Sommerville Electric Pty Ltd

[2019] FWC 7876

[2019] FWC 7876

FAIR WORK COMMISSION

REASONS FOR DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Sommerville Electric Pty Ltd
(AG2019/2101)

Electrical contracting industry
DEPUTY PRESIDENT BOYCE	SYDNEY, 19 NOVEMBER 2019

Application for approval of the Somerville Electric Pty Limited Single Enterprise Agreement 2019 — roll-over enterprise agreement — proposed enterprise agreement bargained directly with employees — union request to be heard pursuant to s.590 of the Fair Work Act 2009 – union request to be heard rejected — whether reasonable steps to explain the terms and the effect of terms of proposed enterprise agreement — whether proposed enterprise agreement passes the better off overall test — proposed enterprise agreement approved.

Overview

[1] An application has been made for approval of an enterprise agreement to be known as the Somerville Electric Pty Limited Single Enterprise Agreement 2019 (Agreement). The application is made pursuant to s.185 of the Fair Work Act 2009 (Act). It has been made by the employer, Somerville Electric Pty Ltd (Applicant). The Agreement is a single enterprise agreement.

[2] Of the 30 employees entitled to vote to approve the Agreement, 30 employees voted, and 29 employees voted to approve the Agreement (i.e. a 96.67 percent majority of employees voted to approve the Agreement).

[3] Rates of pay under the Agreement are up to 35 percent above the relevant modern (reference) award, being the Electrical, Electronic and Communications Contracting Award 2010 (Award).

[4] Two employees were appointed as bargaining representatives on behalf of some of the relevant employees.

CEPU request to be heard pursuant to s.590 of the Act rejected

[5] The Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) objects to the approval of the Agreement. The CEPU was not involved in the bargaining process for the Agreement, and even if approved by the Commission, the CEPU does not request to have the Agreement cover it.

[6] The CEPU accepts that it was not a bargaining representative (default or otherwise) in respect of the Agreement. Despite this, the CEPU sought to be heard in this matter pursuant to s.590 of the Act, to oppose the approval of the Agreement. This request was opposed by the Applicant.

[7] By way of written submissions dated 19 July 2019, the CEPU accepted that it had no right to be heard in the matter other than by way of permission under pursuant to s.590 of the Act. In summary, the CEPU submitted that:

a) it had coverage (under its Rules) and membership within the electrical contracting industry; and

b) it is likely that the CEPU will have members employed by the Applicant, and thus covered by the Agreement, into the future, to whom the CEPU will likely be representing the industrial interests of.

[8] Having regard to the foregoing, the CEPU submitted that it is appropriate that the CEPU be allowed to be heard in this matter, and involved as a contradictor, to enable the scrutiny that comes with a contested hearing to occur.

[9] In Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited,¹ the Full Bench stated the following, in respect of s.590 of the Act, in the context of the Commission’s enterprise agreement role:

“[75] We would make the observation however, that the Commission may choose, in a particular case, to hear from an employee organisation or any other person about the approval of an agreement even though the organisation or person may not otherwise have a right to be heard. The Commission has a broad power to inform itself in relation to any matter in such manner as it considers appropriate, including by inviting oral or written submissions from a person of organisation. (sic) (Section 590)”

[10] Pursuant to s.590(1) of the Act, I have determined to reject the CEPU’s request to be heard pursuant to s.590 of the Act. In this regard, the CEPU:

a) was not a bargaining representative for the Agreement;

b) was not involved at all in the bargaining process that led to the making of the Agreement;

c) does not seek to have the Agreement (if approved) cover it;

d) does not assert that it has any members currently in the workplace, or any members employed by the Applicant during bargaining or at the time the Agreement was made; and

e) has brought no evidence of any history of involvement in the Applicant’s workplace, and has not been covered by the last two enterprise agreements applying at the workplace (see paragraph [15] below).

[11] I also take into account that whilst the rules and objects of an industrial organisation invariably provide for the organisation to “improve, protect, and foster the best interests of the union and its members”, union Rules, coverage, and likely future membership at a workplace are not a basis (of themselves) upon which a request to be heard under s.590 derives or ought be granted. The CEPU has not identified any exception to this principle in its submissions.

[12] Significantly, given the CEPU was not involved in the bargaining process (or a bargaining representative) for the Agreement, and has no members at the workplace, any involvement by the in these proceedings could only be based upon submission and conjecture. I therefore do not accept that such involvement by the CEPU could or would assist the Commission.

Roll-over enterprise agreement

[13] The Agreement replaces the Somerville Electric Pty Ltd Single Enterprise Agreement 2015, 2and the Somerville Group Pty Ltd Single Enterprise Agreement 2011.3 Both of these preceding enterprise agreements are in essentially the same terms.

[14] The CEPU did not apply to be covered by the 2015 Agreement or the 2011 Agreement. The parties to the 2015 Agreement, and the 2011 Agreement, are the Applicant and its relevant employees.

[15] In this matter, the Agreement essentially rolls over the 2015 Agreement, with pay rises and allowance increases.

Explanation of the terms, and the effect of those terms, to relevant employees

[16] The facts and circumstances, along with the nature of any explanation given, mean that what constitutes “all reasonable steps” necessarily varies. 4 The term “all reasonable steps” does not give rise to the requirement for “perfection”.5 The assessment is a value judgement, and there are no absolute rules. It equally follows that what is required by way of evidence to satisfy the Commission in terms of compliance with ss.180(5) and s.188 of the Act necessarily varies, and there are no absolute rules as to what is required or to be relied upon.

[17] Taking in to account the submissions of the Applicant, the Witness Statement of Mr Mark Anglicas (the Applicant’s Project Director), and the information set out in the F17 Form (including the attachments thereto) filed in this matter, I am satisfied that the Applicant:

a) undertook all reasonable steps, including during the access period, to explain the terms of the Agreement and the effect of those terms to employees, in a manner appropriate (taking into account the circumstances and needs of relevant employees, 6 the long history of agreement making at the workplace, and the presence of employee bargaining representatives);

b) explained relevant and material less beneficial terms (between the Agreement and the 2016 Agreement) to employees (I note that I am not aware of any less beneficial terms between the two agreements); and

c) did not mislead employees (by way of act or omission) in respect of the differences between the Agreement and the 2016 Agreement.

[18] In coming to the foregoing determination (and the relevant satisfaction as to compliance with s.180(5), extending to s.188, of the Act) I have had direct regard to the fact that the Agreement replaces the 2015 Agreement, and that the “circumstances” of steps taken are to be considered having regard to the relevant circumstances applying at the workplace. 7

BOOT and NES

[19] In reaching my conclusion that the Agreement easily passes the better off overall test (BOOT) under s.193 of the Act, I rely upon the undertakings proffered by the Applicant, and the clarification of relevant terms and conditions in the Agreement as contained in the Applicant’s submissions.

[20] I note that the Commission (via the Applicant) sought the views of relevant bargaining representatives on the Applicant’s proposed undertakings, all of who made no objection to same. 8

[21] More specifically, having regard to the submissions of the Applicant, and the decision of the Full Bench of the Commission in SDA v Beechworth Bakery Employee Co Pty Ltd t/as Beechworth Bakery, 9 I am satisfied that employees will be better off overall under the Agreement when compared to the Award. I note that taking into account the undertakings, the ordinary rates of pay under the Agreement are up to over 35 percent above Award rates of pay (excluding additional allowances and shift/weekend penalties that are payable above such rates of pay).

[22] I am equally satisfied that the more beneficial entitlements of the NES will prevail where there is an inconsistency between the Agreement and the NES, and that the Agreement contains no unlawful terms.

Conclusion

[23] In view of these Reasons for Decision, the Agreement is approved in accordance with my Decision in [2019] FWCA 7874.

DEPUTY PRESIDENT

Appearances:

Ms Gordon Jervis appeared for the Applicant.

Printed by authority of the Commonwealth Government Printer

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

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1 (2014) 246 IR 21; [2014] FWCFB 7940.

 2   AG2015/5476.

 3   AG2011/8023.

 4   NTEU v University of NSW (2011) 210 IR 244; [2011] FWAFB 5163.

 5   CFMEU v Shamrock Civil Pty Ltd[2018] FWCFB 1722 at [36].

 6   Form F17, Item 4.3 (4 employees under 21 years of age, 4 employees over 45 years of age, no employees from non-English speaking backgrounds).

 7   See: BGC Contracting Pty Ltd [2018] FWC 1466 at [87].

 8   Fair Work Act 2009 s.190(4).

 9   [2017] FWCFB 1664 at [12].