MKJV Pty Ltd

[2019] FWCA 4715

[2019] FWCA 4715

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

MKJV Pty Ltd
(AG2019/1075)

MKJV ENTERPRISE AGREEMENT 2019

Building, metal and civil construction industries
DEPUTY PRESIDENT BEAUMONT	PERTH, 5 JULY 2019

Application for approval of the MKJV ENTERPRISE AGREEMENT 2019.

[1] MKJV Pty Ltd (MKJV) has made an application for the approval of an enterprise agreement known as the MKJV ENTERPRISE AGREEMENT 2019 (the Agreement). The application was made under s 185 of the Fair Work Act 2009 (Cth) (the Act). The Agreement is a single enterprise agreement.

[2] There were several issues identified concerning the pre-approval steps. The first concerned whether the Agreement had been ‘genuinely agreed’ to by the employees covered by the Agreement.

Genuinely agreed to – was there compliance with s180(5)

[3] Section 188(1) of the Act provides that an agreement has been genuinely agreed to by the employees covered by the 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.

[4] Further s 180(1) of the Act requires that before an employer requests a group of 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.

[5] 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 agreement. 1

[6] Whether s 180(5) has been complied with involves an evaluative judgment. 2 This is because the Commission must assess whether ‘reasonable steps were taken by the employer’.3 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 agreement to an employee.4

[7] The Form F17 stated that the Agreement covered three employees at the time of the vote and yet it included ten classifications for construction workers, and provided for nationwide coverage. 5 A small group of employees can fix the terms and conditions of employment of a larger group of employees who are later employed and covered by the Agreement.6 However, the issue remained whether the three employees who approved the Agreement were likely to have understood the terms of the Agreement and its effect.7

[8] MKJV was directed to file submissions and evidence in response to the first issue. Mr Dean Kearns, Director of MKJV, stated that the Agreement was expressed to cover all trade, craft and traditional ‘blue collar’ employees of MKJV. As such, it would not cover employees in administrative, supervisory, management and senior executive roles. 8

[9] The Form F17 set out in detail the steps taken to explain the terms of the Agreement and their effect. In addition, MKJV provided copies of the explanatory materials provided to the three employees. Explanation of the skills, qualifications and experience of each of the employees covered by the Agreement, who participated in the agreement making process, was provided to this Commission. Their experience in the construction sector was both impressive and extensive.

[10] I am satisfied that in the circumstances of this case, MKJV took all reasonable steps to explain the terms of the Agreement and their effect to the three employees. The steps taken were pragmatic, transparent, and considered the circumstances of the employees; all of whom had worked in the construction sector for many years. It was apparent that the experience of the employees and the explanatory material provided positioned them ask incisive questions, should they so choose, regarding the effect of the Agreement terms.

[11] There was no evidence before me to show that there was any other reason to conclude that the Agreement had not been genuinely agreed to by the employees covered by it.

Were the three employees employed at the time?

[12] On 12 June 2019, the Applicant was invited to provide submissions in light of the Full Bench’s recent decision in Construction, Forestry, Maritime, Mining and Energy Union v Noorton Pty Ltd t/as Manly Fast Ferry [2019] FWCFB 7224 (Manly Fast Ferry), as all of the employees with whom the Agreement was made were casual employees.

[13] In Manly Fast Ferry the Full Bench noted that ‘a person who is a casual employee but who is not working on a particular day or during a particular period, is unlikely to be employed on that day or during that period’, 9 and thus, unlikely to be ‘employed at the time’ as the phrase is relevant to the criteria in s 181 of the Act.

[14] In response to this invitation, the Applicant provided detailed written submissions, and a further witness statement of Mr Kerns. Attached to his witness statements were copies of employee records of the three employees (the employees) who voted to approve the Agreement and would be covered by it.

[15] Those employee records include copies of payments made to, and hours worked by, the employees from 4 March 2019 through 31 March 2019. Relevantly, this is the period in which the Agreement was negotiated and made. Having considered those records, I am satisfied that the employees were employed at the time, as the term is understood by s 181(1) of the Act.

Conclusion

[16] On the basis of the material contained in the application and accompanying statutory declaration, I am satisfied that each of the requirements of ss 186, 187 and 188 as are relevant to this application for approval have been met.

[17] The model flexibility term prescribed by the Fair Work Regulations 2009 (Cth) is attached to the Agreement and taken to be a term of it.

[18] The Agreement was approved on 5 July 2019 and, in accordance with s 54, will operate from 12 July 2019. The nominal expiry date of the Agreement is 4 July 2023.

DEPUTY PRESIDENT

 1   Coles Supermarkets Australia Pty Ltd v Shop, Distributive and Allied Employees Association Print T2319 [20].

 2   One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77 [105].

 3   Ibid.

 4 Ibid [103].

 5   Employers statutory declaration in support of the application for approval of an enterprise agreement (other than a greenfields agreement) of Dean Kearns dated 3 April 2019 (Form F17).

 6   ALDI Foods Pty Ltd v Shop, Distributive and Allied Employees Association [2017] HCA 53.

 7   One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77.

 8   Witness Statement of Dean Kearns dated 21 June 2019 (Kearns Statement) [4].

 9   Manly Fast Ferry [2019] FWCFB 7224 [22].

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