City of Kalgoorlie-Boulder

[2017] FWCA 6460

[2017] FWCA 6460

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

City of Kalgoorlie-Boulder
(AG2017/3458)

CITY OF KALGOORLIE-BOULDER UNION COLLECTIVE WORKPLACE AGREEMENT FOR DEPOT AND KALGOORLIE GOLF COURSE FIELD STAFF 2017

Local Government Industry
DEPUTY PRESIDENT MASSON	MELBOURNE, 7 DECEMBER 2017

Application for approval of the City of Kalgoorlie-Boulder Union Collective Workplace Agreement for Depot and Kalgoorlie Golf Course Field Staff 2017.

[1] An application has been made for approval of the City of Kalgoorlie-Boulder Union Collective Workplace Agreement for Depot and Kalgoorlie Golf Course Field Staff 2017. The application was made pursuant to section185 of the Fair Work Act 2009 (the Act). It has been made by the City of Kalgoorlie-Boulder. The agreement is a single enterprise agreement.

[2] A notice of employee representational rights was provided to employees on 28 February 2017 1 and the notice complied with the regulations.2 Employees were provided with access to the proposed agreement and information about the effect of the terms of the Agreement along with a notice of the time and place and method of voting was provided to employees on 26 July 2017. Voting occurred on 3 August 2017 and a majority of those who voted approved the Agreement.3

[3] The Western Australian Shire Councils, Municipal Road Boards, Health Boards, Parks, Cemeteries and Racecourse, Public Authorities Water Boards Union WA Division (the LGRCEU) was the bargaining representative on behalf of employees for the Agreement.

[4] The City of Kalgoorlie-Boulder filed a statutory declaration in support of the Agreement. The statutory declaration noted that the relevant award for the purpose of the better off overall test was the Local Government Industry Award 2010 4.

[5] The statutory declaration noted that the provisions in the proposed Agreement were more beneficial than the Award or were not conferred by the Award. No less beneficial terms were identified.

[6] The LGRCEU filed a statutory declaration supporting approval of the Agreement on 11 August 2017. The LGRCEU subsequently made submissions to the Commission in correspondence dated 20 August 2017 in which they objected to the approval of the Agreement. The objections specifically related to clause 11.1 Kalgoorlie Loyalty Payment.

[7] On 6 November 2017, the Commission wrote to the City of Kalgoorlie-Boulder and the bargaining representative and advised that the Commission held concerns in relation to the proposed Agreement. Specifically that:

1. The Agreement did not provide the authority of the employee signatory.

2. It was unclear what date employees were provided with copies of the proposed Agreement and accompanying materials prior to the ballot.

3. It was unclear whether there were any relevant circumstances or needs of employees that needed to be taken into account by the City of Kalgoorlie-Boulder when explaining the terms of the Agreement.

4. Clause 29 of the Agreement dealing with consultation did not allow for a change to regular rosters or ordinary hours of work, or consequently for the employer to invite or consider the views of employees about changes to rosters or ordinary hours of work.

5. Clause 18.5.3 of the Agreement failed to comply with the National Employment Standards (NES) with respect to paternity leave provisions.

6. Clause 10.5.4 Supported Wage Rates of the Agreement provided for an amount payable to employees on a supported wage of $73 per week compared to the relevant Award rate of $84 per week.

[8] Employee representatives also made submissions with the respect to clause 10.2 in the Agreement in which they claimed that the wage increase had been processed on a fortnightly basis rather than on a weekly basis that they believed had been agreed.

[9] The City of Kalgoorlie-Boulder replied in correspondence to the Commission on 10 November 2017 with the following responses and undertakings pursuant to s190 of Act:

1. A revised signature page was provided with the employee signatory authority with full details as required.

2. Information was provided confirming that the necessary pre-approval steps had been taken by the City of Kalgoorlie-Boulder in terms of the provision of the Agreement and associated materials and details of the ballot process.

3. Confirmed its understanding that the model consultation clause would apply.

4. Provided an undertaking in relation to clause 18.5.3 Paternity Leave as follows;

“The City of Kalgoorlie-Boulder confirms that an employee’s paternity leave entitlement as described in clause 18.5.3 will be defined as per section 72(5)(a) of the Fair Work Act for the purposes of the National Employment Standards (NES).”

5. Provided an undertaking in relation to clause 10.5.4 Supported Wage Rates as follows;

“The City of Kalgoorlie-Boulder confirms that the minimum amount payable for employees on a supported wage as described in clause 10.5.4 will be $84.00 per week as per clause 4.2 of the Local Government Industry Award 2010”

6. Confirmed that wage increases had been backdated and processed on the basis of a weekly increase from 3 July 2017.

[10] A Hearing by telephone was conducted by the Commission on 1 December 2017 to deal with the outstanding issue raised by the LGRCEU’s regarding clause 11.2 of the Agreement. Mr J Walker, Ms I Bishop, Ms Y Roberts and Ms M Gray appeared for the City of Kalgoorlie-Boulder. Mr A Johnson appeared on behalf of the LGRCEU and was accompanied by Mr R Cullen and Mr A Markoff who are employees of the City of Kalgoorlie-Boulder and whose employment would be covered by the proposed Agreement.

Does the Agreement satisfy the better off overall test?

[11] At the Hearing on 1 December 2017, the City of Kalgoorlie-Boulder adopted the submissions they had made in correspondence dated 10 November 2017. In relation to the issue of clause 11.2 raised by the LGRCEU, Mr Walker on behalf of the City of Kalgoorlie submitted that the proposed Agreement satisfied the better off overall test.

[12] Mr Walker stated that the provision in clause 11.2 Kalgoorlie Loyalty Payment was in like terms to other agreements recently lodged by the City of Kalgoorlie-Boulder with the Commission and which had been approved. Mr Walker, in answer to questions from the Commission, also drew attention to the margin in wage rates between that of the Agreement and the relevant Award. The margin of the Agreement wage rates above the Award ranged between twenty seven and forty seven percent.

[13] Mr Walker explained that the issue of contention between the City Of Kalgoorlie-Boulder and the LRGCEU was that of the imposition of a freeze on the loyalty payment increments through the life of the Agreement.

[14] Mr Johnson on behalf of the LGRCEU conceded in his submissions that the issue in contention was not that clause 11.2 raised any issues with respect to the Agreement failing to meet the better off overall test. Rather it was a desire of the LGRCEU and its members to resolve an issue of Agreement interpretation prior to the approval of the Agreement as opposed to pursuing a dispute over the interpretation of the Agreement following its approval.

[15] Mr Johnson explained the LGRCEU’s interpretation of clause 11.2 and that in its view, on any clear reading of the provision, there was no reference to a freeze of the loyalty payment increments for existing employees. In making this submission Mr Johnson acknowledged the Commission’s statutory obligations to approve agreements subject to pre-approval, NES and better off overall test considerations being satisfied.

Consideration

[16] I have considered both the written and verbal submissions of the parties in relation to the proposed Agreement. It is apparent that the clause in contention (clause 11.2) is a beneficial provisions relative to the Award and that rates of pay in the Agreement are significantly above the Award. Neither party made submissions that the Agreement failed to satisfy the better off overall test.

[17] Having reviewed the rates of pay in the Agreement, excluding the contested Kalgoorlie Loyalty Payments, I am satisfied that the margin of Agreement rates above the relevant Award rates ranges between twenty seven and forty seven percent. Consequently I do not regard the issue of the contested interpretation of clause 11.2 as raising any concerns regarding the better off overall test.

Was the Agreement genuinely approved?

[18] It is clear that in a relatively short period of time following the approval of the Agreement by a ballot of employees that a difference of opinion has emerged between the parties in relation to the interpretation of clause 11.2 of the Agreement. This raises the question as to whether the City of Kalgoorlie-Boulder has taken all reasonable steps to ensure the distribution and explanation of the terms of the Agreement to employees as required under s180(2) and (5) of the Act.

[19] The relevant provisions of the Act are to be found at sections 180(2) and (5) and are as follows;

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

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.

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.

[20] The City of Kalgoorlie-Boulder detailed the process by which it distributed the Agreement and associated materials to employees. They stated at question 2.4 of their F17 as follows;

“All supervisors and managers were notified to advise all employees that a meeting had been called to distribute the printed and written text agreement and relevant supporting documentation. Adequate notice was provided to ensure all could attend. The meeting was scheduled at the Depot facility and Golf Course to ensure both parties were briefed. At the scheduled meeting employees were briefed on the process and advised what they were about to receive was a copy of the agreement, a 2 page summary outlining the main agreement points and a letter which described the process for a vote and confirmed the date, time and location.

As employee collected the copy of the Agreement and documentation they were ticked off a list to ensure nobody was missed. All employees that were unable to attend were individually contacted and provided a copy.”

[21] With respect to explaining the terms of the Agreement, and the effect of those terms, to the relevant employees, the City of Kalgoorlie-Boulder stated as follows at question 2.6 of their F17;

“During the negotiation period all employee and employee representative queries in relation to the agreement were addressed promptly and well communicated. Employees were provided with a summary document which outlined the relevant sections of the agreement.”

[22] Further, at question 2.7 of the City of Kalgoorlie-Boulder’s F17 they stated as follows;

“Employees were encouraged to discuss the agreement with their colleagues, work teams, supervisors, and representatives and bargaining reps. The Chief executive officer also addressed any queries and concerns with employees direct. Information was also communicated through the employee notice boards, internal mail and intranet.”

[23] The LGRCEU in their F18 statutory declaration supported the City Of Kalgoorlie-Boulder’s Agreement application and did not raise any objections to the employer’s statutory declaration.

Consideration

[24] It is of concern that in a relatively short period of time a difference of opinion on a significant term within the Agreement has arisen. I am unable to conclude that the difference in opinion arises from weaknesses in the process of explanation of the terms of the Agreement to the relevant employees as opposed to there being genuine differences in understanding between the parties.

[25] The material before the Commission indicates that the City of Kalgoorlie-Boulder has taken reasonable steps to both distribute and explain the terms of the Agreement to the relevant employees. It is also persuasive that the relevant information provided by the employer in their F17 statutory declaration was not contested by the LGRCEU.

[26] On the basis of the above I am satisfied that the City of Kalgoorlie-Boulder has met the requirements under section 180 in terms of the distribution of the agreement and supporting documents to the relevant employees and explaining those terms and their effects to those employees. Consequently I am also satisfied that the Agreement was genuinely approved.

Conclusion

[27] A copy of City of Kalgoorlie-Boulder undertakings are attached in Annexure A. Having heard from the City of Kalgoorlie-Boulder, the LGRCEU and employees Mr Cullen and Mr Markoff, I am satisfied that the Agreement with the undertakings passes the better off overall test.

[28]  I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement.

[29] Subject to the undertakings referred to above, I am satisfied that each of the requirements of sections 186, 187, 188 and 190 of the Act as are relevant to this application for approval have been met.

[30] The LGRCEU, being a bargaining representative for the Agreement, has given notice under section 183 of the Act that it wants the Agreement to cover it. In accordance with section 201(2), I note that the Agreement covers the organisation.

[31] The Agreement was approved on 7 December 2017 and, in accordance with section 54 of the Act, will operate from 14 December 2017. The nominal expiry date of the Agreement is 30 June 2020.

DEPUTY PRESIDENT

ANNEXURE A

 1   Section 173 of the Act

 2   Section 174 of the Act

 3   Section 180 of the Act

 4   MA000112

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