AREEA reviews a recent Full Bench decision which saw the CFMEU successfully appeal the approval of a mine contractor’s enterprise agreement.
A CONTRACTOR to Fortescue Metals has had its 2016 Enterprise agreement approval quashed by a Full Bench of the Fair Work Commission in a CFMEU appeal.
The CFMEU appealed the original decision made by Commissioner Roe on 9 December 2016 approving the CSRP Enterprise Agreement 2016 (Agreement).
The Full Bench rejected CSRP’s challenge to the standing of the CFMEU to prosecute the appeal and found the union did have interest in the agreement because some of their members will likely be employed by CSRP in the future.
CSRP argued that the union did not have standing in the matter as the union did not have an agreement bargaining representative, nor a member who was employed by the company, however, the Full Bench allowed the CFMEU the right to appeal.
AREEA has noted this is becoming a worrying trend for unions successfully interfering in a previously settled agreement approval process.
The CFMEU argued Commissioner Roe made an error in determining the CSRP agreement was genuinely agreed to by the employees.
The union submitted that the pre-payment of annual leave and when it could be taken, and the right to refuse working on a public holiday, was unfavourable compared to the National Employment Standards within the Fair Work Act.
The Full Bench comprised of Vice President Hatcher, Deputy President Gostencnik and Commissioner Bissett considered CSRP’s claims the agreement covered employees who would be working at mining sites in remote locations, so that the Rostered Hours of employees will inevitably involve swing cycles.
CSRP accepted that the first paragraph of the annual leave provision reproduced was a term that allowed it to require an employee to take annual leave in accordance with the cycle of Rostered Hours.
“Such roster arrangements could reasonably require employees to take annual leave in a way that accorded with the fly-in, fly-out schedule for their swing cycle,” CSRP submitted.
The Full Bench determined the agreement’s terms were contrary to the National Employment Standards by limiting the circumstances in which an employee could take annual leave by agreement with his or her employer in accordance with s.88 of the FW Act.
The Full Bench granted the appeal on the ground ‘error’ in the decision was established, and, “the nature of the error identified raises for consideration the proper administration of the agreement approval powers of the Commission”.
In coming to a decision, the Full Bench noted the agreement met the requirements in ss.186 and 187 of the FW Act but was concerned it did not meet the requirements set out in s.186 (2)(c) of the FW Act.
The Full Bench quashed the decision and will re-hear the application for the approval of the agreement.
An opportunity for CSRP to address the concern raised was granted, with the Full Bench giving the employer 14 days from the date of the decision to provide a written undertaking “to allow an agreement to continue operating”.
“If we are satisfied that the written undertaking meets the concern and otherwise satisfies s.190 of the FW Act we would propose to approve the Agreement,” the Full Bench stated.
Implications for members
This Full Bench matter is another timely reminder that it is common practice for unions to closely monitor newly-approved agreements on the FWC’s website and challenge those which it believes contravenes the FW Act and/or differ from commonplace union agreements in the respective sector.
This creates a risk for employers in agreement making that must be mitigated. It is vitally important for employers to ensure new agreements are fully compliant with the FW Act, particularly those agreements where employees and their employer have agreed to terms that are not those found in commonplace union agreements, which is typically the trigger for attracting union attention.
While in this case, the agreement was found to have contravened the National Employment Standards, it is a greater concern when agreements that comply with all aspects of the FW Act are successfully challenged by unions based on an argument the new agreement ‘undercuts’ existing union agreements in the sector.
From a policy perspective, AREEA’s position is there should be greater restrictions on third parties who are not party to an agreement, such as the CFMEU in this case, to intervene in the agreement making process. In our view, that future employees of CSRP may be CFMEU members or members of any union, should be of no relevance to the current status of the union as a ‘non-representative’.
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