Directhaul Pty Ltd

[2016] FWCA 6311

[2016] FWCA 6311

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Directhaul Pty Ltd
(AG2016/4309)

PUMA ENERGY TRANSPORT AGREEMENT 2016

Oil and gas industry
COMMISSIONER SIMPSON	BRISBANE, 5 OCTOBER 2016

Application for approval of the Puma Energy Transport Agreement 2016.

[1] On 18 August 2016 Directhaul Pty Ltd (“the Applicant”) made an application for approval of an enterprise agreement known as the Puma Energy Transport Agreement 2016 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act).

[2] The agreement is a single-enterprise agreement.

[3] On 23 August 2016, the Transport Workers’ Union of Australia (TWU) filed a Form F18 indicating that while the TWU supported approval of the Agreement it disagreed with a number of answers given to questions in the statutory declaration filed with the application.

[4] Given the range of issues identified by the TWU, I listed the matter for hearing on 1 September 2016. The Applicant sought permission to be represented by a lawyer in accordance with s.596 and this was granted. At the commencement of the hearing the parties agreed to adjourn into conference to discuss the matters of concern.

[5] Flowing from those discussions, and on resumption of the hearing, the Applicant advised it would consider offering a number of undertakings to the Fair Work Commission (the Commission) in order to address the issues raised by the TWU.

[6] I issued directions for the Applicant to provide draft undertakings by Monday 5 September 2016, for the TWU to provide submissions in relation to any outstanding issues by Tuesday 9 September 2016, and for the Applicant to provide any reply submissions by Monday 12 September 2016.

[7] The Applicant filed draft undertakings on 5 September 2016. On 8 September 2016 the TWU sent correspondence to the Commission indicating that it supported the draft undertakings provided by the Applicant.

[8] The TWU continued however to maintain a remaining concern with respect to Clause 4.2 (c) of the Agreement. Clause 4.2(c) reads as follows:

“(c) Salaries and wages and any increase, is highly confidential and an Employee is prohibited from discussing all aspects of salaries or increases with anyone else at work except their Manager (this includes asking a fellow Employee if they receive an increase). An Employee who breaches this clause will be disciplined. This excludes publicly listed rates.”

[9] The TWU submitted that Clause 4.2 (c) should be the subject of a further undertaking. The TWU submitted that disciplinary action could constitute adverse action for the purposes of the general protections provisions under the Act.

[10] The TWU submitted that employees may wish to discuss their terms and conditions with other employees (including for example a union delegate). The TWU submitted that in the context of bargaining or alternatively seeking compliance with the Agreement, these things could be exercising a workplace right and therefore the provision could be construed as undermining the general protections provisions of the Act. It was also argued that prohibiting discussion of their terms and conditions of employment could undermine collective bargaining.

[11] One of the draft undertakings offered by the Applicant on 5 September 2016 read as follows:

“The Employer will not seek a pecuniary penalty under section 546(1) of the Act against an employee who breaches clause 4.2(c) (Remuneration) of the Agreement.”

[12] The TWU said that it supported the undertaking proposed in respect of Clause 4.2 (c) however requested that the Commission consider whether a further undertaking may be required in light of its concerns.

[13] The Applicant submitted that the TWU submissions only appeared to engage the questions of firstly, whether the clause constitutes an unlawful term, and secondly, whether the clause impacts the better off overall test (BOOT) test.

[14] The Applicant submitted that the clause is not an unlawful term because it does not require or permit a contravention of the general protections provisions of the Act. The Applicant submitted the term must do more than ‘afford the possibility’ of a contravention – it must authorise the contravention.

[15] The Applicant referred to the decisions in Australian Industry Group v Fair Work Australia 1; Klein v Metropolitan Fire and Emergency Services Board2and Marmara v Toyota Corporation.3The Applicant submitted that to the extent that the clause can be properly given a narrow construction to avoid the term being objectionable, the Commission has considered that it should do so.4

[16] The Applicant emphasised that the clause prohibits discussing salaries and increases with anyone except their manager (save that the prohibition does not apply to publicly listed rates – such as those set out in the Agreement).
[17] The Applicant said it had already proposed the undertaking not to seek pecuniary penalties, and in the context, it is clear the clause only operates in respect of any ‘above – agreement’ salaries or wages, and therefore will not prohibit discussion of Agreement salaries and wages in the context of enterprise bargaining, or from seeking advice on compliance.

[18] I accept the Applicant’s submissions that because the clause does not seek to prohibit the discussion of the salaries, wages or conditions described in the Agreement itself, it does not require or permit a contravention. The exclusion from the operation of the clause of wages and conditions contained in the Agreement makes clear the clause is directed to over agreement contractual arrangements.

[19] The Applicant relied on the decision of the Full Federal Court in Marmara v Toyota Coproration 5 in support of its contention that the question as to whether or not disciplinary action taken by it against an employee amounts to a breach of the general protections provisions depends on the reason for imposing the disciplinary action, and this is an assessment that can only be made on a case by case basis. The Applicant provided the example of circumstances where the reason for disciplinary action being taken was because the disclosure caused a fellow employee to feel undervalued, and such a decision would not be a contravention. I accept the Applicant’s submissions as a correct application of the principle referred to in the decision in Marmara v Toyota.

[20] On the matter of the BOOT, the Applicant made submissions to the effect that the clause facilitates an employee benefit higher than the rates described in the Agreement, or the Award that would otherwise apply.

[21] The Applicant submitted that while the modern award does not contain confidentiality provisions such as clause 4.2(c), it does not need to because it only contains publicly available rates, and does not make provision for higher rates. Clause 4.2(c) it is said imposes conditions on higher rates that do not appear in, and are more favourable than the relevant modern award, and accordingly no matter how onerous the conditions, they cannot negatively impact the BOOT.

[22] The Applicant also submitted that in any event, the more favourable elements of the Agreement as compared with the relevant modern award more than compensate for the confidentiality obligation.

[23] The Applicant referred to a number of Fair Work Commission decisions where the impact of confidential information provisions on the BOOT has been considered. I have had regard to the authorities referred to by the Applicant and am satisfied that, when consideration is also given to the draft undertaking offered concerning clause 4.2(c), that the inclusion of the clause when considered overall in the context of other beneficial conditions in the Agreement does not cause the Agreement to fail the BOOT.

[24] It is a requirement of s.190(4) that the Commission must not accept an undertaking under subsection (3), unless the Commission has sought the views of each person the Commission knows is a bargaining representative for the Agreement. 

[25] On 15 September 2016 I directed the Applicant to provide a copy of the draft undertakings provided to the Commission to each of the remaining bargaining representatives by 19 September 2016.

[26] I also directed the Applicant to advise each of the remaining bargaining representatives that if they wished to express a view to the Commission about the draft undertakings, they may do so by 23 September 2016. 

[27] On 19 September 2016, the Applicant confirmed it had provided by email a copy of the draft undertakings previously provided to the Commission to each of the remaining bargaining representatives and advised each of the remaining bargaining representatives, in writing by email, of the deadline to express a view to the Commission about the draft undertakings.

[28] On 19 September 2016, the Applicant also attached a signed copy of the undertakings.

[29] As at 23 September 2016, the Commission had not received correspondence from any of the remaining bargaining representatives expressing their view about the draft undertakings.

[30] Pursuant to s.190 of the Act, I accept the Company’s undertakings. A copy of the undertakings is attached to the Agreement and forms part of the Agreement.

[31] I am satisfied that each of the requirements of ss186, 187 and 188 as are relevant to this application for approval have been met.

[32] The TWU 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) of the Act, I note that the Agreement covers this organisation.

[33] The Agreement is approved and will operate in accordance with s.54 of the Act.

COMMISSIONER

 1 [2012] FCAFC 108 at [66].

 2 [2012] FCA 1402 at [221].

 3 [2014] FCAFC 84 at [128].

 4   Country Fire Authority v United Firefighers’ Union of Australia[2013] FWC 75-09 at [33].

 5 [2014] FCAFC 84 at [128].

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