Kaizen Hospitals (Essendon) Pty Ltd & Ors v Australian Nursing and Midwifery Federation & Ors

Kaizen Hospitals (Essendon) Pty Ltd and others (the employers) sought judicial review of a decision by the Fair Work Commission (the Commission) to certify an enterprise agreement. The Australian Nursing and Midwifery Federation and others (the unions) were the respondents. The dispute concerned whether the Commission had erred in certifying the agreement, which the employers argued contained provisions that were not permitted by the *Fair Work Act 2009* (Cth) (the Act). The matter was heard by Gageler and Gordon JJ of the High Court of Australia.

The central legal issue before the High Court was whether the Commission had correctly interpreted and applied section 186(2)(a) of the Act, which requires that an enterprise agreement must not contain provisions that are "not permitted by this Act". Specifically, the employers contended that certain clauses within the certified agreement were unlawful because they purported to confer rights or impose obligations that were outside the scope of what the Act permits an enterprise agreement to regulate. The unions argued that the clauses were valid and fell within the permissible scope of enterprise bargaining.

The High Court found that the Commission had erred in certifying the agreement. Their Honours reasoned that section 186(2)(a) acts as a statutory constraint on the content of enterprise agreements, preventing them from including provisions that are not permitted by the Act. They held that the impugned clauses in the agreement went beyond the scope of matters that the Act authorises to be included in an enterprise agreement, and therefore, the Commission had no power to approve an agreement containing such provisions. The legal principle applied was that the scope of an enterprise agreement is strictly limited by the *Fair Work Act 2009* (Cth), and any provision that falls outside this statutory framework renders the agreement invalid.

The High Court made orders quashing the decision of the Fair Work Commission to certify the enterprise agreement.