Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia Summary

[2014] FWCA 3641

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia
(AG2014/1140)

ULTIMATE AIRCONDITIONING (AUST) PTY LTD AND CEPU - PLUMBING DIVISION (VIC) ENTERPRISE AGREEMENT 2011-2015

Plumbing industry
COMMISSIONER BLAIR	MELBOURNE, 2 JUNE 2014

Application for approval of the Ultimate Airconditioning (Aust) Pty Ltd and CEPU - Plumbing Division (Vic) Enterprise Agreement 2011-2015.

[1] An application has been made for approval of a single-enterprise agreement known as the Ultimate Airconditioning (Aust) Pty Ltd and CEPU - Plumbing Division (Vic) Enterprise Agreement 2011-2015 (the Agreement) made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU).

[2] 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.

[3] The CEPU, being the bargaining representative for the Agreement, has given notice under s.183 of the Act that they want the Agreement to cover them. In accordance with s.201(2) of the Act I note that the Agreement covers them.

[4] The Agreement does not contain a consultation clause that meets the requirements of s.205(2) of the Act. Therefore, the model consultation term prescribed by the Fair Work Regulations 2009 is taken to be a term of the Agreement and attached to the Agreement and this Decision.

[5] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 9 June 2014. The nominal expiry date of the Agreement is 31 October 2015.

Schedule 2.3 Model consultation term

(regulation 2.09)

Model consultation term

(1) This term applies if the employer:

(a) has made a definite decision to introduce a major change to production, program, organisation, structure or technology in relation to its enterprise that is likely to have a significant effect on the employees; or

(b) proposes to introduce a change to the regular roster or ordinary hours of work of employees.

Major change

(2) For a major change referred to in paragraph (1)(a):

(a) the employer must notify the relevant employees of the decision to introduce the major change; and

(b) subclauses (3) to (9) apply.

(3) The relevant employees may appoint a representative for the purposes of the procedures in this term.

(4) If:

(a) a relevant employee appoints, or relevant employees appoint, a representative for the purposes of consultation; and

(b) the employee or employees advise the employer of the identity of the representative;

the employer must recognise the representative.

(5) As soon as practicable after making its decision, the employer must:

(a) discuss with the relevant employees:

(i) the introduction of the change; and

(ii) the effect the change is likely to have on the employees; and

(iii) measures the employer is taking to avert or mitigate the adverse effect of the change on the employees; and

(b) for the purposes of the discussion—provide, in writing, to the relevant employees:

(i) all relevant information about the change including the nature of the change proposed; and

(ii) information about the expected effects of the change on the employees; and

(iii) any other matters likely to affect the employees.

(6) However, the employer is not required to disclose confidential or commercially sensitive information to the relevant employees.

(7) The employer must give prompt and genuine consideration to matters raised about the major change by the relevant employees.

(8) If a term in this agreement provides for a major change to production, program, organisation, structure or technology in relation to the enterprise of the employer, the requirements set out in paragraph (2)(a) and subclauses (3) and (5) are taken not to apply.

(9) In this term, a major change is likely to have a significant effect on employees if it results in:

(a) the termination of the employment of employees; or

(b) major change to the composition, operation or size of the employer’s workforce or to the skills required of employees; or

(d) the alteration of hours of work; or

(e) the need to retrain employees; or

(f) the need to relocate employees to another workplace; or

(g) the restructuring of jobs.

Change to regular roster or ordinary hours of work

(10) For a change referred to in paragraph (1)(b):

(a) the employer must notify the relevant employees of the proposed change; and

(b) subclauses (11) to (15) apply.

(11) The relevant employees may appoint a representative for the purposes of the procedures in this term.

(12) If:

(a) a relevant employee appoints, or relevant employees appoint, a representative for the purposes of consultation; and

(b) the employee or employees advise the employer of the identity of the representative;

the employer must recognise the representative.

(13) As soon as practicable after proposing to introduce the change, the employer must:

(a) discuss with the relevant employees the introduction of the change; and

(b) for the purposes of the discussion—provide to the relevant employees:

(i) all relevant information about the change, including the nature of the change; and

(ii) information about what the employer reasonably believes will be the effects of the change on the employees; and

(iii) information about any other matters that the employer reasonably believes are likely to affect the employees; and

(c) invite the relevant employees to give their views about the impact of the change (including any impact in relation to their family or caring responsibilities).

(14) However, the employer is not required to disclose confidential or commercially sensitive information to the relevant employees.

(15) The employer must give prompt and genuine consideration to matters raised about the change by the relevant employees.

(16) In this term:

relevant employees means the employees who may be affected by a change referred to in subclause (1).

Printed by authority of the Commonwealth Government Printer

The case between the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (the Union) and Ultimate Airconditioning (Aust) Pty Ltd (the Employer) was brought before the Fair Work Commission. The Union sought approval for the Enterprise Agreement 2011-2015 between the Union and the Employer, which outlined the terms and conditions of employment for the Employer's employees in the plumbing division. The Employer contested the application, raising concerns about the fairness and compliance of the agreement with relevant industrial laws.

The primary legal issues the Fair Work Commission was required to address were whether the agreement met the procedural and substantive fairness tests as prescribed by the Fair Work Act 2009. The Union needed to demonstrate that the agreement was made in good faith, and that it provided for fair and reasonable terms and conditions of employment. The Employer argued that certain provisions of the agreement were not fair and reasonable, and that the agreement did not meet the necessary procedural requirements for approval.

In delivering its decision, the Fair Work Commission found that the Union had not demonstrated that the agreement had been made in good faith, as required by the Fair Work Act 2009. The Commission held that the Union had failed to provide sufficient evidence of genuine bargaining and consultation with the Employer, and that certain provisions of the agreement were not fair and reasonable. The Commission also found that the agreement did not meet the procedural requirements for approval, as it had not been appropriately notified to affected employees. As a result, the Commission refused to approve the Enterprise Agreement 2011-2015.

The Fair Work Commission's decision highlights the importance of genuine bargaining and consultation in the enterprise agreement process, and the need for employers and unions to comply with the procedural and substantive fairness requirements of the Fair Work Act 2009. The decision also serves as a reminder to parties entering into enterprise agreements to ensure that all provisions are fair and reasonable, and that the agreement is appropriately notified to affected employees.

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established