BHP Iron Ore Pty Ltd
[2024] FWCA 2223
•17 JUNE 2024
| [2024] FWCA 2223 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.185—Enterprise agreement
BHP Iron Ore Pty Ltd
(AG2024/1859)
BHP IRON ORE LOCOMOTIVE DRIVERS AGREEMENT 2024
| Mining industry | |
| DEPUTY PRESIDENT BEAUMONT | PERTH, 17 JUNE 2024 |
Application for approval of the BHP Iron Ore Locomotive Drivers Agreement 2024
BHP Iron Ore Pty Ltd (the Applicant) has made an application for the approval of an enterprise agreement known as the BHP Iron Ore Locomotive Drivers Agreement 2024 (the Agreement). The application was made under s 185 of the Fair Work Act 2009 (Cth) (the Act). The Agreement is a single enterprise agreement.
The Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) (Amending Act) made a number of changes to enterprise agreement approval processes in Part 2-4 of the Act, which commenced operation on 6 June 2023. By reason of the transitional arrangements for the Amending Act and the notification time for the Agreement of 1 November 2022, the genuine agreement requirements for agreement approval in Part 2-4 of the Act, as it was just before 6 June 2023, apply to the present application. Further, as the Agreement was made on 17 May 2024 the better off overall test provisions in Part 2-4 of the Act as amended on 6 June 2023 apply.
The scope of the Agreement extends to employees employed in the position of Crew Development Officers (CDOs). The CDOs were not previously covered by the predecessor to the Agreement, the BHP Billiton Iron Ore Locomotive Drivers Agreement 2014 (the Drivers Agreement).[1] The Drivers Agreement did not contain actual rates of pay for the roles it did cover, or a structure for remuneration increases. The Applicant submits that those matters have been conceded by the Applicant in response to the bargaining claims of the Mining and Energy Union (the MEU) over the last two years of bargaining for the Agreement.[2]
The Agreement has seen the Applicant move from the existing performance-based approach to setting rates of pay and annual pay increases, to instead have an enterprise agreement structure that applies to all employees within a classification, and thereafter having to manage the various impacts that has to individuals.[3]
As noted, the Agreement reflects the actual rates of pay for all classifications, including CDOs. There are 17 CDOs who fall within the scope of the Agreement.[4] The total number of employees who will be covered by the Agreement is 542.[5] Some CDOs currently receive a ‘legacy’ remuneration package that is more beneficial than the remuneration package provided in the Agreement. In order to preserve those more beneficial ‘legacy’ arrangements, the Agreement at Sch 1(c)(2) allows CDOs to elect to retain their current ‘legacy’ remuneration package or move onto the new Agreement package (with Agreement allowances). The Applicant expects those employees will elect whichever is the higher for them personally (and will therefore receive no less than what is provided in the Agreement).
The Applicant’s intention in offering the election process in the Agreement was to satisfy the feedback in the bargaining from CDOs, via their union representative, where some had provided feedback that they wanted to receive the Agreement remuneration structure and others had provided feedback that suggested their preference was to continue under the current remuneration structure (which is structurally differently from the Agreement).[6]
The Agreement governs the CDOs’ terms and condition of employment in respect of, amongst other things, rostering, job share, flight assistance, consultation and consultative committee, issue resolution, union rights and union delegates’ rights.
Having considered the evidence of Mr Ben O’Brien, Employee Relations Manager, and Mr Josh Cowan, Rail Operations Superintendent, I am of the view that employees who will be covered by the Agreement genuinely agreed to the Agreement. I further note that based on the evidence of Mr Cowan in respect of the duties undertaken by CDOs and their level of seniority, I have found that the CDOs are not covered by the applicable modern award, namely the Mining Industry Award 2020.
The better off overall test entails an overall, not a line by line, assessment of whether each award covered employee and each reasonably foreseeable employee would be better off under an agreement than the relevant award. This is clear from s 193. Further, s 193A now confirms, for the avoidance of doubt, that the Commission must undertake a ‘global’ assessment of whether each employee would be better off under the agreement than the award, having regard to the terms of the agreement which would be more beneficial to the employee than those in the award, and those that would be less beneficial.
I am satisfied that each Award covered employee and each prospective award covered employee for the Agreement would be better off over all under the Agreement. I observe that rates of pay under the Agreement are considered to be between 74.39% and 180.28% above those in the Award. As there is no award comparison for the purposes of s 193 of the Act for those employees who are CDOs, there are therefore no grounds for ‘better off overall’ concerns.[7]
The Applicant has opted to rely on the National Employment Standards precedence clause at clause 4(b) of the Agreement to address the issue at clause 15 of the Agreement, which provides for public holidays and states that employees working on shift are required to work in accordance with their roster. Clause 15 may be inconsistent with s 114 of the Act which provides that an employee is entitled to be absent from his or her employment on a day or part‑day that is a public holiday in the place where the employee is based for work purposes, unless the request to work is reasonable.
On the basis of the material contained in the application, the accompanying declarations, and the witness statements of Mr O’Brien and Mr Cowan, I am satisfied that each of the requirements of ss 186, 187 and 188 of the Act as are relevant to this application for approval have been met.
The MEU being a bargaining representative for the Agreement, has given notice under s 183 of the Act that it wants the Agreement to cover it. In accordance with s 201(2), and based on the declaration provided by the MEU, I note that the MEU is covered by the Agreement.
The Agreement was approved on 17 June 2024 and, in accordance with s 54, will operate from 24 June 2024. The nominal expiry date of the Agreement is 17 June 2028.
DEPUTY PRESIDENT
[1] AE408353.
[2] Witness Statement of Ben O’Brien dated 11 June 2024, [7]-[8].
[3] Ibid [12]-[16].
[4] Ibid [10].
[5] Ibid [11].
[6] Ibid [15]-[17].
[7] Sunnyhaven Limited [2012] FWAFB 9086, [8].
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