Re Site Fleet Services Pty Ltd

[2017] FWC 2163

[2017] FWC 2163

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Site Fleet Services Pty Ltd
(AG2017/206)

COMMISSIONER ROE MELBOURNE, 19 APRIL 2017

Application for approval of the Site Services Enterprise Agreement 2016. Notice of Representational Rights not issued within 14 days of notification time, Were Employees engaged within the scope of the Agreement, Whether there was genuine agreement. BOOT.

[1] On 25 January 2017 Site Fleet Services Pty Ltd (Site Fleet Services) applied for the approval of the Site Services Enterprise Agreement 2016 (the Agreement). There were two employee bargaining representatives. There are 11 employees who are said to be covered by the Agreement and all voted in favour of the Agreement on 23 January 2017. The Agreement incorporates in part ten Modern Awards. There is a schedule which lists the particular clauses of each Award which are incorporated. There is also a separate pay Schedule related to each Award and each Schedule contains tables of flat rates of pay applicable to each of 30 different roster patterns. There are separate tables for different classification levels and different rates for full time and casual employees. The F17 Statutory Declaration asserts that the Agreement does not contain any terms that are less beneficial than the equivalent terms of the 10 Awards and no less beneficial terms which are not found in the Awards.

[2] The Statutory Declaration asserts that the rates of pay, the casual conversion provisions (after three months subject to conditions), the notice period for casuals (four hours’ notice), the inclement weather provisions (TOIL for lost time), the allowances (the incorporated Award allowances not included in flat rate are 1% above award rates– not all the allowances are incorporated or included in the flat rate), the living away from home allowance and the trainee rates of pay are better than the relevant Awards.

[3] The CFMEU was not a bargaining representative for the Agreement and therefore did not have a right to participate in the proceedings. However, they raised a number of concerns about the Agreement and it was apparent from their correspondence that they had extensive knowledge about labour hire in a number of the areas covered by the proposed Agreement. Site Fleet Services is a related entity to a much larger labour hire company, Workpac. I considered it necessary and appropriate to investigate further their allegations concerning the lack of genuine agreement. I considered it appropriate that I should better inform myself by allowing the CFMEU to be heard in respect to the matter.

Notice of Representational Rights and notification time.

[4] Site Fleet Services applied for approval of an agreement voted up by employees on 29 September 2016. 1 An application was made for the approval of that earlier agreement on 29 September 2016 (AG2016/6102). The notification time for that agreement was listed in the F17 as 25 May 2016 and the last notice of representational rights was said to have been provided to employees on that same date. The F17 Form states that: “consistent with the Fair Work Regulations 2009 (2.04(2)), all eligible employees attended a meeting at which the Notice of Representational Rights was handed to all eligible employees personally.” The matter was allocated to me and I raised a large number of concerns about the Agreement on 25 November 2016. A response and proposed undertakings were received from the employer on 7 December 2016. I responded outlining remaining significant concerns on 12 December 2016. The Applicant discontinued the application on 14 December 2016. Mr Powell gave evidence that employees were notified of the withdrawal on 14 December 2016.

[5] The current application lists the notification time as 25 May 2016 and the last notice of representational rights was said to have been issued on that date according to the F17 Form. However, the Statement of Mr Powell of 15 March 2017 indicates that two employees who voted for the Agreement were engaged on 23 May 2016 and received the notice on 25 May 2016, a further eight employees were engaged around 1 August 2016 and received the notice around that time. One further employee was engaged in early December 2016 and received the notice at that time. This evidence demonstrates that the statements provided in the earlier F17 and in the F17 for the current application were incorrect in their advice that the last notice of representational rights was issued to employees on 25 May 2016.

[6] In respect to the earlier agreement the F17 stated that 20 employees would be covered by that agreement compared to the 11 covered by the present Agreement. 18 employees voted for the earlier agreement, six of whom were engaged in May and the balance in August. Of the 20 employees who would be covered by the earlier agreement only 10 participated in the process for the Agreement.

[7] Mr Powell gave evidence that there were a number of meetings prior to the making of the first agreement in September 2016. The next meeting was held with the bargaining representatives on 22 December 2016 to discuss the issues I had raised with the first agreement. A revised agreement was provided to most of the employees at a meeting on 11 January 2017. The final document was circulated on 13 January 2017 and the vote taken on 23 January 2017.

[8] The CFMEU submitted that I cannot be satisfied that the Agreement was genuinely agreed to as Site Fleet Services failed to comply with Section 181(2) of the Fair Work Act 2009. They submit that the earlier agreement was made on 29 September 2016. An agreement is made regardless of whether or not it is subsequently approved by the Fair Work Commission including in circumstances where the application is discontinued. In the Full Bench appeal against my decision in Uniline Australia Limited 2 DP Gostencnik and Commissioner Riordan determined as follows:

“[112] First it is said that the interpretation of the Act adopted by the Commissioner would impose impractical, unworkable and very costly outcomes on employers and employees, because:

• In many circumstances an employer would be unable to issue a new Notice during bargaining if a minor error was discovered in the wording of the earlier Notice issued at the commencement of bargaining;



• An employer would be unable to issue a new Notice during bargaining to a new group of employees if the scope of the proposed enterprise agreement was expanded and this new group of employees was proposed to be covered, as to do so would lead to a breach of s.173(3) and an inability to have the agreement approved; and



• An employer would be unable to overcome an oversight to issue a Notice within 14 days of the “notification time”, because in most circumstances an employer has no capacity to establish a new “notification time”. Under the Act, once bargaining has commenced an employer has good faith bargaining obligations and it does not have the right to unilaterally stop bargaining and to then initiate or agree to bargain (see s.173(2)(a) of the Act).

[113] In our view there is no substance in these submissions. Artificial though it may be, an employer that discovers it had issued an invalid Notice, would cease bargaining with its employees and would agree to bargain or initiate bargaining afresh thus triggering a notification time and a new period within which a valid Notice may be issued. There is nothing in the Act which compels a conclusion to the contrary, except perhaps in circumstances where a majority support determination has been made. Where an employer initially agreed to bargain for an agreement with a particular scope and later agreed to bargain for an agreement with a broader scope, that agreement to bargain in our view, triggers a notification time and a requirement thereafter to issue a Notice to relevant employees who are to be covered by the broader scope agreement. We do not need, for present purposes to decide whether, having regard to s.173(4) such a Notice needs to give to employees who received a Notice for the proposed agreement with a more limited scope.

[114] The Appellant also submitted that if an enterprise agreement was not approved by the Commission on the basis of failure to strictly comply with s.173(3), the parties would be at risk of having any subsequent proposed agreement rejected because the employer would have typically initiated or agreed to bargain months before and the timeframe in s.173(3) would be calculated from that earlier time.

[115] There is no substance to this submission. Once an application is made to the Commission, bargaining for the agreement has concluded albeit that the agreement might not be approved for a variety of reasons, including for example, that it does not pass the better off overall test. In that event, the employer could if it wished, initiate bargaining for a proposed agreement, the effect of which will be to trigger a notification time following which a valid Notice must be given.”

[9] The scope of the earlier agreement in this case was broader than the scope of the Agreement. The Notice of Representational Rights issued for the earlier agreement relates to “employees who are principally engaged in contracted scopes of works in all industries in all States and Territories of Australia for which classifications and rates of pay are prescribed by this Agreement.” In other words an employee who received the notice would not have any idea of its proposed scope until they received a copy of the proposed agreement. This did not occur in respect to the current Agreement until January 2017.

[10] I am bound to follow the decision in Uniline. The bargaining for the earlier agreement has therefore concluded on 29 September 2016 and it follows that Site Fleet Services cannot rely on the earlier notification time. The notification time for this Agreement must be after the date that the earlier application was withdrawn and employees were advised of the decision to withdraw on 14 December 2016. The employer does not suggest that it took any steps to reopen or recommence negotiations between 29 September 2016 and the time of withdrawing the earlier application.

[11] No new notice was issued. Section 188 and Section 186 prescribe that I cannot approve an agreement unless there has been genuine agreement. There cannot be genuine agreement unless the last notice under Section 173(1) was issued at least 21 days prior to the vote. To be a valid notice the employer must give the notice as soon as practicable, and not later than 14 days after the notification time for the agreement. 3 As no notice was issued after the notification time for the agreement the requirement has not been met. The only permitted exception is set out in Section 173(4) which provides that the notice is not required “if the employer has already given the employee a notice under that subsection within a reasonable period before the notification time for the agreement.”

[12] I accept that the employee who started work in early December 2016 and received the notice at that time received the notice within a reasonable period before the notification time. However, the employees who received the notice in May 2016 could not be said to have received the notice within a reasonable period.

[13] There is some continuity between the process for reaching the earlier agreement and the process for reaching the Agreement. Similarities can be found in the basic structure of the two documents. Both documents contain wages and conditions which are very close to the award entitlements but in some cases disadvantage employees when compared to the relevant awards and in other cases slightly advantage employees when compared to the relevant awards. There are however significant differences between the two documents and there was a significant gap between the vote on the earlier agreement in September 2016 and the meeting concerning the new Agreement on 11 January 2017.

[14] The notice was not understandable until the scope of the proposed agreement was known because the notice defined the scope by reference to the proposed agreement. The scope changed during the period after the first proposed agreement was finalised. There is no necessary requirement to issue a new notice just because the scope changes. However, a change in scope is a significant matter and the information in the notice needs to be read and understood in conjunction with it.

[15] A purpose of Section 173 and Section 181 is to ensure that the notification time and the issuing of the notice are reasonably proximate; that is, the issuing of the notice and the commencement of bargaining are not too far apart. Another purpose is to ensure a minimum 21 day period for possible bargaining after the scope of the proposed agreement and the representational rights are known.

[16] Only half of the employees who participated in the earlier agreement making process were still employed and able to participate in the process for the Agreement. The bargaining representatives all appear to have been appointed prior to the making of the first agreement – the applications for the earlier agreement and for the Agreement both advise that there were 14 instruments nominating two bargaining representatives.

[17] In all the circumstances I do not consider that a period of more than six months prior to the notification time to be a reasonable period for the issuing of the notice. The Agreement cannot therefore be approved.

[18] Although it is not strictly necessary I will deal with some of the other issues.

No genuine agreement – the employees were not covered by the Agreement.

[19] Clause 4 of the Agreement provides that the application of the Agreement “shall cover employees that are principally engaged in contracted scopes of works in all industries in all states and Territories of Australia for which classifications and rates of pay are prescribed by this Agreement.” The classifications and rates of pay are prescribed by reference to particular terms of the ten awards. Clause 5 “Scope and Intent of Agreement” provides that the Agreement “shall cover all contracted services/works of the Company within all States and Territories of Australia.” Clause 6 “Definitions” provides that contracted services/works “means the delivery, preparation and/or tasks associated with any contracted works or tenders for any Client in all states and territories of Australia”.

[20] Site Fleet Services argues that the preparation of bids or tenders for work which has not been won by the company falls within the definition of contracted services/works because the definition refers to preparation associated with any contracted workers or tenders for any Client. However, I am not satisfied that this is the ordinary meaning of the words. I am satisfied that the words “for any Client” restricts the term contracted services/works to work associated with actual clients of Site Fleet Services. I am not satisfied that contracted services/works include proposed or possible services or works. Once there is an actual Client or contract with a client then works in preparation may fall within the scope. I consider that in context the use of the word “tenders” is a reference to a tender which has been obtained or to a tender which is being prepared for a Client. It is not when considered in context a reference to an offer made in order to hopefully secure new work.

[21] The 11 employees who have been engaged are electricians, boilermakers, labourers, auto electricians or trainees. None of the 11 employees performed any work with any of Site Fleet’s clients in their relevant field. None of those engaged are managers, surveyors, professional engineers, accountants, or clerks: or employees of the sort who would normally be engaged to prepare tenders or bids to secure new work. The evidence of Mr Powell is that in the period since May 2016 Site Fleet has not secured a single contract with any clients under which the employees could perform work. Mr Powell gave evidence that the employees have been engaged for a small number of hours each week, effectively on standby and paid four hours a day, and to the extent that they have performed work they have been paid to attend the bargaining meetings for the previous agreement which was withdrawn and one meeting for the Agreement and also to assist the company with tenders. Mr Powell gave evidence that the intention is for the employees to perform work in Newcastle and the Hunter Valley if the company is successful in getting contracts with clients. However, the workers are currently based in Brisbane and have remained based in Brisbane throughout the period of their engagement.

[22] Mr Powell said that “they were helping us with tenders in relation to commercial interests of Site Fleet Services that we were pursuing in accordance with what the aims were for this enterprise agreement.” 4 Employee number 3 has been employed since May 2016. He is employed as an electrician under the Electrical, Electronic and Communications Contracting Award 2010. He is paid the Award rate for special class electrician, Electrical Worker Grade 7. Mr Powell said that “in relation to his assistance, it was on his expertise as a previous electrical supervisor in relation to some electrical contracting work that we were wanting to pursue through that entity.”5 However, employee number 3 was not paid as an electrical supervisor or as an engineer. Similarly Mr Powell gave evidence concerning another electrician, employee number 6, that “he was assisting us with the tendering commercial work and was on call for electrical work.” However, he did not actually perform any electrical work.6

[23] The scope of the Agreement is illustrated by the coverage in the Black Coal Mining Award area. The application of the Agreement in that industry is set out at Clause 1 of Schedule F of the Agreement: “The Schedule applies to employees who are engaged in the black coal industry whose duties are directly connected to the day to day operation of a black coal mine and classifications as set out in Schedule A of the Black Coal Mining Industry Award 2010.” The only employee engaged by Site Fleet in this area is a trainee. He has never worked in the industry and is not qualified to do so. His previous experience is as a scaffolder. It is a mystery as to how such an employee would have the qualifications or expertise to assist in the preparation of a tender or bid for work in the industry and an even greater mystery as to how the employee could be said to be engaged within the scope of the classifications in the Black Coal Mining Industry Award 2010 when engaged in such work. Given that Site Fleet does not have any contract to work in the black coal mining industry which includes a requirement for black coal mining work within the scope of the classifications in the Black Coal Mining Industry Award 2010, I cannot see how the trainee has duties which are directly connected to the day to day operation of a black coal mine.

[24] I am satisfied that the trainee, employee number 21, is not engaged within the scope of the Agreement.

[25] I am also satisfied that the 11 employees are not performing “contracted services/works” as defined in the Agreement and therefore are not engaged in work which is covered by the Agreement.

[26] The employees who voted on the agreement may be covered by it at some future time, should Site Fleet eventually get some clients within the scope of the Agreement. However, the employees were not covered by the Agreement when it was voted on. As there were no employees actually covered by the Agreement when it was made pursuant to Section 186(2)(a) I cannot be satisfied that the agreement has been genuinely agreed to and the application for approval must be dismissed.

Were all reasonable steps taken to explain the Agreement (Section 188(a)).

[27] The employer must take all reasonable steps to ensure that the terms of the Agreement and the effect of those terms are explained to the relevant employees. Mr Powell gave evidence that no provision of the Agreement was less beneficial than any of the reference awards. This was also attested to in the F17. I am satisfied that Mr Powell in explaining the Agreement to the employees did not draw their attention to any provision which was less beneficial than the reference awards. I am satisfied that there are a number of provisions which are less beneficial than the Awards and these matters were not drawn to the attention of employees.

[28] Critical to the structure of the Agreement is the relationship between specific provisions of the Agreement and the relevant Awards. The relationship is complex because:

● Some Award provisions are incorporated by reference to the clause numbers in the relevant Award.
● Some Award provisions are modified by a provision that the Agreement applies to the extent of inconsistency.
● Some Award provisions are not incorporated because the clause number is not referred to in the Agreement.

[29] I am satisfied that because there are separate schedules for each of the ten awards partially incorporated it is difficult for employees to understand the effect of the Agreement. Furthermore, as discussed earlier the rates of pay and conditions are not significantly better than the relevant Awards. In these circumstances understanding the benefits and disbenefits accurately is critical to appreciating the effect of the Agreement. In circumstances where wages and conditions are in the main significantly better than the relevant Award it is not so important to understand in detail every disbenefit. In circumstances where only one or two Awards are the reference instruments the explanatory task is much less complex. What are “all reasonable steps” depends upon the circumstances. The Act itself contains a specific requirement about the explanation: “in appropriate manner taking into account the particular circumstances and needs of the relevant employees.” 7 I do not consider that this particular requirement is an issue in the circumstances of this case. There is no evidence of employees from diverse linguistic or cultural background, young employees or employees who did not have a bargaining representative. However, this is not an exhaustive requirement. The nature of the Agreement will also influence what is necessary to ensure that all reasonable steps are taken to explain the effect of the agreement and its terms. In this particular case I am satisfied that all reasonable steps needed to include an accurate identification and explanation of the benefits and disbenefits in the Agreement when compared to each of the ten Awards. I am not satisfied that any of the disbenefits were identified and explained.

[30] I will now outline what I consider to be the matters in the Agreement which are disbenefits and which were not identified or explained to employees:

a) In some cases the flat rates provided for in the Agreement are not sufficient to ensure that employees are better off financially than they would be for working the same hours under the Award. For example the flat rates for those who would be covered by the Concrete Products Award 2010 are not high enough to compensate Level 1 to 5 employees working 10 or 12 hour shifts Monday to Friday or Monday to Saturday or Monday to Sunday. This also applies to continuous shift workers due to lower rates than the Award for Saturdays. Permanent night shift casuals working 10 hours per day Monday to Friday will also not be better off. There are similar issues with respect to each of the other Awards except the Waste Management Award 2010. The particular problematic working patterns vary to some extent, however, in respect to each of the Awards the problematic patterns are neither marginal nor fanciful. In the Black Coal Mining industry the rates of pay for trainees fall below the modern award rates because of the 35 hour week in that award. The rates of pay for trainees in the Agreement are generally below the rates in the Awards for Certificate IV trainees.

b) The Agreement provides for TOIL rather than payment for lost time in inclement weather. This is a disadvantage when compared to some of the Awards.

c) The Agreement provides for casual employment in the black coal industry which is not provided for in the Award. I am not satisfied that simply providing the 25% loading is sufficient to compensate for this disadvantage. Of course there is nothing to stop an Agreement meeting the BOOT which includes casual employment in this industry but I consider that the rates or the other benefits would need to be greater than the 25% compensation which is regarded as sufficient in Awards that provide for casual employment.

d) The definition of shiftworker for the purpose of the NES additional week of annual leave disadvantages employees when compared to the Award provisions in some of the referenced Awards.

e) The incorporation process means that some award allowances are incorporated in the flat rate, some apply and some do not apply. Given the rates are generally very close to the Award rates, in many cases 0.20% above, the exclusion of these allowances may mean that the higher rates are insufficient to ensure that the BOOT is met. For example in respect to Building and Construction the follow the job loading, leading hand allowance, mobile crane allowance and attending for work but not required payments are included in Clause 19 of the Award which is not incorporated into the Agreement.

f) The notice of termination required by employees in the Agreement exceeds that required by the Black Coal Mining Industry Award 2010.

g) Higher duties provisions are less beneficial in the Agreement than those in the Asphalt Industry Award 2010.

h) Some Awards provide for dispute resolution training leave but the Agreement in most cases excludes this provision.

i) The Agreement allows for part time employees to work an average of less than the ordinary full time hours per week. Clause 6 of the Agreement defines part time and full time employees by reference to 38 hours per week whilst other provisions in the Agreement suggest that the ordinary hours are defined by the particular Award. The Black Coal Mining Industry Award 2010 does not allow a part time worker to work more than 35 ordinary hours. The Agreement does not provide for regular hours for part time workers. The flat rates of pay in respect to all of the Award areas will not be high enough to compensate for part time workers who work additional hours beyond their agreed ordinary hours.

j) Some Awards including the Manufacturing and Associated Industries and Occupations Award 2010 provide for career progression and for classification based upon relevant qualifications even if not all aspects of the qualification are utilised in employment on every occasion. The Agreement provides that classification is determined by the employer for each assignment based on the skills required and used for the particular role not skills attained (Clause 15).

k) No allowance has been made in the pay rates in Schedule G of the Agreement for the additional hourly rate mandated by Clause 19.3 of the Building and Construction General On-site Award 2010 for daily hire employees. I am satisfied that the Agreement does not exclude employment of full time employees on a daily hire basis as occurs under the Award and that the failure to include the allowance means that daily hire employees will be worse off than they would be under the Building and Construction General On-site Award 2010.

l) The Agreement contains an abandonment of employment clause which is not found in most of the Awards. This is a disadvantage when compared to the Awards as it creates enforceable obligations on employees and rights for the employer. However, the clause does include protections which mean that it is not an unlawful term which offends Section 194(d). The Agreement also contains a probation clause which is not found in the Awards. This is a disadvantage when compared to the Awards but as it is subject to the NES it is not a significant disadvantage. Clause 12 of the Agreement excludes an employee who has abandoned their employment from rights to notice under the NES and also Clause 12 does not require termination notice to be in writing as required by the NES.

[31] In respect to the “more beneficial” conditions identified by the employer in the F17:

● In most cases the base rates of pay are marginally above the relevant Awards. However, in some cases the flat rates of pay are not above the award rates.
● In some cases the minimum notice period for casuals will be better than the award provision but in those awards which have a four hour minimum engagement period there will be no significant advantage.
● The inclement weather provisions will be an advantage in those Award areas which do not have inclement weather provisions. However, where the Awards have such provisions the TOIL requirement rather than payment may be a disadvantage. There may be some other more beneficial aspects of the Agreement clause.
● The 1% addition on some allowances is an advantage. However, not all allowances are applicable or incorporated.
● Trainee rates of pay are better than that provided for in some relevant Awards but not in all cases.
● Living Away from home allowance is better than the provision in some Awards but there are some Award circumstances where this will be a neutral consideration.

[32] The Agreement contains a reconciliation clause which does not ensure that employees are better off overall because it is activated by an employee request. The Agreement provides that the company will perform yearly reviews consistent with the pay increases in this Agreement to ensure that current relativities with the modern awards are maintained. Given that these relativities are in some cases below the relevant awards this does not ensure that the BOOT is met.

[33] Mr Powell gave evidence that the effect of Clause 4(d) of the Agreement was that where the Agreement was silent about a matter the relevant Award provision was incorporated. I am satisfied that this is not correct. The provisions in Clause 4(a) and 4(b) mean that only the provisions specified in Schedule A are incorporated and that if there is inconsistency between an incorporated Award term and an Agreement term then the Agreement term shall prevail. I am satisfied that it is reasonable to infer that Mr Powell gave employees this erroneous information about the incorporation of Award terms into the Agreement.

[34] Site Fleet Services submitted that the clauses which are not incorporated and the issues of detriment raised are not significant. I agree that some of the matters are minor and that the concerns may well be able to be resolved through an undertaking. However, I consider that some of the matters are significant and taken as a whole the employees could not have understood the effect of the Agreement without being informed of the significant number of detrimental terms.

[35] Taking all these matters together I am not satisfied that the employer took all reasonable steps to ensure that the terms of the Agreement and the effect of those terms are explained to the relevant employees. As the requirement in Section 180(5) has not been met I cannot be satisfied that that the requirement for genuine agreement in Section 188(a)(i) has been met and I cannot approve the Agreement because of Section 186(2).

Are there Reasonable grounds for believing the Agreement was not genuinely agreed (Section 188(c))

[36] This goes to the authenticity of the Agreement. The CFMEU raised a number of issues in respect to this matter. They submit that the evidence of Mr Powell cannot be believed and that the Agreement is a sham or a contrivance.

[37] It is not the role of the Commission to judge the quality of an agreement. However, it may raise some questions about the authenticity of the Agreement that there are no terms in the Agreement that obviously contribute to productivity and despite a number of meetings between employees and Site Fleet Services overall employees are not better off than the relevant Awards or at best are marginally better off. This is an unusual outcome in industry areas where over award payments and conditions are the norm. Of course such questions or suspicions are no basis upon which to reach a conclusion that the Agreement lacks authenticity.

[38] I found Mr Powell’s evidence concerning the work performed by the employees and the reasons for their continued engagement lacked specificity and I did not find it credible. His original Statement of 15 March 2017 gave the impression that the employees had significant workloads including in the relevant industries.

[39] I accept Mr Powell’s evidence to the effect that having an Agreement which prevents employees from exercising a right to further bargaining and to take protected industrial action during its term would assist the company in securing potential work. The Act does not make such a motivation for reaching an Agreement illegitimate provided that there is genuine agreement.

[40] The two employees who were engaged under the Black Coal Mining Industry Award 2010 ended their employment with Site Fleet on 2 December 2016 and the trainee commenced employment on 5 December 2016. Site Fleet say that there were legitimate business interests to employ the trainee. However, I am not satisfied that the trainee had any particular Black Coal Mining Industry expertise which would have assisted the company with bidding for work in the industry. It is reasonable to infer that a reason, not necessarily the sole reason, for the engagement was to enable an Agreement with a scope that included Black Coal Mining to be reached.

[41] Site Feet Services did not employ any employees at the time it decided to make an enterprise agreement. 8 I am satisfied after considering the totality of Mr Powell’s evidence that employees were first engaged on 23 May 2017 for the purpose of procuring an enterprise agreement. Mr Powell said that:

“..They were employed at the appropriate time when we wanted to start employing people, like I said, to assist us with those commercial pursuits.

And to assist you making an enterprise agreement as well? ---Well that’s part and parcel of it, yes and I thought that’s the right of the employer to pursue that.” 9

[42] The employees did not apply for jobs with Site Fleet. They were selected by Site Fleet from the WorkPac databases. 10 They have done no work for any client of Site Fleet services. The employees are engaged and paid under some of the Awards which are within the scope of the Agreement. However, there are no employees engaged under the following Awards which are incorporated in the Agreement: Waste Management Award 2010, Concrete Products Award 2010, and Asphalt Industry Award 2010. The employees who voted for the Agreement could never have received the benefits of the provisions of these Awards as their work would not have been covered by them. It is reasonable to conclude from the evidence that the employees had no knowledge of or experience with these Awards and their industries.

[43] I accept that an agreement can have authenticity notwithstanding the fact that no one had yet been engaged in a classification or an Award area that is within the scope of the Agreement. It is a question of the particular circumstances and the relative magnitude of the problem. In the circumstances of this case understanding the Awards is critical to understanding the Agreement and its impact. In the circumstances of this case it is not possible to predict where the predominance of any contracts obtained by Site Fleet Services will fall. It is certainly not possible to conclude that the areas covered by these three awards will be marginal or peripheral to the business.

[44] The trainee who is engaged under the Black Coal Mining Industry Award 2010 has no experience in that industry and I am not satisfied that they had knowledge or experience with the Award or the industry. The black coal mining industry and its award have a significant number of features which are particular to that industry and award.

[45] Site Fleet Services argue that this case is distinguishable from that in the Full Bench decision in KCL Industries Pty Ltd. 11 I accept that there are differences in circumstance. Some of the factors present in the KCL case are not present in this case. However, I consider that the factors discussed earlier are a strong and sufficient basis to conclude that the process for making the Agreement lacked authenticity or moral authority.

[46] I am satisfied that there are reasonable grounds for believing that the Agreement was not genuinely agreed to by the relevant employees. I cannot approve the Agreement for this reason.

Conclusion

[47] The application for approval of the Agreement is dismissed.

COMMISSIONER

Appearances:

C Giannati appeared for the Applicant.

P Boncardo, M Aird and A Thomas appeared for the CFMEU.

Hearing details:

2017

Melbourne with video to Sydney:

March 23 and April 6

 1   Statement of Mr Powell of 15 March 2017 at para 29.

 2   [2016] FWCFB 4969.

 3   See Fair Work Act 2009 (Cth)s 173(3).

 4   Transcript PN92.

 5   Transcript PN95.

 6   Transcript PN98 to PN102.

 7   See Fair Work Act 2009 (Cth)s 180(5).

 8   Transcript PN190 to PN191.

 9   Transcript PN192 to PN193.

 10   Transcript PN188 to PN189.

 11   [2016] FWCFB 3048.

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