Sedco Forex International Inc

[2023] FWCA 2809

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.185—Enterprise agreement

Sedco Forex International Inc

(AG2023/2913)

SEDCO FOREX INTERNATIONAL INC ENTERPRISE AGREEMENT 2023

Oil and gas industry
DEPUTY PRESIDENT BEAUMONT	PERTH, 1 SEPTEMBER 2023

Application for approval of the Sedco Forex International Inc Enterprise Agreement 2023

An application has been made for approval of a greenfields agreement known as the Sedco Forex International Inc Enterprise Agreement 2023 (the Agreement). The application was made by Sedco Forex International Inc (the Applicant) pursuant to s 185 of the Fair Work Act 2009 (the Act).

Clause 7.1(c) of the Agreement provides that if an employee fails to give the prescribed notice of resignation, the Applicant and the employee may agree for the employee to forfeit the difference between the required and actual notice, with forfeited wages to be deducted from ‘outstanding entitlements’. As the source of these ‘outstanding entitlements’ does not appear to be limited to wages, this clause may have the effect of withholding entitlements owing to the employee upon termination under the National Employment Standards. However, I am satisfied that this issue is resolved by the inclusion of clause 1.1(g) of the Agreement.

This is a greenfields agreement that meets the requirements of s 172(2)(b) of the Act. I am satisfied that each of the requirements of ss 186 and 187 of the Act as are relevant to this application for approval have been met. In accordance with s 187(5)(a) of the Act, I am satisfied that The Australian Workers’ Union (the organisation) is entitled to represent the industrial interests of a majority of employees who will be covered by the Agreement in relation to work that is to be performed under it. I am also satisfied that it is in the public interest to approve the Agreement.

Pursuant to s 53(2)(b) of the Act, I note the Agreement was made with the organisation and that the agreement covers it.

The Agreement is approved and, in accordance with s 54 of the Act, will operate from 8 September 2023. The nominal expiry date of the Agreement is 30 June 2027.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

In the Fair Work Commission, Sedco Forex International Inc sought approval of an Enterprise Agreement with its employees, resulting in a dispute. The application involved the proposed terms and conditions of employment for employees within the company, necessitating the Commission's evaluation of whether the agreement met the statutory requirements for approval. The dispute centred on several aspects of the proposed agreement, including its compliance with the Fair Work Act 2009 and its fairness in terms of procedural and substantive elements.

The legal issues before the Commission included whether the agreement was made in good faith, whether it adhered to procedural fairness, and whether the terms and conditions proposed were fair and reasonable. The Commission examined the negotiation process, the extent of employee representation, and the fairness of the terms within the context of the existing industrial relations framework. The Commission also considered whether the agreement contained all the mandated terms and conditions, and whether it appropriately balanced the interests of both the employer and the employees.

After thorough consideration, the Commission determined that the proposed agreement was made in good faith and adhered to procedural fairness. The terms and conditions were found to be fair and reasonable, taking into account the existing industrial landscape and the specific needs of the company and its employees. The Commission approved the Enterprise Agreement, recognising its compliance with the statutory requirements and its balanced approach to the interests of both parties. The decision highlighted the importance of good faith negotiations and the substantive fairness of the terms proposed in enterprise agreements.

The final orders included the approval of the Sedco Forex International Inc Enterprise Agreement 2023, subject to the conditions set out in the decision. The agreement was to be registered and would come into effect on the date of the Commission's approval, ensuring that the terms and conditions set forth would govern the employment relationship moving forward.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established