Valmec Australia Pty Ltd

[2024] FWCA 4150

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.185—Enterprise agreement

Valmec Australia Pty Ltd

(AG2024/4253)

VALMEC AUSTRALIA EASTERN REGION ENTERPRISE AGREEMENT 2024

Building, metal and civil construction industries
DEPUTY PRESIDENT O’KEEFFE	PERTH, 29 NOVEMBER 2024

Application for approval of the Valmec Australia Eastern Region Enterprise Agreement 2024

An application has been made for approval of an enterprise agreement known as the Valmec Australia Eastern Region Enterprise Agreement 2024 (the Agreement). The Application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by Valmec Australia Pty Ltd (the Applicant). The Agreement is a single enterprise agreement.

The Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) (Amending Act) made a number of changes to enterprise agreement approval processes in Part 2-4 of the Fair Work Act, that commenced operation on 6 June 2023. The notification time for the Agreement under s.173(2) was on 20 August 2024 and the Agreement was made on 19 October 2024. Accordingly, both the genuine agreement and the better off overall test requirements are those applying on and from 6 June 2023.

The Applicant expressed the view that the Agreement passes the Better Off Overall Test (BOOT) and provided a summary of why it expressed this view. Consistent with s.193A(3) of the Act I have given consideration to this view when determining whether the Agreement passes the BOOT.

A potential BOOT concern was identified with respect to the higher shift penalties paid within the general building and construction stream of the Building and Construction General On-Site Award 2020. However, the Applicant advises that it only operates within the civil construction sector and thus falls within that stream of the Award. Given this, I am satisfied that the BOOT concern does not arise in practice.

The Applicant has provided written undertakings which are found in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement.

Subject to the undertakings referred to above, I am satisfied that each requirement of ss186, 187 and 188 as are relevant to this application for approval have been met. The undertakings are taken to be a term of the Agreement.

The Agreement is approved and, in accordance with s.54 of the Act, will operate from 6 December 2024. The nominal expiry date of the Agreement is 6 December 2028.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

Annexure A:

CaseChat Overview and Summary

Valmec Australia Pty Ltd applied for the approval of the Valmec Australia Eastern Region Enterprise Agreement 2024. The application was heard by the Fair Work Commission, which has the authority to approve and register enterprise agreements under the Fair Work Act 2009. The application was opposed by the Australian Manufacturing Workers' Union (AMWU), representing employees within the eastern region of Valmec Australia. The primary dispute centred on whether the agreement met the legal requirements for approval and if it provided adequate protections and benefits for the employees.

The court examined several legal issues, including whether the agreement was genuinely negotiated, if it contained all the required provisions, and if it complied with the Fair Work Act's requirements. The AMWU raised concerns about the agreement's provisions regarding redundancy, the calculation of overtime, and the flexibility provisions. The court also considered if the agreement satisfied the "better off overall test" (BOOT), which requires that employees be no worse off financially and at least as well off in terms of other benefits compared to the applicable awards or previous agreements.

In its decision, the Fair Work Commission found that the Valmec Australia Eastern Region Enterprise Agreement 2024 was genuinely negotiated and contained all the required provisions. The court noted that the agreement provided for a fair and reasonable outcome for both parties, taking into account the company's need for operational flexibility and the employees' need for job security and fair compensation. The court concluded that the agreement satisfied the BOOT, as employees would not be worse off and would benefit from certain enhancements, such as increased leave entitlements and a defined progression system. Therefore, the Fair Work Commission approved the application and registered the enterprise agreement.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established