Mr Richard Dormer v Rio Tinto T/A Hailcreek Mine

[2014] FWC 1509

[2014] FWC 1548

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Tasmanian Ports Corporation Pty Ltd - Port Of Hobart T/A Tasports
(AG2013/12268)

COMMISSIONER LEE HOBART, 6 MARCH 2014

Application for approval of the Tasmanian Ports Corporation Pty Ltd (Tasports) Enterprise Agreement 2013.

[1] This matter involves the application for approval of a single enterprise agreement known as the Tasmanian Ports Corporation Pty Ltd (Tasports) Enterprise Agreement 2013 (the Agreement). The application has been made by Tasmanian Ports Corporation Pty Ltd T/A Tasports (Tasports) pursuant to section 185 of the Fair Work Act 2009 (the Act). The Agreement will apply to a range of employees of Tasports who are involved in the operation of the ports. The application was lodged with the Fair Work Commission (the Commission) on 30 December 2013.

[2] The Australian Maritime Officers’ Union (AMOU) lodged a Form F18 - Declaration of Employee Organisation in Relation to Application for Approval of Enterprise Agreement (Form F18) giving notice that it was a bargaining representative for the Agreement. Through the Form F18, the AMOU sought to be covered by the Agreement and indicated that it agreed with the answers given by Tasports in their Form F17 - Employer's Declaration in Support of Application for Approval of Enterprise Agreement (Form F17) and that the AMOU supported the approval of the agreement by the Commission.

[3] The Maritime Union of Australia (MUA) did not file a Form F18. On 2 January 2014, the MUA sent an email to the Sydney registry of the Commission which stated: “We are a default bargaining representative and a party to the above agreement. The agreement was filed for approval in the Fair Work Commission on 31 December 2014. We are seeking to be heard in this matter, and oppose the approval of the Agreement”.

[4] The agreement before me for approval was, according to the Form F17 completed by Ms. Beltz, the Human Resources Manager for Tasports, voted up by a majority of relevant employees, with 62 of the 120 votes cast in favour of approval of the Agreement. According to the F17, 141 employees are covered by the agreement. The MUA contend the agreement was not genuinely agreed to by the employees covered by the agreement in accordance with the Act.

Background to application for approval

[5] The MUA was involved in the negotiations for the agreement, along with the AMOU and two employee bargaining representatives from January 2013 until November 2013. The MUA submit that a “final position” was put to the bargaining representatives on 22 November 2013 by Tasports and that on 2 December 2013 Tasports commenced to circulate copies of the proposed agreement and other material to employees in order to commence the approval process.

[6] On 3 December 2014, Mr. Campbell, the State Secretary of the MUA wrote to Tasports expressing concern that negotiations had not concluded; that the MUA disputed the proposed agreement being circulated as it was not negotiated in good faith; that the MUA sought further discussions and that the MUA sought that the proposed agreement not be put out to vote. 1

[7] A ballot was conducted for the agreement that commenced on 11 December 2013 and concluded on 19 December 2013. The ballot agent was the Australian Electoral Commission (AEC). The result of the ballot was 62 of the 120 votes cast were in favour of the agreement. The application for the Commission to approve the agreement was lodged on 30 December 2013. As mentioned above, the MUA objection to approving the agreement was received on 2 January 2014.

Commission Proceedings

[8] Having received the objection, I listed the application for mention hearing by telephone on 17 January 2013. The MUA, the AMOU and Tasports attended the mention hearing. The AMOU advised at the mention hearing that they did not seek to make submissions. A timetable for filing submissions, witness statements and other materials was agreed and reflected in Directions issued by me on 22 January 2014. Both the MUA and Tasports indicated they thought the matter could be determined on the papers and did not seek the matter be listed for hearing. The directions noted that any bargaining representative could seek the matter be listed for hearing provided my chambers was notified by 17 February 2014. No request for a hearing was received. The MUA and Tasports filed submissions and relevant material in accordance with the directions set.

[9] The MUA filed submissions with 3 exhibits attached. Tasports filed submissions with 5 exhibits attached and a statutory declaration made by Mr. D Emery, the Manager Elections-State Office Tasmania for the Australian Electoral Commission.

Applicable legislation

[10] Before an agreement can be approved, the Commission must be satisfied that the requirements of the Act have been met. Part 2-4 of the Act provides for the making of enterprise agreements. Subdivision A of Division 4 of Part 2-4 (sections 180 - 185) deals with pre-approval steps and applications for the Commission to approve enterprise agreements. Subdivision B of Division 4 of Part 2-4 (sections 186-192) deals with approval of enterprise agreements by the Commission. Subdivision C of Division 4 of Part 2-4 (section 193) deals with the application of the better off overall test. I set out below the sections of the Act relevant to this application.

“Division 4—Approval of enterprise agreements

Subdivision A—Pre-approval steps and applications for the FWC’s approval

180 Employees must be given a copy of a proposed enterprise agreement etc.

Pre-approval requirements

(1) Before an employer requests under subsection 181(1) that employees approve a proposed enterprise agreement by voting for the agreement, the employer must comply with the requirements set out in this section.

Employees must be given copy of the agreement etc.

(2) The employer must take all reasonable steps to ensure that:

(a) during the access period for the agreement, the employees (the relevant employees) employed at the time who will be covered by the agreement are given a copy of the following materials:

(i) the written text of the agreement;

(ii) any other material incorporated by reference in the agreement; or

(b) the relevant employees have access, throughout the access period for the agreement, to a copy of those materials.

(3) The employer must take all reasonable steps to notify the relevant employees of the following by the start of the access period for the agreement:

(a) the time and place at which the vote will occur;

(b) the voting method that will be used.

(4) The access period for a proposed enterprise agreement is the 7-day period ending immediately before the start of the voting process referred to in subsection 181(1).

Terms of the agreement must be explained to employees etc.

(5) 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.

(6) Without limiting paragraph (5)(b), the following are examples of the kinds of employees whose circumstances and needs are to be taken into account for the purposes of complying with that paragraph:

(a) employees from culturally and linguistically diverse backgrounds;

(b) young employees;

(c) employees who did not have a bargaining representative for the agreement.

181 Employers may request employees to approve a proposed enterprise agreement

(1) An employer that will be covered by a proposed enterprise agreement may request the employees employed at the time who will be covered by the agreement to approve the agreement by voting for it.

(2) The request 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.

(3) Without limiting subsection (1), the employer may request that the employees vote by ballot or by an electronic method.

182 When an enterprise agreement is made

Single-enterprise agreement that is not a greenfields agreement

(1) If the employees of the employer, or each employer, that will be covered by a proposed single-enterprise agreement that is not a greenfields agreement have been asked to approve the agreement under subsection 181(1), the agreement is made when a majority of those employees who cast a valid vote approve the agreement.

Multi-enterprise agreement that is not a greenfields agreement

(2) If:

(a) a proposed enterprise agreement is a multi-enterprise agreement; and

(b) the employees of each of the employers that will be covered by the agreement have been asked to approve the agreement under subsection 181(1); and

(c) those employees have voted on whether or not to approve the agreement; and

(d) a majority of the employees of at least one of those employers who cast a valid vote have approved the agreement;

the agreement is made immediately after the end of the voting process referred to in subsection 181(1).

…

183 Entitlement of an employee organisation to have an enterprise agreement cover it

(1) After an enterprise agreement that is not a greenfields agreement is made, an employee organisation that was a bargaining representative for the proposed enterprise agreement concerned may give the FWC a written notice stating that the organisation wants the enterprise agreement to cover it.

(2) The notice must be given to the FWC, and a copy given to each employer covered by the enterprise agreement, before the FWC approves the agreement.

Note: The FWC must note in its decision to approve the enterprise agreement that the agreement covers the employee organisation (see subsection 201(2)).

Subdivision B—Approval of enterprise agreements by the FWC

186 When the FWC must approve an enterprise agreement—general requirements

Basic rule

(1) If an application for the approval of an enterprise agreement is made under section 185, the FWC must approve the agreement under this section if the requirements set out in this section and section 187 are met.

Note: The FWC may approve an enterprise agreement under this section with undertakings (see section 190).

Requirements relating to the safety net etc.

(2) The FWC must be satisfied that:

(a) if the agreement is not a greenfields agreement—the agreement has been genuinely agreed to by the employees covered by the agreement; and

(b) if the agreement is a multi-enterprise agreement:

(i) the agreement has been genuinely agreed to by each employer covered by the agreement; and

(ii) no person coerced, or threatened to coerce, any of the employers to make the agreement; and

(c) the terms of the agreement do not contravene section 55 (which deals with the interaction between the National Employment Standards and enterprise agreements etc.); and

(d) the agreement passes the better off overall test.

Note 1: For when an enterprise agreement has been genuinely agreed to by employees, see section 188.

Note 2: The FWC may approve an enterprise agreement that does not pass the better off overall test if approval would not be contrary to the public interest (see section 189).

Note 3: The terms of an enterprise agreement may supplement the National Employment Standards (see paragraph 55(4)(b)).

Requirement that the group of employees covered by the agreement is fairly chosen

(3) The FWC must be satisfied that the group of employees covered by the agreement was fairly chosen.

(3A) 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.

Requirement that there be no unlawful terms

(4) The FWC must be satisfied that the agreement does not include any unlawful terms (see Subdivision D of this Division).

Requirement that there be no designated outworker terms

(4A) The FWC must be satisfied that the agreement does not include any designated outworker terms.

Requirement for a nominal expiry date etc.

(5) The FWC must be satisfied that:

(a) the agreement specifies a date as its nominal expiry date; and

(b) the date will not be more than 4 years after the day on which the FWC approves the agreement.

Requirement for a term about settling disputes

(6) The FWC must be satisfied that the agreement includes a term:

(a) that provides a procedure that requires or allows the FWC, or another person who is independent of the employers, employees or employee organisations covered by the agreement, to settle disputes:

(i) about any matters arising under the agreement; and

(ii) in relation to the National Employment Standards; and

(b) that allows for the representation of employees covered by the agreement for the purposes of that procedure.

Note 1: The FWC or a person must not settle a dispute about whether an employer had reasonable business grounds under subsection 65(5) or 76(4) (see subsections 739(2) and 740(2)).

Note 2: However, this does not prevent the FWC from dealing with a dispute relating to a term of an enterprise agreement that has the same (or substantially the same) effect as subsection 65(5) or 76(4).

187 When the FWC must approve an enterprise agreement—additional requirements

Additional requirements

(1) This section sets out additional requirements that must be met before the FWC approves an enterprise agreement under section 186.

Requirement that approval not be inconsistent with good faith bargaining etc.

(2) The FWC must be satisfied that approving the agreement would not be inconsistent with or undermine good faith bargaining by one or more bargaining representatives for a proposed enterprise agreement, or an enterprise agreement, in relation to which a scope order is in operation.

Requirement relating to notice of variation of agreement

(3) If a bargaining representative is required to vary the agreement as referred to in subsection 184(2), the FWC must be satisfied that the bargaining representative has complied with that subsection and subsection 184(3) (which deals with giving notice of the variation).

Requirements relating to particular kinds of employees

(4) The FWC must be satisfied as referred to in any provisions of Subdivision E of this Division that apply in relation to the agreement.

Note: Subdivision E of this Division deals with approval requirements relating to particular kinds of employees.

Requirements relating to greenfields agreements

(5) If the agreement is a greenfields agreement, the FWC must be satisfied that:

(a) the relevant employee organisations that will be covered by the agreement are (taken as a group) entitled to represent the industrial interests of a majority of the employees who will be covered by the agreement, in relation to work to be performed under the agreement; and

(b) it is in the public interest to approve the agreement.

188 When employees have genuinely agreed to an enterprise agreement

An enterprise agreement has been genuinely agreed to by the 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.

…

190 FWC may approve an enterprise agreement with undertakings

Application of this section

(1) This section applies if:

(a) an application for the approval of an enterprise agreement has been made under section 185; and

(b) the FWC has a concern that the agreement does not meet the requirements set out in sections 186 and 187.

Approval of agreement with undertakings

(2) The FWC may approve the agreement under section 186 if the FWC is satisfied that an undertaking accepted by the FWC under subsection (3) of this section meets the concern.

Undertakings

(3) The FWC may only accept a written undertaking from one or more employers covered by the agreement if the FWC is satisfied that the effect of accepting the undertaking is not likely to:

(a) cause financial detriment to any employee covered by the agreement; or

(b) result in substantial changes to the agreement.

FWC must seek views of bargaining representatives

(4) The FWC must not accept an undertaking under subsection (3) unless the FWC has sought the views of each person who the FWC knows is a bargaining representative for the agreement.

Signature requirements

(5) The undertaking must meet any requirements relating to the signing of undertakings that are prescribed by the regulations.

191 Effect of undertakings

(1) If:

(a) the FWC approves an enterprise agreement after accepting an undertaking under subsection 190(3) in relation to the agreement; and

(b) the agreement covers a single employer;

the undertaking is taken to be a term of the agreement, as the agreement applies to the employer.

(2) If:

(a) the FWC approves an enterprise agreement after accepting an undertaking under subsection 190(3) in relation to the agreement; and

(b) the agreement covers 2 or more employers;

the undertaking is taken to be a term of the agreement, as the agreement applies to each employer that gave the undertaking.

192 When the FWC may refuse to approve an enterprise agreement

(1) If an application for the approval of an enterprise agreement is made under section 185, the FWC may refuse to approve the agreement if the FWC considers that compliance with the terms of the agreement may result in:

(a) a person committing an offence against a law of the Commonwealth; or

(b) a person being liable to pay a pecuniary penalty in relation to a contravention of a law of the Commonwealth.

(2) Subsection (1) has effect despite sections 186 and 189 (which deal with the approval of enterprise agreements).

(3) If the FWC refuses to approve an enterprise agreement under this section, the FWC may refer the agreement to any person or body the FWC considers appropriate.

Subdivision C—Better off overall test

193 Passing the better off overall test

When a non-greenfields agreement passes the better off overall test

(1) An enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if the 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.

FWC must disregard individual flexibility arrangement

(2) If, under the flexibility term in the relevant modern award, an individual flexibility arrangement has been agreed to by an award covered employee and his or her employer, the FWC must disregard the individual flexibility arrangement for the purposes of determining whether the agreement passes the better off overall test.

When a greenfields agreement passes the better off overall test

(3) A greenfields agreement passes the better off overall test under this section if the FWC is satisfied, as at the test time, that 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.

Award covered employee

(4) An award covered employee for an enterprise agreement is an employee who:

(a) is covered by the agreement; and

(b) at the test time, is covered by a modern award (the relevant modern award) that:

(i) is in operation; and

(ii) covers the employee in relation to the work that he or she is to perform under the agreement; and

(iii) covers his or her employer.

Prospective award covered employee

(5) A prospective award covered employee for an enterprise agreement is a person who, if he or she were an employee at the test time of an employer covered by the agreement:

(a) would be covered by the agreement; and

(b) would be covered by a modern award (the relevant modern award) that:

(i) is in operation; and

(ii) would cover the person in relation to the work that he or she would perform under the agreement; and

(iii) covers the employer.

Test time

(6) The test time is the time the application for approval of the agreement by the FWC was made under section 185.

FWC may assume employee better off overall in certain circumstances

(7) For the purposes of determining whether an enterprise agreement passes the better off overall test, 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 modern award applied to that class, the FWC 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.”

The issue for determination

[11] The MUA submits that I should not approve the agreement as it was not genuinely agreed to by the employees covered. The basis for this submission is set out clearly in paragraphs 19 to 30 of their written submissions. My summary of the MUA submission follows:

• The ballot notice sent to employees provided a choice of voting, either by post or in person at a polling station.



• That if an employee voted by post, and then in person at a polling station, the employees postal vote would not be counted.



• Only a bear majority (52%) of employees who voted were in favour of the agreement and only 120 employees (out of a possible 141 employees) voted at all.



• That the material provided to the Commission does not reveal the method by which the ballot was conducted (e.g. whether employees were identified when voting or if it was a secret ballot)



• The ballot paper returnable to the AEC was not included in the materials filed with FWC



• The notice to employees stated that they were permitted to vote twice, once by postal vote and then at a polling station and that if an employee votes at a polling station after they voted by postal vote then their postal vote would not be counted.



• That a number of employees did in fact vote twice for the agreement.



• That having regard to all of the above, there is insufficient evidence before the Commission as to the steps taken by AEC to avoid a double vote or voting incorrectly because the employee voted twice by post, and in person.



• Given the doubts regarding the ballot process and the result of the ballot being a bare majority, it is open to the Commission to not be satisfied that the agreement was not genuinely agreed to by the employees covered by the agreement, and the agreement should not be approved by the Commission.

[12] The MUA also submitted that, should I determine that the agreement should be approved, notwithstanding their objections, they seek to be covered by the agreement in accordance with section 183 of the Act.

[13] Tasports submits that the pre-approval requirements of the Act have been met and that the agreement should be approved.

[14] In their submission, Tasports set out the steps taken to notify employees covered by the agreement of the voting process as follows:

“5. Employees were notified of the voting process by:

a) On 2 December 2013 a letter from Tasports was sent to the home address of each employee (Attachment A). This document was attached to Tasports' Form F17 with respect to section 2.5;

b) On 2 December 2013 an email from Tasports to each employee (all full-time and part-time employees, and most casual employees, have a designated corporate email address) (Attachment B). This document was attached to Tasports' Form F17 with respect to section 2.2 and 2.4;

c) On 6 December 2013 a Notice of Ballot prepared by the Australian Electoral Commission (AEC) was made available on the intranet (Attachment C). A copy of this document was included in the MUA's submissions of 3 February 2014 and marked as 'TAS3'.

d) On 11 December 2013 a Staff Bulletin was posted on Tasports intranet and sent via post to each employee's home address (Attachment D). A copy of this document was included in the MUA's submissions of 3 February 2014 but was unmarked.

e) From 2 December 2013 onwards Tasports met with each work group to discuss the voting process and other matters associated with the Agreement.

f) On 17 December Tasports sent an email to each employee (Attachment E). This document was attached to Tasports' Form F17 with respect to section 2.5.”

[15] The Tasports submission refers to the decision in McDonalds Pty Ltd 2 where the Full Bench confirmed that the employer need only take reasonable steps to meet the requirement of section 180(3) of the Act and that it is not necessary to “...establish in a definitive way that all employees were in fact informed of the matters”3 and that the test is not an “absolute requirement to ensure that particular outcomes are achieved”.4

[16] The approach taken in McDonalds Pty Ltd 5 remains the correct approach. Applying the facts in this matter to the approach determined in McDonalds Pty Ltd6, there is no doubt that the multiple forms of communication, and the content of that communication in evidence, undertaken by Tasports to communicate the voting process to their employees satisfies the requirement to take reasonable steps to notify the employees of the time and place at which the vote was to occur and of the voting method that was to be used.

[17] The submissions of Tasports also dealt with the possibility raised by the MUA that employees who voted twice may have had their vote double counted. The response of Tasports on this matter relies on a statutory declaration provided by Mr Dale Emery, Manager Elections - State Office Tasmania of the AEC. I agree that the statutory declaration of Mr. Emery makes it clear that each employee was given an opportunity to vote and that a majority of the employees who cast a valid vote voted in support of the agreement.

[18] As to the issue of potential double counting, the statutory declaration of Mr. Emery made the following points:

“At Hobart the first step was to identify who voted by attendance from the returned lists, and determine whether a postal vote was also received from that elector. Where an employee has voted by both postal and attendance, the postal ballot is put aside, unopened, and is not counted. The AEC identified 3 employees that had voted by both postal and attendance ballot. These postal votes remained opened and were not included in the ballot.” 7

[19] The evidence of Mr. Emery makes clear the process followed did not allow for the double counting of votes in this ballot and that a majority of the employees who cast a valid vote voted in support of the agreement. Accordingly, an agreement was made between the employees covered by the agreement and Tasports in the manner contemplated in section 182(1) of the Act.

[20] The objections raised by the MUA to approval of the application are therefore dismissed.

Other matters:

[21] Having further considered the application for approval of this agreement, there remain two concerns that will need to be satisfied before I can approve the agreement. They have not been raised with the parties prior to this time. I will write to the parties in relation to those outstanding matters in due course.

COMMISSIONER

Final written submissions:

Maritime Union of Australia, 3 February 2014

Applicant, 14 February 2014

 1   Maritime Union of Australia Outline of Submissions, exhibit “TAS 2”, filed 3 February 2014

 2   [2010] FWAFB 4602

 3   McDonalds Pty Ltd, [2010] FWAFB 4602, [25]

 4   McDonalds Pty Ltd, [2010] FWAFB 4602, [29]

 5   [2010] FWAFB 4602

 6   [2010] FWAFB 4602

 7   Statutory Declaration of Dale Emery, sworn 14 February 2014, [8] - [10]

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