Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v EnerMech Pty Ltd T/A EnerMech

[2019] FWC 353

[2019] FWC 353

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.236 - Application for a majority support determination

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia
v
EnerMech Pty Ltd T/A EnerMech
(B2018/1143)

COMMISSIONER HUNT BRISBANE, 24 JANUARY 2019

Application for majority support determination - script read to employees to encourage signatures to an employee petition – custody of the petition - work to cease in less than five months - reasonable in all the circumstances – determination made

[1] This decision relates to an application made by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) under section 236 of the Fair Work Act (2009) for a majority support determination to undertake bargaining for an agreement to cover employees of EnerMech Pty Ltd T/A EnerMech (EnerMech) at the Ichthys Project (the project) in Darwin.

[2] When complete, the project will be an onshore liquefied natural gas processing plant. The project is said by EnerMech to be 99.7% complete.

[3] The CEPU is one union party to an expired enterprise agreement made by EnerMech employees with EnerMech on the project (the 2015 Agreement). The nominal expiry date of the 2015 Agreement is 31 October 2018, and it continues in force until it is either replaced or terminated in accordance with the Act.

[4] The CEPU seeks to bargain on behalf of members for a new enterprise agreement. EnerMech does not agree to bargain with employees for a new enterprise agreement on account of the project coming to an end in a reasonably short period of time.

Relevant Legislation

[5] Section 236 of the Act relates to applications for majority support determinations:

“236 Majority support determinations

(1) A bargaining representative of an employee who will be covered by a proposed single enterprise agreement may apply to the FWC for a determination (a majority support determination) that a majority of the employees who will be covered by the agreement want to bargain with the employer, or employers, that will be covered by the agreement.

(2) The application must specify:

(a) the employer, or employers, that will be covered by the agreement; and

(b) the employees who will be covered by the agreement.”

[6] Section 237 of the Act sets out the legislative tests for a majority support determination:

“237 When the FWC must make a majority support determination

Majority support determination

(1) The FWC must make a majority support determination in relation to a proposed single enterprise agreement if:

(a) an application for the determination has been made; and

(b) the FWC is satisfied of the matters set out in subsection (2) in relation to the agreement.

Matters of which the FWC must be satisfied before making a majority support determination

(2) The FWC must be satisfied that:

(a) a majority of the employees:

(i) who are employed by the employer or employers at a time determined by the FWC; and

(ii) who will be covered by the agreement;

want to bargain; and

(b) the employer, or employers, that will be covered by the agreement have not yet agreed to bargain, or initiated bargaining, for the agreement; and

(c) that the group of employees who will be covered by the agreement was fairly chosen; and

(d) it is reasonable in all the circumstances to make the determination.

(3) For the purposes of paragraph (2)(a), the FWC may work out whether a majority of employees want to bargain using any method the FWC considers appropriate.

(3A) If the agreement will not cover all of the employees of the employer or employers covered by the agreement, the FWC must, in deciding for the purposes of paragraph (2)(c) whether the group of employees who will be covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.

Operation of determination

(4) The determination comes into operation on the day on which it is made.”

Hearing

[7] The matter was heard before me on 21 January 2019. Mr Joseph Kennedy, Principal of Hall Payne Lawyers appeared for the CEPU. Mr Christopher Murdoch, QC, instructed by Mr Martin Osborne, Partner of Norton Rose Fulbright appeared for EnerMech. Leave was granted pursuant to s.596(2)(a) of the Act to both parties to be represented due to the complexity of the issue and the efficiencies the representatives would bring to the matter.

[8] The following witnesses gave evidence and were cross-examined:

● Mr David Hayes, CEPU Organiser;

● Mr James Scott, EnerMech employee and CEPU delegate;

● Mr Brenton Grantham, HR/IR Manager;

● Mr Martin Bottolfsen, Area Manager and Project Director.

[9] Directions were issued in December 2018 for the CEPU to file with the Fair Work Commission (Commission) the original, un-redacted version of a petition of employees who seek to bargain with EnerMech for a new enterprise agreement. The directions also required the CEPU to provide to EnerMech a redacted copy of the petition.

[10] EnerMech was directed to file with the Commission an extract from its payroll records identifying each employee who would be covered by an enterprise agreement within the categories of employees in the application. The date the employee records were required to reflect was 14 December 2018.

[11] The parties complied with the directions. The EnerMech payroll records evidenced that as at 14 December 2018 there were approximately 548 employees falling within the scope of the application.

[12] On 18 January 2019, EnerMech provided to the Commission an updated list of employees employed on the project as at 18 January 2019. The project is nearing completion, and many employees are no longer required, with regular tranches of employees being let go, or some employees resigning. The updated list reflected approximately 484 employees, with a handful of employees having resigned their employment with imminent dates for their last day of employment.

[13] In these particular applications, it is often the case that the relevant Commission member will have before them the roll of employees, together with the list of employees who have signed a petition seeking the commencement of bargaining. In all likelihood, the employer does not wish for the relevant union to know the names of all employees, and therefore cannot share its list; and the relevant union does not wish for the employer to know the names of its members, or non-members who wish to bargain, and likewise, cannot share its list. It is suggested that if employees are free to enter their name onto a petition with some assurance that their employer will not have the opportunity to see their name, there is a greater likelihood of employees putting their name to a petition to bargain.

[14] Having received the updated list of employees shortly before the commencement of the hearing, it was necessary for the Commission, the holder of the common information, to determine how many employees employed as of 18 January 2019 had signed the petition to bargain. This is a detailed exercise, examining scanned pages of original signed petitions, determining if the hand-written name on the petition matches that of an employee on the employer’s roll. I undertook this exercise and was satisfied that there were at least 300 employees employed as at 18 January 2019 who had signed their names to the petition.

[15] I say ‘at least’ as it is not always easy to read the hand-written names of employees. I consider the number of 300 employees to be a conservative number, and it may, in fact, be greater than this. Nevertheless, 300 employees is a majority against a roll of 484 employees.

Application opposed

[16] The application was opposed by EnerMech on several grounds. It was submitted that the onus of satisfying the Commission that a majority support determination should be made rests with the CEPU. 1 EnerMech contended that the Commission could not be satisfied that the prerequisites in s.237(2) of the Act have been met because:

(a) the CEPU has not demonstrated that a majority of employees want to bargain;

(b) the CEPU has not established that the group of employees referred to in the application is fairly chosen; and

(c) the CEPU has not established that it is reasonable in all the circumstances to make the determination.

[17] On the issue of demonstrating that a majority of employees want to bargain, this was broken into several discrete arguments:

(a) the importance of the relevant period of time the majority of employees is to be determined; and

(b) in order to form the requisite degree of satisfaction, the Commission cannot simply accept a petition at face value, and it is appropriate to consider the means by which the petitions were obtained, the custody and control of the documents, what was said to influence the employees to sign the petition, who was in the room or not in the room;

[18] By the date of the hearing, and based on the Commission’s calculations performed on 18 January 2019, EnerMech was satisfied that pursuant to the relevant period of time, there was a majority of current employees’ names present on the petitions.

[19] During the hearing, and having heard the evidence of witnesses relevant to the scope of the 2015 Agreement, the scope sought by the CEPU in the application relevant to a new enterprise agreement, and a recent variation sought to the 2015 Agreement by EnerMech, opposition to the group of employees not being ‘fairly chosen’ was not pressed.

CEPU’s evidence

[20] In relation to the provisions of s.236(1) of the Act, the CEPU submitted that it is a bargaining representative and therefore entitled to make this application. The application identifies the employer to be covered by the agreement and the employees to be covered by the agreement.

Mr David Hayes

[21] Mr Hayes is a CEPU Organiser responsible for the Ichthys project. Mr Hayes was informed by EnerMech on 15 October 2018 that it had proposed a variation to employees of the 2015 Agreement, however the proposed variation was voted down by employees with an 88% ‘no’ vote.

[22] The CEPU wrote to EnerMech on 16 October 2018 informing that it wished to negotiate with EnerMech in relation to a proposed enterprise agreement. The last pay rise received by employees was 1 May 2018.

[23] Noting that there was only a ‘short period of time before the proposed completion date of the project’, the CEPU proposed the new agreement be a ‘rollover’ of the 2015 Agreement, and for a minimum period of 12 months. Improved rostering for employees was sought, together with a 2.5% wage increase each 6 months of the agreement. Further, the CEPU offered to review the terms of the 2015 Agreement to ensure a new agreement would comply with the Code for the Tendering and Performance of Building Work 2016 (the Building Code or the Code).

[24] The following day the CEPU requested a meeting date to further the agreement negotiations. Many emails were exchanged between the parties until 19 November 2018, when EnerMech informed the CEPU in writing that it had decided not to negotiate a new enterprise agreement.

[25] Mr Hayes exercised various right of entry visitations during October and November 2018 and discussed with employees the CEPU’s intention to bargain for a new agreement. As a result of EnerMech’s failure to indicate a willingness to bargain, it was determined that a majority support determination would be sought through a petition of employees.

[26] The petition was headed:

“Majority Support Determination

We, the undersigned employees intend to bargain for an enterprise agreement with our employer, EnerMech Pty Ltd, (“the employer”) at 931 Cockburn Road, Henderson, WA 6166.

As far as we, the employees, are aware, the employer has refused to bargain with us.

The proposed enterprise agreement would cover trade and non-trade employees employed to perform work on the Ichthys Project at Bladin Point in the Northern Territory.”

[27] Mr Hayes informed Mr Scott of the following relevant to the petition:

(a) all employees had to be given a free choice as to whether to sign;

(b) employees could be assured that we the CEPU would not provide the petitions to EnerMech so that confidentiality would be maintained;

(c) if employees had any questions that needed to be answered they could contact Mr Hayes;

(d) the process had to be systematic, and the CEPU had to maintain control of the petitions, kept in Mr Scott’s care;

(e) all shifts needed to be covered to give everyone an opportunity whether to sign or not; and

(f) the names on the petitions had to be legible.

[28] Mr Scott collected the petitions and provided the original, signed petitions to Mr Hayes on 23 November 2018.

[29] In oral evidence Mr Hayes stated that there are three matters the CEPU wishes to bargain for in a new enterprise agreement which does not accord with EnerMech:

(a) a movement from a 28/7 roster to a 26/9 roster. That is, instead of 28 days on, 7 days off, the members seek a roster of 26 days on, 9 days off;

(b) a 2.5% increase effective 1 November 2018 and 2.5% increase effective 1 May 2019;

(c) a 12 month agreement.

Mr James Scott

[30] Mr Scott is employed by EnerMech as an electrician. He has been working on the project since November 2017 and is a CEPU delegate.

[31] As a result of EnerMech not agreeing to bargain with employees, the CEPU determined that a majority support determination would be sought, and Mr Scott was charged with collecting signatures of employees between 21 – 23 November 2018.

[32] Mr Scott’s evidence is that he visited numerous crib rooms over the three days and during his own breaks. Some of the crib rooms are a 10 minute walk from each other and he was covering this distance during his breaks. On 21 November 2018 he had Mr Aaron Hore, a fellow electrician with him. On 22 November 2018 he had Mr Tim Gloury, a fellow electrician with him.

[33] When addressing the employees Mr Scott stood before them in each crib room and explained the purpose of the petition and left a petition in each crib room that he entered. He read from a script, prepared with the assistance of Mr Hayes. The script read:

“Majority Support Petition

All employees,

If you want to further negotiations in relation to the EBA we require the majority of the workforce to sign this petition.

Everyone does so of there [sic] own free will. It is your own decision.

I will leave the petition here and return to collect it at the end of the break.

Names need to [be] legible as the FWC will be checking them.

We will be back later in the week to cover the shift change with the same process.

No pencil or red pen.

This list does not go to management, its presented to the FWC and they cross reference it with a list provided by the employer.

No voters this is the next step in the process, yes voters this is your opportunity to further your claim, union or non union it will effect [sic] you all the same.”

[34] When addressing the employees, his evidence is that he was asked questions by some of the employees. Some asked, following Mr Scott reading the script, whether they had to be union members to sign the petition? He answered no. Others asked if he thought a new enterprise agreement would be made before the end of the project? He answered that he did not know or that it wasn’t clear yet.

[35] Mr Scott requested that in reach room he entered, the petitions be left on a particular table, and he stated that he would return to collect them. It is Mr Scott’s evidence that if he needed to wait for employees to finish signing the petitions, he waited outside the room to give people the opportunity to sign the petition. He adopted this approach because he did not want to be ‘hovering’ around the employees as they passed the petition around because he did not want anyone to feel pressured in to signing the petition.

[36] When he re-entered each crib room he asked if there was anybody else who wanted to sign the petition. He stated that there were no questions or concerns raised during each crib break when he re-entered the room to collect the signed petitions.

[37] Mr Scott’s evidence is that he collected the petitions and put them in his folder which he kept at home until it was collected by Mr Hayes.

EnerMech’s evidence

Mr Brenton Grantham

[38] Mr Grantham is EnerMech’s HR/IR Manager. He commenced in the role on 21 May 2018.

[39] Mr Grantham does not have direct knowledge of planning and forecasting of the timeframes for completion of the work required by EnerMech, but in his role he is aware of the manning schedule until the end of the project.

[40] In November 2018 EnerMech employed approximately 539 craft employees on the project, and since that time approximately 70 employees have either resigned, have been terminated for unsatisfactory behaviour or performance, or been terminated due to redundancy.

[41] EnerMech expects to have completely demobilised its workforce by 30 June 2019. There are only three main subcontractors, including EnerMech on the project and completing works.

[42] EnerMech employees not covered by the enterprise agreement include the following groups of employees:

(a) Project Managers;

(b) Superintendents;

(c) Supervisors;

(d) HSE Advisers;

(e) Administration and payroll staff;

(f) Engineering employees;

(g) Project planners; and

(h) Cost Controllers.

[43] As the nominal expiry date of the 2015 Agreement was approaching, EnerMech considered that a variation to the 2015 Agreement was the quickest and most effective way to implement changes to provide a pay increase to employees, extend the agreement and make it Code-compliant. This approach was adopted as EnerMech wished to avoid the risk of disruption as a result of any protected industrial action at a late stage of the project.

[44] The CEPU have not provided EnerMech with a full log of claims. Mr Grantham is aware that the CEPU seeks a varied roster in a new agreement, and has seen stickers posted around the project which say “It’s 26/9 time”. EnerMech’s contract with JKC requires it to seek approval from JKC before agreeing to any changed terms with employees, and EnerMech is not agreeable to making such roster changes.

[45] Mr Grantham’s evidence is that the 2015 Agreement does not prescribe a specific roster, and accordingly the issue could be discussed with EnerMech and JKC without the need to bargain for a new enterprise agreement, although he does not consider that agreement would be reached due to schedule and cost implications. He considers that the CEPU is trying to achieve the new roster through bargaining, and not through general discussion so that the CEPU can exert additional pressure on EnerMech and JKC through the use of protected industrial action.

[46] If an agreement to the rosters could be reached, it is Mr Grantham’s evidence that it could not be implemented until the start of a new roster cycle due to the logistical realities of reorganising flights and accommodation, administrative requirements, notifying employees and coordinating employees’ rest and recreation leave.

[47] If EnerMech is required to bargain by a determination of the Commission, Mr Grantham would be pulled from his other duties. He is the only employee relations staff member on the project. He expects that EnerMech would need to engage an additional resource to assist with the bargaining or take over some of Mr Grantham’s other duties. He considers this an additional unnecessary and wasted expense during a time when EnerMech is downsizing its workforce on the project.

[48] Mr Grantham’s evidence is that on his calculations, it would take at least three weeks for EnerMech to consult with JKC and other stakeholders prior to the first bargaining meeting. This would include discussions regarding the impact of the roster and the terms within the 2015 Agreement. Mr Grantham’s experience is that it is difficult to schedule meetings of this sort in a timely fashion given that many people would need to be involved and have various rosters, and some are on rest and recreation leave.

[49] The bargaining process would take several months, including drafting proposed amendments, considering the cost and completion implications of any proposed amendments, consulting with JKC, meeting with the CEPU to try to negotiate an agreement and consulting with the workforce. Mr Grantham does not consider that an agreement could be reached.

[50] If agreement was reached while employees remained employed, it would take two weeks to draft the necessary consultation documents and complete information sessions with the workforce to advise on the terms and effect of the proposed agreement. It would take this long as it would need to capture both roster swings.

[51] An access period of at least seven days is required pursuant to the Act. The vote would need to be concluded, and a further one week would be required to determine the vote and complete the necessary documents for lodgement with the Commission for approval of the agreement. The time for consideration of the approval of the agreement by the Commission must also be considered.

[52] In cross-examination Mr Grantham agreed that it is possible that the work on the project could extend beyond 30 June 2019. He further agreed that Darwin, and the project could be exposed to an unexpected weather event, blowing out the projected completion time for EnerMech and its employees. He agreed that EnerMech is involved in commissioning equipment on-site and that work is on-going. He stated that EnerMech is making a further 50 or so employees redundant this week.

Mr Martin Bottolfsen

[53] Mr Bottolfsen has been employed by EnerMech for four years and is the Area Manager and Project Director on the project. He stated that the project is 99.7% complete. EnerMech has completed 85% of its work on one part of the project, and 95% on a second part of work on the project.

[54] Mr Bottolfsen is actively involved in the process of planning and forecasting the timeframes for the completion of EnerMech’s subcontracted works. The works are projected to be completed by 30 June 2019. The substantive construction work on the project will be completed in March 2019, and commissioning and testing by 30 June 2019.

[55] The forecast of employee requirements is as follows:

(a) by 15 February 2019, 358 craft employees;

(b) by 15 March 2019, 170 craft employees;

(c) by 15 April 2019, 125 craft employees;

(d) by 15 May 2019, 108 craft employees;

(e) by 30 June 2019, EnerMech plans to have completely demobilised its workforce.

[56] In cross-examination Mr Bottolfsen agreed that there is a low probability of an extension to the forecasting of employee requirements. He agreed that he cannot completely exclude the forecast extending beyond 30 June 2019. He stated that EnerMech is on target to hit the 30 June 2019 date.

CEPU submissions

Majority of employees want to bargain

[57] The CEPU submitted that relevant to s.237(3) of the Act, it has relied on a petition conducted in late November 2018 to demonstrate that a majority of employees want to bargain. Having account of the Commission’s calculations of 18 January 2019, a clear majority of current employees want to bargain.

[58] It is submitted that it is well established that a petition is a valid method for determining whether a majority of employees want to bargain. In NUW v Cotton On Group Services Pty Ltd [2014] FWC 6601, Commissioner Roe stated:

“[41] I am satisfied that the petition and the bargaining forms are a reasonable and appropriate way in which I can be satisfied that as at 9 September 2014 the majority of employees in the group to be covered wish to bargain for an agreement.”

[59] In Re MEAA[2014] FWC 8898, Commissioner Cribb stated:

“[31] There are a number of decisions of the Commission where a petition has been accepted as an appropriate means of establishing a majority employee position. There is nothing before me which would persuade me to not follow the “usual” approach of the Commission in this regard.”

[60] Relevant to how the CEPU went about obtaining signatures on the petition, it is submitted that it was conducted in a rigorous and systematic manner. Mr Hayes assisted by preparing a script for Mr Scott to read aloud to employees, ensuring a consistent message to all employees. He assisted with questions if they were asked by employees.

[61] All employees were invited to sign the petition, despite the way they voted for the failed variation, and whether they are union members or not.

[62] Positive steps were taken by Mr Scott to ensure that all employees understood that they could use their free will to elect to sign the petition or not sign the petition. It is submitted that there is no evidence of coercion or intimidation, and there is no basis to doubt the petition’s integrity.

[63] The CEPU took important steps to ensure the custody of the various petitions once they had been collected. It is submitted that the Commission ought to be satisfied that individuals signed the petitions, and they did so freely.

Employer has not yet agreed to bargain

[64] The CEPU stated that there is no doubt that EnerMech has refused to bargain, and accordingly s.237(2)(b) is satisfied.

Group of employees fairly chosen

[65] It is submitted that the group of employees to be covered by the proposed agreement is identical to those covered by the 2015 Agreement. For the 2015 Agreement to have been approved, the Commission needed to have satisfied itself that the group of employees to which it was applied was fairly chosen. It is submitted that there is no reason for the position to have changed, and s.237(2)(c) is satisfied.

Reasonable in all the circumstances to make the determination

[66] In Australian Licensed Aircraft Engineers Association v Panasonic Avionics Corporation[2013] FWC 4267, Watson VP said:

“[13] If all other criteria are satisfied I do not consider that there is any reason why a determination should not be issued. The objects of the Act clearly encourage bargaining when a majority of employees wish it to occur. It is not sufficient in my view for an employer to oppose bargaining on the grounds that it considers it to be undesirable when a majority of its employees want it to occur.”

[67] It is submitted that this view has been endorsed in subsequent decisions of the Commission. 2 It is submitted that the right to bargain under the Act is an important right, and there is nothing before the Commission that might warrant such an important right being denied in circumstances where a majority of employees support it.

[68] It was submitted that a purpose of the Act is to facilitate collective bargaining. A collective group of employees’ desire to bargain with their employer should not be overridden by an employer’s unwillingness.

[69] Relevant to whether an enterprise agreement will be made during any bargaining, reference was made to the a Full Bench decision in Alcoa of Australia Limited v Construction Forestry, Mining and Energy Union [2015] FWCFB 1832 where the Full Bench held:

“[31] The final point made by Alcoa concerning the “fairly chosen” consideration was that the Commissioner erred in failing to find that the working conditions of PSO6 employees were incompatible with typical terms of an enterprise agreement. This submission is, with respect, misconceived. The making of a majority support determination does not pre-suppose that an enterprise agreement will be made containing particular terms. It does not pre-suppose that an enterprise agreement will be made at all. To attempt to predict what the outcome of enterprise bargaining might be if a majority support determination is made, and then to have regard to that in deciding whether such a determination would be made, would involve the Commission taking into account an entirely speculative and irrelevant consideration. We agree with the following statement made in this connection in Construction, Forestry, Mining and Energy Union v CBI Constructions Pty Ltd in response to a submission that a majority support determination should not be made where an employee’s existing terms and conditions of employment were “competitive and current”:

“[17] CBI argues that the 2007 Agreement will continue to apply and that the ITEA's covering employees had sought to be terminated. If the ITEA's were terminated then the terms and conditions of those employees would be covered by the 2007 Agreement, supplemented by a set of conditions known as the Pluto Project Conditions. These terms and conditions, CBI argues, are current and competitive. The assertion seems to be that as the actual terms and conditions are current and competitive then that is not reasonable in all the circumstances for me to make the MSD. This to me seems to misunderstand the nature of bargaining and the role of FWA in MSD applications. It is not for FWA to make any judgments at all about the appropriateness or otherwise of the terms and conditions applying or of any sought, particularly at this juncture. FWA's role is limited to ascertaining whether a majority wanted to bargain for an enterprise agreement that would cover them.” 
(Emphasis added.)

[70] The CEPU referred the Commission to the decision of Commissioner Lee in “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Top Cut Food Industries Pty Ltd T/A Top Cut Food Industries; Caterfare Pty Ltd[2017] FWC 2798. In that decision, Commissioner Lee was faced with a similar scenario where the work was very imminently due to cease, and a majority support determination was sought.

[71] The Commissioner made the determination on 26 April 2017 in an ex tempore decision, with evidence before him that the work would cease due to an expected site closure on 1 June 2017. The employer’s reasons for not wishing to commence bargaining in that matter are cited below in the later published decision:

“[10] In terms of consultation in regards to the change Mr Bevacqua gave evidence about the company’s consultation with the AMWU and with employees directly, about the closure. This is set out at paragraph 17 of Mr Bevacqua’s witness statement. Mr Bevacqua, also gave evidence about his view in relation to commencing bargaining for an enterprise agreement at paragraph 18 of his witness statement:

“It is my view that we should not be forced to commence bargaining for an enterprise agreement in the present circumstances, I hold this view because:

a. I want to devote what energy and resources which we have available to assisting impacted employees to find jobs, (including facilitating meetings with labour hire providers, having employees off the production floor periodically for CV writing, interview training and support in identifying opportunities to find employment). Commencing enterprise bargaining is going to devote resources which could be better spent;

b. In the context where many employees are likely to be terminated and in which no employees will shortly work at the Laverton Site I do not understand the strategic objective of bargaining for an enterprise agreement at this site;

c. I doubt very much if bargaining will result in achievement of an agreement in short period of time which is left between now and the closure of the site.”

[72] In that matter, the AMWU wished to commence bargaining, even in the very narrow window available, to obtain improved severance entitlements for affected employees.

[73] The Commissioner determined that the window of approximately five weeks was a material consideration relevant to whether it is reasonable in all the circumstances to make the determination. He also considered the pressures on the company and the diversion of resources that bargaining would necessarily cause. The Commissioner determined:

“[23] I am not satisfied that, in all the circumstances, it is unreasonable to make the order such that the wishes of the majority of employees to bargain are not given effect to, as per the clear objective of the Act. For these reasons, I consider it reasonable to make the order sought.”

EnerMech submissions

[74] It was submitted that the Commission must be positively satisfied that the requirements of s.237(2) of the Act are met given the express requirements of the Act and the consequences of making such a determination. 3

Majority of employees want to bargain

[75] It was submitted that the decisions in Re MEAA[2014] FWC 8898 and NUW v Cotton OnGroup Services Pty Ltd[2014] FWC 6601 highlight the importance of positive evidence in relation to petitions and how they are administered, how information is provided to employees, the basis on which signatures are obtained and provided, free will, witnessing and custody.

[76] The issue of custody was discussed by Commissioner Booth in Veolia where she stated: 4

“[44] In my view, to establish the requisite satisfaction it is necessary to establish, on the evidence before the Commission, in this case that the petitions were at all times under the custody and control of responsible persons whether they be organisers or delegates. That has not been shown on the evidence.”

[77] Commissioner Lee discussed the issue of duress, coercion and confusing statements made to employees in Edlyn Foods 5where he stated:

“[7] Circumstances may arise where a petition cannot be relied upon as a means for Fair Work Australia to determine whether or not there is majority support for bargaining. One example may be duress or coercion of employees. Another example of a circumstance where it would not be proper for Fair Work Australia to accept a petition may be where the proposition that was put to employees was in some way confusing or not clear……”

[78] It was submitted that the evidence of Mr Scott as to his custody of the signed petitions is inadequate to meet the CEPU’s evidentiary burden, given he did not have custody and control of the signed petitions at all times. The petitions were left in crib rooms without a ‘responsible person’ to ensure that individuals signed in their own right.

[79] As to the script used by Mr Scott, EnerMech submitted that it would be misleading, particularly to ‘yes’ voters, as the CEPU is not about ‘furthering their claim’, as their claim was for one payment of 2.5% and a 6 month agreement. It was submitted that it would cause confusion for the ‘yes’ voters and it strikes at the reliability of the exercise.

Employer has not yet agreed to bargain

[80] EnerMech accepts that it has refused to bargain, and accordingly s.237(2)(b) is satisfied.

Group of employees fairly chosen

[81] During closing submissions it was submitted that it was open to the Commission, and I understood that it was not contested that the Commission could be satisfied that the group of employees who will be covered by the agreement was fairly chosen, and accordingly, s.237(2)(c) is satisfied.

Reasonable in all the circumstances to make the determination

[82] EnerMech’s evidence demonstrates that its work on the project is nearing completion and is 95% and 85% complete, and the project as a whole is 99.7% complete. The employees will be made redundant in tranches. It is projected that by 30 June 2019 no EnerMech employees will remain on site.

[83] Section 171 of the Act states the objects of the making of enterprise agreements as follows:

“171 Objects of this Part

The objects of this Part are:

(a) to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and

(b) to enable the FWC to facilitate good faith bargaining and the making of enterprise agreements, including through:

(i) making bargaining orders; and

(ii) dealing with disputes where the bargaining representatives request assistance; and

(iii) ensuring that applications to the FWC for approval of enterprise agreements are dealt with without delay.”

[84] EnerMech submitted that enterprise agreements should, pursuant to the Act, deliver productivity benefits. On the CEPU claim, it contains no such productivity benefits, and essentially it creates a myriad of work to perform in EnerMech resisting a roster change campaign that will have no utility and could not be introduced in the time span allowed, even if it were agreed. EnerMech would need to devote significant time and resources to bargain for a new enterprise agreement. It may need to hire an additional resource.

[85] EnerMech submitted that the bargaining process will be protracted and span several months. Even if agreement could be reached, an enterprise agreement would not be finalised and approved prior to the completion of the work and demobilisation of EnerMech employees. It is submitted that there is no utility in undertaking the exercise to bargain.

[86] It is submitted that the CEPU has not acted expeditiously in seeking to bargain.

[87] In Monadelphous, 6 Commissioner Simpson said the following:

“[63] In the ordinary course where the other elements of s.237(2) have been met, it would be expected that satisfaction of ss.237(2)(d) follows. However s.237 (2)(d) must have work to do. The circumstances on the particular facts of this case are quite unusual and the consideration under s.237 (2)(d) has become central to determining the matter.”

[88] The Commissioner concluded that Monadelphous had presented positive evidence and substantive argument as to why it would not be reasonable in all of the circumstances to make the determination, where it was not really challenged in any meaningful way by the relevant unions in those two matters. He concluded that the applicants in those matters had not met the onus on them to satisfy the Commission that it would be reasonable in all of the circumstances to make the determination.

CEPU reply submissions

[89] Relevant to the Veolia decision referred to at [76], the CEPU submitted that in that particular matter, the relevant signed petitions were not securely stored for more than one month. 7 Accordingly the matters can be distinguished where in this application, the signed petitions were secure.

[90] No employees were called by EnerMech to give evidence that they felt pressured to sign the petition or that they were misled. Where Commissioner Simpson determined in Monadelphous that there was no evidence as to what employees were told when asked to sign a petition, in this matter the Commission can be comfortable that Mr Scott read from a script and kept the communication consistent.

[91] It was submitted that it is not the Commission’s job to assess whether bargaining can be concluded in the time remaining on the project. In an event, it was submitted that EnerMech’s forecasting is speculative. Any number of factors could extend the work beyond May 2019.

[92] It was submitted that granting the determination merely commences bargaining, and does not require the parties to make a bargain. Where there is an objective at s.171 of the Act for productivity benefits, EnerMech may review the 2015 Agreement, and accordingly, it is not clear, once bargaining has commenced, what productivity benefits EnerMech might seek.

[93] The Commission should not have regard to whether industrial might occur or not once bargaining has commenced.
[94] Finally, it was submitted that all of the statutory criteria have been met.

Consideration

[95] Relevant to the capacity of the CEPU to make an application under s.236 of the Act, I am satisfied that it is a bargaining representative of at least one employee who will be covered by a proposed enterprise agreement.

[96] The application meets the requirements of s.236(2) of the Act.

Majority of employees want to bargain

[97] On the information before me, and having performed the calculation myself, I am satisfied that a majority of current employees’ names and signatures are present on the petition.

[98] Pursuant to s.237(2)(a)(i), I have determined the relevant period in time to be 21 January 2019, the date of the hearing. The employee records provided by EnerMech are accurate to 18 January 2019, and the evidence before the Commission is that they are relatively consistent to 21 January 2019.

[99] I have intensely scrutinised the coloured scanned petitions provided by the CEPU. I note each person’s signature and their written name appears to me to be unique. There is no basis for me to conclude that individual(s) wrote a person’s name and signed the petition on behalf of other employees.

[100] I have considered other decisions of this Commission and I accept that the petition put for consideration of all relevant employees is a suitable method in which to obtain the views of employees as to whether they wish to pursue bargaining or not. The wording of the petition is clear and unambiguous.

[101] I have considered the evidence relevant to what was said by Mr Scott in proposing the petition to employees. I accept his evidence that the script at [33] was used, and where questions raised by employees, the questions were suitably answered to the best of Mr Scott’s ability.

[102] I do not accept that ‘yes’ voters were potentially misled or actually misled. At the time of the petition being proposed to employees, including to ‘yes’ voters, their ‘claim’ of a 2.5% increase and a 6 month agreement had not been met and could not be met without a majority of employees agreeing. I see nothing misleading in the statement, “Yes voters [,] this is your opportunity to further your claim.” It is true that ‘yes’ voters had not achieved their ‘claim’ at this point in time, and the CEPU was informing such voters that by signing the petition, it was their opportunity to further their claim.

[103] Relevant to the blank petitions left in the crib while Mr Scott attended on other crib rooms, in these circumstances I do not hold any concerns. I accept Mr Scott’s evidence that he did not wish for the employees to feel intimidated or coerced into putting their name and signature to the petition while he was in the room for a lengthy period of time.

[104] In these particular circumstances, I consider it may be potentially intimidating for an employee, union member or not, to have a delegate attend the crib room in which the employee is enjoying a break for up to 30 minutes, and have the delegate present for the entire time or majority of the time to watch over the petition. Mr Scott’s evidence is that he attended numerous rooms over three days. I expect that he attended upon many that he would not normally enter when having his own meal. An employee enjoying a break who did not wish to sign the petition would, in my view, be more comfortable if he or she was afforded some ‘space’ to make such a decision, than having an elected union delegate present who does not ordinarily attend that crib room.

[105] That is not to say that there might be other circumstances where it is appropriate for a union delegate or organiser to be present, to be a ‘responsible person’ in control of a petition. Where, for example, there was concern that a single employee or a group of employees could intimidate other employees, or even attempt to improperly mark the petition, it would be entirely appropriate for a union delegate or organiser to be present, so long as they did not engage in intimidating behaviour.

[106] As to the custody of the signed petitions, I accept Mr Scott’s evidence that he maintained strict control and security over the signed petitions until they were in Mr Hayes’ possession, who in turn delivered them safely to Hall Payne Lawyers. I am satisfied the signed petitions were properly held upon collection by Mr Scott.

[107] Having considered all of the above issues I am satisfied that a majority of employees want to bargain and s.237(2)(a) of the Act is met.

Employer has not yet agreed to bargain

[108] I am satisfied that EnerMech has not yet agreed to bargain, or initiated bargaining for the proposed agreement, and accordingly s.237(2)(b) is met.

Group of employees fairly chosen

[109] The application nominates the same scope contained within the 2015 Agreement, together with the same scope of the variation sought by EnerMech to the 2015 Agreement in October 2018.

[110] It is true that there are a number of employees employed by EnerMech and not covered by this application. Those employees are not craft employees, and have not been covered by the same enterprise agreement as the employees the subject of this application.

[111] At the conclusion of the evidence it was no longer a contested issue, and I am satisfied that the EnerMech employees excluded by the coverage of the 2015 Agreement and by this application perform roles very different to the roles performed by the craft employees. I am satisfied that the employees the subject of this application, and covered by the 2015 Agreement are fairly chosen, taking into account the considerations in s.237(3A) of the Act. Accordingly, s.237(2)(c) is met.

Whether reasonable in all of the circumstances to make the determination

[112] Where VP Watson stated in Australian Licensed Aircraft Engineers Association v Panasonic Avionics Corporation 8that if all other criteria in 237(2) are satisfied he does not consider that there is any reason why a determination should not be issued, I note that the consideration relevant to s.237(2)(d) was not in issue in that case. It was not a contested issue, and respectfully, there is indeed work for appropriate consideration of whether it is reasonable in all the circumstances to make a determination even if the other criteria have been satisfied.

[113] I consider Commissioner Simpson’s consideration in Monadelphous to be persuasive. If an employer does not hold any objections relevant to s. 237(2)(a), (b) or (c), any objections an employer holds relevant to s.237(2)(a) must be properly considered, with the onus falling upon the applicant to satisfy the Commission that it is reasonable in all the circumstances to make the determination. An application could be refused on failing to satisfy the Commission relevant to s.237(2)(d) alone. It carries as much weight as the other considerations.

[114] In a Full Bench decision in CBI Constructors Pty Ltd v Construction, Forestry, Mining and Energy Union[2011] FWAFB 7642, the Full Bench said:

“[39] We accept that evidence of the sort led by CBI as to demobilisation of its workforce on the Project and its program to complete that demobilisation by 7 May 2010 was evidence that was manifestly relevant to whether or not it was reasonable to make the majority support determination sought by the CFMEU. In a particular case, evidence of this sort may lead to a conclusion that it is not reasonable to make a majority support determination. However, in circumstances where the Deputy President was not satisfied that CBI would not have employees on the Project beyond 7 May 2010 it was well within his discretion to conclude that it was reasonable to make the determination sought by the CFMEU.

[40] We do not see the possibility or even probability that an employer would have no employees who would be covered by a proposed agreement when made as requiring a conclusion that it is unreasonable to make a determination in such a case. Of course, depending on the evidence in a particular case, such a circumstance might contribute to a contrary conclusion that making a determination in a particular case is unreasonable. However, we are not persuaded that CBI has demonstrated that the Deputy President’s conclusion as required by s.237(2)(d) is affected by an error within principles laid down in House v King, being the principles applicable to a challenge to a finding of the sort called for by s.237(2)(d).”

[115] I have had regard to the relatively short amount of time between hearing this application, the making of this decision and the proposed final day of employment being 30 June 2019.

[116] Having heard the evidence of EnerMech’s witnesses, it is compelling to determine that in all likelihood, the work will be complete by 30 June 2019, and no employees will be present on the project. There are, of course, no certainties, and the witnesses agreed that there is the potential, albeit improbable, and exceptional circumstances such as severe weather events, that the work could continue beyond 30 June 2019.
[117] I have had regard to all of the matters raised by EnerMech and the concerns it holds as to the utility in bargaining over a period of less than five months, and the resources it would need to divert to bargaining.

[118] Relevant to EnerMech’s submissions on an object of the Act being the making of enterprise agreements delivering productivity benefits, on EnerMech’s own evidence it will or may undertake a review of the 2015 Agreement in order to assess its bargaining position. That is a matter for EnerMech. It is true to say that the current CEPU claim is unlikely to deliver productivity benefits, but that is a matter for the parties in bargaining, and EnerMech has indicated it will or may, in the short time available, consider all of the terms and conditions it pays to employees under the 2015 Agreement against market conditions.

[119] Simply because the CEPU’s current bargaining claim does not propose productivity benefits to EnerMech, I am not persuaded that I should find against it being reasonable in all the circumstances to make the determination.

[120] I accept the submissions of the CEPU that making a determination requires the parties to commence bargaining, and not conclude bargaining by the time the work may cease. Whilst I accept that the practicality of making and having an agreement approved are certainly relevant considerations that need to be weighed with other factors, I am not required to be satisfied that it would be impossible for an agreement to be made and approved before I could find that it is unreasonable in the circumstances to make a determination.

[121] One might wonder what it might take for the Commission to conclude that it is not reasonable in all the circumstances to make the determination? Commissioner Simpson found so in Monadelphous. It is clear that it will depend on the evidence in each particular case.

[122] I disagree with EnerMech’s contention that the CEPU has not acted expeditiously to bargain. The CEPU sought confirmation prior to the expiration of the 2015 Agreement that a new agreement would be made. I note that it took some time for EnerMech to confirm with the CEPU that it had determined that it did not wish to bargain, and did not do so until 19 November 2018.

[123] The CEPU has presented positive evidence and substantive argument as to why it would be reasonable in all of the circumstances to make the determination. For the reasons above, and noting the onus is on the CEPU, I am satisfied that it is reasonable in all the circumstances to make the determination. Section 237(2)(d) of the Act is met.

Conclusion

[124] I am satisfied that a majority of the relevant and current employees who will be covered by the proposed agreement wish to bargain for an enterprise agreement. I am also satisfied that each of ss.237(2)(b), (c) and (d) have been met. Pursuant to s.237(1) I must make a majority support determination which will operate from 24 January 2019.

[125] The determination in this matter is issued separately in [2019] FWC 428.

COMMISSIONER

Appearances:

Mr Joseph Kennedy, Principal, Hall Payne Lawyers, for the Applicant;

Mr Christopher Murdoch, QC, instructed by Mr Martin Osborne, Partner, Norton Rose Fulbright, for the Respondent.

Hearing details:

Brisbane, 21 January 2019;

Darwin (by video-link), 21 January 2019.

Printed by authority of the Commonwealth Government Printer

<PR704024>

 1   Royal District Nursing Service Limited v Health Services Union; and Australian Nursing Federation [2012] FWAFB 1489 at [20], citing with approval Coal and Allied Operations Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Australia and Others (1997) 73 IR 311 at 317; “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Veolia Water Operations Pty Ltd [2015] FWC 2561 at [34].

 2   Re MEAA [2014] FWC 8898 at [88], NUW v Coldunit [2016] FWC 9044 at [11] and AMWU v Top Cut Food Industries [2017] FWC 2798 at [22].

 3   The Australian Workers’ Union v The Austral Brick Co Pty Ltd t/a Austral Bricks[2010] FWA 5819 at [24].

 4   Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Veolia Water Operations Pty Ltd[2015] FWC 2561.

 5   Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU) v Edlyn Foods Pty Ltd[2011] FWA 7928.

 6   Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Monadelphous Engineering Associates Pty Ltd and Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union v Monadelphous Engineering Associates Pty Ltd [2018] FWC 3081.

 7   Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Veolia Water Operations Pty Ltd[2015] FWC 2561 at [13].

 8   [2013] FWC 4267.