Shop, Distributive and Allied Employees Association v Aldi Foods Pty Limited as General Partner of Aldi Stores (A Limited Partnership)
[2018] FWCFB 5727
•11 SEPTEMBER 2018
| [2018] FWCFB 5727 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604—Appeal of decision
Shop, Distributive and Allied Employees Association
v
ALDI Foods Pty Limited as General Partner of ALDI Stores (A Limited Partnership)
(C2015/6909) (C2016/1264)
VICE PRESIDENT CATANZARITI | SYDNEY, 11 SEPTEMBER 2018 |
Appeal against decision ([2016] FWCA 2028) of Deputy President Bull at Sydney on 5 April 2016 in matter number AG2015/4917; and appeal against decision ([2015] FWCA 6373) of Deputy President Bull at Sydney on 22 September 2015 in matter number AG2015/3510.
Vice President Catanzariti and Commissioner Cirkovic
[1] On 22 September 2015 the ALDI Regency Park Agreement 2015 (Regency Park) was approved by Deputy President Bull, 1 and on 13 October 2015 the Transport Workers’ Union (TWU)2 and the Shop, Distributive and Allied Employees Association (SDA) lodged appeals against that decision.3 On 22 February 2016, the Full Bench of the Fair Work Commission (Commission) dismissed both appeals.
[2] On 5 April 2016 the SDA lodged an appeal against the approval decision of the ALDI Jandakot Agreement 2015 (Jandakot). 4 That appeal was subsequently adjourned pending the outcome of the SDA’s application for judicial review against the Full Bench decision in the Regency Park proceeding.
[3] On 29 November 2016 the Full Federal Court quashed the decision of both the Deputy President and the Full Bench in relation to the Regency Park agreement. 5 ALDI Foods Pty Limited as General Partner of ALDI Stores (A Limited Partnership) (ALDI) appealed that decision to the High Court, and on 6 December 2017 the High Court in part, upheld ALDI’s appeal and remitted the question of whether the Regency Park agreement had passed the Better Off Overall Test (BOOT) to a Full Bench of the Commission.
[4] On 6 April 2018, both the Regency Park and Jandakot proceedings were brought on for mention. The parties agreed that both proceedings be stayed, pending the outcome of the Loaded Rates Agreement decision. Prior to the Loaded Rates Agreement decision being issued, the SDA submitted that its appeal in the Jandakot proceedings ought to be upheld following the Full Bench decision 6 in the ALDI Minchinbury and Derrimut proceedings which had determined that the ALDI Minchinbury and Derrimut agreements could not have been approved by reason of ALDI’s non-compliance with the Notice of Employee Representative Rights (NERR) requirements under ss.173 and 174 of the Fair Work Act 2009 (Cth) (Act). More specifically, ALDI had distributed a NERR to its employees prior to the making of the Minchinbury and Derrimut agreements which substituted the word “leader” for the “employer”.7 The SDA now seeks leave of this Full Bench to amend its grounds of appeal to address the same NERR compliance issue in the Regency Park proceedings.
[5] On 20 June 2018, ALDI notified the Commission that it was preparing an application for judicial review in the Federal Court against the Full Bench’s decision in the ALDI Minchinbury and Derrimut proceedings and that the Jandakot proceedings ought to be stayed pending the determination of its judicial review application in the Federal Court. ALDI further advised that it would oppose the SDA’s application to amend its grounds of appeal, asserting that the SDA had been previously given leave to amend its grounds of review in the Federal Court to include a similar NERR issue, which was ultimately unsuccessful and left unchallenged in the High Court.
[6] On 25 June 2018 the SDA wrote to the Commission contending that in relation to the Jandakot proceeding;
1. That the proceeding has been previously deferred and adjourned for some time, and the fact that ALDI is seeking to invite the Federal Court to revisit the same issue that has already been raised before the Federal Court 8 should not be a basis on which to stay the matter.
2. Should the Commission determine the Jandakot appeal by applying the Full Bench’s decision in the ALDI Minchinbury and Derrimut proceedings, ALDI would suffer no material disadvantage as it would be equally entitled to make an application to the Federal Court for review. To that end, it would be “administratively convenient” for the Federal Court to require that all applications raising identical grounds of review be joined and dealt with together. By proceeding to deal with the matter, the Commission would be facilitating that outcome.
3. Arguably, there is authority to support the proposition that compliance with s.174(1A) does not raise matters which go to reviewable jurisdictional error and therefore it is not likely that the Federal Court will entertain ALDI’s judicial review application.
[7] In the same correspondence dated 25 June 2018, the SDA contended that in relation to the Regency Park proceeding;
1. The SDA was unsuccessful in raising the NERR issue before the Federal Court because the SDA had not raised such matter with the Deputy President at first instance or the Full Bench on appeal. This was the case because ALDI had purportedly omitted to identify that it had “altered the prescribed contents of the NERR” until after the Full Bench issued its decision. When the SDA became aware of the NERR issue, it immediately sought and obtained leave to amend its ground of review in the Jandakot Federal Court proceeding.
2. The SDA did not go on to press the NERR issue in the Jandakot High Court proceeding because the issue had been dealt with by the Full Court on discretionary grounds, which could not support an application for leave.
3. To deny the SDA leave to amend would be to permit ALDI to advantage itself by its own earlier non-disclosure.
4. In the context of the matter being remitted to the Commission, the Commission must be satisfied that the requirements of s.174(1A) have been met. Knowing that the Regency Park agreement has not met those requirements, and that a differently constituted Full Bench has already dismissed two of ALDI’s approval applications (in Minchinbury and Derrimut) on the same basis, the SDA seeks leave to amend its grounds of appeal in Regency Park and for the Commission to immediately determine the matter on the same basis urged in Jandakot.
[8] Having received the parties’ correspondence, the matters were again brought on for mention on 5 July 2018 and subsequently programmed for a Full Bench hearing. On 2 August 2018 we heard the parties on;
a) Whether the Jandakot appeal is to be adjourned until the Federal Court determines ALDI’s judicial review application 9 in Minchinbury and Derrimut on the NERR compliance issue; and
b) Whether leave be granted to the SDA to amend its grounds of appeal in the Regency Park appeal to include the following ground with respect to the NERR compliance issue:
“The Deputy President erred in approving the agreement in circumstances where no valid NERR under s.174 of the Fair Work Act was given to employees as required by s.173 of the Fair Work Act prior to the making of the agreement.”
[9] In the hearing, Mr W. L. Friend QC of counsel appeared for the SDA and Mr G. Hatcher SC and Ms A. Perigo of counsel appeared for ALDI.
Consideration
[10] Having considered the materials filed with the Commission and the parties’ oral submissions in relation to the two questions above, we have determined to adjourn the Jandakot appeal, and to refuse the SDA’s application to amend its ground of appeal in Regency Park until the Federal Court determines ALDI’s judicial review of the Full Bench decision in Minchinbury and Derrimut on the NERR compliance issue. We also note that ALDI’s judicial review application has been set down for hearing before the Full Federal Court on 15 November 2018.
[11] In our view, the NERR compliance issue is not only common to both the Jandakot and Regency Park appeals, but central to how the appeals ought to be dealt with as a matter of course. As such we consider that it would be inappropriate for us to progress the Jandakot and Regency Park appeals any further until the Federal Court determines ALDI’s judicial review application.
[12] To do otherwise would cause unnecessary prejudice to the employees who are presently covered by the Jandakot and Regency Park agreements. For instance, if we were to grant leave for the SDA to amend its grounds of appeal in Regency Park, and for Regency Park and Jandakot to be determined in accordance with the Minchinbury and Derrimut Full Bench, that is, for both approval decisions to be quashed by reason of ALDI’s failure to comply with the NERR requirements; employees presently covered by the agreements would revert back to the Award as there is no earlier agreement(s). Should the Federal Court then overturn the Minchinbury and Derrimut Full Bench, this would effectively mean that the Commission would have unnecessarily ‘unscrambled’ a scrambled egg. 10
[13] Notwithstanding the potential prejudice, the SDA submitted that the Commission ought to determine the appeals in accordance with law because it would be “wrong” to allow the agreements to operate with the known and “evident defects” of its approval whilst the Commission awaits the resolution of ALDI’s judicial review application “which may take some time”. As noted earlier in this decision, since the SDA first lodged its appeals against the Regency Park and Jandakot approval decisions (that is, from October 2015 and April 2016 respectively), an extensive amount of litigation has flowed. To suggest that these proceedings should not be delayed any further would be to overlook the fact that these proceedings have already been subject to years of litigation. Moreover, to assert that it would be “wrong” for the Commission to not deal with the appeals “in accordance with law”, would be to speculate on the outcome of the judicial review proceedings in Minchinbury and Derrimut. Certainly, it is apparent from the parties’ submissions that there is a live dispute as to whether the Full Court in the Regency Park proceedings treated the NERR compliance issue as a jurisdictional error. 11 This issue amongst other matters raised in ALDI’s originating application,12 challenge the very basis on which the SDA seeks to rely on in urging the Commission to determine the Jandakot and Regency Park appeals. Until the Federal Court squarely determines those matters, the “law” as it currently stands in the Minchinbury and Derrimut Full Bench decision is uncertain.
Conclusion
[14] For these reasons, we consider that it would not be appropriate for the Commission to proceed the Jandakot proceedings any further and for the SDA to amend its grounds of appeal to include the NERR compliance issue in Regency Park at this point in time.
[15] Both the Jandakot and Regency Park appeal proceedings are adjourned pending the determination of ALDI’s judicial review of the Minchinbury and Derrimut Full Bench decision.
VICE PRESIDENT
Deputy President Gostencnik
[16] I have had the opportunity of reviewing a draft of the decision and accompanying reasons of Vice President Catanzariti and Commissioner Cirkovic for refusing to grant the SDA permission to amend its notice of appeal in the Regency Park agreement appeal proceeding and for adjourning both the Jandakot and Regency Park appeal proceedings pending the determination of ALDI’s application for judicial review of the Full Bench decision in ALDI Stores (A Limited Partnership) v Shop, Distributive and Allied Employees Association; National Union of Workers; Transport Workers’ Union of Australia (Derrimut & Minchinbury). 13 I am respectfully unable to join in that decision or the reasons therefore.
[17] I would allow the amendment of the notice of appeal in the Regency Park agreement appeal proceedings and I would not allow the adjournment of that appeal proceeding or of the Jandakot appeal proceeding. My reasons may be shortly stated.
[18] The relevant background is set out in the reasons of the majority and I need not repeat it here. For convenience I have hereafter adopted the abbreviations used by the majority in their reasons.
Amendment to the notice of appeal
[19] The application for permission to amend the notice of appeal in the Regency Park matter would, if granted, have the effect of raising for consideration the question whether the NERR given to relevant employees who would be covered by the Regency Park agreement was a valid notice and, if not, whether the decision to approve the Regency Park agreement was vitiated by a appellable error.
[20] The principal objection of ALDI to the SDA’s application to amend its notice of appeal in the Regency Park agreement appeal proceeding is that the sole matter remitted to the Full Bench of the Commission by the High Court is the issue whether the Regency Park agreement passed the BOOT. ALDI contends that the High Court had before it two matters. The first concerned the coverage of the Regency Park agreement. The second concerned whether the agreement passed the BOOT. The High Court allowed ALDI’s appeal in relation to the coverage issue, but ALDI failed in its appeal in relation to the BOOT issue. The decision of the Full Bench of the Commission dismissing the SDA’s appeal against the decision to approve the Regency Park agreement was affected by jurisdictional error and was quashed by a writ of certiorari and a writ of mandamus was issued directed to the Full Bench of the Commission requiring it to proceed to determine the SDA’s appeal according to law.
[21] ALDI argues that consequently it is the SDA’s appeal in respect of the BOOT that was remitted by the High Court to the Full Bench of the Commission to be determined according to law and that this leaves only the first instance decision concerning the BOOT before the Full Bench, and nothing else.
[22] Whilst it is undoubtedly true that the only matter requiring determination by a Full Bench arising from the SDA’s notice of appeal originally lodged in the Commission is the BOOT issue, it does not follow for that reason alone nor from the circumstances in which the appeal is before us, that permission to amend the notice of appeal cannot or should not be granted. The writ of mandamus issued by the High Court and directed to the Commission requires us to determine the SDA’s appeal from the decision and orders of Deputy President Bull made on 22 September 2015 in matter number AG2015/3510 according to law. It is thus the appeal from that decision which is before us. It is to be accepted that the High Court has determined the coverage issue that is the subject of the appeal and that the BOOT issue, which was not determined, now needs to be determined by this Full Bench. The appeal before us is conducted by way of rehearing. Section 586 of the Act gives the Commission a discretionary power to amend any application or any other document related to a matter before the Commission on any terms it considers appropriate. This power is plainly exercisable in relation to this appeal. The issue then is whether the discretionary power to amend should be exercised.
[23] If permission to amend the notice of appeal to include the NERR point is granted, this would on the present state of authorities 14 likely be determinative of the appeal, subject to the exploration of a possible undertaking. This is an important consideration weighing in favour of allowing the amendment. Though there is some possible prejudice to the Respondent beyond having the appeal determined according to law as identified by the majority, I do not consider this to be a particularly weighty consideration against the exercise of a discretion allow amendment of the notice of appeal. The possibility that eggs may need to be unscrambled is relevantly to be assessed against the conduct of ALDI in finding itself in this position. In this regard, the Full Bench’s first observation in Derrimut & Minchinbury at [29] seems to me to be apposite. The Full Bench observed:
“We would add two further comments. First, Aldi distributed the NERRs for the Derrimut Agreement and the Minchinbury Agreement well after the Peabody Moorvale decision was issued, so it not clear to us why such a major corporation issued its NERRs in the form that it did...” 15
[24] A further discretionary consideration weighing in favour of an amendment is that if the amendment is not allowed, the impugned agreement will continue to operate according to its terms, subject to determining the BOOT issue, even though on recent and current authority, the agreement was likely invalidly approved. In the result there would be triumph to technicality and legal form over merit and substance. This is inconsistent with the manner in which the Commission should perform its functions and exercise its powers. 16 I accept that with some diligence the SDA could have but did not discover the apparent defect in the NERR. After all it had a copy of the notice. But in this case not to allow the SDA to argue the point of appeal would have the effect of permitting an arguably invalidly approved agreement to continue to operate because the SDA (and perhaps the Commission also) did not exercise appropriate diligence. In the circumstances I do not consider this factor to weigh against the exercise of the discretion to allow the amendment.
[25] It should be evident from the above, I consider the discretionary considerations favouring the amendment ought outweigh those going the other way. For these reasons I would therefore allow the amendment.
Adjournment
[26] In my view both appeals are properly before us and should proceed at least on the NERR point. The arguments on appeal on the NERR point could be reduced to writing and the appeals on that point could be determined on the papers. If we were not persuaded to depart from the decision in Derrimut & Minchinbury the appeals in each case would be upheld and (to suggest the question of undertakings) the decisions approving the agreements would likely be quashed. It would be open to ALDI to apply for judicial review of any such decision and to request that these be dealt with concurrently with the judicial review proceeding in the Derrimut & Minchinbury matter. For completeness, I should not be taken by this decision to have reached a concluded view on the appeals. There remains in my view at least some force the observation of Jessup J in SDAEA v Aldi Foods Pty Ltd 17 at [49], notwithstanding the rejection of it by Katzmann J18 which is worthy of further exploration.
[27] I would not allow the adjournment of the appeals.
DEPUTY PRESIDENT
Appearances
Mr W. L. Friend QC, of counsel, for the SDA
Mr G. Hatcher SC and Ms A. Perigo, of counsel, for ALDI
Hearing details
2018.
Melbourne:
2 August.
1 [2015] FWCA 6373.
2 C2015/6904.
3 C2015/6909.
4 C2016/1264.
5 Shop, Distributive and Allied Employees Association v ALDI Foods Pty Ltd (2016) 245 FCR 155.
6 [2018] FWCFB 2485.
7 Hereafter referred to as the “NERR compliance Issue”.
8 (2016) 245 FCR 155.
9 NSD1097 of 2018.
10 Shop, Distributive and Allied Employees Association v ALDI Foods Pty Ltd [2017] FCA 6 at [6].
11 (2016) 245 FCR 155.
12 Summarised at paragraph [51] of ALDI’s submissions dated 25 July 2018.
13 [2018] FWCFB 2485.
14 Ibid.
15 Ibid at [29].
16 See s.557 and s.578 of the Act.
17 (2016) 245 FCR 155, [2016] FCAFC 161.
18 Ibid at [56] – [70].
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