Balfours Bakery Pty Ltd

[2011] FWA 7397

[2011] FWA 7397

FAIR WORK AUSTRALIA

REASONS FOR DECISION

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

Balfours Bakery Pty Ltd
(AG2011/12890)

BALFOURS BAKERY PTY LTD AGREEMENT 2011

Food, beverages and tobacco manufacturing industry
COMMISSIONER HAMPTON	ADELAIDE, 10 NOVEMBER 2011

Application for approval of an enterprise agreement - ballot process - whether reasonable steps taken to advise employees of the ballot arrangements - whether requirements of Act met - whether ballot concerns relevant to assessment of genuine agreement - whether employees have genuinely agreed - application approved.

BACKGROUND

[1] This is an application by Balfours Bakery Pty Ltd (Balfours) pursuant to s.185 of the Fair Work Act 2009 (the Act) for the approval of the Balfours Bakery Pty Ltd Agreement 2011 (the Agreement).

[2] Having heard the application on 27 October 2011 and considered the additional evidence and submissions subsequently filed in the matter, on 7 November 2011 I approved the application 1 and advised that I would subsequently issue further reasons for that decision; which I now do.

[3] United Voice is a bargaining representative and is covered by the Agreement. The position of United Voice was that it neither supported nor opposed approval of the Agreement but it did seek to inform Fair Work Australia of the circumstances of some of its members.

[4] Without detailing all of the history of events leading to the application, the parties have been negotiating an agreement for some time and previous proposals have been subject to formal ballots in December 2010 and July 2011. Each was not approved by a valid majority of employees. There have also been a number of more recent informal consultations with the workforce regarding various options that have been included in the final instrument.

[5] Fair Work Australia has also conducted conferences with the parties, including more recently on site at the Dudley Park bakery operations of Balfours, pursuant to s.240 of the Act. In the course of those proceedings, I dealt directly with many members of the negotiating committee and their representatives and inspected the workplace.

[6] I also note that in the course of the approval proceedings, Fair Work Australia received correspondence from an employee raising a number of matters that were primarily policy issues, but in any event, did not indicate matters that suggested non-compliance with any of the statutory approval requirements. With the knowledge of the employee concerned, a copy of this letter, with personal details removed, was supplied to Balfours and United Voice prior to the making of their final written submissions. 2

[7] The ballot leading to the making of the agreement was conducted in October 2011 and out of a total of 113 employees, 95 valid votes were cast. Of those, 49 were valid votes in favour of approval of the instrument and this represents a majority, by a relatively small margin, of the total votes. There is no contention that the ballot count is anything but sound.

[8] The vote involved a secret ballot of employees attending on 6 October 2011 and a process whereby “absent” employees could lodge their vote by mail. There was also an additional more informal process whereby employees could lodge a vote prior to counting. The ballot was counted on 10 October 2011 by the enterprise agreement committee.

[9] Although not opposing approval of the Agreement, United Voice has advised Fair Work Australia that five of its members did not receive a ballot paper and has indicated that I should consider whether as a result, there was a genuine agreement within the meaning of the Act. In particular, it has raised the prospect that employees who were not able to vote on the day concerned may not have been aware that they could have voted up until the actual vote was counted some days later. Further, Ms Harrison for United Voice implied that I should consider whether the existence of even one employee who did not receive a ballot paper created uncertainty about the extent that this occurred more generally. United Voice also indicated that I should consider whether the information requirements of s.180 of the Act in relation to the ballot had been met. Evidence was provided by four members regarding their individual circumstances. 3

[10] Balfours contended that all of the statutory requirements had been met and the ballot result should be taken under the Act as being the genuine views of the relevant majority. Further, Balfours contended that the employees were advised and should have known that they could cast a ballot up until the point that the vote was counted and that it did not matter if for some reason, some individual employees now claimed not to have received a ballot paper at the time. Balfours provided a statutory declaration of its Human Resources Manager, Mr Duanne Banham, with the application, and supplementary evidence from two employees who undertook the administration of the letters and postal ballots. 4

[11] It is necessary that Balfours, as the applicant in this matter, satisfies Fair Work Australia that all of the relevant approval requirements of the Act have been met. Leaving aside for the moment the issues arising from the ballot, having considered all of the other statutory approval requirements I am satisfied that all have been met.

[12] This includes the process leading to putting the Agreement out to ballot, the nature of the employee group that is subject to the instrument, the better off overall requirements of s.193 of the Act, and the statutory form and content requirements. These matters were not contested by any of the parties and have been demonstrated to my satisfaction by the materials before the Tribunal.

[13] In that light, for the purposes of this decision I will deal only with issues associated with the ballot.

THE OPERATION OF THE STATUTORY PARAMETERS

[14] Without overlooking the objects or the broader context in which these provisions are to be applied, the following are of immediate import.

[15] The procedural steps leading to the employee approval process are predominately set out in s.180 and s.181 as follows:

“180 Employees must be given a copy of a proposed enterprise agreement etc.

Pre-approval requirements

(1) Before an employer requests under subsection 181(1) that employees approve a proposed enterprise agreement by voting for the agreement, the employer must comply with the requirements set out in this section.

Employees must be given copy of the agreement etc.

(2) The employer must take all reasonable steps to ensure that:

(a) during the access period for the agreement, the employees (the relevant employees) employed at the time who will be covered by the agreement are given a copy of the following materials:

(i) the written text of the agreement;

(ii) any other material incorporated by reference in the agreement; or

(b) the relevant employees have access, throughout the access period for the agreement, to a copy of those materials.

(3) The employer must take all reasonable steps to notify the relevant employees of the following by the start of the access period for the agreement:

(a) the time and place at which the vote will occur;

(b) the voting method that will be used.

(4) The access period for a proposed enterprise agreement is the 7-day period ending immediately before the start of the voting process referred to in subsection 181(1).

Terms of the agreement must be explained to employees etc.

(5) The employer must take all reasonable steps to ensure that:

(a) the terms of the agreement, and the effect of those terms, are explained to the relevant employees; and

(b) the explanation is provided in an appropriate manner taking into account the particular circumstances and needs of the relevant employees.

(6) Without limiting paragraph (5)(b), the following are examples of the kinds of employees whose circumstances and needs are to be taken into account for the purposes of complying with that paragraph:

(a) employees from culturally and linguistically diverse backgrounds;

(b) young employees;

(c) employees who did not have a bargaining representative for the agreement.

181 Employers may request employees to approve a proposed enterprise agreement

(1) An employer that will be covered by a proposed enterprise agreement may request the employees employed at the time who will be covered by the agreement to approve the agreement by voting for it.

(2) The request must not be made until at least 21 days after the day on which the last notice under subsection 173(1) (which deals with giving notice of employee representational rights) in relation to the agreement is given.

(3) Without limiting subsection (1), the employer may request that the employees vote by ballot or by an electronic method.”

[16] The importance of the vote by employees arises as a result of s.182 of the Act which confirms that such makes the agreement for present purposes. It does so for a single-enterprise (non-greenfields) agreement as follows:

“182 When an enterprise agreement is made

Single-enterprise agreement that is not a greenfields agreement

(1) If the employees of the employer, or each employer, that will be covered by a proposed single-enterprise agreement that is not a greenfields agreement have been asked to approve the agreement under subsection 181(1), the agreement is made when a majority of those employees who cast a valid vote approve the agreement.

...”

[17] Section 186 of the Act sets out the general approval requirements and these include those concerning the nature of the agreement as follows:

“186 When FWA must approve an enterprise agreement—general requirements

Basic rule

(1) If an application for the approval of an enterprise agreement is made under section 185, FWA must approve the agreement under this section if the requirements set out in this section and section 187 are met.

Note: FWA may approve an enterprise agreement under this section with undertakings (see section 190).

Requirements relating to the safety net etc.

(2) FWA must be satisfied that:

(a) if the agreement is not a greenfields agreement—the agreement has been genuinely agreed to by the employees covered by the agreement; and

(b) if the agreement is a multi-enterprise agreement:

(i) the agreement has been genuinely agreed to by each employer covered by the agreement; and

(ii) no person coerced, or threatened to coerce, any of the employers to make the agreement; and

(c) the terms of the agreement do not contravene section 55 (which deals with the interaction between the National Employment Standards and enterprise agreements etc.); and

(d) the agreement passes the better off overall test.

Note 1: For when an enterprise agreement has been genuinely agreed to by employees, see section 188.

Note 2: FWA may approve an enterprise agreement that does not pass the better off overall test if approval would not be contrary to the public interest (see section 189).

Note 3: The terms of an enterprise agreement may supplement the National Employment Standards (see paragraph 55(4)(b)).

...”

[18] The meaning of genuinely agreed is relevantly established in s.188 in the following terms:

“188 When employees have genuinely agreed to an enterprise agreement

An enterprise agreement has been genuinely agreed to by the employees covered by the agreement if FWA is satisfied that:

(a) the employer, or each of the employers, covered by the agreement complied with the following provisions in relation to the agreement:

(i) subsections 180(2), (3) and (5) (which deal with pre-approval steps);

(ii) subsection 181(2) (which requires that employees not be requested to approve an enterprise agreement until 21 days after the last notice of employee representational rights is given); and

(b) the agreement was made in accordance with whichever of subsection 182(1) or (2) applies (those subsections deal with the making of different kinds of enterprise agreements by employee vote); and

(c) there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees.”

[19] The ballot in this matter produced a valid agreement as contemplated by s.182 of the Act. That is, the relevant employees have been asked to approve the agreement under ss.181(1) of the Act and a majority of those employees who cast a valid vote approved the proposal.

[20] It is evident however that Fair Work Australia must approve an enterprise agreement if, and must not approve if it is not, satisfied that, amongst other matters, it has been genuinely agreed to by the employees covered by the agreement. This includes a consideration of the processes adopted by the employer when seeking the employees’ approval and the results of the ballot (or other method of endorsement). In applying the requirements of the Act in this regard I have been guided by the approach adopted by the Full Bench in McDonalds Australia Pty Ltd. 5

[21] The consideration as to whether there is genuine agreement also requires Fair Work Australia to contemplate whether there are other reasonable grounds for believing that the instrument was not genuinely agreed (s.188(c)). Although ultimately it has not been decisive in this case, I have adopted the view that this provides scope to consider the veracity of the ballot result, where warranted, for the following reasons.

[22] If all ballot results had to be accepted on face value, provided only that the procedural requirements leading to that point had been met, this could lead to perverse outcomes. The requirements of s.180 and s.181 require that reasonable steps be taken to advise the employees of certain matters and to provide access to the proposed agreement and other material. There is no express obligation that the ballot or other method of employee approval be conducted in a manner that provides the employees with a genuine opportunity to actually participate and express a view. 6 An extreme example might include where the notice is issued fully in accordance with s.180(3) but advises of a ballot process and timing where only a limited number of the relevant employees could in reality participate. In that light, unless s.188(c) of the Act is applied as I speculate above, the evident purpose of the employee approval obligations of the legislation may be undermined.7

[23] This approach would not however mean that there is an absolute obligation to demonstrate that each employee did actually have the same opportunity to vote. Rather, where the integrity and results of the ballot are seriously in doubt, Fair Work Australia may, pursuant to s.188 of the Act, examine those circumstances and consider whether there are other reasonable grounds for believing that the agreement has not been genuinely agreed by the employees.

[24] I would add that there is no suggestion in this case that the ballot arrangements were made in order to disenfranchise any employees and on the contrary, it is evident that they were conducted after consultation with the joint enterprise agreement committee with a view to permitting all relevant employees to participate.

THE EMPLOYEE APPROVAL PROCESS ADOPTED BY BALFOURS

[25] The ballot process adopted by Balfours was agreed in general terms by the enterprise agreement committee, which included delegates and officials of United Voice.

[26] A notice of employee representational rights as contemplated by s.173 of the Act had earlier been issued in accordance with the Act.

[27] The employees to be covered by the Agreement were advised on 26 and 27 September 2011 that a ballot was to be conducted on 6 October 2011. This was done through joint briefings conducted by management and United Voice and memos were placed on notice boards in the workplace. The employees were informed of the ballot process at these briefings.

[28] The memo also displayed in the workplace indicated as follows:

‘...

REMINDER...

All employees covered by the Balfours Bakery Pty Ltd Enterprise Agreement 2005 are informed that a ballot on the Balfours Bakery Pty Ltd Enterprise Agreement 2011 as presented and explained during the meetings with staff on Monday 26th and Tuesday 27th September 2011, will be held on:

VOTING TIMES

Thursday 06 October 2011

11:00am - 2:00pm

8:00pm - 9:00pm

LOCATION

Main Lunchroom

The voting process will be by way of a secret ballot to be held in the main lunchroom.

Eligible employees will be required to arrive during the above times to receive a ballot paper for voting on whether they support the Agreement as proposed, by voting “Yes” or “No” for rejecting the offer. Ballot papers are then to be deposited in the secured ballot box available in the lunchroom. Absentee votes will be posted to employees the week prior to the vote to allow sufficient time for the return of the papers.

Ballots will be counted on Monday 10 October 2011 in the presence of the Enterprise Agreement committee and results posted on the noticeboard.

Duanne Banham

HUMAN RESOURCES MANAGER”

[29] Access to the proposed agreement and the relevant modern award was provided throughout the statutory access period and the explanations of the agreement were thorough and appropriate to the circumstances of the employees.

[30] Any employees absent at the time of the briefings were sent a letter at their nominated home address on the same day and this advised as follows:

“...

RE: PROPOSED ENTERPRISE AGREEMENT AND BALLOT

As a result of the recent ballot on the preference by staff for income protection to be retained for the first three years of the proposed Agreement, a new Agreement has been written for consideration. Briefings are being held with employees on the new Agreement this week.

As you have been (or will be) absent during these briefings, I have enclosed a copy of the Agreement for your perusal and copy of the memo issued to employees covered by the Agreement.

The ballot for acceptance of the new Agreement will be conducted on Thursday 06 October 2011. If you will be absent on this day, a ballot paper will be sent to you separately.

Should you have any queries in regard to this matter, I encourage you to discuss this with your line manager, Bruce Brown, or myself.

Yours sincerely

Duanne Banham

HUMAN RESOURCES MANAGER

Acting for and behalf of Balfours Bakery Pty Ltd”

[31] On 5 October 2011, a further letter was sent to those employees who were not expected to be at work on 6 October 2011 and this referred to the impending ballot and the need to return the enclosed ballot paper by 10 October 2011. 8 This was sent to all such employees at their home addresses.

[32] Mr Brown, with the knowledge and support of at least one of the United Voice delegates also took measures on Monday 10 October 2011 to follow up employees that had not apparently voted.

[33] A secret ballot was conducted and the votes were counted during the course of 10 October 2011 only after the second mail drop of the day and following the actions of Mr Brown to provide further opportunities to vote. Leaving aside for the moment the capacity for all employees to participate, there is no suggestion that the form or conduct of the ballot itself was inappropriate or led to any undue pressure.

[34] In terms of those employees who have raised issues with Fair Work Australia, they fall into the following categories. One employee was not due to be absent on 6 October 2011 but was ill. He did not receive the ballot paper until Friday 7 October and despite attending for work on 10 October did not consider that he could lodge the ballot paper. This employee did not seek clarification or attempt to lodge a vote at any time.

[35] One employee did participate in the employee briefings but was on jury duty on the day of the ballot and expected to receive a ballot paper. This employee attended work on Saturday 8 October but in the absence of senior management on that day, indicated that he did not know how to gain a (replacement) ballot paper. There is no indication as to why he would not have received the letter and ballot paper at his home address. I infer that he did not receive a ballot paper prior to the count and he did not vote.

[36] One employee is on long term sick leave, was staying at a residence other than his designated address and indicated that the company did not apparently check his address before sending the mail.

[37] Another employee did not attend the final information session and was absent on sick leave between Tuesday 27 September and 10 October 2011. He did attend work on 10 October 2011 but was not approached by anyone about the ballot and indicated that he was not aware of who to speak to in relation to the ballot. He did not receive a postal ballot paper.

[38] Based upon the information before Fair Work Australia, all of the employees whose circumstances have been raised (except one who was not staying at their known address) actually attended the workplace either on the day of the ballot (6 October 2011) or at some stage up to and including 10 October 2011.

DID THE BALLOT RESULT PRODUCE GENUINE AGREEMENT WITHIN THE MEANING OF THE ACT?

[39] Provided the express procedural obligations have been met, the overriding consideration is whether the ballot results should be understood to represent the genuine agreement of the employees. This requires a real world consideration of the circumstances and not a forensic consideration of potential scenarios.

[40] In general terms, it is evident that the relevant pre-approval requirements of s.180 and s.181 have been met in this case. The measures undertaken by Balfours mean that it took all reasonable steps to ensure the access required by s.180(2) occurred. Further, and subject to two potential concerns, in my view it took all reasonable steps to notify the relevant employees of the time and place at which time the vote would occur and the voting method that was to be used, as required by s.180(3) of the Act. Subject to those same caveats to be discussed below, the ballot result would in my assessment represent the genuine views of the workforce for present purposes.

[41] I note that the timing of the briefings and the provision of the subsequent information, given that the ballot did not open until 6 October, meant that the relevant access period requirements of s.180(3) of the Act have been met. 9

[42] The sending of the letters to those who were expected to be absent, combined with the information and explanation otherwise provided, represented reasonable steps to notify the relevant employees. The material sent to those particular employees could reasonably be understood as indicating that “absentee” voting would be available for those not attending work on 6 October 2011.

[43] The mailing of appropriate material to the home addresses of the “absent” employees, with the lead times involved in this case, was also in my view all that would be reasonably required in their circumstances. I do not consider that it was reasonable or necessary for Balfours to individually check whether employees were at their nominated home address. I also do not consider that the fact that employees who were not living at their nominated address and had not advised the employer of any change, and therefore may not have received some or all of the material, undermines the veracity of the ballot.

[44] The first potential caveat is that the second letter and the ballot papers were provided only to those who were expected to be absent on the ballot day, 6 October 2011. There is at least one employee who was not expected to be absent but was away, due to illness. The second and related potential caveat is whether employees should have reasonably understood from the briefings and information supplied that even if absent on 6 October 2011, or not in receipt of a ballot for whatever reason, they could still cast a vote up until the time that the ballot was counted.

[45] Employees were advised that a ballot was being conducted and that it would be held on 6 October 2011. Those who attended the joint briefings, or received the written ballot advice and papers should have reasonably understood that the ballot would not be finalised until 10 October 2011. These employees should have been aware that voting up until the counting of the ballot was available. This is supported, at least in general terms, by the views of Mr Bone, one of the United Voice delegates involved in the process. 10 Mr Bone indicated as follows:

“...

To Whom it May Concern,

I have been a member of the Balfours Enterprise Agreement Committee and have been involved in several of the ballots in the past, including the most recent ballot.

I wish to state that Bruce Brown, Operations Manager at Balfours Bakery gave everybody the opportunity to vote right up to the last minute before the count that was held on the Monday.

There was at least 5 occasions when Bruce made himself available after the close of ballot to take further voting slips. I also witnessed that Bruce noticed some people that did not vote on the day was concerned and notified their immediate supervisor to return and vote.

Bruce also made Peter Pfeifer, Production Manager available if Bruce was unavailable to fill in, in his absence if needed.

The count of the ballot which was done on Monday 10 October 2011 was kept open to include the second mails of the day and the count included several postal votes that were returned.

I am satisfied that the ballot was conducted properly and the result is valid.

By no means was this letter in anyway coerced.

Alex Bone

Employee Representative

United Voice”

[46] In all of the circumstances evident here, with the exception of employees who were absent from work throughout the process and were not living at their known address, it is probable that all employees were aware that a ballot was being conducted. I accept that if an employee was relying solely on the information supplied to those absent from the briefings, did not attend work during the intervening period, did not receive the ballot paper and accompanying advice and did not make contact with management or United Voice about not receiving the ballot, they may not have been aware that the ballot was due to close on 10 October 2011. However, the written information, including that prominently displayed in the workplace, contained details of those responsible for the ballot should any employees wish to make enquiries.

[47] In that light, ideally, all of the written information provided to employees should have expressly stated that the ballot would remain open until it was due to be counted on 10 October and that if any employee could not attend on 6 October and/or had not received a ballot paper prior to 10 October for any reason, they could request one.

[48] However, given all of the particular circumstances of this matter, including the steps taken by Balfours in relation to the ballot as agreed following discussions with the joint enterprise agreement committee; the nature and size of this workplace; the holding of two previous ballots and the level of industrial sophistication more generally; and the generally constructive relationship between management and United Voice that permitted employees to contact their representatives or management about any concerns or the absence of ballot papers, I consider that the relevant employees who wanted to vote had an adequate opportunity to obtain a ballot paper and to participate in the ballot. As a result I consider that the ballot and its results are bona fide and even allowing for the broad application of s.188(c) of the Act, should be accepted as the basis of a genuine agreement in this case.

[49] I also consider that all reasonable steps to notify the relevant employees of the time and place at which the vote would occur, and the voting method that was to be used, had been taken prior to the start of the access period.

[50] In these circumstances, Balfours has complied with all of the relevant requirements of s.180, there is a valid agreement made as a result of the ballot, and there are no reasonable grounds to find that the employees have not genuinely agreed to the Agreement.

[51] Having considered all aspects of the application I was satisfied that each of the requirements of ss.186, 187 and 188 of the Act as are relevant to the application for approval had been met.

[52] The Agreement was approved in a decision issued under the Act and in accordance with s.54 will operate from 14 November 2011. The nominal expiry date of the Agreement is 17 October 2015.

COMMISSIONER

Appearances:

R Reid, of EMA Consulting (with permission) with D Banham for Balfours Bakery Pty Ltd.

L Harrison for United Voice.

Hearing details:

2011.
Melbourne:
October 27

Final written submissions and materials:

2011
November 2, 3 and 4.

 1   [2011] FWAA 7703, PR516531.

 2   I have considered the issues raised by the employee. No parties sought to comment on or be further heard as a result of those matters.

 3   I have not set out the names of these employees in this decision however their circumstances were fully canvassed by all parties in an open and constructive manner. One of the members was called and the other members provide evidence in the form of a sworn statement. In the absence of any challenge I have accepted this evidence on face value.

 4   This supplementary evidence was in the form of sworn statements. As with the United Voice statements, both parties were at liberty to seek a further hearing in the event that they wished to challenge that evidence or provide additional material.

 5   [2010] FWAFB 4602, 21 July 2010, per Watson VP, Kaufman SDP and Raffaelli C see in particular pars [29] to [32].

 6   I accept that such conduct might well fall foul of the good faith bargaining requirements of s.228(c) of the Act however this falls short of any express parameters for the conduct of a ballot or other employee approval process.

 7   I note that in Philmac Pty Ltd [2011] FWAFB 2668, 5 May 2011 per Boulton J, Kaufman SDP and Bissett C, the Full Bench speculated about the operation of s.188(c) of the Act. However, this was in the context of good faith bargaining obligations and no definitive view was taken. I also note the decision of the Full Bench Galintel Rolling Mills Pty Ltd T/A The Graham Group [2011] FWAFB 6772, 18 October 2011, per Watson VP, Acton SDP and Cambridge C, particularly at par [36[ as referred to by Balfours. That decision dealt with the requirements to provide a notice of employee representational rights and it did not address the role of the ballot or the implications of s.188(c) in that context. Further, the majority in the recent decision in S Bland v CEVA Logistics (Australia) Pty Ltd, [2011] FWAFB 7453, 4 November 2011 per O’Callaghan SDP and Kaufman SDP at par [43] appears to adopt the view that s.188(c) could be applied more broadly.

 8   Exhibit A4.

 9   The access period is defined by s.180(4) and in this case the period commenced on 29 September 2011.

 10   Mr Bone provided an unsworn statement (exhibit A5) which was admitted on a provisional basis. United Voice did not subsequently express any concerns about reliance upon that document.

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