Thiess Pty Ltd T/A Thiess

[2015] FWC 595

[2015] FWC 595

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees

Thiess Pty Ltd T/A Thiess
(AG2014/10754)

DEPUTY PRESIDENT ASBURY BRISBANE, 28 JANUARY 2015

Transfer of employees employed under the Leighton Sonoma Enterprise Agreement 2009.

[1] Pursuant to s318 of the Fair Work Act 2009 (the Act) an application was lodged by Thiess Pty Ltd T/A Thiess (the Applicant) on 10 December 2014 relating to instruments covering a new employer and transferring employees.

[2] The Applicant sought the following orders under ss.318(1)(a) and (b) of the Act:

● The Leighton Sonoma Enterprise Agreement 2009 being a transferable instrument which because of section 313(1)(a) of the Fair Work Act 2009 (Cth) would, or would be likely to, cover Thiess Pty Ltd (Theiss) and any employee of Leighton Contractors Pty Limited (Leighton) who accepts employment with Thiess, does not cover and will not cover Thiess or any employee of Leighton who accepts employment with Thiess.

● The Thiess Mining Q Coal Operations Northern Hub Enterprise Agreement 2014 will cover any employee of Leighton who is a transferring employee in relation to the transferring work.

Legislation

[3] Section 318 of the Act provides:

“Orders relating to instruments covering new employer and transferring employees

Orders that the FWC may make

(1) The FWC may make the following orders:

(a) an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;

(b) an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.

Who may apply for an order

(2) The FWC may make the order only on application by any of the following:

(a) the new employer or a person who is likely to be the new employer;

(b) a transferring employee, or an employee who is likely to be a transferring employee;

(c) if the application relates to an enterprise agreement—an employee organisation that is, or is likely to be, covered by the agreement;

(d) if the application relates to a named employer award—an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (b).

Matters that the FWC must take into account

(3) In deciding whether to make the order, the FWC must take into account the following:

(a) the views of:

(i) the new employer or a person who is likely to be the new employer; and

(ii) the employees who would be affected by the order;

(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment;

(c) if the order relates to an enterprise agreement—the nominal expiry date of the agreement;

(d) whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace;

(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;

(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;

(g) the public interest.

Restriction on when order may come into operation

(4) The order must not come into operation in relation to a particular transferring employee before the later of the following:

(a) the time when the transferring employee becomes employed by the new employer;

(b) the day on which the order is made.

[4] Section 50AAA of the Corporations Act 2001 (Cth) provides:

“50AAA Associated entities

(1) One entity (the associate) is an associated entity of another entity (the principal) if subsection (2), (3), (4), (5), (6) or (7) is satisfied.

(2) This subsection is satisfied if the associate and the principal are related bodies corporate.

(3) This subsection is satisfied if the principal controls the associate.

(4) This subsection is satisfied if:

(a) the associate controls the principal; and

(b) the operations, resources or affairs of the principal are material to the associate.

(5) This subsection is satisfied if:

(a) the associate has a qualifying investment (see subsection (8)) in the principal; and

(b) the associate has significant influence over the principal; and

(c) the interest is material to the associate.

(6) This subsection is satisfied if:

(a) the principal has a qualifying investment (see subsection (8)) in the associate; and

(b) the principal has significant influence over the associate; and

(c) the interest is material to the principal.

(7) This subsection is satisfied if:

(a) an entity (the third entity) controls both the principal and the associate; and

(b) the operations, resources or affairs of the principal and the associate are both material to the third entity.

(8) For the purposes of this section, one entity (the first entity) has a qualifying investment in another entity (the second entity) if the first entity:

(a) has an asset that is an investment in the second entity; or

(b) has an asset that is the beneficial interest in an investment in the second entity and has control over that asset.”

[5] Material provided by the Applicant discloses that Q-Coal determined from 19 January 2015 that:

● Leighton will cease performing the contracted work at Sonoma (meaning Leighton will no longer require the work performed by the Leighton Employees to be performed by anyone), and will not be considered in the future for further work with Q Coal; and

● Thiess will commence performing the contracted work previously performed by Leighton at Sonoma, and may also be contracted to perform similar work at other Collinsville Q Coal mines in the future, and that Thiess' performance of this work is subject to it being able to engage its workforce on the terms and conditions contained in the Thiess Mining Q Coal Operations Northern Hub Enterprise Agreement 2014.

[6] At the time of Application Leighton employed 167 operational employees (wages employees) to perform work for Q Coal at Sonoma Mine.

[7] Employees employed by Leighton to work at the Sonoma mine were employed under the Leighton Sonoma Enterprise Agreement 2009 which had passed its nominal expiry date.

[8] Thiess is a party to the Thiess Mining Q Coal Operations Northern Hub Enterprise Agreement 2014 which was approved on 13 November 2014 and nominally expires on 13 November 2017.

[9] Leighton and Thiess are ‘associated entities’ as that term is defined in section 50AAA of the Corporations Act 2001.

[10] Thiess has made conditional offers of employment to all the Leighton employees. The offers of employment are subject to, and conditional upon, the approval of the granting of the orders sought in the Application.

Relevant Considerations

[11] Thiess seeks to employ staff of Leighton and to provide continuing employment to as many employees as possible, and have them perform the transferring work. The view of Thiess is that failing the granting of orders sought, no Leighton Employees will be employed by Thiess.

[12] Thiess has made conditional offers of employment to staff employed by Leighton; employees who do not accept the offer will not be employed and will not be covered by the order.

[13] If employees do not accept the offer, their employment with Leighton shall become redundant and employees will be entitled to participate in Leighton’s ordinary redundancy process.

[14] Thiess have acknowledged that whilst some employees will be better off overall under the Thiess Mining Q Coal Operations Northern Hub Enterprise Agreement 2014,when compared with the Leighton Sonoma Enterprise Agreement 2009,other employees will not. Accordingly Thiess have agreed to provide additional benefits to employees who accept conditional offers.

[15] The Leighton Sonoma Enterprise Agreement 2009 nominally expired on 4 February 2014, the Thiess Mining Q Coal Operations Northern Hub Enterprise Agreement 2014 nominally expires on 13 November 2017.

[16] Thiess submitted that there would be significant productivity impacts if two enterprise agreements applied to employees performing the same work.

[17] Thiess submitted that it would suffer significant financial disadvantage if the Leighton Sonoma Enterprise Agreement 2009 covered Thiess, particularly increased administrative and wage costs.

[18] Thiess submitted that although there is some synergy between the two agreements, there is a lack of synergy in several material respects.

[19] Statements of a number of employees, currently employed by Leighton, were filed with this application. Each statement confirmed the individual employee’s support for the orders being made.

[20] The application as served upon the Construction, Forestry, Mining and Energy Union (CFMEU), being an employee organisation covered by both agreements. The Commission sought the views of the CFMEU, specifically the Mining & Energy Division Qld District, to the application and orders sought. The CFMEU has confirmed that it does not have a position in relation to the application and did not seek to be heard further in relation to the matter.

[21] There are no grounds on which a finding could be made that the orders sought in this Application would be contrary to public interest.

[22] I have considered the matters set out in s.318(3)(a) to (g) of the Act and I am satisfied on the basis of supporting documentation provided with the application and the additional material provided that the orders should be issued. Consequently the Application is granted and Orders in the terms sought will be issued accordingly.

DEPUTY PRESIDENT

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