AIRC asserts wide scope for agreement matters


AIRC asserts wide scope for agreement matters

In a significant decision the Full Bench of the AIRC has ruled in favour of a wide interpretation of the scope of matters that can legitimately be brought under federal enterprise agreements.


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In a significant decision the Full Bench of the AIRC has ruled in favour of a wide interpretation of the scope of matters that can legitimately be brought under federal enterprise agreements. 

During 2003 the debate intensified as to what matters pertain to the employment relationship  - as only these matters could legitimately be included in federal enterprise agreements under the Workplace Relations Act 1996.

Some commissioners had previously excluded union right of entry clauses and any provisions relating to contractors, but this approach has now been held to be too narrow.The Full Bench has now ruled in favour of a wide interpretation.

This appeal was partly concerned with a clause about use of labour hire casuals to be engaged on work covered by an agreement. It also related to characterisation of a clause about right of entry to workplaces for union activities.

The AIRC followed Electrolux No 2, but the High Court is yet to rule on that appeal, so this matter is still subject to some doubt.


The Full Bench concluded:

‘In this matter, we have been asked to pronounce upon the construction of section 170LI and, in effect, to depart from a considered approach established in Atlas Steels and followed in the later cases we have reviewed.

… simple reiteration by us of the construction given in Atlas Steels, in our view, is not either the most appropriate or a just response to the matter …

Atlas Steels does not proceed from a comprehensive analysis of section 170LI in either the immediate statutory context, or in perspective with the legislative genealogy of the provision and scheme of which it forms part.

… the judgment in Electrolux No. 2 about section 170ML and the reasons given for it unequivocally "bind" this Commission. That ratio decidendi and the statutory pedigree and content of the statutory framework arguably have a bearing on the discernment of a clear legislative purpose for section 170LI to be construed as intended to make certifiable an agreement looked at as a whole. No aspect of the reasoning in the Commission decisions to which we have referred gives expressed consideration to that requirement.

section 170LI is declarative of a condition precedent for the certification process, a matter of jurisdictional fact. In the decisions and judgments to which we have referred, we doubt whether the consideration of the construction of that section allowed sufficient weight to that fact.

With our punctuation, ellipses, and emphasis, the words directly to be construed are:
there must be an agreement in writing,
about matters pertaining to the relationship between:
an employer, (of the requisite kind),
and, all persons, who (etc), are employed in a single business or part of a single business, of the employer,
and whose employment is subject to the agreement.

… The proper construction of section 170LI proceeds from and around an acceptance that the reference relationship is the real one; the employment in the relevant business.

The reference relationship is not the abstract construct developed for purposes of identifying a constitutional industrial dispute or the statutory counterpart of it. Weight must be given in the construction of section 170LI to the focus of the language on agreement about matters pertaining to an actual relationship.

We consider that the Act reflects a clear policy that separates and generalises the jurisdictional requirements for certain agreements to be proposed for a certification process. That process is a separate and second stage. Division 4 of Part VIB directs the Commission in the exercise of whatever appetite it may have for term by term scrutiny of agreements proposed for certification.

Finally, we note that we consider the construction we have arrived at to be broadly consistent with the emphasis given in Electrolux No. 2 to the guiding objectives of the Act. In our view the obiter comments were intended as a soundly based warning.’

The union’s appeal was allowed.

See: Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union and others v Unilever Australia Ltd - re Appeal; refusal to certify an agreement made under Section 170LJ – FB OF AIRC - Munro and Drake SDPP and Larkin C - PR940027 (31 October 2003).









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