[2016] FWC 3887

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739 - Application to deal with a dispute

Maritime Union of Australia
v
Skilled Offshore (Australia) Pty Ltd
(C2016/4085 and C2016/4086)

COMMISSIONER CLOGHAN

PERTH, 24 JUNE 2016

Deal with a dispute pursuant to s.739 and the seeking of an order pursuant to s.533.

[1] On 10 June 2016, the Maritime Union of Australia (MUA) made applications to the Fair Work Commission (Commission) to:

• deal with a dispute in accordance with a dispute settlement procedure (DSP) pursuant to s.739 of the Fair Work Act 2009 (FW Act) (C2016/4085); and

• an order pursuant to s.532(1) of the FW Act (C2016/4086).

[2] The Respondent in both applications is Skilled Offshore (Australia) Pty Ltd (SKO).

[3] The applications were the subject of a conference on 11 June 2016 but remained unresolved.

[4] On 14 June 2016, the MUA provided SKO and the Commission an amendment to application C2016/4085.

[5] Application C2016/4085 is referred to the Commission pursuant to the Offshore Marine Services Pty Ltd Integrated Ratings, Cooks, Caterers and Seafarers (Offshore Oil and Gas) Enterprise Agreement 2010 (SKO Agreement).

[6] At the hearing into the applications, the MUA was represented by Mr S Crawshaw SC of Counsel and evidence given on behalf of the MUA by Mr A Evans, Deputy Branch Secretary, Western Australia.

[7] The Respondent was represented by Mr J Blackburn SC of Counsel and evidence given by Mr S J (Jim) Caldwell, Executive General Manager Operations.

[8] At the conclusion of the hearing, I declined SKO’s request for the Commission to provide an ex tempore decision but indicated that I would provide a decision and reasons for decision within seven (7) days.

RELEVANT CORPORATE BACKGROUND

[9] SKO provides marine labour services to vessels.

[10] SKO was a subsidiary of SKILLED Group Limited.

[11] On 16 October 2015, Programmed Maintenance Services Limited acquired all the shares of SKILLED Group Limited.

[12] SKO is now trading as Programmed Marine.

[13] Programmed Marine Pty Ltd is a subsidiary of Programmed Maintenance Services Limited.

[14] Programmed Marine Pty Ltd also trades as Programme Marine.

[15] While SKO and Programmed Marine Pty Ltd are discrete and separate legal entities, both trade as Programmed Marine.

[16] I shall refer to Skilled Offshore (Australia) Pty Ltd as SKO. I shall refer to Programmed Marine Pty Ltd as Programmed Marine Pty Ltd. It should be noted that employer representatives will be referred by either name or title because as occupants of the positions, they have a role and responsibility for both SKO and Programmed Marine Pty Ltd.

Further, because both entities trade under the name Programmed Marine, I have avoided referring to the trading name because of the confusion between Programmed Marine Pty Ltd, Programme Marine Pty Ltd trading as Programmed Marine and SKO trading as Programme Marine.

RELEVANT BACKGROUND

[17] On 11 February 2016, Ms L D’Ascanio, General Manager Employee Relations, sent an email to the MUA advising that “Programmed Marine” would need to make a number of employees in the offshore oil and gas industry redundant. The MUA was invited to a meeting pursuant to subclause 11.2 of the “agreements”. 1

[18] Due to the use of the plural (agreements), it is reasonable to infer that Ms D’Ascanio, when referring to agreements, was referring to both the SKO Agreement and the Total Marine Services Pty Ltd Integrated Ratings, Cooks, Caterers and Seafarers (Offshore Oil and Gas) Enterprise Agreement 2010 (TMS Agreement). Further, it is reasonable to infer that any reference to Programmed Marine is a reference to SKO and Programmed Marine Pty Ltd.

[19] A meeting occurred on 15 February 2016 between Mr Evans, Mr McCabe (MUA Organiser), Ms D’Ascanio and Mr Caldwell.

[20] Subsequent to the meeting, Mr Caldwell issued a memorandum on 17 February 2016 to all permanent employees that “Programmed Marine” must implement redundancies. The memorandum identifies both Programmed Marine Pty Ltd and Skilled Offshore (Australia) Pty Ltd in the headed memorandum at the top of the first page.

[21] The memorandum relevantly states:

“Unfortunately, up to half of our current numbers of permanent employees, across all departments, will need to be made redundant by the conclusion of this process [redundancies].

This difficult decision has been made as a result of two major factors; firstly the extreme downturn in the oil and gas industry; and secondly the recent merger of Programmed and Skilled. Had the demand for our manning services in this sector not suffered significant decline over recent months, the merged business may have been able to continue to operate with the combined total number of offshore employees. However this is not the case and, despite our significant efforts to secure further work and avoid the need to reduce our permanent workforce, we must now proceed with a significant downsizing exercise, and implement redundancies.

The three maritime unions who have covered of our employees in this sector (AMOU, AIMPE and MUA) have already been informed of this situation, and Programmed Marine has commenced the consultation process with those unions as required under the applicable enterprise agreements. We have obtained the agreement of each of those three unions to commence the redundancy process by offering voluntary redundancies across our workforce. All parties agree that voluntary redundancies, where practicable, are preferred to the less desirable process of forced (involuntary) redundancies.” (my emphasis)

[22] On 4 March 2016, Mr Caldwell forwarded to employees an email with respect to voluntary redundancies “across our offshore business”. 2 I am satisfied that this communication was from both SKO and Programmed Marine Pty Ltd. A further communication was sent to employees on 11 March 2016.

[23] On 22 April 2016, a computer generated recipient list of employees, received an email attached to a memorandum from Ms D’Ascanio which relevantly states:

• to date, 29 voluntary redundancies have been implemented and a further 17 are to be implemented;

• Programmed Marine (both SKO and Programmed Marine Pty Ltd) were continuing to engage with the maritime unions to “discuss the next steps in the redundancy process, as required under the applicable enterprise agreements”; and

• where possible, casuals are being replaced with permanent employees pursuant to the enterprise “agreements” 3 (my emphasis).

[24] Further, Ms D’Ascanio’s memorandum states under the question, “When will involuntary redundancies start?”, the following:

“This is still dependent upon a number of critical factors; including the outcome of consultation discussions with the maritime unions, and the decisions of the company as how to proceed with the next stage” 4 (my emphasis).

[25] Under the heading, “How many further redundancies need to be implement?”, Ms D’Ascanio states:

“On current and projected work levels and operational requirements, there is a need for further redundancies across the marine workforce. We are in the process of assessing estimated numbers, how this will be achieved, and the departments/positions that will be affected.” 5 (my emphasis)

[26] On 23 May 2016, there was a meeting between Mr Evans, Mr Cain, Secretary WA Branch of the MUA, Mr Caldwell and Mr Paul, Industrial Relations Advisor.

[27] At the meeting on 23 May 2016, Mr Evans’ written evidence is:

“On 23 May 2016, Mr Cain and I met with Simon Hardbottle (Executive General Manager – Programmed Marine) and Mr Paul. They told us that Skilled Offshore was going to make 100% of its employees involuntarily redundant. This meeting was the first time that Programmed Marine and Skilled Offshore had been treated as separate groups. It was also the first time that the MUA was advised that a decision had been made to implement involuntary redundancies.” 6

[28] On 25 May 2016, Mr Hardbottle emailed Mr Cain. The relevant parts of the email read:

“Thank you for taking the time to meet myself and Clarence [Mr Paul] to discuss the current state of Skilled Offshore (Australia) Pty Ltd (SKO) and its viability of continuing to retain the current number of marine positions. Following for (sic) our call today, the below outlines why we understand that the requirement is for the respective EBA to be applied to the employees of each entity.

…Since that discussion, we confirmed that 17 employees engaged under the Offshore Marine Services Integrated Ratings, Cooks and Caterers enterprise Agreement 2010 (SKO EA) expressed their interest in seeking voluntary redundancy…At about the time Programmed Marine also offered voluntary redundancies to employees and a small number were accepted.

Unfortunately, we anticipate that a further 58 positions (for MUA covered employees) within SKO are likely to be made redundant. There is no work for these positions at present, and we do not expect there to be any work in the foreseeable future.

We have also considered your proposal that redundant positions for Ratings, Cooks and Caterers should be assessed throughout the Programmed Marine and Skilled Offshore entities. That is, consider both entities as ‘one’. We do not agree that is appropriate or necessary.

SKO is a stand alone company that has entered directly into contracts with clients. It is bound by the SKO EA, and of course we will ensure it complies with the SKO EA in relation to its employees SKO can only continue to pay its employees if it continues to generate sufficient revenue. If SKO does not have work for employees then it simply cannot continue to employ people indefinitely. Where possible Programmed Marine has offered work to former SKO employees. But Programmed Marine has not to date been able to redeploy the remaining SKO employees to other work. Nor do we have any upcoming work to which we are able to redeploy the SKO employees in the foreseeable future. As the employees are employed in different entities and on different agreements, each entity operates on a stand alone basis.

We are therefore in the position that we need to consider redundancy for the remaining SKO employees engaged under the SKO EA.” 7 (my emphasis)

[29] Mr Hardbottle’s email to the MUA on 25 May 2016 confirms that, notwithstanding the MUA preference for both entities to be treated “as one”, the SKO entity was to be the sole source of involuntary redundancies.

[30] On 25 May 2016, Mr Hardbottle forwarded to SKO employees a letter which relevantly states:

“Over the past several years the construction activities associated with major projects around Australia has resulted in high levels of demand for marine personnel and related marine services. Unfortunately the construction phase of these major projects has passed their peak with many vessels demobilised and this together with a general downturn in the offshore oil and gas sectors has resulted in all of the marine roles at Skilled Offshore (Australia) Pty Ltd (SKO) now being excess to operational requirements…” 8 (my emphasis)

[31] Mr Evans’ responded to Mr Hardbottle’s email and telephone enquiries. Mr Evans states:

“For the record, this is now formally in dispute. I would urge you to follow the steps in the Agreement in relation to disputes settlement.” 9 (my emphasis)

[32] On 25 May 2016, the Executive General Manager – Operations issued a memorandum to SKO employees in the form of a Frequently Asked Questions (FAQ).

[33] The FAQ’s memorandum relevantly states under the question, “Who may be impacted by the anticipated redundancies of the SKILLED Offshore (Australia) Pty Ltd Marine employees?”

“This change impacts marine employees engaged by SKILLED Offshore (Australia) Pty Ltd (ABN 44 109 339 433), notified on 25 May 2016. Employees engaged by the company Programmed Marine Pty Ltd (CAN 009 231 476) and subject to applicable enterprise agreements will not be directly affected by this change”.

Redeployment opportunities are being sought in other entities within the broader Programmed Group, including Programme Marine Pty Ltd. However, to date, there have not been enough suitable roles available…

As it stands with client contractual requirements to date, we may have potentially exhausted redeployment opportunities for the SKO employees and it does not appear to be possible for the affected SKO employees to be redeployed within Programmed Marine Pty Ltd (ACN 009 231 476) entity.” 10 (my emphasis)

[34] On 26 May 2016, Mr Hardbottle followed up with Mr Evans the MUA’s alternative approach of combining the entities “as one” that was suggested at the meeting on 23 May 2016. Mr Hardbottle indicated that the process of advising SKO employees of anticipated redundancies, was part of the consultation process and Mr Hardbottle emphasised that he is available to meet with the MUA during “this consultation period” 11

[35] On 27 May 2016, Mr Evans sought confirmation that the scheduled meeting on 2 June 2016 would discuss SKO redundancies and other matters. Mr Hardbottle confirmed that the matter would be discussed on 2 June 2016 and that SKO was still seeking feedback as part of the consultation period which was to end on 7 June 2016. The MUA were advised that a decision would be made on 7 June 2016 “with or without agreement from the MUA”. 12

[36] On 2 June 2016, Mr Tracey, Deputy National Secretary of the MUA wrote to Mr Hardbottle. The relevant parts are that:

• the correspondence refers to SKO’s notification of potential redundancies;

• “the Letter referred to a process surrounding redundancies at SKO [as] (the Change)”;

• “The Change is considered a major change as defined by Clause 55.2 of the Agreement [SKO Agreement]. This triggers various obligations which SKO must satisfy before it can implement the Change”;

• Clause 55.4 provides that SKO must, for the purposes of the discussion (Clause 55.3), provide in writing:

(a) all relevant information about the change including the nature of the change proposed;

(b) information about the expected effects of the change on employees; and

[37] Mr Tracey emphasises in his communication of 2 June 2016, that at Clause 55.6, SKO must give prompt and genuine consideration to matters raised about the proposed major change and that the MUA was, “not satisfied that SKO has met its obligations under Clause 55.4 at this time so as to enable full and proper consultation in relation to the Change”.

[38] SKO was “asked to provide responses (with supporting information)” to 20 questions set out by Mr Tracey.

[39] Mr Tracey stated that the MUA required 14 days to consider SKO’s responses to inform itself, “during the process of consultation”. 13

[40] Mr Hardbottle responded on 3 June 2016. Mr Hardbottle denied the allegations in the MUA correspondence and stated that SKO had complied with its obligations pursuant to the SKO Agreement. SKO extended feedback from its proposed redundant employees and the MUA, until 10 June 2016.

[41] Mr Hardbottle advised that SKO was available, at short notice, to meet the MUA. A copy of the SKO correspondence to the MUA was forwarded to all employees who were advised that a decision on the potential redundancies would be made on 13 June 2016.

[42] Mr Evans responded to Mr Hardbottle on the same day (3 June 2016), “we clearly put to you that we would be prepared to put a position of temporary jobshare to our membership (“5/5/5”), subject to making an informed decision once we receive the information we have been seeking”.

[43] On 8 June 2016, Mr Hardbottle responded to Mr Tracey’s correspondence of 2 June 2016. Mr Hardbottle’s correspondence attached SKO’s response to the 20 questions set out by Mr Tracey. Mr Hardbottle states that:

“…the redundancy situation described in its letter dated 25 May 2016 is the result of external factors outside of its reasonable control and not the result of a decision by SKO to introduce any ‘major change’ within the meaning of that term in cl 55.2 of the Agreement”. 14

[44] Mr Hardbottle again invited the MUA to discuss the matter within the extended timeframe.

[45] On 10 June 2016, the MUA filed both of these applications in the Commission. A conference was held on 11 June 2016.

[46] Both applications seek an order, or disclosure, by SKO of information relating to a further 13 questions.

[47] On 13 June 2016, Mr Ellery for SKO provided to Mr Neilson, responses to the 13 questions. Mr Ellery emphasised that in providing the information, SKO are of the view that Clause 55 of the SKO Agreement does not apply. Further, if Clause 55 does apply, it has been complied with, as has s.531 of the FW Act.

[48] Mr Ellery concluded that SKO “continues to be available to meet at short notice with the MUA to discuss these matters further (as it has done many times already). Does your client wish to meet? If not please advise why not”. 15

[49] On 14 June 2016, Mr Neilson responded to Mr Ellery’s correspondence of 13 June 2016. The correspondence attached the amended DSP applications.

[50] Mr Neilson’s correspondence of 14 June 2016 is, in the context of SKO intending to dismiss all the SKO employees. The correspondence states:

“The primary position of the MUA is that it wants the remaining SKO employees to be offered employment with Programmed Marine [Pty Ltd] so that Programmed Marine can implement the redundancies across the combined and current Programmed Marine [Pty Ltd] /SKO workforce”.

[51] Mr Neilson’s correspondence also advised that the MUA was available to meet with SKO up to, or on the morning of 16 June 2016, to discuss the matter. Further, the MUA sought information on a further seven (7) questions or part questions, “to be able to meaningfully engage in consultation” with SKO. 16

[52] SKO sought a meeting on the morning of 16 June 2016. However, MUA representatives were not available.

[53] The hearing into both applications took place on 17 June 2016.

RELEVANT LEGISLATIVE FRAMEWORK (C2016/4085)

[54] The FW Act relevantly provides at ss.738 and 739 as follows.

“738 Application of this Division

This Division applies if:

(a) …

(b) an enterprise agreement includes a term that provides a procedure for dealing with disputes, including a term referred to in subsection 186(6); or

(d) …”

“739 Disputes dealt with by the FWC

(1) This section applies if a term referred to in section 738 requires or allows the FWC to deal with a dispute.

(2) …

(3) In dealing with a dispute, the FWC must not exercise any powers limited by the term.

(4) If, in accordance with the term, the parties have agreed that the FWC may arbitrate (however described) the dispute, the FWC may do so.

Note: The FWC may also deal with a dispute by mediation or conciliation, or by making a recommendation or expressing an opinion (see subsection 595(2)).

(5) Despite subsection (4), the FWC must not make a decision that is inconsistent with this Act, or a fair work instrument that applies to the parties.

(6) The FWC may deal with a dispute only on application by a party to the dispute.”

RELEVANT PROVISIONS OF SKO ENTERPRISE AGREEMENT (C2016/4085)

[55] The DSP in the SKO Agreement, is set out at Clause 45.

[56] Clause 45 refers to a process when an “industrial dispute” arises. In the event of Steps 1 to 3 failing to resolve the dispute, the matter may be referred to the Commission.

[57] In an application to the Commission, the applicant is required to nominate the clauses the dispute relates to. In this application, the MUA have nominated Clauses 11 and 55.

[58] Clause 11 deals with Termination of Employment. Subclause 11.2 deals with the Redundancy Process.

[59] Clause 55 is entitled “Consultation”. The clause relates to the Employer notifying employees and the MUA of the “Employer’s decision to introduce a major change”. Further, what discussions must occur between employees and the MUA regarding the major change, the effects of the major change and the measures the employer is taking to “avert or mitigate the adverse effect of the change”.

[60] I turn first to Clause 11.

Clause 11 – Termination of Employment

[61] Clause 11 deals with termination of employment by either party. Clearly, termination by way of redundancy falls within the general termination of employment and is not excluded by the “misconduct” provision.

[62] Termination by way of redundancy is set out in subclause 11.2. The Redundancy process can be summarised as follows:

• the Employer will inform the MUA of the redundancy situation;
• the Employer will determine the number of redundancy packages to apply;
• employees will be made redundant in the following order:

- casual employees on a last on first off basis (LOFO);
- 30% of remaining redundancies on a voluntary basis; and
- the remaining on a LOFO basis.

[63] Prior to any redundancies, excess leave balances will be taken.

[64] “Contract of Employment” provisions are contained at Clause 7. Subclause 7.4 specifically states:

“Termination of the employment by the Employer or the Employee shall be in accordance with clause 11- Termination of Employment” (my emphasis).

[65] I now turn to Clause 55.

Clause 55 – Consultation

[66] Subclause 55.1 requires notification to employees and the MUA of the “Employer’s decision to introduce a major change” (my emphasis).

[67] “Major change” is where the proposed change is likely to result, relevantly:

• in the termination of the employment of employees; and
• major change to the “composition, operation or size” of the workforce.

[68] There are other likely consequences of major change set out in subclause 55.2. For the purposes of this application, I intend to constrain my comments to the likely consequences in paragraph [67] immediately above.

[69] In subclause 55.3, for the purposes of the mandatory discussions after SKO has made a decision to introduce a major change, it must discuss the measures it is taking to avert or mitigate the adverse effect of the change on the employees.

[70] At subclause 55.4, SKO must, for the purposes of discussions, provide, in writing, to the relevant Employees:

• all relevant information about the change;
• the expected effects of the change on the Employees;
• any other matters likely to affect the Employees.

MUA SUBMISSION

Section 739 Application

[71] The MUA submit that a dispute exists between it and SKO with respect to Clauses 11 and 55 of the SKO Agreement.

[72] The MUA assert that Clause 55 is relevant to dismissal of the SKO employees and the necessary information it seeks for the outstanding proper consultation to occur. 17

Amended Section 739 Application

[73] The MUA submit that the involuntary redundancies identified by SKO should be “shelved” and considered in the context of whole of SKO and Programmed Marine Pty Ltd workforces.

[74] The MUA put that there are “fair and just” reasons for taking such an approach. The reasons are:

• both entities are subject to the same managerial control;

• SKO have transferred all existing labour service contracts to Programmed Marine Pty Ltd;

• SKO have provided no reasons for why such a transfer was necessary which has resulted in SKO having no work for its employees and the consequential redundancies; and

• the SKO Agreement is a transferrable instrument pursuant to s.313 of the FW Act. Further, Programmed Marine Pty Ltd is now covered by the SKO Agreement and must comply with the SKO Agreement.

[75] Consequently, the MUA is in dispute, as a result of the transferable instrument (SKO Agreement), with both SKO and Programmed Marine Pty Ltd.

[76] The consequence of all this is that the MUA submit it is in dispute with both SKO and Programmed Marine Pty Ltd for not assessing all current SKO employees together with Programmed Marine Pty Ltd employees, as to who should be made redundant or if they should be made redundant.

APPLICATION TO DEAL WITH A DISPUTE IN ACCORDANCE WITH A DSP (C2016/4085)

[77] In the initial application to the Commission to deal with a dispute in accordance with a DSP, the MUA nominate the Respondent as SKO and the enterprise agreement which contains the DSP relevant to the application, as the SKO Agreement.

[78] In its amended application to C2016/4085, the MUA add Programmed Marine Pty Ltd as a nominated Respondent. The enterprise agreement, which contains the DSP relevant to the amended application, remains the SKO Agreement.

[79] I intend to deal with the MUA’s request for leave to amend the initial application first.

Should leave be granted to amend the initial application?

[80] Section 586 of the FW Act facilitates the discretion of the Commission to amend an application, “on any terms that it considers appropriate”. 18

[81] In support of amending the application, the MUA state that it is a necessary concomitant to its desired outcome that compulsory redundancies be assessed across the current workforces of both SKO and Programmed Marine Pty Ltd.

[82] In addition, the MUA submit that SKO and Programmed Marine Pty Ltd are associated entities with the same management control. Further, SKO have transferred two (2) labour services contracts to Programmed Marine Pty Ltd; there was no reason to transfer those particular labour services contracts because it now leaves SKO with no work for its employees; former employees of SKO have transferred to Programmed Marine Pty Ltd; the SKO Agreement is now a transferrable instrument pursuant to s.312 of the FW Act and the MUA continues to be a party to the SKO Agreement in accordance with s.315 of the FW Act.

[83] Programmed Marine Pty Ltd object to the amended application because the provisions of the DSP have not been complied with, and accordingly, the Commission has no power to deal with the dispute. Secondly, the order sought by the MUA for compulsory redundancies to be assessed across both entities, would require the order being made against Programmed Marine Pty Ltd which is beyond the Commission’s jurisdiction.

What is the dispute about?

[84] In its amended application of 14 June 2016, the MUA assert:

“24. The MUA is in dispute with SKO (and PM) as a consequence of neither SKO nor PM assessing current SKO employees for redundancy together with current PM employees.

25. Further, the MUA is in dispute with SKO (and now PM as a party bound by the Agreement) as a result of the failure of SKO (and PM) to consider and transfer employees from SKO to PM.” 19

Have the procedural requirements in the DSP in the SKO Agreement been complied with in respect to Programmed Marine Pty Ltd?

[85] There is no dispute between the parties that, pursuant to s.313 of the FW Act, the SKO Agreement is applicable to and covers those employees who transferred to Programmed Marine Pty Ltd.

[86] Once a dispute arises, it is necessary that the employee or the employee’s representative follow the procedures set out in Steps 1-3 before the matter can be referred to the Commission.

[87] I have no evidence to demonstrate that an employee of Programmed Marine Pty Ltd, or their representative, has advised Programmed Marine Pty Ltd that a dispute exists as set out in the amended application.

[88] To put it without any sophistication, the MUA cannot demonstrate that one of the SKO employees whose employment transferred to Programmed Marine Pty Ltd has approached their new employer, Programmed Marine Pty Ltd, to say words to the effect that, “I want to be assessed for compulsory redundancy along with the SKO employees”. In effect, the transferred employee is essentially being required to state that he or she does not want to be excluded from the potential of being made redundant.

[89] Mr Evans’ evidence is that he was informed on 23 May 2016, and advised in writing on 25 May 2016, that 100% of SKO employees were to be made redundant. On the same day (25 May 2016) Mr Evans sent an email to Mr Hardbottle which refers to SKO employees and MUA members, being told that they had been made redundant. Mr Evans concludes his email, “for the record, this is now formally in dispute”. 20 The MUA submit that this is written evidence to demonstrate that the MUA was in dispute with both SKO and Programmed Marine Pty Ltd.

[90] Further, the MUA seek to amend its application to include “(and PM [Programmed Marine Pty Ltd] representatives)”, when referring to ongoing discussions relating to the proposed redundancies.

[91] In view of the consequences of such a dispute, it is essential that the procedural steps in 1-3 are complied with, and in particular, the provisions of subclause 46.7 of the DSP. Subclause 46.7 of the DSP emphasises, “it is essential that any dispute in issue and the reasons for or against are accurately defined by those concerned to ensure that ambiguities do not arise…”

[92] It is noticeable that the MUA, in its initial application, in answer to the question regarding what the dispute is about, does not refer to Programmed Marine Pty Ltd. Programmed Marine Pty Ltd only became aware it was allegedly in dispute, as the new employer of former SKO employees, pursuant to the SKO Agreement, on 14 June 2016.

[93] I find that the application to amend the originating application is a reshaping of the circumstances in order to enjoin Programme Marine Pty Ltd at this late stage to facilitate the desired outcome of redundancies being considered across both entities, and subsequently, the “5/5/5” proposal to mitigate those redundancies.

[94] For the reasons set out above, including the timing of the request to amend the application and further reasons associated with the substantive application, I do not consider it appropriate, pursuant to s.586(a) of the FW Act, to amend the application filed in the Commission on 10 June 2016.

REDUNDANCY PROCESS - Clause 11

[95] I intend to consider the redundancy process through a series of questions.

What are the obligations of SKO to inform the MUA of the redundancies?

[96] Pursuant to subclause 11.2(a)(i) of the SKO Agreement, SKO is required to inform the MUA of the “redundancy situation”.

Was there acceptable notice of the redundancies?

[97] I am satisfied that SKO informed the MUA verbally on 9 February 2016 and confirmed, the redundancy situation, in writing on 11 February 2016.

[98] At a meeting on 15 February 2016, between MUA representatives and Mr Caldwell, Ms D’Ascanio, Ms Eastcott, Mr Paul and Mr Nunn, employer representatives advised the MUA that 88 permanent employees had to be made redundant. Both the written and verbal notice was acceptable.

Were the proposed redundancies progressed in accordance with subclause 11.2(c) of the SKO Agreement?

[99] Agreement was reached to a process whereby voluntary redundancies would be sought from the relevant employees of both SKO and Programmed Marine (Australia) Pty Ltd, in the first instance.

How many voluntary redundancies occurred?

[100] I am satisfied that at 22 April 2016, there had been 36 voluntary redundancies approved across both SKO and Programme Marine Pty Ltd.

When was the MUA advised of involuntary redundancies and the number and source of involuntary redundancies?

[101] I am satisfied, on the evidence, that the MUA was informed by Mr Hardbottle on 23 May 2013 that involuntary redundancies were necessary and that they would be sourced from SKO alone. 21

[102] I find that Mr Hardbottle reduced this information to writing on 25 May 2016 and he advised the MUA that 58 involuntary redundancies were necessary.

[103] I now wish to make some general observations regarding subclause 11.2 of the SKO Agreement.

[104] Clause 11 relates to “Termination of Employment”. Clause 11 is a separate and discrete clause from Clause 55 which is entitled “Consultation”.

[105] Clause 55 relates to consultation following the “Employer’s decision to introduce a major change” (my emphasis).

[106] Clause 11 deals with the process relating to cessation of employment. Subclause 11.1 concerns cessation of employment in the ordinary course of events. Subclause 11.2 relates to termination of employment due to an excess number of employees to available positions. Subclause 11.3 is not relevant.

[107] Both subclauses 11.1 and 11.2 deal with “process”. The Australian Concise Oxford Dictionary (ACOD) defines “process” as “course of action, proceedings, esp series of operations in manufacturing…series of changes”. As I understand the ACOD definition, “process” is the manner, method, procedure or way of implementing something which in this context is redundancies.

[108] The process of redundancies in subclause 11.2 is not dealing with how the redundancies came into existence, or consultation regarding mitigating any adverse impact; process, existence and consultation are inherently different.

[109] Finally, pursuant to subclause 7.4 of the SKO Agreement, any termination of employment must be in accordance with Clause 11, Termination of Employment.

[110] Subclause 11.2 does not provide for consultation with respect to how the redundancies came into existence or mitigating the adverse impact of the redundancies. However, subclause 11.2 provides for discussion with the MUA on any departure from order provided in subclauses 11.2(c)(i)–(iii). There is no dispute between management representatives from SKO and Programmed Martine Pty Ltd and the MUA, that they agreed to depart from that order and extended voluntary redundancies across two entities. That was the extent of any agreement, and accordingly, any process beyond that agreement reverts to the provisions in subclause 11.2 (c)(i)–(iii), subject to subclause 11.2(b ).

[111] With respect to the process of redundancies, there is no requirement for the SKO to agree to part or all of any proposal by the MUA. In the circumstances, the parties agreed to a process for voluntary redundancies and that is provided for in subclause 11.2 of the SKO Agreement.

[112] Notwithstanding the provisions of subclause 11.2, it is useful to set out what the MUA was proposing as a process. This is best set out in Mr Evans’ evidence and is as follows:

“At this meeting [on or about 9 February 2016], we [MUA] flagged that we would be prepared to put to our membership a job share proposal, once voluntary redundancies had been exhausted and casual employees had been let go as per clause 11.2(c)(i) of the Agreement, and depending on whether redundancies were still needed at that stage. We explained that this had been agreed with our members and another employer in the industry GO Offshore Pty Ltd, and that it operated on the basis that employees work 5 weeks on/5 weeks off on accrued marine leave/5 weeks off on unpaid leave. They [SKO and Programmed Marine (Australia) Pty Ltd representatives] indicated they would consider this proposal if required”. 22

[113] On 23 May 2016, there was a further meeting between MUA and SKO and Programmed Marine Pty Ltd representatives. At that meeting, as I have already set out, the MUA were advised of involuntary redundancies to be applied to 100% of SKO employees. 23

[114] Mr Hardbottle confirmed what was now SKO’s position in writing to the MUA on 25 May 2016. Mr Hardbottle states that SKO have considered the MUA’s proposal to treat both entities “as one” and “we do not agree that it is appropriate or necessary”. 24

[115] Whether the Commission would come to the same view or agree with the MUA’s proposal or have an alternative suggestion is irrelevant. In the absence of any agreement, pursuant to subclause 11.2(d) to deviate from the process in subclause 11.2(c) of the SKO Agreement, the “balance” of redundancies (in this case, all employees) were made redundant in accordance with subclause 11.2(c)(iii).

[116] The actual dispute between the MUA and SKO, is that the MUA wants SKO to reverse its decision of 25 May 2016 to source all 58 involuntary redundancies from SKO and source them from a combination of SKO and Programmed Marine Pty Ltd.

[117] However, unless there is agreement between the MUA and SKO pursuant to subclause 11.2(d) to depart from subclause 11.2(c), then 11.2(c) applies. Presumably, for SKO to depart from 11.2(c), it would be necessary to gain the approval or concurrence of Programmed Marine Pty Ltd – that approval, it appears was not forthcoming, hence the parties are required to fall back to subclause 11.2(c) of the SKO Agreement.

[118] Having considered all the circumstances, SKO have applied the provisions of subclause 11.2 of the SKO Agreement, to effect the redundancies notwithstanding the MUA’s request for an alternative formula to apply.

CONSULTATION – Clause 55

[119] Subclause 55.3 of the SKO Agreement requires SKO, as soon as practicable, to discuss with relevant employees and the MUA, “after making its decision to introduce major change”. SKO must: discuss the introduction of that change, the effects of the change which is likely to have on employees, and any measures to “avert or mitigate the adverse effect of the change”.

[120] Subclause 55.4 of the SKO Agreement requires SKO to provide, for the purposes of the above discussion, relevant information.

[121] However, for subclauses 55.3 and 55.4 of the SKO Agreement to become operative, it is necessary that the SKO make a decision to introduce “major change”.

[122] The existence, or likely existence of the circumstances set out in subclause 55.2 of the SKO Agreement, is not a “major change”. In a logical and common sense meaning, the circumstances which arise in subclause 55.2 derive, or likely to derive, as a consequence of a decision by SKO to “introduce a major change”.

[123] Clause 55 of the SKO Agreement makes an important distinction between “cause” in subclause 55.1 and “consequences” in subclause 55.2, and the mandatory requirements in subclauses 55.3 and 55.4.

[124] For the mandatory requirements in subclauses 55.3 and 55.4 to become operative, there needs to be the existence of SKO making a “decision to introduce a major change”. Without SKO making a “decision to introduce major change”, no conditions exist to make subclauses 55.3 and 55.4 operative.

[125] What evidence does the Commission have in relation to the circumstances which led to SKO advising its employees, and the MUA, of the need for both voluntary and involuntary redundancies?

[126] Mr Caldwell’s undisturbed evidence is that:

“Since around the middle of 2015, there has been a substantial downturn in the amount of work in the offshore oil and gas industry. This is because of big projects, such as Gorgon, Wheatstone and Ichthys coming to an end. As well, the dramatic fall in the price of oil has resulted in a substantial decline in activity (such as drilling, seismic and marine maintenance) requiring the services provided by SKO and PM.

Efforts have been made by SKO to get more work. For instance, SKO submitted four tenders before the end of last year. However, as at the date of this statement, there is no indication that any of those tenders will be accepted. Even if any of them are accepted, the work tendered for will not commence any earlier than around the end of 2016.

There is currently no work for SKO. I do not expect SKO or PM to pick up any substantial work in the foreseeable future.

Because of the fall in demand for the services of SKO, since the completion of the Inpex pipelay project, SKO has ceased employing 203 casual employees. Currently, for the first time in its trading history, SKO employs no casual employees.

SKO’s workforce now consists of 53 permanent employees. They do not perform any work, even though they are still being paid as permanent employees. In industry terminology, they are ‘sitting on the beach’. This is because there is no work for them to do. Annexed and marked ‘SJC- 2’ is a schedule of those employees, which states the date on which they last did any work.” 25

[127] In my view, the cause of voluntary and involuntary redundancies can be explained, not by any decision of the employer to introduce a major change, but by a diminishing demand for SKO’s marine labour services to vessels and an oversupply of labour.

[128] Furthermore, I have no evidence to the contrary, that this was anything other than a supply/demand situation. To be fair to the MUA, it did not try to create or formulate another explanation for the need for redundancies.

[129] However, the MUA attempted to characterise the effects of the alleged introduction of a major change, as a major change itself. In my view, this is an incorrect and misapplication of the provisions of Clause 55.

[130] This characterisation by the MUA is best demonstrated by Mr Tracey in his correspondence of 2 June 2016 to Mr Hardbottle. Mr Tracey’s first paragraph reads:

“The MUA has been contacted by a number of its members as a consequence of an email and letter sent by Skilled Offshore (Australia) Pty Ltd (‘SKO’) on Wednesday 25 May 2016 (‘the Letter’). The Letter referred to a process surrounding redundancies at SKO (‘the Change’)”. 26 (my emphasis)

[131] The Letter is headed “Anticipated redundancies of SKILLED Offshore (SKO) Marine Employees”. The Letter informs the SKO employee that their position will be made redundant. Further, the Letter advises the consultation is continuing regarding the process of anticipated redundancies, encouraging employees to seek alternative roles and that a final decision on the redundancies will be made shortly after 8 June 2016. 27

[132] Mr Tracey is correct in that Mr Hardbottle’s letter of 25 May 2016 is about the process. However, Mr Tracey characterises the change in process, as a “major change as defined by Clause 55.2 of the Agreement. This triggers various obligations which SKO must satisfy before it can implement the Change”. Accordingly, Mr Tracey proceeds to seek responses to 20 questions.

[133] It appears, due to the MUA’s inability to argue against a downturn in the offshore oil and gas industry and that SKO has not made a “decision to introduce a major change”, the Union has resorted to describing the process of sourcing involuntary redundancies from SKO alone, as a “the Change” – or a change from the process adopted for voluntary redundancies.

[134] Firstly, voluntary and involuntary redundancies are two discrete concepts and processes.

[135] Secondly, the process for involuntary redundancies for SKO employees is set out in the SKO Agreement.

[136] Thirdly, it has not been alleged that SKO has departed or changed from the process set out in subclause 11.2 of the SKO Agreement in relation to involuntary redundancies.

[137] Fourthly, there has been no agreement between SKO and the MUA to depart from the process in subclause 11.2(c) of the SKO Agreement for the involuntary redundancies.

[138] Essentially, the “Change” referred to by Mr Tracey in his correspondence of 2 June 2016, is to superimpose or rewrite subclause 11.2 of the SKO Agreement that when redundancies arise in SKO, they be considered in the context of related entities, and further, all employees be considered as part of a pool from which the redundant employees will be drawn from.

[139] It was not contested that SKO and Programmed Marine Pty Ltd are separate legal entities. Further, I cannot see how the SKO Agreement, when it came into existence, binds another legal entity, whether related or not, to a process of SKO redundancies being merged with other employees, unless by agreement. Notwithstanding that Programmed Maintenance Services Limited acquired all the shares of SKILLED Group Limited, SKO is a separate legal entity as is Programme Marine Pty Ltd.

[140] In summary, I do not accept that the MUA’s assertion that Mr Hardbottle’s letter of 25 May 2016, regarding the process of redundancies, is a major change. Further, I do not accept the MUA’s assertion that, “the process surrounding the redundancies at SKO…is a major change as defined by Clause 55.2 of the Agreement”. 28 Subclause 55.2 deals with the effects of major change not the major change itself.

[141] In conclusion, I find that SKO did not make a “decision to introduce major change” pursuant to subclause 55.1 of the SKO Agreement. Secondly, as a consequence of not making a “decision to introduce major change”, the remaining mandatory conditions or requirements in subclauses 55.3, 55.4 and 55.6 are not applicable.

[142] Notwithstanding my finding immediately above in paragraph [141], should I be wrong, it is necessary to consider whether, in any event, SKO has carried out the mandatory requirements in subclauses 55.3, 55.4 and 55.6 of the SKO Agreement.

[143] I am satisfied, on the evidence, that from, on or about 9 February 2016, discussions, pursuant to subclause 55.3 of the SKO Agreement, took place.

[144] Four (4) months after the commencement of discussions regarding the redundancy, and seven (7) days before making the application to deal with a dispute, the MUA put, on 2 June 2016, 20 questions to SKO.

[145] SKO provided a response to the 20 questions on 8 June 2016. The MUA sought a response to a further 13 questions on 10 June 2016. A response to a further seven (7) questions/part questions was sought also on 14 June 2016.

[146] The evidence is that, from 23 May 2016, the MUA knew that 100% of the involuntary redundancies were to be sourced from SKO.

[147] I consider it a reasonable inference that the MUA was aware of the construction phase of major projects coming to an end and the high level need of marine personnel declining. Many vessels have now left Australia’s shores. Because of its unique position within the offshore oil and gas sector, I also consider it reasonable to infer that the MUA is aware of the fall in commodity prices, the falling and fluctuating exchange rate and declining business investment in the mining and resource sectors.

[148] SKO is not the only employer experiencing the effects of the downturn in the resources sector in Western Australia, as indicated in Mr Evans’ evidence. 29 I am satisfied that the MUA have the information and broadly understand the declining need for marine personnel in the resources sector.

[149] With respect to the expected effects of the declining need for marine personnel, it is unfortunately simple – there is a corresponding decline in jobs. The unfortunate consequence, of adverse economic circumstances, is the “cold wind” of redundancies. No amount of information will change a situation of an employer having no contracts on its books to keep employees employed.

[150] My points above are to demonstrate that, while an employer has an obligation to consult, the content of that consultation will vary according to the circumstances. And it is the circumstances of this redundancy situation, I must consider.

[151] Notwithstanding that SKO disagrees that Clause 55 of the SKO Agreement applies, it has provided answers to the 40 questions put by the MUA.

[152] In the totality of the evidence, it is a reasonable inference that the MUA accepts that redundancies are occurring in the offshore oil and gas industry and have to occur with respect to SKO. This acceptance led to an agreed process of voluntary severances in the first instance. Where the parties disagree, is the process of involuntary redundancies.

[153] The essence of the MUA’s position is that it wants SKO employees to be “offered employment with Programmed Marine [Pty Ltd] so that Programmed Marine Pty Ltd can implement the redundancies across the combined and current Programmed Marine/SKO workforce”. 30

[154] Programmed Marine Pty Ltd has said “no” to the suggestion.

[155] Accordingly and in my view, astonishingly, because Programme Marine Pty Ltd said “no”, the MUA’s view is that Programmed Marine Pty Ltd did not genuinely consider the proposal. 31

[156] In order for the MUA to reach, what I would call, its real primary position which is the job share arrangement of “5/5/5”, it is a necessary condition that Programmed Marine Pty Ltd employ the remaining SKO employees. Once employed by Programme Marine Pty Ltd, the MUA’s proposal of “5/5/5” would possibly avoid, or mitigate, the number of involuntary redundancies.

[157] This set of circumstances leads to the conclusion that the essence of the dispute is the refusal of Programmed Marine Pty Ltd to agree to employ the remaining SKO employees, and therefore, in the MUA’s view, obstruct redundancies across two entities and a potential “5/5/5” arrangement.

[158] If, as the MUA state it is of the view, that because Programmed Marine Pty Ltd has said “no”, and consequently has “not genuinely considered” the proposal, it is unlikely that the provision of information to the MUA of answers to 40 questions, will change its proposal or the decision of Programme Marine Pty Ltd.

[159] Further, consultation in Clause 55 of the SKO Agreement, and other like clauses, resemble an interlocutory provision which is directed towards an end; consultation is not a protection in itself to the major change. Somebody has to bring consultation to an end, and it is usually the employer.

[160] In Clause 55, there is no obligation upon SKO to accommodate the MUA’s proposals. This is more particular when the proposal involves a third party (albeit related), to employ the employees who are to be made redundant.

[161] It is clear that SKO and the MUA have divergent views on the process of making a number of employees redundant. However, Clause 55 of the SKO Agreement provides for consultation and not co-management of the circumstances, especially a situation that requires agreement of a “third party” employer.

[162] In summary, in the event that Clause 55 of the SKO Agreement applies, I am satisfied, in the circumstances, that SKO has provided, in writing, relevant information for the purposes of subclause 55.4. Further, that SKO has given prompt and genuine consideration to matters raised by the MUA.

RELEVANT LEGISLATIVE FRAMEWORK (C2016/4086)

[163] Division 2 of Part 3-6 of the FW Act deals with notification and consultation relating to certain dismissals. Subdivision B relates to the failure to notify or consult registered associations where an employer has made a decision to “dismiss 15 or more employees for reasons of economic, technological, structural or similar nature”. The relevant provisions are:

“531 FWC may make orders where failure to notify or consult registered employee associations about dismissals

(1) The FWC may make an order under subsection 532(1) if it is satisfied that:

(a) an employer has decided to dismiss 15 or more employees for reasons of an economic, technological, structural or similar nature, or for reasons including such reasons; and

(b) the employer has not complied with subsection (2) (which deals with notifying relevant registered employee associations) or subsection (3) (which deals with consulting relevant registered employee associations); and

(c) the employer could reasonably be expected to have known, when he or she made the decision, that one or more of the employees were members of a registered employee association.

Notifying relevant registered employee associations

(2) An employer complies with this subsection if:

(a) the employer notifies each registered employee association of which any of the employees was a member, and that was entitled to represent the industrial interests of that member, of the following:

(i) the proposed dismissals and the reasons for them;

(ii) the number and categories of employees likely to be affected;

(iii) the time when, or the period over which, the employer intends to carry out the dismissals; and

(b) the notice is given:

(i) as soon as practicable after making the decision; and

(ii) before dismissing an employee in accordance with the decision.

Consulting relevant registered employee associations

(3) An employer complies with this subsection if:

(a) the employer gives each registered employee association of which any of the employees was a member, and that was entitled to represent the industrial interests of that member, an opportunity to consult the employer on:

(i) measures to avert or minimise the proposed dismissals; and

(ii) measures (such as finding alternative employment) to mitigate the adverse effects of the proposed dismissals; and

(b) the opportunity is given:

(i) as soon as practicable after making the decision; and

(ii) before dismissing an employee in accordance with the decision.”

“532 Orders that the FWC may make

(1) The FWC may make whatever orders it considers appropriate, in the public interest, to put:

(a) the employees; and

(b) each registered employee association referred to in paragraph 531(2)(a) or (3)(a);

in the same position (as nearly as can be done) as if the employer had complied with subsections 531(2) and (3).

(2) …”

RELEVANT ORDERS SOUGHT BY MUA PURSUANT TO SECTION 532(1) OF FW ACT

[164] Orders sought by the MUA are as follows:

“1. Until the final hearing and determination of this proceeding or further order of the Commission, Skilled Offshore (Australian) Pty Ltd (‘SKO’) is restrained from issuing notices of dismissal on the grounds of redundancy to any employee of SKO whom it notified of a potential redundancy on or around 25 May 2016.

2. SKO disclose the following information to the MUA:

a. Who made the decision to assign the contract for the Nor Australis to Programmed Marine and for what reason?

b. When did SKO cease providing the marine manning for the OMS Endurance?

c. Who made the decision to assign that work/contract from SKO to Programmed Marine and for what reason?

d. Were SKO employees working on the OMS Endurance offered the opportunity to transfer to Programmed Marine? If so, how many elected to accept the transfer? If they were not offered the opportunity to transfer, why not?

e. Where SKO employees have been offered to transfer from SKO to Programmed Marine, on what basis were those SKO employees selected?

f. Have all SKO employees taken excess leave balances or will be given an opportunity to do so prior to any redundancies?

g. The number of full time, part time and casual employees (currently) employed by each SKO and Programmed Marine and the start date for each of those employees.

3. SKO and PM begin meeting in person with the MUA within 48 hours of the provision of the information as specified in order 2 above and thereafter on two more occasions to discuss:

(i) measures that SKO is taking to avert or mitigate the proposed redundancies; and
(ii) measures (such as finding alternative employment) to mitigate the adverse effect of the proposed dismissals.

4. Following the meetings referred to in Order 3 above, the parties return to the Fair Work Commission for directions on [DATE].

5. Prior to any SKO employees being made redundant they will be offered employment with PM in order that they will be assessed for redundancy together with current PM employees.

6. Any dispute arising from the application of this order shall be referred to Fair Work Commission for determination.”

Section 533 Application

[165] The MUA submit that “SKO did not decide to dismiss 15 or more employees until the end of May 2016”. 32

[166] The MUA acknowledge that “SKO and PM [Programmed Marine Pty Ltd] jointly from February 2016, had discussions with the MUA about the possibility of dismissal and offered voluntary redundancies. However, there had been no definite decision by SKO to dismiss 15 or more employees. 33 The MUA rely for this assertion on a communication from PM to all employees of PM and SKO of 22 April 2016”.

[167] However, the nub of the submission is that SKO has “not provided the MUA with information relevant to adequate consultation…The information (still outstanding) is necessary for proper consultation to occur. Without full information, it is difficult for the MUA to formulate alternatives to redundancy and full (sic) explore all options to mitigate redundancies with SKO” 34.

[168] The MUA submit that after receiving all the relevant information, it will be necessary for the parties to meet on at least three (3) occasions to “discuss measures that SKO is taking to avert or mitigate the proposed redundancies; and measures (such as finding alternative employment) to mitigate the adverse effect of the proposed dismissals” 35 (my emphasis).

[169] Mr Evans’ evidence is that, as at 15 February 2016, the MUA was aware that 88 permanent employees would be made redundant. However, underlying this evidence is the inference that the 88 redundancies would occur within SKO and Programmed Marine Pty Ltd. In my view, at that stage of the discussions, the emphasis was upon voluntary redundancies; no process had been determined with respect to involuntary redundancies, if necessary. If sufficient voluntary redundancies had been received, where involuntary redundancies were sourced, would have been a moot point.

[170] It is not unreasonable to assume that the MUA, with its knowledge and experience of the offshore oil and gas sector, would be able to assess whether there would be insufficient voluntary redundancies during such a process. It would appear that as early as 9 February 2016, Mr Evans put to management representatives of both SKO and Programmed Marine Pty Ltd the “5/5/5” arrangement which operated with another employer after casual and voluntary redundancies had been effected. In my view, it cannot be claimed that the possibility of involuntary redundancies was not part of “the picture” and that those involuntary redundancies would be sourced from SKO, Programmed Marine Pty Ltd or from both entities. The putting of the “5/5/5” proposal itself indicated that the MUA considered that involuntary redundancies were possible.

[171] In summary, it would be misleading to consider that SKO’s decision to source involuntary redundancies from SKO alone had occurred in a vacuum. Further, I do not accept the assertion that consultation on the SKO involuntary redundancies only commenced on 27 May 2016; it had been part of the overall picture since 9 February 2016.

[172] Notification and consultation commenced on 9 February 2016 and entered a second phase (involuntary redundancies) on or about 25 May 2016 Perversely, that consultation on the second phase, commenced with the MUA putting SKO on notice that it was formally in dispute with SKO and requested it to follow the DSP.

[173] It would be misleading to state that consultation only occurred after 25 May 2016. While a generalisation, it would appear that, for the most part, consultation was the MUA putting a series of questions to SKO, SKO responding and these applications.

[174] I do not intend to repeat what I have already set out in relation to the dispute and consultation pursuant to Clauses 11 and 55 of the SKO Agreement.

[175] I refer to paragraphs [9] to [162] and relevantly adopt, for the purposes of this application and amended application.

[176] Section 531 of the FW Act enables the Commission to make orders it considers appropriate, in the public interest, to put employees “in the same position (as nearly as can be done) as if the employer had complied with subsection 531(2) and (3)” of the FW Act.

[177] For the reasons outlined above, I am satisfied that the MUA was notified of the redundancies. Secondly, the MUA has been given and has put measures to SKO, to avert or minimise the involuntary redundancies and any adverse effects of those redundancies.

[178] In conclusion, in my view, the Commission is dealing, not with a failure to consult, but with a failure of SKO to accommodate the proposals put by the MUA. Neither Clauses 11 nor 55 of the SKO Agreement, nor section 531 of the FW Act, obligate agreement by the parties to a process of involuntary redundancies.

[179] For completeness, and having regard to all the circumstances set out above, I do not consider it appropriate, to amend application C2016/4086 pursuant to s.586(a) of the FW Act. In particular, I repeat my statements above regarding SKO and Programmed Marine Pty Ltd being separate and discrete legal entities, regarding an order in the amended application which seeks that:

“Prior to any SKO employees being made redundant they will be offered employment with PM [Programmed Marine Pty Ltd] in order that they will be assessed for redundancy together with current PM employees”.

CONCLUSION

[180] For the above reasons, leave is not granted to amend applications C2016/4085 and C2016/4086, pursuant to s.586(a) of the FW Act.

[181] Both originating applications are dismissed for the reasons set out above.

[182] With respect to application C2016/4085, I am satisfied that SKO has applied the provisions of Clause 11 and that it did not introduce a major change pursuant to Clause 55 of the SKO Agreement. And, in the event that SKO did introduce a major change, SKO complied with those provisions in the circumstances of the involuntary redundancies.

[183] I have considered the wide and “novel questions about the obligations of an employer to consider redundancies across its entire workforce” as submitted by the MUA. However, in view of the need for an expedited decision, I have found it not necessary to consider each “limb” of the submissions or the authorities referred to. I am of the view that the applications can, and should, be decided within the “four corners” of the FW Act and the relevant enterprise agreement.

[184] An Order to reflect my Decision is attached.

COMMISSIONER

Appearances:

S Crawshaw SC, of Counsel, on behalf of the MUA.

J Blackburn SC, of Counsel, on behalf of SKO.

Hearing details:

2016:

Perth,

17 June.

1 Exhibit A5 (AE1)

2 Exhibit A5 (AE3)

3 Exhibit A5 (AE5)

4 Exhibit A5 (AE5)

5 Exhibit A5 (AE5)

6 Exhibit A5 (23)

7 Exhibit A5 (AE6)

8 Exhibit A5 (AE8)

9 Exhibit A5 (AE7)

10 Exhibit A5 (AE9)

11 Exhibit A5 (AE11)

12 Exhibit A5 (AE13)

13 Exhibit A5 (AE16)

14 Exhibit A5 (AE20)

15 Exhibit A5 (AE21)

16 Exhibit A5 (AE22)

17 Exhibit A5 (31)

18 Section 586(a) of the FW Act

19 Exhibit A4

20 Exhibit A5 (AE7)

21 Exhibit A5 (23)

22 Exhibit A5 (13)

23 Exhibit A5 (23)

24 Exhibit A5 (AE6)

25 Exhibit R4 (24), (26)-(28), (30)

26 Exhibit A5 (AE15)

27 Exhibit A5 (AE8)

28 Exhibit A5 (AE15)

29 Exhibit A5 (13)

30 Exhibit A5 (AE22)

31 Exhibit A5 (AE22)

32 Exhibit A5 (20)

33 Exhibit A5 (21)

34 Exhibit A5 (23)

35 Exhibit A5 (25)

Printed by authority of the Commonwealth Government Printer

Maritime Union of Australia v Skilled Offshore (Australia) Pty Ltd