ALDI Foods Pty Limited v Shop, Distributive & Allied Employees Association [2017] HCA 53 (6 December 2017)
Last Updated: 6 December 2017
HIGH COURT OF AUSTRALIA
KIEFEL CJ,
BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN
JJ
ALDI FOODS PTY LIMITED AS GENERAL PARTNER OF ALDI STORES (A LIMITED
PARTNERSHIP) APPELLANT
AND
SHOP, DISTRIBUTIVE & ALLIED EMPLOYEES
ASSOCIATION &
ANOR RESPONDENTS
ALDI Foods Pty Limited v Shop, Distributive & Allied
Employees Association
[2017] HCA 53
6 December
2017
M33/2017
ORDER
- Appeal
allowed in part.
- Set
aside orders 1, 2(b) and 3 of the Full Court of the Federal Court of Australia
dated 29 November 2016 and, in their place, order
that:
(a) the applicant's originating application for relief under s
39B of the Judiciary Act 1903 (Cth) be allowed in part; and
(b) a writ of mandamus issue directed to the second respondent, requiring
it to determine the first respondent's appeal from the decision
and orders of
Deputy President Bull made on 22 September 2015 in matter number
AG2015/3510 according to law.
On appeal from the Federal Court of Australia
Representation
G J Hatcher SC with A L Perigo for the appellant (instructed by Enterprise
Law)
W L Friend QC with A M Duffy and C J Tran for the first respondent
(instructed by AJ Macken & Co)
Submitting appearance for the second respondent
Notice: This copy of the Court's Reasons for Judgment is subject to formal
revision prior to publication in the Commonwealth Law
Reports.
CATCHWORDS
ALDI Foods Pty Limited v Shop, Distributive & Allied Employees
Association
Industrial law (Cth) – Fair Work Act 2009 (Cth) –
Enterprise agreements – Approval of enterprise agreements by Fair Work
Commission – Where employer in process
of establishing new undertaking
– Where existing employees in other undertakings of employer accepted
offer of employment in
new undertaking – Where enterprise agreement made
with those employees before new undertaking commenced operations –
Whether
agreement required to be made as "greenfields agreement" pursuant to
s 172(2) and (4) of Fair Work Act – Where Commission may
approve non-greenfields agreement under s 186 of Fair Work Act only
where satisfied agreement genuinely agreed to by employees covered by agreement
– Whether employees "covered by" agreement
from time agreement made or
from time employees commence working under agreement.
Industrial law (Cth) – Fair Work Act 2009 (Cth) –
Enterprise agreements – Approval of enterprise agreements by Commission
under s 186 of Fair Work Act – Where Commission, before
approving agreement, required to be satisfied that each award-covered employee
would be "better off
overall" under agreement than under relevant modern award
– Where Commission considered agreement passed better off overall
test
because clause in agreement entitled employees to payment of any shortfall in
entitlement under agreement as compared with entitlement
under modern award
– Whether Commission failed to engage in comparison between agreement and
modern award.
Words and phrases – "applies", "better off overall test", "covers",
"employees covered by the agreement", "greenfields agreement",
"will be covered
by the agreement".
Fair Work Act 2009 (Cth), ss 51, 52, 53, 54(1), 58(1), 172,
173(1), 176, 180(2)(a), 181(1), 182, 185, 186, 187(5), 188, 193, 207.
- KIEFEL CJ,
BELL, KEANE, NETTLE, GORDON AND EDELMAN JJ. This appeal concerns the
operation of provisions of the Fair Work Act 2009 (Cth) ("the Act")
relating to enterprise agreements. The parties agitated four issues. The first
issue concerns the power of the Fair Work Commission
("the Commission") under
s 186(2)(a) of the Act to approve an enterprise agreement for a new
enterprise made with existing employees of the employer who have agreed to work,
but
are not at that time actually working, as employees in the new enterprise
("the coverage issue"). The second issue was whether error
by the Commission in
relation to the coverage issue amounts to jurisdictional error amenable to
judicial review.
- The
third issue concerns whether the Commission fell into jurisdictional error in
being satisfied that the enterprise agreement in
this case passed the "better
off overall test" ("the BOOT") for the purposes of s 186(2)(d) of the Act
("the BOOT issue"). The fourth issue, raised by notice of contention, was
whether the decision of the Commission on the BOOT issue
was amenable to
correction by certiorari on the ground of error of law on the face of the
record, in the event that such an error
were held to fall short of
jurisdictional error.
- The
Full Court of the Federal Court of Australia determined the coverage and BOOT
issues against the appellant. As to the coverage
issue, the Full Court held
that approval of the agreement was beyond the jurisdiction of the Commission
under the Act because the agreement had not been agreed to by the employees
"covered by the agreement", in that the employees who voted in favour
of the
agreement were not at that time actually working under its
terms[1]. The
Full Court determined the BOOT issue on the basis that the Full Bench of the
Commission misapplied the statutory test as to
whether the BOOT was satisfied,
and so misconceived the jurisdiction conferred on it by the Act.
- For
the reasons that follow, it should be held that the Full Court erred in its
determination of the coverage issue, but decided
the BOOT issue correctly. In
those circumstances, it was not necessary for the Full Court, and it is not
necessary for this Court,
to determine the second and fourth issues.
- It
is necessary to begin with an understanding of the industrial and procedural
background relevant to both the coverage and BOOT
issues.
Background
- ALDI
Foods Pty Ltd as General Partner of ALDI Stores (A Limited Partnership) ("ALDI")
operates retail stores organised as distinct
undertakings in various regions of
New South Wales, Queensland and
Victoria[2].
ALDI's undertaking in each geographical region is treated as a separate
enterprise[3].
- In
early 2015, ALDI was in the process of establishing a new undertaking in Regency
Park in South Australia ("the Regency Park region").
In April 2015, it sought,
from its existing employees in its stores in other regions, expressions of
interest to work in the Regency
Park region. In late May 2015, ALDI made
written offers of employment to some of those employees who had provided an
expression
of
interest[4].
Each offer commenced with the words:
"I am pleased to advise that
Aldi Stores ... wishes to offer you ongoing employment as [position] in our new
Regency Park region in
South Australia, commencing when the new region opens.
... [W]e anticipate this will occur around October 2015 ... You will continue
to be employed until that date in your current region and will be covered by
that region's enterprise agreement."
- Seventeen employees
accepted the
offer[5]. ALDI
then commenced a process of bargaining with these 17 employees under the
provisions of Pt 2-4 of the Act for an enterprise agreement to cover the
Regency Park
region[6].
Neither the Transport Workers' Union of Australia ("the TWU") nor the Shop,
Distributive and Allied Employees Association ("the
SDA") were involved as
bargaining representatives for the new
agreement[7].
- At
ALDI's request, pursuant to s 181(1) of the Act, these employees voted on
the ALDI Regency Park Agreement 2015 ("the
Agreement")[8].
Clause 5 of the Agreement stated, among other things, that it would "apply
to the following classifications of Employees of ALDI
employed in the Regency
Park Region", with various job descriptions then being set out. Sixteen of the
employees cast a valid vote,
with 15 in
favour[9]. At
the time the vote was conducted, the Distribution Centre at Regency Park was
still under construction, and trading in the region
had not
commenced[10].
- On
4 August 2015, ALDI applied to the Commission for approval of the
Agreement[11].
The application for approval stated that the Agreement covered 17 employees
based on an agreement by a postal ballot of the employees
at which 16 employees
cast a valid vote, 15 of which were in favour of the
Agreement[12].
The application was listed for determination by
Bull DP[13].
The Deputy President approved the Agreement as operative from 29 September
2015[14].
- Both
the SDA and the TWU ("the unions") filed notices of appeal against the decision
of Bull DP to the Full Bench of the Commission.
Because the unions had not
participated in the proceedings before Bull DP, the issues agitated before
the Full Bench, the Full Court,
and now in this Court, had not been raised at
that earlier
stage[15].
Relevantly, for present purposes, it was contended that the Agreement should
have been made as a "greenfields agreement" under
the Act because ALDI was
establishing a new enterprise and had not employed in that new enterprise
any of the persons who would be necessary for the normal conduct of the
enterprise. In addition, it was argued that the Agreement
did not pass the
BOOT[16]. The
Full Bench (Watson VP, Kovacic DP and Wilson C) rejected these
contentions, and dismissed the
appeal[17].
- The
SDA then applied to the Full Court of the Federal Court for judicial review of
the decisions of both Bull DP and the Full
Bench[18]. The
Full Court, by majority, upheld the SDA's contentions and issued the writs of
certiorari and prohibition sought by the
SDA[19].
- ALDI
was granted special leave to appeal to this Court against the decision of the
Full Court[20].
- The
Commission, the second respondent to the current appeal, filed submitting
appearances both in this Court and in the Full
Court[21].
- The
reasons of the Full Bench and the Full Court reveal different approaches to the
construction of material provisions of the Act in relation to the coverage
issue. The difference in approach reflects a difference in focus in relation to
the provisions of the
Act. In the reasons of the Full Bench, the focus was
principally upon s 172 of the Act, whereas in the Full Court the focus was
upon the perceived difficulty posed by the requirement of s 186(2)(a) for
the Agreement to have been "genuinely agreed to by the employees covered by the
agreement" when no employees were, at that time,
actually working under the
Agreement.
- The
material provisions of the Act must be understood, if possible, as parts of a
coherent
whole[22].
Such an understanding is not only possible but compelling. In the interests of
clarity of analysis and coherence in exposition,
it is desirable to set out that
understanding before turning to discuss further the competing views of the Full
Bench and the Full
Court.
The Act
- The
Act contains several mechanisms for regulating employees' entitlements to wages,
leave and other benefits. Two such mechanisms are modern
awards and enterprise
agreements. Where there is an enterprise agreement in place which applies to an
employee, a modern award does
not
apply[23].
- Part 2-4
of the Act deals with enterprise agreements. One stated object of Pt 2-4
is to "provide a simple, flexible and fair framework that enables collective
bargaining in good faith, particularly at the enterprise
level, for enterprise
agreements that deliver productivity
benefits"[24].
The term "enterprise" is defined in s 12 of the Act to mean "a business,
activity, project or undertaking".
- The
provisions of Pt 2-4 that are material for present purposes deal with the
following topics: the availability of a greenfields agreement; the rights of
employees to be represented by a bargaining representative for a proposed
enterprise agreement; the making of an enterprise agreement;
the approval of an
enterprise agreement by the Commission; and the requirements for approval by the
Commission, such as the need
for genuine agreement by employees and for the
agreement to pass the BOOT. The provisions of the Act in relation to each of
these topics may now be noted.
The availability of a greenfields
agreement
- An
enterprise agreement may be either a single-enterprise agreement or a
multi-enterprise
agreement[25].
Section 172 stands at the forefront of Pt 2-4: it is the only section
in Div 2 of Pt 2-4, which is the first substantive Division of that
Part. Section 172 provides for the circumstances in which an enterprise
agreement may be made. It deals with both single-enterprise agreements and
multi-enterprise agreements. We are here concerned only with single-enterprise
agreements. In particular, we are concerned with
whether the Agreement is a
"greenfields agreement". Whether an enterprise agreement is a greenfields
agreement or not affects the
operation of many provisions of Pt 2-4 of the
Act. In particular, as will be seen, s 186(2)(a) operates only in respect
of an agreement that is not a greenfields agreement.
- Whether
or not an enterprise agreement is a greenfields agreement depends upon the terms
of s 172, which fix upon the circumstances of its making. Section 172
provides relevantly as follows:
"(2) An employer, or 2 or more
employers that are single interest employers, may make an enterprise agreement
(a single-enterprise agreement):
(a) with the employees who are employed at the time the agreement is made and
who will be covered by the agreement; or
(b) with one or more relevant employee organisations if:
(i) the agreement relates to a genuine new enterprise that the employer or
employers are establishing or propose to establish;
and
(ii) the employer or employers have not employed any of the persons who will
be necessary for the normal conduct of that enterprise
and will be covered by
the agreement.
Note: The expression genuine new enterprise includes a
genuine new business, activity, project or undertaking (see the definition
of
enterprise in section 12).
...
Greenfields agreements
(4) A single-enterprise agreement made as referred to in paragraph (2)(b)
... is a greenfields agreement.
...
(6) An enterprise agreement cannot be made with a single employee."
- It
can readily be seen that s 172 does not contemplate that an enterprise
agreement is a greenfields agreement simply because it relates to a new
enterprise. Moreover,
s 172 does not require that an enterprise agreement
related to a new enterprise be made as a greenfields agreement.
Section 172 divides the universe of single-enterprise agreements into two
categories. Of these two categories, only the second, which comprises
those
agreements made as referred to in sub-s (2)(b) of s 172, encompasses
greenfields agreements, as sub-s (4) makes plain.
- The
remaining category of enterprise agreements consists of those that are not
greenfields agreements: they are made as referred
to in s 172(2)(a). Such
agreements are those made in circumstances where the employer already employs
employees who are not then, but will be, covered
by the enterprise agreement
then in contemplation. Section 172(2)(a) and (b)(ii) expressly contemplate
that employees "will be covered" by the proposed agreement, even though the
employees are also
currently employed under another enterprise conducted by the
employer under another agreement.
- It
is necessarily implicit in s 172(2)(b)(ii) that an employer engaged in
establishing a new enterprise may have in its employ at that time persons who
will be necessary for the
conduct of the new enterprise. Because such an
enterprise is one that, as s 172(2)(b)(i) provides, is to be established at
some future time, the word "employed" in s 172(2)(b)(ii) should not be
taken to mean "employed in that new enterprise", as the SDA argued: the
new enterprise, ex hypothesi, does not yet exist. Rather, "employed"
simply means "employed" by that employer.
An enterprise agreement cannot be
made as a greenfields agreement with persons who are already employees of the
employer because
s 172(2)(b)(ii) allows such an agreement to be made only
where none of the persons who will be necessary for the normal conduct of the
new enterprise
have been employed. Such an agreement, with persons currently
employed, must necessarily be made under s 172(2)(a) of the Act.
- At
this point, reference should be made to provisions of Pt 2-1 of the Act,
which make general provision for the coverage and application of an enterprise
agreement. It is evident from these provisions of
the Act that an enterprise
agreement may "cover" an employee even though it does not yet "apply" to that
employee in the sense of imposing
obligations on the employee and the employer.
An enterprise agreement imposes obligations on employees and employers covered
by
it only when it applies to such persons. Section 51 of the Act provides
that an enterprise agreement does not give a person an entitlement, nor does it
impose obligations on a person, unless the
agreement "applies" to the person.
- Section 52
of the Act deals with when an agreement "applies" to an employee. Importantly,
ss 52 and 53 expressly indicate that an enterprise agreement may
cover an employee when it is not in operation, but it can only
apply to an employee when it is in operation.
- Section 52(1)
sets out when an enterprise agreement applies to an employee, employer or
employee organisation. It provides:
"An enterprise agreement
applies to an employee, employer or employee organisation if:
(a) the agreement is in operation; and
(b) the agreement covers the employee, employer or organisation; and
(c) no other provision of this Act provides, or has the effect, that the
agreement does not apply to the employee, employer or organisation."
- Section 53(1)
provides that "[a]n enterprise agreement covers an employee or
employer if the agreement is expressed to cover (however described) the employee
or the employer."
- Section 53(6)
provides:
"A reference in this Act to an enterprise agreement
covering an employee is a reference to the agreement covering the employee in
relation to particular employment."
- Because
an employee may be covered by more than one agreement at one time, s 58(1)
of the Act provides that only one enterprise agreement can apply to an
employee at a particular time. That is because only one set of rights and
obligations can be in operation in relation to the
work actually performed by
the employee at that time in relation to particular employment. Given the terms
of ss 52 and 53, it is apparent that an employee may be covered by an
agreement that applies to him or her, and by an agreement that does not, at
that
time, apply to him or her. Furthermore, an employee may be covered by more than
one agreement at any one time. To speak of
an employee being covered by an
agreement is to speak of the agreement providing terms and conditions for the
job performed by, or
to be performed by, the employee.
- In
this context, the natural meaning of the reference in s 53(6) to
"particular employment" of an employee is to the description of the employee's
job in the agreement. In this regard, the terms
of cl 5 of the Agreement
refer to the job descriptions of employees whose employment the Agreement will
regulate when it comes into
operation. It is a natural and ordinary use of
language to speak of the Agreement as covering these employees.
- That
an employee may be covered by the terms of more than one agreement at any one
time was recognised in Construction, Forestry, Mining and Energy Union v John
Holland Pty
Ltd[26]
("John Holland"). That the Act allows that to occur is hardly
surprising: that very possibility was expressly contemplated in the Explanatory
Memorandum which
accompanied the Bill for the
Act[27].
- Section 54(1)
provides:
"An enterprise agreement approved by the [Commission]
operates from:
(a) 7 days after the agreement is approved; or
(b) if a later day is specified in the agreement – that later
day."
- An
enterprise agreement comes into operation in the sense of creating rights and
obligations between an employer and employees in
relation to the work performed
under it only after it has been approved by the Commission. After that time the
agreement applies
to the employers and employees who are covered by it. But
before that time, as will be seen, by virtue of s 182(1) of the Act, a
non-greenfields enterprise agreement is "made" when a majority of those
employees who will be covered by the agreement cast a
valid vote to approve the
agreement. As will be seen, once the agreement is made in accordance with
s 182(1), the agreement is treated by the Act as covering the employers and
employees to whom it refers.
Rights to be represented
- Where
an agreement is not made under s 172(2)(b) of the Act, the employees, being
the employees referred to in sub-s (2)(a), are entitled to representation
under s 173.
- Section 173(1)
of the Act requires an employer that will be covered by a proposed enterprise
agreement that is not a greenfields agreement to take all reasonable
steps to
give notice of the right to be represented by a bargaining representative to
each employee who:
"(a) will be covered by the agreement; and
(b) is employed at the notification time for the
agreement."
- Section 176
sets out the persons who are the bargaining representatives for a proposed
enterprise agreement that is not a greenfields agreement.
Employee
organisations, such as the SDA, are the default bargaining representatives for
these
employees[28].
- These
provisions serve to ensure that the employees referred to in s 172(2)(a)
are able to call upon the negotiating skills and bargaining strength of employee
organisations should they so choose in order to
minimise the inequalities of
bargaining power that might otherwise adversely affect the outcome of their
negotiations with their
employer.
Making an enterprise
agreement
- Under
s 180(2)(a) of the Act, the employer must take all reasonable steps to
ensure that "the employees ... employed at the time who will be covered by the
agreement"
are given a copy of the agreement and certain other material.
- By
s 181(1) of the Act:
"An employer that will be covered by a
proposed enterprise agreement may request the employees employed at the time who
will be covered
by the agreement to approve the agreement by voting for it."
- As
to when a single-enterprise agreement is made, s 182 of the Act provides
relevantly:
"(1) If the employees of the employer ... that will be
covered by a proposed single-enterprise agreement that is not a greenfields
agreement have been asked to approve the agreement under subsection 181(1),
the agreement is made when a majority of those employees
who cast a valid vote approve the agreement.
...
(3) A greenfields agreement is made when it has been signed
by each employer and each relevant employee organisation that the agreement is
expressed to cover ...
(4) If:
(a) a proposed single-enterprise agreement is a greenfields agreement that has
not been made under subsection (3); and
...
(e) the relevant employer or employers apply to the [Commission] for approval
of the agreement;
the agreement is taken to have been made:
(f) by the relevant employer or employers with each of the employee
organisations that were bargaining representatives for the agreement;
and
(g) when the application is made to the [Commission] for approval of the
agreement."
- It
can be seen that an agreement that is not a greenfields agreement, ie one that
has not been made under s 172(2)(b), is made upon approval by the employees
who will be covered by the agreement. When it is made, those employees are
accurately described
as being covered by it, even though it does not yet apply
to them in the sense of being in operation so as to create rights and
liabilities
in relation to work actually performed under it. It covers them in
the sense contemplated by s 53 of the Act because it is expressed to cover
the jobs described as being within its scope; it is the charter of rights and
duties for those who
actually enter into employment under its terms.
- Under
s 185(1), if an enterprise agreement is made, a bargaining representative
for the agreement, whether for the employer or employees, must apply
to the
Commission for approval of the agreement.
Approval by the
Commission
- At
the time that approval is sought from the Commission, the agreement will have
already been made, in the case of a non-greenfields
agreement, by the employees
who made it under s 182(1) of the Act.
- Section 186(1)
of the Act requires the Commission, on an application for approval of an
enterprise agreement under s 182(4) or s 185, to approve the agreement
"if the requirements set out in this section and section 187 are met."
- Under
s 186(2), the Commission must be satisfied relevantly that:
"(a) if the agreement is not a greenfields agreement – the agreement has
been genuinely agreed to by the employees covered
by the agreement; and
...
(d) the agreement passes the better off overall test."
- One
may note that s 186(2)(a) is necessarily speaking of an enterprise
agreement that is made, not as referred to in sub-s (2)(b) of s 172,
but as referred to in sub-s (2)(a) of s 172.
- Section 186(2)(a)
requires, in respect of a non-greenfields enterprise agreement, that the
Commission be satisfied that the agreement has been genuinely
agreed to by the
employees "covered by" the agreement. Such an agreement is, as has been seen
from s 182(1), an agreement that has been made. The Full Bench in this
case was correct when it
said[29]:
"In
our view the concepts of 'coverage' and 'application' in ss 52 and 53 of
the Act provide the key to the interpretation of the phrase 'who will be covered
by the agreement' in s 172(2)(a) and s 182(1). An enterprise
agreement covers an employee if it is expressed to cover the employee. An
enterprise agreement applies to an employee
in relation to particular employment
if the agreement covers them and the agreement is in operation."
- The
Full Bench was also correct when it went on to say that, in determining whether,
for the purposes of s 186(2), the employees "will be covered by the
agreement after it is made", "[a]pplication of the agreement is not
relevant."[30]
- Section 186(3)
provides, in relation to both greenfields agreements and non-greenfields
agreements, that the Commission must be satisfied that the
group of employees
"covered by" the agreement was fairly chosen. In this regard, s 186(3A)
relevantly provides:
"If the agreement does not cover all of the
employees of the employer ... covered by the agreement, the [Commission] must,
in deciding
whether the group of employees covered was fairly chosen, take into
account whether the group is geographically, operationally or
organisationally
distinct."
- Section 188
of the Act states the circumstances in which the Commission may be satisfied
that an enterprise agreement "has been genuinely agreed to by the
employees
covered by the agreement".
- Section 187(5)
contains an additional requirement in respect of a greenfields agreement. It is
the only provision of Pt 2-4 which does not neatly accommodate the view
that an agreement covers employees when it is made, so that they are then
employees who
are covered rather than employees who will be covered. It
provides:
"If the agreement is a greenfields agreement, the
[Commission] must be satisfied that:
(a) the relevant employee organisations that will be covered by the agreement
are (taken as a group) entitled to represent the industrial
interests of a
majority of the employees who will be covered by the agreement, in relation to
work to be performed under the agreement;
and
(b) it is in the public interest to approve the agreement."
- Section 187(5)
is not a sufficient warrant to disregard the scheme otherwise followed in
Pt 2-4. It is evident that Parliament did not draw a significant
distinction by the change of tense from "covered" to "will be covered"
in
s 187(5). It may be noted here that s 187 is expressed to set out
"additional requirements" for the approval of agreements to the "general
requirements" contained in s 186. In this regard, s 186, which also
applies to greenfields agreements, uses the present tense in sub-ss (2)(a),
(2)(b)(i), (3), (3A) and (6)(a) notwithstanding
that the agreement is yet to be
approved by the Commission. Parties to a greenfields agreement, too, are
covered by an agreement
when it is made and before it is approved, as is
apparent from sub-ss (3) and (4)(g) of s 182.
The
BOOT
- Section 193(1)
of the Act explains when a non-greenfields agreement passes the BOOT for the
purposes of s 186(2)(d). It provides:
"An enterprise
agreement that is not a greenfields agreement passes the better off
overall test under this section if the [Commission] is satisfied, as at
the test time, that each award covered employee, and each prospective award
covered employee, for the agreement would be better off overall if the agreement
applied to the employee than if the relevant modern
award applied to the
employee."
- Section 193(6)
provides that the "test time" is the time "the application for approval of the
agreement by the [Commission] was made under subsection 182(4) or
section 185."
The Full Bench
Coverage
- The
Full Bench concluded that:
"employees who accepted on-going
employment in the Regency Park Region were employed by ALDI at the time the
agreement was made.
Further, as their employment comprehended work within the
scope of the Regency Park Agreement they were covered by the Agreement.
...
The resultant agreement was made under s 182(1). It was a single
enterprise agreement available to be made under s 172(2)(a). The Agreement
has been genuinely agreed to by the employees covered by the
Agreement."[31]
- The
Full Bench noted that, in Cimeco Pty Ltd v Construction, Forestry, Mining and
Energy Union
("Cimeco")[32],
a Full Bench of the Commission had proceeded on the basis that the expression
"will be covered" in s 182(1) of the Act referred to those employees:
"actually falling within the coverage clause [in the agreement
being put to the vote] as opposed to those it was anticipated would
be covered
by the agreement on the basis that they had been 'mobilised' to perform work in
the region covered by the agreement.
...
[T]he expression 'will be covered by the agreement' in s 182(1) does not
indicate future likelihood but rather expresses a determinate or necessary
consequence."
- In
the present case, the Full Bench declined to follow Cimeco in relation to
s 172(2)(a)[33].
Rather, in order to give a consistent meaning to common phrases in the Act, it
followed the suggestion of the Full Court of the Federal Court in John
Holland[34]
that the phrase "the group of employees covered by the agreement" in
s 186(3) meant "the whole class of employees to whom the agreement might in
the future
apply"[35].
The Full Bench held that the question before it entailed two elements: first, a
determination whether the persons are employees;
and secondly, a determination
whether the employees will be covered by the agreement after it is made. It was
held that whether
or not the agreement applied was not relevant to the
resolution of the question before
it[36].
The
BOOT
- The
Full Bench received new evidence from the SDA in relation to whether the BOOT
was passed. This new evidence included reference
to the work rosters of
employees who voted to approve the Agreement, and a comparison of their wages
under the award and the
Agreement[37].
The comparisons were between the entitlements of 10 of the 17 relevant
employees who had signed the Agreement and those employees'
entitlements under
the General Retail Industry Award 2010 ("the GRIA"), the relevant modern
award for the purposes of s 193(1) of the Act. The SDA's contention based
on the new evidence was that 40 per cent of employees would receive
less by way of remuneration under
the Agreement than they would receive under
the GRIA[38].
- In
response, ALDI argued that the BOOT was satisfied because the Agreement
contained the following provision as part of cl 13 ("the
comparison
clause")[39]:
"The remuneration paid for each classification has been set to
ensure employees are better off overall under this Agreement than under
the
relevant Modern Award which would otherwise apply. Where an Employee considers
they are not better off overall under this Agreement
than under the relevant
Modern Award, they may request a comparison of the benefits received for a
nominated period of time under
this Agreement and the benefits which would
otherwise be provided under the relevant Modern Award. Any shortfall in total
remuneration
which would otherwise be payable under the Modern Award will be
paid to the Employee in the next pay period after the review is completed.
If
the Employee and ALDI cannot reach agreement on the remuneration which should be
paid, the Resolution of Disputes provision of
this Agreement will be followed
and the parties will agree to the Fair Work Commission arbitrating and making a
binding determination
to resolve the matter."
- The
Full Bench
concluded[40]:
"This
clause creates an enforceable right to payments to employees equal to or higher
than those contained in the award. There is
no limitation on its availability.
... In our view the Deputy President properly considered the BOOT and reached a
decision based
on a sound analysis. It has not been demonstrated that there is
any appealable error in the decision under appeal. We dismiss this
ground of
appeal."
- The
Full Bench said no more in relation to its decision upon the BOOT
issue.
The Full Court of the Federal Court
- On
the SDA's application for judicial review, the Full Court, by majority (Katzmann
and White JJ, Jessup J dissenting), held that
the Full Bench's
decision was vitiated by jurisdictional error, and issued the writs of
certiorari and prohibition sought by the
SDA[41].
- The
majority upheld the SDA's argument that the Agreement could not be approved by
the Commission under s 186(2)(a) because it had not been agreed to by the
employees "covered by the agreement" as the Agreement was not then in
operation[42].
- The
majority of the Court also upheld the SDA's argument that the Full Bench
misapplied the provisions of the Act in being satisfied that the Agreement
passed the BOOT for the purposes of s 186(2)(d), without resolving the
issue raised by the new evidence, by relying on the comparison
clause[43].
Coverage
- White J,
with whom Katzmann J relevantly agreed, accepted the SDA's submission that
it was necessary to focus upon the "change in
terminology" used in ss 186
and 188 compared with that used in ss 172 to
181[44]. It
was said that the use of the present tense "covered by" in s 186 and the
fact that the Commission is obliged to consider whether employees have genuinely
agreed to the enterprise agreement, in contrast
to the use of the prospective
terminology "employees who will be covered by" in ss 172 to 181, indicates
"a requirement that there be at least some employees actually (and not
prospectively) covered by the enterprise agreement
at the time it is
made."[45]
- White J
held that s 186(2)(a) of the Act requires that there be persons covered by
the agreement whose genuineness in agreeing to it can be assessed by the
Commission and
that "[p]ersons who will become covered by the agreement only at
some time in the future do not answer that description, even if
they did, by
some means, vote to approve
it."[46]
His Honour concluded that "there were no employees actually 'covered by'
the Regency Park Agreement at the time it was made, at
the time of the
application to the [Commission], or at the time the agreement was
approved"[47].
White J reached these conclusions because:
"at the relevant
times, there were no employees actually in [the positions referred to in
cl 5 of the Agreement]. The 17 employees
were then occupying other
positions in other enterprises which were within the coverage of other
enterprise
agreements."[48]
- White J
considered that the Full Bench erred in applying the reasoning in John
Holland in construing
s 186(2)(a)[49].
His Honour held that "neither Bull DP nor the Full Bench undertook the
task required by s 186(2)(a) in the way it required." On that basis, it
was held that the Full Bench had exceeded its jurisdiction in proceeding on an
erroneous
view to the
contrary[50].
- White J
was influenced in reaching his conclusion by the consideration that it would be
"very difficult, if not impossible", for
the Commission to be satisfied that:
"the employees 'covered by the agreement' have genuinely agreed to
it ... if the employees in question are the whole class of employees
to whom the
agreement might apply in the future. It is not readily to be expected that the
Parliament intended that the [Commission]
had to be satisfied that all employees
who might during the life of an enterprise agreement become covered by it had
genuinely agreed
to
it."[51]
The BOOT
- The
majority of the Full Court noted that s 193(1) requires the Commission to
be satisfied that each award employee would be "better off overall" under the
Agreement, and not just
"no worse
off"[52]. The
majority held that the Full Bench was required to assess the detriments alleged
by the SDA[53].
- White J
observed that the Full Bench characterised the comparison clause as creating an
enforceable right to payments equal to or
higher than those contained in the
award, without explaining how that could be so. White J pointed out that
the comparison clause,
at best, created an enforceable entitlement to the
shortfall between the employee's entitlement under the Agreement and the
employee's corresponding entitlement under the GRIA – it did
not create an
entitlement to payment under the Agreement which was
superior[54].
An entitlement to a payment which was no more than equal to the award
entitlement could not, by definition, satisfy the statutory condition contained
in
s 193(1)[55].
- White J
also held that the Full Bench misunderstood its function in concluding that the
SDA had not demonstrated any "appealable
error" in Bull DP's
decision[56].
His Honour held that once it had received the further evidence, the exercise of
its appellate function was not constrained by the
need to identify error by
Bull DP – instead, it was required to reach its own decision on the
evidence before
it[57]. It was
held that by misunderstanding its task in this way, the Full Bench did not
exercise its jurisdiction as required by
law[58].
The coverage issue
- In
this Court, the SDA argued that the proposed enterprise agreement was, in truth,
a greenfields agreement because the employees
who were already working for ALDI
in other regions were not relevantly "employed" for the purposes of
s 172(2)(a) as they were not actually doing the work under the proposed
agreement. In its insistence that it is impossible to be "covered" by
an
agreement under which work has not yet actually begun, this argument amounts to
a contention that "coverage" and "application"
are synonymous, and that one can
disregard the distinction deliberately drawn by ss 52 and 53 between the
two terms.
- The
SDA's argument, and the reasoning of the majority of the Full Court, cannot
accommodate the distinction expressly drawn by ss 52 and 53 of the Act
between coverage and application.
- In
the course of argument in this Court it was suggested on behalf of the SDA that
s 53(6) of the Act, in speaking of "the agreement covering the employee in
relation to particular employment", is speaking exclusively of a case where
the
employee is actually performing work under the agreement at that time. That
understanding of s 53(6) requires one to read into the provision words that
are not there. Read without the SDA's proposed gloss, it is apparent that the
provision is simply referring to the employee's job as described in the
agreement rather than to the actual performance by the employee
of the tasks
involved in that job. This understanding accords with the Explanatory
Memorandum for the Bill, which treats "particular
employment" as synonymous with
a
"job"[59].
- The
SDA's argument, and the reasoning of the majority of the Full Court, cannot
stand with the plain and ordinary meaning of s 172(2) and (4) of the Act.
Those provisions, as mentioned, contemplate the making of non-greenfields
agreements with persons already employed. In addition,
while s 186
operates on the assumption that there are employees covered by the agreement at
the time the application for approval is made, it
does not follow that the
agreement must apply to them in the sense of operating to fix their rights and
obligations in the work actually
being performed by them at that time.
- The
question of coverage that arises when the Commission asks whether the agreement
has been genuinely agreed to for the purposes
of s 186(2)(a) is not whether
the employees voting for the agreement are actually employed under its terms,
but rather whether the agreement covers
all employees who may in future have the
terms and conditions of their jobs regulated by it. At the stage of considering
whether
an enterprise agreement is available to be made under s 172 of the
Act, ie when no agreement has as yet been made, it is a natural and ordinary use
of language to speak of the employees whose jobs are
within the scope of the
proposed agreement as employees who "will be covered" by the agreement. At the
stage of considering whether
an enterprise agreement, which has been made (by
virtue of s 182(1)), should be approved pursuant to s 186(2)(a), it is
a natural and ordinary use of language to speak of the employees, whose jobs are
described by the terms of the agreement which
has been made, as employees who
"are covered" by the agreement.
- The
Full Court erred in acceding to the SDA's invitation to give the change in tense
between ss 172 to 181 and ss 186 and 188 an effect which overrides the
distinctions drawn by s 172 and ss 52 and 53 of the Act. The change
in tense is of no greater significance than to recognise that an agreement is
not capable of covering an employee in
any meaningful sense until it has been
made. A coverage clause in an enterprise agreement may expressly provide that
it covers every
job description that may, at some time, be necessary to the work
regulated by it, but the agreement is not available as a charter
of the terms
and obligations apt to effect that regulation until it has been
made[60]. That
this is so should hardly be surprising. An enterprise agreement when made has
the same effect, so far as coverage is concerned,
as a modern award, which, when
made, affords those who thereafter accept employment under its terms a charter
of their rights and
duties in that
employment[61].
- It
is noteworthy that s 207(1)(a) of the Act provides for the variation of an
enterprise agreement by the employer and:
"(i) the employees
employed at the time who are covered by the agreement; and
(ii) the employees employed at the time who will be covered by the agreement if
the variation is approved by the [Commission]".
- Section 207(4)
provides:
"Subsection (1) applies to a greenfields agreement
only if one or more of the persons who will be necessary for the normal conduct
of the enterprise concerned and are covered by the agreement have been
employed."
- The
provision made by s 207(4) utilises the present perfect tense "have been"
to reflect the circumstance that greenfields agreements may only be made where
no
employees were employed at the time the agreement was made. Further, the
collocation of the future tense "will be necessary" with
the present tense "are
covered" makes it clear that the idea of coverage does not require an employee
to be actually working under
the terms of the agreement at the time he or she is
said to be covered. In addition, the need to condition the expression "are
covered"
with the qualifying words "have been employed" confirms that the
coverage of an agreement is wider than existing employees. That
a greenfields
agreement could have been made covering the Regency Park operations with persons
who were not then employed by ALDI
is beside the point, as noted by the Full
Bench[62].
That is because the Agreement was made, as the Act allows, as a non-greenfields
agreement.
- In
light of the ordinary and natural meaning of the terms of Pt 2-4 of the
Act, a non-greenfields enterprise agreement can be made with two or more
employees, so long as they are the only employees employed at
the time of the
vote who are to be covered by the agreement. It does not matter that the
agreement may, in due course, come to apply
to many more employees. That
understanding is consistent with the approach of the Full Court in John
Holland[63].
- In
John Holland, the expression "the group of employees covered by the
agreement" in s 186(3) was held to relate to the "whole class of employees
to whom the agreement might in the future
apply"[64]. As
was said in John Holland, the expression "covered by" in
s 186(3) extends to any person who will, in the future, be engaged as an
employee to whom the agreement will apply. To the extent that a
different view
was taken in Cimeco, it should not be followed. Consistently with the
view of s 186(3) taken in John Holland, the references in
sub-s (2) to "covered by" may be read as "those persons currently employed
who fall within the whole class of
employees to whom the agreement might in
future apply". That was the approach which found favour with the Full
Bench[65].
That approach is correct. It recognises that s 186(2), unlike
s 186(3), is concerned exclusively with agreements that are not greenfields
agreements. The employees covered by agreements that are not
greenfields
agreements presented to the Commission for approval are necessarily those
employees with whom the agreements have been
made under s 182(1).
- The
conclusion indicated by the ordinary and natural meaning of these provisions of
the Act is not brought into question by the concern, identified by White J,
that there is something implausible in the legislature accepting
that a small
group of employees may be able to fix the terms and conditions of employment for
all the employees who may be employed
in the enterprise in the future. That
concern was adverted to and rejected in John
Holland[66].
It is a concern that does not warrant the adoption of an understanding of the
Act that is contrary to the ordinary and natural meaning of its text. Indeed,
the concern is addressed, and largely allayed, by the
protective provisions of
the Act relating to the right to representation, the "fairly chosen" provisions
of sub-ss (3) and (3A) of s 186, and, most importantly, the need to pass
the BOOT.
- On
the approach of the majority of the Full Court, the concern that a decision
affecting only a few in the present may bind many
in the future is one that is
only to be remedied in the case of new enterprises, notwithstanding that it may
equally arise in relation
to already existing ones.
- On
any construction, s 172(2)(a) may be used to make an enterprise agreement
with two or more employees for an already existing enterprise. In the case of a
small
but already existing enterprise, it is uncontroversial that the votes of a
few original employees may eventually bind a much larger
group as the enterprise
grows. The construction of the majority of the Full Court does nothing to
remove that possibility, nor could
it.
- Yet,
in relation to new enterprises, the approach of the majority of the Full Court
treats that possibility as unacceptable. Rather
than countenance the
possibility, expressly contemplated by s 172(2)(a), that a few original
employees may make an agreement in relation to a proposed new enterprise that
will later bind a larger group,
the majority of the Full Court ignored the
language of s 172 and adopted a strained construction of s 186(2)(a).
That strained construction had the effect of denying those employees the
capacity to make an agreement capable of receiving approval.
Presumably it was
because of the involvement of employee organisations in the making of
greenfields agreements that the majority
of the Full Court saw its concern as
remedied by that construction. However, given that employees involved in making
a non-greenfields
agreement might, if they wished, appoint an employee
organisation as a bargaining representative, and given the additional
protections
of sub-ss (3) and (3A) of s 186, and the need to pass the
BOOT, no good reason, in terms of the purpose of the Act, justifies that
strained construction.
Should special leave be revoked?
- In
the course of argument, it was submitted on behalf of the SDA that ALDI's grant
of special leave should be revoked because ALDI's
argument in relation to the
coverage issue had altered in a material respect. In this regard, the SDA
argued that before the Full
Court, ALDI conceded that there were no employees
"covered by" the Agreement at the time it was
made[67] even
though the Full Bench had concluded that the employees who voted in favour of
the Agreement were "covered by" it because "their
employment comprehended work
within the scope of the ...
Agreement"[68].
- It
may well be that ALDI's concession should fairly be understood as having been
predicated upon the SDA's contention as to the construction
of "coverage" being
correct. If it was, then the concession was no more than that, since the
employees in question had not yet commenced
work at the Regency Park
undertaking, they were not yet covered by the
Agreement[69].
- Whatever
the effect of the concession, however, it is clear that ALDI at no stage
abandoned its reliance upon s 172 of the Act. The error in the Full Court
stemmed principally from a failure to come to grips with the terms of
s 172. In addition, the coverage issue is a matter of public importance
which should not be allowed to stand wrongly decided merely because
of an
ill-advised and plainly erroneous concession upon a matter of law by a party to
the
proceeding[70].
Accordingly, the SDA's application for the revocation of the grant of special
leave should be refused.
The BOOT
- ALDI
submitted that the new evidence adduced by the SDA before the Full Bench could
not be accorded much, if any, weight, as that
evidence did not reflect the hours
to be worked by employees under the Agreement, important components of the
payments of employees
were omitted, and employees were classified for the
purposes of the comparison at substantially higher classifications than
employees
doing the same work under a substantially similar agreement that had
recently been approved with the support of the SDA. ALDI submitted
that it is
apparent from the reasons of the Full Bench that it did not find the new
evidence persuasive and acted upon that view.
- The
SDA submitted that the BOOT "requires an overall assessment to be made", which
in turn "requires the identification of terms
which are more beneficial for an
employee, terms which are less beneficial and an overall assessment of whether
an employee would
be better off under the
agreement"[71].
What is involved is a comparison between terms and conditions under the
agreement and the terms and conditions under the modern
award[72].
That submission must be accepted.
- The
majority of the Full Court was correct to identify jurisdictional error in the
conclusion of the Full Bench that the Agreement
passed the BOOT because the
comparison clause "creates an enforceable right to payments to employees equal
to or higher than those
contained in the
award"[73].
The BOOT expressly requires that the employees be "better off" under the
Agreement compared to the award; it may be contrasted
with the
"no disadvantage" test which was the legislative predecessor of the
BOOT[74]. The
comparison clause was apt only to ensure that an employee could make a request
for payments to be equalised as between the
Agreement and an award. The right
to equalisation, after a process initiated by the employee, does not of itself
leave the employee
better off under the Agreement at the test time.
- The
paragraphs excerpted above from the reasons of the Full Bench in relation to the
BOOT issue are all that was said upon this issue
by the Full Bench. There is
nothing in the reasons of the Full Bench to suggest that, irrespective of the
comparison clause, the
employees were found to be better off under the
Agreement, such that it could possibly be said that the Agreement as a whole
secures
employees payments "equal to or higher than those contained in the
award"[75].
- Before
the Full Court, there was a difference between the parties as to whether the
Full Bench had actually exercised its power under
s 607(2)(a) of the Act to
receive the new evidence adduced by the SDA. As to this, White J
noted[76] that
the Full Bench at par [3] of its reasons seemed to suggest that it had
granted leave to adduce the new evidence; and White J
went on to conclude
that the "Full Bench reached its decision on the basis that all the further
evidence had been received." In
this Court, there was no challenge to this
conclusion of White J. It may be taken to be the case that the new
evidence was received
by the Full Bench. And so it may be said that, although
the new evidence was received by the Full Bench, the factual issues which
it
raised were not expressly resolved by the Full Bench. The majority of the Full
Court was correct to conclude that the Full Bench's
reasons justify "the
conclusion that the Full Bench did not address the correct
question"[77].
- On
a fair reading of the reasons of the Full Bench, it did not engage in any
comparison between the Agreement and the modern award.
Rather, it summarised
ALDI's submission upon the comparison clause, and accepted that submission as
showing that the Agreement passed
the BOOT. It may be, of course, that the new
evidence adduced by the SDA before the Full Bench can be shown to be deserving
of little
weight in the evaluative assessment required by s 193, but the
Full Bench fell into jurisdictional error in failing to determine whether or not
that was so.
- It
was also argued on behalf of ALDI that the majority of the Full Court failed to
appreciate that the comparison clause serves to
ensure that employees covered by
the Agreement will become entitled to the benefit of favourable movements in the
award after the
BOOT has been satisfied. That argument does not meet ALDI's
difficulty. No doubt, the benefit to employees of this updating provision
is
something that might properly be taken into account in assessing whether the
BOOT is satisfied at the test time. But to say this
does not answer the point
that the Full Bench's reasons do not show how the BOOT is satisfied at the test
time given that the comparison
clause assures employees of no more than that
they may take steps in the future with a view to ensuring that they are not
worse off
than under the award.
- In
any event, by failing to carry out the evaluative assessment required to resolve
the issue raised by the new evidence received
by it, the Full Bench misconceived
its role and so fell into jurisdictional
error[78].
- Whether
the Full Bench was satisfied that an employee was better off overall under the
Agreement than under the award required an
evaluative assessment after
consideration of the provisions of the award and the Agreement that may have
been more beneficial to
employees and those that may have been less
beneficial[79].
This assessment is a matter of the kind which has been described in other
contexts as:
"a question, not of principle or of positive findings
of fact or law, but of proportion, of balance and relative emphasis, and of
weighing different considerations. It involves an individual choice or
discretion, as to which there may well be differences of
opinion by different
minds."[80]
- The
appeal to the Full Bench for which the Act provides is an appeal by way of
rehearing[81].
Section 607(2) allows the Full Bench to admit further evidence on an appeal
to it in order to determine the matter upon that rehearing. Using that
further
evidence, the Full Bench may find that the decision the subject of appeal was an
incorrect decision even though, on the evidence
before the Commission, its
decision was not demonstrably erroneous. The Full Bench was wrong to approach
its task as if it were
enough to conclude that Bull DP had "properly
considered the BOOT and reached a decision based on a sound
analysis"[82].
- The
Full Bench did not deal with the appeal to it as an appeal by way of rehearing.
On any view of what a rehearing
entails[83],
once the Full Bench admitted the new evidence which challenged the satisfaction
of the BOOT, it was incumbent on it to decide the
appeal "upon the facts and in
accordance with the law as it exists at the time of hearing the
appeal."[84]
That is because "the further evidence may demonstrate error in the outcome" even
though the primary decision was correct at the
time it was
made[85]. By
concluding that "[i]t has not been demonstrated that there is any appealable
error in the decision under appeal", because "the
Deputy President properly
considered the BOOT and reached a decision based on a sound analysis", the Full
Bench did not "hav[e] regard
to all the evidence now before the appellate
court"[86].
Conclusions and orders
- In
the result, ALDI's appeal to this Court succeeds in relation to the coverage
issue and fails in relation to the BOOT issue.
- It
was common ground between the parties that in the event that the appeal to this
Court should succeed in relation to the coverage
issue but fail in relation to
the BOOT issue, the latter issue should be remitted to the Commission to be
determined according to
law. While the parties were at one in speaking in terms
of an order to remit to the Commission the question whether the BOOT has
been
satisfied, the better course, given that the decision of the Full Bench was
affected by jurisdictional error which must be formally
corrected, is to order
that it be quashed by a writ of certiorari and that a writ of mandamus issue
requiring that the Full Bench
proceed to determine the appeal to it according to
law.
- The
appeal to this Court should be allowed in part. That part of the orders of the
Full Court of the Federal Court of Australia
dated 29 November 2016
relating to the decision of Bull DP under s 186 of the Fair Work
Act 2009 (Cth) should be set aside. A writ of certiorari should be issued
to quash the decision of the Full Bench of the Fair Work Commission,
and a writ
of mandamus should issue requiring the Full Bench of the Fair Work Commission to
determine according to law whether the
ALDI Regency Park Agreement 2015 passes
the better off overall test set out in s 193 of the Fair Work Act
2009 (Cth). That part of the first respondent's originating application to
the Full Court of the Federal Court of Australia for relief
under s 39B of
the Judiciary Act 1903 (Cth) concerned with the decision of Bull DP
under s 186 of the Fair Work Act 2009 (Cth) should be
dismissed.
- GAGELER
J. I agree with the orders proposed by the plurality and I agree with the
reasons given by the plurality for making those
orders. By way of
amplification, I add one observation concerning the "coverage issue".
- The
Full Court of the Federal Court correctly concluded in Construction,
Forestry, Mining and Energy Union v John Holland Pty
Ltd[87]
that the "group" of "employees covered by the agreement" to which s 186(3) and
(3A) refer is the whole class of employees to whom the agreement might in the
future apply. That conclusion is compelled by
the consideration that the
requirements of s 186(3) and (3A) must be met in order to approve a greenfields
agreement in the same way as those requirements must be met in order to approve
an agreement that is not a greenfields agreement.
- Given
that a greenfields agreement, as defined in s 172(4) by reference to s 172(2)(b)
and (3)(b), is an agreement made by an "employer" or "employers" who "have not
employed any of the persons who ... will be covered
by the agreement", the
reference in s 186(3) and (3A) to "employees covered by the agreement" cannot be
read as limited to employees to whom the agreement will apply immediately
on
coming into operation. The word "employees" in s 186(3) and (3A), like the
words "employer" and "employers" in s 172(2)(b) and (3)(b), is without
temporal significance. The "group" to which s 186(3) and (3A) refer is the
totality of persons who might at any time during the operation of the agreement
meet the description of employees
covered by the agreement.
- The
word "employees" in s 186(2)(a) is similarly without temporal significance. The
reference to "employees covered by the agreement" in s 186(2)(a) is
similarly not limited to employees to whom the agreement will apply immediately
on coming into operation.
- But
the employees to whom s 186(2)(a) refers cannot extend, as does the "group" in s
186(3) and (3A), to the totality of persons who might at some time in the future
meet the description of employees covered by the agreement.
To read s 186(2)(a)
as extending to the totality of those persons would give rise to a difficulty of
the kind which evidently troubled the majority of
the Full Court of the Federal
Court in the decision under
appeal[88]. To
the extent that some persons within the totality of persons who might at some
time in the future meet the description of employees
covered by the agreement
might not yet have been employed and might not yet even be known, it would be
impossible to be satisfied
at the time of approval that the agreement "has been
genuinely agreed to". The result would be that, except in the case of an
agreement
confined to covering a closed class of persons who were already
employed at the time the agreement was made, the requirement could
not be met.
- The
difficulty is overcome when it is recognised that s 186(2)(a), in contrast
to s 186(3) and (3A), sets out a requirement that needs to be met only in the
case of an agreement that is not a greenfields agreement. Read
in light of the
descriptions in s 172(2)(a) and (3)(a) of an agreement that is not a
greenfields agreement, and against the background of the procedure established
by ss 180(1) and 181(1) for the making of an agreement that is not a greenfields
agreement, the reference in s 186(2)(a) to "employees covered by the agreement"
needs to be understood as confined in its operation to a particular subclass of
employees
covered by the agreement. The subclass comprises those who were
employed at the time the agreement was made and became covered by
the agreement
as a result of it having been made.
- What
s 186(2)(a) therefore requires, in the case of an agreement that is not a
greenfields agreement, is satisfaction that the agreement has been
genuinely
agreed to by those employees who were employed at the time the agreement was
made and who became covered by the agreement
as a result of the agreement being
made. That the agreement might not apply to those employees until a time in the
future is not
to the point.
- Accordingly,
in the case of the ALDI Regency Park Agreement 2015, the employees within
the scope of s 186(2)(a) were limited to the 17 existing employees of ALDI who
at the time of making that Agreement had already contracted to work in the
Regency Park region in the future.
[1] Shop, Distributive and Allied
Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 184 [143],
190 [177].
[2] Shop, Distributive and Allied
Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 172
[76]- [77]; Transport Workers' Union of Australia v ALDI Foods Pty Ltd
(2016) 255 IR 248 at 252-253 [12].
[3] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 255 [25].
[4] Shop, Distributive and Allied
Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 172
[77]- [78].
[5] Shop, Distributive and Allied
Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 172
[78].
[6] Shop, Distributive and Allied
Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 173 [83].
[7] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 252 [8].
[8] Shop, Distributive and Allied
Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 158
[5].
[9] Shop, Distributive and Allied
Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 158
[5].
[10] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 173
[87].
[11] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 173
[84].
[12] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 252 [8].
[13] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 251 [4].
[14] ALDI Regency Park Agreement
2015 [2015] FWCA 6373 at [13].
[15] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 173
[86].
[16] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 254 [17].
[17] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 267 [60].
[18] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 157
[1].
[19] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 190
[179].
[20] [2017] HCATrans 048.
[21] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 158
[1].
[22] See Project Blue Sky Inc v
Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [69]-[71];
[1998] HCA 28.
[23] Fair Work Act 2009
(Cth), s 57.
[24] Fair Work Act 2009
(Cth), s 171(a).
[25] Fair Work Act 2009
(Cth), s 12.
[26] [2015] FCAFC 16; (2015) 228 FCR 297 at 303
[22].
[27] Australia, House of
Representatives, Fair Work Bill 2008, Explanatory Memorandum at 34 [205].
[28] Fair Work Act 2009
(Cth), s 176(1)(b).
[29] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 260 [38].
[30] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 260 [41].
[31] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 260 [42].
[32] [2012] FWAFB 2206; (2012) 219 IR 139 at 151-152
[50]- [51].
[33] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 257-260 [35]-[42].
[34] [2015] FCAFC 16; (2015) 228 FCR 297.
[35] See John Holland [2015] FCAFC 16; (2015)
228 FCR 297 at 299 [1]- [2], 306-307 [34]-[41].
[36] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 260 [41].
[37] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 266-267 [56]; Shop,
Distributive and Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016)
245 FCR 155 at 186 [155].
[38] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 186
[155].
[39] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 267 [57].
[40] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 267 [58].
[41] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 190
[179].
[42] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at
182-185 [132]- [147].
[43] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at
187-189 [163]- [174].
[44] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 182
[135]- [136].
[45] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 182
[131].
[46] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 182
[134].
[47] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 184
[143].
[48] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 184
[142].
[49] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 181
[129].
[50] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 184
[144].
[51] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 181
[128].
[52] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 186
[153].
[53] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at
188-189 [167]- [168].
[54] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 188
[166].
[55] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 188
[167].
[56] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 189
[169]- [170].
[57] See Coal and Allied
Operations Pty Ltd v Australian Industrial Relations Commission
[2000] HCA 47; (2000) 203 CLR 194 at 203-204 [14]- [15]; [2000] HCA 47.
[58] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 189
[170], [174].
[59] Australia, House of
Representatives, Fair Work Bill 2008, Explanatory Memorandum at 34 [205].
[60] Cf National Tertiary
Education Industry Union v Swinburne University of Technology [2015] FCAFC 98; (2015) 232 FCR
246.
[61] Cf Fair Work Act 2009
(Cth), s 143.
[62] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 256-257 [33].
[63] [2015] FCAFC 16; (2015) 228 FCR 297 at 299
[1]- [2], 306-307 [34]-[41].
[64] [2015] FCAFC 16; (2015) 228 FCR 297 at 299
[2].
[65] See Transport Workers' Union
of Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 260 [40]-[42].
[66] [2015] FCAFC 16; (2015) 228 FCR 297 at 306-307
[34]- [41].
[67] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 184
[143].
[68] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 260 [42].
[69] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 184
[142].
[70] Cf Port Jackson Stevedoring
Pty Ltd v Salmond & Spraggon (Aust) Pty Ltd [1978] HCA 8; (1978) 139 CLR 231 at 241;
[1978] HCA 8; Minister Administering the Crown Lands Act v NSW Aboriginal
Land Council (2008) 237 CLR 285 at 304-305 [66]; [2008] HCA 48.
[71] Re Armacell Australia Pty
Ltd [2010] FWAFB 9985; (2010) 202 IR 38 at 49 [41].
[72] Top End Consulting Pty Ltd re
Top End Consulting Enterprise Agreement 2010 [2010] FWA 6442 at [26]- [29].
[73] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 267 [58].
[74] See Workplace Relations
Act 1996 (Cth), ss 170LT, 170VPB, 170XE.
[75] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 267 [58].
[76] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 189
[171]- [172].
[77] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 189
[168].
[78] Coal and Allied Operations
Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194 at
208-209 [31].
[79] Re Armacell Australia Pty
Ltd [2010] FWAFB 9985; (2010) 202 IR 38 at 49 [41].
[80] British Fame (Owners) v
Macgregor (Owners) [1943] AC 197 at 201, cited with approval in
Podrebersek v Australian Iron & Steel Pty Ltd [1985] HCA 34; (1985) 59 ALJR 492 at
493-494; [1985] HCA 34; 59 ALR 529 at 532; [1985] HCA 34.
[81] Coal and Allied Operations
Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194 at
203-204 [13]- [14]; Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172 at 180 [23]; [2000]
HCA 40.
[82] Transport Workers' Union of
Australia v ALDI Foods Pty Ltd (2016) 255 IR 248 at 267 [58].
[83] Cf Warren v Coombes
[1979] HCA 9; (1979) 142 CLR 531 at 551; [1979] HCA 9.
[84] CDJ v VAJ (1998) 197 CLR
172 at 202 [111]; [1998] HCA 67. See also Victorian Stevedoring and General
Contracting Co Pty Ltd and Meakes v Dignan [1931] HCA 34; (1931) 46 CLR 73 at 107; [1931]
HCA 34.
[85] See Telstra Corporation Ltd
v Minister for Broadband, Communications and the Digital Economy [2008] FCAFC 7; (2008) 166
FCR 64 at 75 [41].
[86] Allesch v Maunz [2000] HCA 40; (2000)
203 CLR 172 at 180 [23].
[87] [2015] FCAFC 16; (2015) 228 FCR 297.
[88] Shop, Distributive and
Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161; (2016) 245 FCR 155 at 181
[128].