Direct Solutions (Australia) Pty Ltd T/A Engineering Directions

[2014] FWC 8993

[2014] FWC 8993

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Direct Solutions (Australia) Pty Ltd T/A Engineering Directions
(AG2014/10723)

Manufacturing and associated industries
COMMISSIONER RYAN	MELBOURNE, 15 DECEMBER 2014

Application for approval of the Engineering Directions P/L Enterprise Bargaining Agreement 2014 - 2019.

[1] An application has been made by Direct Solutions (Australia) Pty Ltd T/A Engineering Directions for approval of the Engineering Directions P/L Enterprise Bargaining Agreement 2014 - 2019 (Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single-enterprise agreement.

[2] Section 185 of the Act provides that:

“185 Bargaining representative must apply for the FWC’s approval of an enterprise agreement

Application for approval

(1) If an enterprise agreement is made, a bargaining representative for the agreement must apply to the FWC for approval of the agreement.

(1A) Despite subsection (1), if the agreement is a greenfields agreement, the application must be made by:

(a) an employer covered by the agreement; or
(b) a relevant employee organisation that is covered by the agreement.

Material to accompany the application
(2) The application must be accompanied by:

(a) a signed copy of the agreement; and
(b) any declarations that are required by the procedural rules to accompany the application.

When the application must be made
(3) If the agreement is not a greenfields agreement, the application must be made:

(a) within 14 days after the agreement is made; or
(b) if in all the circumstances the FWC considers it fair to extend that period—within such further period as the FWC allows.

(4) If the agreement is a greenfields agreement, the application must be made within 14 days after the agreement is made.
Signature requirements

(5) The regulations may prescribe requirements relating to the signing of enterprise agreements.” (underlining added)

[3] Regulation 2.06A of the Fair Work Regulations prescribes the requirements relating to the signing of enterprise agreements. Specifically, the Regulation 2.06A states:

“Division 4—Approval of enterprise agreements

2.06A Bargaining representative must apply for FWC approval of an enterprise agreement—requirements for signing agreement

(1) For subsection 185(5) of the Act, this regulation prescribes the requirements for the signing of an enterprise agreement.

(2) For paragraph 185(2)(a) of the Act, a copy of an enterprise agreement is a signed copy only if:

(a) it is signed by:

(i) the employer covered by the agreement; and
(ii) at least 1 representative of the employees covered by the agreement; and

(b) it includes:

(i) the full name and address of each person who signs the agreement; and
(ii) an explanation of the person’s authority to sign the agreement.

Note: Paragraph 185(2)(a) of the Act requires an application for approval of an enterprise agreement to be accompanied by a signed copy of the agreement.” (underlining added)

[4] The signed agreement attached to the application did not meet the requirements of s.185(2)(a) of the Act as it did not include an address of each of the employer and employee representatives who signed the agreement as required by Regulation 2.06A.

[5] As the requirements of s.185(2)(b) have not been complied with the application is not a valid application. The application is therefore dismissed.

Observations

[6] I make the following observations as to the contents of the Agreement. These observations are not part of the decision to dismiss the application in this matter but are made to assist the parties if they wish to make an enterprise agreement and seek to have it approved by the Commission. The problems identified below are many and varied but significantly the Agreement does not contain any wage rates and does not identify a reference instrument for the purposes of conducting a Better Off Overall Test (BOOT). Those two factors alone would prevent proper consideration of this Agreement without further additional material having to be filed by the employer.

[7] For the purposes of my observations below, where I refer to the Modern Award, I mean the Manufacturing and Associated Industries and Occupations Award 2010.

[8] The title page of the Agreement states that the Agreement is a “Certified Agreement entered into pursuant to S170LK of the Workplace Relations Act 1996”. Given that the Workplace Relations Act 1996 is repealed and has been replaced by the Fair Work Act 2009, I am unsure why this is being referred to.

[9] Clause 2 refers to a probation period of 6 months “as per WorkChoices”. Given that WorkChoices legislation is also repealed, I am unsure why this is being referred to.

[10] Clause 3 is titled “Relationship to Workplace Relations Act 1996” but contains no provisions and refers to a repealed Act.

[11] Clause 4 refers to the “Act” as being a reference to the “Workplace Relations Act 1996”. Once again a reference to repealed legislation.

[12] Clause 5 provides for the operation of the Agreement as being the date of certification by the Australian Industrial Relations Commission. Given that the AIRC is a defunct body, on the face of it, this clause would act so that the Agreement would never operate.

[13] Clause 5A states that the Agreement being binding upon employees engaged in any of the occupations, industries or callings specified in “the Award”, but does not specify the name of the Award.

[14] Clause 8 contains a provision regarding review of performance standards which gives the company absolute veto on determining the application of work area performance indications and how improvements to performance are to be achieved. This is a BOOT issue.

[15] Clause 12 relates to casual employees. This clause does not include some of the protections offered by the Modern Award, such as a minimum engagement period and a casual conversion provision. In addition it provides for a 20% loading as opposed to 25% provided for in the Modern Award. This is a BOOT issue.

[16] Clause 15 refers to the classifications and rates of pay as per “the Award”, but does not identify the Award. This problem goes to the issue of the Commission not being able to properly assess the Agreement against the BOOT.

[17] Clause 16 provides for pay increases in percentages over 6 years, however because of the deficiency identified in [15] above, those increases cannot be assessed.

[18] Clause 17 provides for higher duties to be paid only after working at least 2 days at a higher classification structure, which is a lesser entitlement than provided for by the Modern Award which provides at clause 24.2:

“An employee engaged for more than two hours during one day or shift on duties carrying a higher minimum wage than their ordinary classification must be paid the higher minimum wage for such day or shift. If engaged for two hours or less during one day or shift, they must be paid the higher minimum wage for the time so worked.”

This is a BOOT issue.

[19] Clause 18 contains a series of provisions relating to hours of work. It permits for an average of 38 hours per week Monday to Friday, but does not specify the averaging period. It permits for those hours to be worked on days other than Monday to Friday. It permits for a change in the spread of hours of 2 hours outside the spread, whereas the Modern Award only provides for altering the spread of hours 1 hour either side of the spread. And it further permits unspecified changes which may be agreed via the Consultative Committee.

[20] The combined effect of all of those provisions provides little certainty as to what hours employees will actually be working and therefore it would be impossible to make a proper assessment of this clause for BOOT purposes.

[21] Clause 22 provides that employees are entitled to public holidays in accordance with the Public Holidays Test Case decision and lists the days which employees are entitled to as a public holiday. The problem is that the entitlement to public holidays is covered by the National Employment Standards (NES) and the NES includes a provision for additional days which may be any other day, or part-day, declared by or under a law. Therefore, this clause excludes a provision of the NES.

[22] Clause 24 makes reference to repealed legislation.

[23] Clause 26 makes reference to repealed legislation.

[24] Clause 27 makes reference in the dispute settlement procedure to a “Code and Guidelines” but does not identify what that is.

[25] The Agreement does not contain a consultation term which meets the requirements of s.205(1) and (1A) of the Act.

[26] Clause 28 states that the Agreement shall continue until replaced by another agreement. The problem with this is that it does not allow for the Agreement to be terminated pursuant to Part 2-4 of the Act.

[27] Clause 34 makes reference to repealed legislation

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