Mammoet Pty Ltd
[2018] FWCA 4425
•27 JULY 2018
| [2018] FWCA 4425 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement
Mammoet Pty Ltd
(AG2017/5412)
Building, metal and civil construction industries | |
DEPUTY PRESIDENT BEAUMONT | PERTH, 27 JULY 2018 |
Application for approval of the Mammoet Pty Ltd Wind Project Agreement 2017-2020 – interested party – right, interest or legitimate expectation – whether bargaining representative.
Introduction
[1] An application has been made for approval of an enterprise agreement known as the Mammoet Pty Ltd Wind Project Agreement 2017-2020 (the Mammoet Agreement). The application was made by the employer, Mammoet Pty Ltd (Mammoet), under s 185 of the Fair Work Act 2009 (the Act) (the Application). The Mammoet Agreement is a single-enterprise agreement.
[2] Mammoet tenders for work on various projects around Australia, including projects involving the construction and installation of wind farms and turbines 1. For these types of projects it provides mobile cranes and the associated labour (the Wind Division)2. Both the Mobile Crane Hiring Award 2010 (Mobile Crane Award) and the Construction General On-site Award 2010 (Construction Award) are the relevant modern awards for this matter.
[3] There is a controversy over whether the Mammoet Agreement should be approved by the Fair Work Commission (Commission). The Construction, Forestry, Maritime, Mining, and Energy Union (CFMMEU) asserts that Mammoet had not taken all reasonable steps to notify the relevant employees of the time and place at which the vote will occur and the voting method; had not taken all reasonable steps to ensure that the terms of the enterprise agreement and effect of the same were explained to employees; the Form 17 included incorrect content about less beneficial terms than under the relevant Award, and there were concerns regarding the authenticity of the Mammoet Agreement on the face of the Application.
[4] I have considered the evidence and submissions of both the parties concerning this Application. Mammoet has provided written undertakings that have addressed my concerns and the CFMMEU was provided with opportunity to provide its view on the written undertakings attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Mammoet Agreement and that the undertakings will not result in substantial changes to the Mammoet Agreement.
[5] Subject to the undertakings referred to at Annexure A, and on the basis of the material contained in the Application, accompanying statutory declaration, witness statement and submissions, I am satisfied that each of the requirements of ss 186, 187, 188 and 190 as are relevant to this Application for approval have been met.
[6] The Mammoet Agreement is approved and, in accordance with s 54, will operate seven days from the date of this decision. The nominal expiry date of the Mammoet Agreement is three years from the date of approval.
[7] My reasons for approving the Mammoet Agreement follow.
BACKGROUND
[8] As noted, Mammoet tenders for work on various wind projects around Australia 3. From the time that the work is awarded, employees are frequently mobilised within a short period4. Ms Jayne Liddicoat, Human Capital Manager (Ms Liddicoat), gave evidence that from the time of signing the contract to when work commences is usually a month5. It follows, she said, the wind project business is a notoriously difficult one in which to mobilise resources6.
[9] When there are no wind projects available, four employees are nevertheless retained by Mammoet to perform incidental work and maintenance on the cranes 7. These employees are retained because of their uncommon and highly specialised skill set, which is required on wind projects8. They also form the core crew on any further projects that are secured9.
[10] Ms Liddicoat said that the Wind Division of Mammoet is different because it undertakes specialised work particular for wind projects and requires only a small number of cranes 10. The crane operators within the Wind Division have skills beyond those of an ordinary crane operator and it is for that reason the four employees are retained even though there is no revenue from clients to cover their salary costs11.
[11] Mammoet was previously known as Mammoet Wind Pty Ltd, and had made a number of enterprise agreements in the past 12 for particular projects on which it was providing mobile crane services13. It was the case, said Ms Liddicoat that when the work on the projects finished, Mammoet continued to employ the four employees.
BUSINESS REASONS FOR MAKING THE AGREEMENT
[12] Mammoet said that it decided to bargain for a new enterprise agreement that had a wider coverage with its four employees for the reasons set out below:
(a) the market conditions, being the lack [sic] certainty until a contract is signed and then a very short period in which work commences, made it practically impossible for Mammoet to make an enterprise agreement in the period between contract award and commencing work;
(b) Mammoet wished to ensure there was certainty of terms and flexibility to mobilise employees quickly with an existing, in-term enterprise agreement already in place for any new work awarded;
(c) Mammoet had submitted a number of tenders, but had not been awarded any work, but it wanted to be ready to mobilise quickly in the event that it was successful in any of those tenders; and
(d) Mammoet was also planning on submitting further tenders for work in other States, and therefore wanted to have in place an enterprise agreement with national coverage 14.
[13] Ms Liddicoat’s evidence was that around February 2018, Mammoet was awarded work on a new wind project which had been due to commence in or around January 2018. There was a requirement to undertake minor pre-works and at the time Mammoet had a requirement for the four employees and potentially one more, to undertake the work. Ms Liddicoat advanced that none of the other enterprise agreements Mammoet had previously made covered this scope of work.
THE ENTERPRISE AGREEMENT
[14] The Mammoet Agreement was ultimately made with three employees.
[15] It was said at Section 3.1 of the Form 17 15 that the Mobile Crane Award currently covered the employer and any of the employees covered by the Mammoet Agreement.
[16] In further Submissions received from the Applicant on 8 June 2018 (Further Submissions), it was stated that the relevant Modern Awards for the Agreement were the Mobile Crane Award, which covered all but two of the 17 classifications under the Construction Award that covered the classifications of Truck and Transport Mechanic and Crane Specialist Mechanic. The remaining classification of Trailer man / SPMT Operator was said not to be an Award covered role. I am satisfied that is the case.
[17] The parties to the Mammoet Agreement were the Employer, who was relevantly defined as Mammoet, and ‘person engaged by the Employer in the classifications contained in Appendix 2 of this Agreement and who perform work for the Employer at wind Farms in Australia’ 16.
[18] ‘Wind Farm’ was defined within the definitions section of the Mammoet Agreement as:
Wind Farm means activities at a wind farm including activities associated with the erection and installation of Wind turbines, including associated transport, loading and unloading of components, and crane work undertaken by the Employer on wind farm projects, including but not limited to erection and assembly of: a. Tower; b. Nacelle; and c. Hub and individual Blades.
[19] Appendix 2 of the Mammoet Agreement could not be located and as such I have found that its absence creates uncertainty in the Mammoet Agreement, given that clause 2 ‘Parties’ and the definition of ‘Employee’ both reference an Appendix 2.
[20] An Appendix A is included which contains classifications of Trades Assistant/Labourer, Dogman, Basic Rigging, Intermediate Rigging, Advanced Rigging, Crane Operator 0 – 25t, Crane Operator 0 – 60t, Crane Operator 0 – 100t, Crane Operator 0 – 160t, Crane Operator 0 – 250t, Crane Operator 0 – 400t, Crane Operator 0 – 600t, General Freight Truck Driver, Heavy Haul Truck Driver, Trailer man / SPMT Operator, Truck and Transport Mechanic and Crane Specialist Mechanic.
[21] In its Further Submissions Mammoet applied under s 217 of the Act for an order to vary the Mammoet Agreement by replacing the words ‘Appendix 2’ with ‘Appendix A’ in the definitions section, as well as in clauses 2.2 and 19.1 of the Mammoet Agreement to remove the uncertainty.
[22] Under the definitions section of the Mammoet Agreement at number 10 a definition of ‘Ordinary Earnings’ referred to Appendix 1, it stated:
Ordinary Earnings shall mean the actual applicable ordinary rate of pay as described in Appendix 1 and paid for all normal time house worked.
[23] No Appendix 1 was located. Mammoet submitted on 23 July 2018 that the reference to Appendix 1 under the definition of ‘Ordinary Earnings’ was intended to be a reference to ‘Appendix A’, which held a page titled ‘Classifications and rates of pay’. Mammoet applied similarly under s 217 to replace this reference to Appendix 1, as well as references to Appendix 1 in clauses 19.5 and clause 26 of the Mammoet Agreement to ‘Appendix A’. Similarly, I have determined that the absence of an Appendix 1 creates an uncertainty.
[24] An undertaking was offered to remedy these references. However, I am not satisfied that an undertaking can address these particular issues. As such, the undertaking set out at number 4 in Annexure A is of no effect.
[25] Having determined to approve the Mammoet Agreement and having found that there is an uncertainty in it, I have decided to exercise my discretion under s 217 of the Act to issue an order 17 to vary the Mammoet Agreement to address the uncertainty found. The order will come into effect on operation of the Mammoet Agreement.
CFMMEU’S OBJECTION TO THE APPROVAL OF THE AGREEMENT
[26] By way of background, on 13 November 2017 the CFMMEU Construction & General Division National Office wrote to the Commission requesting copies of the Form 16, Form 17 and any other documentation submitted by Mammoet in support of its Application.
[27] On 15 November 2017, the CFMMEU wrote to the Commission advising that it had an interest in the matter and should be heard in respect of the Application. It opposed the approval of the Mammoet Agreement on the basis that the Mammoet Agreement had not been genuinely agreed as that term is understood under s 188 of the Act. Reasons for arriving at this conclusion were traversed in the CFMMEU’s correspondence and at a later date in its submissions.
[28] In short, the CFMMEU objected to the approval of the Agreement on a number of grounds, namely: Mammoet had not taken all reasonable steps to notify the relevant employees of the time and place at which the vote will occur and the voting method; had not taken all reasonable steps to ensure that the terms of the enterprise agreement and effect of the same were explained to employees; the Form 17 included incorrect content about less beneficial terms than under the relevant Award, and there were concerns regarding the authenticity of the Mammoet Agreement on the face of the Application.
[29] On 22 November 2017, Ms Liddicoat responded to the issues that had been raised in the correspondence of the CFMMEU on 15 November 2017.
[30] Subsequently, on 1 December 2017, the CFMMEU responded to the correspondence of Ms Liddicoat again agitating its position that the Application should be dismissed for the reasons it had outlined in its letter.
[31] The matter was listed for hearing on 17 April 2018, however after conferral both parties advised the Commission of their preference for the matter to be determined on the papers and I decided to proceed on that basis.
CFMMEU’s INTEREST IN THE MATTER
[32] The CFMMEU advanced that it had an interest in the matter for several reasons. The first of which was that it had members who were employed by the different associated entities operated by Mammoet 18. These associated entities were said to include Mammoet Australia Pty Ltd and Mammoet Pty Ltd which, the CFMMEU said, was previously named as Mammoet Wind Pty Ltd19.
[33] Second, the CFMMEU said that the Mammoet Agreement sought to apply to work already covered by Mammoet Wind Pty Ltd White Rock Wind Farm Project Agreement 2017, which had not passed its nominal expiry date 20. Third, the CFMMEU said the Mammoet Agreement referenced the Mobile Crane Award andit had primary coverage of the mobile crane hiring industry21. According to the CFMMEU it had extensive history and a high degree of familiarity of industrial workers in the mobile crane hiring industry and it followed that was another reason the CFMMEU had an interest22.
[34] Other contentions by the CFMMEU included that it would a right to appeal any approval decision given its constitutional coverage it would be a ‘person aggrieved’, and that it held a view that the Mammoet Agreement was not genuinely agreed under ss 180(3) and (5) of the Act.
[35] With regards to an application under s 185 of the Act an employee organisation may establish standing to be heard because:
(a) it is bargaining representative of one or more employees to be bound by the proposed agreement 23;
(b) as a matter of procedural fairness if the employee organisation is able to establish a right, interest or legitimate expectation that it will be adversely affected by the decision 24; or
(c) if invited by the FWC in the exercise of its power under s 590 of the FW Act to inform itself 25.
[36] On this occasion the CFMMEU advanced that the Commission should use its authority under s 590(1) of the Act to hear from it regarding the approval of the Mammoet Agreement. However, reliance on this section of the Act proved unnecessary. I concluded, for reasons that I will explain shortly, that the CFMMEU was a bargaining representative for the Mammoet Agreement. However, in light of the submissions made and for the sake of completeness, I have nevertheless addressed the submissions of the parties on the CFMMEU’s interest.
Right, interest or legitimate expectation
[37] It is accepted that the Act does not provide for intervention in proceedings before the Commission by a non-party 26.
[38] The CFMMEU asserted that the Mammoet Agreement sought to apply to work already covered by an existing agreement that has not passed its nominal expiry date, namely the Mammoet Wind Pty Ltd White Rock Wind Farm Project Agreement 2017 27(White Rock Agreement).
[39] The CFMMEU was not a party to the White Rock Agreement, its nominal expiry date was 23 May 2018, it applied to work at the White Rock Windfarm Project White Rock Wind Farm, Illparran Road, Matheson NSW 2370, Australia and the relevant employer was Mammoet Wind Pty Ltd. It was not the case that the CFMMEU had rights under the White Rock Agreement and so no right of the CFMMEU is established, or for that matter affected if the Agreement were to be approved 28.
[40] The CFMMEU stated that having regard to its constitutional coverage it will be a ‘person aggrieved’ by any decision to approve the Mammoet Agreement under s 604 of the Act and have a right to appeal an approval decision 29, and on this basis it has an interest in the matter. In support of its submission it relied upon the decision of the Full Bench in CEPU v Main People30.
[41] However the Full Bench in Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited 31 (Collinsville) at Footnote 13 clearly distinguished between standing to bring an appeal in respect of an enterprise agreement approval decision and whether a person should be heard during an application to approve an enterprise agreement. While the CFMMEU may have a right of appeal against any decision to approve the Mammoet Agreement it does not follow that such a right therefore creates a right to be heard in relation to the approval application at first instance32.
[42] The remainder of the submissions made by the CFMMEU 33 are not such that I can conclude that there is a sufficient basis for there to arise a right, interest or legitimate expectation and thereby a conferral on the CFMMEU of a right to be heard.
Section 590(1) of the Act
[43] It is true that the Commission may choose, in a particular case, to hear from an employee organisation or any other person about the approval of an enterprise agreement even though the organisation or person may not otherwise have a right to be heard 34.
[44] I have considered the submissions advanced by the CFMMEU that it has an interest in this matter and have had regard to its request that this Commission should use its authority under s 590(1) of the Act to hear from it.
[45] I do hold the view that the Commission’s deliberations may at times be assisted by a considered contribution from a contradictor.
[46] However, I consider that there is merit in the submissions advanced by Mammoet that the CFMMEU has no relevant knowledge or information about the Mammoet Agreement or the making of the Mammoet Agreement that would likely assist the Commission in its consideration of the Application.
[47] The issues that the CFMMEU have raised relate to whether Mammoet took all reasonable steps to notify the relevant employees of the matters under s 180(3) of the Act, whether the group of employees covered by the Mammoet Agreement was fairly chosen and whether Mammoet took all reasonable steps to ensure the terms of the Mammoet Agreement were explained consistent with the requirements in s 180(5) of the Act. The question of whether ‘reasonable steps’ were taken to notify or explain, or whether the group of employees was fairly chosen is a matter of fact in every case.
[48] The Commission is positioned to conduct this evaluative process and in doing so is able to properly inform itself without recourse to the CFMMEU for assistance on this occasion. However, consideration of the CFMMEU’s status as a bargaining representative is to be considered.
Bargaining representative
[49] The CFMMEU asserted that it had members employed by Mammoet 35, but initially provided no evidence to support its contention.
[50] The evidence of Ms Liddicoat was that the CFMMEU was not a bargaining representative and that Mammoet was not aware that any employees who were entitled to vote on the Mammoet Agreement were members of the CFMMEU 36.
[51] I note that with regard to its case to be heard in its submissions the CFMMEU did not advance that it was a bargaining representative, default or otherwise and relied on s 590(1) of the Act concerning its being heard. However, on 6 June 2018, I issued directions for both the CFMMEU and Mammoet to provide a list of employees who will be covered by the Mammoet Agreement and were employed at the time of voting.
[52] I considered the material provided by both parties, and having no evidence before me to indicate that the relevant employee revoked the status of the CFMMEU or appointed another as a bargaining representative, I am satisfied that by virtue of s 176(1)(b) of the Act, the name of one employee was present on both the list of the CFMMEU and that provided by Mammoet.
[53] Therefore, I have reached the conclusion that the CFMMEU was a bargaining representative for the Mammoet Agreement and on that basis I consider that it has a right in that capacity to be heard.
APPROVAL OF ENTERPRISE AGREEMENT
Genuinely agreed
[54] Section 186 of the Act sets out the circumstances in which the Commission must approve an enterprise agreement. It is a long section but for the purpose of this part suffice to say the enterprise agreement must be genuinely agreed to by employees covered by the enterprise agreement, must not contravene s 55 of the Act regarding the National Employment Standards and must pass the BOOT.
[55] ‘Genuinely agreed’ takes its meaning from s 188 of the Act. This section sets out the following:
188 When employees have genuinely agreed to an enterprise agreement
An enterprise agreement has been genuinely agreed to by 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.
[56] The term is expressed in a way that requires the Commission to satisfy itself of the employer’s compliance with particular bargaining provisions within the Act (ss 188(a) and (b)), and satisfaction of a more general criterion in s 188(c) of the Act 37. It is not simply a general consideration whether in all of the circumstances of a particular enterprise agreement the member is satisfied that the enterprise agreement has been genuinely agreed to38.
[57] In the decision of Ostwald Bros Pty Ltd v Construction, Forestry, Mining and Energy Union (Ostwald), the Full Bench stated the specific requirements in s 188(a) of the Act were:
• Section 180(2) of the Act: The employer must take all reasonable steps to ensure that during the access period for the agreement, “the employees employed at the time who will be covered by the agreement are given a copy” of the agreement and “any other material incorporated by reference in the agreement” or “have access, throughout the access period for the agreement, to a copy of those materials.”
• Section 180(3) of the Act: “The employer must take all reasonable steps to notify the relevant employees” of the “time and place at which the vote will occur” and the voting method by the start of the access period for the agreement.
• Section 180(5) of the Act: The employer must take all reasonable steps to ensure that the terms of the agreement and their effect are explained to the relevant employees, “in an appropriate manner taking into account the particular circumstances and needs of the relevant employees.”
• Section 181(2) of the Act: the request by the employer of the employees employed at the time who will be covered by the agreement to approve the agreement by voting for it “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 39.
[58] Section 188(b) refers to the requirement that the Member must be satisfied that the enterprise agreement must be made in accordance with, in the circumstances of this case, s 182(1) of the Act. This subsection provides if the employees of the employer who will be covered by a proposed enterprise agreement have been asked to approve the enterprise agreement under s 181(1), the enterprise agreement is made when a majority of those employees who cast a valid vote approve the enterprise agreement.
[59] Section 188(c) of the Act, although itself a broad discretionary consideration, is an additional matter about which the Commission needs to be satisfied and relates to grounds other than those arising in relation to the s 188(a) and (b) matters as indicated by the expression ‘other reasonable grounds’ 40.
[60] In KCL Industries Pty Ltd 41 (KCL) the Full Bench examined the requirement of ‘genuinely agreed’ in the context of s 188(c) of the Act. It traced its origin, referred to the Explanatory Memorandum in the Fair Work Bill 2008 and traversed the analysis of s 188 of the Act in decision of the Full Bench in Ostwald and the analysis of s 188(c) of the Act by Asbury DP in Central Queensland Services Pty Ltd42(Central Queensland). In short, the Full Bench in KCL agreed with, and adopted, the majority analysis in Ostwald, and the analysis of Asbury DP in Central Queensland. I similarly intend to do the same.
[61] Of particular relevance to this matter are the decisions of the Federal Court in Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (Gordonstone) 43and Grocon Pty Ltd Enterprise Agreement (Victoria) (Grocon)44, both of which are referred to in KCL.
[62] In Gordonstone the Full Court considered the operation of s 170LT(6) of the Workplace Relations Act 1996 (Cth) (WR Act). This section provided that ‘a valid majority of persons employed at the time whose employment would be subject to the agreement must have genuinely made the agreement’. The Full Court considered the subsection against the backdrop of the principal object of the Act. That object was to provide a framework for cooperative workplace relations by, amongst other things, supporting fair and effective agreement making.
[63] The Full Court found that the subsection was plainly a sign or indication of the concern with the authenticity and, as it were, the moral authority of the certified agreement. While Gordonstone considered the term ‘must have genuinely made’ subsequent decisions of the Commission have continued to adopt its analysis when considering s 188(c) of the Act. The objects of Part 2-4 still speak of a fair framework albeit ‘simple’ and ‘flexible’ have been added to the mix as has the end product of an enterprise agreement that delivers productivity benefits.
[64] Ross VP, as he was then, considered Gordonstone in Grocon and went on in Grocon to quote the observations he had made in Re Toys “R” Us (Aust) Pty Ltd Enterprise Flexibility Agreement 1994 45regarding an application to approve an enterprise flexibility agreement under a different statutory regime46. Those observations were:
In my view the requirement that a majority of employees “genuinely agreed” to be bound by the agreement implies that the consent of the employees was informed and there was an absence of coercion.
Given the conclusion I have reached in relation to s 170NC(1)(h) it follows that I do not believe that the majority consent in this case was informed. The material supplied by the company to the employees did not fully disclose the impact of the agreement…
[65] In Grocon, Ross VP drew upon the decision in Coles Supermarkets Australia Pty Ltd v Shop, Distributive and Allied Employees Association 47where the Full Bench of the Australian Industrial Relations Commission said:
…The need to explain the terms of the agreement is both an explicit requirement of ss. 170LJ(3) and is implied in the concept of “genuine approval”. “Genuine” approval implies that the consent of the employees was informed, that they were advised of the consequences of giving their approval to the agreement 48.
[66] When determining whether there are no other reasonable grounds for believing that the enterprise agreement has not been genuinely agreed to, consideration of the authenticity of the enterprise agreement, its soundness 49, and whether the employees who will be covered by the enterprise agreement are informed of its terms so it can be said that their ‘consent’ is informed, are relevant circumstances to be considered.
[67] The use of the word ‘genuinely’ in the phrase ‘genuinely agreed’ in ss 186(2)(a) and 188(c) of the Act, indicates that mere agreement will not suffice and that consent of a higher quality is required 50.
[68] Paragraph 188(c) is cast in very broad terms 51. It is intended to pick up anything not caught by paras (a) and (b)52. Thus any circumstance which could logically bear on the question of whether the enterprise agreement of the relevant employees was genuine would be relevant53.
Reasonable steps to notify – vote
[69] The CFMMEU contended that Mammoet had not taken all reasonable steps to notify the relevant employees of the time and place at which the vote will occur, because the sending of an email to the ‘personal email address of each eligible employee’ 54 was patently not all reasonable steps.
[70] Section 180(3) requires that the employer take ‘all reasonable steps’ to provide the required notification. The meaning usually assigned to that expression was discussed in the decision of the Full Bench in Construction, Forestry, Mining and Energy Union v Australia Mining Supplies Company Pty Ltd 55. It was said that the expression ‘all reasonable steps’ in s 180(3) of the Act is to be interpreted as follows:
a) what is reasonable depends on the particular circumstances existing at the time the obligation arises, and is what a reasonable man or woman would regard as being reasonable steps in the circumstances;
b) what is considered to be reasonable steps does not extend to all steps that are reasonably open in some narrow or theoretical sense (such as, for example, matters not directly within the particular knowledge or experience of a relevant party); and
c) a failure to take a particular step has to be assessed by reference to its materiality to the failure to achieve the relevant object 56.
Consideration
[71] I have considered the evidence of Ms Liddicoat with regard to the method Mammoet chose to communicate to its employees. Ms Liddicoat explained this method with regard to the Notice of Employee Representational Rights:
[T]he reason that I sent the Notice to their personal email address is because when employees commence work with Mammoet they are asked to nominate the preferred email address for all work-related communications. This includes pay-slips, formal notices or memorandums, letters, and agreement-making information, and other work related information.
This email is inserted into the employee data system and this is the way that Mammoet communicates with its employees. For the following reasons, Mammoet has found that email is the best way to communicate with employees:
(a) employees work across Australia, in different time zones, on various rosters;
(b) employees may not be required to perform work from time to time between jobs and therefore may be at home and not have access to the workplace or any work emails;
(c) employees may be on leave; and
(d) employees often work on sites where they are not allowed to bring their mobile phones onto site, or where there is no mobile phone coverage.
Therefore, this is the primary and agreed method in place that is used by the company to communicate with its employees. I used this method to communicate with the relevant employees during the entire agreement-making process 57.
[72] Ms Liddicoat later gave evidence that on 24 October 2017 she:
sent an email to the personal email address of each relevant employee informing the employee of the voting instructions, and attaching the final version of the Agreement. My email included details of how to vote, the timing for the vote, being from 1 November 2017 to 2 November 2017, and the voting method to be used, being the CVS platform 58.
[73] Based on the evidence of Ms Liddicoat, I am satisfied that at the start of the access period Mammoet had taken all reasonable steps to notify the relevant employees of the time and date of the vote and the voting method.
[74] While the CFMMEU advanced there was no evidence of any additional follow up made to the relevant employees to ensure the notification was received, the test of whether ‘reasonable steps’ were taken should not be elevated to one requiring an applicant to ‘establish in a definitive way that all employees were in fact informed of the matters’ 59. The use of the personal email address was totally acceptable in the particular circumstances that were detailed by Ms Liddicoat. Both the business and the employees had accepted this method of communication, which was clearly evinced by the point that payslips were sent to the same address. Where there is an accepted and effective method of communicating within a business, I see no need for ‘all reasonable steps’ to require a deviation from that accepted method.
Explanation of the effect of the terms of the enterprise agreement
[75] Section 188 of the Act provides that an enterprise agreement has been genuinely agreed to by the employees covered by the enterprise agreement if the Commission is satisfied that the employer has complied with requirements set out in that section, including those in s 180(5) of the Act.
[76] Further s 180(1) of the Act requires that before an employer requests employees to approve an enterprise agreement by voting for it, the employer must comply with requirements including the requirement at s 180(5) that:
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.
[77] The issue at the heart of the requirement in s 180(5) of the Act is to ensure genuine and informed consent to the terms of the proposed enterprise agreement 60.
[78] Whether s 180(5) has been complied with involves an evaluative judgment 61. This is because the Commission must assess whether ‘reasonable steps were taken by the employer’62. Whatever steps may be necessary will depend upon the facts and circumstances of each particular case; but it has been found that those steps are not satisfied by a person reading – without explanation – the terms of an enterprise agreement to an employee63.
[79] In One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union (One Key) 64, Flick J found that ‘reasonable steps’ could include the identification of the particular Award which covered the relevant employees with particular reference to those provisions in the Awards that varied from, or did not vary from, the terms of the proposed enterprise agreement. It is relevant to observe that Flick J was proffering suggestion on what steps could have been taken to constitute ‘all reasonable steps’ in the circumstances of that particular case.
[80] On appeal, the Full Court in One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union Court Decision (One Key Full Court Decision) 65 found that a bare statement by an employer that an explanation had been given was an inadequate foundation upon which to reach a state of satisfaction for the purpose of s 180(5) of the Act. The Full Court said that the relevant considerations to which the Commission was bound to have regarded, was the content of the explanation provided and the terms in which it was conveyed66. The Full Court went on to say:
The agreed purpose of the obligation imposed on employers by s 180(5) is to enable the relevant employees to cast an informed vote: to know what it is they are being asked to agree to and to enable them to understand how wages and working conditions might be affected by voting in favour of the agreement 67.
…
To construe that requirement as mandating an informed and genuine understanding of what is being approved is consistent with the text of the provision (as defined) and accords with its underlying purpose 68.
[81] The emphasis in the One Key Full Court Decision was on the employee’s understanding of the terms and conditions provided in the enterprise agreement and their effect. Regard therefore must be had to the content and terms of the explanation the employer provided to the employees before they cast their votes. In addition, in determining whether the relevant employees had genuinely agreed to the enterprise agreement, the Commission must consider whether the relevant employees were likely to have understood its terms and effect 69.
[82] In McDonalds Australia Pty Ltd70 a Full Bench held, in relation to s 180(5) that the test is not an absolute requirement to ensure that particular outcomes are achieved, and that the section requires only that the employer take reasonable steps to ensure the terms and conditions are explained to employees. There is no requirement in s 180(5) for there to be a full explanation of the terms of an enterprise agreement prior to the employer requesting employees to vote on an enterprise agreement 71. The section does not preclude employers providing explanations during the access period and subsequent explanations can be provided.
[83] The term ‘reasonable’ is usually considered within the context of ‘reasonable in all of the circumstances of the case’, and the real question is to determine what circumstances are relevant 72.
[84] In the decision of Glen Eden Thoroughbreds Pty Ltd T/A Ray White Shailer Park 73 it was said that the reasonableness of the steps taken should be considered in the context of the size of the enterprise, the demographics of the employees to whom the explanation is provided, the type of work performed by employees and whether the proposed terms of the enterprise agreement are new or unusual in the context of the enterprise concerned and the particular employment relationship74.
Consideration
[85] The Form F17 75 at question 2.6 set out the steps taken by Mammoet to explain the terms of the enterprise agreement, and the effect of those terms, to the relevant employees. Mammoet provided the following response:
The Human Capital Manager and Managing Director had face to face meetings with each eligible employee both individually and as a group to go through each clause of the proposed Agreement and how the proposed Agreement was to apply to the employee.
[86] Ms Liddicoat gave further evidence that Mr Vincent Vingerhoeds, Business Development Manager, had face to face meetings with the four employees in relation to the terms of the Mammoet Agreement 76. Queries were raised by the four employees and in response Ms Liddicoat said:
…on 19 October 2017, I sent a copy of the new draft Agreement which showed the changes to the previous Ararat Agreement for the employee’s reference.
This was intended to transparently show to the employees what was new in the proposed Agreement compared to their previous terms. I had understood from Vince that the employees wanted to understand these differences. In my email, I also asked the employees if they had any questions to please let me know.
One employee had been part of the agreement making process for the Ararat Agreement, and the other 3 had been employed on the Ararat project. A number of employees had made various payroll and other queries related to their entitlements under the Ararat Agreement.
Based on this, and their request to understand the differences from the Ararat Agreement, I understood that the employees were familiar with and understood the terms and conditions that had applied to them whilst working under the Ararat Agreement.
I therefore made the decision that it was most efficient to explain the new Agreement by reference to the instrument with which they were familiar and had most recently applied to them.
Additionally, also in response to Vincent’s visit and discussions with employees, a phone conference was arranged for the employees to ask questions in relation to the terms of the proposed Agreement. 77
[87] The Ararat Agreement referred to in the evidence of Ms Liddicoat was the Mammoet Wind Pty Ltd and Ararat Wind Farm Project Agreement 2016 (Ararat Agreement) that had a nominal expiry date of 1 June 2015. Ms Liddicoat gave further evidence that at some point she conducted a telephone conference with all four employees in which she went through their questions and gave feedback 78, the questions asked and answers provided were detailed. On 24 October 2017, Ms Liddicoat sent to the four employees, mock payslips in response to queries from the employees on the new rates schedule in the Mammoet Agreement79. The mock payslips were intended to assist the four employees to understand what their take home pay would be if the Mammoet Agreement was approved and commenced operation80.
[88] Mindful that a relevant consideration to which the Commission must have regard to includes the content of the explanation provided and the terms in which it was conveyed 81, on 6 June 2018, Mammoet was directed to file with the Commission any explanatory documentation that was provided to the relevant employees.
[89] In One Key 82, Flick J identified that the ‘missing’ element from the explanation provided was ‘any guidance… as to the manner which the Agreement affected [the relevant employees’] personal interests’83. In the One Key Full Court Decision it was emphasised that consideration must be had to whether the relevant employees were likely to have understood the terms of the enterprise agreement and their effect84.
[90] The CFMMEU said that it was wrong for Mammoet to claim that it was not necessary to advise employees of provisions that were less beneficial than the Award, if at the time of approval those provisions did not apply directly to them, and to assume knowledge of an enterprise agreement based on an employee being employed under its terms and conditions.
[91] However, the evidence of Ms Liddicoat was not simply such that she sent through a marked-up version of the Mammoet Agreement. Her evidence was that she took the relevant employees through the changes to the Ararat Agreement (the basis of which later formed the Mammoet Agreement) in detail, and responded to any queries the employees raised.
[92] I am satisfied that in the circumstances of this case that the impact on the relevant employees’ interests was clearly addressed by Mammoet’s explanations in its discussions with the relevant and employees, the provision of a marked up Ararat Agreement and by the provision of mock payslips. The approach is pragmatic, transparent and takes into account the circumstances of the employees all of whom had worked on the Ararat project. It was apparent that such employees were sufficiently positioned to ask incisive questions regarding the effect of the Mammoet Agreement terms 85. This is unsurprising given the description that all formed part of a core crew of long-standing employees and possessed a highly specialised skill set beyond those of an ordinary crane operator86. I have concluded that the relevant employees provided informed consent.
[93] In the circumstances, I am satisfied that there is nothing unreasonable about the employer providing the relevant employees with a marked up copy of the Ararat Agreement and then inviting them to ask questions about its terms at a series of meetings. It is not the case that an employer is to provide an explanation that specifically addresses each and every term of an enterprise agreement in forensic detail 87. What is required is that the employer takes all reasonable steps to provide an explanation88.
Less beneficial terms
[94] It was said by the CFMMEU that there were two terms of the Mammoet Agreement that were less beneficial than the Mobile Crane Award 89. The first concerned the types of employment under clause 13 of the Mammoet Agreement and the second, the provision of a redundancy benefit under clause 17 of the Mammoet Agreement.
[95] Clause 13 of the Mammoet Agreement provides for a type of employment termed ‘Daily hire Employee’ and clause 14 of the Mammoet Agreement explains that a ‘daily hire Employee’ means an employee engaged subject to the following provisions:
1) One day’s notice of termination of employment will be given on either side or one day’s pay will be paid or forfeited.
2) Notice given at or before the usual starting time of any ordinary working day will expire at the completion of that day’s work.
3) Nothing in this clause will affect the right of the Employer to dismiss an Employee without notice for misconduct or refusing duty.
…
Notice provisions under the NES, as described by Clause 16.2 do not apply to Daily Hire Employees.
[96] The CFMMEU submitted that the Commission cannot be satisfied that Mammoet discharged its obligation to ‘take all reasonable steps’ as envisaged by s 180(5) because it did not identify with the employees the less beneficial terms when compared to the Mobile Crane Award, or the variations of terms compared to the Mobile Crane Award.
[97] Ms Liddicoat’s evidence was that she did not consider that the Mammoet Agreement had less beneficial terms than the Mobile Crane Award 90, and that Mammoet had never engaged daily hire employees91.
[98] Concerning its first contention about the less beneficial term the CFMMEU states that clause 13 of the Mammoet Agreement provides for daily hire and full-time employment whereas the Mobile Crane Award has only full-time weekly hire and casual employment. The CFMMEU makes no mention that the Construction Award provides for a daily hire type of employment at clause 10.1 and clause 11 states:
A daily hire employee means a tradesperson or labourer engaged subject to the following provisions:
11.1 One day’s notice of termination of employment will be given on either side or one day’s pay will be paid or forfeited.
11.2 Notice given at or before the usual starting time of any ordinary working day will expire at the completion of that day’s work.
11.3 A tradesperson will be allowed one hour prior to termination to gather, clean, sharpen, pack and transport tools.
11.4 Nothing in this clause will affect the right of an employer to dismiss an employee without notice for misconduct or refusing duty.
[99] There is little difference between clause 14 of the Mammoet Agreement and clause 11 of the Construction Award save that there is no provision under the enterprise agreement for gathering tools. And while the Mobile Crane Award may be absent an employment type of ‘daily hire’, I have taken into consideration Ms Liddicoat’s evidence about no employee being engaged under that employment type and an intention not to deviate from such practice. Therefore, I consider that there is satisfactory reason why Ms Liddicoat did not consider clause 13 a less beneficial term and her absence of referencing it in her statutory declaration has not rendered the statutory declaration at odds with the real position, as was submitted by the CFMMEU.
[100] Clause 17 of the Mammoet Agreement regarding redundancy was said by the CFMMEU to be an entitlement that was less than the Mobile Crane Award and it follows should have been referenced in Ms Liddicoat’s statutory declaration.
[101] Clause 17.3 of the Mammoet Agreement provided that a redundant employee would receive redundancy payments as per the Act and clause 4.2 provided that the National Employment Standards would apply to employees covered by the Mammoet Agreement except where the Mammoet Agreement provided a more favourable outcome.
[102] At clause 17.2 of the Mammoet Agreement it was said that the National Employment Standards did not apply to employees employed under the Mammoet Agreement regarding redundancy payment as an industry-specific redundancy scheme in a modern award applied. At clause 17.8 reference is made to a redundancy payment being an amount whichever is the greater of the entitlement due under the Award (Mobile Crane Award) or the entitlement of the employee under the named trust deed.
[103] It is noted that the Construction Award at clause 17 similarly provides for an industry-specific redundancy scheme, although not in the same terms as the Mobile Crane Award, it is generous when compared to the equivalent entitlement under the National Employment Standard.
[104] Given the content of the Mammoet Agreement as detailed in the preceding paragraphs regarding redundancy payment, I am satisfied Ms Liddicoat’s statement that the Mammoet Agreement did not include less beneficial terms was reasonable given express reference in the Mammoet Agreement to a redundancy benefit in accordance with the ‘Award’.
[105] With regard to s 180(5) of the Act, I am satisfied that Ms Liddicoat did not provide an incorrect or misleading explanation in relation to these terms and there was no explanation that these terms were more beneficial. In the circumstances of this particular case, I do not consider that the absence of reference to cl 13 and cl 17 of the Mammoet Agreement in the Form 17 renders the steps taken by Mammoet, to ensure the terms of the enterprise agreement and its effect are explained, deficient 92.
Fairly chosen
[106] Sections 186(3) and (3A) of the Act provide respectively:
The FWC must be satisfied that the group of employees covered by the agreement was fairly chosen.
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.
[107] In Construction, Forestry, Mining and Energy Union v John Holland Pty Ltd 93, the Full Court stated:
It is apparent therefore that, depending on the time in the life of the enterprise (including a project) that an agreement is proposed, there may be a very small number of employees with whom an agreement may be made. It was possible, legally, for an agreement to be made with as few as three employees as John Holland proposed 94.
…
There is no requirement that employees who vote to make an agreement must have been in employment for any length of time, and there is no requirement that they remain in employment after the agreement is made. Presumably, the presently employed members of such a group will act from self-interest, rather than from any particular concern for the interests of future employees. The potential for manipulation of the agreement-making procedures is, accordingly, a real one. However, no suggestion of that kind is made in the present case and the possibility may therefore be put to one side for the purpose of discussion. That is an important consideration because it suggests, as the primary judge thought, that determination of whether the group of employees was fairly chosen in the present case needed to bring to account the business rationale for the choice, as well as deal with any possibility of unfair exploitation. It was not irrelevant in that assessment to bear in mind, as the primary judge said, that the agreement provided benefits, not detriments, for those to whom it would apply 95.
[108] In Thiess Pty Ltd v Construction, Forestry, Maritime, Mining and Energy Union (Theiss) 96, the Full Bench of the Commission cited with approval the principles concerning the operation of ss 186(3) and (3A) of the Act, which had been summarised by the Full Bench in Aerocare Flight Support Pty Ltd t/a Aerocare Fight Support v Transport Workers’ Union of Australia; Australian Municipal, Administrative, Clerical and Services Union97. I have had regard to those summarised principles when arriving at my finding.
Consideration
[109] The CFMMEU submitted that Mammoet had provided no explanation as to why it sought an enterprise agreement with national coverage with only four current employees. Further it contended that at the very least it needed to explain the organisation and the rationale for the scope and coverage of the Mammoet Agreement.
[110] The group of employees covered by the enterprise agreement in s 186(3) refers to the whole class of employees to whom the enterprise agreement might in future apply. In this case that class of employees covers the employees who fall within the classification structure at Appendix A of the Mammoet Agreement. The choice is that made by the employer 98.
[111] Mammoet is involved in an industry that involves the construction and installation of wind farms and turbines in Australia. It is apparent from the evidence of Ms Liddicoat that from the time that the work is awarded, employees are frequently mobilised within a short period 99. If follows that there appears to be a legitimate and sound commercial imperative to have a pool of specialised crane operators and supporting classifications to perform wind project work in a manner that is responsive to the market in which Mammoet operates nationally; hence why this part of the business is referred to as the Wind Division and its highly skilled employees are retained between project works and form the core crew on any further projects that are secured100.
[112] It is observed that there is nothing inherently improper concerning an employer negotiating an enterprise agreement with a small number of employees where it knows that a larger group of employees may be engaged in the near future 101. It appears clear that where there presently exists only a small start-up workforce for a larger planned but contingent project, and there is no valid suggestion of artifice or concoction in the creation of that group and the start-up workforce are materially connected to the work of that project and are a part or an intended part of the project the Commission cannot:
deny those employees the capacity to make an agreement capable of receiving approval by mere unexplained and unjustified assertion that the composition of the start-up workforce has been manipulated and that their agreement is not genuine for that reason 102.
[113] The Wind Division undertakes specialised work particular for wind projects and requires only a small number of cranes 103. The circumstances are not such that Mammoet has, since the Mammoet Agreement was made, employed numerous employees in a diverse range of industries104. There are two relevant Awards for the purpose of the BOOT, classifications that appear on their face limited to those required in the construction and installation of wind farms albeit admittedly I am not an expert on wind farm construction, and since the enterprise agreement was made 27 employees have been employed to whom the Mammoet Agreement applies105.
[114] The CFMMEU has advanced that the Mammoet Agreement raises concerns of authenticity on the face of the Application, and that there is the serious potential for ‘manipulation of the agreement-making process’. It provides nothing helpful thereafter regarding this assertion. There is uncontroverted evidence before me that there is a defensible business rational for the Mammoet Agreement and its respective coverage.
[115] I am therefore satisfied that there is no clear or compelling evidence that supports a finding or inference that Mammoet manipulated, or effectively misconducted itself in relation to the making of the Mammoet Agreement by manipulation of the group to be covered by the Mammoet Agreement 106. The selection of the group of employees appears neither arbitrary, contrived nor discriminatory.
[116] On the evidence before me I cannot be certain that the Mammoet Agreement covers all the employees of Mammoet and therefore I have considered it necessary to take into account whether the group is geographically, operationally or organisationally distinct when deciding if the group of employees was fairly chosen 107. However, I observe that such a consideration is not definitive when arriving at a decision on whether the group of employees was fairly chosen108.
[117] The meaning or organisational and operational distinctiveness was discussed by the Commission in the following terms:
In relation to ground two of the appeal, we are of the view that the Commissioner has treated the performance of a different role, task, skill or function as operational distinctiveness and has erroneously concluded that the group of employees is operationally distinct on that basis. The term “operational” refers to an industrial or productive activity – here the operation and maintenance of gas extraction and processing infrastructure in the Surat Basin in Queensland. The term “organisation” refers to the manner in which the employer has organised its enterprise in order to conduct those operations. The fact that Gas Plant Operators and Gas Plant Lead Operators perform a different role, task or function to that performed by other operators is not of itself a sufficient basis upon which a finding of operational or organisational distinctiveness can be made in the circumstances of the present case 109.
[118] The Full Bench in Thiess provided a simple example to demonstrate organisational distinctiveness in the context where employees within the business worked on different projects but their work was not materially different:
An employer may be conducting its business in the commercial building and civil construction sectors. It may for instance employ a number of engineers. Organisationally the employer conducts and organises the commercial building aspect of its business separately from the civil construction aspect of its business. It assigns some of its engineers to perform their work exclusively for civil construction projects while others are assigned to perform exclusively for commercial building projects undertaken by the employer. The work performed by engineers in both settings is not materially different yet there will be little doubt that one group of engineers is organisationally different from the other 110.
[119] Mammoet created a division within its organisation to cater purely for the construction and installation of wind farms and turbines across Australia. I am satisfied that the Wind Division is organisationally distinct observing further that there is no evidence before me to suggest otherwise. The relevant employees work within the Wind Division and are mobilised with very specific projects in mind, namely wind farm and turbine installation.
[120] The distinctiveness of the Wind Division in the circumstances of this matter arises from what is said to be the specialised nature of the work on wind projects 111, the requirement for only a small number of cranes on the projects112, and the specialised skill set of the crane operators113. Having been in her role for some nine years, I consider that Ms Liddicoat is amply well positioned to provide reliable evidence on the matter.
[121] The CFMMEU has challenged the authenticity of the Mammoet Agreement, at least in part, because the employees were not ‘fairly chosen’ and there was an issue regarding national ‘coverage’. However, I am satisfied that neither are an issue and do not preclude the Mammoet Agreement from being approved.
Other reasonable grounds for believing the enterprise agreement was not genuinely agreed
[122] The CFMMEU submitted that there were a number of provisions less beneficial than the Mobile Crane Award, namely two, and these were not listed in the Statutory Declaration (Form F17). It followed, according to the CFMEU that it could not be said that the Mammoet Agreement was genuinely agreed for the purposes of ss 186(2)(b) and 188(a)(i) of the Act.
[123] Reference was made to the decision in Construction, Forestry, Mining and Energy Union v Shamrock Civil Pty Ltd 114 (Shamrock). Having had due regard to Shamrock, it is not the case in this matter that there are a significant number of less beneficial terms. Further, one of the terms that was identified by the CFMMEU as less beneficial, and in this respect I refer to cl 13 of the Mammoet Agreement, was coloured by such complexity that one may forgive a Human Resources practitioner for omitting that particular clause from this section. My conclusion is not that this omission regarding cl 13 and cl 17, means that the content of the statutory declaration is untrue and I do not consider there to be a conceivable concern as to the nature of the explanation provided to the relevant employees.
[124] The Full Bench of this Commission has recognised that there will be some circumstances when an applicant incorrectly answers question 3.4 and/or question 3.5 of the Form 17 because they have omitted one or some items from the list 115. However, when such omissions are not particularly significant than this may not necessarily be a cause for concern116. This is one such occasion, and I am not satisfied that there is such discord between the factual situational and the responses in the relevant parts of the Form 17 that would warrant a conclusion that the enterprise agreement was not genuinely agreed.
[125] Mammoet provided information that it was not aware of any other enterprise agreements that had been dealt with by the Commission that had substantially identical terms. The CFMMEU submitted ‘this is surprising given that the format and content mirrors the provisions of the Mammoet Wind Pty Ltd and Ararat Wind Farm Agreement 2016 117. The CFMMEU did not advance its point further. Ms Liddicoat gave evidence that the tracked changes she had made to the document, meaning the Ararat Agreement, were sufficient to treat the Mammoet Agreement as not ‘identical or substantially identical’ to any other enterprise agreements118.
[126] I have had regard to the document that was based on the Ararat Agreement inclusive of tracked changes, which formed the draft Mammoet Agreement, and the response that was provided at 1.3 of the Statutory Declaration (Form 17). To determine whether an enterprise agreement is substantially identical in its terms to another that has been filed or dealt with by the Commission inevitably requires a judgment by the person completing the Statutory Declaration. Ms Liddicoat clearly considered that the changes made to the Ararat Agreement were sufficient such that the Ararat Agreement was not substantially identical to the Mammoet Agreement 119.
[127] While I am of the view that the Mammoet Agreement was substantially similar to the Ararat Agreement, I do not consider that the absence of a ‘yes’ on the Statutory Declaration was such that misinformation was provided. I consider that the explanation of Ms Liddicoat was a plausible justification for the omission of a ‘yes’. Further, in the circumstances of this matter, I do not consider that the response to 1.3 of the Statutory Declaration assists me in determining whether the Mammoet Agreement was genuinely agreed in the circumstances of this matter.
The Act - BOOT
[128] Under s 186(2)(d) of the Act the Commission must be satisfied that an enterprise agreement passes the better off overall test before it can approve the enterprise agreement.
[129] Section 193(1) of the Act sets out that:
[A]n enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if 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.
[130] Reference is made in s 193(1) to a ‘test time’. Section 193(6) of the Act specifies that the ‘test time’ is the time the application for approval of the enterprise agreement by the Commission was made under s 182(4) or s 185.
[131] An assessment by the Commission as to whether an enterprise agreement satisfies the BOOT is not a line-by-line comparison or a comparison to one discrete term in an Award to its corresponding term (or its absence) in the enterprise agreement 120. Rather it requires an overall assessment to be made. This requires the 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 enterprise agreement121. However, this consideration does not require an assessment of the circumstances of each individual employee. The Full Bench in National Tertiary Education Industry Union v University of New South Wales122 stated:
This consideration does not require an assessment of the circumstances of each individual employee but, as s.193(7) allows, “... if a class of employees to which a particular employee belongs would be better off if the agreement applied to that class than if the relevant award applied to that class, FWA is entitled to assume, in the absence of evidence to the contrary, that the employee would be better off overall if the agreement applied to the employee”.
As His Honour was well aware the Agreement contained some provisions which may be considered inferior to the counterparts provision in the Awards and provisions which were superior. There is nothing unusual about that. What he needed to satisfy himself of was whether, weighing the Agreement provisions as a whole with those in the Awards, an employee is better off overall. This, in our opinion, is clearly what His Honour did [footnotes omitted].
Consideration
[132] With regard to those classifications in the Mammoet Agreement for which the comparators are the classifications in the Mobile Crane Award, I have observed that for the weekly hire employees the percentage difference is at its lowest 12.80% for a Trades Assistant/Labourer and extends to a high of 46.70% for a Crane Operator 0-600T.
[133] Regarding the classifications of Truck and Transport Mechanic, and Crane Specialist Mechanic, when compared to the relevant classification under the Construction Award, it is abundantly evident that the rates sit well above the Construction Award rates.
[134] It has been observed that while the Mammoet Agreement includes a daily hire employment type the Mobile Crane Award does not make such provision although the Construction Award at cl 11 does. The Construction Award sets out:
11. Daily hire employees
A daily hire employee means a tradesperson or labourer engaged subject to the following provisions:
11.1 One day’s notice of termination of employment will be given on either die or one day’s pay will be paid or forfeited.
11.2 Notice given at or before the usual time of any ordinary working day will expire at the completion of the day’s work.
11.3 A tradesperson will be allowed one hour prior to termination to gather, clean, sharpen, pack and transport tools.
11.4 Nothing in this clause will affect the right of an employer to dismiss an employee without notice for misconduct or refusing duty.
[135] In Construction, Forestry, Mining and Energy Union v SESLS Industrial Pty Ltd 123, the Full Bench observed that in that case the BOOT had a peculiar complexity because there was an inability to compare like to like given that the relevant Award did not permit casual employment for production and engineering employees, but the proposed enterprise agreement in question did. Similarly, in this case the Mobile Crane Award contemplates casual employment but not that of daily hire. I am unpersuaded that the absence of a daily hire employment type in the Mobile Crane Award means that the employees and prospective award covered employee(s) would not be covered by the Mobile Crane Award, if falling under the coverage provision in cl 4 and the relevant classification in Schedule B124. The question that then arises is that of the relevant comparator.
[136] I am prepared to accept given the characteristics of a daily hire arrangement, and acknowledging the absence of this type of employment in the Mobile Crane Award, that this type of employment in some respects mirrors that of a ‘casual’ type of employment more than it does the other type of employment contemplated under that particular Award. Therefore, I am satisfied that the relevant comparator would be that of the ‘casual’ type of employment under the Mobile Crane Award.
[137] The essence of the CFMMEU’s concern is that the Mobile Crane Award contemplates only full-time weekly hire and therefore those employees who are not full-time weekly hire would otherwise be entitled under the Mobile Crane Award to 25% casual loading and conversion to permanent employment after 6 months 125. In contrast, the Mammoet Agreement provides for daily hire that permits employment on permanent rates and does not provide for conversion to permanent employment.
[138] Mammoet has sought to address the concern raised by the CFMMEU by the provision of a draft undertaking on 4 April 2018 in the following terms:
Mammoet Pty Ltd undertakes that in the event it employs any daily-hire employees who are covered by the Agreement, the daily hire employees will be engaged on rates specified in the applicable Award, plus a 25% loading.
[139] A further revised version of the aforementioned undertaking was provided on 27 June 2018 in the following terms:
Mammoet Pty Ltd undertakes that in the event it employs any daily hire employees who are covered by the Agreement, the daily hire employees will be engaged on the rates specified in the Agreement, plus a 25% loading.
[140] The CFMMEU on 27 June 2018 continued to press its objection to the revised undertaking regarding daily hire employees, advancing that because the undertaking did not address the entitlement to elect to convert to full-time employment after 6 months the relevant employees would not be better off overall. However, Mammoet submitted that it does not employ daily hire employees and is very unlikely to do so. Given that I am required to conduct an overall assessment rather than a line by line approach I do not consider that the absence of the conversion clause renders the Mammoet Agreement such that it fails to satisfy the BOOT given the overall benefits provided. I am cognisant that those employees, who otherwise would be covered by the Construction Award, would not as daily hire employees attract a 25% loading.
[141] The BOOT expressly requires that the employees be ‘better off’ under the Mammoet Agreement compared to the relevant Award 126. Reference has been made to the entitlement in clause 17 regarding redundancy being less beneficial when compared do the Mobile Crane Award. To address this concern Mammoet provided the following draft undertaking:
To avoid any possible confusion on the part of employees, Mammoet Pty Ltd undertakes that in the event that an employee’s employment is terminated for reasons of redundancy, any benefits on termination will be in accordance with the more favourable of the Agreement, any applicable Award, or the National Employment Standards.
[142] Having been invited to provide their view on the draft undertaking regarding clause 17 of the Mammoet Agreement the CFMMEU had nothing further to add.
[143] I have found that the BOOT is not satisfied in relation to the Mammoet Agreement. However, I am otherwise satisfied that the requirements of the Act have been met in relation to the application for approval.
[144] I am prepared to accept the undertakings put forward by Mammoet in relation to the BOOT and am satisfied that concerns have been addressed. An undertaking sought under s 190 should in my view be confined to that which is sufficient to address the Commission’s concern and should not be made the occasion for imposing limitations or additional benefits which go beyond meeting that concern. However, where the case is such that the undertaking advanced by the employer provides an additional benefit which goes beyond meeting the Commission’s concern and the employer is fully apprised that the undertaking provides such additional benefit, then I am content to proceed on that basis.
DEPUTY PRESIDENT
<AE429339 PR609479>
ANNEXURE A
1 Witness Statement of Jayne Liddicoat dated 9 April 2018 [10].
2 Ibid [9].
3 Ibid [10].
4 Ibid [11].
5 Ibid.
6 Ibid [12].
7 Ibid [13].
8 Ibid.
9 Ibid.
10 Ibid [14].
11 Ibid.
12 Mammoet Wind Pty Ltd and the CFMMEU Mobile Crane Hire Industry Enterprise Agreement 2011-2015; Boco Rock Windfarm Project Agreement 2014; Mammoet Wind Pty Ltd and Ararat Wind Farm Project Agreement 2016 (Ararat Agreement); Mammoet Wind Pty Ltd White Rock Wind Farm Project Agreement 2017.
13 Witness Statement of Jayne Liddicoat dated 9 April 2018 [17].
14 Ibid [19].
15 Employer’s statutory declaration in support of an application for approval of an enterprise agreement (other than a greenfields agreement)
16 cl. 2 Mammoet Agreement.
17 PR609464.
18 Submissions of the CFMMEU [3].
19 Ibid.
20 Ibid [4a].
21 Ibid [4b].
22 Ibid [2].
23 Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited[2014] FWCFB 7940 [16].
24 Ibid [72].
25 Ibid [48] and [75].
26 Ibid [48].
27 [2017] FWCA 2817.
28 Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited[2014] FWCFB 7940 [48] and [60].
29 Paragraph 4(d) of the CFMMEU’s submissions dated 26 March 2018.
30 [2014] FWCFB 8429 [6] and [7].
31 [2014] FWCFB 7940 [48]
32 Inco Ships Pty Ltd v The Australian Institute of Marine and Power Engineers and The Australian Maritime Officers’ Union[2016] FWCFB 3370 [15].
33 Paragraph 4(b), (c), (e) and (f) of the CFMMEU’s submissions dated 26 March 2018.
34 Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited[2014] FWCFB 7940 [48] and [75].
35 Paragraph 3 of the CFMMEU’s submissions dated 26 March 2018.
36 Witness Statement of Jayne Liddicoat dated 9 April 2018 [24] – [25].
37 Ostwald Bros Pty Ltd v Construction, Forestry, Mining and Energy Union[2012] FWAFB 9512 [52].
38 Ibid [78].
39 Ibid[54].
40 Section 188(c).
41 [2016] FWCFB.
42 [2015] FWC 1554.
43 [1999] FCA 847.
44 (2003) 127 IR 13.
45 Print L9066.
46 (2003) 127 IR 13.
47 Print T2319.
48 Ibid [20].
49 See Central Queensland Services Pty Ltd T/A BHP Billiton Mitsubishi Alliance [2015] FWC 1554 [65]; Ostwald Bros Pty Ltd v CFMMEU [2012] FWAFB 9512 [154] Watson VP (dissenting); KCL Industries Pty Ltd; KCL Industries Pty Ltd [2016] FWCFB 3048 [29].
50 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [141].
51 Ibid [142].
52 Ibid.
53 Ibid.
54 Witness Statement of Jayne Liddicoat dated 4April 2018 [27].
55 Construction, Forestry, Mining and Energy Union v Australia Mining Supplies Company Pty Ltd [2017] FWCFB [14].
56 Ibid, citing Maritime Union of Australia v Northern Stevedoring Services[2016] FWCFB 1926.
57 Witness Statement of Jayne Liddicoat dated 9 April 2018 [28] – [30].
58 Ibid [44].
59 Re MSS Security Pty Limited[2013] FWCA 1474 [41].
60 Coles Supermarkets Australia Pty Ltd v Shop, Distributive and Allied Employees Association Print T2319 [20].
61 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [105].
62 Ibid.
63 Ibid [103].
64 [2017] FCA 1266 [105].
65 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [112].
66 Ibid.
67 Ibid [115].
68 Ibid [156].
69 Ibid [172].
70 [2010] FWAFB 4602.
71 Ibid.
72 Opera House Investment Proprietary Limited v Devon Buildings Pty Ltd (1936) 55 CLR 111 at 116.
73 [2010] FWA 7217.
74 Ibid.
75 Employer’s statutory declaration in support of an application for approval of an enterprise agreement (other than a Greenfields agreement)
76 Witness Statement of Jayne Liddicoat dated 9 April 2018 [31] – [32].
77 Ibid [33] – [38].
78 Ibid [39].
79 Ibid [40].
80 Ibid.
81 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [113].
82 [2017] FCA 1266.
83 Ibid [105].
84 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [168].
85 Witness Statement of Jayne Liddicoat dated 9 April 2018 [13] and [14].
86 Ibid.
87 [2010] FWA 7217 [77].
88 Ibid.
89 Paragraph 26 of the CFMMEU’s submissions dated 26 March 2018.
90 Witness Statement of Jayne Liddicoat dated 9 April 2018 [56].
91 Ibid [55].
92 Construction, Forestry, Mining and Energy Union v Kaefer Integrated Services Pty Ltd[2017] FWCFB 5630 [44].
93 [2015] FCAFC 16.
94 Construction, Forestry, Mining and Energy Union v John Holland Pty Ltd [2015] FCAFC 16 [16].
95 Ibid [33].
96 [2018] FWCFB 2405 [22] – [28].
97 [2017] FWCFB 5826.
98 [2018] FWCFB 2405 [23].
99 Witness Statement of Jayne Liddicoat dated 9 April 2018 [11].
100 Ibid [13].
101 Maritime Union of Australia, The v Toll Energy Logistics Pty Ltd[2015] FWCFB 7272 [70].
102 Theiss Pty Ltd v Construction, Forestry, Maritime, Mining and Energy Union[2018] FWCFB 2405 [63] citing Aldi Foods Pty Ltd v Shop, Distributive and Allied Employees Association [2017] HCA 53 [25].
103 Witness Statement of Jayne Liddicoat dated 9 April 2018 [14].
104 Cf Construction, Forestry, Mining and Energy Union v One Key Workforce Pty Ltd [2017] FCA 1266.
105 Witness Statement of Jayne Liddicoat dated 9 April 2018 [16].
106 Thiess Pty Ltd v Construction, Forestry, Maritime, Mining and Energy Union [2018] FWCFB 2405 [31].
107 Section 186 (3A) of the Act.
108 Thiess Pty Ltd v Construction, Forestry, Maritime, Mining and Energy Union [2018] FWCFB 2405 [26].
109 Ibid [32] referring to QGC Pty Ltd v Australian Workers’ Union [2017] FWCFB 1165 [44].
110 Thiess Pty Ltd v Construction, Forestry, Maritime, Mining and Energy Union [2018] FWCFB 2405 [33].
111 Witness Statement of Jayne Liddicoat dated 9 April 2018 [14].
112 Ibid [16].
113 Ibid [14].
114 [2018] FWCFB 1772.
115 Construction, Forestry, Mining and Energy Union v Shamrock Civil Pty Ltd [2018] FWCFB 1772 [33].
116 Ibid.
117 [2016] FWCA 4130; Submissions of the CFMEU [33].
118 Witness Statement of Jayne Liddicoat dated 9 April 2018 [52].
119 Ibid.
120 National Tertiary Education Industry Union v University of New South Wales[2011] FWAFB 5163.
121 Armacell Australia Pty Ltd and Ors [2010] FWAFB 9985 [41]; Solar Systems Pty Ltd [2012] FWAFB 6397.
122 [2011] FWAFB 5163.
123 [2017] FWCFB 3659.
124 Construction, Forestry, Mining and Energy Union v SESLS Industrial Pty Ltd[2017] FWCFB 3659 [34].
125 Cl 10.3(c) Mobile Crane Hiring Award 2010.
126 Aldi Foods Pty Limited as General Partner of Aldi Stores (A Limited Partnership) v Shop, Distributive & Allied Employees Association & Anor [2017] HCA 53 [93].
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