[2019] FWC 1122
FAIR WORK COMMISSION

DECISION


Fair Work Act 2009

s.182(4) - Applications for approval of greenfields agreements

Applications by CPB Contractors Pty Limited & John Holland Pty Ltd
(AG2018/6254; AG2018/6255)

DEPUTY PRESIDENT GOSTENCNIK

MELBOURNE, 21 FEBRUARY 2019

Applications for approval of the West Gate Tunnel Project (Tunnelling) Greenfields Agreement 2018 and the West Gate Tunnel Project (Civil Surface Works) Greenfields Agreement 2018; whether Agreements relate to a genuine new enterprise that the Applicants are establishing or propose to establish; not persuaded the Agreements relate to a genuine new enterprise; applications dismissed.

Introduction

[1] The West Gate Tunnel Project (WGT Project) is a major Victorian infrastructure project being undertaken in partnership between the Victorian Government and one of the world’s largest toll-road operators, Transurban. The nominal total cost of the WGT Project is $6,340 million 1 and it is due to be completed in 2022, although reports suggest a delayed completion date in late January 2023.2 When complete, the new infrastructure will provide an alternative to the West Gate Bridge and access to the Port of Melbourne. The West Gate Bridge currently carries over 200,000 vehicles daily. Any regular user of the bridge will know that a single incident can stop traffic. Trucks travelling through Melbourne’s west currently have little alternative but to use local roads in and around Yarraville to reach the Port of Melbourne.

[2] The WGT Project comprises several major works. There will be constructed twin tunnels under Yarraville between the West Gate Freeway and the Maribyrnong River. Four additional lanes along the West Gate Freeway will be constructed between the West Gate Bridge and the Metropolitan Ring Road. A bridge over the Maribyrnong River to connect the tunnels with a new elevated roadway above Footscray Road will also be constructed. A range of other works are also to be undertaken as part of the WGT Project, including the construction of 14kms of walking and cycling paths providing for a continuous journey from Werribee to the city. It is not to be doubted that the WGT Project is an enormous undertaking that will provide both businesses and the community with a critical piece of public infrastructure. It is currently one of the largest infrastructure projects in Australia.

[3] On 30 June 2016, the Victorian Government and Transurban issued a request for tenders with respect to the ‘design and construct’ phase of the WGT Project. CPB Contractors Pty Ltd (CPB) and John Holland Pty Ltd (John Holland) (collectively “CPBJHJV” or “Joint Venture Partners” as the context requires) jointly submitted a ‘registration of interest’ with respect to the request for tenders. CPBJHJV was shortlisted. On 2 April 2017, the Victorian Government announced CPBJHJV as the preferred tenderer for the Design and Construct Contract (D&C Subcontract). That contract was executed by CPB and John Holland on 12 December 2017.

[4] Since being announced as preferred tenderer and thereafter being confirmed as the winning bidder, the Joint Venture Partners sought to negotiate and make greenfields agreements to cover the works for which they have now been engaged to perform. Whilst the proposed greenfields agreements were being negotiated, the Joint Venture Partners and several of their subcontractors have been undertaking design work, geological testing, service relocations and other works, the precise detail of which I will later discuss. The Joint Venture Partners have also engaged various labour hire providers to supply workers to perform certain works.

[5] The negotiations for the greenfields agreements ultimately concluded on 7 November 2018, the end of a six month notified negotiation period for which provision is made in s.178B(1) of the Fair Work Act 2009 (Act). The Joint Venture Partners are single interest employers within the meaning of s.172(5)(a) of the Act and have applied to the Fair Work Commission (Commission) for the approval of the West Gate Tunnel Project (Tunnelling) Greenfields Agreement 2018 (Tunnelling Agreement) and the West Gate Tunnel Project (Civil Surface Works) Greenfields Agreement 2018 (Civil Surface Works Agreement) (collectively “the Agreements”). Each application was lodged on 9 November 2018 and pursuant to s.182(4), the Tunnelling Agreement is taken to be made with the Australian Workers’ Union (AWU) on that date. The Civil Surface Works Agreement is taken to be made with the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) and the AWU also on that date. The AWU, the CFMMEU and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) (collectively “the Unions”) oppose the approval of the Agreements on a number of grounds.

[6] In summary, these grounds are that:

(a) the Agreements do not relate to a “genuine new enterprise” of the Joint Venture Partners, within the meaning of s.172(2)(b)(i) of the Act;

(b) one or both of the Joint Venture Partners have already employed some of the persons who will be covered by the Agreements, within the meaning of s.172(2)(b)(ii) of the Act;

(c) the Joint Venture Partners have engaged in a process of recruitment of the workforce for the WGT Project which has ramifications for the statutory scheme for agreement making such that the approval of the Agreements should be refused because it is not in the public interest and so that the requirement in s.187(5)(b) is not met; and

(d) the Agreements considered on an overall basis do not provide for pay and conditions consistent with prevailing industry pay and conditions in the relevant industry for equivalent work, within the meaning of s.187(6) of the Act.

[7] I have concluded that neither Agreement relates to a genuine new enterprise that the Joint Venture Partners engaged in the CPBJHJV are establishing or propose to establish. The enterprise of the Joint Venture Partners acting in joint venture and to which the Agreements relate had by 9 November 2018 been established. As a consequence, the Agreements cannot be approved as greenfields agreements. This is the objection raised in (a) above. Given this conclusion, it has been unnecessary for me to determine the other objections raised by the Unions in (b), (c) and (d) above. The applications to approve the Civil Surface Works Agreement and the Tunnelling Agreement are dismissed. My reasons for this conclusion follow.

Consideration

Factual background

[8] It is necessary to set out at some length chronologically, some of the factual background to the making of the Agreements and to the WGT Project.

[9] During 2015, the Victorian Government undertook an evaluation of a Market-led infrastructure proposal submitted to it by Transurban. 3 As part of the evaluation, the Victorian Government undertook various due diligences, market and community engagements, site investigations4 and a business case completed in December 2015 which identified the merit of an integrated program to upgrade works which would deliver an $11 billion boost to the Victorian economy.5

[10] Three projects formed part of the Transurban Market-led Proposal, namely the WGT Project, the Monash Freeway Upgrade Project and the Webb Dock Access Improvement Works. 6 Transurban’s proposal for the WGT Project included the following key features:

“. . .

  Transurban will design, construct, operate and maintain the upgraded West Gate Freeway and the new West Gate Tunnel over a 28 year period;

  delivery of the Project works has been subject to a separate competitive design and construct (D&C) tender process, conducted jointly by the State and Transurban. This process resulted in the announcement of a joint venture between CPB Contractors and John Holland (CPBJHJV) as the preferred bidder in April 2017;

  Transurban’s operation, maintenance and toll collection functions will be delivered via a ‘centralised’ operating model, supporting both the Project and CityLink;

  the total cost for the Project is $6,685 million (nominal) including the Monash Freeway Upgrade and the Webb Dock Access Improvement Works;

  this total cost will be funded through a combination of:

- tolls imposed on users of the Project (including Heavy Commercial Vehicle (HCV) tolls on the upgraded West Gate Freeway and car, Light Commercial Vehicles and motorcycle tolls on West Gate Tunnel);

- adjustments to various CityLink tolls during the remaining term of Transurban’s existing CityLink Concession (to 2035) – including the application of a fixed 4.25 per cent per annum toll escalation rate for 10 years from 1 July 2019;

- a 10 year extension of the CityLink Concession (from 2035 to 2045); and

- a $2,658 million (nominal) in State funding contribution (State Contribution).

  to access these funding sources, the Project contract documents include not only the suite of documents relating to the design, construction, financing, operation and maintenance of the Project, but also a suite of documents related to the associated amendments to the CityLink Concession Deed. These amendments to the CityLink Concession Deed give effect to the CityLink funding sources and other negotiated improvements in the State’s commercial position under the CityLink Concession Deed.” 7

[11] In April of 2016 a concept design for the proposed WGT Project was publically released. 8 An invitation for expressions of interest for the D&C Subcontract was issued inviting potential tenderers to submit expressions of interest and to provide information on selected key issues to assist in preparing the request for tender for the WGT Project.9 On or about 22 April 2016, CPB and John Holland submitted a registration of interest for the proposed WGT Project.10 On 30 May 2016, CPB and John Holland submitted an expression of interest for the proposed WGT Project.11

[12] A request for tenders for the WGT Project was issued on 30 June 2016 for the purposes of procuring a D&C Subcontractor to design and construct the WGT Project. 12 By 3 November 2016 the tenders for the design submission had closed13 and the remaining tender submissions closed on 17 November 2016,14 with CPB and John Holland submitting a tender for each.15

[13] Subsequently three tenderers, including the Joint Venture Partners engaged in the CPBJHJV, were shortlisted to progress to the next stage of procurement. 16 On 2 April 2017, the CPBJHJV was appointed as the preferred tenderer for the D&C Subcontract and it entered into a D&C Commitment Deed with Transurban and the State of Victoria.17 Between May and August 2017, the proposed project related activity included formal submissions on the Environment Effects Statement (EES), draft Planning Scheme Amendment (PSA) and Works Approval Application were invited during a six week public exhibition period and public information sessions and hearings were convened.18

[14] On 11 September 2017, the CPBJHJV gave written notice to the AWU of the notified negotiation period in relation to both the Tunnelling and Civil Surface Works Agreements and on 12 September 2017 it similarly gave notice to the CFMMEU in relation to the Civil Surface Works Agreement. 19 Following the earlier mentioned public information sessions and hearings, the Inquiry and Advisory Committee conducting those information sessions and hearings provided a report to the Minister containing its findings and recommendations in respect of the EES process.20
[15] Certain site establishment, sewer diversion and foundation works at the tunnel zone - North Portal were scheduled between early November 2017 and early October 2018. 21

[16] On 29 November 2017, the CPBJHJV conducted the first of a series of bargaining meetings with the AWU in relation to the Tunnelling Agreement. 22 Between 7 December 2017 and 12 October 2018 a further 17 bargaining meetings would occur between the CPBJHJV and the AWU in relation to the Tunnelling Agreement.23

[17] In late November 2017, the CPBJHJV posted online a call for “Expressions of Interest – Trades & Labour – West Gate Tunnel Project”. 24

[18] On 7 December 2017, the Planning Scheme Amendment was gazetted and on 8 December 2017 Works Approval was issued and the Project Area designation was also gazetted. 25 On 11 December 2017, the Victorian Government executed a project agreement with Transurban to design, construct and finance the WGT Project and to operate and maintain the WGT Project over the period to January 2045.26

[19] On 12 December 2017, the CPBJHJV parties executed the D&C Subcontract. The D&C Subcontract supports the delivery of the WGT Project works. 27 The D&C Subcontract is not in evidence.

[20] Works associated with traffic management and services relocation were scheduled to be undertaken between December 2017 and February 2019 at the East Zone of the WGT Project. 28 Throughout 2018 and onwards, various other works at a number of the Zones forming parts of the WGT Project were scheduled to be undertaken.29 In January 2018, the CPBJHJV commences a labour hire provider tender process out of which a panel of approved labour providers is established by around the middle of 2018.30

[21] On 2 February 2018, the CPBJHJV conducts the first of two bargaining meetings with the AWU and the CFMMEU in relation to the Civil Surface Works Agreement. 31 A further bargaining meeting in relation to the Civil Surface Works Agreement is held on 9 February 2018.32

[22] During March 2018, the CPBJHJV puts various revised drafts of the Tunnelling Agreement to the AWU, the dates for acceptance of which passed without acceptance, the last being 5 April 2018. 33 On 30 April 2018, the CFMMEU wrote to the CPBJHJV contending that the notified negotiation period in respect of the Civil Surface Works Agreement had expired without producing an agreement that was capable of being approved by the Commission. The CFMMEU sought a written undertaking that the CPBJHJV would not apply for approval of the Civil Surface Works Agreement, in the absence of which the CFMMEU would apply to the Federal Court of Australia for an injunction.34 Also on 30 April 2018, the AWU sent a letter to the CPBJHJV in substantially the same terms.35

[23] The CFMMEU and the AWU filed an Originating Application and Statement of Claim, to which CPB and John Holland were respondents, in the Federal Court of Australia on 4 May 2018 in respect of the Tunnelling Agreement and the Civil Surface Works Agreement. 36 On the same day, the CPBJHJV gave a new notice of a negotiating period in respect of the Tunnelling Agreement to the AWU and new notices to the AWU and the CFMMEU in respect of the Civil Surface Works Agreement.37 As a consequence, the aforementioned Federal Court application was discontinued by consent on 7 May 2018.38

[24] Thereafter and until late October 2018, various efforts to reach agreement on the Civil Surface Works and Tunnelling Agreements were made, including pursuant to an application to the Commission under s.240 of the Act. 39

[25] As earlier noted, in January 2018, the CPBJHJV commenced a labour hire provider tender process out of which a panel of approved labour providers was established by around the middle of 2018. By August 2018, that panel had been established and in the result the industrial relations/commercial teams of the Joint Venture Partners mobilised the first round of employees through a labour hire company, Groundhog, in the Tunnel Zone of the WGT Project. 40 This appears to have involved transitioning employees who had previously been employed by subcontractors performing works on the WGT Project to one of the labour hire panel companies.41

[26] On 19 October 2018, the CPBJHJV sent correspondence to the AWU enclosing a copy of the Tunnelling Agreement for consideration and execution by the AWU. 42 Also on that date, the CPBJHJV sent correspondence to the AWU and the CFMMEU enclosing a copy of the Civil Surface Works Agreement for consideration and execution by them.43

[27] The six month notified negotiating period, notice of which had been earlier given in respect of the Civil Surface Works and the Tunnelling Agreements, expired on 7 November 2018. 44 As already noted, the Joint Venture Partners applied to the Commission for the approval of the Tunnelling Agreement and the Civil Surface Works Agreement on 9 November 2018.

[28] Since May 2017, the CPBJHJV has been preparing various monthly progress reports in respect of the WGT Project. 45 Between May 2017 and November 2017 these reports were titled “West Gate Tunnel Project Monthly Progress Report” numbered 1 through 7.46 From January 2018, these reports were titled “Monthly D&C Phase Progress Report” and appear to be prepared pursuant to obligations under the D&C Subcontract upon the CPBJHJV in its capacity as D&C Subcontractor. These reports all detail relevant activities, progress and critical issues concerning the WGT Project. For example, the Monthly D&C Phase Progress Report of June 201847 sets out the following in its Executive Summary:

“…Working hours for the reporting period 21 May to 20 June was 194,007, bringing the total to 1,212,085 . . . Direct workforce and subcontractors is approximately 982.

. . .

Design effort is at its peak with over 78% of all Permanent Work Design Packages (excluding utilities) being progressed.

. . .

Construction continues to increase with the opening of the Williamstown W1 Ramp (eastbound exit ramp) in the West Zone, allowing works to commence on the 202B north shoulder (including permanent ramp W1). Works have commenced on the 202B south shoulder following traffic management from local streets. Tree clearing and barrier removals works commenced on the northern shoulder in 202A. The West Zone team is fully mobilised at their site office at Cawley Road in Yarraville.

. . .” 48

[29] In each of the Monthly D&C Phase Progress Reports for July through to September 2018, there is to be found reports on the progress of both the design and the construction aspects of the WGT Project together with details about the increasing numbers of directly employed, subcontractor employed and labour hire employed workers engaged on the WGT Project. 49

[30] The Executive Summary to the Monthly D&C Phase Progress Report of October 2018 (October 2018 Report) contains the following:

“During the month of October, the project saw significant progress across all seven major construction sites.

. . .

A major construction highlight this month was the completion of the Northern Portal piling works – which saw the installation of one thousand piles!

. . .

This is a great achievement by the Tunnel zone team, and sets the project up for the impending arrival and assembly of the tunnel boring machines (TBMs).” 50

[31] The October 2018 Report contains the following table which sets the progress to date compared to that which was planned to date in respect of both the design and construct aspects of the WGT Project:

Table 4: Progress monitoring 51

 

Phase

To Date Planned Early

%

To Date Actual/Earned

%

1a

Overall Design Phase

59.91%

56.02%

1b

Overall Construction

4.95%

3.59%

1b(ii)

Zone 200 – West

6.14%

4.52%

1b(iii)

Zone 300 – Tunnel

6.96%

6.08%

1b(iv)

Zone 400 – East

1.40%

1.13%

1b(v)

Zone 500 – ME&I

0.57%

0.21%

1b(vi)

Zone 600 – Buildings

0%

0%

1b(vii)

Zone 700 – Precast

0%

0%

[32] The October 2018 Report also contains a summary of the construction progress made in respect of various parts of the WGT Project. Section 4.3 deals with “Construction – West” and sets out relevantly the following:

“Works in the West are now being undertaken on multiple work fronts. From Fogarty Avenue, Williamstown Road, Paringa Avenue, Lynch Reserve to Kororoit Creek.

. . .

Zone Wide

All remaining compounds (Grieve Parade and Geelong Road) were completed during the month of October, with only semi-permanent connections to utilities remaining. The West mobilisation team has been disbanded, with staff being deployed to numerous works zones across the West.

. . .

West Gate Freeway, Kororoit to Kyle Road

At the Millers Road interchange, works were focused on the RSS wall along the M2 Ramp which has been travelling along smoothly. The architects from Wood Marsh visited site and inspected the architectural panels and praised the end product. Bridge piling works on the east side commenced and were completed, however, delays with some of the Inbound Construction Documentation meant that the south-eastern embankment fill couldn’t commence and finish in time to allow the rig to complete the south-eastern abutment piles.

. . .

The southern widening works continued with works focusing on the area west of Freemans Road which is not impacted by Powercor’s 60kV powerline.

. . .

West Gate Freeway, Kyle Road to Williamstown Road

. . .

Temporary noise wall installation is progressing well in the south widening area. Removal of the existing noise wall has commenced, and the area is set up, ready for piling to commence in the next week for the new retaining walls and noise walls.

. . .” 52

[33] Section 4.4 of the October 2018 Report deals with “Construction – Tunnel” and sets out, relevantly the following:

“During the month, piling works at the Northern Portal was complete – a total of 1000 piles were installed, made up of 580 secant piles and 420 tension piles. This is a massive achievement by all of the construction, engineering, quality, safety, community, traffic and commercial teams in the Tunnel Zone but, in particular the Northern Portal construction team. . .

Zone Wide

Continued mobilisation of staff for the works.

. . .

Tunnel Section

. . .

. . .” 53

[34] Section 4.5 of the October 2018 Report deals with “Construction – East” and sets out, relevantly the following:

“The Footscray Road new permanent shared use paths has now opened. It was opened in sections, with the first between Appleton Dock Road and Dock Line Road, and the western section between Dock Link Road and Shepherd Bridge opened a week later. The remainder of the shared use path along the service lane near Apple Dock Road will be opened in the coming weeks.

. . .

Footscray Road Elevated and Ramps

. . .

The Footscray Road CitiPower asset crossings relocations design is complete. Work on these relocations should commence towards the end of October.

. . .” 54

[35] The October 2018 Report discloses that as at 20 October 2018, the CPBJHJV had claimed payment for executed works in respect of the D&C phase in the amount of $864,576,710. 55 By 20 November 2018, the amount claimed was $952,942,416.56

[36] The October 2018 Report also discloses that as at 20 October 2018 the total project strength, that is, the headcount of people working on the WGT Project, was 1,643. 57 Consistent with the observations in the report about the level of construction activity concerning the tunnel section, the average headcount associated with the tunnel section during October 2018 was 378.58 By 20 November 2018, the total project strength number had grown to 1,70359 and the average headcount during the reporting period associated with the tunnel section was 389.60

[37] The progress position of the WGT Project as disclosed from the Monthly D&C Phase Progress Report discloses that by 20 October 2018:

  the CPBJHJV had claimed payment for executed works in the amount of $864,576,710; 61

  approximately 20% of the time estimated for the completion of the WGT Project had elapsed;

  the total WGT Project headcount was 1,643; 62 and

  there had been recorded total of 2,432,224 working hours for the WGT Project. 63 Of this total amount, 323,884 working hours are recorded to have been worked on the WGT Project between 21 September 2018 and 20 October 2018.64

Whether the Agreements relate to a genuine new enterprise?

[38] Section 172 of the Act provides, inter alia, for the making of enterprise agreements that are greenfields agreements. These may be made on a single-enterprise or multi-enterprise basis. A single-enterprise agreement that is a greenfields agreement is one that meets the description in s.172(2)(b). 65  That sub-section provides:

“(2) An employer, or 2 or more employers that are single interest employers, may make an enterprise agreement (a single-enterprise agreement):

(b) with one or more relevant employee organisations if:

(i) the agreement relates to a genuine new enterprise that the employer or employers are establishing or propose to establish; and

(ii) the employer or employers have not employed any of the persons who will be necessary for the normal conduct of that enterprise and will be covered by the agreement.

Note: The expression genuine new enterprise includes a genuine new business, activity, project or undertaking (see the definition of enterprise in section 12).”

[39] Section 172(4) of the Act describes that which is a greenfield agreement as follows:

“(4) A single-enterprise agreement made as referred to in paragraph (2)(b), or a multi-enterprise agreement made as referred to in paragraph (3)(b), is a greenfields agreement.”

[40] Section 172(5) of the Act describes the circumstances in which two or more employers are single interest employers for the purposes of making an enterprise agreement as follows:

“(5) Two or more employers are single interest employers if:

(a) the employers are engaged in a joint venture or common enterprise; or

(b) the employers are related bodies corporate; or

(c) the employers are specified in a single interest employer authorisation that is in operation in relation to the proposed enterprise agreement concerned.”

[41] Section 12 of the Act ascribes a meaning to the word “enterprise”, that is, “a business, activity, project or undertaking.”

[42] Section 182(3) provides that a greenfields agreement is made when it has been signed by each employer and each relevant employee organisation that the agreement is expressed to cover (which need not be all of the relevant employee organisations for the agreement). However, this subsection does not relate to the making of the Agreements.

[43] The Agreements were made or taken to have been made under s.182(4), a provision added to the Act by the Fair Work Amendment Act 2015 (Cth) (2015Amendment Act). That subsection provides:

182 When an enterprise agreement is made

(4)  If:

[44] As the note to s.182(4) suggests, s.185A, a provision also added to the Act by the 2015 Amendment Act, is relevant and provides:

185A Material that must accompany an application under subsection 182(4) for approval of a greenfields agreement

An application under subsection 182(4) for approval of an agreement must be accompanied by:

(a)  a copy of the agreement; and

(b)  any declarations that are required by the procedural rules to accompany the application.”

[45] There is no controversy that the preconditions set out in s.182(4) have been satisfied in respect of each of the Agreements. As I have already noted, the applications to approve the Civil Surface Works and the Tunnelling Agreements were lodged in the Commission on 9 November 2018 and pursuant to s.182(4)(g). Each Agreement is taken to have been made on that day.

[46] Save for the manner and the time within which an application under s.182(4) is made, and the material that must accompany such an application, 66 the other requirements for a greenfields agreement pertain to an agreement that is made pursuant to s.182(4), which relevantly for present purposes, includes that such an agreement is one that meets the characteristics in s.172(2)(b).

[47] Section 172 of the Act provides for the circumstances in which an enterprise agreement may be made, and deals with both single-enterprise agreements and multi-enterprise agreements. As earlier noted, the Agreements the subject of these applications are single-enterprise agreements which purport to have been made as greenfields agreements pursuant to s.182(4). The question whether an enterprise agreement is a greenfields agreement affects the operation of many provisions of Part 2-4 of the Act on that agreement, 67  and whether the single-enterprise agreement is a greenfields agreement depends upon the terms of s.172(2)(b).

[48] Where, as here in relation to the approval of the Agreements, jurisdiction depends upon particular facts or a particular state of affairs as set out in s.172(2)(b), those facts upon which the jurisdiction depends must be established on the balance of probabilities in light of all of the evidence in the proceeding. 68 The search is for the objective character and identity of the enterprise to which the Agreement will apply and its novelty in relation to the employer’s business.69

[49] For present purposes, it is necessary to first identify the “genuine new enterprise” to which the Agreements relate and secondly to consider whether the Joint Venture Partners engaged in the CPBJHJV are establishing or propose to establish the identified enterprise. The time at which the assessment is made is when a greenfields agreement is made.

[50] CPB and John Holland are “single interest employers” by reason of their joint venture. The collective overall purpose which unites the Joint Venture Partners is the package of works to be designed and constructed pursuant to the D&C Subcontract. It is not seriously controversial that this business, activity, project or undertaking is the “enterprise” of the CPBJHJV.

[51] The Joint Venture Partners contend that the “enterprise” is the Joint Venture Partners’ common purpose or undertaking, as joint venturers, to design and construct the tunnels, freeway upgrades, bridges and elevated roadways comprising the principal elements of the WGT Project. 70

[52] The works that comprise the WGT Project have been earlier described. These are also described in each Agreement 71 as including:

(a) Widening the West Gate Freeway from 8 to 12 lanes and includes express lanes between the M80 and the Westgate Bridge;

(b) A tunnel from the West Gate Freeway to the Maribyrnong River and the Port of Melbourne;

(c) A bridge over the Maribyrnong River, linking to an elevated road along Footscray Road to CityLink and connecting roads to the CBD; and

(d) Other incidental works such as widening and modifications to the M80 and other local roads, landscaping and road management systems.

[53] The Unions contend that I should find that the enterprise of one or both employers is not “new” 72 for the following reasons:

  On 30 April 2015, the Victorian Government announced that Transurban had approached it with a proposal to build what is now known as the WGT Project, but which was then described as the “Western Distributor” project. From the outset, it involved a plan to “connect the West Gate Freeway to CityLink via a tunnel, a second river crossing and an elevated freeway along Footscray Road”, at the cost of approximately $5 billion; 73

  On 8 December 2015, the Victorian Government announced it would partner with Transurban to build the WGT Project;

  Shortly thereafter, the Victorian Government announced that the “first section” of the WGT Project would be works on and around Cook Street, to better connect the southern end of CityLink with the West Gate Freeway. The works were to be “delivered by Leighton Contractors (Leightons) (now known as CPB) for Transurban”. Design work was “well underway”; “geotechnical work” was about to commence; and “major construction” was to begin in 2016. These works later became known as the “Webb Dock Access improvements”;

  On 10 May 2016, the Victorian Government announced that the joint venture between CPB and John Holland were one of five builders which were invited to tender for the remainder of the Project; 74

  On 21 June 2016, the Victorian Government announced that the Joint Venture was its preferred tenderer; 75

  On 2 April 2017, the Joint Venture was announced as the winning bidder for the Project, now officially re-named as the “West Gate Tunnel Project”; 76

  The CPBJHJV began performing “Early Works” (surveying and geotechnical investigative work) in July 2017. By July 2017, 57,695 person-hours had been worked; 77

  On 12 December 2017, the Victorian Government announced it had signed the construction contracts with the Joint Venture Partners (a reference to the D&C Subcontract), and that works on the Northern Tunnel Portal were to begin in January 2018; 78

  Construction work started in January 2018. 79 By April 2018, more than 1,000 people had worked 846,516 hours on the WGT Project, including designers and engineers, but including 390 people in the “delivery” team.80 By October 2018, the construction works were well advanced across seven construction zones; the Northern Portal piling works (involving the placement of almost 1,000 piles and 20,000 cubic metres of concrete) was complete.81 There are currently approximately 150 construction workers working on the WGT Project;

  In considering what enterprise is “new”, the Commission should have regard to the Explanatory Memorandum to the Bill introducing s.182(4) into the Act, which explained that part of the intended policy behind greenfields agreements is to allow those proposing new projects to fix their labour costs before obtaining finance, and to limit exposure to protected industrial action before the project starts. 82 This suggests that the drafters of s.182(4) had in mind that greenfields agreements would be put in place long before the first shovel was turned;

  That conclusion is reinforced by the language of s.172(2)(b)(i) in referring to a new enterprise which the employers are “establishing” or “propose to establish”. As was pointed out in National Union of Workers, New South Wales v HP Distribution Pty Ltd 83 (HP Distribution), it is significant that the present tense is used.84 Once a project is, in fact, already “established”, then it is too late to consider it “new”;

 

  The reference to the enterprise being one that the “employer or employers” are establishing means that, where (as is the case here) two single-interest employers make a single-enterprise agreement, the enterprise or activity must be new for both employers, not just one of them; and

  In the present case, the Agreements do not relate to a “new” enterprise which CPB or John Holland has established. In CPB’s case, its role on the WGT Project began in substance in December 2015, when it completed the Webb Dock Access improvements. As such, its enterprise relating to the WGT Project cannot still be regarded as new almost three years later, in November 2018, when the Agreements were lodged. In John Holland’s case, its role on the WGT Project began when it won the tender, with CPB, in April 2017. The work done on the WGT Project since then has been very substantial. It constitutes the carrying out of the WGT Project. Indeed, the WGT Project is now 20% complete, measured by time. 85

[54] During oral argument, the Unions submitted that the enterprise of the joint venture is to enter into and perform the D&C Subcontract. They contended that a finding to that effect leads inexorably to the conclusion that once the Joint Venture Partners entered into the D&C Subcontract on 12 December 2017, they were thereafter carrying out the operation of the enterprise. The enterprise was thus established, it was no longer one that the Joint Venture Partners are establishing or propose to establish. 86

[55] John Holland and CPB are not related bodies corporate nor are they employers who are specified in a single interest employer authorisation that is in operation in relation to the Agreements. As I have already noted, they are single interest employers only because they are engaged in a joint venture or common enterprise. 87

[56] I do not accept that the whole of the WGT Project as described in various Victorian Government media releases to which the Unions have referred, and dating back to 30 April 2015, is the relevant enterprise for the purposes of considering whether the Agreements are made in relation to a genuine new enterprise. Indeed, the early media releases are concerned with the engagement between the Victorian Government and Transurban in relation to the WGT Project. I consider that that which is relevant is the package of works for which the CPBJHJV was announced as the winning tenderer and for which the D&C Subcontract was executed.

[57] Such a conclusion is consistent with the text and structure of s.172(2)(b)(i), which provides that the relevant ‘genuine new enterprise’ to which the agreement relates is one that “the employer or employers are establishing or propose to establish”. The reference to “employer or employers” is given meaning by the opening words of s.172(2), namely “an employer, or 2 or more employers that are single interest employers, may make an enterprise agreement…”. Two or more employers, as in the present case with CPB and John Holland, can only be single interest employers if relevantly they “are” engaged in a joint venture.

[58] For the purposes of the agreement making and approval process, in respect of the Agreements, it is the “enterprise” of the single-interest employers, namely CPB and John Holland engaged in a joint venture which is to be assessed. That enterprise is best described as the design and construction of the tunnels, freeway upgrades, bridges and elevated roadways and other works required by the D&C Subcontract comprising the WGT Project. The works undertaken by CPB and John Holland prior to their entry as Joint Venture Partners into the D&C Subcontract were not, in my view, works undertaken as part of the relevant enterprise and are not relevant for the purposes of the assessment I must make. In this respect, I accept the Joint Venture Partners’ contention that the D&C Subcontract date of 12 December 2017 represents the firing of the starter’s pistol on the genuine new enterprise. Prior to execution of the D&C Subcontract, there was no guarantee that the package of works under the D&C Subcontract would proceed at all, much less that the Joint Venture Partners would perform the work it required. At its highest, pre-D&C Subcontract works performed by one or the other of the Joint Venture Partners show that the Joint Venture Partners were at that earlier stage ‘proposing to establish’ or were ‘establishing’ a genuine new enterprise.

[59] In my view, it is the “enterprise” of the Joint Venture Partners, as joint venturers, which must be distinguished from work carried out by each or either of them outside the joint venture, including any work either may have done on the WGT Project prior to entering into the D&C Subcontract. The works undertaken by the Joint Venture Partners prior to their entry into the D&C Subcontract is properly described as works that were preparatory in “establishing” the enterprise. Moreover, the businesses or enterprise which CPB and John Holland conduct separately, the previous employment or labour arrangements of CPB (or the previously named Leightons) or John Holland, are not relevant to the assessment required in the circumstances of this enterprise and the Agreements. The applications for the approval of the Agreements concern two single-enterprise agreements each made by two single interest employers, and it is the enterprise of the two employers in their capacity as single interest employers that falls for consideration. Thus, it is the enterprise of the Joint Venture Partners that is relevant.

[60] The Joint Venture Partners contend that they are still ‘establishing’ their genuine new enterprise. They contend that the evidence reveals that the works performed to date are preliminary and preparatory in nature, and are dwarfed in comparison to the principal works to be performed pursuant to D&C package of works: namely, the boring and construction of twin 16.5 metre wide tunnels, the widening of the West Gate Freeway from 8 to 12 lanes, and the construction of bridges and elevated roadways.

[61] The Joint Venture Partners contend that when applying s.172(2)(b)(i), there are critical distinctions to be made between three types of work which might be performed in relation to a genuine new enterprise: 88

  initial planning work engaged in prior to the establishment of the genuine new enterprise, which falls within the scope of ‘proposing to establish’ that enterprise;

  preliminary or preparatory work, which falls within the scope of ‘establishing’ a genuine new enterprise; and

  the substantive work of the enterprise itself, once established.

[62] Of those 3 categories, only the last disqualifies the enterprise from satisfying s.172(2)(b)(i). 89

[63] I agree with the Joint Venture Partners’ analysis above. It is consistent with the authorities and specifically with the judgment in HP Distribution.

[64] HP Distribution concerned an application to the Federal Court of Australia by the National Union of Workers (the NUW) for constitutional writ relief against Fair Work Australia’s (FWA) decision to approve the HP Distribution Pty Ltd Greenfields Agreement 2011 as a greenfields agreement. The agreement was made on 9 December 2011 between HP Distribution Pty Ltd, a subsidiary Woolworths Ltd (Woolworths), and the Shop Distributive and Allied Employees Association (SDA). The agreement related to a development known as the Hoxton Park precinct at which two large warehouses were situated. The Hoxton Park precinct functioned as a distribution centre, which serviced several businesses in the Woolworths group of companies. In October 2011, Woolworths and the New South Wales branch of the SDA began negotiations to establish two new distribution centres at the Hoxton Park precinct. The agreement covered employees working at the site. A Full Bench of FWA has concluded that HP Distribution was a new business established to operate a distribution business to service a different balance of subsidiaries using different methods of operation than any other existing business, and further that the agreement was a greenfields agreement relating to a genuine new enterprise within the meaning of s.172(2)(b).

[65] Before the Court, the NUW argued, inter alia, that the Full Bench had erred because the agreement did not relate to a genuine new enterprise that the employer or employers were establishing or proposing to establish within the meaning of s.172(2)(b)(i), and because prior to the respondent’s incorporation and before the agreement was made, some persons had already been employed to do work in the enterprise by other related entities.

[66] As to the particular facts, Woolworths established HP Distribution Pty Ltd to arrange for the distribution of goods for three significant business units within the overall Woolworths organisation. That was a new business activity, project or undertaking. It would be conducted from one location. Staff employed by HP Distribution at the Hoxton Park precinct would be able to move from one part to another to service the requirements of the distribution activities as they changed or developed. Woolworths had not previously established such an enterprise, although some preparatory work had been done in a preliminary fashion by persons employed by Action Work Force, a labour hire company, related solely to the Dick Smith indent storage arrangements. The scope, structure and direction of the way in which the two sheds were to operate at the Hoxton Park precinct was not the same as the undertaking or work of the labour supplied by Action Work Force when operating, in the preliminary stages, earlier in 2011 at the Hoxton Park precinct.

[67] The factual matrix in HP Distribution disclosed that the genuine new enterprise was one established “for the distribution of goods for three significant business units within the overall Woolworths organisation. That was a new business activity, project or undertaking.” 90 Whilst the greenfields agreement was made by a newly create entity, HP Distribution Pty Ltd, Woolworths had performed a range of works, including completing the building site and internal fit-out of the buildings, testing automation equipment, and performing the managerial work necessary to establish the business at the site prior to entering into the Agreement. The Court concluded that these steps were insufficient to extend beyond the bounds of ‘establishing’ the genuine new enterprise. Relevantly, Rares J said:

“It is difficult to contemplate how two or more employers, who were not all single interest employers, would be able to make an enterprise agreement for the purposes of s 172(3)(b) unless significant preparatory work to formulate business plans and define roles for each of those employers had been done. Where two or more employers with different interests agree to undertake a new enterprise, ordinarily, they will need to identify the nature and scope of their individual responsibilities for the future conduct of the enterprise, what each of those employers expects the business to do, how its activities will be undertaken, the nature of the tasks and work the employees will perform, their training and the other incidents that such a complex arrangement would involve. The practical implementation of such an arrangement may also require considerable lead time before the new enterprise would be ready to commence operating. Such arrangements might also need to address any issue that might arise under the provisions of Pt IV of the Competition and Consumer Act 2010 (Cth) in relation to their collaboration on that matter.

There is nothing in s 172(3) that identifies any particular assignment of responsibilities between the two or more employers as to whether one or all is or are to undertake the relevant establishment work, or whether the enterprise agreement will be made by all of the employers, one or some of them together with, or simply by, a special purpose vehicle that is a newly incorporated subsidiary of one or some or all of the employers. Those matters suggest that the Parliament intended that a genuine new enterprise could be in the process of being established to a greater or lesser extent before the ink had to be dry on greenfields agreement or the vehicle by which it would be conducted was identified or incorporated. Indeed, the expressions “are establishing” and “propose to establish” in each of ss 172(2)(b)(i) and (3)(b)(i) indicated that one of two scenarios might exist and that preparatory steps, even of a very substantial nature, would not necessarily disqualify an agreement from being a greenfields agreement for the purposes of s 172(2) or (3). The mere fact that an employer, or a related company, had taken steps to establish the business, of itself, will not detract from the genuineness of the new enterprise or preclude the employer subsequently being able to enter a greenfields agreement provided that the requirements in s 172(2) or (3) are met.

. . .

As a matter of practical reality, I am satisfied that the business, activity, project or undertaking which prior to 9 December 2011 Woolworths had contemplated be established at the Hoxton Park precinct was genuinely new and different from an existing enterprise. I reject NUW’s argument that the participation of Woolworths in the preparatory planning and development of the enterprise or the agreement meant that HP Distribution could not be said to be the relevant employer. For the reasons above, I am of opinion that s 172(2)(b) envisages that a holding company may do significant preparatory work directed to establishing or proposing to establish a genuine new enterprise that it intends will be conducted by a subsidiary that will be incorporated shortly before the subsidiary enters into a greenfields agreement with a relevant employee organisation. The relationship between the holding company and the subsidiary, together with the amount of preparation cannot preclude, but may be relevant to, the characterisation of the enterprise agreement as a greenfields agreement for the purposes of s 172.” 91

[68] There remains however, a qualitative difference between an employer, or two or more employers engaged in a joint venture or common enterprise, undertaking preparatory steps, even of a very substantial nature in the course of establishing a new enterprise and that employer or those employers taking steps in the conduct of the enterprise. The latter no longer involves establishing a new enterprise and a greenfields agreement cannot, in my view, be made in relation to a new but established enterprise.

[69] Assessing whether since executing the D&C Subcontract and relevantly as at 9 November 2018, the Joint Venture Partners engaged in the CPBJHJV have undertaken works that are preparatory steps in establishing the new enterprise or whether the works undertaken are works of an established enterprise conducted by the CPBJHJV, requires an objective assessment of the conduct and activity of the Joint Venture Partners engaged in the CPBJHJV. The assessment is directed to the activities of the Joint Venture Partners referable to the new enterprise and requires a proper characterisation of the activities of the Joint Venture Partners at the relevant time. Put simply, the question is: were the various works and other activities being carried out by the Joint Venture Partners as at 9 November 2018 things done in the nature of establishing the genuine new enterprise?

[70] I accept that an enterprise in the nature of a new business, activity, project or undertaking is not necessarily established upon an employer, or two or more employers engaged in a joint venture or common enterprise entering a contract, or in this case the D&C Subcontract. A contract may not for example, require anything to be done for quite some time. A contract may be conditional or performance under it may be subject to obtaining particular approvals. I also accept while the objectives of the CPBJHJV will doubtless have included winning a tender and signing a D&C Subcontract, the true collective overall purpose of the CPBJHJV is to deliver the WGT Project works in accordance with the D&C Subcontract for commercial reward. Success in the tender process and executing the D&C Subcontract were the necessary preconditions for the commencement of works under the D&C Subcontract, but those activities do not of themselves establish the enterprise.

[71] It follows from the above and in the circumstances of this case that I do not accept the Unions’ submission that in order for the Agreements to have been made as greenfields agreements, they were needed to have been made at least before the D&C Subcontract was executed and “long before the first shovel was turned.” 92

[72] In aid of its contention that the works undertaken by the CPBJHJV since executing the D&C Subcontract and until 9 November 2018 were preparatory steps as part of establishing the enterprise, the Joint Venture Partners cited the following examples of cases it says would involve establishing an enterprise rather than conducting an established enterprise: 93

  in the case of a mine, a company may be contracted by a landowner to construct a mine and licensed to extract minerals and transport them to a port. The Unions would have it that once the contract has been signed, the new enterprise should be regarded as established from the moment the first tree is removed from the land or a temporary fence is erected around the perimeter or work sheds are delivered. It would defy common sense to suggest that such an enterprise was established when it may be many months or even years before plant is delivered or minerals extracted; and

  in the case of a building project, a company is contracted to design and construct an apartment tower. Again, it would seem at odds with the ordinary use of language in a commercial setting to suggest that the new project was “established” from the moment the architect’s pen touched paper, a temporary safety fence is erected or the site is cleared of debris – all of which might take place months or years before construction is even approved by relevant statutory authorities.

[73] Accepting, without deciding, that the examples proffered are each of preparatory steps in establishing an enterprise, neither is apposite to that which has occurred here.

[74] The expression “establishing” attaches to the activities of the Joint Venture Partners engaged in the CPBJHJV in respect of the new business, activity, project or undertaking. As the Joint Venture Partners have contended, the overall objective of the Joint Venture Partners engaged in the CPBJHJV is the delivery of the package of works that they have been contracted to design and construct and that enterprise involves the delivery of all of the works, in accordance with and over the timeframes set out in the detailed planning documents. 94

[75] I do not consider that commencing and undertaking the package of works required to be undertaken by the D&C Subcontract as at 9 November 2018 can, in the circumstances of this case, be regarded as merely preparatory works in establishing the enterprise. The Joint Venture Partners did not contend that the works thus far undertaken were not within the scope or packages of works required by the D&C Subcontract.

[76] It is not the case, as the Joint Venture Partners seem to suggest at various points in its submissions 95 by reference to “principal works” or “principal elements” or “principal parts” of the WGT Project, that the s.172(2)(b)(i) enquiry is limited to whether the principal works of an enterprise have commenced or been established, and so that until that point, the works undertaken in connection with the enterprise are preparatory works in establishing the enterprise. For example, the Joint Venture Partners contend that:

“The evidence reveals that the works performed to date are preliminary and preparatory in nature, and are dwarfed in comparison to the principal works to be performed pursuant to D&C package of works: namely, the boring and construction of twin 16.5 metre wide tunnels, the widening of the West Gate Freeway from 8 to 12 lanes, and the construction of bridges and elevated roadways.” 96

[77] Respectfully, this approach finds no support in the words of the statute. The issue will always be, relevantly, whether at the time an agreement is made, an employer, or two or more employers engaged in a joint venture or common enterprise, is or are establishing the enterprise or whether the enterprise to which the agreement relates is already established.

[78] It seems to me, in a commercial context, that an established enterprise contemplates activities undertaken as a commercial enterprise in the nature of a going concern, that is, activities engaged in for the purpose of profit on a continuous and repetitive basis. 97 Establishing such an enterprise requires certain things to be done or activities to be undertaken. That which must be done in establishing an enterprise will of course depend on the nature of the particular enterprise. Nonetheless, there will be a point at which the actual activity intended to be performed for the purpose of commercial reward will commence. At that point enterprise is established. To use some of the examples to which various of the parties referred during submissions, in the case of a shop, it is likely when goods commence to be sold. In the case of the carpark, it is when patrons commence to be charged for parking. In the case of a mine, it will be when the mining equipment is commissioned and deployed or perhaps when the work to extract relevant minerals commences. In the case of a construction project, it will be when construction begins.

[79] The Joint Venture Partners sought to rely on a decision of the Commission in Lend Lease Engineering Pty Ltd; Bouygues Construction Australia 98 (Bouygues) in which, so the Joint Venture Partners contend, the facts and arguments in Bouygues bear striking resemblance to the present case.99

[80] In Bouygues a greenfields agreement was made relating to a major civil construction project which involved the construction of twin tunnels and associated road works. The employer engaged subcontractors and labour hire workers to perform substantial preliminary works associated with the tunnels’ construction. The CFMEU (as it then was) did not make an agreement with the employer and opposed approval of the agreement, which was made with the AWU on a number of grounds, including that the conduct of preliminary works rendered the enterprise no longer ‘genuinely new’.

[81] The entire analysis of this ground of objection is set out in 3 paragraphs of the decision which I reproduce below:

“[8] The evidence established that preparatory work had begun on the North Connex project. That work included demolition of housing at the site, work preparatory to excavating the mainline tunnels including excavation of access shafts, temporary surface road works to allow construction vehicle access and to provide a construction corridor, and bringing high voltage power to the tunnel sites. When compared to the scale of this $2.8 billion four year project these preparatory works are relatively small scale. The work covered by the Agreement is estimated to be worth around $500 million. There are around 300 workers currently employed by sub-contractors and labour hire agencies to carry out the preparatory work.

[9] The CFMEU submitted that the scale of the work went beyond preparatory work and meant that it was no longer a new project. The so called preparatory work was in fact a substantial part of the overall project and the work to be covered by the Agreement could not be seen as a separate project.

[10] I consider that the evidence of Mr Clothier establishes that the joint venture is a genuine new enterprise established for the purpose of undertaking the tunnel work for the North Connex project. I am also satisfied that the preparatory work is distinguishable from that work.This is consistent with the finding of Justice Rares in National Union of Workers v HP Distribution Pty Ltd:

“Indeed, the expressions “are establishing” and “propose to establish” in each of ss 172(2)(b)(i) and (3)(b)(i) indicated that one of the two scenarios might exist and that preparatory steps, even of a very substantial nature, would not necessarily disqualify an agreement from being a greenfields agreement for the purposes of s 72(2) or (3).” 100

[82] I make a number of observations about the decision. First, it is not clear whether the work undertaken by subcontractors and labour hire workers before the greenfields agreement was made was work that was part of a single contract which the employer was a party or whether it was a separate parcel of work. Work on a civil construction project may be required to be undertaken pursuant to a single contract for the delivery of the project or it may be segmented into particular packages each of which is separately contracted. Secondly, the observations at [10] of the decision suggest that the enterprise of the joint venture was the “undertaking of the tunnel work for the North Connex project” and that the “preparatory work is distinguishable from that work.” This is consistent with the separation of packages of work approach to some civil construction projects as I have already noted.

[83] Thirdly, if in Bouygues the preparatory works undertaken before the greenfields agreement was made was work contemplated by the same contract as the tunnelling work, then respectfully, I would disagree with the conclusion reached in that decision. Such a conclusion appears to me on the limited facts disclosed in the decision to be inconsistent with the notion that the civil construction project is establishing or is proposed to be established, rather than having already been established. In my view, the conclusion is plainly wrong. For these reasons, the decision in Bouygues is of no assistance in ascertaining whether in respect of these applications the Agreements relate to a genuine new enterprise that the Joint Venture Partners engaged in the CPBJHJV are establishing or propose to establish.

[84] It is also of no assistance to suggest as the Joint Venture Partners in their submissions appears to do, that the construction work undertaken by it on the WGT Project as at 9 November 2018 must be understood by reference to how that work fits into and relates to the “broader genuine new enterprise”. 101 Presumably, that broader genuine new enterprise is a reference to its contentions noted above about the “principal works” or “principal elements” of the WGT Project. It seeks to make good this point by inter alia pointing to the fact that the October 2018 Report discloses102 that “the overall construction of the project works stands at a mere 3.59% completion” and “the 6 construction zones range from 0% completion at the lowest end, to 6.08% completion at the highest end.”103

[85] It is to be remembered that the enterprise is a substantial civil construction project having many elements with a construction timeframe spanning, on present indications, five years. It is not a newly opened retail outlet which on opening might be trading but has no business or customers and which might be said at that point it is merely an “establishing business”. Referring to the fact that the construction completed as at 9 November 2018 stands at “merely” 3.59% as an indicator of whether a civil construction project is established, is akin to saying in relation to a building construction project on completing construction of the first story of a 50 story building, that as “merely” 2% of the construction has been completed, the project is only establishing. Moreover, the 3.59% of overall construction completion on the WGT Project and 6.08% of the Tunnel works is not concerned only with errecting temporary fences around the various construction sites or clearing the sites of debris. As the earlier mentioned Progress Reports reveal, construction progress involves progress on substantive works, and as the CPBJHJV itself boasts in its October 2018 Report, “[D]uring the month of October, the project saw significant progress across all seven major construction sites . . .” and “[A] major construction highlight this month was the completion of the Northern Portal piling works - which saw the installation of one thousand piles!” 104

[86] The delivery of the package of works that the Joint Venture Partners engaged in the CPBJHJV have been contracted to design and construct pursuant to the D&C Subcontract, had by 9 November 2018, well and truly commenced in both a design and relevant a construction sense. If it had not, the Victorian Government and Transurban might well ask what value they have reaped from the $864,576,710.00 paid to the Joint Venture Partners as at that date. The enterprise to which the Agreements relates was established and was not an enterprise that was establishing. Nor was it one that was proposed to be established.

[87] As the factual material earlier set out discloses, by 9 November 2018, a great deal of work had been undertaken towards the delivery of the package of works for which Joint Venture Partners engaged in the CPBJHJV have been contracted:

  As at 20 January 2018 and since entering into the D&C Subcontract, the CPBJHJV had claimed payment for executed works associated with D&C on 17 December and 18 January in the amounts of $16,890,687 and $24,787,611 respectively, or a total of $41,678,298. 105 This represents approximately 0.61% of the total project value to which earlier reference was made;

  By 20 October 2018, the CPBJHJV had claimed payment for executed works in the amount of $864,576,710 106 representing approximately 13% of the total project value;

  As at October 2018, approximately 20% of the time estimated for the completion of the WGT Project had elapsed;

  The total WGT Project headcount as at 20 January 2018 was 158 (excluding design resources) 107 whereas by 20 October 2018 the total WGT Project headcount was 1,643;108 and

  As at 20 January 2018, there had been a total of 439,693 working hours recorded for the WGT Project. 109 By 20 October 2018, there had been recorded a total of 2,432,224 working hours for the WGT Project.110 Of this total amount, 323,884 working hours are recorded to have been worked on the WGT Project between 21 September 2018 and 20 October 2018.111

[88] All of this is in connection with work of the enterprise. Moreover, as part of the construction, significant numbers of permanent piling work had been completed, the shafts for the main sewer had been dug for tunnel boring commencement, they had been shotcreted and boring had commenced, and bridge beams had been installed on public roads. 112

[89] It is evident that by 9 November 2018 the actual activity undertaken by the CPBJHJV was undertaken for the purpose delivering the package of works the subject of the D&C Subcontract and for commercial reward. The enterprise was established.

Conclusion

[90] For the reasons given, I do not consider that the Joint Venture Partners have established on the balance of probabilities that as at the date the Agreements were made, they were establishing or proposing to establish a genuine new enterprise to which the Agreements related. Therefore, as the jurisdictional fact in s.172(2)(b)(i) of the Act has not been made out, the applications to approve the Agreements must be dismissed.

Order

[91] The applications in AG2018/6254 and AG2018/6255 are dismissed.

DEPUTY PRESIDENT

Appearances:

J Forbes and A Pollock of Counsel for CPB Contractors Pty Limited & John Holland Pty Ltd.

H Borenstein QC and J Fetter of Counsel for the Construction, Forestry, Maritime, Mining and Energy Union and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia.

JE Hartley of Counsel for The Australian Workers’ Union.

Hearing details:

2019.

Melbourne:

January 9, 10, 11 and 15.

Further written submissions:

Applicants, 22 January 2019.

AWU, 29 January 2019.

CEPU and CFMMEU, 29 January 2019.

Printed by authority of the Commonwealth Government Printer

<PR705145>

 1   The total cost for the WGT Project including the separate Monash Freeway Upgrade ($283 million) and the Webb Dock Access Improvement Works ($62 million) is $6,685 million. The $6,340 million project cost figure is calculated by deducting the cost of the Monash Freeway Upgrade and the Webb Dock Access Improvement Works from $6,685 million; Court Book, Volume 1 at pp.523-524

 2   Exhibit 7, Volume 3, Tab 18, Monthly D&C Phase Progress Report November 2018 at p.7

 3   Court Book, Volume 1 at p.521

 4   Ibid at pp.530-531

 5   Ibid at pp.521–522

 6   Ibid at p.522

 7   Ibid at p.523

 8   Ibid at p.536

 9   Ibid at p.535

 10   Ibid at p.500

 11   Ibid

 12   Ibid at p.534

 13   Ibid

 14   Ibid

 15   Ibid at p.501

 16   Ibid; also at p.535

 17   Ibid at p.502 and p.535

 18   Ibid at p.536

 19   Exhibit 3 at [7]-[8] and Attachment AE-1 and AE-2; Court Book, Volume 2 at pp.1247–1248 at [7]-[8], pp.1257-1258A

 20   Court Book, Volume 1 at p.537

 21   Ibid at p.606; Exhibit 1 at Attachment AV-6 (099)

 22   Court Book, Volume 2 at p.1249 at [12]; Exhibit 3 at [12]

 23   Court Book, Volume 2 at pp.1249–1253 at [13]–[49]; Exhibit 3 at [13]-[49]

 24   Transcript at PN318 – PN319; PN359 – PN360; Exhibit 6

 25   Court Book, Volume 1 at p.537

 26   Ibid

 27   Ibid at p.523

 28   Ibid at p.630; Exhibit 1 at Attachment AV-7

 29   Ibid at pp.569 – 652; Exhibit 1 at Attachments AV–5, AV–6 and AV–7

 30   See Exhibit 7, Volume 1, Tab 8, Monthly D&C Phase Progress Report No.9 January 2018; Transcript at PN736–PN739

 31   Court Book, Volume 2 at p.1254 at [57]-[58]; Exhibit 3 at [57]-[58]

 32   Ibid at [59]

 33   Ibid at p.1250 at [21]–[22]

 34   Ibid at [23]; p.1259; Exhibit 3 at Attachment AE-3

 35   Ibid at [24]; p.1261; Exhibit 3 at Attachment AE-4

 36   Ibid at [25]; pp.1262-1272; Exhibit 3 at Attachment AE-5

 37   Ibid at [26]; pp.1273-1275; Exhibit 3 at Attachment AE-6

 38   Ibid at [27]

 39   Ibid at pp.1250-1253, 1255 at [28]-[52], [64]-[68]

 40   Exhibit 7, Volume 3, Tab 15, Monthly D&C Phase Progress Report August 2018 at p.41

 41   See for example Exhibit 20, Folder 2, Tab 9, Doc ID CAT03.001.3086 and CAT03.001.3376

 42   Court Book, Volume 2 at pp.1253 at [51] and p.1280; Exhibit 3 at Attachment AE-8

 43   Ibid at p.1255 at [67] and pp.1285-1286; Exhibit 3 at Attachment AE-11

 44   Ibid at pp.1253 and 1256 at [53], [69]

 45   See Exhibit 7

 46   The December 2017 Monthly Progress Report is not in evidence

 47   Exhibit 7, Volume 3, Tab 13

 48   Ibid at p.5

 49   See Exhibit 7, Volume 3, Tabs 14-16

 50   Ibid at Tab 17 at p.7

 51   Ibid at p.29

 52   Ibid at pp.33-35

 53   Ibid at pp.39–40

 54   Ibid at pp.43–44

 55   Ibid at p.50

 56   Ibid at Tab 18, Monthly D&C Phase Progress Report November 2018 at pp.44–45

 57   Ibid at Tab 17 at p.86

 58   Ibid at p.87

 59   Ibid at Tab 18 at p.86

 60   Ibid

 61   Ibid at Volume 3, Tab 17 at p.48

 62   Ibid at p.86

 63   Ibid at p.14

 64   Ibid

 65   See s.172(4)

 66   See s.185(6)

 67   For example, ss.173, 174, 176, 180, 182(1) and (2) and 186(2)(a), among others, operate only in respect of an enterprise agreement that is not a greenfields agreement

 68   National Union of Workers, New South Wales v HP Distribution Pty Ltd (2013) 210 FCR 250; (2013) 231 IR 263 at [34]

 69   Ibid; see also Patrick Cargo Pty Ltd & Transport Workers’ Union of Australia (2002) 115 IR 443 at 446-447

 70   Applicant’s Outline of Submissions dated 21 December 2018 at [9]

 71   Court Book, Volume 1 at p.5 (clause 1.6.18 - Tunnelling Agreement) and at p.153 (clause 1.6.18 - Civil Surface Works Agreement)

 72   Submission of CFMMEU & CEPU dated 7 December 2018 at [5]-[19] and [28]-[37]; Outline of Submissions by The Australian Workers’ Union dated 7 December 2018 at [12]

 73   The Hon Daniel Andrews MP, ‘New Project To Reduce Congestion On West Gate Bridge Progresses’ (Media Release, 30 April 2015)

 74   The Hon Daniel Andrews MP, ‘Second River Crossing Fully Funded and Out to Market’ (Media Release, 10 May 2016)

 75   The Hon Luke Donnellan MP, ‘World Class Shortlist for Vital Second River Crossing’ (Media Release, 21 June 2016)

 76   The Hon Daniel Andrews MP, ‘Only The Best For The West With 6000 New Jobs’ (Media Release, 2 April 2017)

 77   Exhibit 7, Volume 1, Tab 3, West Gate Tunnel Project Monthly Progress Report No.3 July 2017 at p.5

 78   The Hon Daniel Andrews MP, ‘West Gate Tunnel Contracts Signed, Construction Starts In Weeks’ (Media Release, 12 December 2017)

 79   Exhibit 7, Volume 1, Tab 8, West Gate Tunnel Project Monthly D&C Phase Progress Report No.9 January 2018 at pp.7-8

 80   Ibid at Volume 2, Tab 11, West Gate Tunnel Project Monthly D&C Phase Progress Report April 2018 at p.5

 81   Ibid at Volume 3, Tab 17, West Gate Tunnel Project Monthly D&C Phase Progress Report October 2018 at p.7

 82   Explanatory Memorandum, Fair Work Amendment Bill 2014, p.ix

 83   (2013) 210 FCR 250; (2013) 231 IR 263

 84   Ibid at [30]

 85   Construction commenced in January 2018 and will end in December 2022

 86   Transcript at PN2226 and PN3123

 87   See s.172(5)(a)

 88   Applicants’ Outline of Submissions dated 21 December 2018 at [37]

 89   Ibid at [38]

 90   (2013) 210 FCR 250; (2013) 231 IR 263 at [35]

 91   Ibid at [31]-[32], [36]

 92   Submission of the CFMMEU and CEPU dated 7 December 2018 at [31]; Outline of Submissions of The Australian Workers’ Union dated 7 December 2018 at [12]

 93   Applicants’ Submissions in Reply dated 22 January 2019 at [21]–[22]

 94   Ibid at [26]

 95   See for example Applicant’s Outline of Submissions dated 21 December 2018 at [7], [9] and [36] and Applicants’ Submissions in Reply dated 22 January 2019 at [3], [4] and [10]

 96   Applicant’s Outline of Submissions dated 21 December 2018 at [36]

 97   See for example Hope v The Council of the City of Bathurst (1980) 144 CLR 1 at 8–9

 98   [2016] FWC 126

 99   Applicant's Outline of Submissions dated 21 December 2018 at [49]

 100   [2016] FWC 126 at [8]-[10]

 101   Applicants’ outline of submissions dated 21 December 2018 at [40]

 102   Exhibit 7, Volume 3, Tab 17 at p.29

 103   Applicants’ outline of submission dated 21 December 2018 at [41]

 104   Exhibit 7, Volume 3, Tab 17 at p.7

 105   Ibid at p.56

 106   Ibid at p.48

 107   Ibid at Volume 1, Tab 8 at p.53

 108   Ibid at Volume 3, Tab 17 at p.86

 109   Ibid at Volume 1, Tab 8 at p.11

 110   Ibid at Volume 3, Tab 17 at p.14

 111   Ibid

 112   Court Book, Volume 1, Tab 17 at pp.478-479; Exhibit 19