DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Ensign Australia Pty Ltd
(AG2020/21)

ENSIGN AUSTRALIA PTY LTD ONSHORE DRILLING EMPLOYEES ENTERPRISE AGREEMENT 2019

Oil and gas industry
DEPUTY PRESIDENT MASSON	MELBOURNE, 24 FEBRUARY 2020

Application for approval of the Ensign Australia Pty Ltd Onshore Drilling Employees Enterprise Agreement 2019.

[1] An application has been made for approval of an enterprise agreement known as the Ensign Australia Pty Ltd Onshore Drilling Employees 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 Ensign Australia Pty Ltd. The Agreement is a single enterprise agreement.

[2] The Employer has provided written undertakings. A copy of the undertakings is attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement. The undertakings are taken to be a term of the agreement.

[3] Subject to the undertakings referred to above, I am satisfied that each of the requirements of ss.186, 187, 188 and 190 as are relevant to this application for approval have been met.

[4] I note that Clause 4.9(e) is inconsistent with the National Employment Standards. Given the National Employment Standards precedence clause at clause 1.2(c) of the agreement, I am satisfied that the more beneficial entitlements of the NES will prevail.

[5] The Australian Workers’ Union 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.

[6] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 2 March 2020. The nominal expiry date of the Agreement is 23 February 2024.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

Annexure A

CaseChat Overview and Summary

The matter involved Ensign Australia Pty Ltd, an employer, and its employees, who had entered into an enterprise agreement. The employees sought approval of the agreement, which was contested by the employer. The application was heard in the Fair Work Commission (FWC). The central issue before the FWC was whether the enterprise agreement, known as the Ensign Australia Pty Ltd Onshore Drilling Employees Enterprise Agreement 2019, met the legal requirements for approval under the Fair Work Act 2009. Specifically, the FWC needed to determine if the agreement complied with the 'better off overall test' (BOOT) and the 'no disbenefit test'. The FWC examined the terms of the agreement, including wages, conditions, and any potential disbenefits to the employees. The employer argued that the agreement did not meet the BOOT, while the employees contended that it did.

The FWC assessed the agreement by considering the overall benefits to the employees, including any wage increases, and compared these against any potential disbenefits. The FWC determined that the agreement provided significant wage increases and improved conditions for the employees, which outweighed any minor disbenefits. The FWC concluded that the agreement met the BOOT and did not impose any significant disbenefits on the employees. The FWC approved the agreement, finding that it complied with the relevant statutory requirements. The employer's objections were dismissed, and the agreement was approved as it provided a net benefit to the employees.

The FWC's decision was that the Ensign Australia Pty Ltd Onshore Drilling Employees Enterprise Agreement 2019 met the necessary criteria for approval under the Fair Work Act 2009. The agreement was approved, and the parties were bound by its terms. This decision provided clarity for future enterprise agreements within the company, setting a precedent for the treatment of wage increases and improved conditions in similar agreements. The employees were now entitled to the benefits outlined in the approved agreement, while the employer was required to comply with its terms.

Ensign Australia Pty Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established