[2019] FWCA 6451

The attached document replaces the document previously issued with the above code on 16 September 2019.

The corrections to the document are as follows

1. Footnote 12 changed to ‘Ibid [154].’

2. A Full stop inserted at end of footnote 40.

3. At [22], ‘that Act’ amended to ‘the Act’.

4. Quote following [47], ‘non-judicial bod’ amended to ‘non-judicial body’.

5. At [54], comma inserted between A1 and GB11.

6. Spacing between [62] and [63].

7. At [64], ‘downer’ corrected to ‘Downer’.

8. Table following [78], capitalisation of headings corrected.

9. At [85], line 8, ‘one consider’ corrected to ‘one considers’.

Rhys James

Associate to Deputy President Beaumont

Dated 17 December 2019.

[2019] FWCA 6451 [Note: This decision and the associated agreement has been quashed - refer to Full Bench decision dated 3 March 2020 [2020] FWCFB 958]
FAIR WORK COMMISSION

DECISION


Fair Work Act 2009

s.185—Enterprise agreement

Karijini Rail Pty Limited
(AG2018/3844)

KARIJINI RAIL PTY LTD RAIL OPERATIONS PILBARA ENTERPRISE AGREEMENT 2018

Mining industry

DEPUTY PRESIDENT BEAUMONT

PERTH, 16 SEPTEMBER 2019

Application for approval of single-enterprise agreement – whether non-compliance with s 180(5) was excused by s 188(2) as considered in ‘Huntsman’ – s 190 undertaking may meet a s 180(5) concern

[1] Karijini Rail Pty Ltd (Karijini) made an application to the Commission for the approval of an enterprise agreement known as the Karijini Rail Pty Ltd Rail Operations Pilbara Enterprise Agreement 2018 (the Agreement). The Construction, Forestry, Maritime, Mining, and Energy Union (Union) objected to the approval of the Agreement on several grounds. A hearing was held on 14 December 2018 and subsequently a decision was published on 30 April 2019 (First Decision). 1 I rejected the Union’s numerous objections except for one.

[2] I concluded that the requirements in s 180(5) of the Fair Work Act (2009) (Cth) (Act) were not met. Observing that satisfaction of the requirements under s 186(2)(a) was a jurisdictional prerequisite for the approval of any enterprise agreement, I concluded that if s 180(5) had not been satisfied, I could not be satisfied the Agreement had been genuinely agreed to and it followed I could not at that stage approve the Agreement.

[3] On account of non-compliance with s 180(5), the question turned to whether the Agreement would have been genuinely agreed to but for a minor procedural or technical error made in relation to the requirements mentioned in s 188(1)(a), and whether the error was such that it was not likely to have disadvantaged the two employees (the train drivers). In addition, there was the issue of whether an undertaking under s 190 may meet the concern that the Agreement had not been genuinely agreed to under s 188 (1)(a)(i).

[4] Both parties were directed to file further materials on the issue of whether the non-compliance was excused by s 188(2) of the Act, and to address the matter of whether an undertaking under s 190 may meet the concern. Having already filed a draft undertaking in the initial proceedings, Karijini submitted a further draft undertaking that purported to address the issue raised.

[5] In short, I have approved the Agreement with undertakings. My reasons for doing so follow.

THE UNDERTAKING

Karijini’s submissions

[6] In addition to the undertakings that Karijini had already proffered in the application, it proffered to provide all employees covered by the Agreement at least the flat hourly rates contained in the train drivers’ employment contracts, and to provide a roster undertaking that reflected the current roster practice, therefore protecting the roster.

[7] Karijini submitted that the effect of the new pay undertaking was that a Railway Worker Level 3 (i.e. a mainline-qualified train driver) would now be entitled under the Agreement to an annualised remuneration in excess of $157,000. This, it said, was 53% higher than the remuneration that otherwise would be provided by the Mining Industry Award 2010 (Award). 2

[8] Karijini pressed that the Commission should now find that an explanation of the pay components in comparison to the Award, should no longer be considered a necessary part of the explanation of the Agreement, in light of the new pay undertaking. It continued that the new pay entitlement effectively rendered the original base rates, penalties and loadings in the Agreement irrelevant in a practical sense, to an employee’s consideration of whether to approve the Agreement. In other words, submitted Karijini, had the Agreement contained a term to the effect of the new pay undertaking at the time of the vote, it was plain that the two employees would not have cared about the base rates, loading and penalties under the Agreement.

The Union’s submissions

[9] The Union’s argument was that Karijini’s undertakings could not satisfy the concerns of the Commission with respect to the findings made in its decision of 30 April 2019 that the requirement in s 180(5) had not been met. Succinctly put, the Union’s view was that the new undertaking with respect to starting times would appear to have nothing to do with explaining pay rates, or other conditions, nor, did the new pay undertaking, which appeared to have the effect of increasing pay rates. Neither, stated the Union, achieved the purpose of the pre-approval step that all reasonable steps were taken to explain the terms of the Agreement and their effect.

Relevant statutory provisions

[10] An employer that will be covered by a proposed agreement may request employees who are employed at the time and who will be covered by the agreement to approve the agreement by voting for it. 3 However, before making such request, the employer must comply with the requirements of s 180.4 In this case, the relevant subsection of s 180 is s 180(5), which provides that the employer must take all reasonable steps to ensure that: (a) the terms of the agreement, and the effect of those terms, are explained to the relevant employee; and (b) the explanation is provided in an appropriate manner taking into account the particular circumstances and needs of the relevant employees.

[11] On receipt of an application for approval of an enterprise agreement, the Commission must approve an agreement if it is satisfied that each of the requirements set out in ss 186 and 187 are met. If, however, the Commission has a concern that the agreement does not meet those requirements, it may exercise a discretion to approve the agreement (subject to the limitations in s 190(3)), if satisfied that an undertaking it accepts under s 190 meets the particular concern.

[12] Set out in full, s 190 reads:

190 FWC may approve an enterprise agreement with undertakings

Application of this section

(1) This section applies if:

(a) an application for the approval of an enterprise agreement has been made under subsection 182(4) or section 185; and

(b) the FWC has a concern that the agreement does not meet the requirements set out in sections 186 and 187.

Approval of agreement with undertakings

(2) The FWC may approve the agreement under section 186 if the FWC is satisfied that an undertaking accepted by the FWC under subsection (3) of this section meets the concern.

Undertakings

(3) The FWC may only accept a written undertaking from one or more employers covered by the agreement if the FWC is satisfied that the effect of accepting the undertaking is not likely to:

(a) cause financial detriment to any employee covered by the agreement; or

(b) result in substantial changes to the agreement.

FWC must seek views of bargaining representatives

(4) The FWC must not accept an undertaking under subsection (3) unless the FWC has sought the views of each person who the FWC knows is a bargaining representative for the agreement.

Signature requirements

(5) The undertaking must meet any requirements relating to the signing of undertakings that are prescribed by the regulations.

[13] It is clear that the undertaking proffered must meet the concern that the agreement does not meet one or more of the identified requirements set out in ss 186 and 187. Section 186(2)(a) includes the requirement that the Commission must be satisfied that the agreement has been genuinely agreed to by the employees covered by the agreement. The employees covered are those persons currently employed who fall within the whole class of employees to whom the agreement might in future apply. 5 Section 188(1) sets out that for an enterprise agreement to have been genuinely agreed to by the employees covered by the agreement, the Commission must (amongst other things) be satisfied that the employer complied with ss 180(2), (3) and (5).

[14] This part of the decision is concerned with the operation and effect of ss 180(5), 186, 188(1), and 190.

CONSIDERATION

Can an undertaking assuage the Commission’s concern about non-compliance with s 180(5)?

[15] The pre-approval steps in Subdivision B of Part 2-4, in addition to the Better Off Overall Test (BOOT), are considered the protective provisions of the Act regarding agreement making. The notion of ‘protective provisions’, was traversed by both the High Court in ALDI Foods Pty Ltd v Shop, Distributive and Allied Employees Association (‘ALDI’) 6 and the Full Court in One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union.7

[16] In ALDI, discussion of the ‘protective provisions’ arose in the context of agreements made by small numbers of employees. The High Court expressed that White’s J concern in Shop, Distributive and Allied Employees Association v Aldi Foods Pty Ltd, 8 that there was something implausible in the legislature accepting that a small group of employees may be able to fix the terms and conditions of employment for all the employees who may be employed in the enterprise in the future, was adverted and rejected in Construction, Forestry, Mining and Energy Union v John Holland Pty Ltd (John Holland).9 The High Court stated that it was a concern addressed, and largely allayed, by the protective provisions of the Act relating to the right to representation, the ‘fairly chosen’ provisions of sub-ss (3) and (3A) of s 186, and, the need to pass the BOOT.

[17] However, the protective provisions are not limited to the aforementioned sections. The Full Court of the Federal Court in One Key Workforce Pty Ltd v Construction Forestry, Mining and Energy Union 10 observed that while agreements covering a small group of employees were not precluded by the Act, this did not in turn mean that ‘the Act is unconcerned with agreement-making that may undermine or subvert its preference for collective bargaining’.11 The Full Court stated that the concern ‘as the High Court observed in ALDI at [84] and [87], is addressed not by prohibition but by the Fair Work Act’s “protective provisions”‘. The Full Court continued:

Section 186(3) (the “fairly chosen” requirement) is one example of such a “protective provision”. A primary purpose of this provision is to avoid the workforce of an enterprise being broken up into artificial employee groupings with the consequence that the workforce of the enterprise is unable to bargain as a single collective: see Aerocare Flight Support Pty Ltd v Transport Workers Union of Australia [2018] FCAFC 74 at [19] (Jagot, Bromberg and Rangiah JJ). Another example of a protective provision referred to by the High Court in ALDI is the BOOT. Each of those provisions is an element of the approval process specified by Sub-division B of Pt 2-4. Like those provisions, other provisions of that sub-division, including ss 186(2) and 188, have a protective purpose. That s 188 harbours a concern directed at agreements made by a small number of employees in circumstances where the agreement covers a wider range of employee classifications is confirmed by [824] of the Explanatory Memorandum which provides: Note that where an agreement covers a large number of classifications of employees in which no employees are actually engaged there may be a question as to whether the agreement has been genuinely agreed — see clause 188. 12

[18] Informed by the Full Court that s 186(2) is a protective provision, it is nevertheless the case that if the Commission has a concern that the agreement does not meet the requirements set out in s 186, 13 the Commission can still approve the agreement if satisfied that an undertaking meets the concern.14 This appears uncontroversial given the reliance in the past of the Commission to rely on undertakings to address concerns that an agreement does not pass the BOOT.15 And yet, the contrary is true. While there is acceptance of the use of an undertaking to address a concern about an enterprise agreement not passing the BOOT - a protective provision - it appears that there is a diversity of views on whether a concern regarding non-compliance with s 180(5) can similarly be addressed. Clearly however, the protective purpose of a provision in this Part, does not preclude the use of an undertaking to meet a concern about an enterprise agreement satisfying or meeting the requirements in s 186.

[19] When construing a statutory provision, it is well accepted that a court must strive to give meaning to every word of the provision. 16 In Project Blue Sky Inc v Australian Broadcasting Authority17 (Project Blue Sky) the High Court opined ‘a known rule in the interpretation of statutes that such a sense is to be made upon the whole as that no clause, sentence, or word shall prove superfluous, void, or insignificant, if by any other construction they may all be made useful and pertinent.18

[20] In Taylor v The Owners – Strata Plan No 11564 19 (Taylor), Gageler and Keane JJ discussed the relationship between grammatical meaning, context and purpose:

Statutory construction involves attribution of legal meaning to statutory text, read in context. “Ordinarily, that meaning (the legal meaning) will correspond with the grammatical meaning… But not always”. Context sometimes favours an ungrammatical legal meaning. Ungrammatical legal meaning sometimes involves reading statutory text as containing implicit words. Implicit words are sometimes words of limitation. They are sometimes words of extension. But they are always words of explanation. The constructional task remains throughout to expound the meaning of the statutory text, not to divine unexpressed legislative intention or to remedy perceived legislative inattention. Construction is not speculation, and it is not repair20 (underlining my emphasis).

[21] The purposive approach to construction is required by s 15AA of the Acts Interpretation Act 1901(Cth). It requires that a construction that would promote the purpose of object of the Act is to be preferred to one that would not promote that purpose or object. The purpose or object of the Act is to be taken into account even if the meaning of a provision is clear. However, while s 15AA requires the Act to be construed in light of its purpose, this does not in turn mean rewriting the Act. The Commission is obliged under s 578 to take into account the object of the Act (set out in s 3), and any object of the part of this Act. Section 171, which I do not intend to detail, sets out the object of Part 2-4.

[22] With respect to the undertaking proffered by Karijini on 18 June 2019, the Union submitted that the undertaking appeared to have been proffered primarily to remedy the found deficiency with respect to s 180(5) of the Act. The Union continued that if that were the basis for the proffering of the undertaking, Full Bench authority appeared to be clear, that a failure to take all reasonable steps to explain the terms of the enterprise agreement and their effect, cannot be remedied by an undertaking. Reference was made to three decisions of the Full Bench and the findings arrived at by each. 21 Those three decisions are further considered.

[23] In Diamond Offshore General Company v Baldwin (Diamond Offshore22 the Appellant appealed the decision of the Deputy President at first instance who had dismissed the application for the approval of the Diamond Offshore General Company Enterprise Agreement 2018-2022 (Diamond Agreement). Briefly put, the application was dismissed because the Deputy President found that the Appellant had not taken all reasonable steps to ensure that the terms of the Diamond Agreement were explained to relevant employees as required in s 180(5) of the Act.

[24] Relevant to the matter before me, was the first ground of appeal. Namely, the Deputy President had erred by concluding that s 180(5) required the Appellant to explain to the relevant employees the extent to which the terms of the Diamond Agreement differed from its predecessor. The Appellant submitted that to explain the effect of a term of an agreement, an employer need only articulate the operative outcome that its text produces and that in many cases there will be no difference between an explanation of a term and an explanation of its effect.

[25] The Full Bench did not accept the Appellant’s proposition concerning the ‘operative outcome’. The Full Bench expressed that an explanation of the terms of an agreement and the effect of those terms was not limited to the operative outcome that the text of the term produces. 23 With respect to explaining the difference between the Diamond Agreement and its predecessor, the Full Bench stated that the Act did not prescribe such a requirement. However, on a fair reading of the Deputy President’s decision in Diamond Offshore, the Full Bench concluded that the Deputy President made no such finding and did not establish such a rule.

[26] In its second ground of appeal the Appellant contended that it had been denied procedural fairness albeit the Full Bench was disinclined to agree. In some of its concluding remarks the Full Bench expressed that even if there had been a denial of procedural fairness, not every such denial at first instance entitled an aggrieved appellant to a new hearing. 24

[27] However, more importantly as far as this decision concerns the matters in dispute before me, the Full Bench stated, ‘a failure to meet the requirements of that section of the FW Act is not a matter that can be cured by way of an undertaking given pursuant to s 190 of the FW Act’. 25 The basis for arriving at this conclusion was not traversed by the Full Bench and no reasoning was provided to support the conclusion. There was no suggestion in the decision that the employer was prepared to offer an undertaking, and the issue of whether a relevant undertaking could be considered part of the factual matrix when determining what explanation was required by s 180(5) simply did not arise.

[28] In Construction, Forestry, Maritime, Mining and Energy Union v Dawsons Maintenance Contractors Pty Ltd 26 (Dawsons) there were several grounds of appeal. One of the grounds included an error in finding that the employer had taken all reasonable steps to ensure relevant employees were given copies of, or had access to, material incorporated by reference into the agreement (s 180(2) step), and had explained to them the terms of the agreement (s 180(5) step).27

[29] In its consideration of the s 180(2) step, the Full Bench concluded that the s 180(2) step was a foundational matter because it was an element of the requirement that an enterprise agreement be genuinely agreed. 28 The Full Bench found that in such circumstances, undertakings were incapable of addressing any concern that may have existed about compliance with s 180(2).29 The Full Bench’s consideration was limited to the concern regarding the s 180(2) step.

[30] When it came to the consideration of whether there was a sufficient basis for the Commissioner at first instance to conclude that all reasonable steps were taken to explain the terms of the Agreement and their effect, the Full Bench did not address whether an undertaking could remedy a concern regarding the s 180(5) step. It simply observed that none of the undertakings given by the company were the subject of any explanation within the material provided by the company to its employees before the ballot.

[31] The Full Bench in Australian Workers’ Union, The v Professional Traffic Solutions Pty Ltd (Professional Traffic30 addressed the issue of whether a failure to take all reasonable steps to explain the terms of an enterprise agreement and their effect could be remedied by an undertaking. It found that the respondent’s explanation could not have been sufficient for the Commissioner at first instance to be satisfied that all reasonable steps had been taken by the employer to explain the terms of the agreement and their effect on the relevant employees. As such, the Full Bench concluded this was a significant matter in the Commission’s exercise of jurisdiction in approving the agreement. Consequently, the Commission decided that a failure to take the matter into account amounted to error of the kind in House v King.31

[32] Attention turned to whether the error could be cured by an undertaking. The Full Bench stated that such remedy cannot be open to the Commission for two reasons. 32 The first was that there was no stay of the Commissioner’s approval decision.33 Therefore, it was not open to an appeal bench to accept further undertakings in respect to an appeal of an agreement which had been approved and was obviously in current operation and effect.34

[33] The second reason was that the Full Bench could not see how any undertaking could prospectively cure an error arising from the Commissioner’s consideration of the pre-approval steps of the agreement. 35 The Full Bench concluded that it was not possible to prospectively rectify an error found in respect to the Commission’s satisfaction of the agreement being ‘genuinely agreed’ to by the employees.36 According to the Full Bench, it was fatal to the application for the agreement being approved.37

[34] In Professional Traffic the employer had relied on a simple statement confirming that the agreement in question was explained to relevant employees when handed out, and the same employees were encouraged to ask questions. When responding to whether the agreement contained any less beneficial terms than those in the reference instrument, the employer stated it did not. The Full Bench stated that the response could only have been predicated on a view that the agreement contained no less beneficial terms than the relevant modern award. 38 The Full Bench considered that the view expressed was incorrect and it therefore followed that the employer’s explanation could not amount to a taking of all reasonable steps to explain the terms of the agreement and their effect.39

[35] The circumstances encountered by the Full Bench were specific to that case. Evidence adduced by the employer was limited to what was in effect, a bare statement about the explanation, and the explanation provided had not traversed the less beneficial terms. It was in those circumstances that the Full Bench expressed that it could not see how any undertaking could prospectively cure such an error regarding the pre-approval steps. Their perspicacity perhaps did not extend beyond the facts which were before them – understandably so.

[36] In the decision of BGC Contracting Pty Ltd T/A BGC 40 (BGC), BGC, referring to the role of undertakings, aptly observed in its submissions that whilst the application process is clear in respect of concerns about the BOOT, the process with respect to other requirements such as compliance with s 186(2)(a), which is the subject of the genuine agreement undertaking, is perhaps less clear.41 The company continued with its submission asking rhetorically, how the Commission could be satisfied that an undertaking accepted under s 190(3) would meet a concern about genuine agreement in circumstances where that concern relates to events prior to the vote.42 In answering its rhetorical question, the company contended, according to the Deputy President, that it was no answer to suggest, as the unions had in that case, that such concerns were incapable per se of being met with an undertaking.43

[37] It is a correct proposition that a literal and contextual reading of s 190(1)(b) shows that Part 2-4 comprehends that concerns about each of the approval requirements set out in ss 186 and 187 are at least capable in-principle of being addressed by an undertaking. 44 As was observed by the Deputy President in BGC, were s 186(2)(a) intended to have been immune from s 190, parliament would have dealt with it as a standalone approval requirement.45

[38] It is therefore not entirely clear why previous Full Benches have determined that s 190(1)(b) has no work to do when the concern emanates from the agreement not meeting the requirements in s 186(2)(a) – specifically ss 188 and 180(5). I have, while writing this decision, seen fit to refer to the decision in Project Blue Sky. This decision of the High Court informs this Commission that a known rule of the interpretation of statutes is that no clause, sentence or word shall prove superfluous, void or insignificant – if by other construction they may all be made useful and pertinent. 46 The Deputy President adopts such an approach in BGC:

One can readily conceive of circumstances which might cause concern about whether an agreement has been genuinely agreed to by the relevant employees but be amenable to an undertaking capable of acceptance and meeting the concern, thus enabling the agreement to be approved. Whether an undertaking can meet a concern about genuine agreement must, it seems to me, depend on the reason for the concern. A simple example will suffice. Consider the position of an enterprise agreement the subject of an approval application which makes provision for employees working on a Sunday to receive penalty payments in accordance with the employer’s “policy on working on Sundays”. The agreement makes provision for the employer’s “policy on working on Sundays” to be incorporated by reference. The policy sets out that ordinary time work on a Sunday will be payable at double time and overtime work on a Sunday will be on a voluntary basis but, if worked, employees will be paid at treble time. Consider that the employer did not comply with s.180(2) in relation to the policy incorporated by reference. Consider also that the employer, in discharging its obligation under s.180(5), provided an explanation to relevant employees that the agreement made provision for the employer’s “policy on working on Sundays” to be incorporated into the agreement by reference, that the effect of that term would be that the policy bound the employer and the employees covered by the agreement and that as a consequence ordinary hours worked on a Sunday by employees would be paid at double time, that overtime work on a Sunday would be voluntary and if such overtime is worked, employees so working would be paid at treble time.

On its face, the failure to provide a copy to relevant employees of the employer’s policy raises a concern that the employees did not genuinely agree to the agreement because of the employer’s failure to comply with s.180(2). Does it follow that the agreement cannot be approved if an appropriate undertaking is proffered and accepted by the Commission? It seems to me the answer is likely to be no. One can readily envisage an undertaking being proffered to meet the concern. The employer could proffer an undertaking that the employer’s “policy on working on Sundays” will not be incorporated as a term of the agreement. In addition, the employer could undertake that overtime work on a Sunday will be voluntary, and that it will pay any employee working ordinary hours on a Sunday at double time and will pay any employee working overtime on a Sunday at treble time.

The effect of the undertaking is that the document which was incorporated by reference but not supplied to relevant employees, does not form part of the agreement. The effect of the undertaking is also to confirm the terms of the agreement about which the relevant employees received an explanation as required by s.180(5), and upon which the relevant employees voted to approve the agreement. The effect of the undertaking seems to me not likely to cause financial detriment to any employee covered by the agreement, nor likely to result in substantial changes to the agreement. It otherwise appears to meet the concern namely, that employees may not have genuinely agreed to the agreement by reason of the employer’s failure to comply with s.180(2) of the Act. There has been compliance with that subsection because the relevant material is not to be incorporated. But the terms as to Sunday work in the Agreement are the same, both before and after the undertaking is accepted, there can thus be satisfaction as to s.186(2)(a) of the Act. 47

[39] BGC does not stand for the proposition that every breach of the pre-approval requirements can be met by an undertaking. Each case will of course turn on its own facts. The Deputy President elaborated upon this point:

…[N]ot every defect which has the effect of not satisfying the Commission as to the matter in s.186(2)(a) is capable of being rectified by way of undertaking. Each case will turn on the nature of the defect in compliance, the Commission’s consequent concern, and the nature of the undertaking proposed. It further accepts that in most cases, a concern that an agreement does not meet the requirement in s.186(2)(a) will be incapable of being met by an undertaking, however this is not because such concerns are incapable in principle of being the subject of an appropriate undertaking, rather it is because the policy purpose to which s.186(2)(a) is directed is unable to be met by the undertaking proposed in all of the circumstances. 48

[40] That undertakings can be used to address concerns about each of the approval requirements set out in ss 186 and 187, appears to have been accepted by the Full Bench in Construction, Forestry, Maritime, Mining and Energy Union v Ditchfield Mining Services Pty Limited (Ditchfield). 49

[41] The purpose or policy of those provisions dealing with enterprise agreements, bears on the question of whether an undertaking can meet the Commission’s concern that the employer did not comply with ss 180(2), (3) or (5) (pre-approval steps). The objects of Part 2-4 include the provision of a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits.

[42] The obligation under s 180(5) to take all reasonable steps to explain to relevant employees the terms of an enterprise agreement and the effect of those terms is an important function of the agreement making scheme established by Part 2-4 of the Act. 50 As explained, s 186(2) requires the Commission to be satisfied that the agreement is ‘genuinely agreed to’ by the employees covered by it. The Act informs us that ‘genuinely agreed to’ in this context requires the Commission to be satisfied that the employer complied with s 180(5).

[43] In Ditchfield the Full Bench stated that the evident purpose of the section was to ensure that employees are as fully informed as practicable about the terms and effect of the terms of a proposed enterprise agreement before voting on whether to approve it. 51 The Full Bench continued that an employer’s discharge of it obligation under s 180(5) is intended to enable employees to know what they are being asked to agree to, and to understand how their wages and working conditions might be affected by voting in favour of an agreement.

[44] While s 186(2) is a protective provision, and while there appears to have been consternation on the part of the Union that an undertaking cannot be relied upon to overcome a deficiency in an explanation given to employees in the period leading up to a vote on an enterprise agreement (ss 188(1)(a)(i) and 180(5)), I am satisfied in principle that it can. Such an interpretation is not, in my view, inconsistent with the statutory purpose of s 186(2). To conclude otherwise would read into s 190(1)(b) a fetter or limitation not otherwise expressed regarding the concern not meeting the requirements set out in s 186, with particular reference to ss 188(1)(a)(i) and 180(5). As was stated in Taylor, the constructional task remains throughout to expound the meaning of the statutory text, not to divine unexpressed legislative intention or to remedy perceived legislative inattention.

[45] Of course, my view is predicated upon the acceptance that each case will turn on the nature of the defect regarding compliance with a pre-approval step (the reason for the concern), 52 the Commission’s consequent concern, and the undertaking proposed.53 Consideration of whether the undertaking meets the aforementioned concerns would include taking into account whether the protective purpose of ss186(2) and 188 is not rendered nugatory. Where the undertaking operates to defeat or circumvent the statutory purpose, then it may not be concluded that an undertaking meets the concern. As was observed in BGC, in most cases, a concern that an agreement does not meet the requirement in s 186(2)(a) will be incapable of being met by an undertaking.

[46] In BGC, the applicant advanced that the Commission’s acceptance of an undertaking is predicated upon an analysis under s 190(3) of the undertaking’s practical effect. It continued that the Act does not impose the requirements set out in ss 186 and 187 for their own sake, rather each requirement seeks to avoid particular negative effects or consequences that might otherwise arise from the application of an enterprise agreement. This contention aligns with the ‘protective’ nature of the pre-approval steps to ensure that the relevant employees are

fully informed as practicable about the terms and effect of the terms of a proposed enterprise agreement before voting on whether to approve it.

[47] Quite rightly, the Union made the submission that BGC is a single member decision, and the Commission as constituted in this matter, should not depart from the position of the Full Bench decisions to which the Union has kindly referred me to. As the Full Bench of the Australian Industrial Relations Commission observed in Cetin v Ripon Pty Ltd (T/as Parkview Hotel:

Although the Commission is not, as a non-judicial body, bound by principles of stare decisis, as a matter of policy and sound administration it has generally followed previous Full Bench decisions relating to the issue to be determined, in the absence of cogent reasons for not doing so. 54

[48] Yet in Ditchfield, it was evident that the Full Bench considered that undertakings can be used to address concerns about each of the approval requirements set out in ss 186 and 187. And while the Full Bench in Professional Traffic provided reasons on whether a failure to take all reasonable steps to explain the terms of an enterprise agreement and their effects, could be remedied by an undertaking, such reasoning appears limited to the facts before the Full Bench at that time. The decision of Professional Traffic mirrored not the perspicacity demonstrated by the Deputy President in BGC – where further thought and cogent reasoning was given to the issue. I therefore have no hesitancy in departing, if it is the case I am, from the obiter in Diamond Offshore, Dawsons and Professional Traffic.

Does Karijini’s new pay undertaking address the Commission’s concern about the s 180(5) non-compliance

[49] In addition to the undertakings that Karijini had already proffered in the application, it proffered an additional undertaking to remove, what it referred to as the ‘Pay Components Comparison’, which was the need to provide a comparison of the rates, penalties, loadings and allowances in the Agreement as against the Award . The undertaking reads:

Without limiting the pay entitlements that employees otherwise have under the Agreement, the total gross amount that Karijini will pay an employee covered by the Agreement with respect to every pay cycle (not including superannuation) will be at least H x R where:

  H is the number of hours that the employee worked (or took as paid leave) during that pay cycle; and

  R is the relevant flat hourly rate set out below:

For Railway Worker Level 3 (maximum-term): $71.94 per hour
For Railway Worker Level 2 (maximum-term): $56.99 per hour
For Railway Worker Level 1 (maximum-term): $55.30 per hour

For Railway Worker Level 3 (casual): $77.97 per hour
For Railway Worker Level 2 (casual): $62.37 per hour
For Railway Worker Level 1 (casual): $60.52 per hour

To avoid doubt, the hours rates set out above are all-inclusive flat rates. For the purposes of calculating the minimum amount that Karijini undertakes to pay under this undertaking, no penalties, loadings or allowances of any kind are to be applied to these rates. These rates are fixed and are not subject to indexation under clause 5.3 of the Agreement (the Hourly Rate Undertaking).

[50] Karijini submitted that the further undertaking resulted in a new pay entitlement that far exceeded the train drivers’ pay entitlements that would otherwise exist under the Agreement – that is base rates, penalties, and loadings as they would have applied to the roster structure protected by the previous undertakings. In Karijini’s view, the new pay entitlement effectively rendered the original base rates, penalties and loading in the Agreement irrelevant, in a practical sense, to an employee’s consideration of whether to approve the Agreement.

[51] According to Karijini, providing a comparison between the penalties, loadings and allowance in the Award as against the Agreement should no longer be considered to be a reasonable step required by s 180(5) because of the overwhelming superiority of the remuneration under the Agreement (with the further undertaking) compared to the Award. To support its contention, Karijini turned to the decision of the Commission in Downer EDI Mining – Blasting Services Pty Ltd 55 in which it was said that the size of the remuneration benefit of an enterprise agreement over the reference instrument was an important factor in determining whether an employer was required under s 180(5) to provide a comparison between the agreement and award.

[52] At the initial hearing, evidence was given by Mr Graham Butler, Karijini’s Director, about the train drivers’ salary. Attached to his witness statement (Exhibit A1), were the letters of offer for the two train drivers. The schedules to the letters of offer (Exhibit A1 GB11 and GB12) provided:

[53] In the First Decision at paragraph [133], I set out some of Mr Butler’s evidence regarding the information he conveyed to the two train drivers about their salary. It is timely to provide further detail of that purported dialogue:

[54] The flat rates that are proffered in the Hourly Rate Undertaking match those that are provided in the letters of offer (Exhibit A1, GB11 and GB12). Further, those rates in the Hourly Rate Undertaking are, as is the case with the letter of offer, flat rates of the same amounts. The letters of offer clearly set out that such rates are in excess of the minimum pay rates under the modern award and ‘absorb all entitlements’ arising under the modern award. At clause 3.3 of the letter of offer, the entitlements from the modern award that are absorbed into the flat hourly rates are clearly detailed, with reference to the clauses where such entitlements can be found in the relevant modern award. The dialogue between Mr Butler and the two train drivers, includes Mr Butler informing the train drivers that the ‘current rate in your LOO is well in advance of the enterprise agreement rate and needs to pass the BOOT Test’.

[55] In the First Decision, I expressed that an employee’s entitlement as far as base rates of pay, penalties and allowances are concerned, are fundamental considerations for any employee.
Section 186(2) requires that the Commission must be satisfied that the enterprise agreement has been genuinely agreed to and in that respect the term ‘genuinely agreed to’ is given meaning by s 188(1). Section 188(1)(a)(i) informs the reader that an enterprise agreement has been genuinely agreed to by the employees covered by the agreement if the Commission is, amongst other matters, satisfied that the employer has complied with s 180(5). I had concluded, in light of the explanation provided, that no such state of satisfaction had been reached.

[56] Karijini had imparted an explanation concerning the rates of pay to the train drivers. However, the explanation provided focused on the rates of pay in the letters of offer (or ‘IFA’) rather than those detailed in the Agreement. Mr Butler went to some length to specify the operation of the flat rate, and that it would encompass all penalties, was well in advance of the enterprise agreement rate and needed to pass the BOOT. The letters of offer clearly specified the award entitlements for which the hourly rate compensated the employee. Yet, the explanation concerning the rates of pay in the Agreement fell short of taking all reasonable steps to ensure that the terms of the Agreement and their effect were explained. Notwithstanding, I concluded that the train drivers understood that the Agreement passed the BOOT.

[57] The effect of the Hourly Rate Undertaking is that the explanation that Karijini provided before requesting that the train drivers approve the Agreement by voting on it, now aligns with the entitlement set out in the Hourly Rate Undertaking. Part of the explanation provided by Mr Butler was given in response to the question of how the salary was made up. It appears that perhaps the use of the word ‘salary’ may have led Mr Butler to discuss the contractual salary notwithstanding that the explanation was provided in the context of an enterprise agreement making process.

[58] When one of the train drivers asked how the salary was made up, I found the explanation was, with respect, lacking in clarity. However, I did not conclude that there were other reasons for believing that the Agreement was not genuinely agreed to because of the explanation provided.

[59] The steps taken fell short of ‘all reasonable steps’. However, it was not the case that the consent of the employees was not informed. It was evident that at material times the employees were asked whether they had any questions and were provided with opportunities to query answers provided.

[60] While it may have been the case that there were shortcomings with the answers provided, such that s 180(5) was not complied with, I am not persuaded that the non-compliance materially affected the bargaining or approval process for the Agreement. The Hourly Rate Undertaking guarantees a flat rate which was explained to the two train drivers prior to them voting on the Agreement. It does not of course alter, that the explanation provided concerned contractual rates that were not included in the Agreement at the time of the vote. However, it is not inconceivable that explanations provided concerning the terms of an enterprise agreement and their effect under s 180(5), may not always reflect the final terms (and their effect) in circumstances where an undertaking has been accepted under s 191(1) to address a s 190(1)(b) concern.

[61] The effect of the Hourly Rate Undertaking is that the explanation that was provided to the train drivers for the purpose of satisfying s 180(5) is now mirrored in the content of the Hourly Rate Undertaking. It was that explanation – notwithstanding it covered information about the contractual salary and the Agreement, which ultimately the train drivers received and thereafter relied upon arguably in part, to vote to approve the Agreement.

[62] The reason for my concern in the First Decision was the lack of explanation concerning the comparison of the rates of pay and allowances between the Award and the Agreement and what the allowances compensated for, regarding Award entitlements. I have concluded that this concern is assuaged by the Hourly Rate Undertaking.

[63] By way of observation, I note that my concern arose in a context where modelling indicated that a Railway Worker Level 4 classification on the roster committed to in Karijini’s initial undertakings proffered, a difference between Agreement and Award of approximately 5.33%.

[64] In Downer EDI Mining – Blasting Services Pty Ltd 56 it was said that the size of the remuneration benefit of an enterprise agreement over the reference instrument was an important factor in determining whether an employer was required under s 180(5) to provide a comparison between the enterprise agreement and the modern award. With the percentage difference between the Agreement and the Award now amounting to approximately 30% for a level 2 train driver and 41% for a level 3 (when working 2 weeks on 2 and weeks off, 12 hours per shift), it is open to find that all reasonable steps to explain the terms of the Agreement and the effect of those terms, did not necessitate the inclusion of comparator information between the Agreement and Award to the level of detail set out in the First Decision.

[65] If I am wrong that the Hourly Rate Undertaking meets the concern regarding the s 180(5) non-compliance, it remains the case that such non-compliance is excused by s 188(2) of the Act for the following reasons.

WHETHER A FAILURE TO COMPLY WITH S 180(5) CAN BE EXCUSED BY S 188(2)

Submissions of Karijini

[66] Karijini submitted that if despite the Hourly Rate Undertaking, s 180(5) required it to provide the train drivers with the Pay Components Comparison, Karijini’s failure to do so was excused by s 188(2). The basis for Karijini’s contention – the non-compliance with s 180(5) was a minor procedural error that is unlikely to have disadvantaged the train drivers in relation to the requirement in s 180(5).

Submissions of the Union

[67] The Union submitted that when one considered the description of ‘procedural requirement’ in the Full Bench decision of Huntsman Chemical Company Australia Pty Limited T/A RMAX Rigid Cellular Plastics & Others 57 (Huntsman), the requirement differed in character from the requirement in s 180(5). The Union’s contention was that s 180(5) did not require a particular process or course of action. The ‘reasonable steps’ referred to in the section, were not particular in the sense of being a prescribed number, date or form, but rather were steps whose number and content varied depending on the circumstances in which an agreement was made.

[68] Referring to the decisions of Flick J in One Key Workforce Pty Ltd v Construction Forestry, Mining and Energy Union 58 and the Full Court of the Federal Court in One Key Workforce Pty Ltd v Construction Forestry, Mining and Energy Union,59 the Union submitted that the obligation to take all reasonable steps to explain the agreement was one of substance and not mere formality, or form.

[69] The Union continued that the Commission had already found that Karijini had failed to take all reasonable steps to explain the terms and effect of the Agreement. For that purpose, the Commission had evaluated which steps were reasonably necessary for the agreement to be genuinely agreed. Therefore, the failure to undertake all reasonable steps to explain the terms and effect of the Agreement could not be characterised as merely procedural because of the fundamental considerations that failure to explain disregarded.

[70] If it were the case that the Commission did not accept its contentions and a finding was made that the requirement under s 180(5) was procedural, then, according to the Union, it could not be accepted that such a fundamental consideration was minor.

Relevant statutory provisions

[71] Section 186(1) requires the Commission to approve an enterprise agreement if the requirements in ss 186 and 187 are met. For present purposes, of relevance is s186(2)(a), which provides:

(2) The FWC must be satisfied that:

(a) if the agreement is not a greenfields agreement – the agreement has been genuinely agreed to by the employees covered by the agreement…

[72] Section 188(1) provides that an enterprise agreement has been ‘genuinely agreed to’ by the employees covered by the agreement, for the purpose of s 186(2)(a) if the Commission is satisfied of the matters set out in s 188(1)(a)-(c) as follows:

188 When employees have genuinely agreed to an enterprise agreement

(1) An enterprise has been genuinely agreed to by the employees covered by the agreement if the FWC is satisfied that:

(a) the employer, or each of the employers, covered by the agreement complied with the following provisions in relation to the agreement:

(i) subsections 180(2), (3) and (5) (which deal with pre-approval steps);

(ii) subsection 181(2) (which requires that employees not be requested to approve an enterprise agreement until 21 days after the last notice of employee representational rights is given); and

(b) the agreement was made in accordance with whichever of subsection 182(1) or (2) applies (those subsections deal with the making of different kinds of enterprise agreements by employee vote); and

(c) there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to be the employees.

[73] The new s 188(2) provides a means for finding that an agreement has been genuinely agreed to despite minor procedural or technical errors:

(2) An enterprise agreement has also been genuinely agreed to by employees covered by the agreement if the FWC is satisfied that:

(a) the agreement would have been genuinely agreed to within the meaning of subsection (1) but for minor procedural or technical error made in relation to the requirements mentioned in paragraph 1(a) or (b), or the requirements of sections 173 and 174 relating to a notice of employee representational rights; and

(b) the employees covered by the agreement were not likely to have been disadvantaged by the errors, in relation to the requirements mentioned in paragraph (1)(a) or (b), or the requirements of sections 173 and 174.

[74] In the circumstances of this matter, I am satisfied that s 188(2) applies as the Commission had clearly not decided the application on or before 12 December 2018.

[75] In the decision of Huntsman the Full Bench stated that s 188(2) is engaged only where the Commission would have been satisfied that an agreement was ‘genuinely agreed’ to within the meaning of s 188(1) ‘but for’ errors made in relation to the particular bargaining provisions mentioned in paragraphs (1)(a) or (b). The section does not extend to circumstances where the Commission is not satisfied that an agreement was genuinely agreed to in a more general sense, as might arise in considering s 188(1)(c). 60 In the First Decision, I did not conclude that the Agreement had not been genuinely agreed to in the more general sense as captured by s 188(1)(c) of the Act.

[76] Further, for an agreement to have been genuinely agreed to under s 188(2), the Commission must be satisfied as to both matters in paragraphs 188(2)(a) and (b) before it can be said that the agreement has been genuinely agreed61

[77] The Full Bench explained that s 188(2) does not apply to all procedural or technical requirements with which an employer must comply when bargaining for an agreement. 62 The procedural or technical requirements must be ‘minor’ and must be errors made in relation to the requirements mentioned in paragraph (1)(a) or (b).63

[78] The word ‘minor’ is a limitation upon the type of errors contemplated by s 188(2)(a). 64 According to the Full Bench, what constitutes a minor error calls for an evaluative judgment having regard to the underlying purpose of the relevant procedural or technical requirement which has not been complied with and the relevant circumstances.65 The Full Bench in Huntsman set out a table of procedural or technical requirements covered by s 188(2) and potential ways in which employees may be disadvantaged in relation to minor errors.66 For the purpose of this matter the following is relevant:

Procedural or technical requirements covered by s 188(2) and potential ways in which employees may be disadvantaged in relation to minor errors

[79] Whether a failure to comply with the requirements in paragraph 188(1)(a) or (b), in for example, s 180(5), constitutes a ‘minor error’, depends on the extent of the non-compliance and the circumstances. 67

[80] When considering the definition of the word ‘error’, the Full Bench referred to the definition in the Macquarie Dictionary noting that, amongst other meanings, error meant a deviation from accuracy or correctness; a mistake, as in action, speech, etc. 68 The Full Bench concluded that an act may be intentional, in the sense that it was a deliberate act, but nevertheless constitute an ‘error’ because the person was unaware of the legal consequences of their action.69 This type of error is distinguished from circumstances where the employer embarks on a course of deliberate non-compliance. The Full Bench expressed that a proper distinction is to be made between an intentional act which unintentionally results in non-compliance with the procedural and/or technical requirements, and intentional non-compliance with those requirements, which will not constitute an error for the purpose of s 188(2).70

[81] With respect to section 188(2)(b), the Full Bench stated that in the context of the Act, the word ‘disadvantaged’ in itself suggested a deprivation which manifested in the employees covered by the agreement being prevented from substantively exercising their rights within the bargaining regime in Part 2-4. 71 However, the test itself refers to ‘the employees covered by the agreement were not likely to have been disadvantaged by the errors’.72 The word ‘likely’ in s 188(2)(b), according to the Full Bench in Huntsman, means ‘probable’, in the sense that there is an odd-on chance of it happening – the meaning being consistent with the ordinary and natural meaning of the word.73

[82] In assessing whether employees were not likely to have been disadvantaged, the Full Bench in Huntsman stated that it may be necessary to consider the particular circumstances of the employees concerned at the time the error occurred and the impact of the error on the subsequent course of bargaining. 74

Consideration

[83] As observed, a procedural requirement is one which requires an employer to follow a particular process or course of action. In Huntsman, the Full Bench clearly contemplated that s 180(5) constituted either a procedural or technical requirement, given its reference to the section in Table 2 at paragraph [74] of the decision. The Full Bench described Table 2 as examining each of the procedural or technical requirements covered by s 188(2). Within the Table, reference is made to the requirement in s 180(5)(a), its purpose and how employees may be disadvantaged by non-compliance with the section.

[84] The underlying purpose of the s 180(5)(a) requirement, is said to ensure employees understand the effect of the agreement that is to be voted on, enabling them to make an informed decision. This purpose appears to be in harmony with the notion that s 180(5) falls within the ambit of the protective provisions of Part 2-4, that is, the pre-approval requirements.

[85] Subsection 188(1)(a) of the Act, refers to the pre-approval requirements in ss 180(2), (3) and (5) and states they ‘deal with the pre-approval steps’. The Macquarie Dictionary online (Macquarie) provides an expansive definition of the word ‘step’. That definition includes ‘11. a move or proceeding, as towards some end or in the general course of action: the first step towards peace’. With regard to defining the term ‘take steps’, the Macquarie defines it as ‘to initiate a course of action’. Therefore, I consider that the use of the word ‘steps’ within s 188(1)(a)(i) connotes part of the pre-approval process or course of action required of an employer. Furthermore, it is evident when one considers s 180, subsections (4), (4B), (4C) and (6) could not, on any reading be considered ‘steps’. Albeit, s 180(6) goes some way to provide the kinds of employees whose circumstances are to be taken into account for the purpose of compliance with s 180(5)(b).

[86] When one examines the plain language of s 180(5)(a), there is again reference to ‘steps’, albeit this time there is a qualification that the ‘steps’ are those that are considered to be ‘reasonable’. Clearly, this Commission is charged with an evaluative task of determining, on an objective basis, whether the employer has taken ‘all reasonable steps’ to ensure that the terms of the agreement and their effect have been explained. The fact that s 180(5) contains an inbuilt qualifier of reasonableness, does not mean that non-compliance with s 180(5) cannot be ‘procedural’, or for that matter, a ‘minor’ error within the meaning of s 188(2). As was observed in Karijini’s submissions, in its Senate submission, the ACTU opposed s 188(2) on the basis that ‘many of the requirements caught by the exemption are requirements that are not truly absolute, because they … are obligation[s] that an employer take reasonable steps to do something.’ 75 Evidently, as Karijini submitted, Parliament did not agree.

[87] The Union’s submissions that the ‘reasonable steps’ referred to in the section, were not particular in the sense of being a prescribed number, date or form, but rather were steps whose number and content varied depending on the circumstances in which an agreement was made, appears correct. Certainly, the particular circumstances of the employer and employee may influence what is, or is not, a reasonable step or ‘all reasonable steps’. Afterall, s 180(5)(b) requires the employer to consider those very circumstances. But it remains the case that the Act prescribes a process which requires the employer to explain the terms of the agreement and the effect of those terms. It is evident from s 180, the employer is required to undertake a course of action or follow a particular process. The characterisation of s 180(5) as a pre-approval step, or part of the pre-approval process or course of action, does not in turn mean that the requirement is consigned a mere formality status.

[88] The Full Court of the Federal Court in One Key Workforce Pty Ltd v Construction Forestry, Mining and Energy Union 76 expressed, that to reach the requisite state of satisfaction that s 180(5) had been complied with, the Commission was required to consider the content of the explanation and the terms in which it was conveyed. It is difficult to conceive why the obligation to consider ‘explanation content’ in s 180(5), precludes it as forming part of a particular process or course of action. Some of the most important legal requirements, where examination of the ‘substantive’ is required, could be said to be procedural – for example the requirement to accord procedural fairness.

[89] Section 188(2) refers to an agreement having been genuinely agreed to within the meaning of s 188(1) but for a minor procedural error or technical error made in relation to the requirements in s 188(1)(a) or (b). Section 188(1)(a)(i) refers to ss 180(2), (3) and (5). That s 180(5) forms one of the three pre-approval ‘steps’ is acknowledged in s188(1)(a)(i). If the Union’s contention is right, s 188(2)(a) would have no work to do regarding minor procedural or technical errors made in relation to the requirements mentioned s 180(5).

[90] Previously in this decision I have cited that when interpreting statutes, no clause, sentence, or word should prove superfluous, void or insignificant. 77 If one was to adopt the contention pressed by the Union, s 188(2)(a) would be redundant so far as its operation concerns ss 188(1)(a)(i) and 180(5). That s 180(5) is a procedural requirement for the purpose of s 188(2) of the Act, sits comfortably with the language of ss 188(1) and (2), and 180(5), the statutory context, the purpose of the relevant provisions, and the apparent acceptance by the Full Bench in Huntsman that non-compliance with s 180(5) can be excused by s 188(2) in appropriate circumstances.

[91] While I have concluded that s 180(5) constitutes a procedural requirement, the question remains whether the non-compliance with the section constituted a ‘minor error’. The failure of Karijini to provide the Pay Components Comparison is in my view an error as contemplated by the Full Bench in Huntsman. Having considered the evidence of Mr Elston, General Manager – Operations Support Services, and Mr Butler, I find that neither were aware that the failure to provide the Pay Components Comparison would see them fall foul of a procedural requirement under the Act. Mr Butler gave evidence that if he had known that Karijini was required to provide such comparison he would have asked Mr Elston to provide it. 78 While Mr Elston and Mr Butler engaged in the intentional act of explaining the Agreement in the way in which they did, I am of the view that their intentional act gave rise to the unintentional result of non-compliance with a procedural requirement.

[92] It was put squarely by the Union that it could not be accepted that such a fundamental consideration, namely the Pay Components Comparison, was ‘minor’. It is evident that the word ‘minor’ qualifies the type of errors that s 188(2) can excuse. As explained, what constitutes a minor error, calls for an evaluative judgment having regard to the underlying purpose of the relevant procedural or technical requirement which has not been complied with and the relevant circumstances. 79

[93] In the First Decision, I stated that an employee’s entitlement as far as base rates of pay, penalties and allowances are concerned, are fundamental considerations for any employee. Undoubtedly, they are important considerations, and it therefore followed that I considered ‘taking all reasonable steps’ would include the provision of the Pay Components Comparison.

[94] In Huntsman the Full Bench referred to the purpose of s 180(5) as ensuring that employees understand the effect of the agreement that is to be voted on, and enabling them to make an informed decision. However, it is plain that a failure to take all ‘reasonable steps’ does not on every occasion mean that the relevant employees have been deprived from genuinely agreeing to the enterprise agreement. Despite the non-compliance with s 180(5), I arrived at the conclusion that the two train drivers had an ‘informed and genuine understanding of the Agreement and were able to give ‘informed’ consent. 80 I observed:

While the steps taken fell short of ‘all reasonable steps’, it is not the case that the consent of the employees was not informed. It was evident that at material times the employees were asked whether they had any questions and were provided with opportunities to query answers provided. While it may have been the case that there were some shortcomings with the answers provided, the evidence of Mr Butler was that the two employees asked about the ‘BOOT test’ and what it stood for. Mr Butler had explained that it was a better off overall test where the two employees’ conditions and rates of pay were measured against the Award. 81

[95] Having regard to the underlying purpose of s 180(5), the requirement which has not been complied with, and the relevant circumstances of this matter, I am satisfied that the error made by the Applicant was minor. 82

[96] In Huntsman, the Full Bench gave an example of the disadvantage that may arise from non-compliance with s 180(5). That disadvantage was that the employees might not be able to make an informed decision about the terms of the agreement upon which they were eligible to vote. The Full Bench explained that the word ‘disadvantaged’ suggested a deprivation which manifested in the employees covered by the agreement being prevented from substantively exercising their rights within the bargaining regime in Part 2-4. 83 Of course, the disadvantage that s 188(2) speaks to is one qualified by the phrase ‘were not likely to have been’, with the word ‘likely’ meaning ‘probable’.

[97] In light of my findings in the First Decision, as set out in paragraph [2] of this decision, there is no uneasiness arriving at the conclusion that the two train drivers were not likely to have been disadvantaged by Karijini’s error in relation to the requirement in s 180(5).

[98] It is therefore the case that I have concluded that the Agreement has been genuinely agree to by the two train drivers. I am satisfied that the error made was a minor procedural error in relation to one of the requirements of s 188(1)(a) of the Act and that the relevant employees covered by the Agreement were not likely to have been disadvantaged by the error.

Conclusion

[99] Karijini has provided written undertakings. A copy of the undertakings is attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement.

[100] In compliance with s 190(4) of the Act, the bargaining representative’s views regarding the undertakings proffered were sought. The bargaining representative was provided with the opportunity to raise and address any objections he or she had to the undertakings proffered by Karijini. No objection was raised.

[101] Subject to the undertakings referred to above, and on the basis of the material contained in the application and accompanying statutory declaration, I am satisfied that each of the requirements of ss 186, 187, 188, and 190 as are relevant to this application for approval have been met.

[102] The Agreement was approved on 16 September 2019 and, in accordance with s 54, will operate from 23 September 2019. The nominal expiry date of the Agreement is four (4) years from the date of this decision.



DEPUTY PRESIDENT

Appearances:

Mr Wood for the Applicant

Mr Kentish for the CFMMEU

Hearing details:

Perth

2019

26 June

Printed by authority of the Commonwealth Government Printer

<AE505317  PR712457>

Annexure A

 1   [2019] FWC 2907.

 2   MA000011.

 3   See Fair Work Act 2009 (Cth) s 181(1).

 4   Ibid s 180(1).

 5   ALDI Foods Pty Ltd v Shop, Distributive and Allied Employees Association (2017) 270 IR 459; [2017] HCA 53 [83].

 6   (2017) 262 CLR 593; 270 IR 459.

 7   (2018) 277 IR 23; [2018] FCAFC 77.

 8   (2016) 245 FCR 155.

 9   (2015) 228 FCR 297, 306-307 [34]-[41].

 10   (2018) 277 IR 23; [2018] FCAFC 77; 262 FCR 527.

 11   One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union (2018) 277 IR 23, 57; [2018] FCAFC 77 [153].

 12   Ibid [154].

 13   Fair Work Act 2009 (Cth) s 190(1).

 14   Ibid ss 190(2) and (3).

 15   Ibid s 186(2)(d).

 16   Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355.

 17   Ibid.

 18   Ibid 382.

 19   (2014) 253 CLR 531.

 20   Ibid [65].

 21   Diamond Offshore General Company v Baldwin [2018] FWCFB 6907; Construction, Forestry, Maritime, Mining and Energy Union v Dawsons Maintenance Contractors Pty Ltd [2018] FWCFB 2992; Australian Workers’ Union v Professional Traffic Solutions Pty Ltd [2018] FWCFB 633.

 22   [2018] FWCFB 6907.

 23   Ibid [28].

 24   Ibid [41].

 25   Ibid.

 26   [2018] FWCFB 2992.

 27   Ibid [24].

 28   Ibid [36].

 29   Ibid.

 30   [2018] FWCFB 6333.

 31   (1936) 55 CLR 499.

 32   Australian Workers’ Union, The v Professional Traffic Solutions Pty Ltd [2018] FWCFB 6333 [44].

 33   Ibid [45].

 34   Ibid.

 35   Ibid [46].

 36   Ibid.

 37   Ibid.

 38   Ibid [55].

 39   Ibid.

 40   [2018] FWC 6936.

 41   Ibid [31].

 42   Ibid.

 43   Ibid.

 44   Ibid.

 45   Ibid.

 46   (1998) 194 CLR 355, 382.

 47   BGC Contracting Pty Ltd T/A BGC [2018] FWC 6936 [32] – [34].

 48   Ibid [36].

 49   [2019] FWCFB 4022 [92].

 50   Ibid [72].

 51   Ibid.

 52   BGC Contracting Pty Ltd T/A BGC [2018] FWC 6936 [32].

 53   Ibid [36].

 54   [2003] AIRC 1195; (2003) 127 IR 205 [48].

 55   [2018] FWCA 2888 [59].

 56   Ibid.

 57   [2019] FWCFB 318.

 58   [2017] FCA 1266.

 59   [2018] FCAFC 77.

 60   Huntsman Chemical Company Australia Pty Limited T/A RMAX Rigid Cellular Plastics & Others [2019] FWCFB 318 [43].

 61   Ibid [37].

 62   Ibid [45].

 63   Ibid [45] and [54].

 64   Ibid [45] and [55].

 65   Ibid

 66   Ibid [74].

 67   Ibid [45] and [79].

 68   Ibid [45] and [70].

 69   Ibid [45] and [72].

 70   Ibid [45] and [73].

 71   Ibid [45] and [104].

 72   Ibid [45] and [105].

 73   Ibid [45] and [110].

 74   Ibid [45] and [113].

 75   ACTU, Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Bill 2017: Submission to the Senate Education and Employment Legislation Committee (7 April 2017) 7.

 76   [2018] FCAFC 77.

 77   (1998) 194 CLR 355.

 78   Second Witness Statement of Graham Butler [2(a)].

 79   Huntsman Chemical Company Australia Pty Limited T/A RMAX Rigid Cellular Plastics & Others [2019] FWCFB 318 [45] and [55].

 80   [2019] FWC 2907 [157] and [159]-[160].

 81   Transcript PN [266].

 82   Huntsman Chemical Company Australia Pty Limited T/A RMAX Rigid Cellular Plastics & Others [2019] FWCFB 318 [45] and [55].

 83   Ibid [45] and [104].