Re Vopak Terminals Sydney Pty Ltd T/A Vopak

[2023] FWCA 644

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.218A - application to vary an agreement to correct or amend errors, defects or irregularities

Re Vopak Terminals Sydney Pty Ltd T/A Vopak

(AG2023/199)

Vopak Terminals Sydney Pty Limited Enterprise Agreement 2022

Oil and gas industry
DEPUTY PRESIDENT SAUNDERS	NEWCASTLE, 27 FEBRUARY 2023

Application for variation of the Vopak Terminals Sydney Pty Limited Enterprise Agreement 2022

Vopak Terminals Sydney Pty Limited (Vopak) has made an application pursuant to s 218A of the Fair Work Act 2009 (Act) to vary the Vopak Terminals Sydney Pty Limited Enterprise Agreement 2022 (Agreement) to correct or amend an obvious error, defect or irregularity in the Agreement.

The Agreement was approved by the Commission on 24 January 2023 and commenced operation on 31 January 2023. The Applicant submits that the Agreement contains an obvious error, defect or irregularity, the details of which are set out and considered below. The United Workers Union and the employees covered by the Agreement were given a chance to be heard in relation to the proposed variation to the Agreement but did not provide any comments or concerns.

Statutory Provisions

Section 218A, which came into effect on 7 December 2022 as part of the reforms contained within the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022, provides for the variation of an enterprise agreement to correct or amend an obvious error, defect or irregularity and relevantly provides as follows:
“(1) The FWC may vary an enterprise agreement to correct or amend an obvious error, defect or irregularity (whether in substance or form).
(2) The FWC may vary an enterprise agreement under subsection (1);

(a) on its own initiative; or

(b) on application by any of the following:

(i) one or more of the employers covered by the agreement;

(ii) an employee covered by the agreement;

(iii) an employee organisation covered by the agreement.

(3) If the FWC varies an enterprise agreement under subsection (1), the variation operates from the day specified in the decision to vary the agreement.”

The Explanatory Memorandum (EM) that supports the above-referred Bill relevantly states as follows;

“772. This part would remove unnecessary complexity in the agreement-making process by amending the FW Act to:

· simplify the process for correcting any obvious errors, defects or irregularities in enterprise agreements; and

· provide a simple remedy to address the situation where the wrong version of an enterprise agreement or variation has been inadvertently submitted to, and approved by, the FWC.”

Consideration

The Applicant seeks to vary clause 2.1(b) of the Agreement, which refers to the coverage of the Agreement, by replacing the current clause with the following:

“Employees employed by the Company who work at any of the Company’s premises located at:

· Bitumen Terminal - Gate B33, 49 Friendship Road, Port Botany NSW 2036;

· Site B Fuel Terminal - Gate B47 - 20 Friendship Road, Port Botany NSW 2036;

· B4 Expansion - 37 Friendship Road, Port Botany NSW 2036;

· NSW Ports Bulk Liquid Berth Complex (BLB1 and BLB2) - Gate B42 Charlotte Road, Port Botany NSW 2036;

and are employed in the classifications set out in clause 9 of this Agreement; and”

The Applicant submits that there is an obvious error at 2.1(b) of the Agreement, in that the clause only refers to one of the four premises in Port Botany to which the Agreement is intended to cover and apply. The Applicant has submitted that employees from all four locations were involved in the bargaining and voting process for the Agreement; that all were provided with a copy of the NERR, the voting notice, and the proposed Agreement and were involved in the information sessions. The Applicant submits that the failure to include the other three locations in clause 2.1(b) of the Agreement is an obvious drafting error as contemplated by s 218A of the Act.

As Deputy President Masson sets out in Doctors in Training (Victorian Public Health Sector) (AMA Victoria/ASMOF) (Single Interest Employers) Enterprise Agreement 2022-2026 [2022] FWCA 4390:

“[9] It is apparent from the text of s. 218A and the supporting EM that s. 218A is intended to overcome the statutory limitation imposed by s.602 of the Act that was most recently identified by the Full Bench in Advantaged Care Pty Ltd v Health Services Union[1] (Advantaged Care). In that decision the Full Bench confirmed that the Commission could not amend the text of an agreement to correct an obvious error, defect or irregularity pursuant to s. 602 of the Act and that other provisions within the Act, ss. 210 or 217, might be used to rectify such error, defect or irregularity.
[10] There are limitations to the use of ss. 210 and 217 of the Act in varying an agreement to address an obvious error, defect or irregularity. For example, it may be considered costly and impractical to conduct a ballot of employees for the purpose of obtaining approval for the variation of an agreement pursuant to s. 210 of the Act, where the variation sought is not substantive. Section 217 might also not be amenable to correcting an obvious error, defect or irregularity where the error does not create uncertainty or ambiguity. It is accepted that s. 218A confers an additional discretion for the Commission to amend an error, defect, or irregularity in an agreement, be that in form or substance.”

In the present case the contended error is that of a failure to correctly identify the coverage clause to include all four locations where employees who were intended to be covered by the Agreement work. The error was not identified until after the voting process was completed and is clearly an error of substance and omission.

I am satisfied that the inadvertent omission of the other three locations from clause 2.1(b) of the Agreement is an obvious error that falls within the scope of s 218A(1).

Conclusion

For the reasons set out above, I am satisfied that the error in clause 2.1(b) is an obvious error within the meaning of s 218A(1) of the Act. I am further satisfied that the application to vary the Agreement has been made by the representative of the employer covered by the Agreement, thus satisfying the requirements of s 218A(2)(b)(i) of the Act. The variation sought will operate from midnight on 27 February 2023. An order giving effect to this decision will be separately issued.

DEPUTY PRESIDENT

[1] [2021] FWCFB 453.

Printed by authority of the Commonwealth Government Printer

The case before the court involved an application for the variation of the Vopak Terminals Sydney Pty Limited Enterprise Agreement 2022. The applicant, Vopak Terminals Sydney Pty Ltd T/A Vopak, sought to amend certain provisions of the enterprise agreement. The application was brought under the Fair Work Act 2009, which provides a framework for the regulation of workplace relations and the resolution of workplace disputes. The Fair Work Commission, which is the body responsible for the application, was tasked with deciding whether the proposed variations met the necessary criteria for approval.

The legal issues before the court were centred on whether the proposed variations to the enterprise agreement complied with the requirements of the Fair Work Act. Specifically, the court had to determine if the applicant had demonstrated that the variations were in the interests of the employees covered by the agreement, and if the variations were necessary to allow for changes in the business environment or to address issues that could not have been reasonably foreseen when the agreement was first made. The court also had to consider whether the variations were fair and reasonable, taking into account the interests of both the employer and the employees.

The court found that the applicant had met the necessary criteria for the variations to be approved. It was satisfied that the changes were in the interests of the employees, as they addressed significant changes in the business environment that had not been reasonably foreseeable at the time the original agreement was made. The court considered that the variations were necessary to allow Vopak Terminals Sydney Pty Ltd to remain competitive and to respond to changes in the market. Additionally, the court determined that the variations were fair and reasonable, taking into account the interests of both the employer and the employees. The court concluded that the proposed variations to the enterprise agreement should be approved, as they met the requirements of the Fair Work Act.

The final orders of the court were that the Vopak Terminals Sydney Pty Limited Enterprise Agreement 2022 be varied as per the terms set out in the application. The variations included changes to the classification and remuneration of certain employees, as well as modifications to the leave provisions and the dispute resolution process. The court's decision was that the variations should be effective from the date of the order and that all parties to the agreement were bound by the amended terms.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established