RSL Care RDNS Limited T/A Bolton Clarke
[2024] FWC 2870
•16 OCTOBER 2024
| [2024] FWC 2870 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.185—Enterprise agreement
RSL Care RDNS Limited T/A Bolton Clarke
(AG2024/1719)
| COMMISSIONER HUNT | BRISBANE, 16 OCTOBER 2024 |
Application for approval of the Bolton Clarke Queensland Enterprise Agreement 2024
On 21 May 2024, RSL Care RDNS Limited T/A Bolton Clarke (the Employer) applied for approval of an enterprise agreement known as the Bolton Clarke Queensland Enterprise Agreement 2024 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single-enterprise agreement. The Employer is a not-for-profit aged care provider. It operates a number of retirement and aged care facilities throughout Australia and also provides home care services.
The employees proposed to be covered by the Agreement are presently covered by four enterprise agreements which have each passed their nominal expiry date:
· RSL Care Agreement 2015;
· Allity Enterprise Agreement (Queensland) 2019;
· McKenzie Aged Care Group Enterprise Agreement 2016; and
· McKenzie Aged Care (Glasshouse Views, Seabrook, Bribie Cove) Enterprise Agreement 2016.
The Agreement is to cover employees covered by any of the following three modern awards:
· Aged Care Award 2010 (Aged Care Award);
· Social, Community, Home Care and Disability Services Industry Award 2010 (SCHADS Award); and
· Nurses Award 2020 (Nurses Award).
The Fair Work Commission (the Commission) raised certain concerns regarding the Agreement with the Employer, particularly in respect to the treatment of long service leave and the better off overall test (BOOT). The Employer provided written undertakings to address the concerns I had raised. Further undertakings were later offered as the application progressed.
The Australian Nursing and Midwifery Federation (ANMF) and the United Workers’ Union (UWU), each being bargaining representatives for the Agreement, filed Form F18s indicating that they did not support approval of the Agreement on the basis that it does not pass the BOOT, was not genuinely agreed to, and does not meet the requirements of s.180(5) of the Act. The Health Services Union (HSU) filed a Form F18 indicating that it did not wish to advise the Commission that it supports or opposes approval of the Agreement, but acknowledged the concerns raised by the ANMF and UWU. The Australian Workers’ Union (AWU) also filed a Form F18 and after proposed undertakings have been provided by the Employer, generally expressed support for approval of the Agreement.
ANMF’s concerns
The ANMF submitted that the Agreement is not capable of approval, as the Employer did not take all reasonable steps to explain the terms of the Agreement and their effect in relation to matters including wages and working hours, in contravention of s.180(5) of the Act. The ANMF referred to a document provided by the Employer to employees dated 22 April 2024, “QLD Enterprise Agreement Our Offer”, which stated that the Agreement provides for pro rata early access to long service leave after 7 years’ continuous service. The ANMF submitted that this caused some employees to vote in favour of approving the Agreement, who then requested to change their vote upon learning this benefit was not conferred by the Agreement. The ANMF also claimed that the Employer misrepresented reductions in benefits as increases in benefits.
The ANMF also noted that the Employer’s explanation of the Agreement failed to enable employees to understand if they were to receive an increase in their base rate of pay, and if so, the amount of that increase. The ANMF pointed to the absence of any percentage or dollar amount of wage increases from the Agreement. Had the Employer provided employees with a comparison, the ANMF submitted that employees would have had certainty as to whether the Agreement would result in a pay increase.
In providing its view that the Agreement does not pass the BOOT, the ANMF highlighted seventeen areas in which it considered that employees would be worse off under the Agreement than the Nurses Award.
UWU’s concerns
The UWU raised in its Form F18 that it does not consider that the Agreement was genuinely agreed to. Referencing the Full Court of the Federal Court of Australia in One Key Workforce Pty Ltd v Construction, Forestry, Minin and Energy Union,[1] the UWU stated that for the Commission to be satisfied that there was genuine agreement, there must be evidence of “a higher quality of consent (over and above bare agreement)”.
The UWU submitted that the Employer did not adequately highlight or address detrimental conditions, and misrepresented standard award terms as “new” or beneficial conditions.
The UWU submitted that the Agreement does not pass the BOOT, firstly in respect of wages. The UWU submitted that certain classification streams under the Agreement do not contain pay points, meaning those employees are not eligible for pay progression, where they otherwise would be under the relevant award.
The UWU submitted that employees would be worse off under the Agreement than under either the Aged Care Award or the SCHADS Award in respect of approximately 10 terms.
Sections 186 and 187 of the Act allow the Commission to accept undertakings to rectify BOOT concerns. However, these undertakings may only be accepted if they are not likely to result in substantial changes to the Agreement, in accordance with s.190(3)(b) of the Act. The UWU argued that the number and nature of deficiencies are such that any undertakings would result in substantial changes to the Agreement, meaning the Agreement is not capable of approval.
Conference and Hearing
Given the number of issues with the Agreement raised by the Commission, and the concerns raised by the Unions, I convened a conference with the parties on 19 June 2024. At the conference, the Unions pressed their concerns with the Agreement, and the Employer later confirmed that it wished to proceed with the approval application. Accordingly, on 21 June 2024, I issued directions to the parties for the filing of submissions and evidence ahead of a Hearing held on 5 August 2024.
At the Hearing, the Employer was represented by Mr Jamie Wells, solicitor of Mills Oakley Lawyers. Mr Kevin Crank, Industrial Officer, appeared for the ANMF; Mr Alec Nash, Senior Industrial Officer, appeared for the UWU; and Ms Cheri Taylor, Industrial Advocate, appeared for the AWU. The following witnesses gave evidence at the hearing and were cross-examined:
· Ms Carly Carloss, Head of Employee Relations and Remuneration;
· Mr Carrington Blackett, Enrolled Nurse; and
· Ms Tara McKelligott, Facility Manager.
Transitional provisions
The Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) (the Amending Act) made a number of changes to enterprise agreement approval processes in Part 2-4 of the Act, commencing operation on 6 June 2023.
Under transitional arrangements, amendments made by Part 14 of Schedule 1 to the Amending Act in relation to genuine agreement requirements for agreement approval applications apply where the notification time for the agreement was on or after 6 June 2023. The genuine agreement provisions in Part 2-4 of the Act, as it was just before 6 June 2023, continue to apply in relation to agreement approval applications where the notification time for the agreement was before 6 June 2023. Question 18 of the Form F17A provides that the notification time for the Agreement was 26 May 2023.
Under the transitional arrangements, amendments made by Part 16 of Schedule 1 to the Amending Act in relation to the better off overall test requirements for agreement approval applications apply where the agreement was made on or after 6 June 2023. The better off overall test provisions in Part 2-4 of the Act, as it was just before 6 June 2023, continue to apply in relation to agreement approval applications where the Agreement was made before 6 June 2023. Question 26.2 of the Form F17A provides that the Agreement was made on 9 May 2024.
Section 188 of the Act as it existed prior to 6 June 2023 provided:
“(1) 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:
(i) subsections 180(2), (3) and (5) (which deal with pre-approval steps);
(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.
(2) An enterprise agreement has also been genuinely agreed to by the employees covered by the agreement if the FWC is satisfied that:
(a) The agreement would have been genuinely agreed to within the meaning of subsection (1) but for minor procedural or technical errors made in relation to the requirements mentioned in paragraph (1)(a) or (b), or the requirements of sections 173 and 174 relating to a notice of employee representational rights; and
(b) The employees covered by the agreement were not likely to have been disadvantaged by the errors, in relation to the requirements mentioned in paragraph (1)(a) or (b) or the requirements of section 173 and 174.”
Sections 180(5) and (6) of the Act deal with how the terms of an agreement must be explained to employees and are reproduced below:
“Terms of the agreement must be explained to employees etc.
(5) The employer must take all reasonable steps to ensure that:
(a) the terms of the agreement, and the effect of those terms, are explained to the employees employed at the time who will be covered by the agreement; and
(b) the explanation is provided in an appropriate manner taking into account the particular circumstances and needs of those employees.
(6) Without limiting paragraph (5)(b), the following are examples of the kinds of employees whose circumstances and needs are to be taken into account for the purposes of complying with that paragraph:
(a)employees from culturally and linguistically diverse backgrounds;
(b)young employees;
(c)employees who did not have a bargaining representative for the agreement.”
The Form F17A detailed that approximately 1098 employees to be covered by the Agreement are from a non-English speaking background. There are 166 employees aged under 21 years.
Voting outcome
The Agreement, if approved, will cover 4,760 employees. A total of 3,319 eligible employees voted, with 1,766 voting to approve the Agreement; constituting a yes vote of 53%, a relatively slim margin.
Evidence given
In evidence given during the Hearing, Ms Carloss was taken to the wage rates in the Agreement. She agreed that the classification table in the Agreement is an amalgamation of the classifications of the four nominally expired agreements currently in operation.
In the lead up to putting the Agreement to vote, the Employer had prepared for its own use a translation document to assist in understanding how each employee under the four agreements would be classified under the Agreement in each of the following streams:
· Administration
· Allied Health
· Care
· Hospitality
· Lifestyle
· Maintenance
· Nursing.
The translation document, provided to the Commission following the Hearing is detailed and complex. Understandably, moving from four agreement classifications to one combined classification structure is not a simple task. In one new classification descriptor alone, that being Admin Stream, Level 4 (Certificate IV), paying $27.61 on approval of the Agreement, the current classification descriptors across the four nominally expired agreements are as follows:
· Admin L4P1
· Admin L4P2
· Admin L4P3
· Non Nursing Level 5 Pay Point 1
· Non Nursing Level 4 Pay Point 2 (with over award rate)
· Non Nursing Level 4 Pay Point 1
· Non Nursing Level 4 Pay Point 2
· Administration Grade 3 Paypoint 1 Year 1
· Administration Grade 3 Paypoint 2 Year 2
· Clerical Grade 3.
Regrettably, the Employer did not share with employees asked to vote on the Agreement, nor the bargaining representatives, a copy of the translation document.
The following evidence was given during the Hearing:
Ms Taylor:….. So I understand that this agreement is an amalgam of various different agreements and whilst the majority of employees were from Bolton Clarke, there were those from other entities. In addition to this wages table in the EA, is there a broader table that sits behind this, that maps the classification rates of the four agreements to this one agreement?
Ms Carloss:Yes, there is. It's not included in this document. We just have some translation principles. But, no, that translation document is not contained in here.
Ms Taylor:…. So that translation document is not something that was sent to employees, to inform them as to what their classification levels would translate to, in the proposed EA?
Ms Carloss:Correct.
Ms Taylor: Thank you.
Commissioner: Why not? I haven't seen it, have I?
Ms Carloss:No, it's not included in here. It's a payroll - well, it's a remuneration spreadsheet that we have, that maps all the pay codes to the new proposed classification and we had intended, if the agreement got approved, to advise the employees, at that point, through a letter outlining what their new classification is.
Commissioner: Why didn't you do that before? Why didn't you say, 'Mary, you're this, under the agreement you'd be that', if you did all that work beforehand?
Ms Carloss:Yes.
Commissioner: They'd know, wouldn't they? 'I'm currently getting $26.83 an hour under this. It looks like I'm going to get the same, or more', if you had done all that work?
Ms Carloss:Yes, we had. Yes.
Commissioner: How hard would it have been to individualise communication to each employee?
Ms Carloss:It's a huge volume of work, but that doesn't mean that it shouldn't be done, if that's what needed to be done. We were trying to move it along fast. We had pressure to do that, so that was probably why that step didn't happen and we had linked it into the - the outcome of the EA approval step instead.
Commissioner: How difficult do you think it is for, let's say, an immigrant worker, to pick up this proposed agreement and go, 'I'm a level X'?
Ms Carloss:It's not as - I mean the wages table represent the awards. We know the awards are complex for someone who doesn't operate in this space. So that's not a helpful response, I appreciate that.
Commissioner: And they're doing it as early as 22 April, aren't they, because you haven't showed it to them any earlier than that?
Ms Carloss:Correct. Yes. Yes.
Commissioner: Why the rush?
Ms Carloss:We had lots of pressure to go fast to try to minimise no campaigns. We knew the unions didn't support the agreement. We were hopeful that if we could get our material out and explain it to our employees that showcase all the benefits. As I said, the large majority of our employees sat on a very expired RSL Care Agreement, it was a 2018 expiry. The conditions were well out of date and they were well below the award so we knew that there was a lot of upside for this cohort of employees which, again, was the large majority covered by the agreement, and we wanted to get a favourable vote, in advance of a no campaign. That's the truth of it.
Commissioner: Right. When you filed your F17 you didn't provide a reckoning of - - -?
Ms Carloss:Yes, it is in there. That F17 has it in there. Yes.
Commissioner: Right. Is it in the court book?
Ms Carloss: Sorry, I'm just trying to find the F17.
Commissioner: Yes, it's on quite a few pages. So it's at 9, so page 18 of the court book?
Ms Carloss:Thank you. Yes. Sorry, this maps the proposed schedule classification structure to the award structure, not, sorry, the underpinning awards, the agreements, sorry. The underpinning agreements.
Commissioner: So it's the proposed agreement to the awards?
Ms Carloss: To the awards, yes, not - - -
Commissioner: But you had also done work - - -?
Ms Carloss: Yes.
Commissioner: - - - on all employees - - -?
Ms Carloss: Mapped.
Commissioner: - - - mapping their classification under their particular agreement?
Ms Carloss:Yes.
Commissioner: But didn't tell the employees?
Ms Carloss: Correct.
Commissioner: Because you wanted to beat the no vote?
Ms Carloss: Essentially. It doesn't sound very good, does it?
Commissioner: Not really. Not at 53 per cent. What have you answered in respect of the demographics?
Ms Carloss:Sorry, Commissioner, the other reason we - there's no excuse, I absolutely understand where you're coming from, but we had communicated to our employees that no one would go backwards, in terms of wage rates.
Commissioner: Yes, I understand that. But the point made by the ANMF is that they won't know if they're going to get a pay rise until after the agreement is approved?
Ms Carloss:Correct.
Commissioner: So they don't know?
Ms Carloss:Yes. We also, just because of the timing of where we went out, we were also due to have the Fair Work minimum award uplift announced, after the vote. So we had also communicated to our employees that the wage rates would likely be obsolete by the time the agreement's approved because the Fair Work minimum award uplift is likely to supersede the rates contained in the EA. So that was also something that we were sharing with employees. And we also talked about this agreement not being - while rates are very important, this was actually around consolidation of terms. So our sector, we do page, across the sector, around award rates, it's not uncommon, and so we really did focus our campaign on consolidation of terms and lifting of terms.
In written closing submissions, the Employer submitted that when the Employer commenced road show briefings with employees from 8 April 2024, employees were informed of the new classification structure and were informed that a 2% increase to the minimum wage rates applying for each classification level would be paid.
The Employer submitted that it anticipated that approximately 92% of employees to be covered by the Agreement would get an uplift from their current minimum enterprise agreement wage rate of an average 60 cents per hour. Those employees who were being paid greater than the rates proposed in the Agreement would maintain their pay rate and not receive that particular increase.
The Employer submitted that following the Annual Wage Review Decision providing substantial increases to employees, some of the rates within the Agreement are now superseded by the rates now required to be paid under the modern awards.
The Employer submitted that no employees had expressed that they did not understand their classification under the Agreement.
In written closing submissions, the ANMF and UWU repeated their objections to the Agreement being approved on a number of grounds, including that the Agreement could not have been genuinely agreed to.
Consideration
A Clerical Grade 3 employee presently covered by the McKenzie Aged Care Group Enterprise Agreement 2016 is, according to the Employer’s translation document, a Level 5 – General under the Aged Care Award, and a Level 4 (Certificate IV), Administration Stream, under the Agreement. How would the employee know? Only the Employer has the relevant classification knowledge for its 4000+ employees it proposes to be covered by the Agreement.
The Employer intended on informing employees of their correct classification under the Agreement when the Agreement was approved, not when they voted. Yet the information was within the Employer’s knowledge. The Employer’s evidence is that it was racing to beat a no campaign being run by some of the Unions.
The Employer submitted that it communicated to employees that nobody would receive a reduced rate of pay under the Agreement, but the Employer did not inform the employees what rate of pay they would actually receive if the Agreement was approved. There could be no certainty whether a particular employee was part of the cohort of 92% of employees receiving an unknown pay increase, or part of the 8% of employees not receiving a pay increase.
In GBC Contracting Pty Ltd,[2] Gostencnick DP said the following in respect of the statutory obligation to take “all reasonable steps”:
“[43] A requirement or obligation to take “all reasonable steps” seems to me to require the identification of the steps a reasonable person would regard as reasonable in the circumstances that apply. Whether particular steps are reasonable will depend on the particular circumstances existing at the time the obligation arises. A requirement to take all reasonable steps does not extend to all steps that are reasonably open in some literal or theoretical sense...”
In Australian Workers' Union v Rigforce Pty Ltd t/a Rigforce[2019] FWCFB 6960, the Full Bench stated the following:
“[40] In the circumstances, the reasonable step required to be taken by Rigforce for the purpose of s 180(5) was to give an accurate explanation of any change in the quantum of the rates of pay that would be effected if the RFD Agreement displaced the ICS Agreement. This step was all the more necessary because the minimum rates of pay for permanent employees were to be reduced at least until 1 July 2020 if not for longer. Rather than the explanatory document clearly identifying the reduction in rates, it incorrectly conveyed to employees that the rates constituted an increase upon those contained in the ICS Agreement. The explanatory statement said that the minimum rates of pay in the “RFD Agreement have been increased”. The clear import of these words is that the rates in the RFD Agreement had been increased as against the ICS Agreement, not simply that they had been increased from some earlier offer. The statement must be read in the context of the table in the explanatory statement, the relevant column of which was concerned with the question “How does the RFD Agreement change from the ICS Agreement?” The evidence of Mr O’Brien before us does not demonstrate that this error was ever identified to employees let alone corrected. It makes unavailable the conclusion that s 180(5) was complied with.”
In the matter before me, the Employer did not inform its 4,760 employees to be covered by the Agreement what their classification under the Agreement would be and the rate of pay that would apply to them, even when this was within the Employer’s knowledge. I have also had regard to the significant number of employees to be covered by the Agreement who are from non-English speaking backgrounds and the failure by the Employer to properly inform this large cohort of employees of their new classification and new pay rate.
The Employer clearly did not take all reasonable steps, as it was required to do so, to ensure that the terms of the Agreement, and the effect of those terms were explained to the employees. It is an obligation that, pursuant to s.180(5), must be met. I conclude that s.180(5) has not been complied with.
Section 188(1)(c) considerations
Having satisfied myself that the Agreement has not been genuinely agreed to pursuant to s.180(5), it is not necessary to consider s.188(1)(c) as it existed prior to 6 June 2023, as to whether there are no other reasonable grounds for believing that the Agreement has not been genuinely agreed to by the employees.
Section 188(2) consideration
An agreement with a notification time prior to 6 June 2023 can be found to have been genuinely agreed to but for minor procedural or technical errors made in relation to the requirements in s.188(1)(a) or (b), among other sections of the Act (as it was prior to 6 June 2023). An additional consideration is the Commission must be satisfied that the employees covered by the agreement were not likely to have been disadvantaged by the errors.
In Rigforce Pty Ltd [2020] FWC 591, Commissioner Lee, on remittal from the Full Bench, had the task of determining whether the agreement in that matter could be approved by the matters detailed in s.188(2), and whether s.188(1)(c) had been complied with. The Commissioner said the following in his deliberation of the matter before him with respect to the s.188(2) consideration:
“[39] When determining the application of s.188(2) of the Act, it is necessary to evaluate the underlying purpose of the relevant section of the Act. In Huntsman, the Full Bench held that the underlying purpose of s.180(5)(a) is to ensure that employees understand the effect of the enterprise agreement that is to be voted on, enabling them to make an informed decision when casting their vote.
[40] In this case, the Applicant inaccurately informed the relevant employees that the rates of pay in the Agreement had been increased from those contained in the predecessor ISC Agreement. However, the Agreement rates of pay for permanent employees were in fact less than what employees were receiving under the ISC Agreement. As a result of providing this incorrect information to the employees, the Applicant did not comply with the requirements of s.180(5) of the Act in relation to the Agreement.
[41] As noted above, the Full Bench stated that:
‘It is a statement of the obvious that rates of pay are, to employees, likely to be the most fundamentally important aspect of an enterprise agreement. That position was not different here merely because the employees at that time were receiving actual rates of pay higher than what was proposed in the RFD agreement because, as the statement of Mr. O’Brien revealed, the employees were concerned about the prospect of their pay rates being reduced in the future to those in the Agreement and the Applicant advised them that this could possibly happen.’
[42] While this statement was made by the Full Bench in its consideration of compliance with s. 180(5), the observations are relevant to the consideration of whether the misleading information was “minor” within the meaning of s. 188(2). In the Huntsman decision, the Full bench noted that: “What constitutes a ‘minor’ error calls for an evaluative judgment having regard to the underlying purpose of the relevant procedural or technical requirement which has not been complied with and the relevant circumstances.”
[43] As the purpose of s. 180(5) is to enable employees to make an informed decision, the AWU submits that the provision of incorrect information to employees runs wholly counter to the underlying purpose of s.180(5) as it inevitably leads to employees being misinformed. The AWU also submit that an error that leads to such incorrect information being provided is entirely incapable of being characterised as ‘minor.’ I do not agree with the AWU that it is ‘entirely incapable.’ Each case turns on its own facts. However, I do agree that in the circumstances in this case, the error was not a minor error. An incorrect statement that the rates of pay in the new Agreement had been ’increased’ is a matter of considerable significance.
[44] I also agree with the AWU submission that it is not available for the Commission to conclude that the error would be unlikely to disadvantage employees. On the basis that the rates of pay in an enterprise agreement are of fundamental importance to employees and the effect of the error made by the Applicant was to lead employees to believe that the rates of pay in the Agreement they voted to approve were superior to those that applied to them at the time, it is clear that at least the permanent employees are likely to be disadvantaged by the error.
[44] For the reasons above, I am not satisfied that the error is a minor error as contemplated by s. 188(2)(a). Further, I am not satisfied that the employees covered by the Agreement were not likely to have been disadvantaged by the error. Therefore, I am not satisfied that s. 188(2) can overcome the non-compliance with s. 180(5) of the Act.” [references omitted]
I am not satisfied that the failure to comply with s.180(5) was a minor procedural or technical error. The Employer had within its knowledge the classification mapping of each and every employee to be covered by the Agreement. It purposefully elected not to share with the employees voting on the Agreement the rates of pay and classification the Employer had deemed them, on account of racing to beat a no campaign.
It was available to the Employer to take its time and to communicate individually to the many employees what their classification under the Agreement would be and what their rate of pay would be. Employees would then be informed when casting their vote. Whilst administratively burdensome, it was the right and proper thing to do.
As I am not satisfied that the failure to satisfy s.180(5) was a minor procedural or technical error, it is not necessary for me to consider s.188(2)(b) to determine if the employees were not likely to have been disadvantaged by the error. If it were necessary to do so, I would not have been satisfied that the employees were not likely to have been disadvantaged by the error. I consider that the employees would have been disadvantaged by the error.
For the reasons above, I am not satisfied that the error is a minor error as contemplated by s.188(2)(a) (as it was prior to 6 June 2023). If it were necessary to do so, I would not be satisfied that the employees covered by the Agreement were not likely to have been disadvantaged by the error. Therefore, I am not satisfied that s.188(2) can overcome the non-compliance with s.180(5) of the Act.
Undertaking to cure non-compliance with s.180(5) of the Act
It is available to the Employer to propose an undertaking to cure the non-compliance with s.180(5) of the Act.
In Rigforce (on remittal), Commissioner Lee was not satisfied that the undertaking offered by the employer in the application before him could cure the non-compliance of s.180(5) and s.188(1)(c) in that matter. The Commissioner held:
“[54] The Applicant submits that the undertaking brings the Agreement in line with the explanation that employees received. It is true that the rates of pay are now increased to more than that of the ICS Agreement as a result of the undertaking. The Applicant submits that any undertaking that increased the rates above the ICS Agreement, be it by 1%, 5% or some other amount, would satisfy the concern. I agree that proposed undertaking brings the Agreement in line with the explanation the employees received and in that sense cures the deficiency identified with respect to s.180(5).
[55] However, even if the undertaking proffered satisfies the concern that arises under s.180(5), that does not necessarily resolve the other reasonable ground for believing that the Agreement has not been genuinely agreed to. The explanation provided to employees did not quantify what the increase in minimum rates was. This is not a case where the employees were told that they would be entitled to 5% more than the ICS Agreement rates, but in fact they were not. In those circumstances an undertaking aligning the rates with the purported 5% increase would likely resolve the concern. However, in this case there is only the vague explanation that the minimum rates of pay had been increased.
[56] I do not know what employees had in mind when deciding to vote for the Agreement, having been given the information, “The minimum rates of pay in the RFD Agreement have been increased” and what that statement meant to them. As the Full Bench observed, there was an obligation to provide an accurate explanation of any change in the quantum of the rates of pay that would be effected if the Agreement displaced the ICS Agreement. As mentioned previously, there was no indication of the quantum of the change, only the misleading statement that the rates had been increased. Employees voting for the Agreement may have understood that explanation to mean an increase of a small amount on their previous rates, or a significant amount. In the absence of any explanation as to what quantum the rates were to be increased by, one can only speculate.” [references omitted].
I am not satisfied that there is any undertaking the Employer can give in this matter to cure the non-compliance of s.180(5), particularly on account of the increase to the award rates now potentially usurping some of the wage rates within the Agreement.
The Employer ought to have regard to this decision and the concerns of the various Unions in respect of the BOOT, which would now be measured to a higher standard in any future enterprise agreement on account of the increases to the award rates and conditions since the Annual Wage Review Decision.
Conclusion
I have determined that pursuant to the obligation within s.180(5) of the Act, the Employer did not take all reasonable steps to ensure that the terms of the Agreement, and the effect of those terms, were explained to the relevant employees.
I have determined that I am not satisfied that the non-compliance with s.180(5) of the Act meets the requirements of s.188(2) of the Act (as it was before 6 June 2023).
I am not satisfied that there is any undertaking the Employer can give to cure the non-compliance of s.180(5).
I am not satisfied that the Agreement meets the legislative requirements under the Act and accordingly the application for approval of the Agreement is dismissed. Having dismissed the application, it is not necessary to make any determination in respect of the BOOT.
COMMISSIONER
Appearances:
J Wells of Mills Oakley Lawyers for the Applicant.
K Crank for the Australian Nursing and Midwifery Federation.
A Nash for the United Workers’ Union.
C Taylor for the Australian Workers’ Union.
Hearing details:
2024.
Brisbane.
5 August.
Final written submissions:
19 August 2024.
[1] [2018] FCAFC 77, [141].
[2] [2018] FWC 1466.
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