Wigley Engineering Pty Ltd
[2012] FWA 4479
•24 MAY 2012
[2012] FWA 4479 |
|
DECISION |
Fair Work Act 2009
s.185—Enterprise agreement
Wigley Engineering Pty Ltd
(AG2012/1418)
COMMISSIONER GOOLEY | MELBOURNE, 24 MAY 2012 |
Wigley Engineering Pty Ltd Enterprise Agreement 2012.
[1] Wigley Engineering Pty Ltd (the Applicant) lodged an application for approval of the Wigley Engineering Enterprise Agreement 2012 (the Agreement) on 30 April 2012.
[2] On 3 May 2012 I wrote to the Applicant advising that the notice of employee representational rights did not comply with the Fair Work Act 2009 (the FW Act) in that it did not advise persons who were members of a union of their right to be represented by their union. I also advised that as the Agreement contained no rates of pay, I was unable to conclude that all employees would be better off under the Agreement than if the relevant modern awards applied to the employees.
[3] The notice of employee representational rights issued to employees was in the following terms:
“Wigley Engineering Pty Ltd gives notice that it is bargaining in relation to an enterprise agreement (Wigley Engineering Pty Ltd Enterprise Agreement 2012)which is proposed to cover all employees engaged at the company’s workplace at 16 Zenith Road, Dandenong, Vic, 3175 except the managing Director.
What is an enterprise agreement?
An enterprise agreement is an agreement between an employer and its employees that will be covered by the agreement that sets the wages and conditions of those employees for a period of up to 4 years. To come into operation, the agreement must be supported by a majority of the employees who cast a vote to approve the agreement and it must be approved by an independent authority, Fair Work Australia.
If you are an employee who would be covered by the proposed agreement:
You have the right to appoint a bargaining representative to represent you in bargaining for the agreement or in a matter before Fair Work Australia about bargaining for the agreement.
You can do this by notifying the person in writing that you appoint that person as your bargaining representative. You can also appoint yourself as a bargaining representative. In either case you must give a copy of the appointment to your employer.
Questions?
If you have any questions about this notice or about enterprise bargaining, please speak to either your employer, bargaining representative, go to or contact the Fair Work Australia Help Line on 1300 799 675.”
[4] The notice omitted the following:
“If you are an employee who would be covered by the proposed agreement:
If you are a member of a union that is entitled to represent your industrial interests in relation to the work to be performed under the agreement, your union will be your bargaining representative for the agreement unless you appoint another person as your representative or you revoke the union’s status as your representative.” 1
[5] The application was listed for hearing on 15 May 2012.
The Applicant’s submissions
[6] The Applicant acknowledged the omission from the notice of employee representational rights. However the Applicant submitted that the notice still told employees that they could appoint a bargaining representative. The Applicant submitted that it did not know if any of its employees were union members but that all the employees (bar two) 2 who were covered by the Agreement had signed a document which said as follows:
“I am currently an employee of Wigley Engineering Pty Ltd (the company). I participated in the vote on 18 April 2012 to approve the Wigley Engineering Pty Ltd Enterprise Agreement 2012 (the Agreement).
I was given a copy of a Notice of Employee Representational Rights on 14 March 2012. During the negotiations, Matthew Palmer and Petrus Van der Werff represented employees (including me) and negotiated the Agreement with the Company on my behalf. I was happy for Matthew and Petrus to represent me in the negotiations. I did not want to appoint a union as my bargaining representative.
I have made this statement voluntarily without any pressure or coercion from the company to do so.”
[7] The Applicant’s statutory declaration did not identify Mr Palmer or Mr Van der Werff as employee bargaining representatives.
[8] The Applicant submitted that “the omission in question [did] not affect the legislative entitlement of employees to appoint a bargaining representative.” 3 Further, the Applicant submitted that the “legislature did not intend a notice of employee representational rights to be rendered invalid because of an omission of the type made in this case.”4 The Applicant relied on the decision of the Full Bench in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Inghams Enterprises Pty Ltd (Inghams).5
[9] In response to my question about rates of pay the Applicant submitted that each individual employee was aware of their own rates of pay and new employees would be advised of their rate of pay upon commencement. The Applicant provided information on the current rates of pay. I further advised the Applicant that I was concerned that as the rates provided were not in the Agreement they were not enforceable and I asked if the Applicant would provide an undertaking that the rates provided to the Tribunal were the rates to be paid. The Applicant asked if an undertaking were given to that effect could the rates be retained on the file and not published with the Agreement.
[10] I subsequently asked the Applicant if the employees were aware of the rates when they approved the Agreement.
[11] The Applicant then proposed an undertaking that employees will be paid no less than 105% of the relevant award rate of pay for their classification at the relevant time.
[12] Section 174 of the FW Act provides as follows:
“174 Content of notice of employee representational rights
Application of this section
(1) This section applies if an employer that will be covered by a proposed enterprise agreement is required to give a notice under subsection 173(1) to an employee.
Content of notice—employee may appoint a bargaining representative
(2) The notice must specify that the employee may appoint a bargaining representative to represent the employee:
(a) in bargaining for the agreement; and
(b) in a matter before FWA that relates to bargaining for the agreement.
Content of notice—default bargaining representative
(3) If subsection (4) does not apply, the notice must explain that:
(a) if the employee is a member of an employee organisation that is entitled to represent the industrial interests of the employee in relation to work that will be performed under the agreement; and
(b) the employee does not appoint another person as his or her bargaining representative for the agreement;
the organisation will be the bargaining representative of the employee.
Content of notice—bargaining representative if a low-paid authorisation is in operation
(4) If a low-paid authorisation in relation to the agreement that specifies the employer is in operation, the notice must explain the effect of paragraph 176(1)(b) and subsection 176(2) (which deal with bargaining representatives for such agreements).
Content of notice—copy of instrument of appointment to be given
(5) The notice must explain the effect of paragraph 178(2)(a) (which deals with giving a copy of an instrument of appointment of a bargaining representative to an employee’s employer).
Regulations may prescribe additional content and form requirements etc.
(6) The regulations may prescribe other matters relating to the content or form of the notice, or the manner in which employers may give the notice to employees.”
[13] Section 186 of the FW Act relevantly provides as follows:
“186 When FWA must approve an enterprise agreement—general requirements
Basic rule
(1) If an application for the approval of an enterprise agreement is made under section 185, FWA must approve the agreement under this section if the requirements set out in this section and section 187 are met.
Note: FWA may approve an enterprise agreement under this section with undertakings (see section 190).
Requirements relating to the safety net etc.
(2) FWA must be satisfied that:
(a) if the agreement is not a greenfields agreement—the agreement has been genuinely agreed to by the employees covered by the agreement; and
(b) if the agreement is a multi-enterprise agreement:
(i) the agreement has been genuinely agreed to by each employer covered by the agreement; and
(ii) no person coerced, or threatened to coerce, any of the employers to make the agreement; and
(c) the terms of the agreement do not contravene section 55 (which deals with the interaction between the National Employment Standards and enterprise agreements etc.); and
(d) the agreement passes the better off overall test.”
[14] Section 188 of the FW Act provides as follows:
“188 When employees have genuinely agreed to an enterprise agreement
An enterprise agreement has been genuinely agreed to by the employees covered by the agreement if FWA is satisfied that:
(a) the employer, or each of the employers, covered by the agreement complied with the following provisions in relation to the agreement:
(i) subsections 180(2), (3) and (5) (which deal with pre-approval steps);
(ii) subsection 181(2) (which requires that employees not be requested to approve an enterprise agreement until 21 days after the last notice of employee representational rights is given); and
(b) the agreement was made in accordance with whichever of subsection 182(1) or (2) applies (those subsections deal with the making of different kinds of enterprise agreements by employee vote); and
(c) there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees.”
[15] In Galintel Rollings Mill Pty Ltd t/a the Graham Group (Galintel) the Full Bench determined that the requirement in section 181(2) “cannot be satisfied if a notice referred to in s173 is not given.” 6 Further the Full Bench held that “if an employer fails to advise employees of their rights in the manner specified the requirement is not satisfied.”7 In this case the notice was consistent with the requirements of the Act but added a nomination form to the end of the notice. While the Full Bench considered it unwise for an employer to modify or add terms to the notice of representational rights, it held that unless the alteration altered the nature of the notice it will not invalidate the notice.
[16] The omission in the notice provided to employees in this matter is significantly different from that considered by the Full Bench in Galintel and Inghams 8. In Inghams the notice omitted the provisions relating to employees covered by an Australian Workplace Agreement (AWA), individual transitional employment agreement (ITEA) or a preserved individual State agreement.
[17] The Full Bench held that “the failure to include the qualification to that right set out in item 2(3) of Schedule 13 of the TPCA Act and the additional paragraph in Schedule 2.1 of the FW Regulations merely means the employee is not notified through the notice that their right to appoint a bargaining representative or for a person to become their bargaining representative is qualified.” 9
[18] The omission in the notice of representational rights of the provision that advises employees who are members of a union that their union is their default bargaining representative is by contrast a significant omission.
[19] I am not satisfied that the views of the employees as articulated in the documents filed with the Tribunal overcomes the effect of the omission. That employees have advised the Tribunal, after the agreement was negotiated, that they did not want to appoint their union as their bargaining representative, does not overcome the fact that they did not know when bargaining commenced that their union was entitled to be their default bargaining representative.
[20] I accept that the employees could have contacted their union and it could have represented them but they did not know this. However had they appointed the union as their bargaining representative the notice provided by the Applicant told them they must notify the Applicant of that appointment in writing. There are many reasons why an employee may not wish to do this including his or her desire to keep his or her union membership private. The FW Act protects that anonymity by providing that the union does not have to be appointed in writing and the employee is not required to provide written notice to his or her employer that the union is his or her bargaining representative. These employees were denied this important information.
[21] I consider that the omission invalidates the notice of employee representational rights.
[22] I therefore dismiss the application for approval of the Agreement.
[23] As I have determined to dismiss the application for approval as the Applicant did not comply with section 181(2) it is not strictly necessary to consider the omission of rates of pay from the Agreement.
[24] To assist the Applicant it is appropriate that I advise them of my preliminary views on this. The rates payable under the Agreement are the rates from the relevant modern awards which were incorporated into the Agreement. Given the improvements in the Agreement do not apply to all employees I consider that the Agreement did not meet the better off over all test.
[25] While the undertaking would have overcome that concern I am not convinced that the undertaking would not have substantially changed the Agreement. It is not clear that employees understood that new employees could be paid substantially lower rates of pay than they were receiving.
[26] I would have accepted an undertaking that the rates of pay provided to the Tribunal on 10 May 2012 were rates of pay for the purpose of clause 5 of the Agreement and that those rates would remain confidential provided a copy of the rates were provided to new employees on commencement of employment.
COMMISSIONER
1 Notice of Representational Rights schedule 2.1 to the Fair Work Regulations 2009
2 One employee had left the employment of the employer and the other employee was absent on personal leave
3 Submission of the Respondent 15 May 2012
4 Ibid
5 [2011] FWAFB 6106
6 [2011] FWAFB 6772 at [38]
7 Ibid at [40]
8 [2011] FWAFB 6106
9 Ibid at [51]
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