DECISION

Fair Work Act 2009
s.604—Appeal of decision

Australian Rail, Tram and Bus Industry Union
v
Busways Northern Beaches Pty Ltd, Busways Eastern Suburbs Pty Ltd and Busways North West Pty Ltd t/a Busways & the Transport Workers’ Union of Australia
(C2020/7296)

Appeal against decision [2020] FWCA 4823 of Commissioner Harper-Greenwell on 9 September 2020 in matter number AG2020/2480.

[1] By its notice of appeal lodged on 28 September 2020, the Australian Rail, Tram and Bus Industry Union (RTBU) seeks permission to appeal and, if granted, appeals against a decision of Commissioner Harper-Greenwell¹ approving the Busways, Transport Workers’ Union of Australia and Drivers Enterprise Agreement 2020 (Agreement) with undertakings. The Agreement was made between Busways Northern Beaches Pty Ltd, Busways Eastern Suburbs Pty Ltd and Busways North West Pty Ltd, which are related bodies corporate (collectively Busways), and the Transport Workers’ Union of Australia (TWU) and was approved as a greenfields agreement within the meaning of s 172(2)(b) and (4) of the Fair Work Act 2009 (FW Act).

[2] The application to approve the Agreement was not contested. The application was determined without a hearing and the TWU supported the Agreement’s approval. The RTBU did not seek to be heard, presumably because it was unaware of the application. The decision approving the Agreement records that the Agreement meets the requirements of s 172(2)(b) of the FW Act. 2 It also records the Commissioner’s satisfaction that the relevant approval requirements in ss 186 and 187 of the FW Act have been met, that the TWU is entitled to represent the industrial interests of a majority of employees who will be covered by the Agreement in relation to work that is to be performed under it and that it is in the public interest to approve the Agreement.3

[3] Pursuant to clause 4(a), the Agreement will apply to persons employed by Busways Northern Beaches Pty Ltd, Busways Eastern Suburbs Pty Ltd and Busways North West Pty Ltd as bus drivers in the provision of services under a Sydney Metropolitan Bus Service Contract or an Outer Sydney Metropolitan Bus Service Contract.

[4] Before turning to some background matters, we deal briefly with two issues. The first concerns the admission into evidence of two statements of Mr David Babineau, the Divisional Secretary of the Tram and Bus Division of the NSW Branch of the RTBU, and the tender bundle of documents filed by Busways in response. We determined to admit the statements of Mr Babineau in circumstances where the RTBU did not participate in the approval proceedings. It was appropriate to also admit Busways’ tender bundle documents, in relation to which there is a confidentiality order in operation.⁴ The evidence was admitted on the basis discussed during the appeal hearing.⁵

[5] The second matter concerns the standing of the RTBU to bring this appeal. The TWU contended that there was an insufficient basis for concluding the RTBU is a person aggrieved for the purpose of seeking permission to appeal under s 604(1). This is because the RTBU is said not to have a general capacity under its rules to represent bus drivers outside of government operations, unless run in conjunction with and controlled by the same employer as a tramways service. The TWU contended that employees who transfer from government employment will be subject to a copied State award created under Part 6-3A of the FW Act and the Agreement will not apply to these employees. It says that the capacity of the RTBU to cover any new employees to whom the Agreement will apply under Rule 4(4)(ii) of the Rules of the RTBU is unknown and would depend, at best, on the corporate structure utilised by Busways.

[6] The RTBU contends that when persons are employed by Busways as bus drivers, it will have the right under its rules to represent those employees employed under the terms of the Agreement. It is not necessary for us to determine whether coverage by the RTBU under its rules will exist when persons are employed. It is sufficient to note the NSW Government-employed drivers in the regions in which Busways, if successful in its tenders, will operate bus services will become employed by Busways, initially on the terms described in the background discussion below. Many of these drivers are members of the RTBU. The RTBU currently has an unambiguous right to represent the industrial interests of these employees under its rules. These drivers plainly have an interest in the industrial terms and conditions that will apply to drivers to be employed by Busways and with whom they will work, whether or not those terms and conditions will immediately apply to them. This is a sufficient basis in our view to render their representative, the RTBU, a person aggrieved and thus to have standing to bring the appeal.

Background

[7] The relevant factual and regulatory background may be summarised as follows:

•  Transport for NSW currently contracts with various entities, on behalf of the State of NSW, for the provision of passenger bus services (passenger service contract) in several regions in the Sydney area. Section 36 of the Passenger Transport Act 2014 (NSW) (PT Act) requires passenger bus services to be provided under a passenger service contract.

•  Section 39 of the PT Act prohibits a person operating a public passenger service that is conducted according to regular routes and timetables or according to regular routes and at regular intervals otherwise than under the authority of a passenger service contract.

•  Transport for NSW is a corporation constituted by s 3C(1) the Transport Administration Act 1988 (NSW) (TA Act). It is a NSW Government agency with its affairs managed and controlled by the Secretary of the Department of Transport.⁶

•  Pursuant to the TA Act, Transport for NSW is given functions set out in Schedule 1 thereto, including contracting, on behalf of the State, with public transport agencies or the private sector, for the delivery of transport services, including the setting of performance targets and service standards.⁷

•  Transport for NSW may, for the purpose of exercising its functions, give directions to specified bodies, including the State Transit Authority of New South Wales (STA) in relation to the exercise of their functions.⁸

•  The STA is currently the contracting party in Regions 7, 8 and 9, providing bus services covering areas around Ryde, Gladesville, the Northern Beaches, the Lower North Shore, the CBD and the Eastern Suburbs of Sydney.

•  The STA is constituted as a corporation by s 20 of the TA Act and has various functions, including the operation of bus services.⁹

•  Neither of Transport for NSW nor STA employ any staff and are prohibited from doing so.¹⁰

•  The Government of NSW may employ staff through the Transport Service of NSW to enable several entities, including the STA and Transport for NSW, to exercise their functions.¹¹

•  The principal objectives of the STA include the operation of “efficient, safe and reliable bus services”.¹² The STA’s functions include operating bus services; continuing to operate the bus services which were provided by the Urban Transit Authority; and it may establish any new bus service, or may alter or discontinue any of its bus services.¹³

•  Pursuant to Part 8 of the TA Act, provision is made for the finances of the STA (Division 2 of Part 8) and Transport for NSW (Division 3 of Part 8). There is established respectively, the State Transit Authority Fund and the Transport for NSW Fund. 14 Payments are made into each fund from various sources including appropriations by Parliament or advances by the Treasurer.15 Payments may be made from each fund for purposes including payments made on account of, respectively, the STA or Transport for NSW, or as required to meet expenditure incurred in relation to the functions of, respectively, the STA or Transport for NSW.16

•  On 23 October 2019, Transport for NSW announced that the NSW Government would invite public transport operators to tender for contracts for 13 of Sydney’s bus contract regions, including the regions operated by the STA. The text of the announcement is set out in full below:

“Bus customers will receive additional services and innovative on demand options under new contracts to lift the standard of transport across Sydney.

Minister for Transport Andrew Constance said the reform was designed to ensure the best outcomes for both customers and staff.

‘Our bus drivers are the best in the world. They do an amazing job in getting people around this incredible city and play a vital role in helping to tackle Sydney’s congestion,’ Mr Constance said.

‘Bus patronage has increased by more than 50 per cent over the past six years. This rate of growth outstrips that of all other forms of public transport and we need to address this increasing demand as a matter of urgency.’

The NSW Government will invite the world’s leading public transport operators, Australian and international, to bid for contracts for 13 of Sydney’s bus contract regions over the next three years. This will include the three remaining State Transit operated regions.

Mr Constance said a competitive tender of all Sydney metropolitan bus contracts will enable the NSW Government to reinvest more into delivering better services to commuters.

‘We know customers want more buses, more often, as well as a mix of bus services that cater to their needs. This includes high-frequency services on major routes, like the B-Line, and frequent direct options such as on-demand services for short, local trips.’

‘The NSW Government will engage with the private sector to transform the current, one-size-fits-all model of service delivery, to one with multiple service types including high-capacity routes and local and on-demand travel.’

Contracts for the three remaining State Transit Regions 7, 8, and 9 – covering Ryde, Gladesville, the Northern Beaches, Lower North Shore, the CBD, and the Eastern Suburbs will be included and be put out to tender by early 2020.

The NSW Government will continue to:

own State Transit buses and all other assets such as depots,

regulate timetables, safety, and service priorities, and

set fares as they are today, under the Opal system.

The reform will also see Sydney’s ageing diesel bus fleet replaced by electric vehicles to reduce the impact of buses on the health and environment of our city.

‘Making the switch to an entirely electric bus fleet will deliver huge benefits to the community in terms of reducing air and noise pollution, as well as our incredible drivers,’ Mr Constance said.

‘As part of this process, we will challenge the industry to begin an ambitious transformation of our bus fleet from particulate emitting diesel to zero-emission buses.

‘The experience of other leading European cities demonstrates that a rapid transition to zero-emission buses is possible and I have asked Transport for NSW to work with operators and bus suppliers to develop a plan to transition our fleet as part of the tender process.

‘Zero-emission buses are becoming the standard with the significant environmental, health and operational cost benefits being experienced now in cities like London, Paris and Amsterdam. As a truly global city Sydney deserves the same.’

Mr Constance said there would be jobs for the majority of State Transit award staff with the new operator(s), including all bus drivers and maintenance staff, whose jobs will be guaranteed for two years. These staff will also transfer with all their accrued entitlements such as annual leave, sick leave, long service leave, superannuation and their three-year travel pass.

‘Today’s announcement is not a reflection on the performance of State Transit bus drivers who have been doing an excellent job dealing with the strong surge in passenger numbers and demanding road conditions,’ Mr Constance said.

‘We expect more jobs for bus drivers to be created due to the extra services that will be provided.

‘We have started engaging with all staff and their union representatives about today’s announcement, and will continue this right through the tender and transition process.’”¹⁷

•  In May 2020, Transport for NSW wrote to the Secretary of Unions NSW setting out the proposed timing for the Request for Tender processes for each of Regions 7, 8 and 9 and indicated that all operational staff covered by awards in these regions were to be guaranteed employment with the new operator(s) with a two year employment guarantee under the same conditions and that leave, recognition of service and continuity of service would be protected.¹⁸

•  The proposed timing for the staggered Requests for Tender was as follows:¹⁹

Region	RFT announced	Transition commences and concludes
Region 8 (North)	June 2020	May 2021 to October 2021
Region 7 (West)	August 2020	August 2021 to December 2021
Region 9 (East)	November 2020	November 2021 to April 2022

•  Some of the timing was subsequently altered so that for Region 8 tender closed on 31 September 2020; the successful tenderer will be announced in March 2021 with service to Commence in October 2021.²⁰

•  On 24 June 2020, the NSW Government released the Request for Tender documents in relation to Region 8. The Request for Tender documents provide, inter alia, that:

“xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

…

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

…

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  Busways Northern Beaches Pty Ltd has submitted a tender for Bus Contract 8 to operate a bus service in Region 8. Busways North West Pty Ltd is preparing to tender for Bus Contract 7 to operate a bus service in Region 7 and Busways Eastern Suburbs Pty Ltd intends to tender for Bus Contract 9 to operate a bus service in Region 9.

•  If Busways is the successful tenderer, relevant State award staff currently employed through Transport Service of NSW and working in Regions 7, 8 and 9 will become employed by the relevant Busways entity subject to certain employment guarantees. The Agreement will not immediately apply to these staff. It is accepted by Busways that the relevant state award staff employed by the relevant entities will be covered by a copied State instrument.²¹

•  The Agreement was made on 20 August 2020²² and approved by the Commissioner on 9 September 2020.²³ It commenced to operate on 16 September 2020.²⁴

Grounds of appeal

[8] The RBTU’s notice of appeal contains four appeal grounds. The first contends the Commissioner erred in finding that the Agreement related to a genuine new enterprise that Busways is establishing or proposes to establish. The second contends the Commissioner erred in failing to find that the Agreement related to an existing enterprise, namely the State Transit enterprise that currently provides Sydney Metropolitan Bus Services and Outer Sydney Metropolitan bus services, and not to a genuine new enterprise that the Busway is establishing or proposes to establish. The third contends the Commissioner erred in that she exceeded her jurisdiction by approving the Agreement which was not capable of being approved as an enterprise agreement under the FW Act. The final ground contends error in that inadequate reasons for the conclusion that the Agreement met the requirements of ss 172(2)(b), 186 and 187 of the FW Act were given.

[9] We will deal with these grounds shortly below.

Permission to appeal

[10] The RTBU’s appeal raises important questions about whether the Agreement relates to a genuine new enterprise Busways propose to establish in the factual circumstances described above. We therefore consider that it is in the public interest that permission to appeal be granted and we do so.

Consideration

Grounds 1-3

[11] We propose to deal with the first three grounds together because the complaint raised by each ground is in essence the same, namely that the Agreement approved was not a greenfields agreement within the meaning of s 172(2)(b) and (4) of the FW Act and there was no other statutory basis on which the Agreement could have been approved.

[12] The central proposition advanced by the RTBU in support of these appeal grounds is that the Agreement relates to an existing enterprise (passenger bus services in Regions 7, 8 and 9 of Sydney) that Busways propose to acquire, as a going concern. It contends that the business, project, activity or undertaking of running passenger bus services in Regions 7, 8 and 9 is not new. The STA has been doing it for many years. It contends that this activity is the activity that the NSW Government is now tendering away for someone else to do. It says that if the tender is awarded to Busways, it will conduct that business or undertake that activity or project or conduct the undertaking in any or all of Regions 7, 8 and 9 and the STA will not.

[13] The RTBU contends that the following facts run counter to any suggestion that there is anything new in the business, project, activity or undertaking to be conducted by Busways once the tender is awarded:

•  employees of Transport Service of NSW who are bus drivers in Regions 7, 8 and 9 will, if Busways is the successful tenderer, become employed by one of the Busways entities; and

•  the activities, operating a passenger bus service, are in the same geographical area as where their former employer conducted the same activities.

[14] The RTBU says that Busways will be undertaking the very same old activities that the STA was (and is currently) conducting in Regions 7, 8 and 9. The RTBU contends that it is also relevant that related entities to the three Busways entities tendering to take over the activities of the STA in Regions 7, 8 and 9 have an established enterprise which conducts the same business or activity, a passenger bus transport service, in Sydney and elsewhere.

[15] For the reasons which follow, we reject the RTBU’s contentions.

[16] Section 172(2)(b) of the FW Act permits making a greenfields agreement with one or more employee organisations. An agreement will be a greenfields agreement if, relevantly, it “relates to a genuine new enterprise that the employer or employers are establishing or propose to establish”.²⁵ There is no dispute raised in the appeal that Busways did not employ any of the persons who will be necessary for the normal conduct of the enterprise and who will be covered by the Agreement, when it made the Agreement with the TWU.²⁶
[17] The word “enterprise” means “a business, activity, project or undertaking”.²⁷ The issue of whether an agreement relates to a genuine new enterprise is a question of jurisdictional fact upon which the jurisdiction of the Commission to approve a greenfields agreement depends.²⁸

[18] Assessing whether an agreement relates to a genuine new enterprise that the employer(s) are establishing or propose to establish requires consideration of the objective character and identity of the enterprise to which the agreement is said to relate based on an overall consideration of all of the circumstances.²⁹ There is no single consideration which is decisive and, in many cases, the assessment will be a matter of fact and degree.³⁰ Each expression in the definition of “enterprise”, “business, activity, project or undertaking”, has a distinct (although potentially overlapping) meaning and operation so that there will be a genuine new enterprise if the agreement relates to a new business, new activity, new project or new undertaking.³¹

[19] If an employer acquires an existing business as a going concern, this might suggest that the business acquired is not a genuine new enterprise.³² However, the novelty of an enterprise to the employer’s business will be a relevant consideration in the overall assessment.³³ An enterprise agreement may relate to a genuine new enterprise even if the nature of the enterprise is the same or similar to the employer’s existing enterprise. This is particularly in the case of a new project the employer is undertaking or proposes to undertake. For example, an employer in the construction industry could make a greenfields agreement in relation to a genuine new construction project even though its existing business involves construction.³⁴

[20] The RTBU’s contention that the Agreement does not relate to a genuine new business that Busways propose to establish cannot be accepted merely on the basis that the STA currently operates passenger bus services in Regions 7, 8 and 9, has done so for some years and consequently Busways is proposing to acquire or conduct that business. This is because the contention does not consider the whole of the circumstances.

[21] The business of providing passenger bus services in Regions 7, 8 and 9 of Sydney which the Busways entities propose to establish is new to each entity which made the Agreement with the TWU. None of these entities currently operate a bus service at all but each proposes to do so in the future if their respective tenders are successful. Unlike the STA, which is not an employer and does not operate bus services in Regions 7, 8 and 9 for profit, Busways proposes to do both.

[22] The requests for tender and contracts to be offered by Transport for NSW provide for the successful tenderer to establish a profit-making business and specifically for various means of improving or enhancing the profitability of the bus services. The privately owned and operated bus services that are to be established by the successful tenderer in each region, will be bus services operating for profit and no such business is currently established.

[23] Assuming the successful tenderer is Busways, it does not appear to us that any of the entities would take over any business from the STA as a going concern. The privatisation of the provision of bus services in Regions 7, 8 and 9 involves the termination of the contract between Transport for NSW and the STA and entry into a new contract with a private operator. The buses and other assets will remain owned by the NSW Government and employees who may transfer to one of the Busways entities are currently employees of the NSW Government. They are not employed by either of Transport for NSW or the STA.

[24] In our view, and as should be apparent from the regulatory scheme earlier described, the STA does not have a "going concern" business which can be assigned by it to anyone and Busways will not acquire any enterprise from the STA. The STA does not have any authority to dispose of, assign or transfer to anyone any enterprise constituted by bus services which it currently operates in Regions 7, 8 and 9.

[25] The stated intention of the NSW Government in establishing the tender process is to create different and innovative bus services in the future. As noted earlier, engaging with the private sector to provide bus services in Regions 7, 8 and 9 is intended to change the current, one-size-fits-all model of service delivery, to one with multiple service types including high-capacity routes and local and on-demand travel.³⁵

[26] As Busways has pointed out, the tender documentation also speaks to the business that is proposed to be established and sets out the different and more expansive nature of the bus services required to be provided by a private sector contracting party, including the following:

• 

◦xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

◦xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

◦xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

◦xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

•  xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

[27] Furthermore, the tender documentation requires the operator tendering for a bus contract to be a special purpose vehicle, which must be a proprietary company incorporated under the Corporations Act 2001 (Cth), used solely for the purposes of performing the services or other activities permitted under the contract.³⁶ Each Busways entity is so incorporated for the purposes of performing the services the subject of the tender for the relevant bus region to which the tender relates. It therefore cannot be accepted, as the RTBU suggests, that there is some contrivance about the Agreement or the establishment of special purpose vehicle entities to provide bus services.

[28] The factual and regulatory framework pertaining to the current and proposed operation of bus service in Regions 7, 8 or 9 earlier described suggests to us that the business, activity or undertaking of providing bus services in these regions will be a novel or new enterprise for Busways. True it is that some other entities related to the three Busways entities operate some bus services in other parts of NSW, but this does not detract from that conclusion. Each Busways entity is a distinct corporate entity established, as we have already noted, for the purposes of tendering for and undertaking the distinct operations in Regions 7, 8 and 9. This mechanism is not of Busways’ making but rather is a requirement of the tender documentation with which the Busways entities and other tenderers must comply if they hope to become the successful tenderer. If Busways is successful, this will represent a new business for the three Busways entities.

[29] Also evident from the factual and regulatory framework, the tenders for and privatisation of Regions 7, 8 and 9 bus services the NSW Government is undertaking involves a decision that the Government through its statutory corporations will cease to provide bus services and that bus services will be provided by the private sector.

[30] Section 172(2)(b)(i) of the FW Act directs attention, relevantly, to whether the Agreement relates to a genuine new enterprise that Busways entities propose to establish. This necessarily involves assessing what it is that Busways propose be established. That which is here proposed is a new, private sector operation for profit which will have different and additional services operated autonomously from direct NSW Government control. We agree with the TWU’s contention that the statutory, regulatory and organisational context of the provision of bus services will, as a result, be different in the hands of the successful tenderer and so that which is proposed by Busways is not merely the continuation of the same business or operation. If successful Busways will not be acquiring the relevant enterprise as a going concern.

[31] The Agreement was made in circumstances where it must, at the time of its making, relevantly relate to a genuine new enterprise the Busways entities “propose to establish”. In short compass the enterprise Busways propose to establish is a privately operated, for profit bus service serving Regions 7, 8 and 9 of Sydney. Although the issue whether Busways “propose to establish” an enterprise in the circumstances described earlier did not receive any real attention by the parties during the appeal, we wish to say something about that issue. If employers make an agreement with a registered organisation at a time when the employers:

•  have submitted a response to a request for tender but do not know whether they will be awarded the tender; or

•  merely contemplate doing so in respect of an anticipated request for tender,

can the employers properly be said to have made an agreement that relates to a genuine new enterprise that the employers “propose to establish”?

[32] When the Busways entities made the Agreement only the Region 8 request for tender had been released. Busways Northern Beaches Pty Ltd had submitted a response to that tender. Busways North West Pty Ltd was preparing to tender for Bus Contract 7 to operate a bus service in Region 7 and Busways Eastern Suburbs Pty Ltd intended to tender for Bus Contract 9 to operate a bus service in Region 9. Responses to requests for tender had not been made for Regions 7 or 9 as the requests had not been released. A submitted response to a request for tender to conduct a private sector bus service, depending on the circumstances, may comfortably be said to involve proposing to establish an enterprise. But there may be some doubt about whether an enterprise agreement made with a registered organisation when an employer(s) is (are) preparing to tender, or merely “intending” to tender, can be said to relate to a genuine new enterprise the employers “propose to establish”.

[33] The notion that employers which make an enterprise agreement with a registered organisation “propose to establish” a genuine new enterprise in relation to which the agreement relates connotes putting forward a plan or suggestion for establishing that enterprise. An intention to tender for a contract without more may be nothing more than employers desiring to establish, wanting to establish or expressing interest in establishing an enterprise but falling short of actually proposing to do so. Questions might also arise about whether approving a greenfields agreement in such circumstances is in the public interest. 37 However, as this matter was not argued, we take it no further.

[34] For the reasons we have given earlier, the enterprise Busways propose to establish is in our view a genuine new enterprise and the Agreement it made with the TWU relates to that enterprise. It follows that the Commissioner had power to approve the Agreement as a greenfields agreement and was correct in doing so. Grounds 1-3 of the notice of appeal are therefore not made out.

Ground 4

[35] The RTBU complains under this appeal ground that the Commissioner failed to set out any factual foundation for her conclusion or to grapple with the issue associated with the nature of the proposed genuine new business Busways propose to establish. It says there was no analysis of what the new enterprise is, what it involved, how it was conceived (and by whom), where it had come from and when it was to commence or anything similar. It says there was thus a failure to give reasons.

[36] We consider that there is no utility in determining this ground of appeal. The real issue agitated in this appeal is whether the Commissioner was correct that the Agreement related to a genuine new enterprise that Busways propose to establish. We have determined the Commissioner was correct. Accordingly, a complaint about the failure to give reasons or of the adequacy of the reasons is of no moment.

Order

[37] We order as follows:

(1) Permission to appeal is granted.

(2) The appeal is dismissed.

VICE PRESIDENT

Appearances:

R Reitano of counsel on behalf of the Appellant

HJ Dixon SC and D Lloyd of Counsel on behalf of the first to third named Respondents

M Gibian SC on behalf of the fourth named Respondent

Hearing details:

2020

Sydney (via video-link)

14 December

Printed by authority of the Commonwealth Government Printer

<PR726714>

1 [2020] FWCA 4823

 2   Ibid at [2]

 3   Ibid

4 PR724816

5 Transcript, 14 December 2020, PNs 10-16

6 Transport Administration Act 1988 (NSW), ss 3C(2) and (3)

7 Ibid, Schedule 1, cl 1(e)

8 Ibid, s 3G

9 Ibid, ss 21-24

10 Constitution Act 1902 (NSW), s 47A

11 Transport Administration Act 1988 (NSW), ss 68B-68C

12 Ibid, s 20A

13 Ibid, s 21

 14   Ibid, ss 73, 77

 15   Ibid, ss 74, 78

 16   Ibid, ss 75, 79

17 Exhibit 1, Witness Statement of David Babineau dated 28 October 2020, Annexure DB-5

18 Ibid, Annexure DB-8

19 Ibid

20 Ibid at [23]

21 Transcript, 14 December 2020, PNs 243-244

22 Appeal Book, pp 52, 63

23 [2020] FWCA 4823

24 Ibid at [6]

25 Fair Work Act 2009, ss 172(2)(b) and (4)

26 Ibid, ss 172(2)(b)(ii)

27 Ibid, s 12

28 National Union of Workers (NSW) v HP Distribution Pty Ltd [2013] FCA 139, 210 FCR 250, 231 IR 263 at [29], [41]; Construction, Forestry, Maritime, Mining and Energy Union v CPB Contractors Pty Ltd and the Australian Workers’ Union [2018] FWCFB 3702, 280 IR 293 at [7]

29 Re Patrick Cargo Pty Ltd Certified Agreement 2002 [2002] AIRC 859, 115 IR 443 at [23]; National Union of Workers (NSW) v HP Distribution Pty Ltd [2013] FCA 139, 210 FCR 250, 231 IR 263 at [34]; Construction, Forestry, Maritime, Mining and Energy Union v CPB Contractors Pty Ltd and the Australian Workers’ Union [2018] FWCFB 3702, 280 IR 293 at [45]

30 Construction, Forestry, Maritime, Mining and Energy Union v CPB Contractors Pty Ltd and the Australian Workers’ Union [2018] FWCFB 3702, 280 IR 293 at [45]

31 Ibid at [47]-[53]

32 Re Patrick Cargo Pty Ltd Certified Agreement 2002 [2002] AIRC 859, 115 IR 443 at [24]; Explanatory Memorandum to the Fair Work Bill 2009 at [692]

33 Re Patrick Cargo Pty Ltd Certified Agreement 2002 [2002] AIRC 859, 115 IR 443 at [23]; National Union of Workers (NSW) v HP Distribution Pty Ltd [2013] FCA 139, 210 FCR 250, 231 IR 263 at [34]; Construction, Forestry, Maritime, Mining and Energy Union v CPB Contractors Pty Ltd and the Australian Workers’ Union [2018] FWCFB 3702, 280 IR 293 at [45]

34 Explanatory Memorandum to the Fair Work Bill 2009 at [693]

35 Exhibit 1, Witness Statement of David Babineau dated 28 October 2020, Annexure DB-5

36 Exhibit 3, Busways’ Tender Bundle, Region 8 and Region 7, RFT Vol 1, [3.8] and Vol 3, cl 38.2

 37   Fair Work Act 2009, s 187(5)(b)