IN A recent decision, the Fair Work Commission (FWC) approved an application for approval of an enterprise agreement, despite objection from the CFMEU that the Notice of Employee Representational Rights (NERR) did not strictly comply with requirements.

AREEA welcomes this common sense decision that supports the objects of the Fair Work Act around enterprise agreement making.

Background

Following ATCO Structures & Logistics Pty Ltd’s (ATCO) lodgement of its application for approval of the ATCO Structures & Logistics Pty Ltd (Queensland) Enterprise Agreement 2017, the CFMEU requested copies of the application documents and advised that it wished to make submissions in relation to the application.

There was some uncertainty throughout the matter as to whether the CFMEU was a bargaining representative. The CFMEU was directed to file submissions on whether it should be heard, but failed to comply with the FWC’s direction.

In any case, the CFMEU advised at the hearing that it was content to confine its submission to matters concerning the validity of the NERR. Commissioner Simpson granted the CFMEU permission to be heard on that basis.

The CFMEU submitted that the NERR was non-complaint, because it included the words “Fair Work Regulations 2009 – Schedule 2.1” at the head of the notice.

According to the Fair Work Act 2009, the NERR must be in the form prescribed by the regulations. That is, the NERR as set out in Schedule 2.1 of the Fair Work Regulations 2009.

The CFMEU sought to rely on the FWC Full Bench in Peabody Moorvale v CFMEU, which highlighted the importance of strict compliance with the mandatory requirements for the form and content of the NERR.

The FWC has previously taken a rigid view of compliance, refusing many agreement approval applications where a NERR does not comply strictly with the regulatory requirements even where all other approval requirements are met.

Commission rejects union argument

Despite the CFMEU’s argument, Commissioner Simpson was satisfied the NERR was valid.

“The issue that arises does not do so from the words used in the body of the notice, as those words conform to the legislative requirements. The NERR was not issued on a letterhead or with a logo of any kind,” the Commissioner said.

“Those words appearing as a heading above the notice would not have the potential to mislead employees in relation to the proposed Agreement.

“It would appear the presence of the words has no effect in relation to the notice. It does not in any material way change the form and content prescribed by the NERR.”

The Commissioner considered the judgement of Jessup J in SDA v ALDI in which Jessup J expressed the view that it would not have been in error jurisdictionally to permit a reference to ‘leader’ instead of ‘employer’ in the NERR.

He also referred to the Full Bench decision in KCL Industries Pty Ltd in which the Full Bench described restructuring the first paragraph of the NERR into two separate sentences as being arguably a triviality which might not render the NERR invalid, although it did not make a formal finding on this point.

The Commissioner was satisfied that the inclusion of the words at the head of the document were “so trivial” as to fall within the ambit of the circumstances contemplated by Aldi and KCL Industries.

The Commissioner found the notice to be valid, and approved the agreement.

Implications for Employers

AREEA welcomes this common sense decision as one which supports the facilitation of agreement making where there has been substantial compliance with the notice requirements, and the purpose and intent of the scheme of the legislation met.

AREEA has long advocated for the strict provisions around the NERR to be relaxed, enabling members of the FWC to use their discretion in determining whether a slight variation or non-compliance has material effect on the bargaining process.

For example, where the notice has a slight and inconsequential “defect”, an agreement otherwise validly approved by employees should be permitted for approval at a Commission Member’s discretion.

This is of course in direct contrast to frustrations of an overwhelming number of employers, unions and employees alike who have faced rejection of an agreement made due to what appear to be trivial compliance issues with the NERR such as documents stapled together instead of provided separately, the form being issued just days late in the scheme of a two year bargaining process, and an employer which substituted one word for another for clarity purposes.

AREEA’s advocacy greatly assisted in getting a Bill before parliament, the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Bill 2017, which includes provisions to allow the FWC discretion in circumstances of a trivial compliance failure.

AREEA continues to encourage members to take care with enterprise agreement approval processes. This particular issue requires a careful approach at the commencement of bargaining, prior to conducting an employee vote, and at the time of applying for FWC approval.

It is strongly advised that members take guidance from an AREEA workplace relations consultant that any NERR complies with the requirements in the FW Act. Contact your local AREEA office for advice.