Enterprise bargaining: would you pass the test?

Cases

Enterprise bargaining: would you pass the test?

The enterprise bargaining process often encounters hurdles and obstacles. In these four cases the Fair Work Commission considers some relevant tests that need to be satisfied.

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The enterprise bargaining process often encounters hurdles and obstacles. In these four cases the Fair Work Commission considers some relevant tests that need to be satisfied.

Good faith bargaining test satisfied, but no agreement
Better off overall test satisfied
Reasonableness test – demotion justified
Significant disruption possible – status quo maintained

Good faith bargaining test satisfied, but no agreement


The issue was whether the employer had agreed to bargain. The FWC noted the employer may be inferred to have agreed to bargain through its conduct.

An agreement of an employer to bargain refers to a single event occurring at a particular time. It is not necessary for an employer to have maintained, at all times thereafter, its agreement to bargain, in order to be regarded as having agreed to bargain for the purpose of s230(2)(a). 

The requirement to issue Notice of Representational Rights (NERR) is not a prerequisite to bargaining.

In this case the FWC concluded that no enterprise agreement which may emerge would be capable of approval. An order could serve no possible purpose even if it could require a NERR to be issued.

The union’s application was dismissed.
 
Transport Workers' Union of Australia v Hunter Operations P/L [2014] FWC 7469 - Hatcher VP - 30 October 2014

Better off overall test satisfied


A full bench of the FWC heard an appeal against the approval of an enterprise agreement. It considered whether the deputy president erred in finding the agreement satisfied the better off overall test and the further finding that exceptional circumstances existed which would not be contrary to public interest.

The full bench found no appellable errors in deputy president’s reasoning or consideration. Application of the better off overall test involves exercise of discretion and degree of subjectivity or value judgement and it’s not relevant if Full Bench would have come to a different conclusion. Permission to appeal refused.

Appeal by the Transport Workers’ Union of Australia against decision of Sams DP of 23 May 2014 [[2014] FWCA 3338] Re: Jarman Ace P/L t/a Ace Buses [2014] FWCFB 7097 - Catanzariti VP Boulton J Cambridge C - 28 October 2014

Reasonableness test – demotion justified


This dispute related to a decision to discipline an employee by way of demotion. The appeal to the Federal Court followed two earlier rejections.

At first instance the FWC held the demotion was reasonable and proportionate to his misconduct. 

The full bench held that the commission balanced seriousness of misconduct against the consequences of demotion and no jurisdictional error was identified.

Appeal by Soliman against decision of Watson VP of 5 May 2014 [[2014] FWC 2176] Re: University of Technology, Sydney [2014] FWCFB 6394 - Hatcher VP Hamberger SDP Johns C - 16 September 2014 

Significant disruption possible – status quo maintained


The FWC heard a dispute relating to a proposal to change an annualised or averaged payment system that would directly impact on payment of penalties in relation to leave entitlements.

The current practice had been in place for several decades. The employer was concerned the practice was in breach of a relevant agreement, but the applicant union sought orders to mitigate the adverse effect of any changes.

The FWC noted it could not order changes unless there was an inconsistency with another agreement provision or NES.

The Commission was satisfied the most equitable resolution was to maintain the status quo in relation to annual and personal leave entitlements until or unless the agreement was replaced or varied. It determined the changes would cause significant disruption and anxiety for employees.

It concluded other proposed changes were not prevented by or inconsistent with the agreement or NES. 

The commission determined that the employer consult with the applicant union, provide notice of introduction of changes and conduct briefings with affected employees.

Australian Municipal, Administrative, Clerical and Services Union v Royal Automobile Club of Victoria (RACV) Ltd [2014] FWC 7241 - Roe C - 16 October 2014

The bottom line: Enterprise bargaining allows all parties to put forward their positions forcefully, but reasonable behaviour is expected in the process.

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