[2013] FWC 912

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Fair Work Act 2009
s.185 - Application for approval of a greenfields agreement

Construction, Forestry, Mining and Energy Union



Summary: objection on basis of coverage - undertaking about coverage restriction - implication of coverage clause for contractors clause - security of employment - relational nexus - permitted matters - s.253(1) - s.356.

[1] On 10 December 2012, an application was made by the Construction, Forestry, Mining and Energy Union (“the CFMEU”) for the approval of the Mirvac Hamilton Park South (Reedy Creek) Project Union Greenfields Agreement (“the Agreement”). The Agreement purports to apply to employees who are employed under the classifications set out at clause 12 thereof. This is a particularly wide set of classifications, which may extend beyond the coverage provided for under the rules of the CFMEU.

[2] On its face therefore, an issue arises, in the context of the application clause in the Agreement as to how the Fair Work Commission (“the Commission”) could be satisfied that the Agreement meets the requirements of s.187(5)(a) of the Fair Work Act 2009 (“the Act”).

[3] Section 187(5)(a) of the Act provides as follows:

[4] Notwithstanding this, I am satisfied that on the evidence that has now come before me that the Agreement, despite the terms of its application clause, in actuality meets the requirements of s.187(5)(a) of the Act. The following sets out how the requisite degree of satisfaction was achieved, and how other consequential issues must be dealt with for purposes of the approval process.

[5] On 17 December 2012 and 21 December 2012, the Australian Workers Union (“the AWU”) directed correspondence to the Commission stating that it objected to the approval of the Agreement on the basis that the Agreement was made with an employee organisation that could not represent the industrial interests of a majority of the employees who will be covered by the agreement.

[6] Before proceeding, it is best first of all to set out the application provisions of the agreement so that the AWU’s objection, as it was, can be better appreciated.

[7] Clause 3(a)(ii) of the Agreement states that the Agreement covers the CFMEU, the employer and the employees of the employer who will:

[8] Sub clause 12.3 of the Agreement, amongst other related matters, refers to the various classification groups within which the employees will work. There are five such classification groups. For the purposes of this decision there is no requirement to set out all of the classifications there set out, other than to note that there is an extensive array of classifications cited.

[9] The AWU contended that the majority of the occupations outlined in the agreement did not fall within the CFMEU’s general construction division rules. And further, the CFMEU general construction division’s rules in relation to civil or mechanical engineering projects restricted it to representing the industrial interests of carpenters and various plant.

[10] The AWU contended that the Commission could not be satisfied the requirements of the section were met given its above stated concerns.

[11] In response to the AWU’s concerns, Mr Cameron Kirkwood, the Project Manager, Development Queensland, for Mirvac provided a written statement, received on 23 January 2013, which included the following comments:

[12] Mr Kirkwood’s statement was underpinned by written submissions made by Mr Travis O'Brien, the CFMEU legal officer, that “Mirvac will only be employing a limited number of forklift drivers pursuant to the proposed enterprise agreement”, and that the Commission “can be satisfied of the eligibility for membership of workers who will be engaged under a proposed agreement based on the sworn statement is provided on behalf of the employer.”

[13] A conference was convened on 6 February 2013 at the request of the AWU to discuss the circumstances of the Agreement. Following that conference, I directed the following correspondence to the CFMEU and Mr Kirkwood:

[14] A statutory declaration was received by Mr Kirkwood to the same end as his statement as referred to above. That statutory declaration was received on 22 February 2013.

[15] Having received Mr Kirkwood’s statement, I am now satisfied that the requirements of s.187(5)(a) of the Act are now met for purposes of the approval process.

[16] Notwithstanding this, I make the following comments about clause 23 of the Agreement, the operation of which is affected by the constrained application of the Agreement as evidenced by Mr Kirkwood and as advanced by the CFMEU. The above correspondence as cited alludes to this concern on my part.

[17] Clause 23 of the Agreement is headed “Employment Security and Engagement of Sub-contractors and Labour Hire”, and provides as follows.

[18] Section172(1) of the Act provides as follows:

[19] In so far as clause 23 purports to operate in respect of any contractors or subcontractors engaged under classifications other than forklift driver (which is the only classification of employees to be employed under the Agreement), it would appear to me at least that the clause, arguably, would not comprise a permitted matter. This is because the clause would require the Company to extend to all contractors and subcontractors the terms and conditions under the Agreement in respect of classifications under which the Company does not employ any employees (other than forklift drivers).

[20] That is, in so far as it purports to operate beyond a classification of forklift driver, the clause may not concern the relationship between the employer that will be covered by the Agreement and its employees who will be covered by the Agreement.

[21] The evidence led is that the Company will not at any point in the future (given the application relates to a Greenfields agreement) employ any employees other than forklift drivers under the Agreement (notwithstanding sub clause 12.3 of the Agreement). No action taken under clause 23 other than in relation to those forklift drivers can therefore affect the job security of any employees under the Agreement. Indeed, the relationship of any persons (other than forklift drivers) engaged by the Company under the clause could not even be of an indirect, consequential or remote kind in relation to the Company’s employees (which, in any event, would be insufficient to make out the required relational nexus). I have previously made findings in this respect in relation to a prior matter with some similar facts. 1

[22] In all, other than in respect of forklift drivers, clause 23 may have no operation as a term of the Agreement because arguably it is not a permitted matter as it does not pertain to the relationship between an employer that will be covered by the Agreement and that employer’s employees who will be covered by the agreement.

[23] Notwithstanding, I have not pursued this issue to the point of making determinative findings as I might otherwise (for example, in respect of an issue arising for purposes of s.443 of the Act) as the Act does not ascribe to the existence of non-permitted terms any particular status for the approval process. Indeed the Explanatory Memorandum to the Act suggests the following is the intended effect of the Act:

[24] I have been mindful of not delaying the approval process by instigating processes that would delay the approval of the Agreement before me.

[25] I note too, that s.253 of the Act provides as follows:

[26] It follows that notwithstanding that whilst it is arguable that clause 23 of the agreement (other than in relation to persons engaged as forklift drivers) is not a term about a permitted matter (though the CFMEU begs to differ in its view), the inclusion of a term to that effect does not prevent the agreement from being an enterprise agreement. It further follows that the inclusion of the term does not invalidate the application nor cannot give the Commission reason to not approve the agreement, despite the term being of no effect. The Full Court of the Federal Court put it this way:

[27] The matter, then, may ultimately be one for the parties to consider themselves as a matter of legal risk, when and if the clauses are acted upon.

[28] The further consideration of this application for approval of a Greenfields agreement is dealt with by separate instrument.


 1   Construction, Forestry, Mining and Energy Union v Brookfield Multiplex Australasia Pty Ltd [2012] FWA 4579.

 2   Australian Industry Group v Fair Work Australia [2012] FCAFC 108 (14 August 2012) at [44].

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