Civica BPO Pty Ltd

[2018] FWC 4376

[2018] FWC 4376

FAIR WORK COMMISSION

DECISION

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

Civica BPO Pty Ltd
(AG2018/1294)

DEPUTY PRESIDENT MASSON MELBOURNE, 31 JULY 2018

Application for approval of the IMES Business Services Agreement Bands 1-4 2018.

[1] An application has been made for approval of the IMES Business Services Agreement Bands 1-4 2018 (the Agreement). The application was made pursuant to s 185 of the Fair Work Act 2009 (the Act). It has been made by Civica BPO Pty Ltd (Civica BPO). The Agreement is a single enterprise agreement.

[2] A notice of employee representational rights was provided to employees on 15 February 2017. 1 Employees were provided with access to the Agreement and information about the effect of the terms of the Agreement on 8 March 2018. Employees were notified of the time, place and method of voting on 8 March 2018 and voting occurred on and from 15 March 2018 until 23 March 2018. A majority of those who voted approved the Agreement.

[3] The Australian Services Union (ASU) was a bargaining representative on behalf of employees for the Agreement.

[4] Civica BPO 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 Clerks Private Sector Award 2010 (the Award). 2 The statutory declaration noted that the provisions in the Agreement were more beneficial than the Award or were not conferred by the Award. Less beneficial terms were also identified.

[5] The ASU filed a statutory declaration supporting approval of the Agreement on 10 April 2018.

Pre-approval requirements

[6] In reviewing the Agreement for approval, the Commission identified a number of concerns with the Agreement and wrote to Civica BPO on 21 June 2018. Most of those concerns were addressed in the Civica’ BPO’s response received on 25 June 2018 which included submissions and undertakings on the various matter raised by the Commission.

[7] Following receipt of Civica BPO’s response on 25 June 2018, the Commission identified one outstanding issue. The Commission was concerned that, as employees had been advised of the ballot details on 8 March 2018 and had commenced voting for the Agreement on 15 March 2018, the required seven days’ notice required pursuant to s 180(3) of the Act had not been met. In subsequent correspondence dated 4 July 2018, the Commission directed the Applicant’s attention to a relevant recent Full Bench decision of the Commission, that of Construction, Forestry, Maritime Mining and Energy Union and Ors v CBI Constructors Ltd (CBI) 3 which was delivered on 21 June 2018.

[8] As a consequence of CBI and resultant concerns expressed by the Commission to the parties as to whether the Agreement was capable of being approved, Civica BPO sought to be heard in relation to the matter and a hearing was conducted on 20 July 2017. Present at the hearing were Mr David Owen and Ms Kate Hemmingway for Civica BPO and Mr David Leydon of the ASU along with delegates Ms Katrina Harris and Ms Evelyn Simmons.

Factual Background

[9] On 8 March 2018, Civica BPO sent an email to all employees who would be covered by the Agreement advising them of the details of the ballot to be conducted for approval of the Agreement. Employees were advised that the ballot would be conducted by means of an on-line survey that would commence on Thursday, 15 March 2018.

[10] On 15 March 2018, Civica BPO sent a further email, which included a hyperlink to the on-line survey, to all employees who would be covered by the Agreement, allowing voting by employees to commence consistent with advice provided to employees on 8 March 2018.

[11] On 21 March 2018 voting for the Agreement closed.

Civica BPO submissions

[12] Civica BPO acknowledged in their oral submissions the impact of the CBI authority and accepted that by reason of that authority, the notice of the ballot details provided to employees on 8 March 2018 did not ensure that seven clear calendar days (the access period) elapsed prior to commencement of the ballot on 15 March 2018. Civica BPO accepted that on the basis of the ballot commencing on 15 March 2018, the notice of the ballot details was required to have been provided to employees on 7 March 2018 to ensure that seven clear days elapsed.

[13] Whilst acknowledging that they had not provided sevens clear days’ notice of the ballot, they referred to their reliance on the Commission’s “Single enterprise agreement date calculator” tool (Date Calculator) which was amended by the Commission on 21 June 2018 to reflect the CBI decision. Civica BPO furnished copies of a printout of the Date Calculator results that they obtained and relied on in their pre-approval agreement making process.

[14] Civica BPO submitted that their reliance on the Date Calculator, along with the other steps taken to communicate the ballot details, constituted “all reasonable steps” having been taken by them and on that basis the s 180(3) requirements under the Act were met.

ASU submissions

[15] The ASU made written submissions in correspondence dated 6 July 2018 and supplemented those will oral submissions at the hearing in support of the application for approval of the Agreement.

[16] The ASU helpfully detailed the background to the making of the Agreement and the process of negotiation. The ASU confirmed that throughout the process, the parties acted in good faith and that there were no issues of difference or dispute in the making of the Agreement.

[17] The ASU acknowledged the matter of the timing of the notice to employees pursuant to s 180(3) of the Act which had been drawn to the attention of the parties by the Commission, but for its part, was not aware at the time of the ballot that there were any problems with the notice to employees.

[18] The ASU submitted that the error in the Date Calculator on which the Applicant relied was a relevant matter to be considered and that the Commission should exercise its discretion and approve the Agreement.

Relevant Statutory Provisions

[19] Section 186 prescribes a number of criteria about which the Commission must be satisfied in order for it to approve an enterprise agreement. For the purposes of the present matter s 186(2)(a) relevantly provides:

“186 When the FWC must approve an enterprise agreement—general requirements

…………….

Requirements relating to the safety net etc.

(2) The FWC 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

……………….”

[20] Section 188 defines when, for the purpose of s 186(2)(a) of the Act, employees can be said to have genuinely agreed to an agreement. It relevantly provides as follows:

“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 the FWC 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.”

[21] Section 180(3) deals with the steps required to be taken by an employer in notifying employees of the ballot to be conducted for an agreement and relevantly states as follows;

“(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.

[22] Section 180(4) defines the expression “access period” 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).

Consideration

[23] At this point, it is worth briefly summarising the agreement making process undertaken by Civica BPO, its employees and the ASU.

[24] Civica BPO agreed to commence bargaining on 1 February 2018. The last of the notices of representational rights were provided to employees on 15 February 2018. Negotiations proceeded without issue or disagreement between the parties to the point where in-principle agreement was quickly reached in early March 2018 and it was then determined to take the Agreement to ballot.

[25] Civica BPO sought to inform itself of the pre-approval procedural requirements for the purpose of conducting a ballot and to that end consulted the Commission’s website. Civica BPO specifically referred to and utilized the Date Calculator for the purpose of determining the relevant dates for conducting the ballot. The Date Calculator identified that in order for the ballot to commence on 15 March 2018, Civica BPO would need to provide employees with ballot details pursuant to s 180(3) of the Act on or by 8 March 2018.

[26] Armed with information on ballot notification timing requirements from the Commission’s Date Calculator, Civica BPO then emailed employees on 8 March 2018 notifying them of the ballot details and also directed employees to copies of the proposed agreement on Civica BPO’s intranet at the same time. The ballot was then conducted with a majority of employees who participated in the ballot voting to approve the Agreement.
[27] 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”. This is a mandatory requirement on which a failure to comply will prevent approval of an agreement.

[28] Neither party has contested that, for the purpose of the present matter, the relevant authority to be applied in determining when the “access period” commences is that of CBI. In that matter, the Full Bench was, on appeal, considering the operation of s 180(3) of the Act in circumstances where employees of CBI had been notified of the date, place and voting method on 22 June 2017 for a ballot to be conducted on 29 June 2017. In concluding that CBI had failed to comply with s180(3) of the Act, the Full Bench relevantly stated at paragraph [42] as follows:

[42] The above considerations cause us to conclude that s 180(4) is to be construed on the basis that the access period consists of seven clear calendar days, and that by the application of s 36(1) of the AI Act the access period ends at the end of the calendar day immediately preceding the day on which the voting process for a proposed agreement commences. This conclusion is consistent with the long-standing position that was established by the decisions in Hydro Electric Corporation and McKechnie Iron Foundry, with which decisions we agree.

[29] On the basis of the CBI authority, it is clear that the required seven clear calendar days did not elapse between the time of notice provided by Civica BPO to its employees on 8 March 2018 and commencement of the ballot on 15 March 2018. Observance of the seven clear calendar day “access period” requirement would have required notification of employees on or by 7 March 2018. That did not occur.

[30] In assessing compliance with s 180(3) of the Act, it is clear that the Commission must weigh the particular circumstances of the matter before it and whether the substance of, method and timing of the communication satisfies the requirement of all reasonable steps having been taken. I am satisfied that in the present matter the substance and method of communication to employees was appropriate. At issue is the timing of the notification and the fact that it was not provided to employees on or by the day immediately before commencement of the “access period”.

[31] Whilst acknowledging that it failed to notify employees on or by the day immediately before the commencement of the “access period”, Civica BPO contends that it nonetheless took “all reasonable steps” to do so having accessed and relied on the Commission’s Date Calculator.

[32] Consequently, the question before me is whether the reliance placed by the Applicant on the Date Calculator in determining the date on or by which it was required to provide notice to employees pursuant to s 180(3) of the Act, is a relevant matter to be weighed in determining whether the Applicant has taken “all reasonable steps” as required under s 180(3) of the Act.

[33] In considering the meaning of the term “all reasonable steps”, my attention is directed to consider whether the phrase is focussed only on the substance and form of communication used by an employer or whether “all reasonable steps” also includes the timing and steps taken by an employer to inform itself of its statutory obligations, and specifically in the present matter, the required notification timeframes.

[34] There is no doubt that the method and substance of communication pursuant to s 180(3) of the Act must be considered. By illustration, an employer that placed a single notice on a notice board in a head office advising employees of ballot details in circumstances where those employees were geographically dispersed and did not have access to that single notice, would inevitably in my view be found to have failed to take all reasonable steps to notify employees as required by s 180(3) of the Act. That is not to say that an email or registered post mail to every employees’ home addresses is necessary in all circumstances.

[35] The timing of provision of the notification pursuant to s 180(3) of the Act may also be a relevant consideration. For example, there may be circumstances in which some employees do not receive the notification prior to the commencement of “access period”. That may be due to employees being absent from the workplace or there may be new employees that commence employment during the access period. The fact that all employees may not have received notice prior to commencement of the access period does not necessarily mean that the employer has failed to take “all reasonable steps” as required by s 180(3) of the Act. It is whether the steps taken by the employer in the particular circumstances satisfy the requirement of “all reasonable steps” having been taken. That must be determined by the Commission evaluating and weighing all of the particular circumstances.

[36] On the basis of the above, it cannot be said that unless all employees have been notified prior to the commencement of the access period, then s 180(3) requirements are not met and the agreement cannot be approved. The particular circumstances leading to employees not being notified of agreement ballot details pursuant to s 180(3) of the Act prior to the commencement of the access period may be a relevant factor to be weighed.

[37] In the circumstances, it is difficult to identify what additional steps Civica BPO might have taken to ensure it complied with the requirements of s 180(3) of the Act. Perhaps out of an abundance of caution they might have allowed additional notification time prior to the commencement of the ballot, although their reliance on the Date Calculator would have given them a sense of assurance that they were complying with the notification requirements under s 180(3) of the Act.

[38] This is not a case where Civica BPO was careless or set about a course of conduct with a purpose of denying employees a reasonable opportunity to review and consider the Agreement prior to the ballot. Nor was it a case of the employer obtaining appropriate advice and then failing to follow it. There was clearly an intention on the part of Civica BPO to comply with the requirements of the Act. They consulted the Commission’s website, accessed the Date Calculator and then applied the resultant dates to their notification and ballot timetable.

[39] This brings me to consider and weigh whether the particular source of advice on which a party may rely on is a relevant factor for consideration in determining whether “all reasonable steps” have been taken pursuant to s 180(3) of the Act. For example, would the fact that a party may have relied on prior decisions of the Commission, now displaced by the CBI authority, be a relevant consideration in determining whether an employer had taken “all reasonable steps”. I believe not. Further, would a party’s reliance on legal advice obtained prior to and that was contrary to CBI authority on the meaning of “access period” and the relevant notification times pursuant to s 180(3) of the Act be a relevant consideration? Similarly, I believe not.

[40] Does the specific source of advice relied on by Civica BPO, that of the Commission’s Date Calculator since found by CBI to be incorrect, have a different character to that of reliance on displaced decision authority or legal advice based on that displaced decision authority? I am compelled to answer that question in the negative. In my view the source of incorrect advice is irrelevant. Incorrect advice obtained on the meaning of a provision of the Act, whether via legal opinion or where based on information obtained via an on-line tool on the Commission’s website, cannot displace or override the statutory requirements as determined by relevant decisions of the Commission or courts.

[41] While I have a deal of sympathy for Civica BPO in the circumstances, I am not persuaded that their reliance on the Commission’s Date Calculator has a substantively different character to that of reliance on incorrect legal advice. In summary, I do not believe that Civica BPO’s reliance on incorrect advice or opinion, wherever obtained, is a relevant consideration in determining whether it has taken “all reasonable steps” for the purpose of s 180(3) of the Act.

[42] The statutory requirement is clear. Civica BPO is required to have taken all reasonable steps to provide notice to employees to be covered by the Agreement pursuant to s 180(3) of the Act prior to the commencement of the “access period”. According to CBI the “access period” is to be construed as seven clear calendar days. Notice to employees of the ballot details provided by Civica BPO on was not provided seven clear calendar days prior to the Agreement ballot commencing on 15 March 2018.

[43] Having concluded that a party acting (albeit in good faith) on incorrect advice is not a relevant consideration for the purpose of s 180(3) of the Act, I am not persuaded that Civica BPO has taken all reasonable steps to communicate the Agreement ballot details to employees prior to commencement of the access period as required under s 180(3) of the Act.

[44] It is understandable that the parties may be deeply frustrated with the outcome where reliance was placed on the Date Calculator prepared by the Commission and made available on its website to assist parties in calculating the relevant periods of notice, and that tool was subsequently found to be in error by reason of a Full Bench authority. That is the regrettable result in the present matter. The absence of discretion available to me to overcome what is clearly a procedural failure will also likely be a matter of some frustration to the parties.

Conclusion

[45] I am not satisfied that the Agreement has been genuinely agreed to (within the meaning of s 188 of the Act) by the employees covered by the Agreement for the purposes of s 186(2) of the Act. This is because Civica BPO has not complied with s 180(3) of the Act.

[46]
For the reasons given I cannot approve the Agreement. The application to approve the Agreement is dismissed.

DEPUTY PRESIDENT

Appearances:

D Owen and K Hemmingway for the Applicant.

D Leydon of the Australian Services Union

Hearing details:

2018.

Melbourne (by telephone).

20 July.

Printed by authority of the Commonwealth Government Printer

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 1   Section 173 of the Act.

 2   MA000002.

 3   [2018] FWCFB 2732.