DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Perth Access Scaffolding Pty Ltd
(AG2016/5740)

COMMISSIONER ROE

MELBOURNE, 8 NOVEMBER 2016

Application for approval of the PAS Enterprise Agreement 2016. Section 188 genuine agreement. Undertakings required to meet the BOOT would result in substantial changes to the Agreement. Agreement not approved.

[1] An application has been made for approval of an enterprise agreement known as the PAS 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 Perth Access Scaffolding Pty Ltd (PAS). The Agreement is a single enterprise agreement.

[2] The Construction, Forestry, Mining and Energy Union (CFMEU) objected to the approval of the Agreement on a number of grounds. The CFMEU was not a bargaining representative for the Agreement. The CFMEU has not established a right to intervene in the process of approval of the agreement. However, I decided that I would be assisted in reaching a conclusion about the issues of genuine agreement and the Better off Overall Test (BOOT) if I had submissions from the CFMEU because the CFMEU has a significant level of membership in the industry and it is therefore likely that employees who may be engaged in the future under the agreement will be members of the CFMEU. The CFMEU also has expertise in the nature of the industry and the Building and Construction General On-Site Award 2010 (Award) provisions. This is particularly the case given only five employees are currently covered by the Agreement, who are employed in Western Australia, while the Agreement includes an extensive range of classifications and is to operate throughout Australia.

[3] The rates of pay under the Agreement are between 2% and 3.5% above the rates applicable under the Award, however, there are a number of matters which are detrimental to employees when compared to the Award. These include:

Absence of casual loading on overtime and other penalty payments.

Redundancy entitlements in accordance with the NES rather than the industry specific scheme. The industry specific scheme applies in a much wider range of circumstances than the NES.

Ordinary hours of work can be averaged over an undefined work cycle whilst the Award limits this to four weeks.

A number of allowances which are applicable under the Award are not included in the Agreement. It is possible that some of the conditions under which these allowances are applicable are not generally encountered by employees of the company. However, the Agreement is not restricted in the scope of its operations and employees may be required to work under such conditions.

No compensation for tools and clothes and their protection.

A mechanism for the adjustment of expenses allowances is not included in the Agreement but is included in the Award.

Some of the allowances which are included in the Agreement are inferior to the Award: (E.g. restrictions on when fares and travel allowances apply, meal allowance payable after two hours rather…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Perth Access Scaffolding Pty Ltd [2016] FWC 8042
Case: [2016] FWC 8042
Decision Date: 8 NOVEMBER 2016

CaseChat Overview and Summary

Perth Access Scaffolding Pty Ltd is involved in a dispute concerning the approval of the PAS Enterprise Agreement 2016 under the Fair Work Act 2009. The case was heard in the Fair Work Commission, which has the authority to approve or reject enterprise agreements based on certain criteria, including whether the agreement was made in good faith and whether it meets the Better Off Overall Test (BOOT). The application for approval was contested on the basis that the agreement did not meet the BOOT and that the undertakings required to meet this test would result in substantial changes to the agreement.

The primary legal issues before the Commission were whether the agreement was genuinely an enterprise agreement and whether it satisfied the BOOT. The applicant argued that the agreement was genuinely negotiated and met the BOOT, while the respondent contended that the agreement did not meet the BOOT and that the proposed undertakings would alter the agreement's nature. The Commission had to determine whether the agreement was made in good faith and whether it provided employees with a better overall outcome than the applicable award or safety net award.

In reaching its decision, the Commission examined the process by which the agreement was negotiated and the content of the agreement itself. It found that while the agreement appeared to have been negotiated in good faith, it did not meet the BOOT. The proposed undertakings to meet the BOOT would have resulted in substantial changes to the agreement, which would have altered the agreement's character and the process by which it was negotiated. The Commission concluded that the agreement could not be approved as it stood and that the required undertakings would fundamentally change the agreement, thereby compromising its genuine nature.

The Fair Work Commission declined to approve the PAS Enterprise Agreement 2016, stating that the agreement did not satisfy the BOOT and that the necessary undertakings to meet this test would result in substantial changes to the agreement. The Commission emphasised the importance of genuine negotiation and the Better Off Overall Test in the approval process for enterprise agreements. As a result, the agreement was not approved, and the matter was remitted back to the parties for further negotiation and consideration.

Orders