Linfox Australia Pty Ltd

[2019] FWCA 972

[2019] FWCA 972

The attached document replaces the document previously issued with the above code on 14 February 2019.

The document previously issued with the above code on 14 February 2019 contained an inadvertent error in the chronology of the document’s paragraph numbers (paragraph [1] of the Decision was included twice in error).

The attached document rectifies the above issue.

Associate to Deputy President Bull

Dated 15 February 2019

[2019] FWCA 972

FAIR WORK COMMISSION

DECISION

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

Linfox Australia Pty Ltd
(AG2018/5653)

BEVCHAIN NEW SOUTH WALES (CUB ROSEHILL – NATIONAL UNION OF WORKERS) GREENFIELDS AGREEMENT 2018

Road Transport and Storage services
DEPUTY PRESIDENT BULL	SYDNEY, 14 FEBRUARY 2019

Application for approval of the BevChain New South Wales (CUB Rosehill - National Union of Workers) Greenfields Agreement 2018; a Greenfields Agreement.

[1] An application (Form F19) has been made by Linfox Australia Pty Ltd (the applicant) for the approval of an enterprise agreement known as the BevChain New South Wales (CUB Rosehill – National Union of Workers) Greenfields Agreement 2018 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single-enterprise greenfields agreement as per s.182(3) of the Act.

[2] The application was accompanied by the statutory declaration (Form F20) of Mr Blake Byrne, Workplace Relations Officer made on behalf of the applicant.

[3] The Agreement has been made between the applicant and the National Union of Workers - New South Wales Branch (NUW). Mr Bruno Mendonca, Assistant Branch Secretary of the NUW, has filed a statutory declaration (Form F21) stating that the NUW support approval of the Agreement.

[4] The Agreement states at clause 2.1 – Coverage:

“2.1 This Agreement covers:

(a) BevChain

(b) each employee of BevChain who performs work in a classification set out in Appendix 1 of this agreement and who is engaged a 5 Devon Street Rosehill NSW 2142;

(c) any replacement site or additional site to service the CUB work;

(d) the NUW.”

[5] I am satisfied that the group of employees covered by the Agreement was fairly chosen taking into account the operational, organisational and geographical distinction of the employees covered under the Agreement. 1

[6] Section 172(2) of the Act provides, relevantly, that an employer may make an enterprise agreement:

“(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 proposed to establish; and

(ii) the employer or employers have not employed any of the persons who will be necessary for the normal conduct of the employer’s enterprise and will be covered by the agreement.”

[7] As per s.172(4) of the Act, such an agreement when made is a greenfields agreement.

[8] Section 172(2)(b)(i) of the Act extracted above requires a greenfields agreement to relate to a genuine new enterprise the employer is proposing to establish. Section 12 of the Act defines an enterprise as a business, activity, project or undertaking.

[9] Mr Byrne attests that BevChain has reached an agreement with a company to establish a genuine new enterprise to undertake and manage the delivery of their product. Mr Byrne states that there is no transfer of business and BevChain has not employed anyone who will perform the work.

[10] On 26 October 2018 the Commission received an email from Mr Gavin Webb, the Chief Legal Officer of the Transport Workers’ Union NSW (TWU), stating that the TWU objected to approval of the Agreement on the basis that there is already another enterprise agreement currently applying to the site and work for which the proposed Greenfields Agreement intends to cover. The TWU identified the existing agreement as the BevChain New South Wales and Transport Workers’ Union Road Transport and Distribution Centres Agreement 2018 (the NSW Agreement) which covers the TWU.

[11] As a result of the TWU’s proposed objection, BevChain and the NUW were asked to provide any written comment by 25 January 2019. Subsequently, on 21 January 2019, the Commission received advice from the TWU that it no longer pressed its objection to the approval of the Agreement.

[1] However, despite the withdrawal of the objection by the TWU the Commission sought further clarification from BevChain as to why the NSW Agreement referred to by the TWU had no application to the work covered by the proposed Greenfields agreement.

[2] On 25 January 2019, Mr Byrne advised the Commission that the NSW Agreement was a site specific enterprise agreement and that clause 2.1 of the NSW Agreement provides that it covers and applies to employees who are employed at sites listed in Appendix 2. The Rosehill Site which the proposed Greenfield agreement applies to is not listed in Appendix 2 of the NSW Agreement.

[3] I am satisfied based on the statutory declaration of Mr Byrnes, and the further information provided to the Commission, that the Agreement coverage relates to a genuine new enterprise.

[4] As required by s.172(2)(b)(ii) of the Act I am further satisfied, accepting the statutory declaration of Mr Byrne, that the applicant has not employed any of the persons who will be necessary for the normal conduct of the new enterprise and who will be covered by the Agreement.

Public Interest

[5] Section 187(5)(b) of the Act states that it is a requirement that the Commission is satisfied a greenfields agreement is in the public interest for it to be approved.

[6] In submitting that it is in the public interest that the Agreement is approved, Mr Byrne states at 2.5 of his statutory declaration that the:

“Terms and conditions of the agreement are consistent with or in excess of the NEA (sic) 2 and the relevant modern award. Jobs growth and employment opportunities for persons residing in the local areas will result as consequence (sic) of the approval of the agreement.”

[7] In supporting the approval of the Agreement Mr Mendonca, on behalf of the NUW, states in respect of the public interest requirement that:

“The Agreement will provide employment opportunities in the local region for workers and provide above award wages.”

[8] Although it has been held that the expression ‘public interest’ has no fixed and precise content, 3 the meaning of ‘public interest’ was addressed by a Full Bench of the Australian Industrial Relations Commission in Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000 (2005) 139 IR 34 where the Full Bench stated:

“The notion of public interest refers to matters that might affect the public as a whole such as the achievement or otherwise of the various objects of the Act, employment levels, inflation, and the maintenance of proper industrial standards. An example of something in the last category may be a case in which there was no applicable award and the termination of the agreement would lead to an absence of award coverage for the employees. While the content of the notion of public interest cannot be precisely defined, it is distinct in nature from the interests of the parties. And although the public interest and the interests of the parties may be simultaneously affected, that fact does not lessen the distinction between them.” 4

[9] In respect of the assessment of the public interest required by s.187(5)(b) of the Act, the Supplementary Explanatory Notes to the Fair Work Bill 2008 state:

“In assessing the public interest, it would be expected that FWA would take into account the objects of the Act, and the need to ensure that the interests of employees who are to be employed under the Agreement are appropriately represented.” 5

[10] In the Commission’s view, the public interest in approving the Agreement can be best related to the anticipated jobs growth and employment opportunities for persons residing in the local areas.

Better off overall test

[11] Section 186(2)(d) of the Act requires the Agreement to pass the better off overall test (BOOT). A greenfields agreement passes the BOOT if the Commission is satisfied, as at test time, that each prospective award-covered employee for the Agreement would be better off overall if the Agreement applies to the employee than if the relevant modern award applied to the employee.

[12] Section 193(3) of the Act defines the ‘test time’ as being when the application for approval of the Agreement was made.

[13] In Armacell Australia Pty and Others 6a Full Bench of Fair Work Australia said:

“The BOOT, as the name implies, requires an overall assessment to be made. This requires identification of terms which are more beneficial for an employee, terms which are less beneficial and an overall assessment of whether an employee would be better off under the agreement.”

[14] Mr Byrne’s statutory declaration (F20) states that there are no less beneficial terms or conditions of employment than those contained in the Storage Services and Wholesale Award 2010 (the Award) being the appropriate reference instrument.

[15] Attached as Annexure A to the statutory declaration was a list of terms and conditions of the Agreement said to be more beneficial than the Award. In summary, these are said to be an increase in wage rates of between 10.9% and 23.87% and increased redundancy benefits.

[16] I am satisfied that the Agreement passes the BOOT.

[17] The application has been made within the 14 day time limit established by subsection 185(4) of the Act.

[18] I am further satisfied that each of the requirements of ss.186 and 187 of the Act as are relevant to this application for approval of the Agreement have been met.

[19] I am satisfied that the NUW is entitled to represent the industrial interests of a majority of employees who will be covered by the Agreement in relation to work that is to be performed under it and is therefore covered by the Agreement. 7

[20] I am also satisfied for the reasons provided above that it is in the public interest to approve the Agreement.

[21] I note that the Agreement contains an Individual Flexibility term at clause 50 and a Consultation term at clause 24.

[22] Part 2-4 of the Act includes various procedural requirements that must be satisfied before the Commission can approve of an enterprise agreement. I have considered all the material filed by the applicant and I am satisfied that the procedural requirements of Part 2-4 of the Act have been met.

[23] The Agreement is approved.

[24] In accordance with s.54(1) of the Act the Agreement will operate 7 days from the date of this approval.The nominal expiry date of the Agreement as indicated in clause 3 Term of the Agreement is 4 years after the commencement date.

DEPUTY PRESIDENT

 1   S.186(3) and s.186(3A) of the Act

 2   This is assumed to be a reference to the National Employment Standards (NES)

 3   Gregory v Qantas Airways Ltd and Another (2016) 241 FCR 72 at [53] per Buchanan J, with whom Bromberg and Rangiah JJ agreed

 4 (2005) 139 IR 34 at 40

 5   At [118]

 6   [2010] FWAFB 9985 at [41].

 7   S.187(5)(a) and s.53(2)(b)

Printed by authority of the Commonwealth Government Printer

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