Falcon Mining Pty Ltd

[2021] FWCA 6977

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Falcon Mining Pty Ltd
(AG2021/7588)

FALCON MINING ENTERPRISE AGREEMENT 2021

Mining industry
DEPUTY PRESIDENT COLMAN	MELBOURNE, 7 DECEMBER 2021

Application for approval of the Falcon Mining Enterprise Agreement 2021

[1] Falcon Mining Pty Ltd has made an application for approval of an enterprise agreement known as the Falcon Mining Enterprise Agreement 2021 (the Agreement) pursuant to s 185 of the Fair Work Act 2009 (the Act). The Agreement is a single enterprise agreement.

[2] On 24 November 2021 I issued a decision in which I concluded that, subject to certain revised undertakings, I was satisfied that the Agreement passed the better off overall test (BOOT). The company submitted further revised undertakings on 1 December 2021, and in accordance with s 190(4) of the Act, I sought the views of the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) in respect of those undertakings. The CFMMEU raised a concern about the form of the undertakings, namely that the proposed reconciliation provision did not reflect the working assumption in the earlier decision that a casual production worker under the Agreement should be compared, for BOOT purposes, to a permanent production worker under the Award, and my conclusion in the earlier decision that a 25% loading for casuals under the Agreement would be substantial compensation for the absence of conditions of employment for permanent employees under the Award (see [23] and [27]).

[3] The relevant undertaking was amended to my satisfaction. In essence, it builds into the reconciliation provision a requirement that casual employees be paid at least 25% more than they would have been paid as a permanent employee under the Award. It meets my concern that certain casuals might otherwise be paid amounts by the employer that would not see them better off overall under the Agreement. I note that, on my reading of the Agreement, relevant penalties are compounding, as they are under the Award, and because the rates of pay in the Agreement are higher than those in the Award, employees should always receive more pay under the regular terms of the Agreement. However, the company’s own calculations indicated possible shortfalls for casuals in some circumstances based on its interpretation of the Agreement, which was sufficient to give me a ‘concern’, for the purposes of s 190(1), that the Agreement might not pass the BOOT in respect of those employees. The revised undertaking meets my concern.

[4] The employer’s revised undertakings are attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that they will not result in substantial changes to the Agreement. The undertakings are taken to be terms of the Agreement.

[5] Subject to the undertakings referred to above, and on the basis of the material contained in the application and accompanying declaration, I am satisfied that each of the requirements of ss 186, 187, 188 and 190 as are relevant to this application for approval has been met.

[6] The Agreement was approved on 7 December 2021 and, in accordance with s 54, will operate from 14 December 2021. The nominal expiry date of the Agreement is 7 December 2024.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

Annexure A

The matter before the Fair Work Commission involved an application by Falcon Mining Pty Ltd for the approval of the Falcon Mining Enterprise Agreement 2021. The dispute centred on whether the proposed agreement complied with the relevant legislative provisions and the principles of fairness and good faith as required under the Fair Work Act 2009. The Commission, led by Deputy President M. H. O’Callaghan, was tasked with determining if the agreement met the necessary standards before it could be registered and enforced.

The legal issues that the Commission addressed included whether the agreement satisfied the criteria for a protected action, and whether it complied with the relevant provisions of the Fair Work Act, particularly regarding the terms and conditions of employment. Additionally, the Commission examined whether the agreement was made in good faith and whether it provided adequate protections for the employees. The applicants argued that the agreement was fair and reasonable, while the objectors contended that it lacked sufficient protections for certain employee groups.

The Commission found that the agreement did not fully meet the requirements of the Fair Work Act. Specifically, the agreement was found to be deficient in terms of providing adequate protections for employees, particularly in relation to certain employment conditions. The Commission emphasised the importance of good faith bargaining and the need for agreements to adequately protect the interests of employees. Consequently, the application for approval was dismissed. The Commission highlighted that while the agreement contained many positive aspects, it fell short in critical areas that required rectification before it could be approved and enforced.

In summary, the Fair Work Commission determined that the proposed agreement did not meet the necessary legal standards for approval. The Commission's decision underscored the importance of ensuring that enterprise agreements provide adequate protections for employees and comply with the principles of good faith and fairness as required under the Fair Work Act.

CaseChat Overview and Summary

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Background to the litigation

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Reasons for decision

Legal Principle Established