Neptune Asset Integrity Services Pty Ltd

[2016] FWCA 121

[2016] FWCA 121

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Neptune Asset Integrity Services Pty Ltd
(AG2015/6791)

NAI ENTERPRISE AGREEMENT 2016

Oil and gas industry
COMMISSIONER ROE	MELBOURNE, 8 JANUARY 2016

Application for approval of the NAI Enterprise Agreement 2016.

[1] An application has been made for approval of an enterprise agreement known as the NAI Enterprise Agreement 2016 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by Neptune Asset Integrity Services Pty Ltd (the employer and the Applicant). The Agreement is a single enterprise agreement.

Initial submissions by the AMWU, the AWU and the ETU

[2] The “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU), The Australian Workers Union and the Electrical Trades Union made the following submissions in objecting to the application for approval of the NAI Enterprise Agreement 2016:

“The work classifications described under the proposed agreement in the main describe a number of occupations covered under the three Unions’ eligibility rules and the Unions thus have a legitimate interest in industrial matters concerning such employees

The material before the FWC do not support the conclusions that an enterprise agreement has in fact been made in accordance with the provisions of s182 of the FW Act;
Despite the scope of coverage as indicated at Clause 4 of the proposed agreement being for work performed in Bass Strait and Victoria, it is apparent that none of the employee bargaining representatives identified in paragraph 5.3 of the Applicants F16 reside in Victoria;
There is no evidence before the FWC to indicate that the employees who voted on the proposed agreement were indeed “employed at the time” in the relevant enterprise as required under s181(1) of the FW Act;

There are reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees and that the FWC thus cannot be satisfied with respect to s188(c). Consequently, given the strict requirements of s186(2) the Unions submit that the FWC must not approve the agreement;
Section 186(2)(d) requires the FWC be satisfied that the proposed agreement passes the better off overall test… the application of this test… require employees to be engaged in the performance of the work to be covered by the proposed agreement at the relevant test time… which in this case would appear to be 24 November 2015;
Clause 5.1 (nominal expiry date of the agreement) is impermissibly vague... the FWC cannot be satisfied with respect to s186(5) of the FW Act;
S185(2) of the FW Act provides that an application… be accompanied by a signed copy of the agreement. It is noted that the copy of the proposed agreement available on the FWC website is not signed;

Under s180(5)(a) employers are required to take all reasonable steps to ensure that the terms of the agreement and the effects of those terms are explained to the relevant employees…the Applicant’s actions in this respect are on the face of it insufficient to meet the requirements of s180(5);
A simple review of Schedule B of the Manufacturing Award – ‘Classification Structure and Definitions’ reveals no appropriate classification definition for non-destructive testing technicians at the C10 level. It is therefore unclear to what extent the proposed agreement does in fact cover non-destructive testing technicians;
Based on the above initial submissions… the application for approval should be refused.”

[3] The AMWU, the AWU and the ETU went on to submit that the Agreement cannot be approved in accordance with the Full Bench decision in Cimeco Pty Ltd v CFMAU & Ors [2012] FWAFB 2206 which found that:

“it follows that the four employees working on the Marandoo agreement were not entitled to vote to approve the Midwest Agreement because at the time of the vote they did not fall within the area and scope of the agreement”

[4] I accept, that the Cimeco decision is authority for the proposition that employees who do not fall within the area and scope of the agreement are not eligible to vote to approve a proposed agreement.

Applicant’s response

[5] In response to the submissions made by the AMWU, the AWU and the ETU the Applicant made the following submissions:

“The Unions do not have standing or any other right to be heard in this Application. The matters identified in paragraph 2 of the Union Outline are insufficient in that respect;

The Commission should refuse to hear further from the Unions in respect of this Application. The Facts of the case and the nature of the Union Outline are substantially similar to those in Re MGI Piling (NSW) Pty Ltd and Re CSR Limited;

Indeed, the factual scenario in CSR is quite similar and it leads to the compelling conclusion that the Unions should not be further heard:

● None of the unions are bargaining representatives;
● There is no evidence that either Union has any member who would be covered by the Agreement;
● There is no evidence, claim or suggestion from any employee who will be covered by the Agreement that the statutory prerequisites for approval have not been satisfied

There is no evidence from the Unions that the statutory prerequisites for approval have not been satisfied;

The material filed in support of the application…clearly establish that the statutory prerequisites for approval have been satisfied;

Each of the contentions in paragraphs 3-18 of the Union Outline rely on the unsubstantiated assertion that the was “no evidence” to indicate that the persons who voted to approve the Agreement were employed in (or working in) the relevant enterprise at the time of the vote;

There is evidence in the form of four statutory declarations directly to this effect. There are seven employees employed at the time who will be covered, five of whom voted. The Agreement replaces the NAI Enterprise Bargaining Agreement 2013, which had relevantly identical coverage. The true position is that there is no evidence to the contrary;

Paragraphs 19-22 of the Union Outline have no substance;

Paragraph 25 of the Union Outline also has no substance and it involves misreading of the Harris Declaration… There is no reason why that evidence (in the form of two declarations) should not stand as proof of the matters there set out;

Paragraph 26 of the Union Outline is irrelevant comment. The Agreement plainly covers “non-destructive testing technicians”. In terms of the BOOT more generally, the highest weekly wage rate in either of the underpinning awards is $1,034.30. The lowest weekly wage rate in the Agreement is $1,828.18;

For these reasons, the Unions have nothing to add to the Application. The Commission should not further hear from them and on the strength of the materials before the Commission, approve the Agreement.”

[6] The Applicant went on to submit that in accordance with Riordan C in MGI Piling (NSW) Pty Ltd [2015] FWC 6387:

“[I]t would appear that the [Unions are] simply trying to find a technical breach upon which to mount an argument why the relevant Agreement should not be approved by the FWC… It is not the role of the [Unions] to interpose [themselves] into this position”

Preliminary findings

[7] Having considered the submissions made by the unions and the response of the employer I advised the Applicant and the unions that I was satisfied that:

● There are no issues regarding the signature requirements or the notice of employee representational rights;
● The requirements concerning the period of operation (Clause 5.1) will be resolved by noting that the period will be from four years from the date of approval and that the Agreement will come into operation seven days after approval;
● The comparison classification for Non-Destructive Testing Technician in the F17 Form is incorrect, however allowing for the potentially higher award classifications does not result in a BOOT issue.
● Concerns remained in relation to the matters raised in paragraphs 3 to 16 of the Unions submissions concerning the matters of genuine agreement.

[8] The unions did not raise objection to the conclusions reached. I sought further information from the Applicant in order to make a finding about the matters raised concerning genuine agreement and to determine if the Unions should be heard further.

Applicant’s further submissions

[9] The Applicant subsequently provided the requested information and made the following submission in relation to the remaining issues:

“Based on the information provided in the Form F17 (supported by the Form F18As) and the information contained in this email… the Commission can be satisfied that the requirements of section 182(1) and 186(2)(a) and 188 of the FW Act and all other relevant statutory considerations are met and must approve the Agreement;

…the NAI Enterprise Bargaining Agreement 2013 which was approved by the Fair Work Commission and mirrors the coverage of the Agreement subject to this Application. All of the employees who participated in the current Agreement-making process have engaged in work both offshore and onshore in Victoria under the 2013 Agreement
On this basis…the requirements of sections 182(1), 186(2) and 188 of the FW Act have been met.”

Conclusion

[10] Having considered all the material from the Applicant I am satisfied that the material demonstrates that:

● The employees who voted to make the Agreement have been engaged to work for the company in Bass Strait prior to the making of the Agreement. They have been engaged under the earlier agreement, the NAI Enterprise Bargaining Agreement 2013. There is work booked for the employees in 2016 which will come within the coverage of the agreement. The employees who voted or provided with the opportunity to vote were employed or were working in the relevant enterprise at the time of the vote;
● Employees were provided with adequate information about the agreement and its effect;
● The group of employees and their work is operationally and geographically distinct and is fairly chosen.

[11] I did not consider it necessary to hear further from the unions in respect to the matter. I considered that the material provided by the Applicant clearly resolved the matters in dispute.

[12] I am satisfied that the requirements of Sections 182(1), 186(2)(a) and 188 are met. I can see no basis for concluding that there are reasonable grounds for believing that the Agreement has not been genuinely agreed to by the employees.

[13] Pursuant to s.205(2) of the Act, the model consultation term prescribed by the Fair Work Regulations 2009 is taken to be a term of the Agreement.

[14] The Agreement was approved on 8 January 2016 and, in accordance with s.54, will operate from 15 January 2016. The nominal expiry date of the Agreement is 8 January 2020.

COMMISSIONER

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