Costa Logistics Pty Ltd

[2019] FWCA 6446

[2019] FWCA 6446

FAIR WORK COMMISSION

DECISION

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

Costa Logistics Pty Ltd
(AG2019/2778)

COSTA LOGISTICS EASTERN CREEK DISTRIBUTION CENTRE ENTERPRISE AGREEMENT 2019

Storage services
COMMISSIONER HARPER-GREENWELL	MELBOURNE, 16 SEPTEMBER 2019

Application for approval of the Costa Logistics Eastern Creek Distribution Centre Enterprise Agreement 2019.

[1] An application has been made for approval of an enterprise agreement known as the Costa Logistics Eastern Creek Distribution Centre Enterprise Agreement 2019 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by Costa Logistics Pty Ltd (the Applicant). The Agreement is a single enterprise agreement.

[2] I am satisfied that each of the requirements of ss.186 and 187 as are relevant to this application for approval have been met. The Agreement does not cover all of the employees of the employer, however, taking into account the factors in Section 186(3) and (3A) I am satisfied that the group of employees was fairly chosen.

[3] The Notice of Employee Representational Rights (NOERR) issued to employees omitted content that is prescribed by Schedule 2.1 of the Fair Work Regulations, specifically the below paragraph:

“If you are a member of a union that is entitled to represent your industrial interests in relation to the work to be performed under the agreement, your union will be your bargaining representative for the agreement unless you appoint another person as your representative or you revoke the union’s status as your representative.”

[4] I sought submissions from the parties as to how I could be satisfied that the Agreement had been genuinely agreed to in the circumstances, particularly noting the below comments of the Full Bench of the Commission in Huntsman Chemical Company Australia Pty Limited T/A RMAX Rigid Cellular Plastics & Others 1:

“[82] The other examples given relate to various ‘errors’ concerning the NERR requirements. We deal with some of these issues later in the context of the particular matters before us. We note here that there is at least one species of ‘error’ which is unlikely to be classified as a ‘minor error’. The prescribed text of the NERR includes the following:

You have the right to appoint a bargaining representative to represent you in bargaining for the agreement or in a matter before Fair Work Commission about bargaining for the agreement.

You can do this by notifying the person in writing that you appoint that person as your bargaining representative. You can also appoint yourself as a bargaining representative. In either case you must give a copy of the appointment to your employer.

If you are a member of a union that is entitled to represent your industrial interests in relation to the work to be performed under the agreement, your union will be your bargaining representative for the agreement unless you appoint another person as your representative or you revoke the union’s status as your representative.

[83] If these paragraphs are omitted from the NERR provided to the employees then it is unlikely to be construed as a ‘minor error’. These paragraphs may be characterised as core requirements of the NERR, given the policy purpose associated with the provision of the NERR. As the majority observed in Ostwald:

‘[62] The inclusion by the Parliament within the Act of an express requirement upon employers to provide a notice (s.173) and the express requirements as to the content of a notice (s.174) is consistent with the importance of bargaining representation evident in the bargaining process established by the Act. It is also consistent with the objects of the Act and Part 2-4 of the Act in relation to fairness and representation at work, the right to freedom of association, the right to be represented, collective bargaining underpinned by simple good faith bargaining obligations, a simple, flexible and fair framework that enables collective bargaining in good faith and the facilitation of good faith bargaining…

[64] Second, s.174 evinces a clear intention that employees are fully informed as to their right of representation - default representation or to otherwise nominate a bargaining representative - and the means of affecting that right.

[65] Having legislated the default position in relation to bargaining representatives and the appointment of a non-default representative and the means of obtaining such representation (ss.176(1)(b) and (c)) and other matters in relation to bargaining representatives, including the requirement to notify the appointment of a non-default representative (s.178), the provisions in s.173 and s.174 of the Act were clearly intended to serve another purpose. The requirement to give a s.173 notice to relevant employees, in the terms required by s.174, serves a distinct and separate purpose from the giving of rights of representation through s.176. The requirement to give the notice in the required terms is directed to the additional purpose of advising employees of their rights of representation and the means of exercising them in order that they can effectively utilise their right of representation in bargaining and to enhance the process of fair bargaining under the Act.’

[84] We also note that, in relation to the objects of representation in bargaining, the High Court in Aldi Foods Pty Limited v SDA observed in discussing ss.173 and 176 of the Act:

‘38. These provisions serve to ensure that the employees referred to in s 172(2)(a) are able to call upon the negotiating skills and bargaining strength of employee organisations should they so choose in order to minimise the inequalities of bargaining power that might otherwise adversely affect the outcome of their negotiations with their employer.’

[85] We would also observe that in the context of Matter AG2018/6614, ACCI conceded, appropriately, that the omission from the NERR of the paragraph relating to the union’s role in the bargaining process would be unlikely to constitute a minor error:

‘In this application the employer appears to have omitted from the NERR the paragraph relating to the union’s role in the bargaining process.

The purpose of this paragraph is to inform the employee that, if they are a member of a union, their union will be their bargaining representative unless they appoint another person or revoke the union’s status. This is a core requirement of the NERR, prescribed by section 174(3) of the Act.

The purpose of the paragraph is to inform employees that, if they are members of a union, their union will be their default bargaining representative unless they appoint someone else, or revoke the union’s appointment.

On the surface, it would seem unlikely that the failure to include this paragraph could ordinarily constitute a minor error.

Despite this, some further inquiry is warranted as the effect of this error may not have been manifest and the bargaining process may have continued as it would have had the NERR been in the correct form.

For instance it is not inconceivable that the employer had spoken with each of the eight employees and ascertained that none were members of a union. As the Full Bench confirmed in Peabody Moorvale Pty Ltd v Construction, Forestry, Mining and Energy Union (CFMEU), the purpose of the section is to “set out the default position for union members” (emphasis added).’

[86] We agree with the submission put.” (endnotes omitted)

[5] The Applicant submitted that the error was minor or technical in nature and that employees were not likely to have been disadvantaged by the error. They submitted that of the 14 employees to be covered by the Agreement, 12 had been employed during the negotiations for the previous enterprise agreements conducted in 2011, 2014 and 2016. Further, of the 14 employees, 10 were members of the National Union of Workers (NUW) during the bargaining process.

[6] The Applicant submitted that on 20 February 2019, the employees and employer had a meeting to discuss the bargaining process and the employees nominated two employees to act as representatives for staff. All bargaining meetings were then held with the two bargaining representatives and an organiser from the NUW.

[7] The Applicant submitted that the omission of the paragraph in the NOERR did not impact on the course of bargaining, and that the bargaining process would have continued as it did if the omission had not occurred.

[8] They submitted that omission of the paragraph is a minor technical error in circumstances where the bargaining process included two representatives nominated by employees, a union official was present at all meetings and separately met with the representatives and employees in the employer’s absence, and the employees were experienced with bargaining under the Act having undertaken the process three times previously.

[9] The NUW submitted that they supported the submissions made by the Applicant in relation to s.188(2) of the Act. They further submitted that as a bargaining representative they supported the approval of the Agreement by the Commission.

[10] Taking into consideration the observations of the Full Bench in Huntsman Chemical Company Australia Pty Limited T/A RMAX Rigid Cellular Plastics & Others 2 that the purpose of paragraph that was omitted is to set out the default position for union members, and having regard to the content of the statutory declaration and the submissions of the Applicant and the NUW, I am satisfied that all 14 employees were provided with an opportunity to elect a bargaining representative of their choice. I am satisfied that the employees covered by the agreement were not likely to have been disadvantaged by the omission of the paragraph that sets out the default position for union members from the NOERR. In the circumstances, I am satisfied that the issuing of the erroneous NOERR constitutes a minor technical error for the purposes of s.188(2)(a) of the Act. Further, as a result, I am satisfied that the Agreement has been genuinely agreed within the meaning of s.188(2) of the Act.

[11] The Agreement lodged contained an error at clause 43.4. On 3 September 2019, the Applicant filed an amended version of the Agreement correcting this error. I am satisfied that the correction should be made and that it is appropriate to do so pursuant to s.586 of the Act.

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

[13] The Agreement was approved on 16 September 2019 and, in accordance with s.54, will operate from 23 September 2019. The nominal expiry date of the Agreement is 17 June 2022.

COMMISSIONER

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 1   [2019] FWCFB 318

 2   Ibid.