s.318 - Application for an order relating to instruments covering new employer and transferring employees

Application for an order relating to instruments covering new employer and transferring employees

• [1] Applications have been made by Anglo Coal (Dawson Services) Pty Ltd (Anglo / the Applicant) to the Fair Work Commission (the Commission) for orders pursuant to s.318 of the Fair Work Act 2009 (the Act).

• [2] On 21 May 2025, this matter were allocated to my Chambers. The matter arose from a transaction (namely, a proposed transfer of business which is scheduled to occur on 1 July 2025).

• [3] The Applicant sought for this application to be dealt on the papers.

• [4] The Applicant sought orders from the Commission pursuant to section 318 of the Act that the Macmahon Black Coal Mining Agreement 2023 (Macmahon Black Coal Mining Agreement) do not apply to the employment of employees whose employment transfers to the Applicant from Macmahon Contractors Pty Ltd ACN 007 611 485 (Macmahon) and that in lieu the Applicant's own industrial instrument apply, the Dawson Mines Collective Enterprise Agreement 2024 (Dawson Mines Collective Agreement), with a nominal expiry date of 3 February 2029.

• [5] A Mention/Directions Hearing was held on 2 June 2025. This was attended by the Applicant, the Applicant's legal representative, Ms Tamara Lutvey from Ashurst Australia (Ashurst), the Mining and Energy Union (MEU) and the "Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU).

• [6] The MEU and AMWU did not raise any objections to the Applicant seeking permission for legal representation under section 596 of the Act. I granted the Applicant permission for legal representation under section 596(2)(a) of the Act, on the basis that would assist me to deal with the matter more efficiently.

• [7] I sought the views of the both the MEU and the AMWU in regard to dealing with this application without any further directions being required. The MEU did not have an objection to the course of action. The AMWU submitted that on the stipulation that members or potential member at McMahon make up a substantially smaller cohort than the MEU and given the MEU did not have an objection, the AMWU did not an objection to the course of action as well.

• [8] On basis of the material submitted by the Applicant, I proposed to parties that I would issue a decision in writing, granting the application in terms of the draft order that the Applicant sought and to issue an order to have effect from 1 July 2025.

• [9] The Applicant filed submissions dated 21 May 2025 and the witness statement of Mr Christopher John Newman of Anglo dated 21 May 2025 in support of the Application.

• [10] The Applicant will become the new employer of the majority of persons currently employed by Macmahon at Dawson South, which are covered by the Dawson Mines Collective Agreement (Macmahon Employees). The MacMahon Employees which accept the Applicant's offer of employment will commence employment with the Applicant on 1 July 2025 (Transferring Macmahon Employees).

• [11] The Applicant operates and manages the Dawson Mine, an open-cut steelmaking coal mine in Central Queensland, except for the Dawson South area, which is currently operated and managed by Macmahon under a surface mining contract that commenced in July 2021 and will come to an end on 30 June 2025.

• [12] There are approximately 220 Macmahon Employees who perform work at Dawson South in various mining and maintenance roles. The Macmahon Black Coal Mining Agreement was negotiated by Macmahon, the AMWU and the MEU as bargaining representatives.

• [13] The Applicant has decided to insource the work undertaken by Macmahon Employees at Dawson South upon the end of the surface mining contract and has made offers of employment to 191 Macmahon Employees. The remaining Macmahon Employees will either be transferred to another Macmahon operation, made redundant, or seek employment with contractors who provide services to the Applicant.

• [14] The Act grants the Commission discretion to make certain orders in the case of a transfer of business.

• [15] Section 318(1) of the Act provides that the Commission may, on application by a person or organisation identified in section 318(2) of the Act, make the following orders:

(a) an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;

(b) an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee." "

• [16] Relevantly, in applications pursuant to section 318 of the Act, the Commission must also take account of the specific matters identified in subsection 318(3) of the Act ie:

(i) the new employer or a person who is likely to be the new employer; and

(ii) the employees who would be affected by the order;

(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment;

(c) if the order relates to an enterprise agreement - the nominal expiry date of the agreement:

(d) whether the transferable instrument would have a negative impact on the productivity of the new employer's workplace;

(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;

(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;

• [17] In deciding whether to make an order under section 318(1) of the Act, the Commission must take into account the matters in subsection 318(3) of the Act, which I now do.

• [18] The Applicant submitted that due to the consideration outlined below, the proposed orders that the Applicant sought should be granted.

• [19] The Applicant supported the Application and proposed orders. The Applicant submitted that the Dawson Mines Collective Enterprise Agreement should cover all relevant employees at the Dawson Mine, including the Transferring Macmahon Employees, as it would encourage a single and harmonious workplace culture, promote consistency and certainty in employment terms and conditions, and enhance productivity and efficiency in the workplace.

• [20] Conversely, if the Macmahon Black Coal Mining Agreement covered the Transferring Macmahon Employees in their employment at Dawson Mine, the Applicant believed this would likely:

(a) impede the proper integration of Transferring Macmahon Employees into the Applicant's workforce, as the Applicant seeks to engage its direct-hire workforce on a common set of terms and conditions that are suitable for the Applicant;

(b) mean that the Transferring Macmahon Employees will not enjoy the same certainty of terms and conditions of employment as a result of the nominal expiry date of the Macmahon Black Coal Mining Agreement compared to the nominal expiry date of the Dawson Mines Collective Agreement;

(c) create a negative impact on the productivity of the workforce at the Dawson Mine due to the requirement to administer two different enterprise agreements, which would be confusing for employees and will create significant inefficiencies, costs and unnecessary complexities in the maintenance and administration of divergent payroll and other systems, and potentially lead to disputes; and

(d) create a disparity between the Transferring Macmahon Employees and the Applicant's existing workforce covered by the Dawson Mines Collective Agreement in circumstances which the Dawson Mines Collective Agreement provides, on an overall basis, superior terms and conditions of employment when compared to the Macmahon Black Coal Mining Agreement.

The views of the employees who would be affected by the orders

• [21] As bargaining representatives for the Macmahon Black Coal Mining Agreement, the Applicant had consulted with both the MEU and AMWU. At the time of the written submissions on 21 May 2025, the Applicant noted that the MEU supported the Application and AMWU has not yet confirmed its position on the Application.

• [22] On 14 May 2025, the Applicant sent email correspondence to Transferring Macmahon Employees:

(a) outlining its intention to make an application to the Fair Work Commission pursuant to section 318 of the Act so that the Dawson Mines Collective Agreement, and not the Macmahon Black Coal Mining Agreement, would apply to their employment with the Applicant from 1 July 2025;

(b) asking Transferring Macmahon Employees to advise the Applicant by noon on 21 May 2025 if they did not support the Application;

(c) attaching a document comparing the remuneration under the Dawson Mines Collective Agreement, and the Macmahon Black Coal Mining Agreement; and

(d) attaching a document outlining the key differences between the terms and conditions of the Dawson Mines Collective Agreement, and the Macmahon Black Coal Mining Agreement, as well as providing links to both enterprise agreements.

• [23] The Applicant noted as at the time the Application was filed, no Transferring Macmahon Employees had contacted the Applicant to advise that they did not support the Application.

• [24] The consultation process was set out at paragraphs 45 to 56 of the statement of Mr Christopher John Newman filed in support of this Application.

Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment

• [25] The Applicant submitted that the Transferring Macmahon Employees, with one temporary exception, will receive superior terms and conditions overall under the Dawson Mines Collective Agreement compared to their current arrangements. This means that, for the vast majority of employees, the proposed orders will result in an improvement to their employment conditions, ensuring that they are not disadvantaged by the transfer.

• [26] The sole exception concerns employees currently classified as Mineworker - Specialised (Production Leading Hand) under the Macmahon Black Coal Mining Agreement. These employees will be reclassified as Mine Employee Level 2 (Production) under the Dawson Mines Collective Agreement. This reclassification may result in a temporary difference in terms and conditions for this specific group.

• [27] However, the Applicant referred to paragraphs 65 to 66 of the statement of Christopher John Newman filed in support of this Application, and that they submitted that any potential disadvantage to this group will be more than offset by a range of factors.

If the order relates to an enterprise agreement - the nominal expiry dates of the agreement

• [28] The Applicant submitted that the Transferring Macmahon Employees will have a greater period of certainty regarding their terms and conditions of employment if the proposed orders are made.[1]

• [29] The Dawson Mines Collective Agreement's nominal expiry date is 3 February 2029. The Macmahon Black Coal Mining Agreement's nominal expiry date is 5 April 2027.

Whether the transferable instrument would have a negative impact on productivity of the new employer's workplace

• [30] The Applicant submitted that there would be a negative impact on the productivity of the workforce at the Dawson Mine if the proposed orders are not granted, due to the requirement to administer two enterprise agreements.

• [31] The Applicant submitted that the application of different terms and conditions of employment to the Transferring Macmahon Employees, compared to the Applicant's existing employees with whom they would be working alongside and in collaboration, would likely adversely impact morale, workplace harmony and productivity over time.

• [32] The potential application of the Macmahon Black Coal Mining would create significant inefficiencies and unnecessary complexities in the maintenance and administration of divergent payroll and other systems that would, in turn, hinder productivity.

• [33] Granting the proposed orders would enable administrative simplicity, promote organizational competency, and enable the Applicant to provide internal equity in the terms and conditions of employment between the Transferring Macmahon Employees and its existing employees.[2]

Whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer

• [34] The Applicant submitted that it would incur significant economic disadvantage if the proposed orders are not granted.

• [35] The costs associated with establishing and administering two separate configurations and interpretations of rostering and payroll for Transferring Macmahon Employees and the Applicant's existing employees would be economically inefficient, create confusion among employees, and present ongoing challenges for the Applicant.[3] This dual system would negatively impact operations, which in turn would affect productivity and result in adverse economic consequences.

• [36] Having all employees on the same site performing work under a single enterprise agreement and being paid according to that single industrial instrument would likely reduce the administrative burden associated with processing payroll under two industrial instruments. This approach would also help avoid potential disputes and the associated costs of resolving such disputes.[4]

• [37] The Applicant submitted that a negative impact on productivity, as previously outlined, constitute an additional economic disadvantage that would arise from the transference of the Macmahon Black Coal Mining Agreement.

The degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer

• [38] The Applicant submitted that there was a notable lack of business synergy between the Macmahon EA and the Dawson EA. This absence of synergy would likely give rise to the operational and administrative issues previously described, including the need to manage two separate sets of terms and conditions, rostering systems, and payroll processes. Such duplication would not only increase administrative complexity but also heighten the risk of confusion among employees and management, potentially leading to disputes and inefficiencies.[5]

• [39] The Applicant submitted that granting the Proposed Orders would serve the public interest. The orders were designed to support a smooth and effective transfer of business, which was beneficial not only to the parties directly involved but also to the broader community and industry.[6]

• [40] The Applicant submitted that the proposed orders would facilitate the continued employment of the existing workforce at Dawson South by enabling their transition to the new employer at Dawson Mine. This continuity of employment would be a significant public benefit as it would help to preserve jobs, maintain income stability for employees and their families, and support the local economy. By allowing employees to take up the same or substantially similar positions, the proposed orders would minimise disruption and uncertainty for workers during the transfer process.

• [41] Furthermore, the Applicant submitted that the proposed orders aligned with the objectives of the transfer of business provisions under the Act. Those provisions were intended to balance the protection of employees' terms and conditions with the operational needs of employers. By reducing unnecessary complexity and administrative burden, the proposed orders would enable the new employer to manage its workforce efficiently while still upholding employee rights. This balance would be essential for fostering productive and fair workplace relations, which is a key aspect of the public interest.

• [42] As outlined in paragraphs [7]-[9] of the decision, at the Mention/Directions Hearing of 2 June 2025, the MEU and AMWU did not raise any objections to the Application sought by the Applicant.

• [43] To date, no material has been received from any employees of the Applicant.

• [44] I am satisfied that the requirements of section 318 of the Act have been met and I have decided that it is appropriate to grant the application. An order will be issued with this decision in PR788028.

[1] Re Lend Lease Engineering Pty Ltd [2014] FWC 5499, [30].

[2] Re Facilities First Australia Pty Ltd (T/a Facilities First Australia Pty Ltd) [2019] FWC 6892, [37]-[39].

[4] Re Fleurieu Cranes Pty Ltd [2020] FWC 4712, [28]-[29].

[5] Re Facilities First Australia Pty Ltd (T/a Facilities First Australia Pty Ltd) [2019] FWC 6892, [37]-[39].

[6] Re Silver Chain Group Ltd [2018] FWC 972, [64]-[67].

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