Bhagwan Marine Pty Ltd

[2019] FWC 6328

[2019] FWC 6328

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.210—Enterprise agreement

Bhagwan Marine Pty Ltd
(AG2019/1393)

BHAGWAN MARINE PTY LTD INSHORE MARITIME ENTERPRISE AGREEMENT 2016

Maritime industry
COMMISSIONER WILSON	MELBOURNE, 11 SEPTEMBER 2019

Application for variation of the Bhagwan Marine Pty Ltd Inshore Maritime Enterprise Agreement 2016.

[1] An application has been made for approval of a variation to the Bhagwan Marine Pty Ltd Inshore Maritime Enterprise Agreement 2016 (the Agreement). The application was made by Bhagwan Marine Pty Ltd pursuant to s.210 of the Fair Work Act 2009 (the Act) on 29 April 2019.

[2] The Agreement was approved on 30 May 2016 1 and was varied by Deputy President Gostencnik on 6 February 2019.2

[1] On 18 July 2019, the Fair Work Commission (the Commission) sent an email to the Applicant, Mr Dan Ortiz raising concerns under ss.180(2), 180(3) and 180(5) of the Act, regarding the effect of the variation on the scope of the Agreement, the National Employment Standards and the Better Off Overall Test.

[2] On 25 July 2019, an email was received from the Applicant responding to some but not all of the concerns of the Commission while also requesting clarification in relation to some of the BOOT concerns.

[3] In response to this request, on 29 July 2019, the Commission attempted to contact the Applicant by phone however, was unsuccessful. Later the same day, the Applicant contacted the Commission by phone whereby clarification was provided regarding the concerns raised by the Commission. An email was sent by the Commission to the Applicant confirming the clarification provided earlier by phone.

[4] On 30 July 2019, an email was received from the Applicant containing submissions in relation to the concerns raised by the Commission.

[5] On 18 August 2019, the Commission sent an email to the Applicant regarding remaining concerns in relation to compliance with ss. 180(3) and 180(5) of the Act. The Applicant did not respond to this correspondence.

[6] On 28 August 2019, the Commission contacted the Applicant by phone regarding the correspondence sent on 18 August 2019, however, was unable to reach him. A message was left with a member of staff requesting a call back from Mr Ortiz although, no response was received.

[7] On 29 August 2019, the Commission again called Mr Ortiz, however was unable to reach him. A further message was left with the same member of staff who confirmed the previous message had been passed on to Mr Ortiz. No response was received.

[8] On 30 August 2019, the Commission sent an email to the Applicant seeking a response. No response was received.

[9] On 4 September 2019, after numerous attempts to contact the Applicant had been made, the Commission sent a final email to the Applicant seeking a response to the remaining concerns and putting him on notice that should the Applicant fail to respond, that the application would be determined on the materials before the Commission resulting in dismissal of the matter. Again, no response was received to this email. A copy of this correspondence was also sent via express registered post to the Applicant which has been confirmed as having been delivered on 5 September 2019. To this date the Commission has received no response from the Applicant.

[10] Section 211(1)(a) of the Act requires the Commission to approve a variation if it is satisfied that had an application been made under ss.182(4) or s.185 for the approval of the agreement as proposed to be varied, the FWC would have been required to approve the agreement under section 186.

[11] Section 180(3) of the Act requires an employer to take all reasonable steps to notify the relevant employees of the date and place at which the vote will occur and of the voting method to be used “by the start of the access period”.

[12] Section 180(4) sets out the meaning of ‘access period’ relevantly as follows:

…

(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).

[13] The responses to questions 2.2 and 2.5 of the Form F23A provides that notification of the vote was provided to employees on 17 April 2019, seven days prior to commencement of the vote on 24 April 2019. In accordance with the Full Bench decision in CFMMEU v CBI Constructors Pty Ltd 3it does not appear that seven clear days’ (i.e. 8 days) notice of the vote was accorded to employees pursuant to s.180(3) of the Act. While the Commission has the power under the Act to exercise discretion and find that but for minor procedural or technical errors which were not likely to have disadvantaged employees that the agreement has still been genuinely agreed to, (see s.211(3)(c); s.188(2)) the evidence before the Commission does not indicate that such discretion should be exercised. Namely, the Form F23A indicates that only 31 of 50 affected employees cast a valid vote, with 21 employees who cast a valid vote, voting to approve the variation. While it may be that the failure to provide 8 days’ notice of the vote is a minor procedural error, based on the low voter turnout and absent and further explanation from the Applicant as to the effect of the error on employees, I cannot be satisfied that this error did not disadvantage employees.

[14]

[15] Moreover, s.180(5) of the Act requires an employer to take all reasonable steps to ensure that the terms of the agreement, and the effect of those terms are explained to relevant employees and that the explanation is provided in an appropriate manner taking into account the particular needs and circumstances of the of the relevant employees.

[16] The response to question 2.3 of the Form F23A provides that:

“The geographical isolation of vessels and roster patterns limit the ability of the HR/IR Manager to physically visit each employee.

Comprehensive explanation of variation was submitted to all employees via email. This included information of the variation, the reason/effect of the variation on the enterprise agreement.”

[17] An email dated 16 April 2019 was also provided as part of lodgement which explained the proposed variation and its effect as follows:

“…

2.0 Variations

The parties to the Agreement seek to vary the terms of the Agreement as follows:

Variation 1

Amend Clause 2.0 SCOPE & APPLICATION

Subclause 2.1 has been amended after the words “in connection with Inshore Work in” by removing the wording in the original agreement of “Australia other than employees covered by the following agreements;“, and replacing this in the varied agreement with “all parts of Australia other than the Northern Territory and Western Australia and their adjacent waters extending to the limits of the Exclusive Economic Zone where other enterprise agreements will apply”

Reason / Effect of Variation 1

As the mentioned agreements have now expired, Bhagwan Marine require to update the exclusion in the Scope and Application to exclude Western Australia and Northern Territory to proceed with bargaining and approvals for new Enterprise Agreements in these regions.

Variation 2

Amend Clause 2.0 SCOPE & APPLICATION

Subclause 2.2 has been amended deleting the words “This Agreement does not apply to employees; engaged under the Bhagwan Marine Pty Ltd North West Vessel and Maritime Unions Enterprise Agreement 2015; engaged under the Bhagwan Marine Pty Ltd Northern Territory and Maritime Unions Enterprise Agreement 2015;“, and replacing this in the varied agreement with subclause 2.3 which will now be known in its entirety as subclause 2.2 “This Agreement contains a statement of mutual rights and obligations applying to the parties and is intended to cover all matters pertaining to wages and conditions of the Employees. Whilst it remains in force, this Agreement shall operate to the exclusion of any other agreement or award that may have application to the Employees’ employment now or in the future unless stated otherwise “

Reason / Effect of Variation 2

As the mentioned agreements mentioned in Subclause 2.2 have now expired, Bhagwan Marine may now delete reference to these agreements as negotiations have started to replace the above mentioned.

Note: All other terms and conditions of the Agreement remain unchanged.

[18] Based on the above material provided to the Commission, while I am satisfied that the Applicant provided employees with the proposed text of the relevant variations, I am not satisfied that the “effect” of these changes was adequately explained. Namely, both clauses which the Applicant seeks to vary have significant impact on the scope of the Agreement which has not been explained to employees. For example, by varying the scope of the Agreement as proposed there will likely be employees who were previously covered by the Agreement who will no longer be covered by it should the variation be approved. Additionally, the explanation states that given the agreements in “subclause 2.2 have now expired, Bhagwan Marine may now delete reference to these agreements as negotiations have started to replace the above mentioned”. This does not accurately reflect the process of termination of agreements which is provided for by the Act and is misleading to employees. Moreover, by removing these employees from coverage this may weaken their bargaining position in future negotiations without their knowledge. As such, I am not satisfied that s.180(5) of the Act has been complied with.

[19] As a result of the foregoing, I am not satisfied the requirements under s.210 of the Act have been met. The material that is contained in the Form F23A does not provide a basis on which I might be satisfied that the Applicant has complied with some of the required steps before asking employers to approve the Variation.

[20] I am also not satisfied that relevant employees genuinely agreed to the variation because I am not satisfied that the Applicant complied with ss.180(3) and 180(5) of the Act.

[21] The Applicant has been given adequate opportunities to provide further information but has provided no response despite efforts of the Commission to procure an explanation.

[22] For these reasons the application is dismissed.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

<AE419196  PR712152>

 1   AE419196.

 2   PR600135.

 3   [2018] FWCFB 2732.