AG2015/144, Transcript of Proceedings [2015] FWCTrans 217 (13 April 2015)

TRANSCRIPT OF PROCEEDINGS

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Fair Work Act 2009                                    1051655-1

DEPUTY PRESIDENT ASBURY

AG2015/144

s.185 - Application for approval of a multi-enterprise agreement

Application by One Workforce
(AG2015/144)

Brisbane

2.11 PM, TUESDAY, 31 MARCH 2015

PN1

THE DEPUTY PRESIDENT: Good afternoon. Could I just start by taking the appearances, please. Mr McKenna, you're there representing the applicant?

PN2

MR MCKENNA: Yes.

PN3

THE DEPUTY PRESIDENT: Okay. Thank you. And I understand we have an appearance from the CFMEU, Mr Thomas?

PN4

MR S. THOMAS: Yes, your Honour.

PN5

THE DEPUTY PRESIDENT: You're seeking to be heard in relation to this matter?

PN6

MR THOMAS: Yes, we're seeking to be heard pursuant to section 590 of the Act, yes.

PN7

THE DEPUTY PRESIDENT: All right. Thank you. Mr McKenna, do you have any comment in relation to that?

PN8

MR MCKENNA: I didn't think any of our guys asked for representation from the CFMEU.

PN9

THE DEPUTY PRESIDENT: Well, they don't have to, Mr McKenna. The CFMEU is a default representative, if any of them are members, as is indicated in the notice of representational rights. Mr Thomas, do you want to give some basis upon which you say you should be heard?

PN10

MR THOMAS: Yes. Yes, your Honour. We don't make a claim to have any members in that context, and in that sense we don't claim to be a bargaining representative, nor to have access to this hearing by right of being a bargaining representative or in some other direct way. We seek that the Commission exercise its wide discretion pursuant to section 590 of the Act and to hear – in relation to informing itself as to the matter that is currently before it.

PN11

It is our submission, your Honour, that the CFMEU can make a positive and constructive contribution to the process of the Commission informing itself in relation to this application for the approval of an agreement. In saying that, we have – we made an approach to this Commission upon observing the application being put onto the web site. We expressed some concerns as to the content of that agreement. We have further concerns in light of seeing the F17 and F16, both application and statutory declaration.

PN12

We have concerns that the material before the Commission does not meet the requirements of the Act and we would seek to be given an opportunity to put those concerns to the Commission. In that sense, your Honour, I would say that it should be taken into account that the CFMEU Mining and Energy Division clearly has a history in the coal mining industry, and more so in Queensland. It is a union with in-depth knowledge and understanding of that industry. It is a union with an in-depth knowledge and involvement and participation in not only the modern award, but in many agreements. So in that sense it has, in my submission, a positive contribution to make.

PN13

We also note that there appeared to be no independent source of representation of the employees other than themselves, and that in this matter, in the absence of our being heard, there is no contradictor to the position of the employer. For those reasons, your Honour, I think it would be valuable for the Commission to allow the CFMEU to participate in such manner as it deems appropriate, and to offer what assistance it can to the Commission in carrying out its statutory task.

PN14

THE DEPUTY PRESIDENT: Mr McKenna, do you have anything you want to say in response to that?

PN15

MR MCKENNA: No. Most of the guys at the moment, they're at work currently. We're all working currently. I've been on night shift, so yes, it was hard to get people here, I'm guessing, more than anything.

PN16

THE DEPUTY PRESIDENT: Do you have anything you want to say about the CFMEU's argument that it should be heard in relation to the approval of the agreement?

PN17

MR MCKENNA: I look at the agreement from my point of view and go: there's nothing in that agreement that isn't, I suppose, really in the award. And none of the people have asked for representation from the CFMEU. I'm not sure.

PN18

MR THOMAS: Commissioner, can we just duck back to appearances for a minute, because there are two more of us on the line.

PN19

THE DEPUTY PRESIDENT: Yes. Sorry. Who else have we got?

PN20

MR METEYARD: Shane Meteyard.

PN21

THE DEPUTY PRESIDENT: From Milray Contracting?

PN22

MR METEYARD: That's correct.

PN23

THE DEPUTY PRESIDENT: Yes. And who's the other one?

PN24

MR ARNOLD: Grant Arnold from Milray too.

PN25

THE DEPUTY PRESIDENT: Thanks, Mr Arnold. Do either of you have anything you want to say about the CFMEU being heard in relation to the approval of the agreement?

PN26

MR ARNOLD: I think a couple of things, and just to follow up with what Steve said. Concerns that the process that was gone through, the guys haven't requested any representation from the CFMEU. The agreement, as outlined, is essentially, look, a cut and paste of other types of agreements that are quite similar that don't have any better or worse terms in them. The CFMEU might not agree and may not like the content and the make-up of the agreement, but we don't see why that should be an impediment to going forward, or that it should be approved.

PN27

THE DEPUTY PRESIDENT: All right. I understand your submission, but the reality of life is that I have some quite significant concerns with this agreement and whether the requirements of the Act for approval are met. And on that basis I do intend to inform you of those today, and then I intend to give the CFMEU an opportunity to inform me of any additional issues that it might have with the approval of the agreement, and we will go forward from there.

PN28

And I do intend to allow the CFMEU to be heard for that limited purpose, to just inform me if there are any issues that it sees that would prevent the approval of the agreement on the basis that either the pre-approval processes have not been complied with, or the agreement doesn't pass the BOOT. So that extent I am prepared to hear from the CFMEU in relation to those matters. I can indicate at the outset – can you just explain to me the relationship, if any, between the parties to this agreement. Is it a multi-employer agreement? It's a multi-enterprise agreement, so you're a number of separate entities all seeking to make an agreement?

PN29

MR METEYARD: So, Commissioner, the agreement is covering a number of employees that were going to be under those organisations when we first started constructing the agreement, with the purpose of eventually having one employer, being One Workforce. So that was the reason, is that there was a consortium of different companies that were getting together, and it was going to cover all of those employees, and then for becoming more, I suppose, streamlined, we will ultimately end up only with one employing company, called One Workforce.

PN30

THE DEPUTY PRESIDENT: Do the employees know - how do you propose to transfer the employees between - so all of those companies currently employ some employees who will be covered by the agreement?

PN31

MR MCKENNA: We have gone - it's Steve McKenna here - we have moved the employees out of SJDL into One Workforce. That happened in the last three weeks. So currently SJDL has no employees as part of the agreement any more, and Hornet Mining as well has no employees as part of the agreement.

PN32

THE DEPUTY PRESIDENT: How many employer parties are there to this agreement? At the moment it lists a range of Milray Contracting Pty Ltd, SJDL Pty Ltd, One Workforce Pty Ltd, Milray Employment Services Pty Ltd, and Hornet Mining Pty Ltd.

PN33

MR MCKENNA: Yes. Now it will be One Workforce Pty Ltd. That's where we've all - the guys have gone to that.

PN34

THE DEPUTY PRESIDENT: You've made an application for a multi-enterprise agreement, and now it's not a multi‑enterprise agreement, it's a single enterprise agreement.

PN35

MR METEYARD: There are still some employees in Milray Contracting.

PN36

THE DEPUTY PRESIDENT: That's not reflected in the document that the employees voted on, is it, because they voted on a document that indicated there were a range of employing entities, and now you say there are only two.

PN37

MR METEYARD: And at the time that was completely accurate. The reason why, as we constructed this document, that we chose to go that way, was we reviewed the One Key document and it enabled that to happen in an agreement that has already been approved by the Commission.

PN38

THE DEPUTY PRESIDENT: What One Key document?

PN39

MR METEYARD: It's a One Key enterprise agreement.

PN40

THE DEPUTY PRESIDENT: Okay. Not familiar with that one, I'm afraid. Have you identified that in your form F17?

PN41

MR METEYARD: No, because the form F17 was asking if there was anything that was substantial - anything that was substantial that had actually been copied in, and there wasn't anything substantial from solely the One Key enterprise agreement, but that certainly is an area that was in the One Key agreement that we looked at when we were constructing our document.

PN42

THE DEPUTY PRESIDENT: Okay. Given the extent of the concerns I've got with the aspects of the agreement, perhaps we can come back to the issue of who the parties are. The agreement at 3.3 indicates that it includes:

PN43

All benefits and entitlements relating to the employment of employees to whom it apples, and excludes operation of any award, agreement, industrial instrument, order, et cetera.

PN44

So this agreement is intended to stand alone and provide all the terms and conditions of employees. And then it goes on to say at 3.5 that:

PN45

Working hours and rosters are going to be under the supervision and management of the host client for any assignment.

PN46

If I take - it refers to the Black Coal Mining Award, and if I take, for example, that award, because it's arguable that this applies to employees beyond the Black Coal Mining Award when you look at the classifications it covers. But even if I take the Black Coal Mining Award, that has got an Hours Of Work clause that says:

PN47

There will be an average of 35 hours a week. These hours will be averaged over the roster cycle. There are rates of pay depending on the days of the week in which those hours are worked

PN48

And there's no reference to any of those matters in this agreement. All it does is provide wage rates that look to me to be exactly identical to the agreement. And in return - sorry, exactly identical to the award. Okay.

PN49

MR METEYARD: You need to read that in concert with 4.3. Because what happens is with the number of different clients that we work for that have different arrangements, different agreements and different aspects to how they remunerate:

PN50

Given the employer shall, in its discretion pay higher wage rates, this will be advised to the employee in writing.

PN51

So what that is is the clause. So when you look at the National Employment Standards that says it can't be - sorry, the better off overall test, as well as the Black Coal Award, what we're saying is nobody will be less than the Black Coal Award ‑ ‑ ‑

PN52

THE DEPUTY PRESIDENT: It doesn't say that at all. I'm sorry, who was that talking? Mr McKenna?

PN53

MR METEYARD: No, it's Meteyard.

PN54

THE DEPUTY PRESIDENT: All right, Mr Meteyard. It doesn't say that at all. What it says is you will - what I've just put to you is that you've got exactly the same wage rates as the Black Coal Award - exactly the same - no higher, no lower, they look to be, to the cent, identical to the Black Coal Award. You've got no hours of work provisions, there's nothing that says it has to be a 35-hour week or an average of 35 hours a week over a roster cycle. There's nothing that says anyone has to be paid more than the Black Coal Award.

PN55

All the agreement says is, "We're going to pay you an hourly rate which is exactly the same as the hourly rate in the award, and in return for that we're going to put you on various sites and you're going to work whatever rosters and hours apply on that site, and it's our discretion whether we pay you any more than the award." That's in a nutshell what this agreement provides for. I have to be satisfied at the point I approve this agreement that employees will be better off overall under this agreement then they would be under the award.

PN56

I can't see how I could possibly be satisfied on the basis of an agreement that has got no rosters; no work cycle; no undertaking or no statement anywhere that the ordinary working hours are an average of 35 per week over a roster cycle; that pays them bang on identical to what they would get under the award on an hourly basis; doesn't have anything about additional penalty payments for Saturday or Sunday work, for shift work, for overtime; says nothing about any of those things.

PN57

It just says, "We'll put you on a site and you'll just work whatever hours the company that operates the site has his rosters, and in return for that we're going to pay you this hourly rate that is exactly the same as the award." I can't see how it could possibly pass the better off overall test.

PN58

MR METEYARD: So notwithstanding the hourly rates in the agreement, we've modelled a lot of how this is constructed on the One Key agreement, and the One Key agreement actually provides less detail and what ours does around what will be paid, and it says that they will actually get a letter of offer at the start of each job or worksite that they go to. So when we looked at approved agreements - we looked at a number of agreements, theirs being one of them, and that was what were modelled it on.

PN59

THE DEPUTY PRESIDENT: Okay. I'm just opening up now, looking at the One Key agreement, which was approved by Commissioner Cambridge. Just trying to understand what - and the fact that another member of the Commission might approve an agreement, it has also been accompanied by undertakings, which I'm not sure - I mean - but basically forget the One Key agreement, okay.

PN60

I'm more interested in how you say people will be better off overall, because under the terms of this agreement you can put them on a mine site or any site you want and say, "The hours of work will be 60 per week, because that's what the roster that the person who operates the mine site provides for, and we're going to pay you $20.76 an hour if you're a mine worker level I; $21.17 if you're level II."

PN61

MR METEYARD: No, that's your interpretation, Commissioner, and I know that you're the one who approves the document, so that's your interpretation. That is certainly not our intent, and that was not our intent when we had it written.

PN62

THE DEPUTY PRESIDENT: Well, that's what it says.

PN63

MR METEYARD: No, I understand that's what you believe it says.

PN64

THE DEPUTY PRESIDENT: That's what he says.

PN65

MR METEYARD: That's actually not - as I said, when we looked at constructing the agreement, I looked at a number of agreements of allied parties that we would actually be in competition with to see how they construct it is, and I was of the understanding that if the One Key agreement actually passed the better off overall test, then we would also meet that. So what theirs says is when you are on an assignment you can be employed as a casual employee, fixed‑term employee or a permanent employee; you will receive a letter of offer at the start of each assignment that will set out your employment status and your pay rates.

PN66

THE DEPUTY PRESIDENT: Yes, that's very nice. I'm sure that's very useful and helpful, but it doesn't mean - the fact that you have discretion to pay them more than the award doesn't mean I can be satisfied that the agreement passes the BOOT. I have to be able to - I mean, I don't know how I could possibly apply the BOOT because I don't - there are no rosters in there, there's nothing that says, "You will work as required. However, for any hour that you work in excess of an average of 35 hours a week, you will get overtime rates."

PN67

There's nothing that says, "For every hour you work on the Saturday you will get the first four hours of time and a half and thereafter at double time." There's nothing that says, "When you were on a Sunday you're paid a double time." That's what they would get if they were under the Black Coal Award.

PN68

So how can this agreement and be satisfied that - effectively you've put the same wage rates as the award in, but you've removed every other provision that governs when ordinary hours will be worked, the days of the week that will have worked on, how many will be worked in a week at ordinary rates, how many have to be worked at time and a half, how many have to be worked at double time; shift payments, allowances, everything is not here other than the base rate in the award.

PN69

MR METEYARD: But when we go to a site, you're under the - say if you go to a BMA sites, you've got to work under their fatigue policy and they're hours of work, so you're not allowed to do more hours than what they say.

PN70

THE DEPUTY PRESIDENT: That's fine, you can work under their hours of work. What I'm interested in is what you're going to pay your employees for working those hours of work. I'm not saying they can't work the same hours of work as BMA employees, but I do know that BMA employees are not paid exactly the award rate with no penalty payments for working the rosters that they work.

PN71

This agreement allows you - on a reading of this agreement, it allows you to put those people on site and say, "You shall work the BMA rosters, whatever they are; and for every hour you work, we're only going to pay you $21.17 an hour if you're a mine worker level I induction, and so much if you" - exactly the base rate under the award with no penalty payments, no overtime, no nothing. And I can't be satisfied that passes the BOOT. Or if I'm wrong there, tell me how I can be satisfied it passes BOOT.

PN72

MR MCKENNA: We paid a casual loading, 25 per cent.

PN73

THE DEPUTY PRESIDENT: Which is a casual loading. And that, under any other award - for starters, there's no casual loading in the Black Coal Award because there are no casual provisions for production and engineering employees. But let's accept that you're going to pay a casual loading of 25 per cent; that casual loading covers annual leave, sick leave and other entitlements that casual employees don't get, it doesn't cover overtime or anything of the sort. So that doesn't cut it either, I'm afraid. That casual - - -

PN74

MR MCKENNA: We currently pay a flat rate to our guys. No one is going to come out to the mines and work for $25 an hour. You would just stay at home.

PN75

THE DEPUTY PRESIDENT: Unless I'm gifted with psychic powers - and I can assure you, Mr McKenna, Mr Meteyard and Mr Arnold, I'm not - as far as I can see from this agreement, you're paying people - or you will be entitled under this agreement - if I approve this agreement you could legally say to one of your workers, "Go forth to a BMA mine, work 60 or 70 hours a week, and in return we are going to pay you as a level I at $20.75 an hour; if you're a level II induction, 21.17 an hour, and so forth; and if you're an advanced mine worker, $26.15 per hour," which is exactly the ordinary hourly rate in the award, notwithstanding that under the award you would get the first 35 hours at that hourly rate, and thereafter you would get overtime and penalty payments and additional amounts if those hours worked on the weekends.

PN76

So I can't for the life of me see how could possibly be satisfied that this agreement passes the better off overall test just that provision. It says:

PN77

Overtime: in addition to rostered hours you may be rostered to work reasonable additional hours.

PN78

It doesn't say what you will get paid for it, so the agreement is silent there.

PN79

And it completely overrides the award, so there's no overtime as far as I'm concerned. I can't see how - I accept you might pay them more in reality, but under this agreement - well, you might have to, under this agreement, you will be able to send them out wherever you like, and at the end of the day they're probably better off under the award and they would be under this agreement, because they would at least have a guarantee that the average ordinary hours over a roster cycle of 35; that in addition to that, they would get overtime; they would get penalty rates on Saturdays and Sundays; they would get shift loadings; and a range of other things under the award.

PN80

MR MCKENNA: So if we would put in the agreement a minimum base rate, that would be okay? If we would say, like, okay, the minimum rate that we can pay a guy, including overtime and that's the stuff, is $40 an hour, would that satisfy the Commission?

PN81

THE DEPUTY PRESIDENT: It might, it might not, because I don't know - if you're going to pay a loaded base rate for every hour the people work, there is a tipping point at which they stop being better off than they would be under the award, because $40 an hour is double the minimum rate in the award for an induction level I employee, it's not double the minimum rate for an advanced mine worker. And there will be a tipping point at which when they work more than that number of hours, they will be better off under the award, so I would need to know the tipping point.

PN82

You might need to say, "Here's our loaded hourly rate, and at this point we accept that they stop being better off, so they won't work at that rate past X number of hours a week," but you would have to come up with something like that. And then the difficulty that you've got is that that is not what your agreement says, and you would have to give undertakings; and frankly, I have so many concerns with this agreement that you're going to end up with more undertakings then you've got agreement, and then you're substantially changing it.

PN83

MR MCKENNA: At 4.2 of the award it says, "Wages paid as per this agreement shall not fall below the minimum wage in the Black Coal Mining Award, as varied from time to time."

PN84

THE DEPUTY PRESIDENT: Yes. And all that means is that if the Black Coal Mining Award - and if an increase of 1 per cent or 2 per cent goes on the minimum wage in the Black Coal Mining Award, you will have to add that to your minimum wage. So once again you will be exactly the same as the Black Coal Mining Award, and you will have people working goodness knows how many hours, goodness knows how many days straight, with no guarantee that they're going to get any of the other ‑ ‑ ‑

PN85

MR MCKENNA: You have to work under the fatigue policy of the mine, so you can't do - and this is the issue, too, you have, is one mine will have a different fatigue policy than another mine. We will work between different mines. I do emergency response, so when a coal mine caves in, we go in and fix it up. We might be at one mine, working under their fatigue policy, reach our maximum hours and have to have our three, four or five-day break in between, and then go for ‑ ‑ ‑

PN86

MR METEYARD: Steve, I think what the Commissioner is saying is that she acknowledges that, but it's not clear enough in the agreement, how we would remunerate for that as a minimum.

PN87

MR MCKENNA: Yes. Okay.

PN88

MR METEYARD: So I think I will let Grant make a few comments, because we need to actually work out what we need to do to move ‑ ‑ ‑

PN89

THE DEPUTY PRESIDENT: I think what you need to do is go back to the drawing board and get some professional advice about how to draft this agreement so that it meets the requirements of the Commission with respect to approval. Now, I've approved a number of - I've approved, I think, some contracting agreements in the mining industry in recent times. I will send you a copy of those agreements, because they're available on the public record. But I can assure you, I will not approve an agreement unless I know the parameters of a roster. So you can say, "We will work as per our client's requirements."

PN90

I don't have a problem with that, but I want to know is, "If our employees work more than an average of 35 hours a week over a roster cycle, they will be paid more than they would be paid under the Black Coal Award." And at the moment I don't see how I can be satisfied that that's the case.

PN91

MR METEYARD: And I understand that. the only thing - and I know that you were saying that other Commissioners have approved things, and that's not necessarily your concern, but as I looked at the One Key agreement, there was not one rate put in there, because what they did was they allowed them the flexibility to be able to put a letter of offer to a person at the start of every contract, depending on what the client needs were, the site fatigue policies, and other contributing factors. So I understand that you're saying that if we're not to put in there the specifics about the overtime, et cetera, that you're not going to approve it. And I understand that. I'm just struggling with having a look at their agreement to see ‑ ‑ ‑

PN92

THE DEPUTY PRESIDENT: Can I tell you, I'm looking at their agreement now, and Commissioner Cambridge required an undertaking that said:

PN93

Your terms and conditions of employment will be regulated by the relevant award, as amended from time to time, and regulated by a means that this agreement incorporates any relevant award or agreement that may ordinarily apply.

PN94

So what that means is that One Key had to give an undertaking to Commissioner Cambridge that basically said that the Black Coal Industry Award, where it would otherwise apply, is completely incorporated into the agreement, so that all of those hours of work and all those other provisions are taken as applying. And you haven't got that.

PN95

What you've got is a clause that says, "This completely overrides every award and agreement and every other document that could possibly regulate the terms and conditions of employment of these employees," and you've been pretty exhaustive about it, overriding everything, and, "Instead of all those things in the Black Coal Award, we're just going to pay the basic minimum hourly ordinary time rate in that award."

PN96

So yes, Commissioner Cambridge approved the One Key agreement, but you need to look at the undertaking that he required in order to approve that agreement, because your agreement doesn't incorporate awards, it excludes them. And it's not only the Black Coal Award that would give me concern, because you've got a range of classifications here, including administrator or functional person. You've got a whole lot of people here who may not be covered by the Black Coal Award.

PN97

MR ARNOLD: Actually, just while you're on that, Commissioner, are we better off - and I'm asking some questions - are we better off having a clause similar to that One Key agreement that does provide that it will cover potentially multiple awards or multiple industries? Because it may be that some of the contracts we get might be outside of coal, they might be in (indistinct) as an example?

PN98

THE DEPUTY PRESIDENT: Well, that ‑ ‑ ‑

PN99

MR ARNOLD: So are we better to have a clause like that that and not have a specific reference to the Black Coal Award or any award?

PN100

THE DEPUTY PRESIDENT: I'm sorry, I can't give you advice about how to draft an agreement in that sense.

PN101

MR ARNOLD: Yes, okay.

PN102

THE DEPUTY PRESIDENT: But what I would indicate is my view is I'm not comfortable with an agreement that just says, "Whatever award might apply to you, we'll comply with it." I would need to know what awards you say operate in conjunction with this agreement. And if you're going to do that, when you make the agreement with employees, you have to show them the awards.

PN103

If you're going to incorporate awards in it, you have to show them awards. And when they get an offer of employment, these agreements say, "We will tell you what award applies to you other than for this agreement," and that way they know where they go and look if they want to know what they should have been paid, so they can make sure they are paid more than they would be entitled to. The better off overall test is "better off", not "the same".

PN104

MR ARNOLD: Yes.

PN105

THE DEPUTY PRESIDENT: So if you just want to have an agreement that says, "We will pay you exactly like the award," I'm not satisfied that results in better off overall either.

PN106

MR ARNOLD: Yes, okay.

PN107

THE DEPUTY PRESIDENT: Are you a member of an employer organisation, any of you?

PN108

MR ARNOLD: No, I'm not.

PN109

MR MCKENNA: No.

PN110

THE DEPUTY PRESIDENT: You're not?

PN111

MR MCKENNA: No.

PN112

THE DEPUTY PRESIDENT: Okay. Well, other than that, you probably need to get some advice about these matters. There's an enterprise bargaining bench book that has recently been put on the Fair Work Commission web site. I can get my associate to send you a link to that, if that will assist.

PN113

MR MCKENNA: Yes, that will be good.

PN114

THE DEPUTY PRESIDENT: But at the moment I just can't see how this agreement can get through the requirements, the way that it's drafted.

PN115

MR MCKENNA: If we could give the undertakings, the same as One Key, would that be sufficient?

PN116

THE DEPUTY PRESIDENT: I would need to - no, it might not be. I would need to look at it, I'm afraid, because there are other things in this agreement that concern me. And the other issue will be you would now be incorporating an award in circumstances where you're essentially changing the agreement so much that I don't know whether - I would need to see what your proposed undertaking is, and I will give you an opportunity to put one in.

PN117

MR MCKENNA: Yes.

PN118

THE DEPUTY PRESIDENT: But an undertaking can't change an agreement so substantially that it's a different agreement.

PN119

MR MCKENNA: Yes.

PN120

THE DEPUTY PRESIDENT: I will send you an example of a labour hire agreement that I think operates in a similar way to the one that you want to have that I have approved, which Mr Thomas, for your information, is the BCM Labour Solutions Agreement.

PN121

MR THOMAS: I'm aware of that, your Honour.

PN122

THE DEPUTY PRESIDENT: Frankly, I am not about unreasonably stopping employers from making enterprise agreements, but I'm at the point where I'm not comfortable, I'm not satisfied that this agreement passes the better off overall test, and I can't see a way to salvage it. However, I'm required to offer you an opportunity to attempt to salvage it, which I'm happy to do, but what I would suggest is that instead of spending time trying to salvage something, you go back to the drawing board and make an agreement that's going to meet the requirements of the legislation. And I've tried to explain them to you as best I can.

PN123

MR MCKENNA: Okay. Were those the only outstanding issues?

PN124

THE DEPUTY PRESIDENT: Well, okay. No. Deductions from wages; there's a section in the Fair Work Act that talks about what is a reasonable deduction from people's wages, and you can't deduct to the level where their wage goes below a certain amount, and the Act covers it, so I would want something that says that there will not be deductions from people's wages other than in a way that is consistent with the requirements of the Act, which I will be happy to refer you to and send you a copy of.

PN125

Clause 11.1, requiring disclosure of pre-employment information; I would require an undertaking, because if they don't disclose something, then they're arguably breaching the agreement, and they can be exposed to civil penalties for breach of the Fair Work Act, so I would require a provision or an undertaking, or a provision that says that it won't expose them to a breach of the Fair Work Act if they don't provide or disclose information.

PN126

The stand-down clause would need to be consistent with the stand-down provisions in the Fair Work Act, and at the moment that clause is not. And, Mr Thomas, I don't know if you had any other matters that you wanted to go through.

PN127

MR THOMAS: Your Honour, my issues fall into two categories. One is the pre-approval material, and I don't know if you want me to go to that right now; presumably it depends on whether the applicant wants to continue with this matter or chooses to take an alternative route.

PN128

THE DEPUTY PRESIDENT: Perhaps if you can just briefly indicate what the pre-approval issues that you have are, Mr Thomas, that might assist.

PN129

MR THOMAS: Yes, your Honour. Firstly, they are the ones that you've set out in your email to Mr McKenna prior to - on 10 February. I might need to say it (indistinct) we don't think the Commission will be satisfied that the employer has taken appropriate steps to explain the terms of the agreement. There's nothing in that F17 that goes into that detail. We say that the employer should be proactive. The mere fact that some questions aren't asked doesn't mean that you can be satisfied that it has been explained.

PN130

We find that in this particular matter it seems to be a first agreement with no independent representation. There appears to be no negotiation whatsoever. People are in diverse locations, and in that regard, I don't think the Commission could be satisfied that the agreement has been explained properly. There appears they did nothing to satisfy the Commission that - how the employees were notified of the vote, when it was to take place, how it was to take place.

PN131

The material doesn't talk about what were employees told about their employee representational rights. I know the Commission, in its email, has asked for certain information on that part.

PN132

THE DEPUTY PRESIDENT: And I have received a copy of the notice of employee representational rights said to have been provided, which is in the required form, but what I haven't received is the letter that was provided and signed by employees regarding them not nominating a bargaining representative. Mr McKenna and Mr Meteyard and Mr Arnold, I would want to see a copy of that letter, because if it says anything that might mislead employees about their rights to appoint a bargaining representative, that would be an issue that would prevent the agreement being approved.

PN133

MR MCKENNA: I thought I had sent all of that stuff to ‑ ‑ ‑

PN134

THE DEPUTY PRESIDENT: No, you only sent the notice of employee representational rights, as I can see. Just bear with me for a minute, I'm just flicking through what was sent. Yes, all I've got is the notice of employee representational rights.

PN135

I don't have anything that indicates what people were told about appointing themselves as a bargaining representative or not appointing a bargaining representative at all, which I would need to see, because you cannot add something to a notice of representational rights or put a covering letter on it that misleads employees or confuses them with respect to their rights to representation, if they wish to have it. So I would need to see whatever was given to them. Sorry, Mr Thomas, I cut you off.

PN136

MR THOMAS: Your Honour, with respect to the bargaining representatives, in 2.2.5 in the F17 it said that each employee signed a letter regarding them not being a bargaining representative, yet if you go to point 5.3 in their F16, it lists 11 bargaining representatives. How the Commission can be satisfied on the notion of bargaining reps when you've got this sort of contradictory information. Further, there's no indication ‑ ‑ ‑

PN137

MR MCKENNA: They chose not - they chose not to have an agent. They chose to actually be self-representing.

PN138

THE DEPUTY PRESIDENT: Well, we need ‑ ‑ ‑

PN139

MR THOMAS: I'm only relying on what's in the application, which says there are 11, and names 11 bargaining representatives. There's no indication that any of the instruments of appointment have been completed, as per section 178 of the Act.

PN140

MR MCKENNA: We sent out a form that we got off the web site that explained to them bargaining representation: if you wanted union to represent you, these are the numbers that you contact. All of that was sent to them.

PN141

THE DEPUTY PRESIDENT: Yes, but I would need to see what else was sent to them about it, because you've said that they signed a letter regarding them not nominating a bargaining representative; and then as Mr Thomas points out, in answer to five point ‑ ‑ ‑

PN142

MR THOMAS: Three.

PN143

THE DEPUTY PRESIDENT: I don't even have a 5.3.

PN144

MR THOMAS: 5.3 in the F16, in the application, your Honour, not F17.

PN145

THE DEPUTY PRESIDENT: Sorry, yes, in the F16 application.

PN146

MR THOMAS: It lists 11 bargaining representatives.

PN147

THE DEPUTY PRESIDENT: It lists 11 bargaining representatives. So obviously if those people were appointed by other employees as their bargaining representatives ‑ ‑ ‑

PN148

MR MCKENNA: No, no. Commissioner, at the back of the agreement all of those letters are actually scanned as part of the agreement, regarding a bargaining representative.

PN149

THE DEPUTY PRESIDENT: What was sent to them that they responded to, saying, "We've decided not to appoint a bargaining representative?"

PN150

MR MCKENNA: So we provided them the document that we were asked to provide them, and the advice or direction that came was to provide it without alteration.

PN151

THE DEPUTY PRESIDENT: Yes.

PN152

MR MCKENNA: I can't remember what the exact document was, I think it was the ‑ ‑ ‑

PN153

THE DEPUTY PRESIDENT: Yes, it was the notice of representational rights. But the issue is what did you send, covering it, so that they would feel the need to respond and say, "I've decided not to appoint a bargaining representative?"

PN154

MR MCKENNA: So what - because it seemed to be a contentious issue, we actually had - we provided them that document as requested, and we then said to them, "We've drafted a letter. If you're happy with this letter, please sign it." Right. That was a letter from them to us. So we wanted to have a paper trail, so to speak, to say that they actually agreed that there was some notification to us that they didn't want to engage a bargaining representative.

PN155

THE DEPUTY PRESIDENT: So where was the letter telling them about the letter headed Re Bargaining Representative? Where's that letter?

PN156

MR MCKENNA: That was a conversation that was held with them, with the letter, because we didn't realise we had to send them a letter to explain the letter. We thought that the letter that we were told - the document that we were told ‑ without alteration.

PN157

THE DEPUTY PRESIDENT: I'm not saying you have to send them a letter to explain the letter, Mr McKenna. What I'm wondering is why this many people would spontaneously decide to tell you that they don't want to appoint a bargaining representative to act on their behalf.

PN158

MR MCKENNA: They didn't spontaneously - I just explained, Commissioner, that they didn't spontaneously decide to do it. We had a conversation with each of the individuals and told them what their rights were if they wanted to actually engage a representative.

PN159

And we said to them, "So that we can make sure that if anybody asks, and to be clear, any time from now and into the future, we would like you to actually sign this letter, if you agree with it, to make sure that we've got a document that says that you do not want to engage a bargaining representative, so that we know exactly who we're bargaining with and who we're talking to in the roll‑out of this agreement."

PN160

THE DEPUTY PRESIDENT: All right. It's just not clear from the employer declaration, and neither is it clear what action you took to tell them what date and time the vote was to occur, and how the vote was to be taken.

PN161

MR MCKENNA: I am positive I forwarded all this today. Absolutely positive.

PN162

THE DEPUTY PRESIDENT: But it's blank. The answer to that question is blank. There's nothing in it, so I don't know.

PN163

MR MCKENNA: Okay.

PN164

THE DEPUTY PRESIDENT: There's no information. Anyway, sorry, Mr Thomas.

PN165

MR THOMAS: The confusion gets worse as we go further on, your Honour. They say that - in 2.8 of F17 - that the date of the last notice of representational rights was given to employees on 4 January. Then if you go back to 2.4, they say that a letter provided and signed by each employee regarding them not nominating a bargaining representative took place on 21 January, which also happened to be the same day that the voting opened. So it's a bit difficult to understand what's going on.

PN166

MR MCKENNA: That was the original mistake, and it was a mistake that we made, then we had to go through the whole process again to get people to sign up again. Like, we made a mistake, we admitted that we made a mistake, then we went on and we re-did the process, waited the correct amount of time and re-did it again.

PN167

MR THOMAS: Your Honour, from what I can see, this letter from the employees not nominating themselves as a bargaining rep was signed on the 27th. I don't know if that's the last - in effect, the last day that you can talk about employees being given a notice of representational rights, but if that's the case, then clearly the 21 days before you can request a vote hasn't been met.

PN168

THE DEPUTY PRESIDENT: No, it's stated that the last notice of representational rights was given on 4 January.

PN169

MR THOMAS: On the 4th, yes. So then we have this other thing that pops up on the 27th about them rejecting - inform the employer that they don't want to be bargaining reps, so I don't know what relevance that is. But to go further, your Honour, according to 2.4 and 2.5 in F17, a copy of the enterprise agreement was provided on 4 December.

PN170

THE DEPUTY PRESIDENT: Yes.

PN171

MR THOMAS: According to 2.4, taken at its most generous, the notice of employee representational rights emerged on 4 January. So the agreement was actually put to people one month before the notice of employee representational rights. Section 173 provides that the employer must give the employees the notice of notice of employee representational rights not later than 14 days after the notification time, with the notification time being the time the employer agrees to bargain or initiates bargaining.

PN172

Clearly in this regard section 173 has not been met. It's clear, your Honour, that may not be fatal, but it's certainly indicative of the absence, we say, of a genuine agreement being reached. Then there's another set of what we say are peculiar circumstances. This is the second application, your Honour. Comparing the dates the applicant was seeking to have the agreement made, it was at the same time that it had already made an agreement for the same agreement and was before the Commission.

PN173

THE DEPUTY PRESIDENT: Yes.

PN174

MR THOMAS: That's in AG2014/8377. It makes you wonder why would an employer distribute the same agreement and commence the same process that it had just completed, and for which it had filed an application in the Commission.

PN175

THE DEPUTY PRESIDENT: Because the first agreement - because, I think from memory, that this is the second attempt, because the first agreement ‑ ‑ ‑

PN176

MR MCKENNA: That's correct.

PN177

THE DEPUTY PRESIDENT: There wasn't compliance with the pre-approval step, Mr Thomas, and I had a hearing and told them that, or I wrote to them and told them that, and they ‑ ‑ ‑

PN178

MR THOMAS: My recollection was that that came much later. But I'm just adding that in as some of the more confusing elements.

PN179

THE DEPUTY PRESIDENT: Okay. Yes.

PN180

MR THOMAS: Now, some other quite important things, your Honour, are: what is the relationship between these companies? Section 172(3) states that a multi-enterprise agreement can only be made by companies that are not single‑interest employers, as defined in 172(3), namely they're not a joint venture or a common enterprise, related bodies corporate, or for which there's single-interest employer authorisation.

PN181

There's nothing before the Commission to point out the relationship between these corporations, and as to whether or not they can, in fact, make a multi-employer - a multi-enterprise agreement. The next question in that sense was: who is the employer or employers of the 11 employees covered by the agreement? Earlier, your Honour, on that point, at the beginning, we were told, if my notes are correct, that initially they were employed by SJDL but then they were transferred to One Workforce. Now, SJDL no longer has any employees, and I assume that prior to that transfer, One Workforce didn't have any employees. And we're told that Hornet has not employees. Your Honour, where the Act states that an agreement can only be made with an employer that has more than one employee. So it appears that we have employers who are seeking to be covered by this agreement who don't employ anyone, and they cannot be parties to - or be covered by an enterprise agreement.

PN182

MR MCKENNA: Which we can resolve very clearly by making an undertaking that One Workforce will be the only employing entity going forward. This has evolved from when we were putting this together. And as I said, your Honour, I looked at the One Key agreement, which has got seven different bodies that it actually had in its agreement. So we used that as the basis to be able to actually put these companies together, because we were going through the legal process of moving to One Workforce as the sole employing entity, which we've still not fully concluded.

PN183

MR THOMAS: It's for the Commission to accept undertakings. I'm not saying that an undertaking doesn't cover this sort of pre-approval issue. This is a technical issue, not an issue to deal with the BOOT. The other important thing in here, your Honour, is what is the outcome of the ballot? Because if there are five or four employers who are multi‑enterprises, then each company has to have a ballot, and it has to be approved by a majority of each of the employees in each of the companies.

PN184

There's nothing before the Commission on that. I refer your Honour to section 182 subclause (2), and also 184 of the Act, such that if an enterprise agreement was not approved by all of the employers, then those who did not approve the agreement must be removed. That, of course, assumes that you have a legitimate employer with some employees in the first place, and that's fairly clear that that is not the case here. So we would say that that is a major technical problem with the approval of the agreement.

PN185

Now, your Honour, if we go to the F17, and I take your Honour to point 2.16, it says:

PN186

Please identify the clause in which the agreement that defines shift workers for the purposes of the NES.

PN187

And it refers to 7.3. With all due respect, 7.3 doesn't say a word about defining shift workers for the purposes of the NES. So, you know, that, your Honour, is quite clearly incorrect.

PN188

In the paragraph under that it refers to annual leave being, "As per the NES requirements." As I will come to in a minute, the problem with that is that the Black Coal Award's annual leave requirements are in excess of the NES. Your Honour, in 3.3 in the F17 it says:

PN189

Are any of the classifications in the instrument in the agreement different from the classifications in the reference instrument?

PN190

They say yes, which is true.

PN191

If you have answered yes to question 3.3, please attach a table.

PN192

There is no table which could give the Commission any idea of trying to work out those classifications.

PN193

3.4 says:

PN194

Does the agreement contain any terms or conditions of employment that are more beneficial?

PN195

It says yes. I would like them to point out one. Then it asks them to list them, and they talk about the hourly rate. Now, your Honour has already been around the mill on this, that the hourly rate or the weekly rate in the agreement is the same as the award. It's not more beneficial, so that's wrong.

PN196

3.5, we talk about terms that are less beneficial, they say no. That is clearly wrong. And the same with 3.6. Your Honour, if you want to come to the BOOT without going into it absolutely chapter and verse on everything, I can point out a number of areas where they are significantly below the award. The classifications, for starters: in many areas there are no wage rates for the classifications that are mentioned in that agreement, and the absence of a table identifies that.

PN197

Annual leave: shift workers - certainly continuous shift worker and certain shift workers as defined in the award - get six weeks' annual leave, not five, as is the maximum in the NES. The hours of work: well, the Commissioner - your Honour, you've already referred to that, going through the 35 hour week, provisions for shift work, the provisions for weekend work, the provisions going to rosters. None of those - there's no provision for overtime.

PN198

On the termination of employment, your Honour would be aware that sick leave is paid out under certain circumstances in the award. There's no provision for that. The agreement has no provision for redundancy. Presumably it relies on the NES, but the NES provisions on redundancy are significantly lower than the provisions in the Black Coal Award.

PN199

The same with personal leave: whilst personal leave in the NES is 10 days, it's 15 days in the Black Coal Award. The Black Coal Award has accident pay, this agreement does not; the Black Coal Award has provisions for public holidays which, over and above the NES, make provisions for such things as what occurs or what rates are payable when you work on a public holiday ‑ ‑ ‑

PN200

MR MCKENNA: I don't think we wrote anything different to what was in the submission, though? I'm asking the question.

PN201

THE DEPUTY PRESIDENT: Sorry?

PN202

MR THOMAS: In the submission that went in well before Christmas, that's right. But one of your representatives said before that there's nothing in this agreement that's not in the award. I'm just pointing out to you that the agreement is a mere shade - mere shadow of the award.

PN203

Allowances are another. I'm not going in - because we could be here for an hour and a half if I went into every minute detail, your Honour. If you want me to, I could put it in writing.

PN204

THE DEPUTY PRESIDENT: No, Mr Thomas, I don't. I don't, thanks.

PN205

MR THOMAS: In our view there is no way they would meet the BOOT test. And to the extent that the Commission can accept undertakings, the undertakings would be three times the size of any agreement. And as the Commission pointed out earlier, that if undertakings constitute a substantial change to the agreement, which we say they would have to - particularly the number and breadth of undertakings - then the Commission, in our view, should be rejecting any undertakings that come before you.

PN206

Your Honour, it's not for me to tell this company - I'm certainly not going to give it any hints, considering it doesn't want to negotiate an agreement with the union. What I will say, if you want to rely on that One Key exercise, then you may well end up back where you started from. I've only just seen that agreement, and certainly from what I'm reading, it looks like it's just the same as the award, but I haven't read it in detail.

PN207

Your Honour, it would be our submission, subject to what you wanted to do, that this agreement should not be approved. And as you rightly said, the company should go back to the drawing board. They're an outline of the issues.

PN208

THE DEPUTY PRESIDENT: Thanks, Mr Thomas. Mr McKenna, Mr Meteyard and Mr Arnold, I would refer you to the email that was sent from my chambers on 10 February, because that did indicate that the form F17 has to be completed for each employer. Because if you're going to say these are separate employers and they're not related entities, or they're not joint venture or common enterprises, they're all separate employers, even if there are still only two of them, each of them has to have a separate ballot and have a valid majority of their employees sign the agreement.

PN209

I think events have overtaken this so much that it may be more appropriate that you go back to the drawing board and make an agreement with the employees of the entities that actually employ people. Because if some of these entities don't employ anybody, then they can't make an agreement.

PN210

MR METEYARD: Yes.

PN211

MR ARNOLD: All right.

PN212

MR MCKENNA: Yes, agreed.

PN213

THE DEPUTY PRESIDENT: I will leave it up to you. I will release this transcript and give you a copy of it. If you want to take on board the matters that have been raised and try to resurrect this agreement, then you're welcome to do that, but I think you need to consider whether you should go back to the drawing board, taking into account the guide book that's now on our web site, it's called The Guide to Making an Enterprise Agreement. It's on the Fair Work Commission web site, and how you have to go about ‑ ‑ ‑

PN214

MR MCKENNA: When did that get put up?

PN215

THE DEPUTY PRESIDENT: Sorry?

PN216

MR MCKENNA: When did that guide go up?

PN217

THE DEPUTY PRESIDENT: It's quite recent, I think. It's only the past - 2 October 2014.

PN218

MR MCKENNA: All right. No dramas. I will find it.

PN219

THE DEPUTY PRESIDENT: My associate will send you a link to the pieces of information that are on our web site in that respect. But I just think the difficulties with this agreement are pretty much insurmountable. You need to look at the time frames in which you have to do things. It would appear that they haven't been met. There are some significant issues with the process that you've gone through, pre-approval, and if you can get through those issues, you've got some significant issues with the agreement itself.

PN220

MR ARNOLD: Just while we're talking about the agreement, can I just have a bit of a review: the issues were the employing entities; the references to the award and all that that entails; the rates; the deduction of wages; and the stand-down provisions.

PN221

THE DEPUTY PRESIDENT: Yes, but it's not just a list of things on one hand that are minor problems.

PN222

MR ARNOLD: Yes, I take that on board, Commissioner. I'm not saying that they exist singularly, it's in their entirety. I'm just trying to get my point of view.

PN223

THE DEPUTY PRESIDENT: Yes, they're a quite substantial list of issues that - by removing the reference - by overriding the award completely, that means that all that you're left with is the agreement, so - there's nothing in the agreement, as Mr Thomas rightly points out, about all of those things that are in the Black Coal Award, this agreement is silent on them, therefore by virtue of the fact you've overridden the award, they don't apply.

PN224

MR ARNOLD: Yes.

PN225

THE DEPUTY PRESIDENT: I've attempted to explain that in an email and in this hearing. I would like you to take seven days to consider what you want to do with respect to this agreement, and if you want to withdraw and go back to the drawing board, you're welcome to do that; if you want to attempt to offer some undertakings, you're welcome to do that.

PN226

You should at least peruse our bench book or our guide to agreement-making, and I will also send you another agreement that I have approved, but that was not without significant undertakings being given, and you need to look at the undertakings and what the test is.

PN227

It's not a difficult test. I have to look at the agreement and say, "Would the employees working under the same conditions, hours of work, work places, work sites, et cetera; would, under this agreement, they be better off than they would be for working in those same conditions, under the same terms, for the same hours, at the same times, as they would be under the award? That's the BOOT. They have to be better off, not the same, and certainly not worse.

PN228

MR ARNOLD: Yes.

PN229

THE DEPUTY PRESIDENT: All right. On that basis I will adjourn.

PN230

MR THOMAS: Your Honour, can I just mention that if the company does decide to put some undertakings to you, which you're right to consider, if it was to go any further, we would like to certainly address you further on those other sort of pre-approval issues, because we don't believe that the company has satisfied those, let alone the BOOT.

PN231

THE DEPUTY PRESIDENT: Yes, I understand that, Mr Thomas, and I note your request. Thank you. On that basis, I will adjourn.

ADJOURNED INDEFINITELY                                                           [3.20 PM]