See Fair Work Act 2009 ss.186(3)–(3A)
The group of employees to be covered by a proposed agreement is chosen when the employer and the employee bargaining representatives agree on a particular scope or the bargaining representatives commence bargaining on a shared assumption as to scope.[1]
The group of employees to be covered by a proposed agreement (ie the scope of the agreement) will typically be chosen at or shortly after the commencement of bargaining. If there is disagreement between bargaining representatives on the scope of the agreement, then the scope itself will become a matter for bargaining.[2]
Before approving an agreement, the Fair Work Commission must be satisfied that the group of employees the agreement covers was fairly chosen.[3]
Whilst the Commission's decision as to whether or not the group of employees covered by the agreement was fairly chosen involves a degree of subjectivity or value judgement,[4] in circumstances where an agreement does not cover all of the employees of the employer(s) covered by the agreement, the Commission must consider whether the group of employees covered by the agreement is:
Geographical distinctness is concerned with the geographical separateness of the employer's various worksites or work locations, rather than a separation of workplaces within the same worksite.[5]
Generally, the selection of the group of employees to be covered by an agreement on some objective basis (as opposed to an arbitrary or subjective basis) is likely to point to a conclusion that the group was fairly chosen.[6]
However, depending on the circumstances of the particular case, there may be more than one way of fairly choosing the group of employees to be covered by a proposed enterprise agreement.[7] Different scope provisions may be equally described as fair in the sense that no obvious unfairness arises from their application.
The role of the Commission is not to determine the scope of the agreement, but rather to guard against unfairness by being satisfied that the group can be described, in all the circumstances as fairly chosen.[8]
When determining whether a group of employees has been fairly chosen, the Commission may have regard to matters such as:
If a group of employees covered by the agreement are geographically, operationally or organisationally distinct, this would point in favour of a finding that the group of employees was fairly chosen. However, whether or not the group of employees covered by the agreement is geographically, operationally or organisationally distinct is not decisive, rather it is a matter to be given due weight, having regard to all other relevant considerations.[9]
An illustrative example is provided in the Explanatory Memorandum:[10]
A single employer operates five organisationally distinct units within its enterprise. The employer makes an agreement with all of the employees in two organisationally distinct units, as well as ten employees who are the only non-union members within … another organisational unit that has a total of 30 employees. The Commission is required to decide whether the group of employees covered by the agreement is fairly chosen.
In this example, the group of employees covered by the agreement is likely to be unfair, particularly as the employees were unfairly chosen.
If an employee is covered by an individual agreement made under previous laws, such as an Australian Workplace Agreement (AWA) or an Individual Transitional Employment Agreement (ITEA), then that individual agreement will continue to apply to them.[11] While such an individual agreement applies to an employee, or the employer in relation to the employee, an enterprise agreement does not apply to them.[12]
For an enterprise agreement to apply to the employee, it will be necessary for the individual agreement to be terminated or conditionally terminated.
Certain employees may be covered by an individual agreement made under previous legislative schemes, such as an Australian Workplace Agreement (AWA) or an Individual Transitional Employment Agreement (ITEA).
As all individual agreements made under the Workplace Relations Act 1996 (Cth) (and preserved individual State agreements) have passed their nominal expiry date, an employee who is covered by an individual agreement will be eligible to be represented in bargaining for the proposed enterprise agreement (and to vote on the proposed enterprise agreement).
However, for an enterprise agreement to apply to the employee, it will be necessary for the individual agreement to be terminated or conditionally terminated.
[1] Re ANZ Stadium Casual Employees Enterprise Agreement 2009 [2010] FWAA 3758 (Lawler VP, 26 May 2010) at para. 28.
[2] Ibid., at para. 29.
[3] Aerocare Flight Support Pty Ltd t/a Aerocare Flight Support v Transport Workers' Union of Australia; Australian Municipal, Administrative, Clerical and Services Union [2017] FWCFB 5826 (Hatcher VP, Binet DP, Cambridge C, 27 November 2017).
[4] Cimeco Pty Ltd v Construction, Forestry, Mining and Energy Union [2012] FWAFB 2206 (Ross J, Hamilton DP, Spencer C, 12 April 2012) at para. 8.
[5] The Australian Workers' Union v BP Refinery (Kwinana) Pty Ltd [2014] FWCFB 1476 (Catanzariti VP, Lawler VP, Lewin C, 3 April 2014) at para. 13.
[6] Cimeco Pty Ltd v Construction, Forestry, Mining and Energy Union [2012] FWAFB 2206 (Ross J, Hamilton DP, Spencer C, 12 April 2012) at para. 16.
[7] The Australian Workers' Union v BP Refinery (Kwinana) Pty Ltd [2014] FWCFB 1476 (Catanzariti VP, Lawler VP, Lewin C, 3 April 2014) at para. 14.
[8] Construction, Forestry, Mining and Energy Union v ResCo Training and Labour Pty Ltd [2012] FWAFB 8461 (Watson VP, Hamilton DP, Simpson C, 17 October 2012) at para. 35.
[9] Cimeco Pty Ltd v Construction, Forestry, Mining and Energy Union [2012] FWAFB 2206 (Ross J, Hamilton DP, Spencer C, 12 April 2012) at paras 19–20.
[10] Explanatory Memorandum to Fair Work Bill 2008 at para. 778.
[11] Transitional Act Sch 3, Item 3.
[12] Transitional Act Sch 3, Item 30.