[2018] FWCFB 2485 [Note: An application relating to this matter has been filed in the Federal Court - Refer to the Federal Court decision of 1 March 2019 for the result of this matter.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.604—Appeal of decision

ALDI Foods Pty Limited as General Partner of ALDI Stores (A Limited Partnership)
v
Shop, Distributive and Allied Employees Association; National Union of Workers; Transport Workers’ Union of Australia
(C2018/162)

ALDI Foods Pty Limited
v
Shop, Distributive and Allied Employees Association; National Union of Workers; Transport Workers' Union of Australia
(C2018/166)

VICE PRESIDENT HATCHER
DEPUTY PRESIDENT DEAN
COMMISSIONER HUNT

SYDNEY, 31 MAY 2018

Appeal against decisions [2017] FWC 6956 and [2017] FWC 6958 of Deputy President Bull at Perth on 22 December 2017 in matter number AG2016/1058 and AG2016/6335

Introduction and background

[1] ALDI Foods Pty Limited (Aldi) has applied for permission to appeal and appealed, pursuant to s 604 of the Fair Work Act 2009 (FW Act), two decisions made by Deputy President Bull on 22 December 2017. Both decisions concerned applications made by Aldi for the approval of enterprise agreements. In one decision, the Deputy President dismissed the application for approval of the Aldi Derrimut Agreement 2016 (Derrimut Agreement) 1 and in the other he dismissed the application for approval of the ALDI Minchinbury Agreement 2016 (Minchinbury Agreement).2 In both cases the dismissal of the application was for the reason that Aldi had not issued a Notice of Employee Representation Rights (NERR) in conformity with the requirements in s 174 of the FW Act and, accordingly, the Deputy President could not be satisfied that s 188(a)(ii) had been complied with and therefore could not be satisfied that the agreement had been genuinely agreed to for the purposes of s 186(2)(a). The decisions in each case followed earlier interim decisions in which it had been determined that the NERRs did not comply with s 174,3 but the final decisions had been deferred to await the outcome of High Court proceedings which it was thought might affect the outcome of applications for approval of the agreements. As discussed later in this decision, the High Court proceedings in question did not deal with the NERR issue, with the result that the Deputy President proceeded to issue the decisions the subject of these appeals. Aldi’s appeal proceed on the basis that the Deputy President erred in each decision in concluding that NERRs which it issued did not comply with s 174 of the FW Act, and consequently erred in not approving the agreements.

[2] The statutory regime for enterprise bargaining is set out in Pt 2-4 of the FW Act. Division 3 of Pt 2-4 contains requirements pertaining to the process of bargaining for enterprise agreements and representation during bargaining. Section 173(1) requires an employer that will be covered by a proposed enterprise agreement that is not a greenfields agreement to take all reasonable steps to give notice of the right to be represented by a bargaining representative (the NERR) to each employee who will be covered by the agreement and is employed at the “notification time” for the agreement. “Notification time” is defined in s 173(2) and, broadly speaking, encompasses the various circumstances contemplated by the FW Act as to when bargaining for an agreement may commence. Section 173(3) requires the NERR to be given as soon as practicable and not later than 14 days after the notification time for the agreement.

[3] Section 174 concerns the content and form of the NERR as follows:

174 Content and form of notice of employee representational rights

Application of this section

(1) This section applies if an employer that will be covered by a proposed enterprise agreement is required to give a notice under subsection 173(1) to an employee.

Notice requirements

(1A) The notice must:

(a) contain the content prescribed by the regulations; and

(b) not contain any other content; and

(1B) When prescribing the content of the notice for the purposes of paragraph (1A)(a), the regulations must ensure that the notice complies with this section.

Content of notice—employee may appoint a bargaining representative

(2) The notice must specify that the employee may appoint a bargaining representative to represent the employee:

(a) in bargaining for the agreement; and

(b) in a matter before the FWC that relates to bargaining for the agreement.

Content of notice—default bargaining representative

(3) If subsection (4) does not apply, the notice must explain that:

(a) if the employee is a member of an employee organisation that is entitled to represent the industrial interests of the employee in relation to work that will be performed under the agreement; and

(b) the employee does not appoint another person as his or her bargaining representative for the agreement;

the organisation will be the bargaining representative of the employee.

Content of notice—bargaining representative if a low-paid authorisation is in operation

(4) If a low-paid authorisation in relation to the agreement that specifies the employer is in operation, the notice must explain the effect of paragraph 176(1)(b) and subsection 176(2) (which deal with bargaining representatives for such agreements).

Content of notice—copy of instrument of appointment to be given

(5) The notice must explain the effect of paragraph 178(2)(a) (which deals with giving a copy of an instrument of appointment of a bargaining representative to an employee’s employer).

[4] Division 4 of Pt 2-4 deals with the approval of enterprise agreements by the Commission. Relevantly, s 186(2)(a) provides that an approval requirement for a non-greenfields agreement is the Commission’s satisfaction that the agreement “has been genuinely agreed to by the employees covered by the agreement”. Section 188 sets out matters about which the Commission must be satisfied in order that the s 186(2)(a) requirement is met, and they include (in s 188(a)(ii)) that the employer covered by the agreement has complied with the requirement in s 181(2). Section 181(2) requires that the employer not request, pursuant to s 181(1), that the employees employed at the time who will be covered by the agreement approve it by voting for it until at least 21 days after the day on which the last NERR under s 173(1) is given.

[5] Regulation 2.05 of the Fair Work Regulations 2009 (FW Regulations) prescribes the form in Schedule 2.1 as the NERR for the purpose of s 174 of the FW Act. The form in Schedule 2.1 prescribed as at the notification times for the Derrimut Agreement and the Minchinbury Agreement, in its entirety, is as follows:

Notice of employee representational rights

(regulation 2.05)

Fair Work Act 2009 , subsection 174(6)

[Name of employer] gives notice that it is bargaining in relation to an enterprise agreement ([name of the proposed enterprise agreement]) which is proposed to cover employees that [proposed coverage] .

What is an enterprise agreement?

An enterprise agreement is an agreement between an employer and its employees that will be covered by the agreement that sets the wages and conditions of those employees for a period of up to 4 years. To come into operation, the agreement must be supported by a majority of the employees who cast a vote to approve the agreement and it must be approved by an independent authority, Fair Work Commission.

If you are an employee who would be covered by the proposed agreement:

You have the right to appoint a bargaining representative to represent you in bargaining for the agreement or in a matter before Fair Work Commission about bargaining for the agreement.

You can do this by notifying the person in writing that you appoint that person as your bargaining representative. You can also appoint yourself as a bargaining representative. In either case you must give a copy of the appointment to your employer.

[If the agreement is not an agreement for which a low-paid authorisation applies--include:]

If you are a member of a union that is entitled to represent your industrial interests in relation to the work to be performed under the agreement, your union will be your bargaining representative for the agreement unless you appoint another person as your representative or you revoke the union's status as your representative.

[If a low-paid authorisation applies to the agreement--include:]

Fair Work Commission has granted a low-paid bargaining authorisation in relation to this agreement. This means the union that applied for the authorisation will be your bargaining representative for the agreement unless you appoint another person as your representative, or you revoke the union's status as your representative, or you are a member of another union that also applied for the authorisation.

[if the employee is covered by an individual agreement-based transitional instrument--include:]

If you are an employee covered by an individual agreement:

If you are currently covered by an Australian Workplace Agreement (AWA), individual transitional employment agreement (ITEA) or a preserved individual State agreement, you may appoint a bargaining representative for the enterprise agreement if:

* the nominal expiry date of your existing agreement has passed; or

* a conditional termination of your existing agreement has been made (this is an agreement made between you and your employer providing that if the enterprise agreement is approved, it will apply to you and your individual agreement will terminate).

Questions?

If you have any questions about this notice or about enterprise bargaining, please speak to either your employer, bargaining representative, go to www.fairwork.gov.au, or contact the Fair Work Commission Infoline on [insert number].

[6] It is not in dispute that the NERRs issued by Aldi at the notification times for the Derrimut Agreement and the Minchinbury Agreement departed from the prescribed form for the NERR. In the last paragraph, Aldi substituted the word “leader” for employer.

[7] In Peabody Moorvale Pty Ltd v Construction, Forestry, Mining and Energy Union 4 a five-member Full Bench of the Commission determined the following (as summarised in the subsequent Full Bench decision in Maritime Union of Australia v MMA Offshore Logistics):5

(1) Section 174(1A) established a clear and unambiguous requirement that the form and content of the NERR had to be as set out in the template provided for in the FW Regulations.

(2) There was no capacity to depart from the template in the FW Regulations. The Commission accepted the submission of the Commonwealth Minister for Employment that “A mandatory template is provided in the Regulations. The provisions make it clear that there is not scope to modify either the content or the form of the Notice other than as set out in the template.”

(3) A failure to comply with the form and content requirement in s 174(1A) renders the NERR invalid.

(4) The consequence of failing to give a valid NERR is that the Commission cannot approve any subsequent enterprise agreement that is made. That is because the requirement in s181(2) that an employer not request employees to approve a proposed enterprise agreement until at least 21 days have passed since the last NERR was issued presupposes that the NERR is valid. If it is not, s 180(2) has not been complied with. The paragraph (a)(ii) element of the “genuinely agreed” definition in s 188 cannot therefore be satisfied, and accordingly the “genuinely agreed” approval requirement in s 186(2)(a) cannot be satisfied.

[8] In Shop, Distributive & Allied Employees Association v ALDI Foods Pty Ltd 6 a Full Court of the Federal Court (Jessup, Katzmann and White JJ) considered a challenge, mounted by the Shop, Distributive and Allied Employees Association (SDAEA) on a number of grounds, to the validity of the approval by the Commission of another enterprise agreement in relation to which Aldi was the employer. One of the grounds of the challenge was that the NERR for the agreement, as here, did not conform to the prescribed form in that the word “leader” had been substituted for “employer” in the last paragraph. The Full Court majority (Katzmann and White JJ, Jessup J dissenting) determined that the agreement was invalidly approved on a different ground. In relation to the NERR issue, Jessup J said:

“[43] In Peabody Moorvale Pty Ltd v Construction, Forestry, Mining and Energy Union [2014] FWCFB 2042; (2014) 242 IR 210, a Full Bench of the Commission held that compliance with the form prescribed for the purposes of s 174(1A) of the FW Act was mandatory, and that a failure to comply would invalidate the notice. In such a case, there would be no reference point for the operation of s 181(2) – which requires that the employer’s request to employees to approve a proposed agreement not be made until at least 21 days after the s 173 notice – and the Commission could not, therefore, be satisfied of the matter specified in s 188(a)(ii), with the result that it could not be satisfied that the agreement was genuinely agreed to by the employees concerned for the purposes of s 186(2)(a).

[44] In the applicant’s submission, we should follow Peabody and hold that the agreement was not such as the Commission could approve under s 186 of the FW Act.

[45] The difficulty with that submission is that it treats compliance with s 174(1A) as a jurisdictional fact apropos the approval of the putative enterprise agreement which follows from the bargaining process in question. That is not the case. As the Commission’s reasoning in Peabody demonstrates, ultimately compliance with s 174(1A) is something of which the Commission must be satisfied. It is a matter left to the decision of the Commission itself. It is true, of course, that, if the Commission’s decision on the matter in a particular case proceeded on a legally erroneous reading of the requirements of s 174(1A), that may open the way to an application of the kind that the applicant presently makes in other departments of this case. But that did not happen here, for the very reason that no-one submitted, either to Bull DP or to the Full Bench, that the requirements of s 174(1A) had not been complied with.

[46] What appears to have happened is that, subsequently to the decision of the Full Bench, ALDI itself brought this minor terminological departure of the notice of employee representational rights which it was accustomed to use from the form prescribed in the regulations to the attention of the Commission, and sought to make the necessary correction in relation to a notice used in the setting of a different enterprise agreement altogether. Taking note of this development as it did, the applicant adopted the point as its third ground in this proceeding. It justifies its failure to raise the point before the Full Bench on the basis that, at the time, it was not aware of what it now says was a mistake in the terms used in ALDI’s notice.

[47] I would not accept that justification. The applicant sought, and was granted, the right to appeal from the decision of Bull DP, and proceeded to prosecute an appeal on grounds of its own choosing. It seems to have made productive use of such procedures as were available to require ALDI to produce documents to sustain those grounds. It did not challenge the notice of employee representational rights. That too was its own choice. The Commission having completed its statutory task, with the assistance of the applicant’s contribution, it is now too late for the applicant to say that it has since uncovered (by whatever means) a new argument which it might have put, but which it did not put, to the Full Bench.

[48] The remedies which the applicant seeks are discretionary ones. Whatever might be the strength of its third ground considered as a legal proposition in isolation, because it does not involve a jurisdictional fact, and in the light of the procedural history of the matter to which I have referred, I would, in the exercise of the court’s discretion, decline to grant the relief sought insofar as this ground is relied on.

[49] I would make one parting observation. Ex hypothesi, an employer which resorts to s 173 of the FW Act will, in the usual case, be a corporation. Read literally, the injunction in the form in the regulations that an employee who has any questions should “speak to ... your employer” is a challenging one. If, as is contemplated, speaking is involved, one would imagine that the addressee would inevitably be a flesh and blood servant or agent. At least within reasonable bounds, for the employer to have nominated the individual to whom it intends that questions should be addressed would not, in my view, amount to a departure from the prescribed form, even if strict compliance were necessary. Had the Full Bench’s attention been drawn to the issue which the applicant now seeks to agitate, it would not, therefore, have been in error, jurisdictionally, to have read s 174(1A) as permitting the reference to “leader” as used by ALDI on the facts of the present case.”

[9] In her judgment Katzmann J declined to “join in the parting observation made by Jessup J” 7 and dealt with the NERR issue in the following terms:

“[63] Two questions arise. The first is whether, by sending a notice with this alteration, ALDI failed to comply with s 173. The second is whether non-compliance invalidates the agreement.

[64] Turning then to the first question, the substitution of the word “leader” for the word “employer” meant that the form distributed to employees was different from the form prescribed by s 174(1A)(c) and reg 2.05. It also meant that the notice did not contain the content prescribed by the regulations (contrary to s 174(1A)(a)) and contained content not prescribed by the regulations (contrary to s 174(1A)(b)).

[65] Yet ALDI submitted that it had complied with s 173 because s 25C of the Acts Interpretation Act 1901 (Cth) (“Interpretation Act”) provides that “[w]here an Act prescribes a form, then strict compliance with the form is not required and substantial compliance is sufficient”. Section 2 of the Interpretation Act, however, provides that the application of a provision of that Act to a provision of another Act is subject to a contrary intention.

[66] It may be accepted that ALDI substantially complied with the form. But in the case of s 174(1A), substantial compliance will not do. Section 25C of the Interpretation Act does not apply because the contrary intention is manifest. Nothing less than strict compliance is sufficient. This is apparent from the language of s 174(1A), which makes clear that the notice must contain no more and no less than the content prescribed by the regulations. It is also apparent from the legislative history. Section 174(1A) was introduced for the purpose of eliminating confusion about whether strict or substantial compliance was required. As the Explanatory Memorandum to the Bill which became the Amendment Act reveals (at [147]):

This amendment responds to Panel recommendation 19. The amendment is intended to eliminate confusion about whether employers may modify the content or form of the notice of employee representational rights. The amendment would make clear that the notice must contain only the content prescribed by the regulations and no other content except that which the regulations require an employer to insert or omit.

[67] The “Panel recommendation” to which this paragraph refers can be found in Towards more productive and equitable workplaces: An evaluation of the Fair Work legislation (Department of Education, Employment and Workplace Relations, Canberra, 2012). This was a full-scale review of the Fair Work legislation, commissioned by the government of the time. Recommendation 19 arose from a submission by a number of unions that modifications and additions to the prescribed form should not be permitted under the Act. Examples were given to the Panel in which it was alleged that employers had sought to encourage employees to extinguish their rights to be represented by their union. The Panel noted that the approach of what was then Fair Work Australia (now the Commission) was to require only substantial compliance with the notice requirements and said that:

The s 173 notice is an integral element in the bargaining regime. To eliminate confusion and any opportunities for malpractice, we recommend that the Government amend s 174 of the FW Act to make it clear that a bargaining notice may only contain the requirements as specified in the section and its attendant regulations.

[68] It is well established that the Court may have regard to the reports of law reform bodies to ascertain the mischief which a statute is intended to cure: CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408. Here the mischief is plain, as are the means the legislature chose to cure it. Section 174(1A) requires strict compliance. In Peabody Moorvale Pty Ltd v Construction, Forestry, Mining and Energy Union [2014] FWCFB 2042; 242 IR 210 a five-member bench of the Commission, the President presiding, came to the same conclusion. The Commission correctly observed at [19] that the meaning of s 174(1A) is “clear and unambiguous” and “consistent with the context and mischief to which the provision is addressed”.

[69] It follows that, as a result of the omission of the word “employer” and the substitution of the word “leader”, the notice was not in the prescribed form and ALDI failed to comply with s 173(1) of the FW Act (read with s 174(1)–(1A)) by giving notice in the required form.

[70] It seems to me that if ALDI’s management wished to designate an appropriate person or persons to whom questions could be directed, it could have done so by other means, for example, in an accompanying document. But in my respectful opinion s 174(1A) requires that there be no alteration in form or content. The Act does not allow for exceptions for administrative efficiency or convenience.”

[10] Katzmann J went on to conclude that it was not necessary to determine whether the Commission fell into jurisdictional error in determining that the agreement in question was genuinely agreed because relief on the NERR ground should be refused in the exercise of the Court’s discretion for the reasons given by Jessup J at paragraph [46]-[48] of his judgment (that is, that the SDAEA had not raised the NERR issue in the first instance of appeal proceedings in the Commission). 8

[11] On the NERR issue, White J said:

“[175] In my opinion, the SDA’s contention that the decision of the Full Bench is affected by jurisdictional error by reason of a defect in the NERR should be rejected. I respectfully agree with the reasons of Jessup J in [39]-[48] concerning this ground.

[176] The reasons of Katzmann J on the question of whether a notice given pursuant to s 174 must conform strictly with the prescribed form do appear to have some force, but I would prefer not to express a concluded view on that issue until it is necessary to do so.”

[12] It may be noted, as we discuss later, that White J declined to express agreement with the “final observation” in paragraph [49] of Jessup J’s judgment.

[13] In MUA v MMA Offshore Logistics 9 the Full Bench summarised the state of the law in respect of the NERR issue, in light of the Full Court’s decision in SDAEA v Aldi, as follows:

“[98] In summary no member of the Full Court expressed the view that Peabody was incorrect. Jessup J appears to have been prepared to assume that Peabody was correct for the purpose of his analysis, but stated the obiter opinion (at [49]) that, even if strict compliance with the prescribed form was required, the minor departure in the NERR issued in that case would not be sufficient to invalidate it. Katzmann J concluded expressly that Peabody was correct, and did not agree with Jessup J’s observation at [49]. White J agreed with Jessup J’s analysis of the NERR ground at [39]-[48] (but declined to express agreement with the observation in [49]), and acknowledged the force of Katzmann J’s reasoning concerning the need for strict compliance with the prescribed NERR without deciding the issue. In light of Aldi, we consider that the proper course is to follow Peabody and approach the NERR issue on the basis that a purported NERR which does not strictly comply with the prescribed form in Schedule 2.1 is invalid, and that an enterprise agreement which proceeds on the basis of an invalid NERR is incapable of approval.”

[14] In ALDI Foods Pty Limited v Shop, Distributive & Allied Employees Association 10 the High Court allowed in part an appeal against the Full Court’s decision in SDAEA v Aldi, and issued a writ of mandamus requiring the Commission to determine the SDAEA’s appeal against the approval of the Aldi agreement in question according to law. The High Court did not deal with the NERR issue however, since the SDAEA’s NERR ground had been rejected by the Full Court.

The decisions

[15] In the decision under appeal concerning the Derrimut Agreement, 11 the Deputy President said (footnotes omitted):

“[11] On 25 May 2016, the applicant’s legal representative, Enterprise Law, forwarded advice, via email, that the NERR had substituted the word ‘employer’ with the word ‘leader’ in the final paragraph of the NERR. This was presumably raised by ALDI because alterations to the content or form of the NERR notice template provided in Schedule 2.1 of the Regulations has resulted in the non-approval of enterprise agreements by some members of the Commission, relying on the reasons expressed in the Full Bench decision of Peabody Morevale Pty Ltd v Construction, Forestry, Mining and Energy Union (Peabody).

[12] In Peabody, a Full Bench of the Commission held that compliance with the form prescribed for the purposes of s.174(1A) of the Act was mandatory, and that a failure to comply would invalidate the notice.

[13] In submissions dated 31 May 2016, ALDI submitted that the change in words from ‘employer’ to ‘leader’ could not possibly render the NERR invalid.

[14] On 29 November 2016 the Federal Full Court handed down its decision in Shop, Distributive & Allied Employees Association v ALDI Foods Pty Ltd (ALDI Regency Park). The decision traversed compliance with s.174(1)(A) and addressed the decision of the Full Bench in Peabody.

[15] The Full Court decision dealt with a similar issue in regard to the alleged non-compliance with s.174(1A) concerning the word ‘employer’ being substituted with the words ‘team leader’ in the NERR notice.

[16] In respect of the NERR, Katzmann J stated that strict compliance was required, whereas Jessup J concluded otherwise. White J, while preferring not to express a conclusive view, indicated that the views of Katzmann J appeared to have some force. The views of the Full Court on this issue were obiter, as the matter was determined on other grounds with Katzmann and Jessup JJs holding that there was no need to reach a final view about whether the defective notice caused the Commissioner to fall into jurisdictional error.

[17] The SDA submitted that despite having the opportunity to do so, the decision did not overturn the decision of the Full Bench in Peabody and as such remains binding on Commission members in respect of NERR notice deviations. As the notice deviates from the prescribed form, the Agreement approval application must be dismissed.

[18] On 21 December 2016, ALDI submitted that in their view the ALDI Regency Park decision does not provide clear guidance to the Commission where the NERR departs from the prescribed form.

[19] I am of the view that the Full Bench decision in Peabody remains binding on individual members of the Commission, although it is appropriate to note that the actual NERR deviation in that matter is not the same as that raised in this matter, there being a word substitution variation.

[20] Since the decision in Peabody, the Full Bench in The Australian Maritime Officers’ Union v Harbour City Ferries Pty Ltd has accepted that a non-trivial misdescription will render a NERR invalid, with the consequence that any subsequent enterprise agreement will be incapable of approval. A Full Bench in The Maritime Union of Australia v DOF Management Australia Pty Ltd and The Maritime Union of Australia, v Smit Lamnalco Australia Pty Ltd held that the Full Court decision in ALDI Regency Park did not overturn the decision in Peabody.

[21] Where a valid notice has not been issued by the employer, the Commission cannot be satisfied that s.188(a)(ii) has been met, with the result that the Commission cannot be satisfied that the Agreement was genuinely agreed to for the purposes of s 186(2)(a).

[22] Other matters discussed in the interim decision need not be further canvassed on the basis of the application being unable to proceed due to the NERR defect.

[23] As the NERR issued by the applicant did not contain the content prescribed by the Regulations, the Commission cannot be satisfied that the Agreement was genuinely agreed and is unable to approve the Agreement.

[24] The application for approval of the Agreement is dismissed.”

[16] Substantially the same reasoning and conclusion was contained in the decision under appeal concerning the Minchinbury Agreement. 12

Submissions and evidence

[17] Aldi’s appeal grounds and submissions did not seek to challenge, other than formally, the Full Bench’s reasoning and conclusion in Peabody Moorvale. Its case was rather that the Derrimut Agreement and the Minchinbury Agreement were capable of approval consistent with Peabody Moorvale and in this respect submitted that:

• the use of the word “leader” in place of the word “employer” was not a departure from the prescribed NERR form, in circumstances where the employer was required to nominate an individual to respond to questions on the proposed agreement;

• the substitution of the nominated representative of the employer for the word “employer” did not detract from, but rather enhanced, the statutory objective of the NERR, and it was not a departure which, having regard to the statutory objective of the NERR, could properly be regarded as invalidating the form;

• to the extent the substitution of the word “leader” in place of the word “employer” might involve a departure from the prescribed NERR, any such departure was a triviality with which section 174(1A) of the FW Act might not be concerned;

• in Australian Maritime Officers’ Union v Harbour City Pty Ltd, 13 KCL Industries Pty Ltd14 and Transit (NSW) Services Pty Ltd15 it had been contemplated that trivial departures from the prescribed form would not invalidate a NERR;

• the purpose of the NERR was to inform employees of their rights to representation during bargaining, and the form of the NERR used by Aldi achieved this purpose;

• it utilised the word “leader”, which was familiar to its workforce, to nominate the individual to whom questions to the employer should be addressed, and thus facilitated the statutory purpose;

• the departure from the prescribed form did not invalidate it; it was trivial and not a matter to which the statutory intent was directed;

• in the decisions the subject of the appeal the Deputy President did not determine whether the use of the word “leader” in place of “employer” was a departure from the form or whether, if there was a trivial departure, it invalidated the NERR;

• the appeal could comfortably be upheld whilst adhering to the decision in Peabody Moorvale.

[18] Aldi sought to adduce as fresh evidence in the appeal a witness statement made by Viktor Jakupec, the Managing Director of Aldi’s Regency Park Region, which concerned the role of “leader” in Aldi’s organisational structure. At the appeal hearing we provisionally admitted Mr Jakupec’s evidence, and he was subject to cross-examination by counsel for the SDAEA. In his witness statement Mr Jakupec said:

• Aldi employees were assigned a Direct Leader, who had direct supervisory responsibilities over the employee, and a Personnel Leader, who was responsible for hiring, discipline, addressing any pay issues and termination of employment of employees;

• Aldi did not have a human resources department or anything similar; employees raised issues concerning rostering, hours of work, payslip queries, initial disputes and training issues with their Direct Leader, and issues concerning remuneration, grievances and promotions with their Personnel Leader;

• the existing enterprise agreements for the Derrimut and Minchinbury regions each referred (at cl 10) to all employees having a Direct Leader who provided day-to-day supervision, including but not limited to rostering, management and employee relationships in the workplace, and a Personnel Leader who was responsible for all other matters including but not limited to pay, discipline and final dispute resolution;

• the Aldi Management System document (which was annexed to Mr Jakupec’s witness statement), about which employees were trained, set out the workplace relationships and leadership expectations within the business, and referred extensively to the term “Leader”;

• employees were provided with a card which summarised the Aldi Management System, and an Employee Handbook, both of which referred to the term “Leader” (both documents were annexed to Mr Jakupec’s witness statement);

• when employees were required to have discussion about employment matters, they were referred to their leader;

• Area Managers were the Personnel Leaders of “Hourly Rate Stores employees” and the Direct Leader of Store Management employees, and Logistics Managers were the Personnel Leaders of Warehouse and Transport employees and the Direct Leaders of Section Leaders; and

• representatives of the SDAEA had visited stores in the Minchinbury Region following Aldi’s notification of an intention to reach an agreement, and also visited stores in the Derrimut Region to discuss the pay increase.

[19] The salient propositions arising from the cross-examination of Mr Jakupec were as follows:

• he has visited various Aldi stores in the Minchinbury and Derrimut regions and has spoken with various store assistants and warehouse employees about employment issues;

• Aldi’s organisational chart provided for separate chains of command, so that warehouse employees reported to section leaders and store assistants reported to store managers;

• store assistants did not report to a store “leader” described as such;

• the employee handbook referred to several different types of managers and leaders, and who was “leader” at any given time depended on whether the store manager, assistant store manager or deputy store manager was on duty;

• different managers would answer different types of questions, so that for example the deputy manager would deal with operational management issues if they were the “leader” at the time when the store manager and assistant store manager were away;

• personnel leaders were usually not located in the employee’s store location every day and employees were not generally given their telephone contact numbers; instead a meeting with them had to be arranged through the store manager;

• the NERRs did not distinguish between the different leadership levels and simply referred to “your leader”, but each employee had at least two leaders, and possibly three when the manager or the assistant store manager was away and a store assistant was “acting up” as a deputy manager;

[20] The SDAEA submitted that:

• the change in wording in Aldi’s NERRs was simply not permitted by s 174(1A) based upon the decision in Peabody Moorvale;

• no Full Bench decision had actually found that a NERR was valid on the basis of a finding that a defect was trivial;

• the Full Court decision in SDAEA v Aldi, which dealt with the identical NERR defect, should by itself be sufficient to decide the appeal;

• the change to the prescribed form made by Aldi was not trivial or insubstantial, and changed the meaning of the form, and the fact that Aldi felt the need to adduce evidence to explain the change demonstrated that it could not be regarded as trifling;

• where the legislative purpose was that non-compliance with the legislative prescription would lead to invalidity, there was no room for the operation of the de minimis principle, since the legislative purpose was to avoid courts and tribunals having to make judgments of the type that Aldi sought to have the Commission make in this matter.

[21] The SDAEA also sought to advance a notice of contention, to the effect that the appeals could be dismissed on the basis that in any event the Derrimut Agreement and the Minchinbury Agreement failed the better off overall test and were incapable of approval. However full argument on this point was deferred pending the determination of Aldi’s grounds of appeal on the NERR issue.

[22] The Transport Workers’ Union of Australia and the National Union of Workers did not make any submissions in the appeal.

Consideration

[23] We have decided that permission to appeal should be granted because the appeals raise issues of general importance in relation to applications for approval of enterprise agreements.

[24] For the same reasons as did the Full Bench in MUA v MMA Offshore Logistics 16 (in the passage earlier quoted), and in accordance with the manner in which the appeals were argued before us, we shall proceed on the basis that the approach taken in Peabody Moorvale (as summarised above) should be followed. We shall also assume, without deciding, that Peabody Moorvale leaves some room for the application of the de minimis principle. In doing so we however acknowledge the force in the proposition advanced by the SDAEA that it is difficult to reconcile the operation of the principle with a statutory provision which, on its proper interpretation, mandates invalidity as the consequence of a failure to strictly comply with its requirements. As an example of this, in Farnell Electronic Components Pty v Collector of Customs17 consideration was given to whether a provision in delegated legislation in which the word “exclusively” was used admitted of any exception. Once the conclusion was reached that, read in context, “exclusively” was to be given its literal meaning, it was determined that there was no room left for the operation of a de minimis principle.18 The approach advocated by Aldi requires the Commission to make value judgments about what does or does not constitute a trivial departure from the statutory prescription - a task which the legislature presumably sought be avoided by the terms in which s 174(1A) was enacted. Nonetheless we note the view expressed by Jessup J in SDAEA v Aldi that, even if strict compliance with the prescribed form for NERR is required, a minor variation in wording might not constitute a departure from the prescribed form or lead to invalidity.

[25] The de minimis principle, derived from the maxim de minimis non curat lex, is one which ameliorates the strictness of and tolerates some minor departures from statutory expressions of exclusivity. 19 In the context of the criminal law, the principle was described by Murphy J in Williams v The Queen20 as being applied “to avoid hysterical or oppressive law enforcement; cases in which a finding of guilt would tend to bring the law into ridicule or contempt because of triviality”. In relation to the prescribed form for the NERR, it might be considered that a minor wording change which does not modify the meaning or effect of the notice would be capable of being excused by application of the de minimis principle.

[26] We have determined that evidence of Mr Jakupec should be admitted in the appeal because of its utility in ascertaining the practical effect of the use of the word “Leader” in Aldi’s notice notwithstanding that the evidence could have been but was not adduced at first instance. Having regard to that evidence, we do not consider that the substitution of the word “Leader” for employer in the final paragraph of the prescribed NERR leaves unaltered the intended meaning and effect of the notice. That paragraph is intended to inform the recipient of the NERR of various avenues in which he or she may make further queries about the notice or enterprise bargaining generally. It leaves the recipient with the choice as to which of the identified source or sources of further information are to be availed of, if any, and in respect of the employer, leaves it at large to the recipient as to the manner in which any inquiry is to be directed to the employer.

[27] Aldi’s modified NERR is plainly intended to require the recipient to address any inquiries to it about the notice or enterprise bargaining to a specified category of person, namely the employee’s Leader. As the evidence of Mr Jakupec demonstrated, that may mean that the inquiry is to be made to a person who may have limited knowledge of these matters, such as a store assistant acting-up in the position of Deputy Manager. In relation to Personnel Leaders, it requires contact to be made with a person who is not usually located in the employee’s store and who may not be readily accessible by telephone. It also does not contemplate the query being made of other categories of manager including the Regional Managing Director. This is notwithstanding that Mr Jakupec himself, who was a Regional Managing Director, said he often visited stores in his region and had regular contact with employees on the shop floor, and as a senior manager had a significant degree of knowledge concerning enterprise bargaining. Without commenting upon the operational merits of Aldi seeking that inquiries arising from the NERR be directed to Leaders only, it is clear that the purpose of Aldi’s modification to the prescribed NERR was to alter its effect by explicitly restricting the avenues by which any question to it as the employer might be communicated or directed. No such limitation would apply if the prescribed word “employer” was used in the NERR, since the employee would have the discretion as to which person representing the employer they directed any inquiry as contemplated by the last paragraph in the NERR.

[28] For this reason, we do not consider that the modification can be excused as a triviality on the basis of the de minimis principle. We therefore consider that, in relation to both decisions the subject of the appeals, the Deputy President was correct in concluding that Aldi’s NERRs did not comply with the prescribed form and must consequently be regarded as invalid.

[29] We would add two further comments. First, Aldi distributed the NERRs for the Derrimut Agreement and the Minchinbury Agreement well after the Peabody Moorvale decision was issued, so it not clear to us why such a major corporation issued its NERRs in the form that it did. Second, we endorse the observation made by Katzmann J in the Full Court decision in Aldi (at paragraph [70], set out above) that Aldi could have designated an appropriate person or persons to whom questions could be directed in a document accompanying the NERR. That would have been a sensible course which did not involve any alteration to the prescribed form for the NERR.

[30] It was not suggested by Aldi or the SDAEA that, should we reject Aldi’s grounds of appeal concerning the NERR issue, we should nonetheless deal with the SDAEA’s notice of contention before disposing of the appeals. Accordingly Aldi’s appeals shall be dismissed.

Orders

[31] We order as follows:

(1) Permission to appeal is granted.

(2) The appeals are dismissed.

scription: Seal of the Fair Work Commission with the member's signature.