United Group Rail Services Limited
[2009] FWA 452
•9 OCTOBER 2009
[2009] FWA 452 |
|
DECISION |
Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement
(AG2009/12639)
COMMISSIONER CARGILL | SYDNEY, 9 OCTOBER 2009 |
UGL Rail- Taree Operation Enterprise Agreement 2009-2010.
[1] This decision concerns an application pursuant to section 185 of the Fair Work Act 2009 (the Act) for the approval of an enterprise agreement by United Group Rail Services Limited (United or the company). The agreement is titled UGL Rail- Taree Operation Enterprise Agreement 2009-2010 (the agreement). The application is opposed by the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU or the union).
[2] The matter was heard in Sydney on 21 September 2009. United was represented by Mr Gee, solicitor, who appeared with permission pursuant to section 596 of the Act. The AMWU was represented by Mr Kennedy.
[3] The application for approval, Form F16, was signed by Mr D Paff, National Human Resources Manager - Rolling Stock Division. At point 5 of the form it is noted that the AMWU was a bargaining representative for the agreement. The application was accompanied by a statutory declaration by Mr Paff in terms of Form F17 and a copy of the agreement signed by Mr D Jenkins, Chief Executive of United.
[4] There is no Form F18, declaration for employee representatives, nor is the agreement signed on behalf of the AMWU. There is however a Form F22, notice for employee organisation to be covered, lodged by the AMWU. As I understand it, this has been lodged as a “fall-back” to cover the possibility that the AMWU’s objections are rejected and the agreement approved.
[5] Evidence was given on behalf of United by Mr Paff. In addition to the statutory declaration referred to earlier, Mr Paff also provided an affidavit, Exhibit United 1. Evidence was given on behalf of the AMWU by Mr P. Jones, a United employee and one of the union delegates at the Taree site and Mr C. Lewin, AMWU organiser for the site. Both Mr Jones and Mr Lewin provided statements. These were marked Exhibits AMWU 1 and AMWU 2 respectively. All three witnesses were cross-examined.
[6] During proceedings on 21 September 2009 Mr Gee tendered an undertaking on behalf of United. That undertaking, Exhibit United 2, is on company letterhead and is signed by Mr Styles, General Manager Human Resources. It is in the following terms:
“On behalf of United Group Rail Services Limited (“UGL Rail”), we undertake as follows:
1. While the Agreement is in operation, UGL Rail will apply the terms of the Agreement to employees covered by the Agreement as though all of the terms in the United Goninan - Taree Plant Award 2002 (“Award”) were incorporated as terms of the Agreement, subject to any inconsistency and the Fair Work Act 2009 (“the Act”).
2. That is, UGL will apply the terms of the Award as though the words “and all other terms and conditions” were inserted into the last row and in the second column of the table in clause 5 immediately after the words “Clause 7.7 Parental Leave”.
3. For example, the rates of pay in clause 9 of the Agreement will apply instead of the rates of pay in clause 5.1.1 of the Award. However, any overtime hours worked by an employee covered by the Agreement will be paid at the penalty rates in clause 6.11 (overtime) of the Award.
4. We make this undertaking according to section 190 of the Act, and confirm UGL Rail understands this undertaking will be taken to be a term of the Agreement pursuant to section 191 of the Act.
5. As a consequence, the terms of the Award shall continue to have effect and apply as terms of the Agreement, in accordance with clause 5 of the Agreement as amended by this undertaking.”
[7] Mr Gee stated that the company sought that the undertaking be made as part of the no disadvantage test consideration rather than in the alternative.
BACKGROUND FACTS AND EVIDENCE
[8] Many of the facts and some of the evidence in the matter were not in dispute. Some of the areas of difference went to precise details of conversations and the timing of certain events. I do not intend to refer to all of that material but will concentrate on the important facts and area of dispute that are relevant to my determination.
[9] The existing agreement that applies at the Taree site expired on 15 July 2009. Prior to that date the parties began negotiations for a new agreement. The process began in March 2009 when Mr Lewin held a series of meetings with AMWU members to develop a log of claims to put to the company.
[10] The first formal meeting between the parties took place on 29 April 2009. Further meetings occurred on 18 May and 18 June. Mr Lewin, Mr Jones and Mr Paff were in attendance at each of those meetings as were other delegates and another representative from the company. I note that at paragraph 8 of Exhibit AMWU 1 Mr Jones says that there was also a meeting between the parties on 11 June whilst Mr Lewin at paragraph 15 of Exhibit AMWU 2 says that the meeting on that date was with the members. Nothing turns on this point.
[11] During the course of the negotiating meetings the parties considered certain financial information provided by the company and discussed the union’s log of claims and a draft agreement tabled by United. The evidence of Mr Jones and Mr Lewin is that the company accepted very few of the AMWU’s claims. Minutes of the meetings are at Annexure B to Exhibit United 1.
[12] Mr Lewin held several report back meetings with the members during which the union’s claims were refined and a fall-back position developed. These outcomes were either communicated to Mr Paff by email or put to the company in the meeting on 18 June. It is not disputed that Mr Lewin was given access to employees whenever he requested. The evidence is that Mr Paff and Mr Lewin regularly communicated by email and other methods of exchange about the progress of the negotiations outside of the formal process. An example of this is a chain of emails at Annexure C to Exhibit United 1.
[13] Mr Paff’s evidence is that paid communication meetings were held with employees on 3 and 11 June and 30 July 2009. These meetings were to inform employees of the progress of negotiations. Notification of these meetings was by way of notices placed on each of the noticeboards at the site around five days prior to each of the meetings. Mr Paff’s evidence is that all employees who were on site on each of the relevant days, attended these meetings.
[14] The use of noticeboards is an issue in this matter. The evidence is that there are six noticeboards, one in each of the four manufacturing work areas or sheds, one in the projects area and one in the administration block. Mr Jones’ evidence is that not all employees read what is placed on the noticeboards. Mr Lewin’s evidence is that he uses the noticeboards to communicate with members as well as utilising other methods of communication such as phone, email and face to face meetings. Mr Paff’s evidence is that the noticeboards are a usual method of communication on site although he could not guarantee that all employees read what is placed on the boards.
[15] After the meeting on 18 June 2009 the union members decided that bargaining should be put on hold pending the introduction of the Act on 1 July 2009.
[16] Mr Paff’s evidence is that on 13 July he handed to each of the delegates, including Mr Jones, a notice of employee representational rights, Annexure G to Exhibit United 1. He also placed a copy on each of the six noticeboards. Mr Paff’s evidence is that, during the communication meeting in July, he went through the notice paragraph by paragraph to explain to employees why there was a need to wait for 21 days for a vote. Mr Jones’ evidence is that he cannot recall being given such a notice or seeing it before these proceedings. His evidence is that, to his knowledge, the company did not tell employees about the notice.
[17] Mr Paff gave evidence that he advised Mr Lewin by email that he had provided this notice to the employees and included the notice in his email which is part of Annexure C to Exhibit United 1 and is also Attachment CLI to Exhibit AMWU 2. It is by no means apparent from the email that the notice, or anything else for that matter, was actually attached. However, it should be noted that the legislation does not require that anyone other than employees be provided with the notice.
[18] In his email to Mr Lewin, Mr Paff notes that the new Act had begun and states “as such I am required to put out this notice”. He then goes on to indicate that he had received a request from the consultative committee to move the process forward and would talk to the delegates. In his reply Mr Lewin indicates that the employees are also keen to have further discussion and requests United to provide a response to the union’s fall-back position referred to in paragraph 12 above.
[19] There was a further exchange of emails on 14 July between Mr Paff and Mr Lewin about organising a further meeting, Attachment CL2 to Exhibit AMWU 2 and Annexure C to Exhibit United 1. In his email Mr Lewin notes that it was important that the proposed agreement was one which would be voted up by the employees. He proposed a further meeting in late August after his return from leave. Mr Lewin’s evidence is that he received no response to this request. Under cross-examination he acknowledged that Mr Paff contacted him to arrange a meeting in early August, Annexure E to Exhibit United 1.
[20] On 22 July Mr Paff issued a “Communication Notice” which outlined the steps involved in the agreement-making process under the new legislation and indicated the action that had been taken in relation to each step, Annexure H to Exhibit United 1. Mr Paff’s evidence is that he placed a copy of this notice on each of the noticeboards and emailed it to an email user group at the site. Mr Paff also sent an email to Mr Lewin, Attachment CL3 to Exhibit AMWU 2, which indicated that a proposed agreement had been prepared and would be issued at the appropriate time for a vote. In the email Mr Paff stated that he would need to speak to Mr Lewin about his availability to address the employees at the ballot. The email does not specifically respond to Mr Lewin’s request for bargaining to continue.
[21] Mr Jones’ evidence is that he and the other delegates were called to Mr Paff’s office on 22 July, given a copy of the proposed agreement and told that it was going to be put to a vote. His evidence is that Mr Paff said that he was not interested in sitting down with Mr Lewin and going through it all again. This was the company’s offer and was what was going to a vote. Mr Jones’ evidence is that he was shocked and angered as he believed that bargaining was still continuing. Mr Jones was not challenged in this evidence.
[22] Mr Lewin visited the site on 23 July and met with the delegates. His evidence, and that of Mr Jones, is that it was decided to get advice about the content of the proposed agreement as well as steps which could be taken to stop the ballot taking place. Mr Lewin’s evidence is that it was agreed that the proposed agreement was unlikely to be approved by the employees because the company had rejected an important claim concerning a personal leave incentive scheme.
[23] On 27 July Mr Lewin sent an email to Mr Paff again proposing the inclusion of a personal leave incentive scheme as well as various proposed model clauses, Attachment CL4 to Exhibit AMWU 2 and Annexure E to Exhibit United 1. In the email Mr Lewin informed Mr Paff that he and the delegates believed that the proposed agreement was likely to be rejected by the employees. He concluded by stating that he looked forward to further discussions with Mr Paff.
[24] Mr Paff testified that he did not believe that the parties had ever stopped bargaining. His evidence is that he asked the delegates whether they would oppose the vote to which they responded in the negative. Mr Paff took this as agreement to go ahead. His evidence is that he did not understand that the union had made it clear that they did not want the proposed agreement to go to a vote but instead continue bargaining.
[25] As mentioned in paragraph 19 above, Mr Paff proposed a meeting for 7 August to discuss the union’s suggestions. Mr Lewin was delayed so the meeting took place with the delegates. Mr Jones’ evidence is that the company went through some of the union’s claims and informed the delegates that they were rejected. A claim for delegates’ training leave was accepted.
[26] Mr Lewin arrived on site after the meeting had concluded and met with the delegates. His evidence is that it appeared to him that the company had not genuinely considered the proposals he had put forward in his email of 27 July. Mr Lewin’s evidence is that, as he was leaving the site, he encountered Mr Paff at reception. He informed Mr Paff that the union had concerns about the agreement but couldn’t comment fully until he had received legal advice. Mr Lewin’s evidence is that he mentioned that one of the concerns related to the interaction between the proposed agreement and the relevant award which is identified in the company’s undertaking set out earlier. His evidence is that he told Mr Paff that the union could not support the agreement until he had received advice.
[27] Mr Lewin’s evidence is that Mr Paff informed him that the proposed agreement was to be presented to employees in the week of 10 August and the vote was to take place on 17 August 2009. Mr Lewin requested that it be on 20 August. Mr Paff agreed. Mr Lewin was cross-examined about this evidence and testified that he was “pretty certain” that he had had this conversation with Mr Paff.
[28] Mr Paff was not questioned about whether the conversation had occurred. His evidence is that he received an SMS message from Mr Lewin asking if the vote could be moved to 20 August. In any event, he agreed to move the ballot to suit Mr Lewin’s availability.
[29] On 10 August Mr Lewin emailed Mr Paff requesting an electronic copy of the proposed agreement for review by the union’s research department. He stated that he now would not be able to attend the site on 20 August but that the presence of the delegates at the count should be appropriate. A copy of the agreement was provided by Mr Paff. The relevant email exchange is Annexure F to Exhibit United 1.
[30] Also on 10 August Mr Paff issued a notice informing employees that the ballot for the proposed agreement would be held on 20 August, Annexure I to Exhibit United 1. His evidence is that he placed a copy of this notice on each of the noticeboards together with a Fair Work Australia form. I am not sure what this form is, however nothing turns on this point. Mr Paff’s evidence is that he also emailed this material to the email user group.
[31] Mr Paff’s evidence is that on 10 August a copy of the proposed agreement was distributed at each of the noticeboards for employees to access and a copy was provided to each delegate. Mr Jones’ evidence is that the proposed agreement was placed on the noticeboards on 11 August. Again, the difference in the evidence about the date is not material.
[32] On 11 August Mr Lewin received advice from Mr Kennedy about the content of the proposed agreement, Attachment CL5 to Exhibit AMWU 2. In that advice Mr Kennedy raised a number of points including the fact that the award is completely excluded. A copy of this advice was forwarded to the delegates and placed on “the noticeboard”.
[33] Mr Lewin held a mass meeting with members on 13 August. This was not a paid meeting but was held in the employees’ own time. During the meeting there was discussion about the points raised in Mr Kennedy’s advice. Mr Lewin’s evidence is that it became apparent that members had not been given a copy of the proposed agreement. His evidence is that the meeting passed a unanimous resolution that the union take the company to this Tribunal for breach of good faith bargaining.
[34] Mr Lewin’s evidence is that, following this meeting, he spoke to Mr Paff about the fact that a large proportion of members had not been given a copy of the agreement and had not had a full seven days to consider it. Mr Paff agreed to provide more copies and place them in the lunch rooms. Mr Paff’s evidence is that on 13 August a further 60 copies were made and distributed among the four lunch rooms. His evidence is that the award was freely available from the administration building and copies had been provided to the consultative committee.
[35] Mr Paff’s evidence is that on 11 August an employee asked if he could cast an absent vote. Mr Paff informed the employee that there was no provision for such a process but that he would be told if the situation changed. His evidence is that he saw this employee attend the approval process on 20 August.
[36] Mr Paff’s evidence is that, around 17 August, one of the delegates asked if absentee voting would be available. He responded that such a process was not in place. Mr Paff’s evidence is that no employee or union representative asked that such a process be implemented. Under cross-examination he testified that absentee voting had not been an issue in or available for the five previous agreements with which he had been involved.
[37] Mr Jones’ evidence is that on 17 August he telephoned Mr Paff and asked if the company would be providing for absentee voting as a number of employees had asked him directly about it. His evidence is that Mr Paff indicated that he would enquire about it and provide a response. Mr Jones’ evidence is that Mr Paff didn’t get back to him.
[38] On 18 August Mr Paff issued an “EBA Update” which he placed on each of the noticeboards and emailed to the email user group. This is Annexure J to Exhibit United 1 and also Attachment PJ1 to Exhibit AMWU 1. In the notice, reference is made to the copies of the proposed agreement which had been distributed. Mr Paff asked employees to read the agreement and to contact reception if further copies were required. The greater part of the notice concerns the issue of the interaction between the award and the proposed agreement.
[39] The voting process took place on 20 August. The meeting with the day shift occurred at 2.30pm and the meeting with the afternoon shift at 3.00pm. Mr Paff’s evidence is that, prior to the meeting with the day shift, he met with the delegates to discuss the voting process. During that discussion an employee asked if he could vote early as he was ill and wished to go home. It was agreed, and the employee cast his vote then and placed it in the ballot box.
[40] Mr Jones’ evidence is that one of the other delegates told him that he had earlier suggested to Mr Paff that there be a roll of voters to which Mr Paff had responded that it was a good idea. His evidence is that there was no roll used during the vote. Mr Paff testified during cross-examination that, while he recalled discussing the methodology of the ballot, he could not recall mention of the use of a roll.
[41] Mr Jones also gave evidence that the same delegate asked Mr Paff if employees could be brought in one at a time to ensure each received only one ballot paper. Mr Paff’s response was that it could be done if time permitted. Mr Paff’s evidence is that employees were lined up in single file to cast their vote. This was after the ballot papers had been distributed. The evidence is that, during the vote, the ballot box was being observed by two delegates and the Operations Manager of the site.
[42] The process adopted in each meeting was essentially the same. Both Mr Jones and Mr Paff addressed the employees before the vote took place. Mr Paff’s address included a PowerPoint presentation. His evidence is that, following this, he led a discussion about each clause in the agreement which provided an opportunity for employees to ask questions. Mr Paff’s evidence is that, during this discussion, he informed the employees that the company had no intention of removing award entitlements. His evidence is that this had not previously been discussed with the employees.
[43] Mr Jones’ evidence is that he felt that Mr Paff’s presentation was not in keeping with the spirit of their arrangement that addresses to the employees should be brief. Mr Jones also gave evidence that, other than this presentation, the company had not held any meetings or briefings for employees to explain the agreement. During cross-examination Mr Paff rejected the suggestion that the only explanation of the agreement and its effect occurred on the day of the vote.
[44] Mr Paff’s evidence is that the ballot papers were handed out to employees while they were seated in rows. He gave out papers to the front two rows and one of the delegates gave out the rest. Mr Paff’s evidence is that he stood and watched the papers being passed along the rows to ensure that each employee had a ballot paper. He relied upon the delegate to do the same with the other rows. He rejected a suggestion that he could not know how many votes were cast by each employee.
[45] Mr Jones’ evidence is that there was no method of keeping track of how many ballot papers were handed out as they were passed out in bundles. Further, there was no way of telling who had voted and how many times they had voted. His evidence is that he and one of the other delegates each counted the employees as they placed their ballot papers in the ballot box. Both counted 70 at the day shift meeting and 26 at the afternoon shift meeting. Mr Jones’ evidence is that these numbers were tallied prior to the count of the vote.
[46] The count was conducted following the conclusion of the second meeting. There were 105 ballot papers. There were no invalid votes, 53 yes votes and 52 no votes. Because of the closeness of the result there were two recounts. The ballot box was opened up to ensure that no ballot paper was caught inside.
[47] Mr Paff’s evidence is that he asked the delegates “are we happy with the decision” to which Mr Jones replied that it looked like the employees had made up their minds. Mr Jones stated that he would inform Mr Lewin of the result. Mr Paff’s evidence is that he then asked what the delegates wanted to do with the ballot papers. One of the delegates responded that he would dispose of them. The papers and the ballot box were then placed in the recycling bin.
[48] Mr Paff’s evidence is that 121 employees who would be covered by the proposed agreement attended work that day. Seventeen employees had submitted leave applications and were not present, Annexure L to Exhibit United 1.
[49] Mr Jones’ evidence is that, as far as he was aware, all employees who were present at work that day voted. He noted that it was difficult to monitor if all had voted and whether they had voted more than once.
[50] During cross-examination Mr Jones acknowledged that the union’s concerns about the ballot process had not been raised with the company until statements were filed in these proceedings.
[51] Around 25 August Mr Jones’ work location was moved to a different shed. His evidence is that one of the supervisors told him that this had been done to split him up from one of the other delegates. His evidence is that there had been a considerable change in company policy and practice concerning the union since bargaining stopped. Mr Paff’s evidence is that Mr Jones’ work location had been changed for operational reasons. He understood that there had since been a further move.
[52] On 27 August the AMWU sent a letter to this Tribunal setting out its concerns about the bargaining and ballot process and the contents of the agreement. The application for approval was lodged on 1 September 2009.
AMWU SUBMISSIONS
[53] The AMWU opposes approval of the agreement on five grounds. These are: the failure of the company to comply with section 173 regarding the notice of employee representational rights; its failure to comply with section 180 in relation to both the provision of the agreement and the explanation of its terms and effect; the absence of genuine agreement by the employees as required by sections 186 and 188; the failure of the company to comply with its good faith bargaining obligations under section 228; and, the failure of the agreement to pass the no disadvantage test.
[54] In relation to the first ground Mr Kennedy submitted that the notice of employee representational rights is a very important, technical document. He noted that the evidence of Mr Jones was that he could not remember seeing the document and did not know what it meant.
[55] Mr Kennedy submitted that placing the notice on the noticeboards was not appropriate especially in the absence of any meeting with employees to draw it to their attention and explain its contents. He submitted that there was nothing special about this workplace which precluded the company from providing a copy of the notice to each employee.
[56] Mr Kennedy submitted that the noticeboards at the site are not in a readily accessible and conspicuous location as required by Regulation 2.4 of the Fair Work Regulations 2009 (the Regulations). He submitted that the evidence was that many employees would not look at the noticeboard.
[57] In relation to the second ground of objection Mr Kennedy submitted that the company had not provided a copy of the agreement to each employee nor had it provided reasonable access to it. One copy on each of six noticeboards for almost 140 employees was not sufficient, particularly when employees had not been informed that the document was there. Mr Kennedy submitted that the later provision of the bulk agreements in the meal rooms did not remedy the situation. Further, the company did not provide the employees with copies of, or access to, the award which is partly incorporated by reference into the agreement.
[58] Mr Kennedy submitted that the company had failed to take reasonable steps to explain to employees the terms of the agreement and their effect. He submitted that the communication meetings were brief and the issue of the application of the award was only discussed on the day of the ballot.
[59] Mr Kennedy submitted that an additional failure to explain the terms of the agreement and their effect arose from Mr Paff’s statements about the award application issue which had misled employees. He submitted that it would be reasonable to assume that employees were confused about the question.
[60] In relation to the third ground of objection, absence of genuine agreement, Mr Kennedy referred to the provisions of both section 186(2)(a) and 188. He relied upon the earlier grounds of objection as establishing the company’s failure to take the pre-approval steps as required. In addition Mr Kennedy submitted that the ballot process itself was flawed in two respects.
[61] First, a number of employees had been denied the opportunity to vote because there was no provision for absentee voting. Secondly, there were no procedures in place to ensure that each employee voted only once. Mr Kennedy referred to the evidence of Mr Jones about the discrepancy between his head count and the number of votes cast. He submitted that, because of the flaws in the process and the closeness in the outcome of the ballot, it could not be said that there had been genuine agreement.
[62] Mr Kennedy submitted that the company had failed to meet its obligations concerning good faith bargaining under section 228. He submitted that the company had misled employees about the award application issue and this amounted to capricious or unfair conduct undermining collective bargaining. Further, the company had not responded to the union’s proposals in a timely fashion nor had it given genuine consideration to those proposals. Mr Kennedy also submitted that the sudden decision to stop bargaining and start the approval process was indicative of bad faith bargaining.
[63] Mr Kennedy submitted that, absent the undertaking in Exhibit United 1, the agreement did not pass the no disadvantage test. Clause 5 of the agreement cuts out award conditions with a few exceptions. Mr Kennedy submitted that this meant employees would lose their entitlement to a number of important conditions such as penalty rates, breaks, hours, rosters and leave loading.
[64] Mr Kennedy also raised concerns about calculations which had been provided by the company, Exhibit United 3, and noted that no account had been taken of the award conditions which had been lost. He also questioned the currency of the starting point rates relied upon in the calculations.
UNITED SUBMISSIONS
[65] Mr Gee submitted that the company had done all that was required of it in relation to the provision of the notice of employee representative rights. The evidence of Mr Paff was that it was custom and practice at the site to communicate with employees about issues of this sort by way of notices placed on the noticeboards. Mr Gee noted that the union itself utilised the noticeboards to communicate with members. Further, Mr Gee submitted that Mr Paff’s unchallenged evidence was that he had explained the contents of the notice at the communication meeting on 30 July.
[66] Mr Gee noted that the notice had been placed on six noticeboards and that there was no suggestion that they were not in conspicuous locations. He submitted that I could accept that the noticeboards were readily accessible to employees. Mr Gee noted that, in any event, Regulation 2.4 does not prevent an employer from using a different method of providing the notice to employees.
[67] Mr Gee submitted that the notice could not have been provided at an earlier time and certainly not before 1 July. In this regard he referred to the decision of Whelan C in the matter of Alphington Aged Care [2009] FWA 301.
[68] In response to the second ground of objection, access to and explanation of the proposed agreement, Mr Gee noted that section 180(2) provided for alternatives; that employees be given a copy of or have access to the material. Mr Gee submitted that, again, custom and practice at the site demonstrated that it was reasonable to provide access to copies of the agreement by way of the noticeboards. Mr Gee also referred to the provision of the 60 additional copies of the document and the notice to employees that extra copies were available from reception as further evidence that the company had taken all reasonable steps as required by the legislation.
[69] Mr Gee submitted that I could be satisfied that reasonable steps had been taken to provide access to the award. In this regard he referred to and relied upon Mr Paff’s evidence that the instrument was available in the administration building.
[70] Mr Gee noted that, in contrast to section 180(2), section 180(5) does not require that the explanation of the terms and effect of a proposed agreement be provided at any particular time. He referred to Mr Paff’s evidence that he had given employees a detailed explanation on 20 August including an opportunity to ask questions. In addition, the evidence showed that there were other occasions on which explanations had been provided about specific terms. Mr Gee noted that it had not been suggested that there were groups of employees for whom special arrangements should have been made as provided for in section 180(5)(b) and (6).
[71] Mr Gee submitted that little, if any, weight should be given to the union’s third ground of objection. He noted that the concerns about the ballot process had not been raised on the day of the vote itself and indeed had not been put forward until the week prior to the hearing when witness statements had been provided. Mr Gee submitted that this complete absence of concern tended to undermine the union’s contention that it was a real issue.
[72] Further, Mr Gee noted the evidence that the ballot process had been designed with the agreement of the delegates and had been supervised by them. He also noted that there had been two recounts and referred to the exchange between Mr Paff and the delegates concerning the apparent acceptance of the result and disposal of the papers. Mr Gee submitted that this evidence did not suggest that there was any issue with the conduct or count of the ballot.
[73] Mr Gee submitted that the good faith bargaining obligations in section 228 do not arise in relation to an approval process. He submitted that, in any event, the evidence of Mr Paff showed that the company had not failed to attend or participate in meetings, disclose relevant information in a timely fashion, respond to proposals or give genuine consideration to proposals.
[74] Mr Gee submitted that there was no evidence that the company had engaged in capricious or unfair conduct which would undermine freedom of association. The company had bargained with the only bargaining representative involved in the process. Mr Lewin had been given access to members and the company had facilitated changes to meeting times to suit his availability.
[75] Mr Gee noted that section 228(2) does not require a bargaining party to make concessions. The fact that the company rejected the claim for a personal leave incentive scheme did not mean it had been bargaining in bad faith. Mr Gee also noted that, despite the resolution of the mass meeting that the union take action against the company for breach of its good faith bargaining obligations, no such step had been taken.
[76] Mr Gee noted the company’s position that the undertaking in Exhibit United 2 be considered as part of the no disadvantage test rather than as an alternative. He acknowledged that the calculations in Exhibit United 3 only went to ordinary hours of work. Mr Gee submitted that the agreement passed the no disadvantage test as far as ordinary hours were concerned. He also noted that, despite the AMWU’s submission, not all of the award is excluded from the agreement. Clause 5 specifically includes certain conditions and the agreement also refers to other parts of the award which itself continues.
[77] Mr Gee submitted that any doubts about whether the no disadvantage test was met should be offset by the fact that the undertaking will become a term of the agreement by virtue of the operation of section 191. Mr Gee noted Mr Paff’s evidence that the company had not intended to deprive employees of the benefits of the award and submitted that the undertaking reflected that intention.
CONCLUSIONS
[78] Section 186 of the Act provides that, if an application for the approval of an enterprise agreement is made, FWA must approve it if various requirements in both that section and section 187 are met. In this case the AMWU has put into question whether certain pre-approval steps have been taken, whether there has been genuine approval of the agreement and whether it passes the no disadvantage test. It also raises issues about good faith bargaining.
[79] In view of the approach of the parties and the manner in which proceedings developed, it is convenient if I address the objections raised by the union. It should be noted however that the legislation also requires satisfaction of a number of other matters before approval of an agreement can be given.
[80] The first issue raised by the AMWU is whether the company has failed to comply with the requirements of section 173. Section 173(1) provides that an employer “must take all reasonable steps to give notice of the right to be represented by a bargaining representative to each employee”. Subsection (5) provides that the Regulations may prescribe how such notices may be given. Regulation 2.04 prescribes that notices may be given personally, by pre-paid post, by email, by fax, or by displaying the notice “in a conspicuous location at the workplace that is known by and readily accessible to the employee”. Sub-regulation (8) provides that the previous sub-regulations do not prevent an employer using another manner of giving notice.
[81] Clearly what could be considered to be reasonable steps under section 173(1) depends upon the circumstances. What might be considered to be reasonable steps in one situation may not in another. In this case the company gave the relevant notice to employees by placing a copy on each of six noticeboards at the workplace. I accept that this was reasonable in the circumstances. The evidence showed that the noticeboards were regularly used for communication purposes at the site both by the company and the union.
[82] I accept Mr Jones’ evidence that not all employees look at the noticeboards. I am satisfied however that the evidence establishes that the boards were in conspicuous locations and readily accessible to employees.
[83] An additional point to note, although not directly relevant to this issue of compliance with section 173, is that, in this matter, the company was already bargaining with the AMWU. There was no suggestion that any employee sought or wished to be represented by anyone other than the union.
[84] I am satisfied that the requirements of section 173(1) have been met.
[85] The second issue to be considered is whether the company has met its obligations under section 180 both in relation to the provision of the agreement and the explanation of its terms and effect.
[86] Section 180(2) provides that an employer must take all reasonable steps to ensure that employees are given a copy of the written text of the agreement and any other material incorporated by reference in the agreement or access to a copy of those materials. This must be available during the “access period” which subsection (4) defines as the seven day period ending immediately before the start of the voting process.
[87] It is not suggested that employees were given copies of the agreement and the award, or relevant parts of it. The question is whether the company took all reasonable steps to provide access to such material. The evidence is that, on 10 August, a copy of the agreement was distributed at each of the six noticeboards and a copy given to each delegate. A further 60 copies were made available in the lunch rooms on 13 August.
[88] It would have been preferable, in my view, that more copies of the agreement had been made available to employees at the earlier date. However, taken as a whole, I am satisfied that the company took reasonable steps to provide access to the agreement.
[89] The situation in relation to access to the award is more problematic. I accept Mr Paff’s evidence that the award was freely available to employees from the administration building and that copies had been provided to members of the consultative committee. However, I am not satisfied that such availability discharges the company’s obligation under section 180(2). For instance, there was no evidence to suggest that employees had been reminded of the availability of the award in any of the notices provided to them as they had been in relation to the agreement, for example, in the notice at Annexure H to Exhibit United 1.
[90] It may be that in some situations the degree of access to the award which was provided here may be sufficient. For example, if the interaction between the agreement and the award, or relevant parts of it, was identical to the previous agreement or agreements which covered the employees. However, in this case there was a real issue about the extent to which parts of the award had been incorporated into the agreement and the degree of interaction between the two documents. In such circumstances I consider that the company was required to do more to provide access to the award, or more particularly, to those parts which were incorporated by reference in the agreement. It did not take all reasonable steps in that regard.
[91] I am satisfied that the company has met its obligations under section 180(2) in relation to access to the agreement but not in relation to access to the other material incorporated by reference.
[92] The next issue concerns whether the company has met its obligations under section 180(5). That provides that an employer must take all reasonable steps to ensure that the terms of an agreement and the effect of those terms are explained to employees.
[93] I am satisfied that the cumulative effect of the various communication meetings, EBA update notices and Mr Paff’s presentation on 20 August meets the requirements of section 180(5). I note however that it might have been preferable if the lengthy presentation on 20 August had been provided a few days earlier in order that employees could consider what had been said without the need to cast a vote that same day.
[94] The next issue is whether employees genuinely agreed to the agreement. Section 186(2) requires FWA to be satisfied that the agreement has been genuinely agreed to by the employees covered by it. Section 188 is also relevant. It provides that an agreement has been genuinely agreed to if FWA is satisfied that: the employer has complied with subsections 180(2), (3) and 5 and subsection 181(2); the agreement was made in accordance with, in this case, section 182(1); and, there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees.
[95] Section 182(1) provides that an agreement is made when a majority of those employees who cast a valid vote approve the agreement.
[96] I have already indicated that I am satisfied that the company has complied with section 180(5). There is no suggestion that it has not met the requirements of section 180(3) or section 181(2) and I am satisfied that it has complied with both. However, as previously stated, I am not satisfied that the company has complied with section 180(2) in respect of access to the award.
[97] There is also a real question as to whether the provisions of section 182(1) have been met and whether there are other grounds for believing that the agreement was not genuinely agreed to. These concerns arise from the voting process. The Act does not prescribe the manner in which the process is to be conducted other than that it is to be by vote, section 181(1). Section 181(3) provides that, without limiting subsection (1), the vote may be by ballot or by an electronic method.
[98] As indicated earlier, the vote in this case was by the narrowest of margins; 53 yes votes and 52 no votes. That in itself is not a problem. However, when considered in conjunction with the lack of control of the ballot papers and the discrepancy between the number of ballot papers and the delegates’ head count, I cannot be satisfied that the legislative requirements have been met. This is further compounded by the lack of any facility for those employees who were on approved leave to cast a vote.
[99] Although I can understand the company’s frustration that issues concerning the ballot had not been raised by the union at an earlier time, nevertheless the Act requires that FWA be satisfied that there has been genuine agreement. In this case I am not so satisfied.
[100] Because of the conclusion I have reached on this issue there is no need for me to address the remaining two grounds of the AMWU’s objection.
[101] For the reasons set out above I am not satisfied that the requirements for approval of this agreement have been met. Consequently, I am unable to approve it. The application is dismissed.
COMMISSIONER
Appearances:
Mr B. Gee, solicitor, with P Styles for United Group Rail Services Limited
Mr J. Kennedy of the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union
Hearing details:
Sydney.
2009.
September 21.
Printed by authority of the Commonwealth Government Printer
<Price code C, PR989596>
4