Q.H.& M. Birt Pty Ltd

[2019] FWC 7975

[2019] FWC 7975

FAIR WORK COMMISSION

DECISION

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

Q.H.& M. Birt Pty Ltd
(AG2019/813)

DEPUTY PRESIDENT BOYCE SYDNEY, 22 NOVEMBER 2019

Application for approval of the Q H & M Birt Pty Ltd Enterprise Agreement 2019 — proposed enterprise agreement does not pass the better off overall test — proposed undertakings will result in substantial changes to the agreement – no genuine agreement – application dismissed

[1] An application has been made for approval of an enterprise agreement to be known as the Q H & M Birt Pty Ltd Enterprise Agreement 2019 (Agreement). The application is made pursuant to s.185 of the Fair Work Act 2009 (Act). It has been made by the employer, Q H & M Birt Pty Ltd (Applicant). The Agreement is a single enterprise agreement.

[2] On 26 June 2019, I granted permission, pursuant to s.590 of the Act, for the Australian Workers’ Union (AWU), to make submissions in respect of its assertions that the Agreement does not pass the “better off overall test” (BOOT).

[3] I later granted permission, pursuant to s.590 of the Act, for the Construction Maritime Mining Energy Union (CFMMEU), to make submissions opposing the approval of the Agreement.

[4] On 22 October 2019, I convened a hearing to hear argument as to the approval of the Agreement. At that hearing, Mr Richard Cunningham (Solicitor, Thomas Geer Lawyers) appeared (with permission) on behalf of the Applicant. Mr Alistair Sage (Senior Legal Officer) appeared for the AWU. Mr Ben Kruse (Legal/Industrial Officer) appeared for the CFMMEU.

[5] At the hearing, the Applicant accepted that a range of issues, which were identified by the Unions and the Commission, resulted in the Agreement not meeting the BOOT (in comparison to the terms and conditions set out in the Building and Construction Industry General On-site Award 2010) (Award)).

[6] Post the hearing, the Applicant provided draft undertakings that it is prepared to proffer to overcome identified BOOT deficiencies (undertakings). Those undertakings are set out at Annexure A to this decision.

[7] Section 190 provides that the Commission may approve an enterprise agreement with undertakings:

“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.”

[8] In the decision of Re Hyatt Ground Engineering Pty Ltd, 1 Commissioner Ryan said:

“The sense in which the word substantial appears in s.190(3)(b) is in my view to describe changes to the agreement as a result of undertakings offered where the changes are not ‘trivial or minimal’ or ‘ephemeral or nominal’.

In this sense, ‘substantial’ is not a quantitative term but a qualitative term. A number of trivial or minimal changes to the agreement may not constitute a substantial change to the agreement. However, even a single change to a provision of the agreement where the change was not trivial or minimal would constitute a substantial change to the agreement”. 2

[9] The undertakings proffered are required for the Agreement to pass the BOOT. However, the undertakings, in my view, will result in substantial changes to the Agreement. I therefore determinate that I am unable to accept the undertakings. Without such undertakings, the Agreement does not pass the BOOT, and the application for approval must be dismissed.

[10] In addition, I have formed the view that, in light of the evidence relied upon by the Applicant in these proceedings as to its compliance with s.180(5) of the Agreement, I am unable to approve the Agreement. In this regard, I am not satisfied that the Applicant:

a) undertook all reasonable steps, including during the access period, to explain the terms of the Agreement and the effect of those terms to employees, in a manner appropriate; or

b) explained relevant and material less beneficial terms (between the Agreement and the Award) to employees.

[11] The foregoing is apparent not only on the evidence but having regard to the extensive range of undertakings proffered to overcome BOOT deficiencies. I therefore determine that the Agreement has not been genuinely agreed by reference to the requirements of s.188 of the Act and must be dismissed on this basis.

[12] The application for approval of the Agreement is dismissed. An order to this effect will be issued in due course.

DEPUTY PRESIDENT

Appearances:

Mr Richard Cunningham (Solicitor, Thomas Geer Lawyers) appeared for the Applicant.

Mr Alistair Sage (Senior Legal Officer) appeared for the AWU.

Mr Ben Kruse (Legal/Industrial Officer) appeared for the CFMMEU.

Hearing details:

A hearing was conducted on 22 October 2019 in Sydney.

Printed by authority of the Commonwealth Government Printer

<PR714526>

Annexure A

 1   [2011] FWA 3527.

 2   Ibid at [30]-[31].