e2o Pty Ltd

[2019] FWC 1145

[2019] FWC 1145

FAIR WORK COMMISSION

DECISION

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

e2o Pty Ltd
(AG2018/6230)

DEPUTY PRESIDENT ANDERSON ADELAIDE, 27 FEBRUARY 2019

Application for approval of the e2o Pty Ltd Enterprise Agreement 2018-2022

[1] This decision concerns a request by the Communications Electrical Plumbing Union (CEPU) to be heard in proceedings concerning an application by e2o Pty Ltd for approval of an enterprise agreement. The CEPU was neither a bargaining agent for employees under the agreement nor has members employed by the employer under the agreement.

[2] The relevant facts can be simply stated. On 7 November 2018 a single enterprise agreement was made between e2o Pty Ltd and its employees. Thirty two employees were said to be employed and covered by the agreement at that date. No union was a bargaining agent for employees during negotiation of the agreement. No union is covered by the agreement.

[3] The agreement is known as the e2o Pty Ltd Enterprise Agreement 2018 – 2022 (the 2018 Agreement). An application under section 185 of the Fair Work Act 2009 (FW Act) for its approval was filed on 8 November 2018. The agreement is intended to replace the e2o Pty Ltd Enterprise Agreement 2013 – 2017 (the 2013 Agreement). The 2013 Agreement was approved by the Commission on 11 February 2014 with undertakings. No union is covered by the 2013 Agreement. The application was accompanied by a statutory declaration sworn by an officer of the employer on 8 November 2018.

[4] The CEPU submits that it became aware of the 2018 Agreement when the employer earlier in 2018 filed but withdrew separate proceedings. On 30 November 2018 the National Legal Counsel of the CEPU wrote to the Fair Work Commission (the Commission) seeking copies of the application and its accompanying documents. These were provided on 17 December 2018 1 under cover of an email from a Commission officer which included the following:

“Should the CEPU not be able to establish their status as a bargaining representative for this enterprise agreement or the CEPU is not otherwise permitted by the presiding Member to be heard or to make submissions, you are reminded that the CEPU will not be included in any correspondence including notification of the Member’s intention to determine the application.” 2

[5] By letter dated 15 January 2019 the CEPU advised the Commission that it sought “to be heard with respect to the approval of the e2o Pty Ltd Enterprise Agreement 2018 – 2022. The CEPU seeks to be heard in accordance with the Fair Work Commission powers under section 590 of the FW Act.” 3 The CEPU set out grounds on which it seeks to be heard and identified objections to the agreement’s approval.

[6] The matter was allocated to me for hearing and determination.

[7] On 8 February 2019 I set down for hearing the CEPU’s request to be heard. I directed that the CEPU and the employer file written outlines. Those submissions were received on 13 and 18 February respectively.

[8] On 20 February I conducted a hearing by telephone on the CEPU’s request to be heard. Ms Heffernan of the CEPU appeared as did Mr P Robertson of the Australian Mines and Metals Association for the employer, assisted by Ms E Robertson. Each made oral submissions in support of their written outlines. I reserved my decision.

Consideration

[9] In summary, the CEPU contends that it should be heard for the following reasons:

● The CEPU has constitutional coverage of work that is to be performed by persons who would, if the agreement were approved, be employed under the agreement;

● The scope of the agreement is such that the CEPU “is very likely to have members who will be covered by the agreement at least in the future” 4; and

● The CEPU has concerns that the agreement was not genuinely approved by employees and does not comply with the Better off Overall Test (BOOT) as required by the FW Act and, as such, the Commission would be assisted by a contradictor in determining those issues.

[10] It should be noted that the CEPU does not assert a right to be heard. The CEPU accepts that it “has not identified any CEPU members covered by the Agreement” 5. Rather, the CEPU submits that the Commission should hear from it by exercising discretion under section 590 of the FW Act. Under that section the Commission “may” inform itself “in such manner as it considers appropriate” including by “inviting…oral or written submissions.”

[11] A union seeking to appear in proceedings for approval of an agreement in which it was neither a bargaining agent nor has current membership of persons under the proposed agreement is a matter that has arisen previously before the Commission, and been the subject of full bench consideration 6. The general principle gleaned from past matters is that where a union is not a bargaining representative but has potential representative capacity of employees, the union does not have a right to be heard. Whether such an organisation is heard will be a discretionary matter dependant on the circumstances of each case7.

[12] Thus, a discretionary power exists whereby the CEPU could be permitted by the Commission to appear and make submissions on substantive questions associated with whether the 2018 Agreement should be approved 8.

[13] Are the circumstances in this matter, including the grounds advanced by the CEPU, such that a discretion should be exercised allowing the CEPU to be heard?

[14] The CEPU has constitutional coverage under its rules that cover work that is to be performed by persons who would, if the agreement were approved, be employed under its terms. This establishes direct interest in the industry and occupations covered by its rules, and a lawful right and capability to act in the industrial interests of persons engaged in those industries or occupations. However, in the context of a statutory scheme of enterprise bargaining that includes non-union bargaining 9 and one in which the FW Act does not provide for intervention in proceedings by a non-party10, this factor alone, without more, is not sufficient to warrant discretion being exercised in favour of being heard where a union has no direct or historic connection with bargaining in the relevant enterprise. In this case the absence of more renders this is a neutral consideration. It does not weigh in favour of exercising discretion.

[15] The second ground on which the CEPU relies is the scope of the 2018 Agreement. The CEPU correctly points to the fact that the proposed scope is national in coverage and expressed to cover persons “employed in the classifications contained in the modern awards that fall within the scope of Appendix 1” 11. Appendix 1 identifies six awards including, for example the Electrical Power Industry Award 2010, the Mining Industry Award 2010 and the Manufacturing and Associated Industries and Occupations Award 2010. I am satisfied that the CEPU is an active participant in the making and variation of the terms and conditions of employees in each of the six specified modern awards and exercises a right to be heard with regard to them.

[16] There is a connection between factors which the Commission must be satisfied in deciding whether to approve the 2018 Agreement and the modern awards identified in Appendix 1. For example, under section 186(2)(d) of the FW Act the application of the BOOT involves consideration of each of the six named awards as against the provisions of the 2018 Agreement. Whilst the proposed agreement does not, on its face displace the operation of those awards, it seeks to vary or supplement them. However, under the statutory scheme modern awards are no longer respondency awards. They are made by the Commission under a statutory directive to do so, not as a consequence of settlement of an interstate dispute involving a union 12. Without more, the CEPU’s legitimate interest and role in the making and variation of modern awards is not a sufficient basis to conclude that it should be heard in proceedings for the approval of an agreement simply because the scope of the proposed agreement would include an industry covered by a particular modern award. In the absence of more, this too is a neutral consideration and does not weigh in favour of exercising discretion.

[17] However, the CEPU submit that in the circumstances of this matter the scope of e2o’s 2018 Agreement is of such breadth that the CEPU “is very likely to have members who will be covered by the agreement at least in the future” 13. I am satisfied given the national scope of the proposed agreement and its coverage of one or more modern awards in respect of which the CEPU has an active advocacy and representative role that this is a possibility. However, I have no evidence before me to indicate whether it is “very likely” (as asserted) beyond the ordinary ebb and flow of union membership and employees exercising choice of industrial representation in these industries. It remains a neutral consideration.

[18] The third ground on which the CEPU seek to be heard is that the union holds an actual belief that the proposed agreement does not meet the BOOT test and that the agreement was not genuinely made by employees. It submits that the Commission would be assisted by a contradictor in determining those issues.

[19] The CEPU correctly identifies that the Commission must be satisfied on each of these issues. Each involves an application of law to factual circumstances.

[20] There may be some unique circumstances where a contradictor is of value to the Commission when exercising statutory jurisdiction. However, the Commission is vested with responsibility to apply the law to given facts and has the tools at hand to do so, including power to elicit evidence and submissions from applicants or persons with standing to be heard. It may in particular circumstances be useful but it is not necessary for the Commission to hear from a contradictor to determine whether an agreement does or does not pass the BOOT or was or was not genuinely agreed. However, published Commission decisions illustrate that many agreements have variously been approved or not been approved or been approved only with undertakings, irrespective of whether a contradictor or opposing voice has participated in proceedings.

[21] In the context of proceedings on e2o’s 2018 Agreement, it is not apparent whether any employees or persons with a right to be heard (other than the employer) intend to appear and make a submission. No such notification has yet been provided to the Commission either formally or informally. It is possible (though not necessarily so) that in the absence of a contradictor these proceedings will be conducted with the employer alone appearing. Doing so is not uncommon in dealing with applications under section 185 and should not be considered unusual given that the jurisdiction, on its face, is dealing with agreements between an employer and its employees. Applications for approval of enterprise agreements are neither necessarily disputed nor inherently adversarial matters.

[22] The issues raised by the CEPU in its written submissions are not however marginal matters. They concern issues that must be considered by the Commission. They are however not matters incapable of being raised or considered by the Commission in its own right. Irrespective of whether there is a contradictor the Commission will need to consider both the BOOT and whether genuine agreement (within the meaning of the FW Act) was present. Whether there is substance to the objections remains to be seen.

[23] The case for exercising discretion in favour of the CEPU being heard, beyond that already afforded, is not strong. The grounds relied upon individually or collectively do not persuade me to do so. The CEPU has a legitimate interest in the modern awards that are varied or displaced by the terms of the proposed agreement and, at its highest, may in the future secure membership amongst one or more of the relevant employees working under the agreement should it be approved. The CEPU has not produced evidence that would take its interest in the 2018 Agreement beyond generalised concerns. It currently represents no persons to be covered by the agreement, and has no history of having done so as a bargaining representative (or otherwise) in respect of the current agreement operating between this employer and its employees. It is a single enterprise agreement. It was created in the context of a statutory scheme that provides for agreements being made between an employer and its employees with or without a union being a bargaining representative or covered by such agreements. This is not a case where the CEPU was covered by the 2013 Agreement and seeks to maintain a continuing role based on past or current membership or a past or current bargaining role with employees of this employer.

[24] In these circumstances I am not persuaded to exercise discretion in favour of the CEPU being heard beyond that already provided by way of written and oral submissions. In that respect, it has been provided an opportunity to develop its argument 14, and that argument is before the Commission. Should material circumstances alter, I am willing to entertain a fresh request.

[25] Directions will now be issued in advance of the hearing of this matter.

DEPUTY PRESIDENT

Appearances:

P. Robertson and E. Robertson for e2o Pty Ltd

A. Heffernan for the CEPU

Hearing details:

2019.

Adelaide; by telephone.

20 February.

Printed by authority of the Commonwealth Government Printer

<PR705176>

 1   Applying the principle in Construction, Forestry, Mining and Energy Union v Ron Southon [2016] FWCFB 8413 at [28]

 2   Email Member Assist (Director - Agreements Team) to Alana Heffernan 17 December 2018 1.52pm

 3   Letter Alana Heffernan to FWC Members Assist 15 January 2019 paragraph 3

 4   CEPU Written Submission 13 February 2019 page 2 paragraph 3

 5   Ibid page 2 paragraph 2

 6   See for example Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited[2014] FWCFB 7940 at [48]–[75]; United Voice v Sodexo Australia [2016] FWCFB 8531; Construction, Forestry, Mining and Energy Union v Ron Southon [2016] FWCFB 8413 and Construction, Forestry, Mining and Energy Union v SESLS Industrial Pty Ltd [2017] FWCFB 3659; The Australian Workers’ Union v Oji Foodservice Packaging Solutions (Aus) Pty Ltd [2018] FWCFB 7501

 7   Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited[2014] FWCFB 7940 at [72]

 8   Ibid at [75]

 9   Ibid at [66]

 10   Ibid at [48]

 11   2018 Agreement clause 2.1(b)

 12   Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited[2014] FWCFB 7940 at [55]; see also Fast Food Industry Award 4 Yearly Review [2019] FWCFB 272 at [113] – [114]

 13   CEPU Written Submission 13 February 2019 page 2 paragraph 3

 14   Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited[2014] FWCFB 7940 at [76]