Ugl Engineering Pty Ltd
[2025] FWCA 3111
•16 SEPTEMBER 2025
| [2025] FWCA 3111 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.185 - Application for approval of a greenfields agreement
Ugl Engineering Pty Ltd
(AG2025/2753)
UGL OFFSHORE MAINTENANCE GREENFIELDS ENTERPRISE AGREEMENT 2025
| Oil and gas industry | |
| DEPUTY PRESIDENT O'KEEFFE | PERTH, 16 SEPTEMBER 2025 |
Application for approval of the UGL Offshore Maintenance Greenfields Agreement 2025
UGL Engineering Pty Ltd (Applicant) has made an application to the Fair Work Commission (FWC) under s.185 of the Fair Work Act 2009 (Cth) (the Act) for approval of the UGL Offshore Maintenance Greenfields Enterprise Agreement 2025 (the Agreement). The Agreement was made with the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers Union (AMWU), the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) and the Construction, Forestry and Maritime Employees Union (CFMEU).
Approval of the Agreement is opposed by the Australian Workers’ Union (AWU) on the grounds that the AMWU, the CEPU and the CFMEU (collectively “the Unions”) cannot represent the industrial interests of a majority of the employees who will be covered by the Agreement. The AWU has a further concern related to the public interest, being that in essence the Applicant has sought to avoid engaging with the principal union in the hydrocarbons industry – being the AWU – who have coverage of all workers in that industry. The AWU sought permission to be heard with respect to approval of the Agreement and the Applicant opposed such permission being granted. I requested submissions on the issue of the AWU being heard and having reviewed those submissions, I granted permission for the AWU to be heard. The relevant decision citation is [2025] FWC 2683.
Having granted permission for the AWU to be heard, I requested submissions from the Unions as to why they could represent the industrial interests of a majority of the employees who will be covered by the Agreement and submissions from the AWU on why this was not the case. In making an assessment of which employees would be covered by the Agreement I was guided by evidence provided by Mr Douglas Cochrane who is the Operations Manager for the Applicant. Consistent with my findings in UGL Pluto Upgrade Project Agreement [2024] FWC 1137 (Pluto) at [31]-[32], I am satisfied that the most reliable assessment of the classifications and number of employees in each classification likely to be engaged is provided by the Applicant itself.
In his evidence, Mr Cochrane states that the Agreement will be used to tender for work on the Woodside Scarborough Project Floating Platform Unit (FPU). Of significance is that this offshore facility has a limit of the number of persons – being 75 - who can be on board at any one time. It was Mr Cochrane’s further evidence that of the 75 persons, the maintenance contractors would be limited to a total of 15 persons. Consistent with this figure and the use of “back to back” rosters, Mr Cochrane expects the Applicant to employ a total of 30 persons to work the contract.
In terms of a breakdown of those employees, it was Mr Cochrane’s evidence that they would fall into the following categories[1]:
Occupation Number of
Employees
Classification in
Proposed Agreement
Instrument/Electrical trades 8 Trade/Technician Senior Trade Mechanical trades 8 Trade/Technician Senior Trade Advanced Rigger/ Scaffolders 8 Multiskilled Services Technician Painter Blasters 6 Multiskilled Services Technician TOTAL 30
In Pluto I made the following observation with respect to assessing the ability to represent the industrial interests of employees:
“The task for the Commission is to be satisfied that the employee organisations to be covered by the Agreement are, as a group, entitled to represent the industrial interests of the employees who will be covered by the Agreement. There is no requirement to consider the industry standing of those employee organisations with respect to whether they are the principal union or unions in the industry, or whether the grouping of employee organisations is the same or usual grouping found elsewhere. The Act clearly permits any combination of employee organisations provided that as a group they can represent the industrial interests of a majority of the relevant employees”.[2]
As with my decision in Pluto, I will use “entitled to enrol as members” as a proxy for “able to represent the industrial interests of”. Turning first to the joint submissions of the AMWU and CEPU I find that those two unions claim to be in a position to enrol 24 out of the 30 employees shown above. In terms of the specifics, the AMWU and CEPU coverage is submitted to operate as follows.
With respect to the Senior Trade and Trade classifications in the Agreement the AMWU says those eight employees falling within the mechanical trades will be either mechanical fitters or boilermakers. I note that in making this statement the AMWU relies on the supplementary witness statement of Mr Dougles Cochrane at [6]. With respect to these classifications, the AMWU says as follows:
“The AMWU can cover all 8 of those workers under rule 1A of its rules. Rule 1A(a) expressly refers to the trade or calling of ‘fitters’. The AMWU can also cover those workers under rule 1A(f) as the ‘mechanical fitter’ classification is a metal trade.
As regards boilermakers, firstly, the AMWU can cover boilermakers under rule 1A(a) because boilermaking is an engineering trade. Secondly, the AMWU can also cover boilermakers under rule 1A(f) because boilermaking is a metal trade. And third, the AMWU can cover boilermakers under rule 1A(b)(i) - which is its boilermaker rule.
In relation to rule 1A(b)(i) of the AMWU’s rules (the operation of which does not affect the AMWU’s coverage of boilermakers under rules 1A(a) or 1A(f))…
…(t)o the best of the AMWU’s knowledge, the AWU was not able to cover boilermakers under its rules as they stood on 1 September 1965. As such, the exclusion in rule 1A(b)(iv) of the AMWU’s rules does not apply to rule 1A(b)(i) in relation to boilermakers.”[3]
With respect to the eight employees identified as advanced riggers / scaffolders, the AMWU says as follows:
“The AMWU can cover these employees because they will be performing their duties “in connection with” ‘fitters’ and boilermakers which are trade-level occupations covered under rule 1A(a) of the AMWU’s rules.”[4]
With respect to the eight employees engaged in the instrument and electrical trades, the CEPU notes the supplementary witness statement of Mr Cochrane where he states the employees will be electricians and qualified instrument fitters. With respect to such employees, the CEPU says as follows:
“The CEPU can cover those workers under a number of its rules. First, the CEPU can cover those workers under rule 2.1 – which covers all employees whose callings are peculiar to the electrical industry. Second, the CEPU can cover those workers under rule 2.3.9 – which covers electrical installers. And third, the CEPU can cover those workers under rule 2.3.2 – which covers mechanical and scientific instrument makers.”[5]
I note for completeness that the AMWU also claims to be able to cover such workers pursuant to a rule covering electrical installers, electrical wiremen and electrical workers generally in Western Australia.
This leaves the six employees described as painter blasters. The CFMEU made submissions with respect to these workers. The CFMEU cited the contents of its rules numbered 2(A)(b), 2(A)(b)(d), 2(A)(b)(k) and 2Q(2) which deal with tasks associated with painting. It submits that these rules allow it to cover the six employees described as painter blasters.
In its submissions, the AWU does not appear to dispute that the Unions can cover the thirty employees proposed by the Applicant as being those to be covered by the Agreement. Instead, the AWU addresses its submissions to a broader point. Specifically, while it is the case that the Agreement’s coverage clearly incorporates those thirty employees, the AWU says that its coverage goes beyond those categories and in doing so includes some categories of employees that the Unions cannot enrol as members. The AWU states as follows:
“This is despite the Proposed Agreement having a scope that extends far beyond three trades on a single project off the coast of Western Australia. In addition to the broader geographical scope, the Proposed Agreement covers far more classifications, including many that neither of the Signatory Unions have any coverage of, such as:
a. Insulators;
b. Riggers and Scaffolders;
c. Laggers;
d. Service Technicians (Heli Ops, Marine Ops, Deck Ops);
e. Store Persons;
f. Trades Assistants;
g. General Service Officers; and
h. Industrial Cleaners.”[6]
The AWU submits that if the Agreement was only to cover the FPU then its scope would reflect only the classifications required for that particular work. It submits that:
“On the plain and ordinary meaning of the words used in ss.187(5)(a) and 53, the Commission must be satisfied that the Signatory Unions are entitled to represent the industrial interests of the employees that the agreement expresses to cover. There is nothing in the Act that suggests that this legislative requirement can be displaced entirely or even fettered to any extent via an applicant employer asserting that despite the scope of the agreement being broader, it will simply engage a narrower cohort of employees. Accordingly, it cannot.”[7]
The AWU takes further issue with the Applicant and the Unions’ case as follows:
“…the Applicant seeks to satisfy the Commission of compliance with s.187(5)(a) through evidence that purports to set out what classifications that the Applicant intends to engage should it be successful in its tender for the Scarborough Project Floating Platform Unit workscope (FPU). However, the Applicant’s evidence carries significant flaws:
Firstly, the Applicant has not yet been invited to tender for the FPU workscope – it just ‘anticipates’ that Woodside will invite the Applicant to do so;4
Secondly, because of the above, the Applicant has not secured any work that the Proposed Agreement will cover and the evidence in relation to the classifications and number of employees that the Applicant may engage is necessarily rooted in speculation (it hasn’t even received the tender documentation); and
Thirdly, the Applicant’s evidence, that the Proposed Agreement will be utilised by the Applicant for a single work opportunity to engage only electricians, instrument fitters, mechanical fitters and boilermakers does not address why the scope of the Proposed Agreement is far broader in both location and classification coverage.”[8]
The AWU also takes issue with what it sees as the Applicant deliberately excluding it from negotiations when it is aware that the AWU has industry coverage in hydrocarbons. It goes on to say as follows:
“It cannot be in the public interest for the Commission to approve the Proposed Agreement where:
a)The scope of the Proposed Agreement far exceeds the Applicant’s claimed intended use of the Proposed Agreement in circumstances where the Applicant could have made an agreement with a more appropriate scope;
b)The Signatory Unions do not possess the constitutional coverage to enable them to represent the industrial interests of a majority of employees that can be engaged under the terms of the Proposed Agreement;
c)The evidence of the Applicant in relation to the employees it intends to engage under the Proposed Agreement is based entirely on speculation – it hasn’t even been invited to tender on the FPU work scope;
d)The Applicant has made a deliberate, industrial decision to negotiate with the unions that it wishes to rather than the unions that it needs to for the purposes of s.187(5) and as a result most of the potential future employees who may be covered by the Proposed Agreement were not represented in negotiations;
e)The unions that the Applicant did negotiate (sic) not only have limited constitutional coverage but also have negligible membership and presence in the sector in which the Proposed Agreement will apply; and
f)The Applicant could have at any time, contacted the AWU to commence negotiations for an enterprise agreement with a broad scope”[9].
Finally, the AWU places reliance on the public interest requirement set out in s.187(5)(b). It submits that
“It is not in the public interest to approve a greenfield agreement negotiated by unions without majority coverage and without the practical coverage in the sector. The Applicant has made a decision to remove the AWU, which is the legitimate bargaining representative on behalf of offshore maintenance workers in the hydrocarbons sector, from the process of bargaining for an enterprise agreement that applies to that work. The Applicant has done this intentionally. The protection in s.187(5)(b) is designed for this exact situation.”[10]
Consideration
It appears to me that the Unions have made a clear case that they can represent the industrial interests of all of the 30 employees the Applicant has identified in its evidence. Indeed, even the AWU does not appear to challenge this notion. However, the AWU does infer that the breakdown of anticipated employees provided by the Applicant must be treated with some level of caution given that they have not yet actually been requested to tender. While that does appear to be the case, I note that assessing the employees to be covered by a greenfields agreement is not an exact science. As Deputy President Colman’s found in BESIX Watpac and CFMEU Minor Civil Construction Union Collective Agreement 2021-2025 (Watpac):
“Greenfields agreements are concerned with the conditions of employment for employees who will be employed by the employer in the future. They are by their nature therefore somewhat predictive.”[11]
In this instance, it is clear that the Applicant is aware of the limitations imposed by the maximum persons on board limit. It is also an organisation with significant experience in providing maintenance services in such situations. Self-evidently, the FWC needs to make an assessment of the employees to be covered. While the AWU may have its concerns, in my view the most appropriate estimate of employees to be covered is that provided by the Applicant itself. I now turn to further arguments of the AWU on the issue of classifications.
As I perceive it, the AWU makes the argument that the interaction of s.53 and s.187(5)(a) of the Act requires that the Unions must be able to represent the industrial interests of a majority of all the classifications covered by the Agreement. It does not accept that the FWC should look only at those classifications the Applicant has identified that it intends to use but rather at the broader list contained within the Agreement. There may be some intuitive appeal to this notion. It begs the question – which the AWU in effect asks – as to why an agreement can be made to apparently address a certain staffing need but nonetheless have a scope that expands well beyond that need.
However, like most matters that come before the FWC, each case needs to be assessed on its own merits. I note in the first instance that the Applicant has sought to constrain the scope of the Agreement to Western Australia and the Northern Territory only. As such, it does not have general application throughout Australia. However, it does appear to include classifications beyond those required for the FPU project.
The AWU – see [12] above - asserts that the Unions cannot cover many of the other positions identified in the Agreement and lists eight positions to illustrate this notion. If I look at those positions, I am satisfied that the Unions can in fact cover a number of them. In the first instance, I look to riggers and scaffolders. In Pluto at [38] I found that riggers are covered by the AMWU and the AMWU – having regard to the “in connection with” provisions of its rules - claims it can cover scaffolders.
With respect to trades assistants, I found in Pluto at [38] that they fell within the coverage of the AMWU, again relying on the use of “in connection with” in the AMWU rules. The same logic can be used to allow the AMWU to enroll store persons and, as I further found in Pluto at [38], insulators. By extension, I am satisfied that given their coverage of insulators via the “in connection with” rule the AMWU could also enroll laggers.
The general service operator classification appears quite broad but is said to include such tasks as basic rigging and stores work which fall within Unions’ coverage and other tasks such as service technicians which do not. For completeness I note that there are an additional four classifications in the Agreement not listed by the AWU. The first is sheetmetal worker and the second is tube fitter / pipe fitter. I am satisfied that these roles would fall within the scope of the AMWU’s rules given that they are metal trades.
The third is offshore endorsed crane operator. While the rules of the CFMEU cover crane drivers, it would appear that there is a limitation that would prevent an offshore crane driver being covered. The fourth is simply titled “HVAC” which I take to be heating, ventilation and air conditioning. I note sub rule 2.3.1 of the CEPU rules covers air conditioning fitters in Western Australia and so I am satisfied that these employees could be covered by the CEPU.
Given this, it would appear that the classifications that may not fall within the coverage of the Unions would be industrial cleaners, service technicians, crane operators and such general service operators whose duties do not fall within the coverage of the Unions.
Having formed a view that there are classifications within the Agreement that do not fall within the coverage of the Unions, I am nevertheless of the view that the Agreement can be approved. I note again the findings of Deputy President Colman in Watpac which address this issue of classifications:
“I agree with the CFMMEU that there are several reasons to conclude that s 187(5)(a) is concerned with the actual employees who will be employed and covered by the agreement, rather than all of the employees who could conceivably fall within the coverage of the agreement. First, the section refers to employees, not to classifications or types of work. If the Parliament had intended the majority coverage requirement to attach to classifications, it could easily have provided for this.
Secondly, s 187(5)(a) requires a quantitative assessment: the Commission must be satisfied that the relevant unions are entitled to represent a majority of employees who will be covered by the agreement. Generally, it would be unworkable for the Commission to undertake this quantitative evaluation by reference to classifications or types of work only, because to say that a union has representation rights in respect of a majority of classifications says nothing about the number of employees who might be employed in those classifications”[12].
Clearly, the AWU remains suspicious of the predictions made by the Applicant with respect to employees to be covered. It clearly thinks – though offers no examples or evidence - that a situation may arise whereby the employees covered by the Agreement goes beyond the 30 employees identified at [5] above. I have considered this possibility, but in doing so have been mindful that the Unions only need be able to represent the industrial interests of a majority – not all – of the employees covered by the Agreement.
For the Unions to be in a position where they could not represent the majority, it would require that there are more employees employed in the classifications they cannot enrol than in the classifications they can enrol. This would mean a workforce where the cleaners, crane drivers, service technicians and possibly half of the general service operators outnumbered the tradespersons, their trades assistants, the insulators and laggers, the painter/blasters, the store persons, the riggers and scaffolders and the remainder of the general service operators.
In terms of predictions, it is difficult to envisage such a workforce. Given this, I am satisfied that the Unions can represent the industrial interests of the majority in both the workforce as predicted by the Applicant, and in any reasonably foreseeable workforce that might arise.
I now deal with the public interest argument advanced by the AWU. In doing so I turn once again to the findings of Deputy President Colman in Watpac:
“… the concept of an ‘appropriate’ union is alien to the Act’s framework for the making of greenfields agreements. It is very clear from s 187(5)(a) that unions with coverage of relevant employees can be left out of negotiations for a greenfields agreement. What is required is that the union or unions that will be covered by the agreement are entitled to represent a majority of the employees who will be covered by the agreement, in relation to work to be performed under the agreement. That an employer has decided not to negotiate with a particular union (even one that might be an obvious potential partner with which to make an agreement in a particular sector) is not relevant to the public interest. As I said in SC Hydro Pty Ltd [2021] FWC 5110 at [52], s 187(5)(a) represents the full extent of the Act’s concern about which unions should be party to a greenfields agreement. It recognises that some unions might have coverage of relevant employees yet not be party to them.”[13]
The AWU makes much of being – to use its words – variously the “principal union in hydrocarbons”, “the legitimate bargaining representative on behalf of offshore maintenance workers” and “the appropriate union.” As is made clear by Deputy President Colman in Watpac these self-bestowed titles have no bearing on the issue of the making of a greenfields agreement. The AWU may bemoan the fact that the Applicant has sought to reach an agreement with other unions who do not hold the same status in the industry as it does. This is irrelevant as it is not the test set out in the Act.
The test in the Act is clearly limited to whether or not the unions involved can, as a collective, represent the industrial interests of a majority of the employees who will be covered by the agreement, in relation to work to be performed under the agreement. Where – as is often the case – there is more than one union able to represent the industrial interests of a particular group of employees, the FWC does not have the authority to grant one union greater status than another with respect to making a greenfields agreement.
The public interest test to be applied for the purposes of s.187(5)(b) was considered by Commissioner Booth in Re: Abigroup Contractors Pty Ltd. In that matter the Commissioner observed as follows:
“In GlaxoSmithKline Australia Pty Ltd v Colin Makin the Full Bench noted that in considering the public interest FWA is required to take into account the following:
The expression ‘in the public interest’, when used in a statute, classically imports a discretionary value judgment to be made to be made by reference to undefined factual matters, confined only by the objects of the legislation in question. [citing Comalco v O’Connor (1995) 131 AR 657 at p.681 per Wilcox CJ & Keely J, citing O’Sullivan v Farrer [1989] HCA 61; (1989) 168 CLR 210]
The Supplementary Explanatory Notes to the Bill reinforce this:
In assessing the public interest, it would be expected that FWA would take into account the objects of the Act, and the need to ensure that the interests of employees who are to be employed under the Agreement are appropriately represented.”[14]
In assessing the public interest in this matter, I am not persuaded by the claims of the AWU regarding its status or its allegations that the Applicant has bypassed it as these arguments find no support in the Act or in case precedent. I have instead had regard for the following issues. Firstly, the Agreement has been collectively bargained between employee organisations and the Applicant consistent with the emphasis on enterprise level bargaining in the Act.
Secondly, I am satisfied that the Agreement protects employees by virtue of the Unions’ ability to represent the industrial interests of a clear majority of employees under any reasonably conceivable scenario. Thirdly, I note that the Agreement pays rates of wage that are between 195.55% to 225.85% above the Manufacturing and Associated Industries and Occupations Award 2020 and 164.30% to 184.15% above the Electrical, Electronic and Communications Award 2020. In addition, it contains guaranteed yearly increases linked to the Wage Price Index.
Fourthly, the Agreement is a comprehensive document containing many above-Award benefits and covering issues such as counselling and disciplinary procedures which are not contemplated by the relevant Awards. Finally, it provides the Applicant with certainty over its costs and allows it to structure its tender offer appropriately. Given this, I am satisfied that it is in the public interest to approve 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, 187 and 188 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 AMWU, the CEPU and the CFMEU are 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 AMWU, the CEPU and the CFMEU and that the Agreement covers these organisations.
The Agreement is approved and, in accordance with s.54 of the Act, will operate from 23 September 2025. The nominal expiry date of the Agreement is 16 September 2028.
DEPUTY PRESIDENT
[1] See Witness Statement of Douglas Cochrane at [12].
[2] UGL Pluto Upgrade Project Agreement [2024] FWC 1137 at [28].
[3] See AMWU and CEPU Submissions at [11]-[13].
[4] Ibid at [19].
[5] Ibid at [17].
[6] See AWU Submissions at [23].
[7] Ibid at [20].
[8] Ibid at [21].
[9] Ibid at [46].
[10] Ibid at [48].
[11] BESIX Watpac and CFMEU Minor Civil Construction Union Collective Agreement 2021-2025 [2022] FWCA 267 at [45].
[12] Watpac at [40]-[41].
[13] Watpac at [54].
[14] Re: Abigroup Contractors Pty Ltd [2012] FWA 3745 at [52]-[53].
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