Ministerial declaration

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Introduction

See Fair Work Act 2009 s.247

Two or more employers that will be covered by a proposed enterprise agreement may apply to the Minister for a declaration that they may bargain together.

The Minister may only make a declaration upon application by the relevant employers and the declaration must be in writing.

Applying for a Ministerial declaration

The application must specify the employers that will be covered by the agreement. The specified employers are the relevant employers in the application.

Categories of employers that may be considered for a Ministerial declaration include:

public hospitals that are technically distinct employers, but have a high degree of coordination and common employment arrangements
schools which share common employment arrangements and a common funding source and arrangements, and
school councils or parents and friends associations that are technically separate employers but who may employ additional staff to work within a single public school system.^[1]

The Minister must take into account the following matters when deciding whether or not to make a declaration:

the history of bargaining of each of the relevant employers
the interests that the relevant employers have in common and the extent to which those interests are relevant to whether they should be permitted to bargain together
whether the relevant employers are governed by a common regulatory regime
whether it would be more appropriate for each of the relevant employers to make a separate enterprise agreement with its employees
the extent to which the relevant employers operate collaboratively rather than competitively
whether the relevant employers are substantially funded, directly or indirectly, by the Commonwealth or a state or territory, and
any other matter the Minister considers relevant.

In addition to obtaining a Ministerial declaration, the employers must apply to the Fair Work Commission for a single interest employer authorisation.

Upon application, the Commission must make a single interest employer authorisation if:

the Minister has issued a declaration, and^[2]
the Commission is satisfied that the employers that will be covered by the agreement have agreed to bargain together and that no person coerced, or threatened to coerce, any of the employers to agree to bargain together.^[3]

Case examples

Single interest employers

Franchisees engaged in a common enterprise

Buxridge Pty Ltd [2012] FWA 5132 (Gay C, 15 June 2012).

Buxridge Pty Ltd made an application for a single interest employer authorisation in respect of itself and 6 franchisees that conducted business in the bakery industry. The Commission was satisfied that the employers that were the subject of the application carried on similar business activities under the same franchise and were franchisees of the same franchisor.

The Commission made the single interest employer authorisation.

Ministerial declaration

Re Victorian Hospitals' Industrial Association [2011] FWA 8376 (Jones C, 6 December 2011), [(2011) 216 IR 11].

The Victorian Hospital Industrial Association (VHIA) applied to the Commission for a single employer authorisation. The employers that were seeking to bargain together included several metropolitan and regional hospitals or health services centres. VHIA made its application as the nominated representative of these employers. The VHIA had applied to the Minister for Tertiary Education, Skills, Jobs and Workplace Relations for a declaration that they may bargain together for an enterprise agreement. The Minister had granted this declaration.

Upon confirming that all other requirements under the Fair Work Act were satisfied, the Commission granted the single interest employer authorisation.

Agreement a single-enterprise agreement

Franchisees engaged in a common enterprise

Shop, Distributive and Allied Employees Association v McDonald's Restaurants PR915681 (AIRC, Lawson C, 22 March 2002).

In considering whether the employers, who operated franchise McDonald's restaurants, named in the application constituted a common enterprise the Commission was referred to an authority of the High Court relied upon in similar applications [Australian Softwood Forests].

The Commission found that the 9 employers named in the application carried on businesses which were identical in character, are operated in an identical manner and which provide identical products which are priced identically. In all respects the operations of the businesses were carried out in a manner which is seamless to the consumer. In each case the businesses were mutually interdependent with McDonald's Australia Ltd.

Agreement NOT a single-enterprise agreement

Franchisees not engaged in a common enterprise

Re Bakers Delight Holdings Ltd PR923670 AIRC, Ives DP, 15 October 2002), [(2002) 119 IR 20].

Application for a proposed agreement by 9 companies (the Franchisees) which own and operate Bakers Delight bakeries in the Australian Capital Territory. The Franchisees were not related bodies corporate within the meaning of the Corporations Act 2001 (Cth), either with each other or with Bakers Delight and each Franchisee had entered into a franchise arrangement with Bakers Delight, each with substantially similar contractual obligations. Even where significant controls were placed upon employers, either by a franchise agreement or by statute, the Commission had been cautious in treating multiple employers as a common enterprise.

The Commission was not satisfied that the 9 Franchisees were engaged in a common enterprise. Notwithstanding the substantial degree of uniformity of their operations, each Franchisee was not closely connected with the operations of each other Franchisee "on the footing that one part is to be carried out by [Franchisee] A and the other by [Franchisee] B."

Although each Franchisee had a contractual relationship with Bakers Delight, there does not appear to be a declared collective intent between the Franchisees. While operations were close to identical between Franchisees, there was no evidence that the Franchisees share operations or resources. Subject to the restraints imposed by the franchise agreements between Bakers Delight and each Franchisee, the Franchisees operated independently of one another.

References

^[1] Explanatory Memorandum to Fair Work Bill 2008 at para. 1041.

^[2] Fair Work Act s.249(3).

^[3] Fair Work Act s.249(1).

Updated time

Last updated

24 May 2019

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