Harbour City Ferries Pty Ltd

[2017] FWCA 221

[2017] FWCA 221

FAIR WORK COMMISSION

DECISION

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

Harbour City Ferries Pty Ltd
(AG2016/4995)

HCF SALARIED AND SENIOR STAFF AGREEMENT 2016

Clerical industry
COMMISSIONER RIORDAN	SYDNEY, 11 JANUARY 2017

Application for approval of the HCF Salaried and Senior Staff Enterprise Agreement 2016.

[1] This decision is in relation to an application by Harbour City Ferries Pty Ltd (HCF) to have approved the Harbour City Ferries Salaried and Senior Staff Enterprise Agreement 2016 (the Agreement).

[2] The Maritime Union of Australia (MUA) and the Australian Municipal, Administrative, Clerical and Services Union-New South Wales and ACT (Services) Branch (ASU) oppose the approval of the Agreement due to a perceived irregularity in the voting process and the non-compliance with section 185(2)(a)(ii) of the Fair Work Act 2009 (the Act), on the basis that the Agreement was lodged without the signature of at least 1 employee representative on 9 August 2016. I note that the Australian Institute of Marine and Power Engineers (AIMPE) lodged a signature page and F18 in support of the application on 5 September 2016.

[3] Leave was granted to allow HCF to be represented by Mr D. Mahendra of Counsel and Ms J. Digby from Corrs Chambers Westgarth. The MUA was represented by its NSW Branch Assistant Secretary Mr P. Garrett. The ASU was represented by its Industrial Officer Ms D. Horafios.

Background

[4] HCF commissioned a private company, Personal Advantage, to conduct the ballot for the proposed Agreement electronically.

[5] 58 employees were entitled to cast a ballot.

[6] 51 employees actually voted with the ballot being declared successful with 27 voting for the Agreement and 24 against (27-24).

[7] 7 employees abstained from voting. Professional Advantage supplied the names of the employees who voted to HCF, thereby identifying the 7 who did not vote. Following an enquiry from the ASU, Mr Valentin Di Sisto, the Manager Employee Relations of HCF, contacted 6 of these employees, (one employee no longer worked for HCF), to ascertain if these employees had attempted to vote but had been denied access. According to an email from Mr Di Sisto to Ms Horafios, the 6 employees did not attempt to vote, therefore, there were no technical issues with the ballot process. Mr Garrett challenged the veracity of this information. I note that Mr Di Sisto did not provide a witness statement at this stage of the proceedings.

[8] The ballot concluded on 27 July 2016. HCF lodged the Agreement on 9 August 2016, in accordance with section 185(3)(a) of the Act. No employee representative had signed the Agreement at the time of lodgement.

[9] The MUA lodged its F18 with the Fair Work Commission (FWC) identifying its concerns with the Agreement on 22 August 2016. The ASU lodged its F18 on 19 September 2016.

[10] AIMPE filed its F18 and signature page in support of the Agreement on 5 September 2016.

[11] The FWC sent correspondence to HCF raising a number of concerns in relation to the pre-approval steps undertaken by the Company as well as a number of the Agreement’s clauses, on 7 September 2016.

[12] HCF sent a new F17 and proposed undertakings to resolve these concerns to the FWC on 12 September 2016.

[13] The relevant legislation from the Fair Work Act 2009 (Act) and Regulation from the Fair Work Regulations 2009 (Regulations) are extracted below:

Section 180

Employees must be given a copy of a proposed enterprise agreement etc.

Pre-approval requirements
(1)  Before an employer requests under subsection 181(1) that employees approve a proposed enterprise agreement by voting for the agreement, the employer must comply with the requirements set out in this section.
Employees must be given copy of the agreement etc.
(2)  The employer must take all reasonable steps to ensure that:

(a)  during the access period for the agreement, the employees (the relevant employees ) employed at the time who will be covered by the agreement are given a copy of the following materials:

(i)  the written text of the agreement;
(ii)  any other material incorporated by reference in the agreement; or

(b)  the relevant employees have access, throughout the access period for the agreement, to a copy of those materials.

(3)  The employer must take all reasonable steps to notify the relevant employees of the following by the start of the access period for the agreement:

(a)  the time and place at which the vote will occur;
(b)  the voting method that will be used.

(4)  The access period for a proposed enterprise agreement is the 7-day period ending immediately before the start of the voting process referred to in subsection 181(1).
Terms of the agreement must be explained to employees etc.
(5)  The employer must take all reasonable steps to ensure that:

(a)  the terms of the agreement, and the effect of those terms, are explained to the relevant employees; and
(b)  the explanation is provided in an appropriate manner taking into account the particular circumstances and needs of the relevant employees.

(6)  Without limiting paragraph (5)(b), the following are examples of the kinds of employees whose circumstances and needs are to be taken into account for the purposes of complying with that paragraph:

 (a)  employees from culturally and linguistically diverse backgrounds;
 (b)  young employees;
 (c)  employees who did not have a bargaining representative for the agreement.

Section 181

Employers may request employees to approve a proposed enterprise agreement

(1)  An employer that will be covered by a proposed enterprise agreement may request the employees employed at the time who will be covered by the agreement to approve the agreement by voting for it.
(2)  The request must not be made until at least 21 days after the day on which the last notice under subsection 173(1) (which deals with giving notice of employee representational rights) in relation to the agreement is given.
(3)  Without limiting subsection (1), the employer may request that the employees vote by ballot or by an electronic method.

Section 182

When an enterprise agreement is made

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.
Multi-enterprise agreement that is not a greenfields agreement

Section 183

Entitlement of an employee organisation to have an enterprise agreement cover it

(1)  After an enterprise agreement that is not a greenfields agreement is made, an employee organisation that was a bargaining representative for the proposed enterprise agreement concerned may give the FWC a written notice stating that the organisation wants the enterprise agreement to cover it.
(2)  The notice must be given to the FWC, and a copy given to each employer covered by the enterprise agreement, before the FWC approves the agreement.
Note: The FWC must note in its decision to approve the enterprise agreement that the agreement covers the employee organisation (see subsection 201(2)).

Section 185

Bargaining representative must apply for the FWC's approval of an enterprise agreement

Application for approval
(1)  If an enterprise agreement is made, a bargaining representative for the agreement must apply to the FWC for approval of the agreement.
(1A)  Despite subsection (1), if the agreement is a multi-enterprise agreement that is a greenfields agreement, the application must be made by:

(a)  an employer covered by the agreement; or
(b)  a relevant employee organisation that is covered by the agreement.

Material to accompany the application
(2)  The application must be accompanied by:

(a)  a signed copy of the agreement; and
(b)  any declarations that are required by the procedural rules to accompany the application.

When the application must be made
(3)  If the agreement is not a greenfields agreement, the application must be made:

(a)  within 14 days after the agreement is made; or
(b)  if in all the circumstances the FWC considers it fair to extend that period--within such further period as the FWC allows.

(4)  If the agreement is a greenfields agreement, the application must be made within 14 days after the agreement is made.
Signature requirements
(5)  The regulations may prescribe requirements relating to the signing of enterprise agreements.

Section 186

When the FWC must approve an enterprise agreement--general requirements

Basic rule
(1)  If an application for the approval of an enterprise agreement is made under subsection 182(4) or section 185, the FWC must approve the agreement under this section if the requirements set out in this section and section 187 are met.
Note:          The FWC may approve an enterprise agreement under this section with undertakings (see section 190).
Requirements relating to the safety net etc.
(2)  The FWC must be satisfied that:

(a)  if the agreement is not a greenfields agreement--the agreement has been genuinely agreed to by the employees covered by the agreement; and
(b)  if the agreement is a multi-enterprise agreement:

(i)  the agreement has been genuinely agreed to by each employer covered by the agreement; and
(ii)  no person coerced, or threatened to coerce, any of the employers to make the agreement; and

(c)  the terms of the agreement do not contravene section 55 (which deals with the interaction between the National Employment Standards and enterprise agreements etc.); and
(d)  the agreement passes the better off overall test.

Note 1:       For when an enterprise agreement has been genuinely agreed to by employees, see section 188.
Note 2:       The FWC may approve an enterprise agreement that does not pass the better off overall test if approval would not be contrary to the public interest (see section 189).
Note 3:       The terms of an enterprise agreement may supplement the National Employment Standards (see paragraph 55(4)(b)).
Requirement that the group of employees covered by the agreement is fairly chosen
(3)  The FWC 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, the FWC must, in deciding whether the group of employees covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.
Requirement that there be no unlawful terms
(4)  The FWC must be satisfied that the agreement does not include any unlawful terms (see Subdivision D of this Division).
Requirement that there be no designated outworker terms
(4A)  The FWC must be satisfied that the agreement does not include any designated outworker terms.
Requirement for a nominal expiry date etc.

             (5)  The FWC must be satisfied that:

 (a)  the agreement specifies a date as its nominal expiry date; and
 (b)  the date will not be more than 4 years after the day on which the FWC approves the agreement.

Requirement for a term about settling disputes
(6)  The FWC must be satisfied that the agreement includes a term:

(a)  that provides a procedure that requires or allows the FWC, or another person who is independent of the employers, employees or employee organisations covered by the agreement, to settle disputes:

 (i)  about any matters arising under the agreement; and
 (ii)  in relation to the National Employment Standards; and

(b)  that allows for the representation of employees covered by the agreement for the purposes of that procedure.

Note 1:       The FWC or a person must not settle a dispute about whether an employer had reasonable business grounds under subsection 65(5) or 76(4) (see subsections 739(2) and 740(2)).
Note 2:       However, this does not prevent the FWC from dealing with a dispute relating to a term of an enterprise agreement that has the same (or substantially the same) effect as subsection 65(5) or 76(4).

Section 187

When the FWC must approve an enterprise agreement--additional requirements

Additional requirements
(1)  This section sets out additional requirements that must be met before the FWC approves an enterprise agreement under section 186.
Requirement that approval not be inconsistent with good faith bargaining etc.
(2)  The FWC must be satisfied that approving the agreement would not be inconsistent with or undermine good faith bargaining by one or more bargaining representatives for a proposed enterprise agreement, or an enterprise agreement, in relation to which a scope order is in operation.
Requirement relating to notice of variation of agreement
(3)  If a bargaining representative is required to vary the agreement as referred to in subsection 184(2), the FWC must be satisfied that the bargaining representative has complied with that subsection and subsection 184(3) (which deals with giving notice of the variation).
Requirements relating to particular kinds of employees
(4)  The FWC must be satisfied as referred to in any provisions of Subdivision E of this Division that apply in relation to the agreement.
Note:          Subdivision E of this Division deals with approval requirements relating to particular kinds of employees.
Requirements relating to greenfields agreements
(5)  If the agreement is a greenfields agreement, the FWC must be satisfied that:

(a)  the relevant employee organisations that will be covered by the agreement are (taken as a group) entitled to represent the industrial interests of a majority of the employees who will be covered by the agreement, in relation to work to be performed under the agreement; and
(b)  it is in the public interest to approve the agreement.

(6)  If an agreement is made under subsection 182(4) (which deals with a single-enterprise agreement that is a greenfields agreement), the FWC must be satisfied that the agreement, considered on an overall basis, provides for pay and conditions that are consistent with the prevailing pay and conditions within the relevant industry for equivalent work.
Note:          In considering the prevailing pay and conditions within the relevant industry for equivalent work, the FWC may have regard to the prevailing pay and conditions in the relevant geographical area.

Section 188

When employees have genuinely agreed to an enterprise agreement

An enterprise agreement has been genuinely agreed to by the employees covered by the agreement if the FWC is satisfied that:
(a)  the employer, or each of the employers, covered by the agreement complied with the following provisions in relation to the agreement:

(i)  subsections 180(2), (3) and (5) (which deal with pre-approval steps);
(ii)  subsection 181(2) (which requires that employees not be requested to approve an enterprise agreement until 21 days after the last notice of employee representational rights is given); and

(b)  the agreement was made in accordance with whichever of subsection 182(1) or (2) applies (those subsections deal with the making of different kinds of enterprise agreements by employee vote); and
(c)  there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees.

Section 190

FWC may approve an enterprise agreement with undertakings

Application of this section
(1)  This section applies if:

(a)  an application for the approval of an enterprise agreement has been made under subsection 182(4) or section 185; and
(b)  the FWC has a concern that the agreement does not meet the requirements set out in sections 186 and 187.

Approval of agreement with undertakings
(2)  The FWC may approve the agreement under section 186 if the FWC is satisfied that an undertaking accepted by the FWC under subsection (3) of this section meets the concern.
Undertakings
(3)  The FWC may only accept a written undertaking from one or more employers covered by the agreement if the FWC is satisfied that the effect of accepting the undertaking is not likely to:

(a)  cause financial detriment to any employee covered by the agreement; or
(b)  result in substantial changes to the agreement.

FWC must seek views of bargaining representatives
(4)  The FWC must not accept an undertaking under subsection (3) unless the FWC has sought the views of each person who the FWC knows is a bargaining representative for the agreement.
Signature requirements
(5)  The undertaking must meet any requirements relating to the signing of undertakings that are prescribed by the regulations.

Section 191

Effect of undertakings

(1)  If:

(a)  the FWC approves an enterprise agreement after accepting an undertaking under subsection 190(3) in relation to the agreement; and
(b)  the agreement covers a single employer;

the undertaking is taken to be a term of the agreement, as the agreement applies to the employer.

Section 193

Passing the better off overall test

When a non-greenfields agreement passes the better off overall test
(1)  An enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if the FWC is satisfied, as at the test time, that each award covered employee, and each prospective award covered employee, for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.

Regulation 2.06A

Bargaining representative must apply for FWC approval of an enterprise agreement--requirements for signing agreement

(1)  For subsection 185(5) of the Act, this regulation prescribes the requirements for the signing of an enterprise agreement.
(2)  For paragraph 185(2)(a) of the Act, a copy of an enterprise agreement is a signed copy only if:

(a)  it is signed by:

(i)  the employer covered by the agreement; and
(ii)  at least 1 representative of the employees covered by the agreement; and

(b)  it includes:

(i)  the full name and address of each person who signs the agreement; and
(ii)  an explanation of the person's authority to sign the agreement.

Note: Paragraph 185(2)(a) of the Act requires an application for approval of an enterprise agreement to be accompanied by a signed copy of the agreement.
(3)  Unless the representative of the employees covered by the agreement is an employee in a class of employees who will be bound by the agreement, the representative's signature is not taken to indicate that the representative intends to be bound by the agreement.

Submissions

[14] HCF contended that there were only three issues involved in the arbitration of this matter, namely:

a) did HCF provide incorrect information to employees in relation to the conduct of the ballot;

b) did HCF mislead its employees in respect to privacy to the extent that it had an actual influence on the outcome of the vote;

c) should the FWC exercise its discretion in accordance with section 586(1) of the Act and accept the signature page from AIMPE.

[15] HCF argued that they have complied with the relevant provisions of the Act and that the FWC must approve the Agreement in accordance with section 186 of the Act. Further, that the Agreement has been genuinely agreed to by a secret ballot of employees with a majority of eligible employees approving the Agreement.

[16] HCF submitted that the Staff Bulletin of 14 July 2016 was the only substantive communication to employees about the vote and that this information was clear and unambiguous.

[17] HCF posited that Personal Advantage conducted the vote, as advised, between 9am on 26 July 2016 until 4pm 27 July 2016. Personal Advantage provided HCF with a list of employees who voted. 7 employees did not vote. Following an enquiry from the ASU, Mr Di Sisto took it upon himself to contact each of the 6 remaining employees.

[18] HCF denied that it had breached the secrecy provisions of the ballot. HCF argued that it is not aware of how any employee voted and that the ballot had been conducted properly by its third party provider Personal Advantage.

[19] HCF argued that the contact made by Mr Di Sisto was after the conclusion of the ballot and therefore after the Agreement was made (see section 182(1)). There was no capacity to influence the outcome of the ballot because the ballot had been concluded and finalised.

[20] HCF referred to the decision of Sams DP in Aurizon Operations Limited and another 1 where it was held:

“[113] From this limited evidence, much of it hearsay, and which indicated that at least three graduates had voted in the ballot, I cannot be satisfied that the Unions have established a sound evidentiary foundation for a conclusion that sufficient employees were so confused that they did not vote. I am fortified to this conclusion by the unlikelihood that such employees were confused in circumstances where:

(a) the vote was conducted over a seven day period, although for some it may have been four days;

(b) all employees were made aware of the employee helpline for any assistance or advice on the Agreement and the voting process;

(c) the very public, controversial and long running negotiations around the terms of the proposed agreement would have been well known and understood by the employees;

(d) the Unions had mounted a vigorous and intense ‘No’ campaign against the approval of the three enterprise agreements; and

(e) it might be reasonably assumed that there would be a high level of understanding and participation in the approval vote by employees covered by the Staff Agreement.

[114] In any event, the statutory provisions governing the voting process for an enterprise agreement, do not envisage the Commission conducting a rather difficult conceptual test of speculating whether a particular employee or group of employees were so confused that they decided not to vote. This must be particularly so, in the absence of any direct evidence that some employees were so confused that they did not vote.

[115] The Commission regularly reviews enterprise agreements where the number of validly cast votes do not go anywhere near the number of employees who are to be covered by the proposed agreement. I sometimes ask the parties to speculate why there is such a low voter turnout and the answers are just that - speculation. In the absence of asking each employee why they did not vote (which would hardly be useful), the only statutory test which matters is whether there was a majority of those who cast a valid vote for the approval of the Agreement.”
(my emphasis)

[21] HCF also referred to the decision of Cambridge C in Australian Maritime Officers’ Union v Harbour City Ferries Pty Ltd and Others and Harbour City Ferries Maritime Agreement 2015 2where it was held:

“[123] There was no evidence provided by or on behalf of any individual who suggested that they had been misled by any of the communications made by the MUA. However, the Commission was asked to infer there was prospect that, because of the nature and content of various communications from the MUA, voters may have been misled and their votes had been improperly influenced by the false or misleading representations made by the MUA.

[124] In the absence of any direct evidence about false or misleading communications which actually influenced any of the relevant employees, there is no sound basis upon which to infer that the vote which was conducted on 30 July 2015 was somehow improperly influenced. Particularly in view of the significant majority vote that was recorded, it would seem that there would be negligible capacity, even if a handful of individuals were misled, for there to be any valid basis to disturb the ballot outcome.”

[22] HCF acknowledged that the FWC cannot approve an agreement unless section 185(2)(a) of the Act and Regulation 2.06A of the Regulations have been complied with by the parties.

[23] HCF submitted that they had sent each of the Unions the relevant documentation seeking their urgent attention and completion. None of the Unions responded in the required time so HCF lodged the agreement in order to meet the statutory timeframe. Eventually, AIMPE lodged their F18 and signature page. HCF requested that the FWC use its powers under section 586 of the Act to amend the original application from HCF by substituting the signature page filed in the application with the signature page filed by AIMPE on 5 September 2016.

[24] HCF argued that union bargaining representatives, who do not agree with the outcome of an enterprise agreement negotiation and ballot result, should not be able to “gridlock” an agreement by refusing to sign the agreement during the statutory timeframe for lodgement.

[25] HCF referred to the FWC Full Bench decision in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; Australian Manufacturing Workers Union v Sustaining Works Pty Limited 3, where it was held:

“[29] The copy of the Agreement which accompanied Sustaining Works’ application for approval of the Agreement was not signed in accordance with reg.2.06A(2). It was signed by two persons “for and on behalf of the Employees”. The first of these gave his name as “C. Fabar”. That is not a full name. The “address” given was “Leightons Chinchilla”. That is not, in accordance with common understanding, an address. The second employee, Kieth [sic] Johnson, gave an “address” as “c/o Leighton Contractors”. That is also clearly not a proper address.

[30] Section 185(2) is expressed in mandatory terms. Section 186(1) empowers approval of an enterprise agreement only if “an application for the approval of an enterprise agreement is made under section 185 …”. We consider that an application “under” s.185 must be one made in accordance with it. Further, s.585 requires that “An application to the FWC must be in accordance with the procedural rules (if any) relating to applications of that kind”. Accordingly it is not open to the Commission to simply ignore a failure to comply with the signature requirements. Section 586 empowers the Commission to deal with errors and irregularities in applications and associated documents as follows:

586 Correcting and amending applications and documents etc.

The FWC may:

(a) allow a correction or amendment of any application, or other document relating to a matter before the FWC, on any terms that it considers appropriate; or

(b) waive an irregularity in the form or manner in which an application is made to the FWC.

[31] However, because the signature issue was never raised before the Commissioner, there was never any opportunity for the exercise of the power in s.586 to deal with the problem. As a result the Commissioner’s approval of the Agreement was arguably not in accordance with s.186(1) because he did not have before him an application made in accordance with s.185.”

[26] The MUA submitted that the integrity of the ballot process was compromised by Professional Advantage identifying to HCF the names of the 7 employees who abstained from the ballot. The MUA argued that this occurrence was in breach of the specifications of the ballot process and undermined the intended secrecy of the ballot. The MUA highlighted an email from Mr Di Sisto to Mr Vincent, from Personal Advantage, on 7 July 2016 4 which said:

“From: Valentin Di Sisto

Sent: Thursday, 7 July 2016 10:48am

To: Peter Vincent

…Also, we don’t want a list of the people who voted, only the number of votes and the result. And no one in HCF should have access to that information. Is it possible to fix this?...”

[27] As part of the Agreement explanation process, HCF sent a Staff Bulletin to the relevant employees in relation to the “EBA – Senior & Salaried Negotiations” on 14 July 2016 5, which contained the following:

“…As you are aware, during the last 8 months HCF Management has been working with the Maritime Union of Australia, the Australian Services Union and the Australian Institute of Marine and Power Engineers to settle the terms and conditions of employment of HCF Salaried and Senior employees and provide the basis for a viable and sustainable business.

Unfortunately, after such extensive negotiations we have not reached agreement. Instead, we have come to a point where it is clear that the bargaining parties are not prepared to make any further concessions.

As a result, HCF Management has decided to propose a set of terms and conditions of employment, which we believe best capture the interests and needs of HCF Senior and Salaried employees and provide the basis for a viable and sustainable business.

The proposed Enterprise agreement is enclosed to this correspondence. We now ask you to carefully consider it and we hope that you will endorse it by voting for it in the upcoming ballot…

…The ballot will be conducted from 9.00am on 26 July 2016 to 4.00pm on 27 July 2016 by electronic vote. HCF has engaged an external company to conduct the electronic vote to ensure that your vote is kept secret. This means that HCF will be advised of the vote count but not how each individual voted…

… The proposed Enterprise Agreement includes references to HCF Code of Conduct, HCF Training and Development policies (Study Leave), Performance Management Policy and Performance Management Procedures. These documents can be accessed via the following link: Salaried and Senior Staff Agreement 2016 – Documents…” (my emphasis)

[28] The MUA submitted that HCF does in fact know how 7 employees voted, ie, they abstained from voting. The MUA was disturbed that HCF then contacted 6 of these employees to ascertain why they did not vote. As a result of this alleged breach of privacy, the MUA questioned whether the Agreement has been made in accordance with section 180-181 of the Act.

[29] The MUA advised that, following the Conference before the FWC as currently constituted on 10 October 2016, Mr Di Sisto wrote to the MUA advising that he had given Personal Advantage verbal instructions to include the list of names of employees who voted in their ballot report to HCF. The MUA argued that the fact that HCF was collecting this information should have been advised to all employees via the 14 July 2016 staff bulletin.

[30] Further, the MUA were perplexed why HCF changed their written instructions to Personal Advantage via a verbal instruction. Also, why the draft staff bulletin, dated 8 July 2016, included the following sentence:

“This means that HCF will be advised of the vote count only (i.e the total number of votes in favour and against) and will not be advised of whether you did or did not vote, or how you voted.” 6

The MUA acknowledged that the draft bulletin of 8 July 2016 was not sent to the employees.

[31] The MUA advised that they did not deliberately withhold their signature from the Agreement, but simply ran out of time to sign the Agreement before it was lodged for approval. The MUA advised that all Enterprise Agreements to which the MUA is a signatory, must be endorsed by its National Council before a relevant officer of the Union has the authority to sign the Agreement. HCF only gave the MUA one business day to undertake this task – which is a procedural impossibility for the Union.

[32] The MUA submitted that sections 185(2)(a)&(b) of the Act are mandatory provisions. On the basis that HCF had not lodged a signed copy of the Agreement, the MUA argued that the FWC was obligated to dismiss the current application.

[33] Whilst deliberating my decision in this matter, I sought clarification from the parties in relation to a number of possible deficiencies in the Agreement, including the absence of a clause dealing with the payment of employee superannuation entitlements, a lack of clarity about the quarterly or annual CPI figure to be used for future wage increases and the absence of a descriptive classification structure.

[34] Following a conference on 22 November 2016, a further hearing was held on 12 December 2016 to deal with these issues.

[35] At the hearing, HCF provided further undertakings in accordance with section 190 of the Act to overcome any possible deficiency. Whilst that is an appropriate course of action, particularly in relation to the issue of superannuation and the annual wage increase, the lack of a detailed classification structure in the filed Agreement raises the issue of whether the employees were given an appropriate explanation of the terms of the Agreement in accordance with section 180(5) of the Act.

[36] Logic would normally dictate that, where an Agreement has no mention of classification descriptors and intentionally excludes all previous Agreements that have applied to this group of employees, a detailed presentation of the classification structure would have been included in the Agreement explanation presentations. It is not contested that such an explanation did not occur.

[37] Mr Di Sisto provided a written statement and gave evidence in relation to the classification issue at the hearing on 12 December 2016. Mr Di Sisto testified that all employees are fully aware of their classification and their progression increments via their employment contract.

[38] Relevantly, Mr Di Sisto testified that he conducted all 6 of the Agreement explanation sessions and that no employee asked any questions about the classification structure. Also, he did not receive any questions by email or telephone about this issue.

[39] Ms Debbie Price, a Human Resources Advisor employed by HCF, testified that the current classification structure is identical to the one utilised by Sydney Ferries since 2007. Ms Price advised that part of her role at HCF is to interview prospective employees. Ms Price testified that she explains the relevant classification structure to all prospective new employees during the interview stage. When an applicant is successful in gaining employment with HCF, Ms Price confirmed the evidence of Mr Di Sisto in relation to the relevant material sent to the employee as part of their starter pack.

[40] Relevantly, Ms Price testified that, during her 9 years of employment with both Sydney Ferries and HCF, she cannot recall an employee asking her to explain the classification structure or advising her that they are confused about the classification structure.

[41] The ASU sought to tender a statement from Mr Roger Harradence, who is a Technical Superintendent employed by HCF. Unfortunately, Mr Harradence was not available for cross examination. As a result, I marked his statement as an MFI only. I have afforded the statement of Mr Harradence little evidentiary value.

[42] HCF argued that s180(5) of the Act only requires the employer to take “all reasonable steps” to explain the provisions of the Agreement. As such, HCF submitted that this group of employees are salaried and senior staff employees. As such, HCF was confident that these employees had an existing knowledge and understanding of their classification.

[43] HCF also submitted that during the lengthy and robust bargaining process, no union bargaining representative asked any questions or raised any enquiry about the lack of a descriptive classification structure in the proposed Agreement.

Consideration

[44] I have taken into account all of the submissions and evidence that has been provided by the parties. The fact that certain issues raised by the parties, do not appear in this decision, does not mean that they have not been considered.

[45] It is not uncommon in a union ballot process, where an individual has abstained from voting, for that vote to be counted as a negative vote. However, in accordance with the Act, the outcome of an enterprise agreement ballot is determined by the majority of the valid votes that have been cast. In this matter, the ballot was conducted and a narrow majority was achieved in favour of the Agreement. I have taken this into account.

[46] I do not support the idea of a third party conducting the ballot process providing a list of employees who actually voted to the employer or any other bargaining representative. This information serves no useful purpose after the ballot has been concluded and can only lead to possible mischief in the future. When an individual votes in a secret ballot, they should feel comfortable that their decision is secret – whether they vote yes, no or abstain. To do otherwise, undermines the credibility of the process. I have taken this into account.

[47] The action of Mr Di Sisto in contacting the 6 remaining employees who did not vote after the ballot was unfortunate and inappropriate. If there was a complaint in relation to a possible technical difficulty involving the ballot, then Mr Di Sisto should have either put out a note to all employees inviting a response from anyone who may have experienced any technical problems when trying to vote or request that Personal Advantage contact any individual who did not vote. I have taken this into account.

[48] I have taken into account that AIMPE filed their F18 and signature page after the Agreement was lodged.

[49] I acknowledge the submission of the MUA that it is sometimes impossible for a Union to comply with its own Rules in relation to the signing of enterprise agreements within the statutory timeframe. I do not accept the submission of HCF that the Unions’ were involved in some type of tactical manoeuvre to create a scenario where the Agreement approval process would fail. It is a far better outcome for a union to request the FWC to use its discretionary power in accordance with section 586 of the Act, than be forced to answer questions from the General Manager of the FWC, or some other external body, as to why it has breached its Rules. I have taken this into account.

[50] Whilst I am curious as to why Mr Di Sisto changed his written instructions to Personal Advantage in relation to the provision of the list of voters, the issue, in my view, is irrelevant. I accept that most employees would have been of the view that their voting preference would be kept secret. However, the provision of the list did not influence the ballot. The 7 employees who abstained from voting have had every opportunity to complain that they were denied access to the ballot. No employee has lodged a complaint, therefore the ballot outcome must stand. I have taken this into account.

[51] I have taken into account that no union bargaining representative nor any employee raised any issue or concern in relation to the absence of a descriptive classification structure during the negotiations or the ballot process. I also note that no employee gave evidence of any concerns that they may have had in relation to this issue.

[52] I have taken into account that the employees covered by the proposed HCF Agreement are employed in either salaried or senior staff roles. I acknowledge that these employees would have an inherent knowledge and understanding of their role and function within HCF. I accept that HCF should be able to rely on the inherent knowledge and understanding of their senior employees when it relates to the reasonableness of their explanation of the proposed Agreement.

Conclusion

[53] I find that the ballot process that was undertaken for the approval of the HCF Salaried and Senior Staff Agreement 2016 was conducted in accordance with the Act. In accordance with section 182(1), I find that the Agreement was made at the conclusion of the ballot process on 27 July 2016.

[54] Whilst I hold grave reservations in relation to the appropriateness of the provision of any list of employees who voted in a secret ballot to any bargaining representative, the provision of this information did not have any influence on the outcome of the ballot.

[55] In accordance with section 586 of the Act, I find that it is appropriate for the FWC to utilise its discretion in this circumstance and allow the signature page submitted by AIMPE on 5 September 2016, to replace the original signature page filed with the Agreement.

[56] I am satisfied that HCF complied with all of the mandatory pre-approved steps of the Act. In my view, the classification structure of any agreement is a fundamentally important provision. Logically, this provision should be descriptive or reference an external document, such as a Modern Award. Whilst the HCF Agreement did neither at the time of the ballot, I am satisfied that the employees understood the intricacies of the HCF classification structure based on either their long term employment or the information provided to them in the starter pack in their employment process.

[57] HCF has provided the FWC with appropriate undertakings which cover the issues of Dispute Resolution, Consultation, Superannuation, Annual Wage Increase and the Classification Structure. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement nor do they result in substantial changes to the Agreement. Pursuant to section 191 of the Act, I accept the undertakings provided by HCF.

[58] I am satisfied that the employees covered by the proposed Agreement are better off than if they were employed by the relevant Modern Awards.

[59] The MUA and ASU have provided the FWC with written notice requesting that they be covered by the Agreement, subject to appropriate undertakings being provided by HCF.

[60] In accordance with sections 186 and 187 of the Act, I approve the HCF Salaried and Senior Staff Agreement 2016. The Agreement shall operate from 18 January 2017. The Agreement also covers the MUA and the ASU.

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 1   [2015] FWCA 550

 2   [2015] FWC 8003

 3   [2015] FWCFB 4422

 4   Exhibit H1 – email dated 7 July 2016

 5   MUA outline of submissions dated 26 October 2016

 6   HCF Outline of submissions dated 2 November 2016 – Staff Bulletin dated 8 July 2016