W Hub Pty Ltd - [2022] FWC 985

[2022] FWC 985

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.318 - Application for an order relating to instruments covering new employer and transferring employees
s.319 – Application for an order relating to instruments covering new employer and non-transferring employees

W Hub Pty Ltd

(AG2022/1233)

Mining industry
DEPUTY PRESIDENT BEAUMONT	PERTH, 18 MAY 2022

Application for an order relating to instruments covering new employer, transferring employees and non-transferring employees.

This decision concerns an application by W Hub Pty Ltd (W Hub) for orders under ss 318 and 319 of the Fair Work Act 2009 (Cth) (the Act).

The application is made in respect of the employment of 177 employees who are to commence employment with W Hub, having previously been employed by MACA Mining Pty Ltd (MACA).

Background

W Hub is a wholly owned subsidiary of Fortescue Metals Group Ltd (Fortescue). Fortescue owns a mine at Eliwana which is located in Fortescue’s Western Hub in the Pilbara region of Western Australia, approximately 90km northwest of Tom Price.

On or about 1 July 2020, Downer EDI Mining Pty Ltd (Downer) and Fortescue entered a contract for the provision of outsourced early mining and maintenance services.

On or about 1 February 2021, MACA took over providing the services from Downer on the same contract terms. The MACA employees are covered by the Downer EDI Mining Surface Mining Enterprise Agreement 2016 (Downer Agreement).[1]

The arrangement that Fortescue now contemplates is a transition of the mining services from an outsourced model (MACA) to direct engagement by W Hub.

By mutual agreement, MACA and Fortescue are said to have reviewed and developed a sustainable business model for the provision of mining operators and drill/blast operators to the Eliwana mine site. This of course includes a transition from an outsourced arrangement to a direct employment model.

According to W Hub, within seven days of the Commission making the orders sought under ss 318 and 319, it will directly employ 177 MACA mining operators and drill/blast operators who currently perform work at the Eliwana mine site (Transferring Employees).

As observed, the Transferring Employees are currently covered by the Downer Agreement, whereas W Hub’s employees are covered by the W Hub Pty Ltd Enterprise Agreement 2020 (W Hub Agreement).[2]

At this juncture, it is relevant to note that I am satisfied the Downer Agreement is a Transferrable Instrument for the purposes of s 312 of the Act, because it is an enterprise agreement that has been approved by the Commission.[3]

The early mining and maintenance services performed by MACA mining operators and MACA driller/blast operators constitutes ‘transferring work’ for the purposes of s 311(1)(c) of the Act because the work they will perform for W Hub is the same as the work the Transferring Employees currently perform for MACA (Transferring Work).

The circumstances are such that they give rise to a transfer of business as understood in s 311(1) of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2022] FWC 985
Decision Date: 18 MAY 2022

CaseChat Overview and Summary

W Hub Pty Ltd applied to the Fair Work Commission (FWC) for orders to alter the application of existing enterprise agreements in the context of a business transfer. The application concerned the employment of 177 employees who were to transfer from MACA Mining Pty Ltd to W Hub. The employees were covered by the Downer EDI Mining Surface Mining Enterprise Agreement 2016 (Downer Agreement), while W Hub employees were covered by the W Hub Pty Ltd Enterprise Agreement 2020 (W Hub Agreement). W Hub sought orders to prevent the Downer Agreement from covering it and the transferring employees, and to have the W Hub Agreement cover the transferring employees instead. It also sought to prevent the Downer Agreement from covering any new non-transferring employees. The key legal issues were whether the orders were appropriate under sections 318 and 319 of the Fair Work Act 2009, and if so, whether the factors weighed in favour of making the orders. The Deputy President found that the orders were appropriate and should be granted. The views of W Hub and the transferring employees favoured the orders. The transferring employees would not be disadvantaged overall by the change in agreements. The W Hub Agreement had a longer nominal expiry date, which would provide stability. The Downer Agreement would negatively impact productivity and cause economic disadvantage to W Hub. There was little business synergy between the agreements. Overall, the public interest favoured making the orders to facilitate the maintenance of employment for the transferring employees.

The Deputy President exercised their discretion to make the orders sought by W Hub. The orders will prevent the Downer Agreement from covering W Hub and the transferring employees, and will have the W Hub Agreement cover the transferring employees instead. The orders will also prevent the Downer Agreement from covering any new non-transferring employees. The orders will operate in accordance with sections 318(4) and 319(4) of the Fair Work Act.

Orders