that such an explanation was given.”

[146] The CFMMEU submissions as they would relate to the recent authority in Ditchfield were to a large extent overtaken by the filing of the three unchallenged statements after submissions were made.

[147] The CFMMEU submitted that section 188(1)(c) focusses on the authenticity and moral authority of an enterprise agreement 29 and that mere consent is insufficient and consent of a higher quality is needed.30

The CFMMEU submitted that a critical issue under s188(1)(c) is whether the agreement of the voting cohort of employees is capable of being described as having authenticity or moral authority based upon a real and true understanding of the consequences of the proposed agreement in reference to the Full Federal Court decision in CFMEU v AIRC (1999) 93 FCR 317 at [126] – [127].

[148] The CFMMEU submitted that matters relevant to the formation of the opinion required by s 188(1)(c) are informed by its context and purpose, read in the light of the act as a whole, including the scheme of collective bargaining the Act effects, and relied on the decision in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 163 CLR 24 at 39-40.

[149] The CFMMEU submitted the following matters for the purposes of the present matter as bearing on the genuineness of employees’ agreement under s 188(1)(c).

(a) The provision of misleading or false information by the employer about the proposed agreement;

(b) The explanation of the terms and effect of the terms of the agreement to employees which the CFMMEU submitted is a mandatory consideration under s 188(1)(c) in accordance with the One Key decision; 31

(c) The likelihood employees understood how their wages and working conditions would change (for better or worse) under the agreement; 32

(d) Matters that point to the agreement having been made by akin to individual bargaining; rather than via a process of collective bargaining, or alternatively expressed, does the manner in which the agreement was made subvert or undermine the FW Act’s preference for collective bargaining, relying on the decision in One Key; 33

(e) Whether the employees who voted for the Agreement could genuinely speak for the classes and categories of employees who will, in the future, be covered by the agreement if approved relying on the decision in One Key; 34

(f) Whether employees have a stake in the agreement’s pay rates and other provisions relying on a Full Bench decision of the FWC in KCL Industries Pty Ltd. 35

[150] The CFMMEU submitted that the time when an agreement is made and whether the workforce has been employed at the time the agreement is made is relevant in determining the question posed by s 188(1)(c), and relies on One Key to highlight the FW Act’s predisposition for collective over individual bargaining, and where the collective of employees is yet to be formed the Act’s preference for collective bargaining is apt to be subverted or undermined. 36

[151] The CFMMEU submitted that in the present matter employees were provided erroneous information about the ability of unions to be parties to the Proposed Agreement and that it appears from the submissions made by CPB to Commissioner Riordan that this was a material matter which bore on whether employees determined to appoint or, as it eventuated, not appoint, union bargaining representatives. The CFMMEU argued this is a factor pointing to the bargaining process miscarrying to a significant extent and constitutes a reasonable ground for believing that the Proposed Agreement was not genuinely agreed.

[152] The CFMMEU also submitted that for the reasons discussed above CPB’s explanation of the terms and effect of the terms of the Proposed Agreement where those terms differed from the 2016 Agreement so far as those terms were ineffective in law was manifestly deficient and therefore employees could not have had a true understanding of the impact of the Proposed Agreement. The CFMMEU says this is a further matter founding a reasonable ground for believing the Proposed Agreement was not genuinely agreed, as employees were not able to accurately know or apprehend how their terms and conditions of employment would change if the Proposed Agreement was made and approved.

[153] The CFMMEU also submitted that the Proposed Agreement was made at a time CPB had a small workforce and anticipated employing more. Mr Dean Reilly provided a statement dated 24 May 2019 concerning what he understood was the extent of work employees of CPB were performing in civil construction in New South Wales at that time. 37

[154] The CFMMEU submitted that this occurred no doubt by design by CPB before the collective of employees who would work for CPB throughout New South Wales were employed and the bargaining which happened had the hallmarks of individual bargaining and therefore constitutes a reasonable ground for believing that the Proposed Agreement was not genuinely agreed.

[155] Further, the CFMMEU submitted that the Proposed Agreement covers a raft of classifications which encompass a substantial number of occupations and roles in the civil construction industry, and there is no evidence about the experience and background of the 7 employees from Wyong and Coffs Harbour who voted on the Proposed Agreement and whether they could speak for the occupations and classifications under the Proposed Agreement.

[156] CPB submitted that there is no evidence that the negotiation process was akin to individual bargaining rather than a process of collective bargaining and that 12 employees were involved in the negotiation over a process of 7 meetings.

[157] CPB submitted that there is no evidence to support the assertion or inference that there was an inherent power imbalance in the relationship during negotiation with the 12 employees employed at the time. CPB submitted that the FW Act provides for employees to be assisted in the bargaining process through the appointment of a bargaining representative. CPB says that the relevant employees had that option and did not appoint a bargaining representative.

[158] CPB submitted that the fact that the Agreement was voted up by 10 employees is not a determinative factor when determining the genuineness of the agreement by the relevant employees. It submitted that other than providing the option for a greenfields agreement, the FW Act does not require that an enterprise be a particular size, or have a minimum number of employees before an agreement is put to employees for approval, and made reference to the Full Court of the Federal Court decision in CFMEU v John Holland Pty Ltd and Fair Work Commission 38 to submit that there is no legal impediment for the agreement to be approved by 10 employees.

[159] CPB submitted that there is no evidence that the employees have acted in self interest in approving the Agreement, or that there has been unfair exploitation.

[160] CPB submitted that employees who approved the Agreement had a stake in the Agreement’s rates and other provisions, and the Agreement is based on the Former Agreement which applied to the relevant employees, does not cover other industries that the Applicant does not currently work in, nor replace a broad range of awards. CPB says the Agreement applies to employees employed in the relevant classifications within NSW on the Applicant’s civil engineering projects and related works other than in relation to tunnelling excavation.

[161] The submissions of the CFMMEU and CPB were made prior to the filing of the additional statements.

[162] Given the unchallenged statements I am not concerned on the facts of this case that the bargaining had the hallmarks of individual bargaining.

[163] The further statements also put to rest any potential concern that the agreement might not have been genuinely agreed on the basis of the submissions made by CPB to Commissioner Riordan concerning unions becoming parties to the Proposed Agreement. It was clear CPB was positively encouraging union participation in bargaining and being covered by the Proposed Agreement.

[164] On the basis of the further statements I can be satisfied that CPB took all reasonable steps to ensure the terms of the agreement, and the effect of those terms was explained, and further that none of the grounds that have been raised by the CFMMEU provide a basis not to be satisfied in relation to s 188(c).

Section 186(3) – fairly chosen

[165] The CFMMEU submitted that s 186(3) is designed to protect the process of collective bargaining and referred to the Full Court of the Federal Court decision in Aerocare Flight Services Pty Ltd v Transport Workers’ Union of Australia where the Full Court described the section’s primary purpose as being to ensure that the group of employees asked to approve an agreement is able to participate as an appropriate collective of employees in the collective bargaining process, so that it does not miscarry. 39

[166] It is submitted in reference to the Full Court of the Federal Court decision in CFMEU v John Holland 40that whether the group of employees was fairly chosen for the purposes of s 186(3) requires the Commission to bring to bear both the business rationale for the employer’s choice of an agreement’s coverage and, if a suggestion of this kind is made, the possibility of unfair exploitation and/or manipulation in the agreement making process.

[167] The CFMMEU submitted that in the present matter, the second paragraph of clause 3.3 purported to permit the Parties to the Proposed Agreement to add additional classifications to it, which were to have rates reasonably ascribed to them, and this clause is legally inefficacious. It is argued this has consequences for whether the Commission can be satisfied that the group of employees was fairly chosen in the following respects:

(a) The scope of the Proposed Agreement and selection of employees covered by it was not premised on an objective and rational basis, given that it was amorphous and liable to be altered and the geographic, occupational and operational scope was presumed by CPB to be malleable and capable of alteration;

(b) The scope of the Proposed Agreement was not based on rational grounds given the second paragraph of clause 3.3 was unenforceable and legally ineffective.

[168] The CFMMEU submitted for these reasons the Commission cannot be satisfied that the group of employees covered by the Proposed Agreement was fairly chosen.

[169] The CFMMEU unsuccessfully appealed Commissioner Riordan’s acceptance of the undertaking from CPB that the second paragraph of clause 3.3 would have no effect, on the basis that the undertaking impermissibly reduced the scope of the Proposed Agreement. The Full Bench refused permission to appeal in relation to that ground of appeal for the following reasons;

“(2) Ground 3: We consider that the first undertaking operated to remove an ambiguous and confusing element of the coverage provision in clause 3 of the Agreement rather than to narrow the scope of the coverage as it would reasonably be understood by those who voted for it. This is consistent with paragraph [34] of Main People. The ground of appeal does not have sufficient merit to justify the grant of permission, and in any case undertakings will have to be considered afresh at the rehearing we intend to order.”

[170] I do not accept the CFMMEU’s submission that the coverage of the agreement was not premised on an objective and rational basis because of the second paragraph of clause 3.3. The Proposed Agreement through the first paragraph in clause 3.3 covered all the classifications referred to in Appendix “A” in New South Wales on CPB civil engineering projects and related works other than tunnelling work.

[171] As was found by the Full Bench, the removal of the second paragraph resolved ambiguous and confusing language, but it did not narrow the scope of the Agreement as it would reasonably be understood. The language in the second paragraph appeared to have been an attempt to account for unknown future potential developments. The undertaking that the second paragraph have no effect was appropriate but the inclusion of the words in the Proposed Agreement does not lead to a result that the group of employees covered by the Proposed Agreement was not fairly chosen.

National Employment Standards

[172] The CFMMEU submitted that the Commission is required by s 186(2)(c) to be satisfied that the terms of an enterprise agreement do not contravene s 55 of the FW Act and referred to the test enunciated by the Full Bench of the FWC in Application by Canavan Building Pty Ltd 41.

[173] CPB submitted that if the FWC has concerns that particular clauses of the Agreement exclude provisions of the NES, this does not preclude the Agreement from being approved and referred to section 190.

[174] CPB submitted that it had already provided an undertaking with respect to clause 9 of the Agreement, and is prepared to provide undertakings in respect of the additional matters raised.

[175] CPB submitted that clause 6 of the Agreement expressly incorporates the NES to the extent that there are more beneficial entitlements under the NES as compared to the Agreement and therefore, if there is any question as to the provision of the Agreement, it would be subservient to the NES and it is clear that the Agreement does not operate to exclude the NES.

[176] The CFMMEU rejected the CPB submission that clause 6 is a panacea to CPB’s issues in relation to s 186(2)(c) and referred to observations made by Vice President Hatcher in the course of the appeal hearing at transcript PN 290 – 296 where the Vice President indicated he did not accept CPB’s interpretation of clause 6.

Clause 11 Abandonment of employment

[177] The CFMMEU submitted that for the reasons described by the Full Bench of the FWC at paragraphs 29 to 32 in CFMMEU v CPB, the abandonment of employment provision under clause 9 of the Proposed Agreement operates to exclude the benefits and rights afforded to employees by s 117 of the FW Act.

[178] CPB has offered an undertaking as follows:

“Clause 9 (Abandonment of employment) will not be applied contrary to section 55 of the Fair Work Act 2009 (Cth). That is, where termination of employment occurs in circumstances which might not constitute serious misconduct (as defined in reg 1.01(2)(a) of the Fair Work Regulations 2009 (Cth)) it will not exclude the notice of termination provisions in sections 117(2) and (3) of the Fair Work Act 2009 (Cth)).

[179] I am satisfied that the proposed undertaking in relation to clause 9 resolves this concern.

Clause 26.10 Notice and evidence requirements for personal leave

[180] The CFMMEU submitted that clause 26.10 of the FW Act allows an employer to request an employee to provide evidence that the employee was taking personal leave that would be sufficient to satisfy a reasonable person. Submissions referred to the ‘reasonable person’ standard as an important protection against unfettered managerial prerogative to accept or reject an employee’s evidence about their reasons for absence and relied on the decision in CFMEU v Endeavour Coal Pty Ltd. 42

[181] It is submitted that clause 26.10 contra distinctly to s 107(3) provides that it is exclusively a matter for CPB as to whether it accepts the sufficiency of the employee’s evidence about their taking personal leave and this removes the reasonable person test from the Agreement, and therefore operates to determine that an employee will not receive, in full, the benefit of s 107(3) and this is impermissible.

[182] CPB submitted that whilst it did not agree with the submissions made, it will agree to provide an undertaking to the effect that any evidence required to be provided under clause 26.10 will be as required by s 107(3) of the FW Act.

[183] I am satisfied that the undertaking that CPB has offered would resolve the issue and request that it be provided.

Clause 28.1 Jury service

[184] The CFMMEU submitted that s 108 of the FW Act confers a right on an employee who engages in an eligible community service activity to be absent from their employment for a period correlating with the time the employee engages in the relevant activity. In the case of jury service s 108 envisages that an employee is able to be absent from work for the entire period the employee is on jury service.

[185] The CFMMEU submitted that clause 28.1 of the Proposed Agreement permits an employee to be absent from work for jury duty only for a period reasonable in all the circumstances and this imposes a fetter on the right conferred by s 108 and inverts the exception created for jury duty under s 108(b) and is an impermissible exclusion. The CFMMEU submitted this provision also has the potential to impinge on and undercut make up pay whilst an employee is undertaking jury service as conferred by s 111.

[186] CPB rejected the CFMMEU’s submission. CPB submitted that s 108(b) the FW Act provides that where an employee is absent on jury service, that an employee may be absent from their employment for a period if the employee’s absence is reasonable in all of the circumstances. It submits that the FW Act does not envisage that an employee is able to be absent from work on jury leave for the entire period of the jury service. Furthermore, section 111 of the FW Act limits payment to an employee on jury leave to the first 10 days of the absence. CPB submitted clause 28.1 of the Agreement does not impinge or undercut any right imposed by the NES.

[187] The CFMMEU responded in its submission of 6 June 2019 that the CPB construction of s 108(b) was wrong and an employee is entitled to be absent on jury service whilst they are on jury service, and jury service is specifically carved out. The CFMMEU submitted that the employee’s entitlement to payment for 10 days under s 111(5) is irrelevant to the entitlement to be absent for the entirety of the period of jury service.

[188] I prefer the CFMMEU’s interpretation of s 108 that the exception in s 108(b) is intended to have the effect that the “reasonable in all of the circumstances” requirement does not apply in the case of jury service. The entitlement to be absent, and the requirement for payment for the period of absence by the employer, are separate requirements that do not necessarily correlate. The obligation for payment is limited to 10 days whereas the entitlement to leave does not have this limitation. On that basis I request that CPB provide an appropriate undertaking to address this concern.

Clause 28.2 emergency management bodies

[189] The CFMMEU submitted that s 109(3) defines a recognised emergency management body relevantly to include a body or part of a body with a substantial purpose involving one or other of the matters described in s 109(3)(c). It is submitted clause 28.2(c) limits ‘emergency management body’ to, relevantly, bodies that have as a substantial purpose securing the safety of persons or animals and does not encompass ‘parts of bodies’ that have the requisite substantial purpose and this is impermissible.

[190] I request that CPB provide an undertaking that clause 28.2(c) will be read and interpreted such that a recognised emergency management body includes a recognised emergency body described in s 109(3)(c) of the FW Act.

Clause 28.4 evidentiary requirements for community service leave

[191] The CFMMEU submitted s 110(3)(a) provides an employee is required to provide, on request, evidence to their employer concerning their participation in a community service activity that is of a quality that would satisfy a reasonable person, however clause 28.4(c) under the Proposed Agreement requires employees to provide CPB proof that their absence is due to their engagement in an eligible community service activity, placing a higher bar on employees than required under s 110(3)(a) and points it being a matter for CPB to determine whether the proof is reasonable and is impermissible.

[192] CPB submitted that s 110 of the FW Act imposes obligations on an employee seeking to be absent from the workplace on account of Community Service Leave to give the employer, as soon as practicable, notice of the absence as well as the period or expected period of the absence. CPB submitted that clause 28.2 imposes no additional obligation or bar on an employee than imposed by the FW Act. A reasonable person would expect that evidence provided clearly showed that the absence was due to an eligible community service activity. Despite this submission CPB is prepared to provide an undertaking that any evidence required will accord with the provisions of s 110(3) of the Act.

[193] I am satisfied that the undertaking that CPB has offered would resolve the issue and request that it be provided.

• Concerning Casual Employment, Part Time Employment and Redundancy

[194] The submissions of the CFMMEU of 24 May and 6 June 2019 made no reference to three undertakings that were the subject of grounds of appeal to the Full Bench and for which permission to appeal was refused on the basis that the undertakings will have to be considered afresh at the rehearing and there was no utility in the Full Bench addressing these matters on appeal. CPB has also made no submission to me about these matters.

[195] I am still required to consider whether the undertakings can be accepted. I note on 28 August the representative of CPB has forwarded previous undertakings offered to my Chambers. The criticism of the undertaking on appeal in regard to casual employment was that the undertaking was ambiguous and contradictory, as well as aspirational. The Commissioner accepted the following undertaking;

“To mitigate any question, dispute or difficulty in relation to casual employees engaged under the Agreement, the award clause 14 Casual employment shall be applied, subject (sic) the Agreement prevailing in the event of inconsistency. Further CPB expressly commits to:

d. Casuals be engaged for a minimum of 4 hours

e. Casuals be advised prior to commencement of the anticipated duration of their employment and

f. Casuals have the same right to convert to permanent employment after six months continuous service, as provided by the award clause 14.8”

[196] Clause 7 of the Agreement provides that employees may be engaged on a casual basis and also provides an entitlement to 25% casual loading and entitlement to relevant penalty rates under the Agreement. It is otherwise silent on casual entitlements in the Award. The undertaking provides for further entitlements not provided under the Agreement. The undertaking is sufficiently clear that I am prepared to accept it in the form as previously provided subject to correction of typographical error.

[197] A similar criticism was made of the undertaking in relation to clause 13 that it was ambiguous and contradictory. The Commissioner accepted the following undertaking;

[198] I am prepared to accept the undertaking for the same reasons subject to correction of typographical error.

[199] The undertaking in regard to clause 17 was criticised on the basis that it was not capable of meeting any concern about the clause not complying with ss 186(2)(c)-(d). The Commissioner accepted the following undertaking;

“Clause 17 Redundancy does not undermine any rights or entitlements as prescribed by the Fair Work Act 2009 or National Employment Standards.”

[200] Given the other more generous conditions in the Agreement I am not concerned that the Agreement is at risk of failing the better off overall test on the basis of clause 17. Given the undertaking if accepted will form part of the Agreement it appears that it is intended to achieve a result whereby in the event clause 17 is less beneficial in any respect then the NES the NES will apply, however to the extent the language could be interpreted differently, and to put the matter beyond doubt I request that CPB provide an undertaking in regard to clause 17 in the following terms:

“Clause 17 (Redundancy) will not be applied contrary to section 55 of the Fair Work Act 2009 (Cth). That is, where the entitlement in clause 17 is less beneficial then redundancy entitlements under the NES the NES entitlement will apply.”

Conclusion

[201] Undertakings have also previously been offered in regard to the second paragraph of clause 3.3 and clause 9. For the reasons set out above I foreshadow it is my view at this stage that the Agreement can be approved on the basis of the undertakings concerning paragraph 2 of clause 3.3 and clause 9 and the other undertakings offered and/or requested as set out above subject to the requirements of s 190(4).

[202] For administrative convenience it would be of assistance if CPB were to collate and submit to the Commission all of the undertakings in a single document.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

1 CFMMEU v CPB Contractors Pty Ltd[2018] FWCFB 5773

2 CPB Contractors Pty Ltd v CFMMEU [2019] FCAFC 70

3 CPB Contractors Pty Ltd [2018] FWC 2580

4 CFMMEU v CPB Contractors Pty Ltd[2018] FWCFB 5773

5 CFMMEU v CPB Contractors Pty Ltd[2018] FWCFB 5773 at [17]

6 CFMMEU v CPB Contractors Pty Ltd[2018] FWCFB 5773 at [19]

7 CPB Contractors Pty Ltd v CFMMEU [2019] FCAFC 70 at [7]

8 CFMMEU v CPB Contractors Pty Ltd[2018] FWCFB 5773 at [27]

9 Construction, Forestry, Mining and Energy Union v One Key Workforce Pty Ltd [2017] FCA 1266

10 Construction, Forestry, Maritime, Mining and Energy Union v Ditchfield Mining Services Pty Limited [2019] FWCFB 4022

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

12 [2014] FWCFB 7940

13 Order 5, CFMMEU v CPB Contractors Limited [2018] FWCFB 5773

14 (2014) 246 IR 21

15 [2016] FWCFB 2654

16 [2016] FWCFB 2654

17 [2018] FCAFB 146, (2018) 28 IR 318

18 Energy Australia Yallourn Pty Ltd v Automotive, Food, Metal, Engineering, Printing and Kindred Industries Union [2018] FCAFB 146, (2018) 28 IR 318 at [76]

19 Construction, Forestry, Mining and Energy Union v Sparta Mining Services Pty Ltd (2017) 264 IR 390 at [15]

20 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 at [113]-[116]; Construction, Forestry, Mining and Energy Union v Dawsons Maintenance Contractors Pty Ltd[2018] FWCFB 2992 at [41]-[42]

21 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 at [111].

22 Ibid, at [116] – [117]

23 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 at [103]-[106].

24 [2018]FWC 1466 at [87] – [89], [158]

25 CFMMEU submissions, p. 10

26 (2014) 244 IR 335

27 Energy Australia Yallourn Pty Ltd v Automotive, Food, Metal, Engineering, Printing and Kindred Industries Union [2018] FCAFB 146, (2018) 28 IR 318 at [76] –[77]

28 (2014) 246 IR 21 at [97]

29 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 at [143]

30 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 at [141]

31 Ibid

32 Ibid

33 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 at [153]

34 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 at [155] – [157]

35 KCL Industries Pty Ltd [2016] FWCFB 3048 at [36]-[37]

36 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 at [151]

37 Statement of Dean Reilly dated 24 May 2019

38 [2015] FCAFC 16, Buchanan J at [16]

39 [2018] FCAFC at [19] – [20]

40 (2015) 228 FCR 297 at [33]

41 [2014] FWCFB 3202 at [36]

42 [2013] FCCA 703 at [149] – [151]