Australian Nursing and Midwifery Federation v Armest Pty Ltd T/A Miles Witt Partnership
[2020] FWCFB 2045
•21 APRIL 2020
| [2020] FWCFB 2045 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
Australian Nursing and Midwifery Federation
v
Armest Pty Ltd T/A Miles Witt Partnership; Australian Workers' Union, The; The Good Shepherd Limited as Trustee for the Good Shepherd Nursing Homes Charitable Trust
(C2020/257)
VICE PRESIDENT HATCHER | SYDNEY, 21 APRIL 2020 |
Appeal against decision [[2019] FWCA 8733] of Deputy President Asbury at Brisbane on 24 December 2019 in matter number AG2019/3910.
Introduction
[1] The Australian Nursing and Midwifery Federation (ANMF) has lodged an appeal, for which permission is required, against a decision of Deputy President Asbury issued on 24 December 2019 1 (decision). The decision concerned an application by Armest Pty Ltd T/A Miles Witt Partnership (Armest) for the approval of the The Good Shepherd Home Enterprise Agreement 2019 (Agreement). The Deputy President approved the Agreement with undertakings. The ANMF and the Australian Workers’ Union (AWU) are covered by the Agreement.
[2] An appeal under s 604 of the Act is an appeal by way of rehearing and the Commission’s powers on appeal are exercisable only if there is error on the part of the primary decision maker. There is no right to appeal and an appeal may be made only with the permission of the Commission. Subsection 604(2) requires the Commission to grant permission to appeal if satisfied that it is “in the public interest to do so”. Permission may otherwise be granted on discretionary grounds.
[3] The appeal was listed to be heard on 25 March 2020. However, in light of the COVID-19 pandemic and the closure of the Commission’s premises the parties agreed, and we considered it appropriate, that the appeal would be decided on the basis of the written submissions without holding a hearing pursuant to s 607(1) of the Fair Work Act 2009 (FW Act). The AWU advised that it did not intend to make submissions.
Grounds of appeal
[4] In its notice of appeal lodged on 14 January 2020, the ANMF set out its grounds in support of its contention that the Commissioner erred in approving the Agreement as follows:
1. The learned Deputy President erred by failing to give reasons or adequate reasons … for the actual or implied rejection of the Appellant’s objections in opposition to approval of the Agreement.
2. The learned Deputy President erred by failing to accord the appellant procedural fairness by failing to grant the appellant an opportunity to be heard at all or adequately concerning the appellant’s objections set out in its Form F18 including by not giving the appellant an opportunity for an oral hearing.
3. The learned Deputy President erred by failing to take into account a relevant consideration in determining the better off overall test (BOOT) under s 186(2)(d) of the Fair Work Act by failing to take into account the matters raised by the appellant in section 5 of its Form F18 setting out the reasons that the agreement did not pass the BOOT.
4. The learned Deputy President erred by failing to consider or adequately consider whether the requirements of the BOOT had been satisfied.
5. The Deputy President erred by failing to:
5.1. consider or adequately consider whether the undertakings given satisfied the BOOT or were sufficient to satisfy the BOOT by remedying the disadvantage under the Agreement;
5.2. give reasons for finding that the BOOT had been satisfied;
5.3. otherwise give reasons for being satisfied of the matters in paragraph [4] of the Reasons.
6. The Deputy President erred by failing to seek the views of each bargaining representative about the undertakings offered by the Respondents, contrary to s 190(4) of the Fair Work Act.
7. The Deputy President erred by failing to perform the functions and exercise the powers in relation to approval of the agreement in a manner that was fair, just, open and transparent as required by s 577 of the Fair Work Act, in particular by reason of the matters at grounds 1 to 3 above.
8. The Deputy President erred in being satisfied that the requirements of s 188 of the Fair Work Act had been met in the absence of evidence of the number of the 89 casual employees who were employed in the access period and the number employed after the access period and who voted in circumstances where the margin in favour was 22.
Background
[5] The Good Shepherd Limited (Good Shepherd) is the employing entity at a residential aged care facility located in Townsville, Queensland. It issued a Notice of Representational Rights (NERR) to its employees on 16 April 2019, and bargaining for an enterprise agreement then commenced. Good Shepherd appointed Armest as the employer bargaining representative. The ANMF and the AWU were bargaining representatives for employees. There were no other employee bargaining representatives.
[6] The Agreement was made on 30 September 2019 by a vote of 130 employees, of whom 76 voted in favour of the Agreement. 362 employees were covered by the Agreement of whom 269 were part-time and 89 were casual employees.
[7] The application for approval of the Agreement was made on 11 October 2019 by Armest and was accompanied by a Form F17 declaration made by Mr Steve Stacey, the Chief Executive Officer of Good Shepherd. The application advised that the ANMF and the AWU were bargaining representatives for employees for the Agreement. On the same day the AWU lodged a Form F18 in which it advised that it supported approval of the Agreement and gave notice pursuant to s 183 of the FW Act that wanted the Agreement to cover it.
[8] On 16 October 2019 the ANMF was sent a letter by the Commission concerning the procedure which would be taken with respect to the application for approval of the Agreement. Among other things, the letter stated:
“Within 7 business days of when the application was lodged, any person wishing to be heard in this matter, or intending to lodge a statutory declaration (e.g. F18, F18A or F21), must contact the Fair Work Commission.
In the absence of any person indicating they wish to be heard, the application for approval of the agreement may be determined in accordance with the requirements of the Act on the basis of the materials lodged with the Fair Work Commission. In all circumstances, the presiding Member will determine whether a matter is listed for an attendance hearing.”
[9] In response to this correspondence, the ANMF sent an email to the Commission which simply stated: “We intend to lodge an F18 statutory declaration”. It did not indicate that it wished to be heard in relation to the application.
[10] On 22 October 2019 the application was referred to the Deputy President. On 26 November 2019 the Deputy President’s chambers corresponded by email with Armest setting out a number of matters that “may require consideration by the Deputy President”. This email was copied to the ANMF and the AWU. The matters of concern identified in the email were, in summary:
• the response from Mr Lucas to questions 2.7 and 2.8 in the Form F17 declaration which accompanied the application for approval of the Agreement, and further information was sought about information sessions for employees and how the terms of the agreement and its effects were explained to employees;
• the definitions of shift workers in the Agreement, with the observation being made that those definitions appeared to place additional requirements on shift workers than those contained in the Awards;
• how the Commission could be satisfied that Trainees were better off overall when under the Agreement their wage was set in accordance with the National Training Wage Schedule; and
• how the Commission could be satisfied that part-time employees working overtime were better off overall when the Agreement provided that overtime was payable for hours in excess of the rostered daily ordinary full-time hours compared to hours in excess of agreed hours in the Aged Care Award 2010.
[11] On 29 November 2019 the ANMF lodged a Form F18 declaration in which it declared that it did not support the approval of the Agreement, and contended that the Agreement did not pass the Better Off Overall Test (BOOT) as required by s 186(2)(d). The declaration incorporated what was in effect a submission detailing, in 19 paragraphs, the basis upon which it was contended that the Agreement did not pass the BOOT. In summary, the ANMF contended that the Agreement contained the following detriments compared to the relevant award, the Nurses Award 2010 (Award), which outweighed any more beneficial terms (noting that some of the matters identified appear to be more relevant to the approval requirement in s 186(2)(c) than (d)):
• the Agreement provides for fixed-term employment whereas the Award does not;
• part-time employees are, under the Agreement, required to be available across all shifts, whereas under the Award part-time employees have fixed hours and a fixed roster agreed at the outset of their employment;
• the Agreement provides that the casual loading does not compound on penalty rates, whereas it does under the Award in respect of weekend, public holiday and overtime penalty rates;
• the Agreement disentitles employees from being paid at the pay point which reflects their experience if they do not provide evidence of their previous experience within four weeks of commencing employment;
• the Agreement provides that ordinary hours may be averaged over an unspecified period, meaning there is no effective maximum limit on ordinary hours;
• the Award provides that weekend penalty rates are calculated on the employee’s ordinary wage inclusive of allowances and loadings, whereas the Agreement provides that they are calculated on the base rate only;
• the Agreement does not contain the requirement in the Award that meal breaks must be taken between the fourth and sixth hour after beginning work where reasonably practicable;
• employees who are regularly rostered over seven days of the week (and who therefore also regularly work on weekends), but who do not work a combination of day, afternoon and night shifts over more than 2 roster periods, are entitled to one week less of annual leave under the Agreement than under the Award;
• the Agreement requires that four weeks’ notice of the taking of annual leave be given by the employee except where otherwise agreed, but the Award does not contain this requirement;
• the Agreement does not require part-time employees to be paid for all ordinary hours not worked on a public holiday, contrary to the NES;
• the Agreement contains requirements for the provision of a medical certificate or a statutory declaration in certain circumstances in order to access personal leave entitlements which are inconsistent with the NES requirement for the provision of “evidence that would satisfy a reasonable person of an illness or injury etc”;
• the Agreement requires attendance at training at hours outside the employee’s rostered ordinary hours, with a threat of disciplinary action in cases of non-attendance;
• under the Agreement, there is an implied term that an employee with less than six months’ service is liable for the cost of Police checks;
• employees may be required to attend wing meetings and meetings of all nurses outside of their rostered ordinary hours; and
• trainees may be employed in accordance with the National Training Wage Schedule, and are therefore not better off in their wage rate overall than under the Award, which does not contain a National Training Wage Schedule.
[12] The ANMF’s Form F18 declaration stated that the ANMF did not wish to advise the Commission about whether it agreed with any of the statements in Good Shepherd’s Form F17 statutory declaration.
[13] On 2 December 2019 Good Shepherd provided a response to the email of 26 November 2019 from the Deputy President’s chambers and, in doing so, offered undertakings in respect of some of the concerns raised. This response was copied to the ANMF and the AWU. The undertakings offered were to the effect that:
• the Agreement’s wage increases would be paid to Trainees employed under Agreement clause 51 on top of the wage rates applicable under the National Training Wage Schedule at any time during the life of the Agreement; and
• the classification position for which rates of pay are listed in Schedule A for Environmental Services Level 1.1 would have no effect and that the rates of pay for Level 1.2 would be the minimum applicable to Environmental Services employees at Level 1.
[14] In the period which followed the receipt of this communication until the publication of the decision on 24 December 2019, there was:
• no communication from the Commission seeking the views of any bargaining representative in relation to the proposed undertakings; and
• no response to the communication by the ANMF nor any request to be heard further in relation to the application for approval of the Agreement.
The decision and subsequent events
[15] The Deputy President’s decision was comprised of five paragraphs in which she addressed in short form the essentials for the application, noted that the ANMF and the AWU were covered by the Agreement, accepted the undertakings set out above, expressed her satisfaction that each of the requirements of ss 186, 187, 188 and 190 of the FW Act as relevant were met, and approved the Agreement. There was no reference to the BOOT issues raised by the ANMF in the decision.
[16] On 7 January 2020, the ANMF, having learnt of the decision, wrote to the Deputy President’s chambers indicating its “surprise” at the decision and its lack of reference to the ANMF’s objections, and stated:
“…We wonder if our objections may have been inadvertently overlooked.
We ask that the Commission advise us in that regard and then we may wish to make a suggestion about what should be done.”
[17] On 9 January 2020 the Associate to the Deputy President responded on her behalf and stated, in summary, that the Deputy President had considered the ANMF’s Form F18 declaration, that the ANMF had not sought to be heard in relation to its objections nor did it choose to indicate any disagreement with the matters contained in Good Shepherd’s Form F17 declaration, and that the Deputy President had considered that the matters raised in the Form F18 were either addressed by the undertakings or were not matters which would cause her not to approve the Agreement.
The ANMF’s case on appeal
[18] The ANMF submitted that:
• the Deputy President failed in the decision to acknowledge the objections of the ANMF and failed to engage with the reasons put forward by the ANMF as to why the Agreement did not pass the BOOT;
• the decision failed to give reasons as to why the ANMF objections were rejected and this alone justified the appeal being upheld;
• as a bargaining representative, the ANMF should have been given the opportunity to be heard in relation to its objections, and the failure to afford it this opportunity constituted a denial of procedural fairness;
• it was denied an opportunity to have an effect on the outcome of the application for approval of the Agreement;
• the only rational conclusion from the train of events is that its BOOT objections were not considered and were ignored;
• its views were not sought on the undertakings offered by Good Shepherd as required by s 193(4) of the FW Act;
• the Commission could not be satisfied that the Agreement was genuinely agreed for the purposes of s 188(1)(b) of the FW Act in circumstances where 76 employees voted in favour of the Agreement but 89 employees were casual employees and, in the absence of evidence of the status and number of casual employees the Commission could not determine the casual employees’ eligibility to vote or that employees engaged as casuals after the voting process commenced were not included in the ballot.
Good Shepherd’s submissions
[19] Good Shepherd relied upon the email from Deputy President’s chambers of 9 January 2020 as demonstrative of the proposition that the matters raised in the ANMF’s Form F18 had been considered by the Deputy President, but did not otherwise place in contest the ANMF’s grounds of appeal. It instead gave a detailed response to each of the 19 BOOT matters raised in the Form F18, noting that it had not previously been requested to do so. It submitted that the ANMF’s objections “…can be adequately addressed and even if upheld in whole or part, do not warrant the dismissal of the application for approval”.
Consideration
[20] In respect of grounds 2, 4 and 8 of appeal, we have decided to refuse permission to appeal. As to ground 2, we do not accept that the Deputy President denied the ANMF the opportunity to be heard. The Commission’s correspondence of 16 October 2019 directed the ANMF, if it wished to be heard, to contact the Commission and advise of this. The ANMF did not comply with this direction either within the identified timeframe or at all. The correspondence further warned the ANMF that in the absence of any party indicating that it wished to be heard, the application might be determined on the basis of the materials otherwise before the Commission. This is what in fact happened. In those circumstances, ground 2 is entirely lacking in merit.
[21] Ground 4 also lacks merit insofar as it is clear from the correspondence from the Deputy President’s chambers of 22 October 2019, which raised a number of BOOT-related concerns, and the decision in which the Deputy President accepted undertakings intended to address those concerns, that the Deputy President did consider the BOOT requirement for approval in s 186(2)(d). As to ground 8, no issue in relation to the voting process or s 188 was raised by the ANMF in its Form F18 declaration or otherwise at first instance, nor did the ANMF seek to contest the accuracy of the factual statements in Good Shepherd’s Form F17 declaration which were demonstrative of there being genuine agreement. It is not open to the ANMF to seek to run an entirely new case on appeal, and permission to appeal would not be granted for this purpose. Nor, in any event, does the material that was before the Deputy President provide any arguable basis for considering that there was error in her conclusion that the Agreement was genuinely agreed to as required by s 186(2)(a).
[22] However, other grounds of the appeal have substantial merit. Firstly, grounds 1 and 5 allege appealable error on the basis of a failure to provide any reasons as to the implicit rejection of the BOOT concerns raised by the ANMF. The relevant principles as to the need to give reasons were recently summarised by a Full Bench as follows:
“The FW Act does not in terms require that reasons be given for every decision made. Section 601(2) of the FW Act simply provides that the Commission “may give written reasons for any decision that it makes”. However an obligation to give reasons which address material issues of fact and law may arise as an incident of the fundamental requirement upon the Commission to act judicially and provide procedural fairness, and will certainly be implied in any case where the decision significantly affects the rights and interests of relevant persons, the matter is seriously contested and the appeal facility in s 604 is available.” 2
[23] In this case, where the ANMF had indicated in its Form F18 declaration that it opposed the approval of the Agreement and had provided a detailed exposition as to why it considered that the Agreement did not pass the BOOT, it was necessary for reasons to be given which at least acknowledged the ANMF objection and briefly identified the basis upon which that objection had been rejected. The absence of such reasons makes it impossible for us to exercise the appellate function of determining whether there was any appealable error in the Deputy President’s satisfaction that the Agreement passed the BOOT notwithstanding the matters raised by the ANMF. It cannot be assumed that the Deputy President regarded her acceptance of the undertakings as resolving the matters raised by the ANMF, since the undertakings were directed at the concerns which had been raised in the correspondence of 22 October 2019 by the Deputy President’s chambers. Although there was some overlap between those concerns and the matters raised by the ANMF, the Form F18 identified a much larger range of BOOT issues.
[24] Secondly, in relation to ground 6, it is clear that the views of the ANMF as a known bargaining representative were not sought in relation to the undertakings proposed by Good Shepherd. Section 190(4) prohibits the Commission from accepting undertakings unless the views of known bargaining representatives have been sought. Accordingly, the Deputy President had no power under the FW Act to accept the undertakings. We assume from the course of the proceedings and the decision that the Deputy President would not have approved the Agreement without the undertakings.
[25] For these reasons, we consider that permission to appeal should be granted in respect of grounds 1, 5 and 6, and that the appeal should be upheld on those grounds. In the circumstances, it is unnecessary for us to grant permission to appeal in order to consider grounds 3, or 7, which are concerned with matters consequential upon or related to grounds 1, 5 and 6. The appropriate course is to quash the decision and remit the matter to the Deputy President in order for the views of the ANMF (and the other bargaining representatives) in relation to the undertakings to be sought, and then for a further decision and reasons to be issued.
Orders
[26] We order as follows:
(1) Permission to appeal is granted with respect to grounds 1, 5 and 6 of the appeal. Permission to appeal is otherwise refused.
(2) Grounds 1, 5 and 6 of the appeal are upheld.
(3) The decision ([2019] FWCA 8733) is quashed.
(4) The application for approval of the Agreement (AG2019/3910) is remitted to Deputy President Asbury to deal with consistent with the above reasons for decision.
VICE PRESIDENT
Printed by authority of the Commonwealth Government Printer
<PR718410>
1 [2019] FWCA 8733
2 Re Hungry Jack’s National Enterprise Agreement 2019[2020] FWCFB 1693 at [41]
4