A Full Bench of the Fair Work Commission has quashed a decision at first instance that held an offshore resources employer's casual workforce was not eligible to vote in an enterprise agreement ballot. The Full Bench held that the workers who had been engaged, put through paid training and recorded on their employer's payroll system were entitled to vote, even though they were not working at the time of the vote.

Implications for employers

Employers should be mindful that casual employees not actually working at the time of the vote may still be entitled to vote on a proposed enterprise agreement. Employers will need to distinguish between:

  • employees who are “likely to be engaged” or who are “usually employed” by the employer, but are not in fact employed by the employer at that time - who are notentitled to vote; and
  • employees who are employed on a casual basis at the time of the vote, but who may not in fact be performing any work at the time due to their casual employment - who are entitled to vote.

Background

McDermott Australia Pty Ltd, the employer (McDermott), applied to have an enterprise agreement known as the McDermott Australia Pty Ltd Ichthys Project Offshore Construction Agreement 2016 (Agreement) approved by the Commission. The Agreement proposed to cover McDermott employees engaged to perform construction work offshore on the Inpex Ichthy Project (Project) off the coast of Western Australia.

All employees proposed to be covered by the Agreement were engaged on a casual basis, as is standard industry practice for offshore construction projects off the North West Coast of Western Australia.

McDermott’s involvement in the Project commenced in September 2014 and continued through the date of the vote with various campaigns of offshore construction work of varying durations, however no work was being conducted at the time of the vote.

The Australian Workers’ Union (AWU) and the Australian Manufacturing Workers’ Union (AMWU) both opposed the approval of the Agreement on the basis that:

  • the Commission could not be satisfied that the employees genuinely agreed to the Agreement because it could not be satisfied that a majority of employees employed at the time who cast a valid vote approved the Agreement; and
  • the application was not accompanied by a proper signed copy of the Agreement, because the employee who signed on behalf of the employees to be covered by the Agreement was not an ‘appointed’ representative of those employees.

Decision at first instance

At first instance, Commissioner Lee dismissed the application for approval of the Agreement because he could not be satisfied that the employees genuinely agreed to the Agreement. The Commissioner found that the request for employees to approve the Agreement by voting for it was made to employees who were not “employed at the time”. The Commissioner applied the decision of the Full Federal Court in National Tertiary Education Industry Union v Swinburne University of Technology (2015) FCR 246 (Swinburn), where it was held that including those who were “likely to be engaged” or who are “usually employed” as being within the expression “employees employed at the time” was a misreading of s 181(1) of the Fair Work Act. The Commissioner therefore found that the 36 casual employees who voted on the Agreement were not actually engaged in work or being paid at the time, and accordingly, were not “employed at the time” for the purposes of s 181(1).

The Commissioner did not consider the unions’ second argument with respect to the signature requirements.

Decision on appeal

A Full Bench quashed the decision at first instance and approved the Agreement, finding that the Commissioner at first instance misdirected himself by narrowly focussing on the upcoming construction campaign which had not yet commenced, rather than viewing the Project as a whole. The Full Bench highlighted the fact that all of the employees who voted on the Agreement were hired to work on the Project, had completed paid training for the Project, the Project had commenced, and none of these employees had resigned, been terminated, or indicated they were unavailable for future work.

The Full Bench distinguished the present circumstances from Swinburne, holding that Swinburne is not authority for the proposition that a casual employee is only “employed at the time” they are rostered to work and are being paid. Rather, Swinburneis authority for the proposition that “employed at the time” does not include “usually employed”.

The Full Bench held that “the status of the 36 casual employees at the time of the vote is a natural and expected phenomenon of being employed on a casual contract”. The Full Bench considered that it would be inappropriate and counter-intuitive to disenfranchise casual employees of a right to vote on an agreement that determines their wages and conditions on the basis that they were not rostered to work on the day of the vote, or during the 7 day access period, and that taking such an approach would leave the vote open to manipulation.

The Full Bench also addressed the Unions’ argument that the application was not accompanied by a properly signed copy of the Agreement, because the employee who signed on behalf of the employees to be covered by the Agreement was not an “appointed” representative of those employees. The Full Bench held that as long as the employee who signs is in a class of employees who will be bound by the Agreement, that is enough to be a “representative” of the employees to be covered, and that the Fair Work Act does not require the representative to be “appointed”.

Having dealt with and dismissed any reason as to why the Agreement should not be approved, the Full Bench approved the Agreement.

McDermott Australia Pty Ltd v The Australian Workers’ Union & the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union [2016] FWCFB 2222 (19 April 2016)