| FWCA 2888|
|FAIR WORK COMMISSION|
Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement
Downer EDI Mining - Blasting Services Pty Ltd
DOWNER EDI MINING - BLASTING SERVICES NSW COAL ENTERPRISE AGREEMENT 2018
SYDNEY, 17 AUGUST 2018
Application for approval of the Downer EDI Mining - Blasting Services NSW Coal Enterprise Agreement 2018.
 On 22 February 2018 Downer EDI Mining - Blasting Services Pty Ltd (Downer Blasting/Applicant) made an application in the Fair Work Commission (Commission) for the approval of the Downer EDI Mining - Blasting Services NSW Coal Enterprise Agreement 2018 (Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (Cth) (FW Act). It was lodged within 14 days after it was made.
 The Agreement is a single-enterprise agreement. The parties to the Agreement Downer Blasting and, employees of Downer Blasting employed in the classifications prescribed in Clause 3.1 of the Agreement at coal mining operations in New South Wales who are involved blasting services. The Agreement, if approved, will apply to the exclusion of all awards and other agreements pursuant to the operation of clause 1.3.2. The nominal expiry date of the Agreement is expressed to be 4 years after the day on which the Agreement is approved by the Commission.
 The Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) objects to the approval of the Agreement on the basis that, it asserts, the Agreement does not meet the requirements for approval under the FW Act. On 6 July 2018 the CFMMEU particularised its objections. It contended that the Agreement should not be approved because:
a) the Applicant has not complied with the provisions of s 180 (2) of the FW Act and accordingly the Commission cannot be satisfied that the Agreement was genuinely agreed (s 186 (2) (a) and s 188 (a) (i));
b) the Commission cannot be satisfied that the Agreement passes the Better Off Overall Test (BOOT) (s 186 (2) (d));
c) the Agreement contravenes 55 of the FW Act;
d) the Agreement contains a term that is not a permitted matter (s 172). 1
 On 13 July 2018 Downer Blasting wrote to the Commission rebutting the issues raised by the CFMMEU. In its written submissions Downer Blasting contended that all the requirements of s180 (2), 180 (5), 186 (2) (a), s55 as well as the requirements of the BOOT had been met. 2
 On 18 July 2018 the CFMMEU responded to Downer Blastings’ submissions. It maintained that the Agreement should not be approved on the basis of non-compliance with the above mentioned requirements set out in the FW Act (except that the CFMMEU conceded that there had been compliance with s180(2) (i.e. provision of Agreement and incorporated material). 3
 Consequently the matter was programmed for a hearing on 26 July 2018. At the hearing:
a) Jarrett Goos appeared for the applicant. He also gave evidence on its behalf and was cross-examined. Mr Goos was honest in his testimony. He was candid with the Commission and made appropriate concessions when they were required. Mr Goos also called Michael Morris to give evidence. Mr Morris is employed by Downer Blasting as a Leading Hand. He was also a witness of credit.
b) Alex Bukarica appeared for the CFMMEU.
 In advance of the hearing the parties filed materials. In coming to this decision the Commission, as presently constituted, has had regard to all of the evidence received including submissions made at the hearing and the documents filed prior to the hearing (that were tendered as exhibits). Consequently, in coming to this decision the Commission, as presently constituted, has had regard to the following:
Form F16 – Application for approval of an enterprise agreement submitted by the applicant dated 22 February 2018
Form F17 – Employer’s statutory declaration in support of an application for approval of an enterprise agreement dated 22 February 2018
Correspondence from CFMMEU to the Commission dated 6 March 2018 indicating the request to be heard
Correspondence from Applicant to the Commission dated 6 March 2018
CFMMEU Outline of Submissions dated 6 July 2018
Applicant’s Outline of Submissions dated 13 July 2018
Statement of Jarrett Goos dated 13 July 2018
Statement of Michael Morris dated 13 July 2018
CFMMEU submissions in reply dated 19 July 2018
 For the reasons set out below I have decided not to approve the Agreement. This is because, having considered all of the evidence, I am not satisfied that Downer Blasting took all reasonable steps to provide an explanation to the relevant employees about the effect of the Agreement (s.180(5)). That is to say, because s.180(5) was not satisfied, I am not satisfied about s.188(a)(i) and, consequently, I am not satisfied that the Agreement was genuinely agreed to as required by s.186(2)(a). In deciding the same I make no statement of general principle. My decision is based solely on the particular circumstances of this case.
 Section 186(2)(a) provides as follows:
“(2) The FWC 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.”
 Section 188(a)(i) provides as follows:
“…An enterprise agreement has been genuinely agreed to by the employees covered by the agreement if the FWC 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).”
 Section 180(5) provides as follow:
“(5) The employer must take all reasonable steps to ensure that:
(a) the terms of the agreement, and the effect of those terms, are explained to the relevant employees; and
(b) the explanation is provided in an appropriate manner taking into account the particular circumstances and needs of the relevant employees.”
 It is worth setting out what, on behalf of Downer Blasting, Hilton Hurst declared in the F17 filed with the Application for approval.
a) Question 2.6: What steps were taken by the employer to explain the terms of the agreement, and the effect of those terms, to the relevant employees?
The proposed enterprise agreement was explained to employees during a meeting at site between on 8 February 2018. Employees were encouraged to ask questions during the meetings.
b) Question 2.7: When you explained the terms of the agreement to the employees, what did you do to take into account the particular circumstances and needs of the relevant employees?
There are no employees from non-English speaking backgrounds, young employees, or employees who weren't a bargaining representative covered by the proposed agreement.
c) Question 2.10: Please provide the following details about the vote on the agreement:
How many employees will be covered by the agreement? 4
How many employees cast a valid vote? 4
How many employees voted to approve the agreement? 4
d) Question 3.1: List the modern award(s), if any that currently cover the employer and any of the employees covered by this agreement.
Black Coal Mining Industry Award 2010
e) Question 3.4: Does the agreement contain any terms or conditions of employment that are more beneficial than equivalent terms and conditions in the reference instrument(s) listed in questions 3.1 and 3.2 and/or does the agreement confer any entitlements that are not conferred by those reference instruments?
f) Question 3.5: Does the agreement contain any terms or conditions of employment that are less beneficial than equivalent terms and conditions in the reference instrument(s) listed in questions 3.1 and 3.2 and/or does the agreement omit any entitlements that are conferred by those reference instruments?
 In its written submissions the CFMMEU submitted that the Commission cannot be satisfied that Downer Blasting took all reasonable steps to ensure that the terms of the agreement and the effect of those terms were explained to the relevant employees. The submissions detailed the following:
a) Based on the declaration made in the F17, the Applicant held one meeting with employees on 8 February 2018. This was 7 days after the agreement had been distributed and the day before the vote on the agreement occurred.
b) In the F17 Declaration and in response to the question about what the employer did to take into account the particular circumstances and needs of the relevant employees, the Applicant responded simply by informing the Commission that it does not have any employees in any of the categories in the examples given in the paragraph. This does not address the question being asked. The categories are indicative not exhaustive.
c) In the context of the issues going to the surrounding circumstances mentioned in Falcon Mining 4, it is reiterated that the Applicant is well resourced and experienced in agreement making and there were no logistical barriers or impediments to access to the employees.
d) All that the Commission has before it from the material filed by the Applicant is that it "explained" the Agreement. There is no detail of how the Applicant went about such an explanation. In that regard:
i. There was no explanation of contemporary reference award terms.
ii. There was no evidence of any negotiations.
iii. The Agreement is a comprehensive document comprising 54 clauses and incorporated material.
iv. There is no evidence of explanatory material distributed to employees.
v. There is no evidence that it identified let alone addressed any particular circumstances or needs.
 CFMMEU referred to the Full Bench Decision CFMEU v One Key Workforce Pty Ltd 5. In that decision, Flick J said the following with respect to the operation of s 180 (5):
"The requirement imposed by s 180 (5) to 'take all reasonable steps to ensure that ... the terms of the agreement, and the effect of those terms are explained' is an important obligation imposed on an employer to ensure that employees are as fully informed as practicable. The requirement is not a mere formality. Whatever steps may be necessary will depend on the facts and circumstances of each particular case; but those steps are not satisfied by a person reading- without explanation -the terms of an agreement to an employee."
 The CFMMEU noted that this reasoning was adopted by a Full Bench in CFMEU v Shamrock Civil Pty Ltd. 6
 The CFMMEU also drew my attention to the decision in Falcon Mining Pty Ltd 7, where Deputy President Asbury stated that, when addressing s 180 (5) consideration should take into account the context of the size of the employer, it resources, including available mechanisms and expertise, the role and qualifications of those who provide the explanation and the capacity and ability of the employees to receive such information.8
 The CFMMEU submitted that the number, extent and variation in the less beneficial terms, as identified in this submission, are such that the failure to identify any such less beneficial term in the F17 Declaration and give an explanation to employees, is a failure to comply with s 180 (5):
a) Firstly, in the F17 Declaration, the Applicant declares that there are no less beneficial terms in the Agreement by comparison with the reference award. The reference award is the Black Coal Mining Industry Award 2010 ('Award'). It is submitted that this is incorrect. This is evident from the analysis of the better off overall test in this submission.
b) In Waternish Engineering Pty Ltd, Roe C., after identifying a number of "less beneficial" terms of the agreement that were not mentioned in the F17 Declaration filed by the employer stated: "It is reasonable to conclude that if the employer failed to identify these matters to FWC they also failed to identify the matters to the employees. This raises a question mark as to whether or not the requirement in section 180 (5) has been met ... " 9 In Site Fleet Services Pty Ltd, Roe C., held that: "In circumstances where wage and conditions are in the main significantly better than the relevant Award it is not so important to understand in detail every disbenefit."10
c) In the recent decision in Shamrock Civil, the Full Bench stated that:" ... declaration that there are no less beneficial terms does give rise to concern as it is apparent as it is apparent that in fact there were a significant number of less beneficial terms. Aside from the obvious concern that the declarant has made a declaration that is untrue, it gives rise to a further concern as to the nature of the explanation given to employees as to terms of the Agreement and the effect of those terms. That is, it at least raises a real question as to the explanation to employees about the terms of the Agreement and in particular the effect of those terms, in circumstances where the employer is attesting that the agreement has no less beneficial terms." 11 The Full Bench went on to note, consistent with Waternish that "Such an employer understanding presumably lead it to provide the same misleading explanation to employees ... "12
Downer Blasting Submissions
 In reply to these submissions made by the CFMMEU, Downer Blasting provided submissions rejecting the allegation that it did not comply with subsection 180 (5) of the FW Act by failing to take all reasonable steps to explain the terms of the agreement, and the effect of those terms, in an appropriate manner taking into account the particular circumstances and needs of the relevant employees. The Applicant’s response in relation to the steps taken to explain the terms of the agreement was as follows:
a) Four bargaining meetings were held on 10 July 2017, 26 July 2017, 16 January 2018 and 31 January 2018. All four (4) bargaining representatives, Jarrett Goos and Vanessa Willis, HR Advisor, attended each meeting.
b) Bargaining followed a standard process of claim and counterclaim.
c) During the bargaining meetings on 26 July 2017 and 16 January 2018 Jarrett Goos and Vanessa Willis took the four bargaining representatives through the entire proposed Agreement clause by clause. Employees had access to versions of the Agreement each meeting and any changes were explained to employees.
d) Additionally, Jarrett Goos explained the proposed Agreement to bargaining representatives again clause by clause during the access period. Michael Morris said at paragraph  that following the final explanation meeting on 8 February 2018 that he was “…very clear on the Agreement. It was black and white to us. We had a chance to ask a lot more questions which Jarrett Goos answered.”
e) Further, Michael Morris states “I felt like I understood the Agreement. I was fully aware of what we were voting on. DBS (The Applicant) were trying to streamline their agreements and to win more work. This would benefit us as we were long term employees.”
f) Relevantly, employees had had the proposed Agreement explained to them twice during bargaining and again during the access period. All four employees attended the four bargaining meetings in which claims and counterclaims were made consistent with genuine bargaining. All four employees were experienced and had a minimum of four years employment with the Applicant and each had specifically nominated themselves as bargaining representatives.
g) Moreover, the bargaining representatives were fully informed of the Applicant’s industrial strategy and kept informed of relevant discussions with the CFMMEU.
h) Finally, the evidence from Jarrett Goos is that, in his opinion, there were no particular circumstances or needs of the relevant employees that needed to be taken into account. Specifically, Jarrett Goos stated at  of his statement that: “I did not believe that the bargaining representatives had any particular circumstances or needs which required me to take additional measures to explain the terms of the Agreement. I formed this view on the basis that:
i. The bargaining representatives each attended all of the four previous bargaining meetings during which I had go through the Agreement fully on three (3) separate occasions, including versions of the proposed agreement with ‘tracked changes’;
ii. I was confident that the employees’ were not from employees from culturally and linguistically diverse backgrounds; and
iii. The employees are not ‘young’. They are experienced in the workforce and have been employed for upwards of 4 years by Downer Blasting. 13
 The FW Act provides that the FWC must be satisfied that the Agreement passes the BOOT. The BOOT is defined in s 193 (1) as the FWC being satisfied that each award covered employee and each prospective award covered employee, for the agreement would be better off if the agreement applied to the employee than if the relevant modern award applied to the employee.
 In Armacell, a Full Bench stated: "The BOOT, as the name implies, requires an overall assessment to be made. This requires the identification of terms which are more beneficial for an employee, terms which are less beneficial and an overall assessment of whether an employee would be better off under the agreement." 14
 The CFMMEU submits that the FWC cannot be satisfied that the Agreement passes the BOOT. In that respect we firstly identify a number of less beneficial terms. They are as follows.
Clause 2.6 - Casual Employment
 CFMMEU submitted in relation to Casual Employment, the following:
a) Clause 2.6 provides for employment on a casual basis with a minimum of 4 hours per engagement, a loading of 25% on ordinary hours and termination on an hour's notice.
b) The Award does not provide for the employment on a casual basis for production and engineering employees. The F17 Declaration identifies that each classification in the Agreement has a comparable classification in the Award that is taken from Schedule A- Production and Engineering Employees.
c) It has been determined in some decisions that the inclusion of casual employment in an Agreement where the reference instrument is the Award and where the casual employment applies to production and engineering employees that as casual employment is a less secure from of employment and the casual loading of 25% is insufficient to compensate for the relevant detriments of casual employment it is a less beneficial term.
d) It is noted that there are decisions where the Award was the reference document and where the FWC has found that the inclusion of casual employment was not a less beneficial term. It is also noted that a Full Bench has considered casual employment in this context. The Full Bench made reference to the Moolarben and SFS Services decisions and noted the detriments identified by the CFMMEU, namely the absence of job security and the inadequacy of the casual loading. Whilst the Full Bench was satisfied that the BOOT in that case had been satisfied, the issue of casual employment is one of applying the BOOT. It was also the subject of discussion in One Key 15 where the Full Court summarised the contentions of the parties and whilst not accepting either, acknowledged that "whether the introduction of casual employment was a benefit or a detriment was a matter for the Commission."16
e) It is fair to say that there are differing views on the impact of casual employment. Of course, it may depend on the circumstances before the FWC.
f) The position of the CFMMEU remains that the introduction of casual employment into an agreement to cover production and engineering employees is a less beneficial term. As production and engineering employees cannot be employed on a casual basis under the Award and would have to be employed on a full time or part time basis, it is submitted that the absence of job security and the inadequacy of the loading means that casual employment is a less beneficial term for BOOT purposes.
Clause 2.8 - Part time Employment
 CFMMEU submitted in relation to Part Time Employment, the following:
a) Clause 2.8.1 of the Agreement provides that a part time employee "is one who is engaged by the week to work regular hours less than an average of 35 hours per week."
b) Clause 10.3 (a) (i) of the Award provides that a part time employee "works less than 35 hours per week".
c) The difference between the two provisions is the reference to the averaging of ordinary hours for part time employees in the Agreement. The effect of the averaging provision is that a part time employee may work more than 35 hours in any week as long as the average over the roster cycle is less than 35 hours per week. As the definition and purpose of part time employment in the Award is for employment of less than 35 hours per week, the provisions of the Agreement are less beneficial to a part time employee employed under the Award.
d) In support of this position we refer to the decision of Asbury DP in Link Mining Services Pty Ltd, where the Deputy President, in addressing a part time clause in a coal mining-based agreement stated: "The absence of such provisions in the Agreement is a detriment relevant to the BOOT as is the fact that part-time employees may be rostered to work more ordinary hours in a week than would be permitted under the Award" 17
Clause 2.9 - Termination of Employment
 There are a number of less beneficial terms under this heading, as follows:
a) Firstly, clause 2.9.1 of the Agreement provides that an employee "must give a minimum of two (2) calendar weeks' notice to terminate employment or forfeit to the Company two (2) weeks' pay instead of giving notice". This contrast with clause of the Award, which provides for a notice period of one week. In that regard, an employee under the Agreement must either work for an extra week or forfeit an additional weeks' pay.
b) Secondly, clause 2.9.4 of the Agreement confines the period of notice for redundancy to redundancy caused by certain factors, whereas clause 13.4 of the Award has no such limitation.
c) It is acknowledged that it is most unlikely that a redundancy would not be the result of one of the named factors.
d) Thirdly, clause 13.5 (b) (i) of the Award provides that where employment is terminated by reason of retrenchment, retirement at or after age 60, by the employer due ill health or by death, an employee who has a personal leave accrual of 70 or more hours is to be paid out that leave at the base rate. There is no equivalent provision in the Agreement.
e) It considering this provision it should be noted that employees accrue 105 hours personal leave upon employment and another 105 hours upon each anniversary of commencement. As such, an employee under the Agreement will be deprived of the benefit of that term as at commencement of employment and going forward it will depend upon the quantum of personal leave taken by the employee. An employee under the Award with a years' entitlement to leave would receive 3 weeks' pay (105/35 = 3} at the base rate, being $2575.80 (level 3 award rate of $858.60 x 3}.
f) Fourthly, clause 13.5 (b) (ii) provides that where an employment is terminated whilst an employee is absent on personal leave, the employee must be paid until his/her accumulation of leave has exhausted or the employee is fit for duty, whichever occurs first. The Agreement has no such provision. This has a monetary value depending upon the circumstances, which is denied to an employee under the Agreement
g) As clause 2.9 of the Agreement is less beneficial than the Award in a number of respects it is relevant to an assessment of the BOOT.
Clause 2.12 - Stand Down
 In relation to Stand Down, the CFMMEU submitted the following:
a) Clause 1.12.1 d restricts the taking of annual leave during a stand down situation to two of the three circumstances in which a stand down can occur.
b) Under the Award, which in turn applies the stand down provisions in the FW Act, an employee can take annual leave in each of the three situations.
c) The restriction in the Agreement on the taking of annual leave during a stand down is a less beneficial term. Whilst stand downs are not common, the less beneficial term is there and should be given some weight. Presumably the Applicant sees it of sufficient value in order to have it in the Agreement.
Clause 2.14 - Shut Down of Operations
 CFMMEU submitted in relation to Shut Down of Operations, the following:
a) Clause 2.14 is less beneficial to an employee under the Award, to whom clause 15.13 would apply, in a number of respects.
b) Firstly, unlike clause 2.14.1, where the employee has to elect to take either annual leave or leave without pay, there is no provision in the Award to compel an employee to take leave without pay (see clause 25.12 (d)).
c) Secondly, the Agreement, unlike the Award (clause 25.13 (c)), makes no provision for notice to be given to any employee who commenced employment after the initial period of notice was given.
d) Thirdly, where an employee under the Award does not have sufficient accrued annual leave and does not elect to take leave without pay, the employee is entitled to given work. In the event the Applicant proposes to use a stand down, any period of stand down would count for purposes of continuity of service as per s 22 (2) (b) (ii) of the FW Act. Under the Agreement the employee is required to take leave without pay that would not count as service (clause 2.14.3).
e) Fourthly, under the Award, if a public holiday falls during a shutdown period and would have been a working day, the day is treated as a public holiday regardless of the form of leave taken (if any) (see clause 25.12 (h)).
f) Whilst shut downs are not a common feature, to the extent they may occur, the provision in the Agreement is less beneficial to employees than the provision in the Award and should be taken into account for BOOT purposes.
Clause 3.2- Annual Wage Review
 CFMMEU submitted in relation to Annual Wage Review, the following:
a) Clause 3.2.1 of the Agreement makes no provision for any wage increase during its 4-year term. The provision in the clause for wage increases to occur at the discretion of the Applicant provides no comfort, let alone any legal guarantee, for a wage increase.
b) In Hart v Coles Supermarkets, the Full Bench held that "The wage increases available under the Agreement during the period of the Agreement are also a relevant consideration." 18 It went on to say that limited weight should be given because not all employees will remain during the period of the agreement and the level of future Award increases is unknown.19
c) Further, as Bromberg J. observed in Teys, "While the 'test time' is the time for application of the approval of the agreement (s 193 (6)), the Commission is clearly required to engage in a forward-looking analysis, in that the question is whether the relevant employees 'would be' better off if covered by the agreement rather than the modern award. That is a question that cannot be sensibly answered without assessing the likely position of agreement-covered employees over the course of the enterprise Agreement's term." 20
d) The Award, on the other hand, is subject to the Annual Wage Review conducted by the Expert Panel.
e) In this matter part of the "unknown" mentioned by the Coles Full Bench can be removed given the recent Annual Wage Review. That decision resulted in a 3.5% wage increase. 21 To that extent, any gap in wages between the Award and the Agreement at the test time has already been diminished.
f) It is further submitted that it can be said with a reasonable degree of confidence that there will be increases in wages from future annual wage reviews, whilst the quantum cannot be realistically predicted. However, what is clear is that the Agreement provides no such comfort. Further, any increase in the Award becomes a legal entitlement, whereas any increase determined by the Applicant during the life of the Agreement does not comprise part of the Agreement.
g) The failure to provide for any wage increase during the term of the Agreement is a less beneficial term that should be taken into account in the consideration of the BOOT.
Clause 3.3 -Allowances and Penalties
 CFMMEU submitted that there are a number of less beneficial terms in the Agreement relative to the Award:
a) Firstly, whilst clause 3.3.2 of the Agreement makes provision for night shift penalties that are equivalent to the Award, it does not define a night shift or permanent night shift. As such, an employee, by reading the Agreement, cannot know when an entitlement to night shift may arise. Under the Award the definition is clearly provided in clause 22.1 (b) and (c).
b) Secondly, unlike the Award, the Agreement does not make any provision for an afternoon shift. The Award, at clause 22.1 (a) defines afternoon shift as any shift, the ordinary hours of which finish after 6.00 pm and at or before midnight.
c) It follows that where an employee under the Agreement completes ordinary hours after 6.00 pm and it is not a night shift- whatever that is- the employee will be denied a 15% afternoon shift rate (clause 22.2 of the Award).
d) Thirdly, under the Award, where a 6 or 7-day shift worker works overtime during afternoon or night shift hours, the shift penalty is added to the overtime rate (clause 22.2). By way of example, a 6 or 7-day shift worker working overtime on during hours that fall within the definition of afternoon or night shift will be paid at a rate of 215%, whereas under the Agreement, a 7-day shift worker would be paid at a rate of 200% and a 6 day shift worker at 150% for the first 3 hours and 200% thereafter. This would disadvantage a Level 2, 7 day Blast Crew employee relative to the Award, who would be paid overtime at $52.00 per hour ($26.00 x 2), whereas the equivalent level 3 under the Award would be paid overtime at $52.7 4 per hour ( $24.53 x 215%).
e) Fourthly, under the Award, there is a provision of changing the shifts of permanent days workers to afternoon or night shift for periods of at least 3 consecutive days where the employee will be paid at overtime rates for the first shift worked (see clause 22.3 (a)). Where the change is for less than 3 days, overtime rates apply for each of the shifts (clause 22.3 (b)). There is no equivalent or comparable clause in the Agreement.
f) Whilst contingent, these are less beneficial terms that are accountable as part of the BOOT.
Clause 3.5- Payment of Wages
 CFMMEU submitted in relation to Payment of Wages, the following:
a) Clause 3.5.2 provides that the Applicant can deduct from an employee's final pay any agreed monies owing.
b) Clause 3.5.3 provides that where the quantum of monies owing are not agreed, the Applicant can still deduct the monies and hold it until the matter is resolved.
c) Section 326 of the FW Act provides that a provision entitling an employer to deduct from an amount payable to an employee is of no effect where it is unreasonable in the circumstances.
d) In AKN Pty Ltd T/A Aitkin Crane Services, a Full Bench held that even though a deduction of wage clause may be of no effect pursuant to s 326, it can be included in an Agreement. It also held that where there is a financial detriment it is a BOOT issue. 22
e) The provision in this Agreement does not provide any safeguard against a financial detriment arising from the operation of clauses 3.5.2 and 3.5.3. For example, there is no process for determining whether there has in fact been an overpayment in the first place, or in the event it is agreed that such overpayment occurred, any system for repayment that is reasonable in the circumstances.
f) There is no equivalent or comparable provision in the Award. Under the Award no such deduction is authorised. Accordingly, this provision is a less beneficial provision for employees and should be taken into account for BOOT purposes.
Clause 4.3- Change of Roster
 CFMMEU submitted in relation to Change of Roster, the following
a) Whilst clause 4.3.3 provides that the Applicant may move an employee to another place on the same roster by the giving of 7 days' notice or what it describes as "payment in lieu of overtime" or by agreement, the Award provides that where the 7 days is not given, the employee is to be paid at overtime rates for the time necessary to make up a weeks' notice (see clause 23.5 (ii)).
b) The absence of the penalty rate payment from the Agreement is a less beneficial term relative to the Award and is a BOOT consideration.
Clause 4.4 -Shift Starting/Finishing Point
 CFMMEU submitted in relation to Shift Starting/Finishing Point, the following:
a) In clause 4.4.1, the Agreement provides that the starting and finishing point shall be determined by the Applicant. The Award, on the other hand provides that the starting and finishing place of a shift is to be agreed between the employer and the majority of affected employees (see clause 23.4).
b) The Applicant's control of the starting and finishing point through the Agreement is a less beneficial term relative to the Award. It can have a detrimental impact on the time taken by an employee to travel to/from work where the starting and finishing place is moved further from the employee's residential address.
Clause 4.5 - Breaks
 CFMMEU submitted in relation to Breaks, the following:
a) Clauses 4.5.1 to 4.5.4 are both internally inconsistent and less beneficial than the Award.
b) On the point of inconsistency, the Agreement provides that an employee cannot work more than 5 hours without a paid meal break. Yet it also provides that on a shift of up to 10.5 hours, an employee is only entitled to one paid meal break.
c) However, a shift of up to 10.5 hours comprises at least 2 blocks of 5 hours. Hence if an employee cannot work more than 5 hours without a meal break, then on a 10.5 hour shift the employee is entitled to 2 paid meal breaks. This is even more the case when it is observed that clause 4.5.1 states that the break is not to be taken before the third hour from the commencement of the shift. Thus, if an employee has a paid meal break at the commencement of the 4th hour, the next paid meal break, consistent with the no more than 5-hour rule, must be taken at the commencement of the 9th hour. The meal break forms part of the employee's rostered hours of work.
d) This inconsistency is also apparent when the Award provision is considered. Clause 24.1 of the Award provides that an employee is entitled to a meal break without deduction of pay for each 5-hour worked during rostered hours, whilst clause 24.2 provides that an employee will not be required to work more than 5 hours without a meal break. Clause 24.3 further provides that where an employee agrees to work more than 5 hours then the employee will, unless otherwise agreed, be paid for any work beyond 5 hours at the applicable overtime rate until the meal break is taken.
e) Applying the Award to a 10.5-hour shift means that an employee is entitled to 2 paid meal breaks or paid at overtime rates when the 5th hour is reached until the meal break is taken.
f) The meal break provision in the Agreement is a less beneficial term to employees than the meal break provision in the Award. This has been recognised by the Commission in other matters where the issue of a 10.5 hour shifts in coal mines has been addressed. 23
g) As a less beneficial term, the meal payment provision is to be taken into account for purposes of the BOOT.
Clause 4.6 - Overtime
 CFMMEU submitted in relation to Overtime, the following:
a) It is noted from clause 4.2.1 that employees may be required to work either a 5-day roster (Monday to Friday) or a 6 or 7-day roster.
b) Clause 4.6 provides for 2 types of overtime- overtime on a Monday to Friday roster and overtime on a continuous roster. A continuous roster is defined as a 7-day roster or a roster which requires ordinary shifts on public holidays and not less than 272 hours per year on Sundays (clause 1.8). The Agreement also has a definition of non-continuous roster as meaning roster cycles in which day/night shifts are rostered to work over five or six days per week (clause 1.8).
c) On the basis of the definitions a 6-day roster employee works to a non-continuous shift roster. However, the Agreement does not contain a provision for an overtime entitlement for a 6-day roster employee. On that basis there appears to be no overtime entitlement for such employees who may be required by the Applicant to work overtime.
d) Alternatively, if a 6-day roster employee was to be deemed as equivalent to a Monday to Friday roster employee (as they are clearly differentiated from the continuous shift roster as defined), the overtime rate is less beneficial than the overtime rate under the Award (see clause 17.2 (b) (i)).
e) As pointed out at paragraph 99 above, a 6 or 7-day shift worker is entitled to a combination of double time and the relevant shift penalty where overtime is worked during afternoon or night shift hours (clause 22.2). This is a further less beneficial term of the Agreement.
f) A third less beneficial term regarding overtime is the provision for meal breaks and provision of a meal or meal allowance when working non-rostered overtime. Clause 17.8 of the Award provides that where an employee is required to work more than 1.5 hours past their rostered shift, the employee is entitled to a meal break of 30 minutes without deduction of pay prior to commencing the overtime. The employee is then entitled to a paid meal break of 30 minutes after every 5 hours of overtime. Further where the employee was not notified of the overtime on the previous day, the employee will be supplied with a meal or alternatively paid a meal allowance of $15.0156 The Agreement, on the other hand, has no such provision for meal breaks and meals for non-rostered overtime and consequently that is a less beneficial provision than the Award.
g) A fourth less beneficial term is the absence of a time off instead of overtime clause. This can be found at clause 17.9 of the Award. Whilst the scope of the benefit is contingent upon employee preference and the Applicant's agreement, it should be given some weight.
Clause 4.7 - Call Back
 CFMMEU submitted in relation to Call Back, the following:
a) Clause 4.7 provides for a minimum payment of 2 hours for a call back. This contrasts unfavourably with the Award, which provides for a minimum payment of 4 hours (clause 17.7).
b) The call back provision of the Agreement is a less beneficial provision for purposes of the BOOT.
Clause 5.1 -Annual Leave
 CFMMEU submitted in relation to Annual Leave, the following:
a) Clause 5.1.6 and 5.1.7 make provision for the taking of annual leave. They provide that an employee must give 28 days' written notice of the amount of leave to be taken and whether leave can be taken as requested is a matter for the Applicant's discretion. Further it provides that the Applicant can direct an employee who has in excess of 8 weeks of accrual annual leave to take annual leave. This provision stands in stark contrast to the provisions in the Award for the taking of leave (clause 25.4). Under the Award, the Applicant must adhere to a consultative process where it wants an employee with more than 10 or 12 weeks' accrued leave (depending upon the entitlement to annual leave) to take some of that leave. The Applicant is also restricted in the amount of leave it can require an employee to take and the time the leave can be taken. Further, from 1 December 2018, an employee will have an entitlement to, following due process and subject to certain limits, to require the Applicant to grant him/her annual leave.
b) The Award provisions provide a number of protections to the employee that have been removed by the Agreement. Under the Award, the Applicant cannot direct an employee with an accrued leave of between 8 and 10 weeks or less to take leave and where the accrual is greater than 10 or 12 weeks the process and limitations apply.
c) With respect to the taking of annual leave the Agreement is less beneficial than the Award and should be taken into account as a BOOT consideration.
Clause 5.8 - Personal/Carers Leave
 CFMMEU submitted in relation to Personal/Carers Leave, the following:
a) Clause 26.4 of the Award provides that where an employee is absent for fewer than half the ordinary hours component of the shift, there is no deduction from personal leave and in all other cases the full ordinary hour's component is deducted.
b) There is no equivalent or counterpart provision in the Agreement.
c) In that regard it is not possible under the Agreement for an employee to take a few hours off work for a medical appointment without having the hours deducted from personal leave. It follows that the personal leave clause in the Agreement is less beneficial than the Award to that extent and should be taken into account as a BOOT consideration.
 CFMMEU submitted in relation to Public Holidays, the following:
a) Clause 5.8.5 of the Agreement provides for payment at double time and a half when rostered to work on a public holiday.
b) Clause 27.4 (a) of the Award provides for payment when rostered to work to be paid at the rate of double time in addition to the payment prescribed i.e. treble time.
c) The Agreement is accordingly less beneficial to an employee than the Award when an employee is rostered to work on a public holiday.
d) Clause 27.4 (b) of the Award provides that hours in excess of ordinary hours i.e. overtime, worked on a public holiday is paid at treble time.
e) The Agreement does not make any special provision for working overtime on a public holiday, with the exception of rostered overtime as part of the rostered hours in clause 5.8.5. As such this means that rostered overtime would be paid at double time and a half and non-rostered overtime at double time for a continuous shift worker or time and a half for the first 3 hours and double time thereafter for non-continuous workers.
f) In circumstances where an employee works on a public holiday- either on ordinary hours or overtime, the Agreement contains a less beneficial provision than the Agreement and should be taken into account for BOOT purposes.
Other Less Beneficial Terms
 CMMEU submitted further that the Award contains a number of beneficial terms for employees that do not have an equivalent or counterpart provision in the Agreement, as follows:
a) Clause 16.2 of the Award provides for mixed functions; that where an employee performs mixed functions on any shift the employee must be paid for the whole shift at the rate applicable to the highest function. The Agreement contains no such entitlement.
b) Clause 16.7 provides that on termination of employment an employee must be paid his/her final pay on the day of termination or forwarded by post within 72 hours. The Agreement contains no such entitlement.
c) Clause A.8.2 of Schedule A provides for various allowances. Of relevance to employees under this Agreement would be the water allowance (0.49% of the standard rate per shift i.e. $3.94 per shift), first aid attendant allowance (0.45% of the standard rate per shift i.e. $3.61 per shift), Dirty work (0.23% of the standard rate per shift i.e. $1.85 per shift) and the Open Cut Allowance (0.43% of the standard rate per afternoon shift i.e. $3.45 per afternoon shift and 0.85% of the standard rate per night shift i.e. $6.83 per night shift). The Award contains no such entitlement.
 It was submitted that the essential question on the BOOT assessment is whether the Commission can be satisfied that for each employee and each prospective employee, the wage rates in the Agreement are sufficient to more than counterbalance the less beneficial terms identified in this submission and as such meet the BOOT:
a) At the base rate and for a 35-hour week, the difference between the wage rates in the Agreement and the Award ranges from $51.45 (Level 2) per week to $86.45 (Level 4) per week. If all other payments in the Agreement and the Award were identical then, save for the non-monetary less beneficial terms, the BOOT would be satisfied. But the entitlement to certain penalty rates and overtime payments are not identical nor is the entitlement to certain other payments and those rates and payments in the Award are more beneficial than their counterpart provision in the Agreement. The extent to which such terms diminish or abolish the benefits of the higher wage rates in the Agreement depends on the hours of work arrangements and the classification in question.
b) The Agreement is open ended with respect to the hours of work arrangements. The FWC cannot discern from the Agreement what rosters the F17 Declaration, paragraph 3.4 Applicant works and what rosters the Applicant may introduce in the future. This is evident from the terms of clause 4.2.
c) In assessing the BOOT, the FWC has to assess the Agreement on an objective basis of what the Agreement permits and not what Applicant says it does or may or may not do. In Lobethal, Asbury DP stated: The submission for Lobethal that the Company does not work night shifts is not to the point. The Agreement enables a night shift to be work and in circumstances where I am not satisfied that employees who may be required to work a night shift would not be better off than they would under the Award." 241n Waternish Roe C stated: "Waternish had given evidence that it is not common for its employees to work overtime. I accept that evidence but there is nothing in the Agreement that prevents further overtime being worked and the BOOT should be conducted against what the Agreement provides."25
d) In the recent Loaded Rates Decision, the Full Bench, stated that, in the context of loaded rates, the BOOT required "an examination of the practices and arrangements concerning the working of ordinary and overtime hours by existing and prospective employees that flow from the terms of the agreement." 26 Whilst this Agreement does not have loaded rates, the reference is helpful in determining how the FWC is to apply the BOOT.
e) Any gap between the Agreement and the Award in terms of the wage rates can be diminished or removed by a number of Award terms.
f) Firstly, whilst the Award provides for an Open Cut Allowance, the Agreement does not. Any employee working in an open cut mine is entitled to $3.45 per shift for each afternoon shift and to $6.83 per shift for each night shift. Over 5 shifts the open cut allowance is $17.25 and $34.15 respectively.
g) Secondly, whilst the Award provides for afternoon shift allowances, the Agreement does not. Thus, where an employee works a shift where the ordinary hours finish after 6.00 pm and at or before midnight, the employee is paid a shift allowance of 15%.
h) Thirdly, whilst the Award provides for an employee on a 6-day roster to be paid overtime at double time, the Agreement does not. At best the Agreement provides for time and a half for the first 3 hours and double time thereafter. Where a roster provides for 10-hour shifts comprising 8 hours at ordinary time and 2 hours at overtime, the difference in the overtime entitlement is 0.5 hour per shift. The working of overtime, especially a period of rostered overtime, is a common feature at coal mines.
i) Fourthly, whilst the Award provides for 6 and 7-day roster employees who work overtime during afternoon or night hours to the relevant shift penalty in addition to the overtime rate, the Agreement does not. Under the Award the appropriate penalty rate is increased by either 15% or 25% depending on the shift.
j) Fifthly, under the Award an employee is entitled, in certain circumstances to a first aid allowance ($3.61 per shift), or a wet work allowance ($3.94 per shift} and a dirty work allowance ($1.95 per shift), whereas under the Agreement there is no such entitlement.
k) Sixthly, under the Award, the employee is entitled to overtime payments when he/she works more than 5 hours without a meal break. Under the Agreement an employee is entitled to only one meal break on a 10.5-hour shift. In this scenario, the employee under the Award would be entitled to a period of overtime depending on when the 5-hour barrier is breached.
l) Seventhly, under the Award, if an employee works ordinary hours on a public holiday, payment is made a triple time (including a shift allowance if applicable) as is payment if overtime is worked on a public holiday (including a shift allowance if applicable), whereas under the Agreement the payment is less regardless of the status of shift work.
m) The Agreement provides for a 5 day, Monday to Friday roster (see clause 4.2.1}. Where any employee at Level 1 to 5 works a 5-day roster on what would, under the Award, be an afternoon shift, the employee would be worse off than if under the Award. For example, the effective hourly rate for a level 2 under the Award would be $28.21 ($24.53 x 15%} compared to $26.00 under the Agreement, and for a level 4 the award rate would be $29.58 per hour compared to $28.50 per hour under the Agreement. Then we need to add the open cut allowance of $17.24
n) If the roster in paragraph 164 was changed to a 6-day roster (provided for in clause 4.2.1), say Monday to Friday in week 1 and Tuesday to Saturday in Week 2, and provided for rostered overtime of 2 hours per shift, the employees would become even worse off under the Agreement relative to the Award because of the lower overtime rate.
o) Account should also be taken of the fact that the Agreement does not provide for any set wage increases going forward, whereas the Award is subject to any increase from the Annual Wage Review decisions. Recently, the FWC handed down a 3.5% increase in the award minimum wages. For a Level 3 in the Award, the hourly rate increases from $25.43 to $25.39. By comparison with the Agreement, the advantage held by the Agreement in terms of the higher base rate falls from $1.57 per hour to $0.61 per hour. Further, to the extent that the Applicant may increase the wage rates for Agreement covered employees (and keeping in mind that any increase is not a consequence of an entitlement under the Agreement), it will not take place until after 1 July 2019 and in the meantime another Annual Wage Review will have occurred, and any outcome applied to the Award.
p) Whilst it is recognised that these are not the only rosters that the Applicant may work, the BOOT must be applied to what the Agreement permits. It permits these rosters and it is evident that under these rosters the BOOT cannot be met. It is evident that the Agreement covers a broad range of rosters for a purpose- to be call on where required. And whilst the impact of the higher wage rates will change depending on the roster and the impact of the paragraphs 157 to 163 above it is submitted that when assessed against the further impact of the additional identified less beneficial terms -being a combination of monetary and non-monetary terms the Commission cannot be satisfied that BOOT has been met in this matter.
q) The less beneficial terms that we have identified in addition to those in paragraphs 157 to 163 above can also have serious monetary outcomes. For example, the entitlement to be paid out personal leave upon termination, the reduction in the minimum call back payment, the payment of a meal allowance, the entitlement to mixed functions and the payment of overtime when insufficient notice is given of a roster change. Further, as can be seen in paragraph 144 it is not as though there are a small number of less beneficial terms that can be easily offset by a higher wage rate. When assessed overall, these less beneficial terms constitute a significant package.
r) Whilst the Applicant may well contend that certain of the less beneficial terms identified above are of a minor nature the fact is that they constitute entitlements under the Award and it was the Applicant that sought their absence in the Agreement. It must have done so for some reason and should certainly have been aware of the terms of the Award being removed or diminished.
s) Based on the above, it is submitted that the FWC cannot be satisfied that the Agreement meets the BOOT and the Agreement should not be approved. 27
Downer Blasting’s submissions
 In response to the CFMMEU objections made in relation to the assessment of the BOOT, Downer Blasting rejected the CFMMEU submissions that the Agreement does not pass the BOOT as required by subsection 186(2)(d) of the Act. Relevantly, the Commission in its initial review of the Agreement raised a small number of items of concern with respect to the BOOT assessment. The Commission forwarded this assessment to the parties on 27 June 2018.
 The Applicant responded to the CFMMEU submissions in relation to the BOOT as follows (references relate to paragraph numbers in the CFMMEU’s submissions):
a) Term of Obligation not in the Award - - This is not an Award term and has no bearing on the BOOT. As set out above, the Agreement does not incorporate DBS’ policies, standards and procedures.
b) Casual Employment - - This is not an Award term and has no bearing on the BOOT. Flexibility in how and when an employee can work may be beneficial and desirable to an employee. Providing flexibility in how an operation can man a workforce may have positive impacts to the overall workforce. This is a neutral factor.
c) Part-time Employment – Averaging of Hours - – Rosters in the mining industry often run across several weeks. In circumstances where wages are paid weekly, it can result in wide fluctuations in the amount of take home pay. This is disruptive to employees and may make budgeting income more difficult. By averaging the hours, employees receive a benefit of receiving the same take home pay each week. This is beneficial to employees.
d) Termination of Employment -
i. 2 Weeks’ Notice - – This is less beneficial than the Award, but is not significantly so. Clause 2.4.2 of the Agreement provides that employees in their probationary period (the first six (6) months of employment) need only give one (1) weeks’ notice. Accordingly, only those employees who have more than six (6) months’ service but less than one (1) year are affected compared to the Award.
ii. Constraints on Redundancy - – Clause 2.9.4 of the Agreement mirrors clause 14.4 of the Award. Clause 2.9.5 of the Agreement mirrors clause 13.4 of the Award.
iii. Payment of Personal/Carer’s Leave – Certain Factors - – The absence of the payment of personal/carer’s leave on termination is less beneficial however the Agreement provides for the payment of personal/carer’s leave during employment at the Aggregated Annualised Wage which is a far superior entitlement.
iv. Termination during Personal/Carer’s Leave  – The absence of the continuation of payment of personal/carer’s leave on termination is less beneficial however the Agreement provides for the payment of personal/carer’s leave during employment at the Aggregated Annualised Wage which is a far superior entitlement.
e) Stand Down - – The Award does not address Stand Down provisions. Employers are prohibited from paying employees during industrial action. If employees are already on annual leave during a period of industrial action, it stands to reason that they are also not stood down during that period and would remain on annual leave.
f) Shut Down of Operations - – The Award is silent on directing an employee with no accrued annual leave to take leave without pay; however, this would be the only option available to an employee in circumstances of a Shutdown in accordance with 25.12 of the Award where an employer did not agree to allow the employee to take leave they had not accrued. Given the contingent nature of this claim, the provision should be regarded as neutral.
g) The Agreement provides that an employee who is not required to work on a public holiday is entitled to payment for the ordinary hours (5.8.7).
h) Annual Wage Review - – The Award does not provide for an annual wage review. Section 206 of the Act requires:
Base rate of pay under an enterprise agreement must not be less than the modern award rate or the national minimum wage order rate etc.
If an employee is covered by a modern award that is in operation
(a) an enterprise agreement applies to an employee; and
(b) a modern award that is in operation covers the employee;
the base rate of pay payable to the employee under the agreement (the agreement rate) must not be less than the base rate of pay that would be payable to the employee under the modern award (the award rate) if the modern award applied to the employee.
(2) If the agreement rate is less than the award rate, the agreement has effect in relation to the employee as if the agreement rate were equal to the award rate.
Relevantly, the Agreement must continue to keep pace with the relevant base hourly rates set out in the Award. In this way, the Agreement operates in the same capacity as the Award.
i) Allowances and Penalties - –
i. Night Shift  – The Agreement does not define night shift. This is not necessarily less beneficial but clarity is desirable. Accordingly, this should be addressed in an Undertaking.
ii. Afternoon Shift - – The Agreement does not provide for an afternoon shift. While DBS does not operate an afternoon panel it is acknowledged that it could. Accordingly, this should be addressed in an Undertaking.
iii. 6-Day Employee Overtime  – The Agreement does not provide for an afternoon shift. While DBS does not operate an afternoon panel it is acknowledged that it could. Accordingly, this should be addressed in an Undertaking.
iv. Changing Shift Type – Penalty  – The Agreement requires 7 days’ notice to be given to employees of any change.
j) Payment of Wages - – The Award does not address this issue. A deduction from an employee’s wages where the deduction is authorised / reasonable is lawful under sections 324-326 of the Act. The safeguards are set out in section 236 of the Act. This is a neutral consideration. The Award does however authorise the employer to deduct amounts to cover any annual leave paid in advance (clause 25.11 (d)).
k) Change of Roster - – The Agreement requires employees to be given seven (7) days’ notice of a change in roster unless they otherwise agree.
l) Shift Starting / Finishing Point - – The Agreement requires the nominated area to be on site. The CFMMEU’s concerns are overstated.
m) Breaks - – There is no inconsistency with the Breaks clause (4.5) of the Agreement, although the clause can be applied differently depending on the circumstances. This is reasonable and sensible.
n) Clause 4.5.1 of the Agreement provides that “An Employee is not to work more than 5 hours without a paid break”. If an employee worked 5 hours, took a half hour break, and then worked an additional 5 hours (10.5 hours in total) the employee would receive only one break. However, if the employee worked a different configuration of hours such that following their first break they worked more than an additional 5 hours, the employee would be entitled to a second meal break.
o) Overtime - – The Agreement does not adequately define a 6-Day Roster employee for the purposes of overtime. This is not necessarily less beneficial but clarity is desirable. Accordingly, this should be addressed in an Undertaking.
p) Call Back  – The Agreement provision is less than the Award provisions; however, it is a contingent benefit and should be given little weight.
q) Annual Leave - – The Agreement provision is not significantly different than the Award provisions and should be given little weight.
r) Personal / Carer’s Leave - – The difference in the deduction rules around the provision of personal/carer’s leave are different however the Agreement provides for the payment of personal/carer’s leave during employment at the Aggregated Annualised Wage which is a far superior entitlement.
s) Public Holiday - – The penalty rate for working a public holiday is less beneficial than the Award. Accordingly, this should be addressed in an Undertaking.
t) Mixed Function  – An employee must be paid in accordance with the work they are doing in accordance with 3.1.4. It follows that if the employee is working at a higher level than they must be paid at the higher level.
i. Water Allowance – This Allowance is compensated for by the higher base rate of pay.
ii. First Aid Attendant Allowance – This Allowance is payable under the Award only where the employee is appointed by the Employer in that capacity. This is a contingent entitlement and should not be considered for the purposes of the BOOT.
iii. Dirty Work Allowance – This Allowance is compensated for by the higher base rate of pay.
iv. Open Cut Allowance – This Allowance is compensated for by the higher base rate of pay.
 On 13 July 2018, Mr Goos provided the Commission with a statement in relation to the steps that were taken to satisfy the pre-approval requirements under the FW Act. His statement was as follows:
a) Downer Blasting provides contract blasting services at Duralie Coal mine. Downer Blasting is engaged by Yancoal Australia Ltd, owner of the mine.
b) I was responsible for leading the negotiation of the Downer ED/ Mining – Blasting Services NSW Coal Enterprise Agreement 2018 (the Agreement). I attended all negotiation meetings for the Agreement.
c) Since July 2017 Downer Blasting have been negotiating the Agreement with four (4) bargaining representatives:
• Michael Morris
• Dean Herbert
• Ryan Delarue
• Daniel Clarke
d) Each of the four employees nominated themselves as bargaining representatives. negotiated the Agreement directly with these employees.
e) These employees have been employed with Downer Blasting continuously at Duralie since at least September 2013 with Michael Morris having been employed since September 2010.
a) I held the first bargaining meeting on site at Dura lie Mine on 10 July 2017. In attendance at the meeting was Dayne Somers, Operations Manager, Vanessa Willis, HR Advisor, and the four bargaining representatives.
b) During that meeting I outlined Downer Blasting's desire to reduce labour costs in New South Wales (NSW) in order to have more competitive rates.
c) I provided an overview of Downer Mining's contract end at Boggabri Mine. The end of Downer Mining's contract at Boggabri was significant for Downer Blasting, who employed approximately 30 employees at the site.
d) I explained that Downer Blasting's commercial tender to win an extension of work at Boggabri was still outstanding. I outlined Downer Blasting's broad industrial strategy for NSW, which essentially involved splitting the existing Downer ED/ Mining Blasting Services New South Wales Coal Enterprise Agreement 2013 (Existing Agreement) into three (3) separate enterprise agreements:
• A site-specific enterprise agreement at Boggabri Mine;
• A manufacturing-specific enterprise agreement for Downer Blasting's emulsion production facility at Mt Thorley; and
• A new NSW enterprise agreement made with the Duralie Mine employees which excluded coverage of Boggabri Mine and manufacturing activities.
e) I further explained that the success of our NSW strategy hinged on the employees engaged at Duralie Mine supporting a new NSW enterprise agreement.
f) I had previously outlined this strategy to Peter Jordan, CFMEU Northern Mining & NSW Energy District President, and Jeff Drayton, CFMEU Northern Mining & NSW Energy District President District Vice President, in an email on 12 May 2017 and then again at a meeting at their Cessnock office on 2 June 2017. This email is attached as Appendix A.
g) At the first bargaining meeting on 10 July 2017, and on the basis that Downer Blasting were seeking to implement a new NSW enterprise agreement, Vanessa Willis provided each employee with a printed copy of the Agreement.
h) Using a version of the Agreement with tracked changes highlighting the differences between the Existing Agreement and the proposed Agreement, I took employees through the proposed Agreement and explained it clause by clause to ensure employees fully understood our full strategy, and the terms of the proposed Agreement and the impact and effect of the changes. The Agreement draft with tracked changes is attached as Appendix B.
i) Employees specifically asked questions regarding options to cash out personal I carer's leave, how employment terms may vary if employees were seconded to sites in the Hunter Valley where labour rates are much higher, the implementation of a rain allowance and the implementation of a production bonus.
j) I advised the bargaining representatives that we would consider their claims and respond at the next meeting.
26 July 2017 - Second Bargaining Meeting
a) I held the second meeting with Duralie employees on 26 July 2017. In attendance was Dayne Somers, Operations Manager, Vanessa Willis, HR Advisor, and the four bargaining representatives.
b) At this meeting, I provided an update on the meeting at Boggabri for a site-specific Downer Blasting agreement which was held the day prior.
c) Michael Morris advised me that Downer Blasting employees from Boggabri had contacted him in relation to our strategy to split the enterprise agreement. Michael indicated that the Boggabri employee was against any change to the existing structure of one combined NSW enterprise agreement.
d) I further explained that our bargaining process may be slowed down due to some challenges presented by the union in NSW. It was advised they may be contacted by the CFMEU regarding the negotiations and representation.
e) I reiterated to the bargaining representatives that they had a right to representation from the union. I remember being particularly cautious on this point as Downer had received a Protected Action Ballot Order on 13 July from the CFMEU in relation to the expired Downer Mining enterprise agreement applicable at Boggabri. I suspected that the CFMEU would contact the employees at Duralie and I wanted to ensure that employees had been given correct advice regarding their right to representation.
f) In relation to the proposal and to claims discussed at the meeting on 10 July 2017 I provided a counter-offer which included a:
• $1,500 sign-on bonus;
• 2% pay increases in year 3 and 4 of the agreement;
• Rejection of the ability to cash out personal/carers leave
g) I concluded the meeting by asking bargaining representatives to consider our proposal in order to respond at a future meeting.
h) On 4 August 2017 I was informed by Paul Cassano, Downer Blasting Executive General Manager, by email that our commercial bid to retain the Downer Blasting Boggabri contract had been unsuccessful.
16 January 2018 - Third Bargaining Meeting
a) I held the third bargaining meeting at Duralie Mine on 16 January 2018. In attendance was Chris Vane, Operations Manager, Scott Bury, HR Manager, Vanessa Willis, HR Advisor, and the four bargaining representatives.
b) To commence the meeting I provided an update on the state of business, specifically as it related to the loss of the Boggabri Mine blasting contract and the demobilisation of employees from site.
c) I discussed Downer Blasting's preference to revise its approach and to expand the coverage of the proposed Agreement to cover all of NSW, except for the Mt Thorley emulsion facility.
d) Vanessa Willis provided employees with a copy of the proposed Agreement which contained 'tracked changes'. I explained the entire agreement again, clause by clause, specifically outlining the meaning and impact of the marked up terms.
e) The bargaining representatives were particularly interested in the redundancy provisions and asked specifically in relation to their own length of service what their entitlement to severance would be. We discussed the changes to the Black Coal Mining Industry Award 2010 which had capped the weeks' retrenchment pay an employee could receive to a maximum of 30.
f) I advised that the proposed Agreement did not cap retrenchment pay.
g) We also discussed options to salary sacrifice personal/carer's leave.
h) The bargaining representatives gave a counter proposal for the sign-on bonus of $2,500 and but I recall feeling that they otherwise supported the overall strategy. We agreed to return to site in the next week and continue bargaining.
31 January 2018- Fourth Bargaining Meeting
a) I held the fourth bargaining meeting at Duralie Mine on 31 January 2018. In attendance was Vanessa Willis, HR Advisor, and the four bargaining representatives.
b) The bargaining representatives reiterated their claim to a $2,500 sign-on bonus.
c) We discussed the ability for Downer Blasting to increase base rates depending on the applicable site and market conditions and agreed to 'grandfather' their conditions.
1 February 2018 - Ballot Notice I Agreement issued
a) I am aware that on 1 February 2018 Vanessa Willis, HR Advisor, emailed the four bargaining representatives individually and issued them with a copy of the Ballot Notice, specifying the time, place and method of the ballot, a copy of the proposed Agreement and a letter specifying the sign-on bonus and the grandfathering arrangements.
8 February 2018 - Access Period Explanation
a) I attended site on 8 February 2018 during the access period to explain the proposed Agreement to employees. In attendance was Vanessa Willis, HR Advisor, and the four bargaining representatives.
b) During this meeting I proceeded to explain the proposed Agreement clause by clause. I was careful to ensure that the requirements of the Fair Work Act 2009 (Cth) were met during this meeting, in particular subsection 180 (5) which relate to the explanation of the terms.
c) I did not believe that the bargaining representatives had any particular circumstances or needs which required me to take additional measures to explain the terms of the Agreement. I formed this view on the basis that:
d) The bargaining representatives each attended all of the four previous bargaining meetings during which I had gone through the Agreement fully on three (3) separate occasions, including versions of the proposed agreement with 'tracked changes';
e) I was confident that the employees' were not from culturally and linguistically diverse backgrounds; and
f) The employees were experienced workers who had been employed for upwards of 4 years by Downer Blasting.
g) The employees unanimously approved the Agreement on 9 February 2018. As bargaining representatives, the employees were emailed a copy of the Form 16 - Application and Form 17 - Statutory Declaration which accompanied the signed Agreement. No issues were ra1sed by employees regarding the accuracy of the declaration. 28
 On 13 July 2018, Mr Michael Morris provided the Commission with his statement in relation to the steps Downer Blasting took to satisfy the pre-approval requirements under the FW Act. His statement was as follows:
26 June 2017
a) I attended a meeting with Dayne Somers, Operations Manager, Ryan Delarue and Daniel Clarke. Dean Herbert was away that day. Dayne Somers informed us that DBS wanted to start bargaining for a new enterprise agreement which would cover NSW but not Boggabri Mine or the Mt Thorley Emulsion facility.
b) During that meeting Dayne Somers gave us a copy of the Notice of Employee Representational Rights. A copy was left for Dean Herbert. I gave Dean Herbert his copy the next day.
c) Dayne Somers informed us that we could have a representative during the bargaining for a new enterprise agreement. Dayne Somers gave us copies of a form that we could use to appoint a representative.
d) I recall having a conversation with Ryan Delarue and Daniel Clarke were we discussed whether we would nominate ourselves. We completed the bargaining representative appointment forms on 26 June 2017. Dean Herbert signed his on 27 June 2017. I emailed them all to Vanessa Willis on 28 June 2017.
10 July 2017- First Bargaining Meeting
a) I attended the first bargaining meeting on site at Duralie Mine on 10 July 2017. At that meeting was Jarrett Goos, Employee Relations Manager, Dayne Somers, Operations Manager, Vanessa Willis, HR Advisor, and the other three employee bargaining representatives.
b) During that meeting Jarrett Goos explained the agreement procedure and how the changes would be made to the draft Proposed Agreement. It was a long meeting.
c) Jarrett Goos read through the Proposed Agreement, paragraph by paragraph. We were left copies of the Proposed Agreement.
d) We had a number of ideas about things we wanted to include in the proposed Agreement like cashing out sick leave. Jarrett Goos told us that management would respond in the next meeting.
26 July 2017- Second Bargaining Meeting
a) I attended the next meeting on 26 July 2017. At this meeting were Jarrett Goos, Dayne Somers, Vanessa Willis, and the other three employee bargaining representatives.
b) We received another copy of the Proposed Agreement.
c) At this meeting management told us there would be a delay in the bargaining because of the issues at Boggabri, including whether Downer Blasting would win an extension at Boggabri.
16 January 2018 -Third Bargaining Meeting
a) I attended the third bargaining meeting at Duralie Mine on 16 January 2018. In attendance was Jarrett Goos, Chris Vane, Operations Manager, Scott Bury, HR Manager, Vanessa Willis, HR Advisor, and the other three employee bargaining representatives.
b) It had been a few months since the last meeting. We were aware that DBS had lost the blasting contract at Boggabri Mine.
c) Jarrett Goos explained that the strategy would now involve a single NSW-wide agreement.
d) Vanessa Willis provided us with a copy of the proposed Agreement which contained 'tracked changes'. Jarrett Goos explained the entire agreement again.
e) We asked Jarrett Goos about the differences between redundancy and severance.
f) We were concerned about there being a cap on the payout of redundancy.
g) We also discussed a scheme to pay out personal/carer's leave or roll it into super.
h) Jarrett Goos said he would consider it and come back to us. We asked for a sign-on bonus of $2,500.
i) Management said they would consider our position and get back to us in the next few weeks.
31 January 2018 - Fourth Bargaining Meeting
a) I attended the fourth bargaining meeting at Duralie Mine on 31 January 2018. In attendance was Jarrett Goos, Vanessa Willis and the other three bargaining representatives.
b) During this meeting we repeated our demand for a $2,500 sign-on bonus. I recall that it was something we weren't going to budge on. Jarrett Goos made a phone call to Paul Cassano who eventually approved the payment.
c) At the end of that meeting we had reached an agreement.
1 February 2018 - Ballot Notice I Agreement issued
a) On 1 February 2018 Vanessa Willis emailed myself a copy of the Ballot Notice, a copy of the proposed Agreement and a letter detailing the sign-on bonus. I am aware that the other employees received the same email.
8 February 2018 - Access Period Explanation
a) I attended a meeting on 8 February 2018. In attendance were Jarrett Goos, Vanessa Willis and the other bargaining representatives.
b) Jarrett Goos went through the Agreement in full again.
c) At this stage, I was very clear on the Agreement. It was black and white to us. We had a chance to ask a lot more questions which Jarrett Goos answered.
d) Vanessa Willis had emailed and phoned me to arrange for the ballot to be held on site. I ran the ballot the next day, 9 February 2018. It was 4 votes to zip. We all signed a copy of the ballot result form which I emailed to Vanessa Willis.
e) I felt like I understood the Agreement. I was fully aware of what we were voting on. DBS were trying to streamline their agreements and to win more work. This would benefit us as we were long term employees.
f) Every meeting we received a copy of the Agreement and it was explained to us. 29
 At the Hearing, Mr Jarrett Goos, Group Employee Relations Manager employed by Downer Blasting gave evidence and was cross examined by Mr Bukarica from the CFMMEU. Under cross examination, Mr Goos gave evidence to the following effect:
a) the Applicant has a sufficient human resources capacity. 30
b) He explained the impact and meaning of the agreement provisions but did not contrast the less beneficial agreement terms to the award. 31
c) For example, one of the less beneficial terms in the Agreement, the non-payment of accrued personal leave in the event of termination due to redundancy, retirement or ill health, was not brought to the attention of employees by way of comparison to the award but to the previous agreement. 32
d) There were instances in the explanation of the agreement where employees had an understanding of some elements of the award such as severance entitlements and changes to severance entitlements. They are the issues that were focussed on; otherwise the agreement was compared with the prior. There was no contrast of the award provisions to the agreement provisions. 33
e) Employees fully appreciated the conditions of employment that they held prior to the approval of the agreement. 34
f) There is no obligation in the legislation which specifies a requirement to compare the agreement terms with the award terms when providing that explanation. 35
g) This case relates to four reasonably long term employees who have an intimate working knowledge of the existing enterprise agreement and very little, if any, understanding or working knowledge of the award provisions. The explanation in that instance must take into account the circumstances, and those circumstances are that the explanation of the terms of the agreement would be best served as a reference to their current terms and conditions of employment. That is what they understood and that is what they worked under. 36
h) Downer Blasting met the requirement to explain the impact of the terms of the proposed agreement by way of reference to their existing terms and conditions of employment. We reject an outright obligation on employers to take steps to compare and contrast enterprise agreements to underlying reference instruments. 37
 Mr Bukarica also adduced evidence from Mr Michael Morris, Leading Hand. During the proceedings, Mr Morris gave the following evidence:
a) His understanding of the BOOT assessment is a comparison between the current and previous Enterprise Agreement. 38
b) He stated in relation to what Mr Goos explained to him in relation to the operation of the Award that “I don't believe we went into the award too much because to my recollection we go under the EA.” 39
c) He believed that it was unnecessary for Mr Goos to explain the comparison between the Agreement and the Award because “we go under the EA not the award.” 40
d) In the 8 years that he has been employed by the Applicant he has been employed in accordance with an Enterprise Agreement. 41
 Mr Goos made the following closing statements:
PN229: “Commissioner, this matter relates to a question primarily as to whether or not the employer took all reasonable steps to explain the terms of the agreement and the impact of those terms. There is no obligation in the legislation which specifies a requirement to compare the agreement terms with the award terms when providing that explanation. We accept that in instances where there have been cases most notably recently regarding One Key 42 and other such cases where they are dealing with new conditions of employment or new industries or new awards there must be some reference point for the explanation of those terms. However this case is very different.”
PN230: “This case relates to four reasonably long term employees who have an intimate working knowledge of the existing enterprise agreement and very little, if any, understanding or working knowledge of the award provisions. The explanation in that instance must take into account the circumstances, and those circumstances are that the explanation of the terms of the agreement would be best served as a reference to their current terms and conditions of employment. That is what they understood and that is what they worked under.”
PN231: “We say we have met the requirement to explain the impact of the terms of the proposed agreement by way of reference to their existing terms and conditions of employment. We reject an outright obligation on employers to take steps to compare and contrast enterprise agreements to underlying reference instruments. That may be a consideration for the - it is a consideration for the Commission but not is what is called up for employers in 180(5). We say that the explanation given to employees in this case exceeded our obligations in that all four employees had attended the bargaining meetings, all four employees had had three opportunities to hear from the company in relation to those terms and to have full appreciation for the need and reason and rationale for the changes to their enterprise agreement.”
PN232: “That is that the business was unable to secure new work and that those employees had accepted there ought to be changes to the current terms and conditions to make the business more competitive in order to win more work. Those employees had a mind to long term employment with the applicant and looking to grow in the business with that employer. In that context we say the explanation was reasonable. We say also that the other steps required under the Fair Work Act have been met and that there is otherwise no reason why the agreement should not be approved in the circumstances.”
 Mr Bukarica made the following oral submissions:
PN235: We submit that the Commission cannot be satisfied that the proposed agreement meets the relevant statutory tests. As the submissions articulate in some detail there are very significant problems with the applicant being able to satisfy the BOOT and these matters are summarised in particular at page 26 of our original submissions.
PN236: It might be said that some of these detriments could be satisfied by way of undertakings and that is a matter for the Commission to consider. The fact remains however there are no undertakings being identified or proposed to the Commission at present and in our view there would be a need for multiple undertakings relating to multiple less beneficial terms that have been identified.
PN236: What we say is clear based on the evidence of Mr Goos and Mr Morris now, and even in terms of the concessions that are contained in the submissions filed by the company, it's clear that the company failed in a fairly basic obligation in terms of the requirements under section 180(5) and that is to identify the relevant less beneficial terms in the agreement relevant to the award.
PN238: Now true it is that that particular requirement is not spelt out in specific words in the Act but as the court, the Full Court of the Federal Court observed in the One Key appeal decision which is cited, the whole purpose of the relevant provision, section 180(5) and section 188, is concerned with giving employees an informed or a basis to make an informed decision about an enterprise agreement and it's simply not good enough to say "Well, you know, in this particular place the reference point is the previous enterprise agreement". 43
PN239: The point we make simply is that a company with the resources of Downer should have been able to put together a comparative table or some sort of summary document, which I see routinely in many enterprise agreements as I'm sure the Commission would as well, simply setting out the relevant differences and in particular any significant diminutions in award benefits. Now we say that's a reasonable step. That's a reasonable step that should have been taken. This is not a 12 employee small operation. It's a major operator in the coal mining industry.
PN240: We think that failure is fatal to the application, with respect. It can't be said that employees made an informed decision or that the objectives or the purpose of section 180(5) was met in these proceedings and we ask the Commission, with respect, to not approve the agreement.
 In reply Mr Goos submitted that:
PN257: Thank you, Commissioner, and in my reply I reiterate that the Act as conceded by the respondent does not specify the requirement to have regard to the award in the explanation of the agreement. That is not appropriate in the circumstances where employees have no - there was no bearing of the award to their employment. I will also respond to the point made by the respondent that the employees were at all times informed of our strategy and at all times informed of the impact and meaning of the terms of the agreement that they were agreeing to by way of reference to the enterprise agreement which they are covered by. That is the appropriate reference for these employees, not an exterior document which has no basis other than as a statutory stepping stone to implement the enterprise agreement.
PN258: We say that the agreement has some elements which could be improved by way of undertakings and we do not agree with the CFMMEU's position that undertakings would not be appropriate in this case. We say that where there are small changes which can be improved through undertakings, we're willing to do so and we've identified a number of those areas in our submission, and we would work with the Commission and with the - or with the Commission in order to identify and provide those undertakings.
 In Falcon Mining Deputy President Asbury observed that the FW Act “does not stipulate the manner in which an explanation of the terms of an Agreement must be provided…” 44 Her Honour continued,
“ As a Full Bench of the Commission observed in McDonalds, s.180(5) of the Act does not establish an absolute requirement that a particular outcome be achieved, but requires only that the employer take reasonable steps to ensure that the terms and conditions of the Agreement are explained to employees. The reasonableness of the steps taken must be considered in the context of:
• The size of the employer;
• The resources of the employer including available mechanisms and available expertise to provide an explanation;
• The role and qualifications of the persons who provide the explanation; and
• Whether the capacity or the ability of employees to receive an explanation is impacted by issues such as language, literacy, access to electronic media, hours of work, rosters, the locations at which work is performed, travel to and from remote locations or the availability of employees to receive an explanation.
 In the present case, I am not satisfied that reasonable steps were taken to give employees an explanation of the terms of the Agreement and the effect of those terms. On the basis of the evidence of Mr Ryan, I am satisfied that there were employees working rosters that would likely have impacted on or prevented them from attending meetings at which the terms of the Agreement and their effect were explained. I am also satisfied that Ms Gayton did not take steps to address this lack of access, on the basis that she was not aware that employees were working such rosters at the relevant time.
 I am also of the view that the error in the Form F17 Employer declaration, where it is wrongly stated that there are no terms of the agreement less beneficial than those in the Award, makes it more probable than not that Ms Gayton made comments to this effect during her explanation about the terms of the Agreement. While I accept that the incorrect statement was unintentional, and that Ms Gayton did not set out to mislead the Commission or employees when she made that statement, the provision of incorrect information in a statutory declaration is a matter I can take into account in deciding whether the Agreement was genuinely agreed. I also note that while swearing an affidavit acknowledging the error, Ms Gayton has not provided any statement as to what terms of the Agreement are less beneficial when compared to the terms of the Award and there is insufficient evidence upon which I could reasonably be satisfied that an explanation addressing this matter was provided to employees.
 In my view the entirety of the failure to comply with requirements for approval of the Agreement – failure to correct typographical errors in the NERR (despite two attempts); failure to establish that reasonable steps were taken to give the NERR to employees (despite being given numerous opportunities to provide evidence to that effect); the incorrect statement about less beneficial terms of the Agreement in the Form F17 Employer Declaration; failure to properly correct that statement and to provide particulars; failure to provide particulars about the terms of the Agreement which are less beneficial than those in the Award; and Mr Ryan’s evidence about the inadequacy of the explanation of the terms of the Agreement – are reasonable grounds for believing that reasonable steps were not taken to explain the terms of the Agreement and their effect, and that the Agreement was not genuinely agreed.
 In Shamrock the Full Bench observed that,
 Satisfaction under s.186(2)(a) is a jurisdictional prerequisite for the approval of any enterprise agreement. If s.180(5) is not satisfied, then the Commission cannot be satisfied re: s.188 (a)(i) and consequently the Commission cannot be satisfied that the Agreement has been ‘genuinely agreed’ as required by s.186(2)(a).
 The meaning of s.180(5) and what is required, particularly in regards to s.180(5)(a) was subject to detailed consideration in the recent decision of his Honour Justice Flick in the One Key decision and reasoned as follows:
“… A failure to comply with a “[p]re-approval requirement”, in this case the failure to “take all reasonable steps” for the purposes of s 180(5), precluded the proposed Agreement from being an agreement susceptible of subsequent approval by the Commission. And a failure to take the necessary steps to secure the agreement of those “employees covered by the agreement” (s 186(2)(a)) – be it genuine agreement or otherwise – again precluded the proposed Agreement from being an agreement in respect to which the Commission need reach any state of satisfaction.”
… Section 180(5) is not a section which is expressed in terms of whether the Commission is “satisfied” that “all reasonable steps” have been taken. That subsection is expressed as a statement of objective fact as to that which must occur before approval is sought. If “all reasonable steps” have not in fact been taken, the Commission lacks power to “approve” the agreement.”
 The requirement imposed by s 180(5) to “take all reasonable steps to ensure that … the terms of the agreement, and the effect of those terms, are explained” is an important obligation imposed upon an employer to ensure that employees are as fully informed as practicable. The requirement is not a mere formality. Whatever steps may be necessary will depend upon the facts and circumstances of each particular case; but those steps are not satisfied by a person reading – without explanation – the terms of an agreement to an employee.”
 Like the Full Bench in Shamrock I agree with and, with respect, adopt his Honour’s reasoning in One Key (which was not disturbed on appeal). 45
 Downer Blasting filed a Form F17 statutory declaration with its application for approval of the Agreement. Question 3.5 of the Form F17 statutory declaration filed with the application for approval of the Agreement asks the employer the following question “does the agreement contain any terms that are less beneficial than equivalent terms and conditions in the reference instrument(s) listed in questions 3.1 and 3.2 and/or does the agreement confer any entitlements that are not conferred by those reference instruments?”. Like in Shamrock, in the present matter, Downer Blasting answered “No”.
 In Shamrock the Full Bench held that,
“ In this matter, the Applicant answered “no” in respect to questions 3.5 and 3.6 of the Form F17 stating that there were no more beneficial terms or less beneficial terms in the Agreement compared to the Award. It is patently clear that both answers do not accord with the factual situation. The reality is that there are some more beneficial terms in the Agreement, for example higher base rates of pay. It is also apparent that there are a significant number of less beneficial terms. In the Decision at first instance the Commissioner considered a number terms of the Agreement which the CFMEU considered to be less beneficial and other issues identified by the Commission in its initial assessment of the Agreement. The Commissioner did not consider a number of the terms identified by the CFMEU to be a detriment to employees. However, the Commissioner found that no requirement in the consultation term to provide written information, entitlements for shiftworkers, redundancy, meal breaks and rest periods, the absence of a minimum engagement on Saturdays and public holidays, reduced notice of annual shut down and averaging of hours over a 12 month period were either detrimental to employees or may result in scenarios where employees may be worse off under the Agreement. A number of undertakings were sought to satisfy the Commissioners concerns in relation to the BOOT.
 It is important to note that the Form F17 is a statutory declaration as to what the Applicant declares that they have done to satisfy the various requirements of the legislation. While in some circumstances an Applicant will incorrectly answer question 3.4 and/or question 3.5 because they have omitted one or some items from the list, and because the omitted items are not particularly significant this may not necessarily be a cause for concern. However, in this case a declaration that there are no less beneficial terms does give rise to concern as it is apparent that in fact there were a significant number of less beneficial terms. Aside from the obvious concern that the declarant has made a declaration which is untrue, it gives rise to a further concern as to the nature of the explanation given to employees as to terms of the Agreement and the effect of those terms. That is, it at least raises a real question as to the explanation to employees about the terms of the Agreement and in particular the effect of those terms, in circumstances where the employer is attesting that the agreement has no less beneficial terms.
 We are of the view that where the answer to the question less beneficial terms’ was so clearly at odds with the factual situation, this should have led to the Commissioner to make further enquiries. While we understand the focus of the CFMEU during the proceedings was not on that aspect, this does not alter the fact that the Commissions statutory obligation is to properly assess all of the approval requirements, to the standard set by Justice Flick. We have sympathy for the fact that the decision in One Key was not handed down until after the approval of this Agreement.
 As we have mentioned, the Respondent has made further submissions regarding the explanation provided to the relevant employees in this case. Those submissions are set out above. We note that the Respondent submits and we accept that the employees were aware that they were covered by the Building and Construction General On-Site Award 2010. We also accept that some Award clauses and Agreement clauses were compared. We also accept that the knowledge and experience of employees is relevant when determining whether the employer has taken ‘reasonable steps’. However, importantly, the Respondent concedes that “The CSM [Corporate Services Manager] did mention that the Award and NES formed the baseline and that nothing in the Agreement would be less than what they were entitled to under the Award or NES. And at the time the CSM believed this to be the case”.
 However, it is apparent that there are in fact a number of significant reductions in the Award entitlements. In light of the concession, it is apparent that the explanation to employees was quite simply, wrong. We accept that an explanation of the terms of the Agreement and the effect of those terms to employees may not be perfect and may, depending on the circumstances, still satisfy the requirement of s.180(5) of the Act. However, an explanation which is clearly misleading (as in this case) cannot possibly meet the requirement. We note that the Commissioner did not have the benefit of the additional submissions and the concession.
 Where the Commission is provided with a statutory declaration which is at odds with the real position in important respects, a number of practical difficulties can be raised in determining an application for approval. The applicant stated in its application that there were no reductions on the award when in fact there were, which gradually became apparent during the proceedings at first instance. Such an employer understanding would presumably lead it to provide the same misleading explanation to employees, and it is now conceded by the employer that this was the case. As in this present matter this may well have implications in many proceedings for the question of whether or not there was genuine agreement within s.186(2)(a), and therefore whether the agreement can be approved, which the Commission must endeavour to examine in greater detail as the real facts become apparent.
 In the circumstances we conclude that the Commissioner erred in concluding that the requirements of s.180(5) of the Act were met. Satisfaction of the requirements under s.186(2)(a) is a jurisdictional prerequisite for the approval of any enterprise agreement. If s.180(5) is not satisfied, then the Commission cannot be satisfied of the requirements of s.188(a)(i). Consequently the Commission cannot attain satisfaction of the requirement at s.186(2)(a). For these reasons we uphold this ground of appeal.
 I agree with and, with respect, adopt the reasoning of the Full Bench in Shamrock.
 Most recently in One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union 46 a Full Court of the Federal Court Australia provided further instruction about what the Commission is required to consider to reach the requisite state of satisfaction that s.180(5) has been complied with. It held,
“112 … the Commission was required to consider the content of the explanation and the terms in which it was conveyed, having regard to all the circumstances and needs of the employees and the nature of the changes made by the Agreement. It is true that the Act does not expressly say that. But the question of whether an administrative decision-maker is required to consider a matter is not determined only by the express words of the Act; it may also be determined by implication from the subject-matter, scope and purpose of the Act: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39–44 (Mason J).
113 A consideration of the subject-matter, scope and purpose of the relevant provisions of the Fair Work Act indicates that the content of the explanation and the terms in which it was conveyed were relevant considerations to which the Commission was bound to have regard. The absence of that information meant that the Commission was not in a position to form the requisite state of satisfaction. Put differently, without knowing the content of the explanation, it was not open to the Commission to be satisfied that all reasonable steps had been taken to ensure that the terms and their effect had been explained to the employees who voted on the Agreement or that they had genuinely agreed to the Agreement.
114 The following considerations point inexorably to that conclusion.
115 The Commission was required to be satisfied that OKW had taken “all reasonable steps to ensure” that both the terms and the effect of the terms had been explained to the relevant employees as an element in the inquiry as to whether “genuine” agreement had been obtained from them. The agreed purpose of the obligation imposed on employers by s 180(5) is to enable the relevant employees to cast an informed vote: to know what it is they are being asked to agree to and to enable them to understand how wages and working conditions might be affected by voting in favour of the agreement.
116 In order for the employer to comply with the obligation it must take into account the particular circumstances and needs of those employees, including their cultural and linguistic backgrounds, their youth, and the absence of a bargaining representative. That is made explicit in s 180(6). How could the Commission decide whether the steps the employer had taken were “all reasonable steps” unless it knew what the employees had been told before they cast their votes? Without knowing the terms in which the explanation had been conveyed how could the Commission form an opinion on the sufficiency of the explanation, particularly having regard to the considerations mentioned in s 180(6)? Ultimately, how could the Commission decide that a genuine agreement had been reached without having evidence upon which it could answer both these questions?
 I agree with and, with respect, adopt the reasoning of the Full Court in One Key.
 In the present matter the relevant context is that:
a) Downer Blasting is a very large company or group of companies; 47
b) The resources of Downer Blasting (including available mechanisms and available expertise to provide an explanation) were sufficient; 48
c) The explanation was provided by Jarrett Goos. He has a senior role as Group Employee Relations Manager. He holds a Bachelor of Commerce (Labor and Industrial Relations) and Bachelor of Behavioral Science (Labor and Industrial Relations). He is an experienced industrial relations practitioner with the skills and ability to explain an agreement with reference to the Modern Award; and
d) the capacity or the ability of employees to receive an explanation was not impacted by issues such as language, literacy, access to electronic media, hours of work, rosters, the locations at which work is performed, travel to and from remote locations or the availability of employees to receive an explanation. 49
 In the present matter the evidence establishes that:
a) There were a number of bargaining meetings. At those meetings those in attendance went through the Agreement. No notes were taken of those discussions.
b) As a result of those meetings the Agreement was amended. It was last presented on 8 February 2018. That is to say, that is the only meeting that the Agreement (in its present form) was discussed or explained. No notes were taken of the meeting. It is not known exactly what was explained to employees. Downer Blasting has had every opportunity to put on evidence about what was explained.
c) It seems that most of the explanation focussed on comparing the Agreement with the predecessor agreement. However, the predecessor agreement is not the reference instrument. It is not the instrument relevant for the BOOT. It is not the instrument asked about in the F17.
d) What is known is that there was no explanation of the effect of the Agreement in relation to the Modern Award. It is not mandatory that this be the case. However, it is to be assessed on a case by case basis.
e) Downer Blasting did not employ employees who might have special requirements (e.g. because they were from culturally or linguistically diverse backgrounds) to be considered when it came to explaining the Agreement. There were no impediments (e.g. rostering) to the employees/bargaining representatives attending the meetings. They were not young people.
f) Downer Blasting is a part of a group of companies. It is part of a large group of employers. It is an experienced industrial player with a long history of negotiating enterprise agreements. It is well resourced.
g) The Agreement contains terms that are less beneficial to employees when compared to the Modern Award. I am satisfied that the following terms are less beneficial (or arguably so):
i. Clause 2.8 - Inclusion in the Agreement of a term that is not in the Award. Inclusion of casual employment.
ii. Clause 2.8 - Averaging hours for part time employment.
iii. Clause 2.9 - Requirement to give 2 weeks' notice of termination or forfeit 2 weeks' pay. This is conceded by Downer Blasting.
iv. Clause 2.9 - Loss of entitlement to payment of personal leave on termination. This is conceded by Downer Blasting.
v. Clause 2.9 - Loss of entitlement to remain on personal leave upon termination. This is conceded by Downer Blasting.
vi. Clause 2.14 - Obligation to take annual leave or leave without pay during a shut down.
vii. Clause 2.14 - New employees not entitled to notice of a shut down.
viii. Clause 2.14 - Loss of continuity of service if stood down during a shut down.
ix. Clause 2.14 - Loss of entitlement to a public holiday that falls during a shut down.
x. Clause 3.3 - No definition of night shift for shift allowance purposes. Although this could have been addressed in an undertaking.
xi. Clause 3.3 - No entitlement to an afternoon shift allowance. Although this could have been addressed in an undertaking.
xii. Clause 3.3 - No payment of shift penalty for 6 and 7-day shift workers performing overtime during an afternoon or night shift. Although this could have been addressed in an undertaking.
xiii. Clause 3.3 - No penalty payment when a day worker is temporarily moved from day work to shift work.
xiv. Clause 3.6 - Loss of entitlement to penalties when an employee is moved from one place on the roster to another place.
xv. Clause 4.4 - Loss of entitlement to determining start and finishing point.
xvi. Clause 4.5 - Loss of entitlement to award based meal breaks.
xvii. Clause 4.6 - No defined overtime for a 6-day shift worker or alternatively a lower overtime rate than in the Award. Lack of clarity conceded by Downer Blasting.
xviii. Clause 4.6 - No entitlement of time off instead of overtime.
xix. Clause 4.7 - A reduction in the minimum payment for a call back. Conceded by Downer Blasting.
xx. Clause 5.1 - Loss of protections with respect to the taking of annual leave. Almost conceded by Downer Blasting who say it is “not significantly different”.
xxi. Clause 5.8 - Loss of entitlement to no deduction of personal leave when absence is less than half a shift.
xxii. Clause 5.8 - Reduction in the penalty rate when working ordinary hours or overtime on a public holiday. Conceded by Downer Blasting.
h) Downer Blasting failed to identify these less beneficial terms in the F17.
i) It can be concluded that Downer Blasting failed to explain these less beneficial terms to employees before they voted on the Agreement.
j) The wages provided for in the Agreement for new employees are only marginally higher than those in the Modern Award. They constitute a reduction in the wages provided for in the predecessor agreement. Although existing employees (those who voted on the Agreement) had their wages “grand-fathered”. In this context, when the benefit of the Agreement might be said to only marginally better than the Modern Award it becomes more relevant that employees understand the terms that are less beneficial than the Modern Award.
k) Noting all of the above, and the fact that Downer Blasting is a sophisticated industrial player, it would have been reasonable for it to take steps to explain to employees the terms of the Agreement that were less beneficial than the Modern Award. It did not do so.
 It is important to note that in finding that the above terms were less beneficial I make no finding about whether, consequently, the Agreement would have failed to pass the BOOT. That is a different test. I identify the less beneficial terms only in the context that they were not explained to employees. That may not always be necessary were the wages are so significantly higher than the Modern Award that the wages “buy out” the less beneficial terms. But that is not the case in the present matter. The wages are not so significantly higher for new employees. Accordingly, it would have been reasonable for Downer Blasting to explain the less beneficial terms in order to ensure that the vote meant that the employees were genuinely agreeing to the Agreement. In the absence of such an explanation I am not satisfied the Agreement was genuinely agreed to.
 For the reasons above I have concluded that I am not satisfied that Downer Blasting took all reasonable steps to ensure that the terms of the Agreement and the effect of those terms [were] explained to the relevant employees. Consequently, Downer Blasting did not comply with the pre-approval step mandated by section 180(5)(a). For this reason the Agreement cannot be approved. The Application for approval is dismissed. An Order to that effect will be issued with this decision.
 Having decided that the Agreement cannot be approved because the mandatory pre-approval steps were not complied with, it is not necessary for me to consider and determine the remainder of the objections raised by the CFMMEU.
Mr J Goos for the Applicant
Mr A Bukarica for the CFMMEU
26 July 2018
1 Submissions (CFMMEU) 6 July 2018, at 1-2
2 Submissions (Applicant) 13 July 2018 at 1
3 Submissions (CFMMEU) 6 July 2018, at 1-2
4  FWC 5315
5  FCAFC 77
6  FWCFB 1772
7  FWC 5315
9 Waternish Engineering Pty Ltd  FWC 153
10 Site Fleet Services Pty Ltd 
11  FWCFB 1772 at 
12 Waternish Engineering Pty Ltd  FWC 153
13 Submissions (Applicant) 13 July 2018
14 Armacell Australian Pty Ltd,  FWAFB 9985
15  FCAFC 77
16 [2018) FCAFC 77 at PN  The Court's discussion on casual employment in the matter before it can be
found at PN -
17 Link Mining Services Pty Ltd., [2016) FWC 8910 @ PN 
18  FWCFB 2887 at PN 
19  FWCFB 2887 at PN 
20 Teys Australia Beenleigh Pty Ltd v AM lEU (no 2)  FCA 2 at PN 
21  FWCFB 3500
22  FWCFB 1833 at PN -(147]
23 Link Mining Services Pty Ltd.,  FWC 8910 at PN -, Moolarben Coal Operations Pty Ltd., 
FWCA 2010 at PN [26 (b) (iii)], 
24 Lobethal Abattoirs Pty Ltd T/A Thomas Food International,  FWC 151 at PN 
25 Waternish Engineering Pty Ltd., [2017) FWC 153 at PN  (dot point 2)
26 Loaded Rates Agreements,  FWCFB 3610 at PN [115 (3)]
27 Submissions (CMFMMEU) 6 July 2018 at 1-35
28 Statement of Mr J Goos, 13 July 2018
29 Statement of Mr M Morris, 13 July 2018
30 Transcript PN 30
31 Transcript PN 231
32 Transcript PN 89
33 Transcript PN 88
34 Transcript PN 126
35 Transcript PN 229
36 Transcript PN 230
37 Transcript PN 231
38 Transcript PN 162
39 Transcript PN 168
40 Transcript PN 168
41 Transcript PN 199
42  FCAFC 77
43  FCAFC 77
44  FWC 5315 at 
45 One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union  FCAFC 77
46  FCAFC 77
47 Transcript PN26
48 Transcript PN30
49 Transcript PN120
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