Fuchs Lubricants (Australasia) Pty Ltd T/A Fuchs

[2024] FWCA 3137

[2024] FWCA 3137

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.185 - Application for approval of a single-enterprise agreement

Fuchs Lubricants (Australasia) Pty Ltd T/A Fuchs

(AG2024/2871)

FUCHS LUBRICANTS (AUSTRALASIA) PTY LTD ENTERPRISE AGREEMENT 2024

Oil and gas industry
COMMISSIONER CONNOLLY	MELBOURNE, 29 AUGUST 2024

Application for approval of the Fuchs Lubricants (Australasia) Pty Ltd Enterprise Agreement 2024

Approval

1. An application has been made for approval of an enterprise agreement known as the Fuchs Lubricants (Australasia) Pty Ltd Enterprise Agreement 2024 (the Agreement) pursuant to s.185 of the Fair Work Act 2009 (the Act) by Fuchs Lubricants (Australasia) Pty Ltd T/A Fuchs (the Applicant). The Agreement is a single enterprise agreement.

1. The matter was allocated to my Chambers on 9 August 2024.

1. The notification time for the Agreement under s.173(2) was 2 May 2024 and the Agreement was made on 22 July 2024.  Accordingly, the genuine agreement requirements the Agreement is to be assessed under are those applying after 6 June 2023 and the better off overall test (BOOT) is that applying on and from 6 June 2023. [1] 

1. On 15 August 2024, the Employer was invited to address aspects of the Agreement including through the provision of an undertaking.

1. In respect of the alleged Notice of Employee Representational Rights (NERR) deficiency, I do not believe that the typographical error had the effect of disenfranchising any employee who is covered by the proposed Agreement from participation in the bargaining process. I am satisfied (taking into consideration s.188(5) of the Act and the decision in Huntsman Chemical Company Australia Pty Limited T/A RMAX Rigid Cellular Plastics & Others) that the procedural or technical error is minor and that the employees were not likely to have been disadvantaged, and accordingly, that there has been a genuine agreement.

1. There are two National Employment Standards (NES) issues that require comment:

·   Compassionate leave – stillbirth consideration: The entitlement to compassionate leave provided by Clause 33 does not appear to be triggered after the stillbirth of a child of the employee or a member of the employee’s immediate family or household as per s.105(1)(b) of the Act or after the employee or the employee’s spouse or de facto partner has a miscarriage as per s.105(1)(c) of the Act.

·   Notice of Termination: Clause 18.2.2 states if the employee fails to give notice the Employer has the right to withhold monies due to the employee in respect of the period of notice given less any period of notice actually given. However, this may reduce an employee’s NES entitlement payable on termination.

1. Clause 6.1 of the Agreement acts as an effective NES precedence clause, in that it states that “This Agreement shall be read and interpreted in conjunction with the National Employment Standards (NES) provided that where there is any inconsistency between this Agreement and the NES, the more beneficial provision to an Employee shall take precedence”. As a result of the NES precedence clause, the above clauses will not apply to the extent that they are inconsistent with the NES.

1. The “United 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) of the Act I note that the Agreement covers this organisation.

1. I am satisfied that each of the requirements of ss.186, 187, 188, 190, 193 and 193A of the Act as are relevant to this application for approval have been met.

1. The Agreement is approved and, in accordance with s.54 of the Act, will operate from 7 days after the date of approval of the Agreement. The nominal expiry date is 30 June 2028.

Variation

1. The Agreement lodged contained errors in clauses 10.2 to 10.13 which contained references to incorrect clauses. As clarified by the Applicant in an email on 20 August 2024, and a telephone call on 29 August 2024, the correct clause references were provided to Chambers.

1. Section 218A, which came into effect on 7 December 2022, is as follows:

“218A Variation of enterprise agreements to correct or amend errors, defects or irregularities

(1) The FWC may vary an enterprise agreement to correct or amend an obvious error, defect or irregularity (whether in substance or form).

(2)The FWC may vary an enterprise agreement under subsection (1): (a) on its own initiative; or

(b) on application by any of the following:

(i) one or more of the employers covered by the agreement; (ii) an employee covered by the agreement; or

(iii) an employee organisation covered by the agreement.

(3) If the FWC varies an enterprise agreement under subsection (1), the variation
operates from the day specified in the decision to vary the agreement.”

1. As has been noted in recent decisions of the Commission,[2] s.218A of the Act is not unlike the slip rule found in s.602 of the Act which allows the Commission to correct or amend an obvious error, defect or irregularity (whether in substance or form) in relation to a decision of the Commission. Its evident purpose is to remove complexity associated with varying enterprise agreements containing obvious errors, defects or irregularities by simplifying the process by which corrections may be made.

1. Before an amendment under s.218A can be made, the Commission must first be satisfied of the existence of an obvious error, defect or irregularity (whether in substance or form). Upon the finding of such an error, defect or irregularity, the Commission may, not must, vary the enterprise agreement. The power to vary should only be exercised to the extent necessary to remove the error, defect or irregularity.

1. I am satisfied that the existence of errors in clauses 10.2 to 10.13 of the Agreement which contains a reference to an incorrect clause is an obvious error. While section 218A does not specify what factors should be considered in the exercise of a discretion to vary an enterprise agreement, I am satisfied that the amendment should be made, and that it is appropriate to do so by varying the Agreement pursuant to s.218A of the Act. In the present case, the error is readily identified, as is the correction needed to make the Agreement accurately reflect what was clearly intended. There are no reasons not to exercise my discretion and good reasons to do so. The errors in the above clauses will be amended to reflect the correct clause reference provided by the Employer, as ordered below.

Order

1. I order, pursuant to s.218A of the Act, that the Agreement be varied to correct an obvious error as follows:

1. By deleting the reference to “9.1(a)” in clause 10.2 and replacing it with “10.1.1”.

2. By deleting the reference to “9.3 and 9.9” in clause 10.2.2 and replacing it with “10.5.1 and 10.5.2”.

3. By deleting the reference to “9.2.1” in clause 10.8 and replacing it with “10.2.1”.

4. By deleting the reference to “clauses 9.3 and 9.5” in clause 10.8 and replacing it with “10.5.2”.

5. By deleting the reference to “9.11” in clause 10.12.1 and replacing it with “10.11”.

6. By deleting the reference to “clause 9.12.2” in clause 10.13 and replacing it with “clause 10.12.2”.

7. This order shall take effect on and from the date of this decision.

COMMISSIONER

[1] The Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) made a number of changes to enterprise agreement approval processes in Part 2-4 of the Fair Work Act. Those changes broadly commenced operation on 6 June 2023, subject to various transitional arrangements that included those to effect described above.

[2] See for example [2023] FWCA 844 per Gostencnik DP, and [2023] FWC 115 per Asbury DP (as Vice President Asbury

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