P J Connolly Pty Ltd

[2018] FWCA 6776

[2018] FWCA 6776

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement

P J Connolly Pty Ltd
(AG2018/2590)

P J CONNOLLY PTY LTD ENTERPRISE AGREEMENT 2018 - 2022

Building, metal and civil construction industries
COMMISSIONER WILSON	MELBOURNE, 1 NOVEMBER 2018

Application for approval of the P J Connolly Pty Ltd Enterprise Agreement 2018 - 2022.

[1] This decision concerns an application by P J Connolly Pty Ltd for approval by the Fair Work Commission (the Commission) pursuant to the provisions of the Fair Work Act 2009 (the Act) of the P J Connolly Pty Ltd Enterprise Agreement 2018 – 2022 (the Agreement).

[2] While P J Connolly Pty Ltd propose that the application is capable of approval, albeit with two undertakings to be received by the Commission pursuant to s.190 of the Act, the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) argue that the Agreement is incapable of approval for reason of failures in the bargaining process which had the effect of excluding the CFMMEU as a bargaining agent, with the related consequence that the Commission is unable to be satisfied that the Agreement has been genuinely agreed to in the manner provided for in s.188 of the Fair Work Act 2009 (the Act).

[3] P J Connolly Pty Ltd also argued that the CFMMEU has no right to be heard before the Commission on the subject since they are not a bargaining agent.

[4] Other than the matter of the two undertakings alluded to above, and discussed in greater detail below, it is not argued by any party that the Agreement is unable to be approved for reason of it not passing the better off overall test.

[5] This decision deals with the following matters:

•  Whether the CFMMEU is entitled to be heard in relation to this application;

•  Whether the matters raised by the CFMMEU would lead the Commission to be of the view that the Agreement has not been genuinely agreed by the employees to be covered by it; and

•  Whether for any other reason the application should not be approved, or whether, in the alternative, the Agreement should be approved with the undertakings put forward by P J Connolly Pty Ltd.

BACKGROUND

[6] Phillip Connolly, the Managing Director of P J Connolly Pty Ltd has provided a Form F17 Employer Statutory Declaration in support of his company’s application for approval of an enterprise agreement which indicates the following background information:

•  Employees of the company were notified of the intention of their employer to initiate or agree to bargain for an enterprise agreement on 4 May 2018. On the same day the Notice of Employee Representational Rights (NERR) was provided to employees; and

•  The NERR informs employees the company is giving notice “that it is bargaining in relation to an enterprise agreement PJ Connolly Pty Ltd Enterprise Agreement 2018 – 2022 which is proposed to cover employees that are engaged to work in the building and construction industry” (original italics);

[7] Voting for the proposed Agreement commenced and ended on 1 June 2018. The statutory declaration indicates there will be 47 employees to be covered by the Agreement and that all of those employees both cast a valid vote and voted to approve the proposed Agreement.

[8] Other material provided to the Commission at the time of making the application for approval discloses that 46 of the 47 employees nominated themselves in writing as a bargaining representative for the Agreement, with one employee nominating another employee as their bargaining representative. Additionally, each employee signed written instructions to their employer regarding the use of their personal contact details. Those two documents, the employee bargaining representative nomination form (Nomination Document) and the personal contact privacy request document (Privacy Document) form the basis of the CFMMEU’s contentions to the Commission in relation to whether the Agreement has been genuinely agreed to. These documents are also at the centre of the Applicant’s submissions opposing CFMMEU’s standing as a bargaining representative and therefore their standing to be heard in the approval proceedings.

[9] The Nomination Document is in a standard format between each of the employees, with each of the signed documents providing the following:

“NOTICE OF APPOINTMENT OF A BARGAINING AGENT IN

ACCORDANCE WITH

5176 FAIR WORK ACT (CTH) 2009

I, [employee name removed]an employee engaged with P J Connolly Pty Ltd (ABN: 74 150 369 798) hereby appoint:

Please tick one:

□ myself

□ my nominated employee representative:

□ my legal representative /solicitor:

□ my nominated employee association /union of which I am / am not a member:

□ Other (please specify):

to act on my behalf as bargaining agent pursuant to S176(c) of the Fair Work Act

(Cth) 2009.

I certify that I have received notification of my rights and entitlements under s174 of the Fair Work Act (Cth) 2009 by virtue of having been issued with Schedule 2.1 under Regulation 2.05 of the Fair Work Act Regulations 2009 on [date removed].

Date:

Signed

…”

[10] Similarly the Privacy Document is also in standardised form with it reading as follows:

“I, [employee name removed] instruct my employer P J Connolly Pty Ltd for privacy reasons, not to use my person contact details regarding all documentation concerning the Enterprise Bargaining Process.

[Employee signature removed] [Date removed]

[Employee name removed]”

[11] It is accepted before me that, if not for the appointment of each employee of themselves as their bargaining representative, the CFMMEU would be the default bargaining representative within the meaning of s.176(1)(b) of the Act.

[12] A second statutory declaration provided by Mr Connolly to the Commission following Directions given by me prior to the hearing of the matters in contention sets out the process by which employees were provided with the various documents referred to above and requested to vote on the proposed agreement:

“Issuing of bargaining nomination forms to the employees

1. I issued the bargaining nomination forms along with the Schedule 2.1 and the privacy form. Each of these documents was placed on a table in a bundled form and issued to each employee.

2. As each employee took from the pile, I explained what each document was. This allowed for personal discussion with each individual as to what each document entailed.

3. I then allowed enough time for employees to read the documents for themselves and ask questions.

Date and time of distribution

4. The majority of the documents, I believe 45 of them, were given out to the employees on 1 May 2018 between the hours of 0650 and 1420.

5. The remaining 2 employees had their documents hand delivered to them on 4 May 2018, between 1400 and 1530, because they were on holiday at the time of the initial run.

…

The circumstances of the issuing of those forms

8. The circumstances were that the employees were informed that we were to commence the bargaining process of a new EA, and they were informed of the relevant documents and the process that would follow

What was said I were any instructions issued?

9. The forms were issued separately and each form spoken about.

10. The employees were told that all information they provided would be private as per the privacy form, they were informed as to their rights of representation described in the Schedule 2.1.

11. The employees were encouraged to read the documents provided to them, they were also issued with a bargaining nomination form that was discussed. It was made clear to them that they could nominate any of the following entities:

a. themselves,

b. another person within the company,

c. a legal representative,

d. the union or

e. any other person they deemed fit to represent them in the negotiation phase of this agreement.

Were the documents issued to all 47 employees?

12. Yes, each employee received all 3 documents and all were encouraged to read them, and return the nomination form and privacy notice when they had filled it out and to hold onto the notice of employee representational rights.” 1

[13] As part of the Directions the Applicant, P J Connolly Pty Ltd, was required to provide to the Commission the contact details of each of the employees who had appointed themselves as employee bargaining representatives and who would be bound by the proposed Agreement. In addition, the CFMMEU was required to provide details to the Commission of the names of each member of the union it knew to be an employee of P J Connolly Pty Ltd. The material provided by each party, once received by the Commission was then not disclosed to the other, in order to maintain the confidentiality of the people concerned.

[14] A consideration of the names of members provided by the CFMMEU confirms the broad contention made by the union, to the effect that it had members employed by PJ Connolly Pty Ltd at the time the proposed Agreement was under consideration.

[15] Having received from the Applicant the contact details of each of the employee bargaining representatives, my Associate wrote to each person giving them an opportunity to make such submissions about the approval of the Agreement as they may wish. The correspondence sent from my Chambers dated 16 October 2018 was in the following terms:

“Dear [employee name removed],

An application has been made to the Fair Work Commission for approval of the PJ Connolly Pty Ltd enterprise agreement 2018 – 2022.  The reference number for this agreement is AG 2018/2590 and consideration of its approval has been referred to Commissioner Wilson.

Material filed by PJ Connolly Pty Ltd indicates that you have appointed yourself as an employee bargaining representative in the negotiation of this agreement.  On the other hand the CFMMEU has provided information to the Commission that you are a member of that union.

The CFMMEU’s assertion that you are a member of that union has not been detailed to PJ Connolly Pty Ltd or its representatives.

The CFMMEU objects to the approval of the agreement on a number of grounds, including that you did not have an adequate opportunity to participate in the negotiation of the agreement or to involve the CFMMEU as your bargaining agent.  The union also objects to a number of other matters both as to the process for negotiation of the agreement as well is its content.  Should you wish to obtain a copy of either the CFMMEU’s objections to the approval of this agreement or material which has been filed by the representatives for PJ Connolly Pty Ltd in support of approval of the application you may request that by return email.

The subject of whether the agreement may be approved will be heard before Commissioner Wilson on Monday, 22 October 2018 at 10:00 AM.

Should you wish to appear at that hearing either yourself or through a representative you may do so.

Should you wish to provide any material prior to the hearing relevant to its approval you may also do so; however any information you do wish to be provided must be forwarded to Commissioner Wilson's Chambers by no later than 12:00 PM Friday, 19 October 2018.  If you do provide any information or material relevant to the approval of the agreement it may be that that material must be disclosed to the CFMMEU as well as the representatives of PJ Connolly Pty Ltd; however if Commissioner Wilson forms the view that it needs to be disclosed, you will be consulted about the subject before it is provided.

Kind regards,

…”

[16] Also on 16 October 2018 the Applicant and the CFMMEU were advised that the Commission had written to each employee bargaining representatives as set out above.

[17] None of the employee bargaining representatives made contact with the Commission after the foregoing correspondence was provided to them.

[18] Part of the background to the Agreement now before the Commission is a bargaining dispute which was dealt with by Commissioner McKinnon in May 2018. That matter was dealt with in the usual manner through a conference aimed at eliciting the agreement of the parties about the matters said to be in dispute. The matter appears not to have been the subject of any proceedings on the record and it is the case that there is no published decision, statement or recommendation following the conference upon which the Commission now constituted may rely. P J Connolly Pty Ltd argue in relation to the bargaining dispute before Commissioner McKinnon:

“5. A hearing before Commissioner McKinnon was called where submissions and evidence were tendered. The Union failed to satisfy the Commission that they were a bargaining representative and the matter was stood down.”

…

17. …

…

(b) A list of the Applicant’s employees was provided to Commissioner McKinnon on 31 May 2018 as part of the ‘Good faith bargaining orders’ hearing (where the Commissioner refused to accept that the Union was a bargaining representative).” 2

[19] While the CFMMEU concedes that the union did not have the ability in May 2018 to satisfy the Commission of its status as a bargaining representative, the CFMMEU submits that the Commissioner did not at that time have before her the content of the notices of appointment now before the Commission. It says as a result that any determinations that may have been made by the Commissioner in the context of the bargaining dispute are not particularly relevant in these proceedings.

STANDING OF THE CFMMEU

[20] The CFMMEU contends that it has the requisite standing to be heard in relation to the Commission’s consideration of this Agreement. It argues both that the union remains as a bargaining agent as it has members employed by the Applicant and had members employed during the bargaining and voting period and alternatively, that it has standing to be heard in accordance with s.590(1) of the Act and CFMEU v Collinsville Coal Operations Pty Ltd. 3

[21] As discussed above, part of my Directions issued to parties on 25 September 2018 directed P J Connolly to:

“File in the Commission and serve on all parties a list of all employee bargaining representatives email contact details;”

[22] At the same time I directed the CFMMEU to:

“File in the Commission all material on which they seek the Commission to rely on when determining their position as a bargaining representative for the Agreement in accordance with s.176(1)(b) of the Act including a list of all its members who were employed by the Applicant at the time of the vote and a Form F18”

[23] Both P J Connolly and the CFMMEU provided the lists requested however, the CFMMEU did not provide a Form F18. A review of the lists showed that the CFMMEU had 16 members who would be covered by the Agreement, all of whom had elected to represent themselves during bargaining. As such, I concluded that while the CFMMEU may have been a default bargaining representative for a period of time between 1 to 4 May 2018, they ceased to be a bargaining representative between 1 to 4 May 2018 when each of their members elected to represent themselves as a bargaining representative by completing the Nomination Document as such. The CFMMEU therefore does not have the standing of a bargaining representative in these proceedings.

[24] As to the CFMMEU’s submissions with respect to s.590(1) of the Act and CFMEU v Collinsville Coal Operations Pty Ltd I also find that it is not appropriate to hear the CFMMEU in accordance with that section.

[25] Section 590(1) of the Act relevantly provides as follows:

“590 Powers of the FWC to inform itself

(1) The FWC may, except as provided by this Act, inform itself in relation to any matter before it in such manner as it considers appropriate.”

[26] The wording of s.590(1) of the Act does not automatically give the CFMMEU standing to be heard, rather it provides a mechanism for the Commission to allow the CFMMEU to provide submissions should the Commission consider it to be appropriate. In some cases the CFMMEU’s expertise in the building, metal and civil construction industries may assist the Commission should the concerns raised go to issues surrounding the better off overall test about which the CFMMEU may be in a position to add value to the Commission’s decision making process. However, in the present matter given the issues in dispute stem from the bargaining process, to which the CFMMEU was not a party, it is difficult to see what if any insight they could provide the Commission. This view is further cemented by the fact that the CFMMEU provided no direct evidence on the process of what occurred during bargaining. In fact the submissions simply commented on the processes described in the Applicant’s documents, particular the statutory declaration of Mr Connolly. The CFMMEU did not seek to cross-examine Mr Connolly on the matters within his statutory declarations or to adduce its own evidence. As such, I cannot see what insight the CFMMEU could provide to warrant a use of s.590(1) of the Act.

[27] Additionally, in CFMEU v Collinsville Coal Operations Pty Limited 4 the Full Bench found that simply being a bargaining representative at some time during bargaining, which has ceased before the agreement is made, does not result in a party automatically being given standing. The Full Bench stated that:

“[38] It does not follow however that the capacity of an employee organisation, which is no longer a bargaining representative, to give notice under s.183, results in the organisation having standing to make submissions or to otherwise be heard in opposition to an application approval of an agreement. Section 183 is of limited utility. It serves only to alert the Commission to the fact that an employee organisation that was a bargaining representative for the proposed agreement now wishes to be covered by the agreement. The result of a valid notice under s.183 is that the employee organisation will be noted in the decision approving the agreement as being covered by the agreement.” 

[28] The Commission therefore refuses the CFMMEU request that it be heard in relation to approval of the Agreement.

GENUINE AGREEMENT

[29] The CFMMEU put forth two arguments against the Agreement having been genuinely agreed to by employees. Firstly, the CFMMEU submitted that by attaching the Nomination Document to the Notice of Representational Rights (NERR) that P J Connolly altered the prescribed form of the NERR, rendering it invalid under s.174(1A) and (1B) of the Act with the consequence being a lack a genuine agreement under s.188 of the Act. Secondly, the CFMMEU put forth that the form and content of the Nomination Document along with the process of providing the Nomination and Privacy Documents to employees at the same time as the NERR created a scenario whereby employees believed that they had to make a choice as to who their bargaining representative was during negotiations which in turn misled employees about their rights under s.176(1)(b)(i) of the Act.

[30] P J Connolly Pty Ltd opposes the CFMMEU submissions in full. In the first instance P J Connolly Pty Ltd submits that the CFMMEU submissions should not be heard as they are not a bargaining representative to the Agreement nor should the CFMMEU submissions be considered by the Commission under its powers to inform itself at s.590 of the Act given the CFMMEU weren’t present for the pre-approval stage nor have they provided any direct evidence of what occurred during this time. Secondly, P J Connolly submits that a valid NERR was issued to employees in the prescribed form and therefore the Agreement has been genuinely agreed to by employees as required by s.188 of the Act.

[31] The Commission must approve an enterprise agreement if, relevantly, the requirements set out in ss.186 and 187 of the Act are met. Subsection 186(2) provides:

“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 ...”

[32] Section 188 deals with when employees have ‘genuinely agreed’ to an enterprise agreement, it provides:

“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:

...

(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.”

[33] Section 181 provides:

“(1) An employer that will be covered by a proposed enterprise agreement may request the employees covered 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 ...”

[34] Section 173 of the Act relevantly prescribes that:

“173 Notice of employee representational rights

Employer to notify each employee of representational rights

(1) An employer that will be covered by a proposed enterprise agreement that is not a

greenfields agreement must take all reasonable steps to give notice of the right to be

represented by a bargaining representative to each employee who:

(a) will be covered by the agreement; and

(b) is employed at the notification time for the agreement.

Note: For the content of the notice, see section 174.

...”

[35] Section 174 which deals with the content and form of the NERR then states:

“174 Content and form of notice of employee representational rights
Application of this section

(1) This section applies if an employer that will be covered by a proposed enterprise agreement is required to give a notice under subsection 173(1) to an employee.

Notice requirements

(1A) The notice must:

(a) contain the content prescribed by the regulations; and
(b) not contain any other content; and
(c) be in the form prescribed by the regulations.

(1B) When prescribing the content of the notice for the purposes of paragraph (1A)(a), the regulations must ensure that the notice complies with this section.

Content of notice—employee may appoint a bargaining representative

(2) The notice must specify that the employee may appoint a bargaining representative to represent the employee:

(a) in bargaining for the agreement; and
(b) in a matter before the FWC that relates to bargaining for the agreement.

Content of notice—default bargaining representative

(3) If subsection (4) does not apply, the notice must explain that:

(a) if the employee is a member of an employee organisation that is entitled to represent the industrial interests of the employee in relation to work that will be performed under the agreement; and
(b) the employee does not appoint another person as his or her bargaining representative for the agreement;

the organisation will be the bargaining representative of the employee.

Content of notice—bargaining representative if a low-paid authorisation is in operation

(4) If a low-paid authorisation in relation to the agreement that specifies the employer is in operation, the notice must explain the effect of paragraph 176(1)(b) and subsection 176(2) (which deal with bargaining representatives for such agreements).

Content of notice—copy of instrument of appointment to be given

(5) The notice must explain the effect of paragraph 178(2)(a) (which deals with giving a copy of an instrument of appointment of a bargaining representative to an employee’s employer).”

[36] Regulation 2.05 of the Fair Work Regulations 2009 (FW Regulations) provides:

“2.5 Notice of employee representational rights—prescribed form

For subsection 174(6) of the Act, the notice of employee representational rights in Schedule 2.1 is prescribed.”

[37] Schedule 2.1 of the FW Relations provides the prescribed form and content of the NERR as follows:

“Schedule 2.1 – Notice of employee representational rights

(regulation 2.05)

Fair Work Act 2009, subsection 174(1A)

[Name of employer] gives notice that it is bargaining in relation to an enterprise agreement ([name of the proposed enterprise agreement]) which is proposed to cover employees that [proposed coverage].

What is an enterprise agreement?

An enterprise agreement is an agreement between an employer and its employees that will be covered by the agreement that sets the wages and conditions of those employees for a period of up to 4 years.  To come into operation, the agreement must be supported by a majority of the employees who cast a vote to approve the agreement and it must be approved by an independent authority, Fair Work Commission.

If you are an employee who would be covered by the proposed agreement:

You have the right to appoint a bargaining representative to represent you in bargaining for the agreement or in a matter before Fair Work Commission about bargaining for the agreement.

You can do this by notifying the person in writing that you appoint that person as your bargaining representative. You can also appoint yourself as a bargaining representative. In either case you must give a copy of the appointment to your employer.

[If the agreement is not an agreement for which a low-paid authorisation applies--include:]

If you are a member of a union that is entitled to represent your industrial interests in relation to the work to be performed under the agreement, your union will be your bargaining representative for the agreement unless you appoint another person as your representative or you revoke the union's status as your representative.

[If a low-paid authorisation applies to the agreement--include:]

Fair Work Commission has granted a low-paid bargaining authorisation in relation to this agreement.  This means the union that applied for the authorisation will be your bargaining representative for the agreement unless you appoint another person as your representative, or you revoke the union's status as your representative, or you are a member of another union that also applied for the authorisation.

[if the employee is covered by an individual agreement-based transitional instrument--include:]

If you are an employee covered by an individual agreement:

If you are currently covered by an Australian Workplace Agreement (AWA), individual transitional employment agreement (ITEA) or a preserved individual State agreement, you may appoint a bargaining representative for the enterprise agreement if:

• the nominal expiry date of your existing agreement has passed; or

• a conditional termination of your existing agreement has been made (this is an agreement made between you and your employer providing that if the enterprise agreement is approved, it will apply to you and your individual agreement will terminate).

Questions?

If you have any questions about this notice or about enterprise bargaining, please speak to your employer or bargaining representative, or contact the Fair Work Ombudsman or the Fair Work Commission.”

[38] The CFMMEU’s arguments in relation to the invalidity of the Nomination Document stems from its understanding that what was provided to employees in the coffee shop meetings referred to by Mr Connolly was a bundle of documents, provided in such a way that the Commission cannot be satisfied that the Applicant has conformed with its obligations in respect of the NERR. Its submissions on these matters include the following:

“9. Paragraph 2.3 of the F17 indicates that the NERR was delivered to employees between 1 and 4 May 2018. Coincidentally it appears that all the affected employees signed notices of appointment also between 1 and 4 May 2018.

10. It seems odd that every employee was in a position to make an informed decision about appointing themselves as a bargaining representative at exactly the same time that the employer issued the NERR.

11. It is reasonable to conclude that the applicant distributed the notice of appointment - the form is exactly the same in each circumstance. There is also reason to conclude that by distributing the notice of appointment with or at the same time as the NERR then the notice of appointment forms part of the NERR and constitutes non-prescribed content in contravention of s173.

12. Further, the content of the notice of appointment is misleading. On a plain reading of the notice, it appears that the notice is a formal notice issued in accordance with s176 of the Act. The CFMMEU has concerns that on employees being issued with the notice, the employees were led to feel obliged or required to complete the notice. This is reinforced by the last paragraph of the notice which reads:

“I certify that I have received notification of my rights and entitlements under section 174 of the Fair Work Act “(Cth) 2009 by virtue of having been issued with Schedule 2.1 under regulation 2.05 of the Fair Work Act regulations 2009 on ----- 2018.”)

13. The inclusion of this last paragraph in the notice makes it appear to the employees, that they are required to complete and tender the notice to the employer - so as to certify that they have been made aware of their rights.

14. There is no requirement in the Act for employees to sign a certification that they have been issued with the NERR - or issued with an explanation as to the operation of the Act.

15. The notice of appointment is clearly designed to require the employees to disclose information that is not actually required by the Act. There is no requirement under the Act for an employee to notify the employer that they are represented by an employee association. There is certainly no requirement for an employee to tell their employer that they are or are not a member of an employee association. Any employee being confronted with a requirement to complete a notice of appointment - and simultaneously being required to tell the employer whether or not they are a member of the union is a clear breach of the freedom of association provisions of the Act.

16. Notably the “option” for the employee to nominate their union as their bargaining representative is the third option in order of priority on the form. The first option is for the employees to nominate themselves as bargaining agents.”

[39] The union’s submissions crystallised to the proposition that what was provided to employees was not three separate documents, but instead a single document which included the NERR wording, as well as material dealing with appointment as a bargaining representative and matters of privacy. It invites a finding by the Commission that what was provided to employees was a “pack” of materials, not dissimilar to the matters that led the Full Bench in Peabody Moorevale Pty Ltd v CFMEU to find that a particular NERR was nonconforming, thereby not allowing approval of the agreement then before the Commission. The union reinforces its argument with reference to the matter of Methodist Ladies College in which the Commission declined to approve an agreement because it found that the employee representation nomination form distributed on that occasion was part of the NERR because there was no distinction between the NERR and the nomination form. 5

[40] In Peadbody Moorevale Pty Ltd v CFMEU 6the Full Bench dealt with a similar set of facts where:

“[3] Three documents were given to the relevant Peabody employees. They are set out as Annexures JP1, JP2 and JP3 to Mr Paterson’s statutory declaration of 23 January 2014. Mr Paterson is the HR Manager Operations for Peabody.These documents were stapled together. JP1 is intended to reflect the form and content of the prescribed Notice in Schedule 2.1 of the Regulations. JP2 is a ‘Nominee Form’ and JP3 is the ‘Employer Form’. A copy of JPI, JP2 and JP3 are attached to this decision.”

[41] While the Full Bench in Peabody Moorevale Pty Ltd v CFMEU found that the NERR cannot itself be altered in any way, 7 it nuanced this decision with respect to situations where accompanying documents are provided to employees at the same time as the NERR and their effect on s.176(1A) and 1(B). The Full Bench stated that:

“[67] First, s.174(1A) is not to be construed so as to preclude an employer from providing additional material to its employees at the same time as the Notice is given to them. Subsection 174(1A) is directed at the form and content of the Notice. It does not require the Notice to be provided in isolation and to construe the provision in that way would produce some absurd results, for example, it would prevent an employer from providing employees with a simple covering letter or an offer of interpreter services. Such a construction would also give rise to considerable uncertainty, for example, about whether an employer could merely provide the additional information in a separate envelope to the envelope containing the Notice, or whether the additional information could be provided at the same time or whether the employer would need to wait until a later time, and if so how long should the employer wait.

[68] These problems are avoided if s.174(1A) is interpreted as a means of curing the mischief to which it was directed, namely, ensuring that the actual Notice is not amended in content or form from the template provided in Schedule 2.1 of the Regulations. To the extent that Shape Shopfitters may be said to be inconsistent with our conclusion it is wrong and should not be followed.

[69] Secondly, where additional material accompanies a document which contains the content, and is in the form, prescribed in the Regulations, the issue to be determined is what purports to be the Notice. This is a question of fact.

[70] Thirdly, where additional material is provided with the Notice and that material has the character of being, for example, misleading or intimidatory, then this will be relevant to the Commission’s assessment of whether the enterprise agreement had been ‘genuinely agreed’ by the employees. However, it is not a basis for finding that a Notice has not been given in accordance with the Act. Section 188 deals with when employees have ‘genuinely agreed’ to an enterprise agreement. It is set out at paragraph [41] above. To rely on additional material which is misleading or intimidatory as a basis for finding that the Notice has not been given in accordance with the Act would be to conflate the issues that arise for consideration in paragraphs 188(a) and (c). These are two separate requirements and need to be considered as such. Paragraph 188(a) deals with whether a Notice was given in accordance with the Act (ie whether the timing, content and form requirements were met). Any concerns as to whether the employees may have misunderstood their right to be represented, despite being provided with a valid Notice, fall to be considered under paragraph 188(c). In Ostwald Bros Pty Ltd v CFMEU²³ the majority of the Full Bench made the following observation of section 188:

‘... it requires specific actions to have been undertaken (in ss.188(a) and (b) at specified times in advance of approval), with s.188(c) then requiring satisfaction that there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees. Section 188(c) of the Act, although itself a broad discretionary consideration, is an additional matter about which Fair Work Australia needs to be satisfied and relates to grounds other than those arising in relation to the ss.188(a) and (b) matters.’

[42] In Peabody Moorevale Pty Ltd v CFMEU the Full Bench found that the three documents together made up the NERR. In coming to this conclusion the Full Bench looked at factors such as the documents being stapled together and the responses provided by the employer in the Form F17 indicating an intention for the three documents to form part of the NERR. I find that these factors can be distinguished from the current circumstances.

[43] In this matter, while Mr Connolly declares that each of the documents “was placed on the table in a bundled form” 8 with employees taking from a pile, it is also that case that “[t]he forms were issued separately and each form spoken about”.9 Mr Connolly’s declaration was not the subject of a request for cross examination. As a result, the only evidence before me on the subject of the three documents and how they may have been constituted is from Mr Connolly in his statutory declaration. Mr Connolly’s declaration included a statement that the forms were issued separately and there is no contrary evidence before me that would lead to the view that instead the documents were “a pack” with there there being no distinction between the NERR and the Nomination Document. Given Mr Connolly’s declaration and the absence of contrary evidence on the subject, there is also insufficient material before the Commission that would allow a finding that either the NERR or the Nomination Document was invalidly prepared, distributed or signed.

[44] Moreover, the Form F17 filled out by Mr Connolly on 13 June 2018 provides the following response at Q2.3, which asks whether the employer took all reasonable steps to give notice to the employees to be covered by the agreement of their right to be represented by a bargaining representative;

“During the period of 1 to 4 May 2018, I delivered to each eligible employee, a ‘Schedule 2.1 – Notice of employee representational rights’.”

[45] There is no mention at Q2.3 of the Form F17 of the Privacy and Notice Documents. In fact there is no mention of these documents anywhere within the Form F17.

[46] Accordingly, the CFMMEU’s argument that the NERR was invalidly made because it was given to employees at the same time as the Nomination and Privacy Documents falls away.

[47] The CFMMEU also submitted that the form and content of the Nomination Document and its provision to employees at the same time as the NERR created a scenario whereby employees believed that they had to then and there make a choice about their bargaining representative which misled employees about their rights under s.176(1)(b)(i) of the Act.

[48] The CFMMEU raise numerous objections to the form and content of the Nomination Form as follows:

“10. It seems odd that every employee was in a position to make an informed decision about appointing themselves as a bargaining representative at exactly the same time that the employer issued the NERR.

11. It is reasonable to conclude that the applicant distributed the notice of appointment - the form is exactly the same in each circumstance. There is also reason to conclude that by distributing the notice of appointment with or at the same time as the NERR then the notice of appointment forms part of the NERR and constitutes non-prescribed content in contravention of s173.

12. Further, the content of the notice of appointment is misleading. On a plain reading of the notice, it appears that the notice is a formal notice issued in accordance with s176 of the Act. The CFMMEU has concerns that on employees being issued with the notice, the employees were led to feel obliged or required to complete the notice. This is reinforced by the last paragraph of the notice which reads:

“I certify that I have received notification of my rights and entitlements under section 174 of the Fair Work Act “(Cth) 2009 by virtue of having been issued with Schedule 2.1 under regulation 2.05 of the Fair Work Act regulations 2009 on ----- 2018.”)

13. The inclusion of this last paragraph in the notice makes it appear to the employees, that they are required to complete and tender the notice to the employer - so as to certify that they have been made aware of their rights.

14. There is no requirement in the Act for employees to sign a certification that they have been issued with the NERR - or issued with an explanation as to the operation of the Act.

15. The notice of appointment is clearly designed to require the employees to disclose information that is not actually required by the Act. There is no requirement under the Act for an employee to notify the employer that they are represented by an employee association. There is certainly no requirement for an employee to tell their employer that they are or are not a member of an employee association. Any employee being confronted with a requirement to complete a notice of appointment - and simultaneously being required to tell the employer whether or not they are a member of the union is a clear breach of the freedom of association provisions of the Act.

16. Notably the “option” for the employee to nominate their union as their bargaining representative is the third option in order of priority on the form. The first option is for the employees to nominate themselves as bargaining agents.

17. Essentially the form which the employees are required to complete requires the employees to tell the employer whether or not they are members of the CFMMEU.

18. Our union has a significant number of members at this workplace. Those members rights to be represented by the CFMMEU were undermined upon the distribution of an unlawful and misleading notice of appointment.”

[49] P J Connolly does not provide any direct submissions regarding the CFMMEU’s submissions on the form and content of the Nomination Document other than that provided in Mr Connolly’s statutory declaration which states that:

“Issuing of bargaining nomination forms to the employees

1. I issued the bargaining nomination forms along with the Schedule 2.1 and the privacy form. Each of these documents was placed on a table in a bundled form and issued to each employee.

2. As each employee took from the pile, I explained what each document was. This allowed for personal discussion with each individual as to what each document entailed.

3. I then allowed enough time for employees to read the documents for themselves and ask questions.

…

10. The employees were told that all information they provided would be private as per the privacy form, they were informed as to their rights of representation described in the Schedule 2.1 .

11. The employees were encouraged to read the documents provided to them, they were also issued with a bargaining nomination form that was discussed. It was made clear to them that they could nominate any of the following entities:

a. themselves,

b. another person within the company,

c. a legal representative,

d. the union or

e. any other person they deemed fit to represent them in the negotiation phase of this agreement.

Were the documents issued to all 47 employees?

12. Yes, each employee received all 3 documents and all were encouraged to read them, and return the nomination form and privacy notice when they had filled it out and to hold onto the notice of employee representational rights.” 10

[50] In KCL Industries the Full Bench referred to the following principles when assessing whether an agreement has been genuinely agreed:

“[29] In Central Queensland Services Pty Ltd 11, Asbury DP undertook a detailed analysis of decided cases relevant to the proper interpretation and application of s.188(c). The Deputy President referred to the above passage in Ostwald and then continued as follows:

“[65] The approach to considering whether employees have genuinely agreed has been discussed in a number of cases considering s. 188(c) and similar provisions in earlier versions of the legislation and can be summarised as follows:

• In deciding whether there are no other reasonable grounds for believing that an agreement has not been genuinely agreed to [by] employees who will be covered, the circumstances to be considered are those that existed when the agreement was voted on. 12 

• A consideration of all relevant circumstances revealed by the material before the Commission, at the time the Commissions considers the application for approval is required, in order to ascertain whether there are reasonable grounds for rejecting the genuineness of the agreement; 13 

• Circumstances including the provision of material or information to employees which has the character of being misleading or intimidating, 14 or where approval is affected by a material non-disclosure, or there is a scheme underpinning the agreement about which employees are not informed,15 will be relevant to the Commission’s assessment of whether the agreement has been genuinely agreed by the employees;

• Genuine agreement requires that the consent of employees was informed and that there was an absence of coercion. 16 

• Section 188(c) is only a basis for finding that an agreement is not genuinely agreed to if there are found to be reasonable grounds for this belief. This requires a consideration of the soundness of the agreement. 17 

• The requirement for genuine agreement considered in conjunction with the objects of the Act in relation to agreement making betokens a concern with the authenticity and moral authority of an agreement. 18 

[66] The facts in the cases where the genuineness of the agreement of employees has been brought into question are instructive. In Re Toys “R” Us (Australia) Pty Limited Enterprise Flexibility Agreement 1994  19it was found that the material supplied by the Company to employees did not fully disclose the impact of the agreement when compared to the existing award conditions. It was also found that the union with coverage of the employees was hampered in its efforts to disseminate an alternative view, at least over two crucial days when the ballot for approval of the Agreement was held. As a result it was found that the employees had not genuinely agreed to the agreement.

[67] The Manfield Colair Enterprise Agreement  20 involved circumstances where the employer resisted the approval of an agreement that had been voted on and approved by employees, on the ground that the final version of the agreement distributed to employees by the employer contained a significant mistake. Vice President Lawler found that there was no indication that the agreement was other than the product of a bona fide bargaining process. It was also held that a unilateral mistake made by the employer in the version of the agreement that was distributed, did not mean that the version of the Agreement voted on was not the true agreement and that there was no question of there being some other agreement, different to the one annexed to the application for approval that is the “true agreement”.21 On appeal,22 a Full Bench of the Commission upheld that decision and held that an employer who wishes to propose an agreement to its employees has an obligation to ensure that the agreement reflects its intentions.

[68] In Re MSS Security Pty Ltd Enterprise Agreement 2012  23 the matters that were held to constitute reasonable grounds for the Commission to believe that the agreement was not genuinely agreed to were that employees were incorrectly advised of the date upon which the approval ballot would close and as the percentage of employees who cast a vote was small, it was more probable than not that a significant number of employees did not vote because of incorrect information about the closing date of the ballot. The version of the Agreement that was voted on by the employees in that case was also missing pages.

[69] The Decision of the Federal Court in Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission and Others (Gordonstone)  24 dealt with the issue of whether an agreement was validly made in circumstances where the group of employees who made it were not yet employed and may never have been employed in the relevant single business. The Court concluded that the agreement had not been genuinely made. 

[70] In Grocon Pty Ltd Enterprise Agreement (Victoria)  25 it was held that the employer had created a structure or scheme involving employees being covered by a number of agreements in circumstances where the employees who voted to approve an agreement had been misinformed or had not been informed about the effect of the arrangements, and in particular the fact that they could be the only employees bound by the conditions in the agreement while other employees had different conditions. As a result, the vote of employees to approve the agreement was not genuine.

[71] It can be seen from the cases that the question of whether the Commission is satisfied that there are no other reasonable grounds for believing that an agreement has not been genuinely agreed to by employees is not limited to a consideration of whether there has been coercion or misinformation in relation to the agreement and its effect. The consideration under s.188(c) is not limited to these matters and incorporates all of the relevant circumstances surrounding the process by which employees indicate their agreement.”

[30] We agree with and adopt the majority analysis in Ostwald, and that of Asbury DP in Central Queensland Services.” (references from original)

[51] There is no evidence before me, direct or otherwise, that would lead to a conclusion that any of the employees to be bound by this Agreement have had their rights trammelled or misrepresented because of a process put in place by their employer, P J Connolly Pty Ltd. In Peabody the Full Bench noted:

“[20] As to the context, the Notice provides employees with important information about the nature of an enterprise agreement and the employees’ right to appoint a bargaining representative to assist them in bargaining for the agreement or in a matter before the Commission about bargaining for the agreement. The Notice sets out the default position for union members, that is, they will be represented by their union if they do not appoint a bargaining representative.”

[52] Given that there is neither evidence of a departure from the prescribed content in the NERR provided to employees nor any direct evidence that material provided to employees at the time the NERR was provided contained contrary content from that provided in the NERR, it is difficult to see how employees were misled by the materials provided to them. While the CFMMEU argues strongly that employees have felt intimidated by the process put in place by the Applicant, the test of that proposition is the correspondence initiated by the Commission to the employees concerned giving them the opportunity to express such views as they wished about approval of the Agreement to be taken into account by the Commission. No employee made contact with the Commission in response to its request.

[53] It is therefore reasonable to conclude that, notwithstanding their continuing membership of the CFMMEU, the employees concerned were not mislead as to their entitlements and they either did not want the union to act on their behalf in the negotiation of the Agreement, or they did not hold the concerns the union now puts forward, ostensibly on their behalf. There is no evidence that would lead to a finding that employees were confused as to their rights with respect to bargaining.

[54] In relation to the elements of s.188, I am satisfied that PJ Connolly Pty Ltd took all reasonable steps:

•  to ensure that Employees were given a copy of the written text of the agreement and any other material incorporated by reference in the agreement and that they had reasonable access to those materials throughout the access period for the agreement (s.180 (2));

•  to notify employees by the start of the access period of the time and place at which the vote would occur and the voting method to be used (s.180 (3));

•  to ensure that the terms of the agreement and the effect of those terms were explained to the relevant employees with that explanation been provided in appropriate manner taking into account the particular circumstances and needs of the employees(s.180 (5));

[55] I am also satisfied that employees were not requested to approve the Agreement until 21 clear days after the last Notice of Employee Representational Rights was given to them (s.181(2)) and that the Agreement was made on 1 June 2018 with a majority of employees casting a valid vote to approve the agreement (s.182(1)).

[56] It follows from the foregoing analysis and in the absence of cogent contrary evidence on the subject to the Commission that I am satisfied that the employees to be covered by the Agreement have genuinely agreed to the Agreement.

SHOULD THE AGREEMENT BE APPROVED?

[57] The foregoing analysis has dealt with the question of whether some of the preapproval procedures required by the Act have been conformed with and whether the Agreement has been genuinely agreed. It remains to be considered whether the Agreement conforms with the other requirements of the Act.

[58] In this regard, I note that the Employer has provided written undertakings for consideration by the Commission in PJ Connolly Pty Ltd’s application for approval of the Agreement.

[59] The undertakings deal with two concerns raised by the Commission with the Applicant relatively early in consideration of the enterprise agreement. Those concerns firstly relate to the need for the agreement to provide a nominal expiry date no more than four years after approval of the agreement in order to achieve consistency with s.186 (5) of the Act. Secondly the concerns went to an apprehension that the Agreement as drafted may lack consistency with the National Employment Standards which require there to be progressive accrual of annual leave throughout a year with no restrictions on the periods of leave to be taken.

[60] The Applicant responded to these concerns by providing the undertakings referred to in Annexure A of this decision. I am satisfied firstly that the concerns raised with the Applicant may be satisfied through the offering of an undertaking to the Commission and that the undertakings properly deal with the matters set out within s.190 of the Act and in particular that, if accepted by the Commission, they will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement.

[61] A copy of the proposed undertakings was provided by the Commission to the CFMMEU after the hearing in relation to this matter, with the union being given time to consider the proposed undertakings and provide their views. In finality the CFMMEU did not provide any material in relation to either of the proposed undertakings. I am therefore prepared to accept the undertakings provided by PJ Connolly Pty Ltd as a basis for approval of the Agreement.

[62] Subject to the undertakings referred to above, I am satisfied that each of the requirements of ss.186, 187, 188 and 190 as are relevant to this application for approval have been met.

[63] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 8 November 2018. The nominal expiry date of the Agreement is 31 October 2022.

COMMISSIONER

Annexure A

 1   Statutory Declaration of Phillip Connolly, dated 11 October 2018.

 2   P J Connolly Pty Ltd Outline of Submissions, Tab A, 27 September 2018.

 3   CFMMEU Submissions, dated 13 September, [20] – [24].

 4   Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited [2014] FWCFB 7940.

 5   Methodist Ladies’ College [2015] FWC 4050, [16].

 6   Peadbody Moorevale Pty Ltd v CFMEU [2014] FWCFB 2042.

 7 Ibid, [46]-[47].

 8   Statutory Declaration of Phillip Connolly, dated 11 October 2018, [1].

 9   Ibid, [9].

 10   Statutory Declaration of Phillip Connolly, dated 11 October 2018.

 11   [2015] FWC 1554.

 12   CJ Manfield Pty Ltd v CEPU PR522805 Per Watson VP, McCarthy DP and Jones C.

 13   Manfield Coalair and CEPU Electrical Division Northern Territory Enterprise Agreement Gove Alumina Refinery and Mine Site - 2010-2012 [2011] FWAA 9129 per Lawler VP at [22].

 14   Peabody Moorvale Pty Ltd v CFMEU [2014] FWAFB at [7] (Although this observation was made in the context of additional written material distributed at the same time as the Notice of Employee Representational Rights it is equally relevant in circumstances where oral presentations are made to employees); Re MSS Security Pty Ltd [2010] FWA 3687.

 15   Grocon Enterprise Agreement (Victoria) AIRC(2003) 127 IR 13 at 48; Manfield Coalair and CEPU Electrical Division Northern Territory Enterprise Agreement Gove Alumina Refinery and Mine Site - 2010-2012 [2011] FWAA 9129 per Lawler VP at [23].

 16   Re Toys R Us (Aust) Pty Ltd Enterprise Flexibility Agreement 1994 Print L9066; Grocon Pty Ltd Enterprise Agreement (Victoria) (2003) 127 IR 13 at 14.

 17   Ostwald Bros Pty Ltd v CFMEU [2012] FWAFB 9512 at [154] per Watson VP (dissenting).

 18   CFMEU v AIRC 93 FCR 317 at 357 per Wilcox and Madgwick JJ.

 19   Print L9066 (C No 23663 of 1994).

 20   [2011] FWAA 9129.

 21   Manfield Coalair and CEPU Electrical Division Northern Territory Enterprise Agreement Gove Alumina Refinery and Mine Site - 2010-2012 [2011] FWAA 9129 per Lawler VP at [25] and [36]

 22   CJ Manfield Pty Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia [2012] FWAFB 3534.

 23   [2010] FWA 3687.

 24 [1999] FCA 847, (1999) 93 FCR 317.

 25   Print PR927672, (2003) 127 IR 13.

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