Fourth Furlong Motel
[2011] FWA 3256
•24 MAY 2011
[2011] FWA 3256 |
|
DECISION |
Fair Work Act 2009
s.185—Enterprise agreement
Fourth Furlong Motel
(AG2011/7131)
COMMISSIONER GOOLEY | MELBOURNE, 24 MAY 2011 |
Fourth Furlong Motel Enterprise Agreement 2011.
[1] Mr Roger Hayes and Ms Anthea Hayes trading as Fourth Furlong Motel (the Applicant) applied on 7 March 2011 pursuant to section 185 of the Fair Work Act 2009 (FW Act) for approval of a single enterprise agreement (the Agreement).
[2] The employer operates a small motel in Cranbourne Victoria and employs a permanent motel manager and casual cleaners.
[3] The Agreement was made with Ms Wendy Carlile the Motel Manager and the Agreement applied to employees employed by the employer in the job classification set out in the Schedule to the Agreement. The only job classification in the Agreement was motel manager.
[4] The employer employed cleaners but the Agreement did not apply to them.
[5] The application was listed for hearing on 20 April 2011 and on 15 April 2011 submissions in support of the Agreement’s approval were provided to chambers.
[6] Mr Chao Ni a legal practitioner appeared for the Applicant. At the hearing I put to the Applicant that I had formed the preliminary view that enterprise agreements could not be made with a single employee.
[7] Mr Ni relied upon the submissions filed to support the application for approval. Further submissions were filed by the Applicant on 21 April 2011.
The submissions of the Applicant
[8] The Applicant submitted that an enterprise agreement could be approved that covered a single employee and was voted for by one employee.
[9] The Applicant submitted that Explanatory Memorandum provides that the FW Act “promotes productivity and fairness through enterprise agreements that are tailored to suit the needs of businesses and the needs of employees.” 1
[10] It was submitted that this Agreement is tailored to meet the needs of the business and the needs of the employee and while the Agreement only covers one job classification it is capable of covering more than one person as one motel manager is replaced by another. 2
[11] It was submitted that the group of employees to be covered by the agreement was fairly chosen as casual cleaners are organisationally and operationally distinct from the job classification of a motel manager. 3
[12] Further it was submitted that a majority of employees cast a valid vote in favour of the Agreement as a single vote in favour represents a unanimous vote and therefore satisfies the requirements for a majority vote. 4
[13] The Applicant distinguished the decision of Commissioner Hampton in Delcorp (SA) Pty Ltd 5 where it was said “a process whereby [an] endorsement is made by a single employee on behalf of a group of employees who are yet to be employed must be carefully considered.”6
[14] It was submitted that in Delcorp the agreement was voted on by a single employee to cover other classifications in which no employees were employed at the time of voting.
[15] The Applicant also distinguished the decision of Deputy President Sams in Lowday Enterprises Pty Ltd 7 where the agreement was voted on by one employee to cover other employees in the same classification who abstained from voting.
[16] The Applicant also distinguished the decision of Commissioner McKenna in Melbourne Nursing Agency Pty Ltd 8 where two part time clerical employees voted for an enterprise agreement which covered full time clerical employees and patient services trainees who were yet to be employed.
[17] In its submissions filed on 21 April 2011 the Applicant relied upon section 23(b) of the Acts Interpretation Act 1901 to support its contention that an enterprise agreement can be made with a single employee. The Applicant submitted that the use of the work “collective bargaining” in section 171 of the FW Act does not in itself represent a contrary intention so as to displace section 23(b) of the Acts Interpretation Act 1901. 9 In support of its contention that an agreement can be made with a single employee it pointed to section 176 of the FW Act which permits an employee to appoint him or herself as his or her own bargaining representative and does not require more than one bargaining representative. The Applicant submitted that “it logically follows that “collective bargaining can take place between an employer and an employee.”
[18] In support of its contention the Applicant relied upon the decision of Commissioner Hoffman in National Transport Operations Pty Ltd 10 in which Commissioner Hoffman found that a section 170LK agreement could be made with one employee.11
The statutory framework
[19] Section 23 of the Acts Interpretation Act 1901 provides as follows:
“In any Act, unless the contrary intention appears:
(b) words in the singular number include the plural and words in plural number include the singular.”
[20] The Privy Council in Blue Metals Industries v Dilbley 12 in applying section 21 of the Acts Interpretation Act 1899 (NSW) (which is relevantly identical), said:
“Words in the singular will include the plural unless the contrary intention appears. But in considering whether a contrary intention appears there need be no confinement of attention to anyone particular section of an Act. It must be appropriate to consider the section in its setting in the legislation and furthermore to consider the substance and tenor of the legislation as a whole.”
Is there a contrary intention in the FW Act which means that an enterprise agreement cannot be made with a single employee?
The Legislative Framework
[21] Part 2-4 of the FW Act provides for the making of enterprise agreements.
[22] Section 171 sets out the objects of Part 2-4 as follows:
“The objects of this Part are:
(a) to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and
(b) to enable FWA to facilitate good faith bargaining and the making of enterprise agreements, including through:
(i) makingbargaining orders; and
(ii) dealing with disputes where the bargaining representatives request assistance; and
(iii) ensuring that applications to FWA for approval of enterprise agreements are dealt with without delay.”
[23] Subsection 172(1) of the FW Act provides for the making of enterprise agreements as follows:
“(1) An agreement (anenterprise agreement) that is about one or more of the following matters (the permitted matters) may be made in accordance with this Part:
(a) matters pertaining to the relationship between an employer that will be covered by the agreement and that employer’s employees who will be covered by the agreement;
(b) matters pertaining to the relationship between the employer or employers, and the employee organisation or employee organisations, that will be covered by the agreement;
(c) deductions from wages for any purpose authorised by an employee who will be covered by the agreement;
(d) how the agreement will operate.”
[24] In this matter the Agreement is a single enterprise agreement and subsection 172 (2) provides for single enterprise agreements as follows:
“(2) An employer, or 2 or more employers that are single interest employers, may make an enterprise agreement (a single-enterprise agreement):
(a) with the employees who are employed at the time the agreement is made and who will be covered by the agreement; or
(b) with one or more relevant employee organisations if:
(i) the agreement relates to a genuine new enterprise that the employer or employers are establishing or propose to establish; and
(ii) the employer or employers have not employed any of the persons who will be necessary for the normal conduct of that enterprise and will be covered by the agreement.
Note: The expression genuine new enterpriseincludes a genuine new business, activity, project or undertaking (see the definition of enterprise in section 12).”
[25] Section 182 provides for when an enterprise agreement is made as follows:
“Single-enterprise agreement that is not a greenfields agreement
(1) If the employees of the employer, or each employer, that will be covered by a proposed single-enterprise agreement that is not a greenfields agreement have been asked to approve the agreement under subsection 181(1), the agreement is made when a majority of those employees who cast a valid vote approve the agreement.”
[26] In approving an enterprise agreement section 186 requires amongst other matters that the following requirements be met:
“(3) FWA must be satisfied that the group of employees covered by the agreement was fairly chosen.
(3A) If the agreement does not cover all of the employees of the employer or employers covered by the agreement, FWA must, in deciding whether the group of employees covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.”
[27] An examination of Part 2-4 shows that Parliament has deliberately used the singular where it is intended that the provision applies to one employee and the plural when it refers to more than one employee.
[28] For example when the FW Act defines permitted matters at section 172 in paragraphs 172(1) (a) and (b) it uses the word employees but in paragraph 172(1)(c) it uses the word employee. When the FW Act provides for the giving of a notice of representational rights in subsection 173(1) it refers to each employee (see also subsections 173(4), and (3), 176(1) and (4)). Further in applying the better off overall test at section 193 it makes reference to each award covered employee.
[29] The use of the term collective bargaining in subsection 171(a) supports a conclusion that the FW Act does not provide for enterprise agreements to be made with one employee.
[30] Collective bargaining is not defined in the FW Act. However subsection 3(a) of the FW Act provides that one of the objects of the Act is:
“Providing workplace relations laws that are fair to working Australians, are flexible for businesses, promote productivity and economic growth for Australia’s future economic prosperity and take into account Australia’s international labour obligations.”
[31] The International Labour Organisation says this of collective bargaining:
“Collective bargaining serves a dual purpose. It provides a means of determining the wages and conditions of work applying to the group of workers covered by the ensuing agreement through free and voluntary negotiations between the two independent parties concerned. It also enables employers and workers to define by agreement the rules governing their relationship. These two aspects of the bargaining process are closely interrelated. Collective bargaining takes place between an employer, a group of employers or one or more employers’ organisations on the one hand and one or more workers’ organisations on the other. It may take place at many different levels, with one level sometimes complementing the other: a unit within an enterprise, enterprise level, sectoral, regional and national level.” 13
[32] It is clear from this, that negotiations between a single employee and his or her employer is not collective bargaining.
[33] Subsections 186(3) and (3A) provide that when considering the approval of an enterprise agreement, Fair Work Australia must be satisfied that the “group” of employees to be covered by the enterprise agreement was fairly chosen. This is strongly supportive of the conclusion that the enterprise agreement must cover more than one employee.
[34] The word “group” is defined by the Macquarie Concise Dictionary as:
“1. any assemblage of persons or things; cluster; aggregation.
2.a number of persons or things ranged or considered together as being related in some way.”
[35] Clearly a group denotes more than one employee.
[36] Further support for the conclusion that an enterprise agreement cannot be made with a single employee can be found in the Explanatory Memorandum.
[37] The Explanatory Memorandum provides as follows:
“Enterprise agreements are collective agreements that will cover a group of employees” (my emphasis) 14.
[38] The Explanatory Memorandum further provides that “a proposed agreement can be an idea, or it can be a series of claims on behalf of a group of employees (my emphasis) whose bargaining representatives seek to negotiate with the employer.” 15
[39] The Explanatory Memorandum provides that “single enterprise agreements are made between a single employer, or two or more employers that are single interest employers, and a group of employees” 16 (my emphasis).
[40] The Applicant relied on the decision of Commissioner Hoffman. 17 This decision was overturned on appeal but the Full Bench did not address the issue of whether an agreement could be made with one employee. The Full Bench said:
“[48] We have decided that we will not deal with the argument of the TWU that the variation, adding as it did several new respondents to the Agreement, is not one that can be made nor approved consistent with the provisions of 170MD of the Act. We have also not found it necessary to comment upon the validity of the original vote for the Agreement as presented for certification, being taken as it was by one employee, nor the fact the votes about the variations were of contract carriers, and employees of both the original employer party, National Transport and of the related corporations.” 18
[41] I respectfully disagree with the conclusion of Commissioner Hoffman but in any event his decision concerned agreements made under a different statutory framework and has no relevance to this decision.
[42] There are no decisions of Fair Work Australia directly on point. Deputy President Sams in Lowday 19 was considering the circumstances where only one employee had voted when there were other employees who would be covered by the enterprise agreement who had not voted. Deputy President Sams said:
“[7] I have grave doubts an Agreement voted on by a single employee and which purports to cover another 10 employees, could be said to have been ‘genuinely agreed to by the employees covered by the agreement’. This is putting aside the strict literal interpretation of s186(2) that by the use of the plural ‘by the employees’ it is unlikely that an enterprise agreement could cover only one employee; let alone be voted upon by one employee to cover many other employees.
[8] I am fortified to this conclusion by reference to the provisions of the Act dealing with majority support determinations and scope orders in respect to proposed single enterprise agreements (s 236-239). No reference is had to the singular ‘employee’. Given this, there does not appear to be to be any legislative intention that majority support determinations or scope orders would be able to be made involving one employee.” 20
[43] Commissioner Hampton in Delcorp 21 was considering an enterprise agreement where one employee who “was not employed as part of the group of employees in the enterprise concerned” voted 22 That is not the case here. Here the employee was employed in the enterprise the subject of the Agreement.
[44] Commissioner McKenna in Melbourne Nursing Agency Pty Ltd 23 was not satisfied that the group of employees was fairly chosen when an agreement was approved by clerical employees which was also to apply to patient services employees. This is not the situation here.
[45] The Applicant contends that because an employee can appoint her or himself as a bargaining representative an enterprise agreement can be made with a single employee. I do not accept this submission. That an individual employee may appoint him or herself or someone else as a bargaining representative does not support a conclusion that an agreement can be made with a single employee. Enterprise agreements are not made with bargaining representatives but with employees. It does not logically follow that because an employee can appoint a bargaining representative that an enterprise agreement may be made with a single employee.
[46] Further support for the conclusion that the FW Act did not intend that enterprise agreements can be made with a single employee can be discerned by the context in which the FW Act was enacted.
[47] Parliament, when it enacted the FW Act, repealed legislation which permitted an employer to make a statutory agreement with a single employee. Prior to the enactment of the FW Act the legislation permitted an employer to make an agreement with an employee namely an Individual Transitional Employment Agreement and prior to that an Australian Workplace Agreement. If Parliament had intended that an enterprise agreement could be made with a single employee it would have made this explicit.
[48] Further the FW Act does allow an employer to make an individual agreement with a single employee by providing that modern awards and enterprise agreements include flexibility terms.
[49] Section 144 of the FW Act provides as follows:
“Flexibility terms must be included
(1) A modern award must include a term (a flexibility term) enabling an employee and his or her employer to agree on an arrangement (an individual flexibility arrangement) varying the effect of the award in relation to the employee and the employer, in order to meet the genuine needs of the employee and employer.
Effect of individual flexibility arrangements
(2) If an employee and employer agree to an individual flexibility arrangement under a flexibility term in a modern award:
(a) the modern award has effect in relation to the employee and the employer as if it were varied by the flexibility arrangement; and
(b) the arrangement is taken, for the purposes of this Act, to be a term of the modern award.
(3) To avoid doubt, the individual flexibility arrangement does not change the effect the modern award has in relation to the employer and any other employee.
Requirements for flexibility terms
(4) The flexibility term must:
(a) identify the terms of the modern award the effect of which may be varied by an individual flexibility arrangement; and
(b) require that the employee and the employer genuinely agree to any individual flexibility arrangement; and
(c) require the employer to ensure that any individual flexibility arrangement must result in the employee being better off overall than the employee would have been if no individual flexibility arrangement were agreed to; and
(d) set out how any flexibility arrangement may be terminated by the employee or the employer; and
(e) require the employer to ensure that any individual flexibility arrangement must be in writing and signed:
(i) in all cases—by the employee and the employer; and
(ii) if the employee is under 18—by a parent or guardian of the employee; and
(f) require the employer to ensure that a copy of any individual flexibility arrangement must be given to the employee.
(5) Except as required by subparagraph (4)(e)(ii), the flexibility term must not require that any individual flexibility arrangement agreed to by an employer and employee under the term must be approved, or consented to, by another person.”
[50] It is clear that this is the mechanism that Parliament intended an employer and an individual employee use to make an agreement which applies to a single employee.
Conclusion
[51] I have concluded that an enterprise agreement cannot be made with a single employee and therefore I have declined to approve the Agreement. Given this conclusion it is not necessary to determine if an agreement voted on by a single employee has been approved by a valid majority of employees or to determine if the Agreement passes the better off overall test.
COMMISSIONER
Appearances:
Mr N Chi for the Applicant.
Hearing details:
2011.
Melbourne.
April 20.
1 Submissions of the Applicant dated 15 April 2011 at [29]
2 Ibid at [30]
3 Ibid at [33]
4 Ibid at [36]
5 [2010] FWA 2952
6 Ibid at [15]
7 [2010] FWA 9508
8 [2010] FWA 4133
9 Submissions of the Applicant dated 21 April 2011 at [8]
10 PR 921970
11 Ibid at [70]
12 (1969) 117 CLR 651 at 656
13 Explanatory memorandum at [642]
15 Ibid at [643]
16 Ibid at [644]
17 National Transport Operations Pty Ltd op cit
18 TWU v National Transport Operations Pty Ltd PR932348
19 Lowday op cit at [7]
20 Ibid at [7] and [8]
21 Delcorp op cit
22 Ibid at [20]
23 Melbourne Nursing Agency Pty Ltd op cit
Printed by authority of the Commonwealth Government Printer
<Price code C, PR509876>
1
4
0