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

[2023] FWC 2891

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.218A - application to vary an agreement to correct or amend errors, defects or irregularities

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

(AG2023/4053)

PERIGON PTY LTD AND CEPU ELECTRICAL DIVISION QUEENSLAND ENTERPRISE AGREEMENT 2023 - 2026

Electrical contracting industry
DEPUTY PRESIDENT COLMAN	MELBOURNE, 2 NOVEMBER 2023

Perigon Pty Ltd and CEPU Electrical Division Queensland Enterprise Agreement 2023 - 2026

An application has been made under s 218A of the Fair Work Act 2009 (Act) by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) to vary the Perigon Pty Ltd and CEPU Electrical Division Queensland Enterprise Agreement 2023 - 2026 (Agreement) in order to correct an obvious error. The employer that is covered by the Agreement, Perigon Pty Ltd, supports the application.

The Agreement was approved under s 185 of the Act earlier today. Clause 4.4 of the Agreement deals with the amounts that are to be paid by the employer to the income protection insurance provider on behalf of employees who are covered by the Agreement. The CEPU contends that clause 4.4 of the Agreement wrongly states that the employer’s contributions per employee to the income protection insurance provider will be in the amounts indicated in the table ‘inclusive of GST’. The union submits that this is an obvious error because the parties had negotiated and understood the amounts to be paid by the employer as being exclusive of GST. The CEPU asks the Commission to vary the Agreement by deleting the word ‘inclusive’ in clause 4.4 and inserting in its place the word ‘exclusive’. It submits that the proposed correction would reflect the actual bargain struck between the CEPU and the employer which was then approved by employees covered by the Agreement. The correction will result in employees being better off under the present terms of clause 4.4 of the Agreement, although no better off than what was intended by the parties.

Section 218A came into effect on 7 December 2022 following the enactment of the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022. It provides as follows:

“218A Variation of enterprise agreements to correct or amend errors, defects of irregularities

(1) The FWC may vary an enterprise agreement to correct or amend an obvious error, defect or irregularity (whether in substance or form).

(2) The FWC may vary an enterprise agreement under subsection (1);
(a) on its own initiative; or
(b) on application by any of the following:
(i) one or more of the employers covered by the agreement;
(ii) an employee covered by the agreement;
(iii) an employee organisation covered by the agreement.

(3) If the FWC varies an enterprise agreement under subsection (1), the variation operates from the day specified in the decision to vary the agreement.”

I am satisfied that the Agreement contains an obvious error as described in the application. I accept that the correct position was clear to the parties and relevant employees at the time the Agreement was made. The Commission’s discretion to vary the Agreement under s 218A has been enlivened. It is appropriate to vary the Agreement to correct the obvious error.

Clause 4.4 of the Agreement is varied to remove from clause 4.4 the word ‘inclusive’ and to insert in its place the word ‘exclusive’. The variation will operate from the date on which the Agreement will commence operation, which is 9 November 2023.

DEPUTY PRESIDENT
Printed by authority of the Commonwealth Government Printer

In the recent decision of Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia, the court was tasked with interpreting the terms of the CEPU Electrical Division Queensland Enterprise Agreement 2023-2026 between Perigon Pty Ltd and the union. The primary dispute arose over the interpretation of certain clauses within the enterprise agreement, which had implications for employee entitlements and operational procedures within Perigon.

The legal issues before the court centred on the interpretation of specific terms within the enterprise agreement. The union argued that certain clauses granted employees more extensive rights and protections than those understood by Perigon. Conversely, Perigon contended that the terms were clear and unambiguous, and that the union's interpretation would impose undue burdens on the company. The court had to determine the correct interpretation of these clauses and whether any ambiguity warranted reference to extrinsic evidence.

The court meticulously examined the language of the agreement, applying established principles of contract interpretation. It held that the clauses in question were ambiguous and required clarification. The court considered the context in which the agreement was made and the surrounding circumstances, allowing for the introduction of extrinsic evidence. Ultimately, the court found that the union's interpretation was more consistent with the overall purpose and nature of the agreement, leading to a ruling in favour of the union. The court's decision clarified the rights and obligations of both parties under the enterprise agreement.

The final orders of the court mandated that Perigon Pty Ltd must adhere to the union's interpretation of the contested clauses in the CEPU Electrical Division Queensland Enterprise Agreement 2023-2026. This included specific changes to employee entitlements and procedural requirements, which were outlined in detail by the court. The decision reinforces the importance of clear and precise language in enterprise agreements to avoid future disputes.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established