KEY POINTS

  • A union that acted as a bargaining representative during negotiations for a proposed agreement can seek to be covered by the agreement without providing written notice to the Commission in a particular form or notifying the employer first.

​Coverage for unions— the Fair Work Act 2009 (Cth)

Coverage can mean many things to many people. Protection, safety…insurance premiums. For unions, the coverage they are most often interested in is coverage under an enterprise agreement. If an enterprise agreement covers a union, the union will have certain entitlements that it would not otherwise have, such as the ability to enforce the terms of the agreement.

In order to be covered by an agreement, under section 183 of the Fair Work Act 2009 (Cth) (FW Act) a union that is a bargaining representative for an enterprise agreement is entitled to have the agreement cover it if it provides the Commission with a written notice that it wants the agreement to cover it before the Commission approves the agreement, with a copy of the notice also to be given to each employer covered by the agreement. If the union has provided notice to the Commission that it wants the agreement to cover it, and the Commission approves the agreement, then section 201(2) of the FW Act has the effect that the Commission must note in its approval decision that the agreement covers the relevant union.

The issue of whether a union can be covered by an agreement if it has only provided notification to the Commission, and not the employer, was considered by a Full Bench of the Commission in the decision of Groote Eylandt Mining Company Pty Ltd v Construction, Forestry, Mining and Energy Union.1 This decision also helpfully highlights the procedural rights employers may have against unions seeking coverage under their enterprise agreements.

Background

Groote Eylandt Mining Company Pty Ltd, trading as South 32 GEMCO (GEMCO), filed an application to the Commission for approval of the Groote Eylandt Mining Company Enterprise Bargaining Agreement (Agreement). The Construction, Forestry, Mining and Energy Union (CFMEU) sought a copy of the Agreement from the Commission, asserting that it was a bargaining representative in negotiations for the Agreement. The Commission contacted GEMCO and requested its views in relation to the CFMEU’s request for a copy of the Agreement and asserted bargaining representative status. GEMCO objected to the CFMEU’s request on the basis that it had not previously established that it was a bargaining representative.

In response, the CFMEU stated that it could provide the Commission with a statutory declaration as to its status as a bargaining representative. The Commission then obtained a list of members from the CFMEU and a list of employees from GEMCO, and identified that some of GEMCO’s employees were on CFMEU’s list of members during the bargaining period. The Commission advised GEMCO of its findings and that the CFMEU was in a position to forward the statutory declaration to the Commission, which was duly provided a week later.

The following day, Commissioner Gregory approved the Agreement.2 In his decision, the Commissioner stated that a number of unions, including the CFMEU, were covered by the Agreement as they had been bargaining representatives for the Agreement and had given notice to the Commission that they wanted the Agreement to cover them.

GEMCO appealed the Commissioner’s decision, arguing that under the FW Act, the CFMEU was required to give GEMCO (as the employer covered by the Agreement) a copy of the written notice stating the CFMEU wanted the Agreement to cover it before the Agreement was approved.3

The question that arose before the Full Bench in GEMCO v CFMEU was whether a union can be covered by an agreement for which they were a bargaining representative if they have notified the Commission that it wishes to be covered by an agreement before its approval, but has failed to notify the employer.

Findings

A Full Bench had previously considered this issue in the case of RotoMetrics Australia Pty Ltd v Australian Manufacturing Workers’ Union (RotoMetrics).4 This case involved similar facts to GEMCO v CFMEU. In RotoMetrics, a Full Bench found that section 183 should be read as a whole, effectively making the union’s notification to the employer a substantive requirement for unions to seek coverage under agreements.

However, the Full Bench in GEMCO v CFMEU decided to overturn the decision in RotoMetrics and dismissed GEMCO’s appeal.

The Full Bench adopted a “plain meaning” approach to interpreting the FW Act, stating that section 201(2) is already limited in its express terms to giving notice under section 183(1).5 This means that, so long as the union gave notice to the Commission that it wished to be covered by the agreement under section 183(1), then there were no apparent reasons to also require notice to be given to an employer before coverage could be granted.

Effectively, the Full Bench stated that notice to an employer of seeking coverage was not an additional requirement for unions to fulfil. Rather, the Full Bench said that notice to an employer under section 183(2) had its own separate purpose based on natural justice principles, namely by affording an employer an opportunity to object to coverage on the only substantive basis available: that the union was not a bargaining representative.6

This approach by the Full Bench means that the union’s provision of notice to the employer is characterised as a procedural requirement, the purpose of which is to provide the employer with notice that the union wishes to be covered by an enterprise agreement, prior to its approval. This gives the employer the opportunity to resist the union’s coverage on the only substantive statutory basis available; that the union was not a bargaining representative.7

The Full Bench noted that this approach does not result in an automatic process whereby an organisation giving the Commission written notice to be covered by an enterprise agreement is noted as being covered.8 The Commission first has to be satisfied that the union is a bargaining representative before it makes a note of coverage.9 If the Commission finds that the organisation is not a bargaining representative, then section 183(2) gives the employer an opportunity to be heard on this issue.

Applying these findings to the case, the Full Bench found that GEMCO had no substantive basis for further resisting the Agreement’s coverage of the CFMEU once the Commissioner had determined the issue of the union’s bargaining representative status, and therefore dismissed GEMCO’s appeal.

Bottom line for employers

The only substantive right of an employer to object to an enterprise agreement covering a union is on the basis that the union was not a bargaining representative during the bargaining period for the agreement.

Unions are required to notify employers that they wish to be covered by an enterprise agreement. However, a failure to do so does not necessarily disqualify the union from coverage under the agreement if the union has notified the Commission of its desire to be covered by it, and the Commission is satisfied that the union was a bargaining representative for the agreement.