s.739 - Dispute resolution

Alleged dispute about any matters arising under the enterprise agreement and the NES;[s186(6)] - consultation - major workplace change - threshold to enliven the requirement to consult - decision to reduce expenditure was not a firm proposal for workplace change developed by the University - decision to reduce expenditure did not enliven requirement to consult.

• [1] Education Union regarding the consultation provisions of the CSU Enterprise Agreement 2023 - 2025.

• [2] In June 2024 the University announced that it needed to reduce expenditure by $35 million over the next three years. In August and September 2025 the University released Draft Change Proposals for six business units. Each Draft Change Proposal document contains specific workplace changes about which the University has sought to consult with employees and the National Tertiary Education Union (NTEU).

• [3] The NTEU claims that the CSU Enterprise Agreement 2023 - 2025 (the Agreement) requires the University to release Draft Change Proposals for each and every measure that the University proposes to implement in its attempt to reduce expenditure by $35M before consultation can commence.

• [4] The University argued that the announcement and imperative to reduce expenditure by $35M was not a firm proposal for workplace change that enlivens the consultation processes. The University argued that it has met the consultation requirements of the Agreement by publishing Draft Change Proposals each time it has developed firm proposals that would bring about specific workplace change.

• [5] There is some urgency to the dispute because the "non-exacerbation" provisions of the dispute resolution clause of the Agreement prevent the University from continuing attempts to consult with its staff and the NTEU.

• [6] For the reasons that follow I have found that clause 17 of the Agreement permits and requires the University to proceed in the way it has to date - by publishing Draft Change Proposals each time it develops firm proposals that would bring about specific workplace change.

• [7] The University relied on statements from Ms Karen Sutton. Ms Sutton is employed by the University as the Head of CSU Change Program. Ms Sutton is responsible for leading the University-wide Strategic Change Program, which aims to remove approximately $35 million from the University's operating budget. Ms Sutton was not required for cross-examination. The key parts of her witness statement provide a helpful summary of the underlying circumstances in which the dispute has arisen:

"On 24 June 2025, CSU announced to staff and other stakeholders the need to remove $35 million from its operating budget by the end of 2027...

CSU identified this need because it has operated at a planned deficit for three of the past four years, strategically investing in core capabilities on the expectation that international student revenue would increase significantly across 2025, 2026 and 2027 to balance those costs. International student numbers have not increased as expected, and as a result the revenue forecasts underpinning CSU's forward plans will not be met. The removal of $35 million from the operating budget is therefore necessary in order to restore the financial sustainability of the University.

CSU determined that, in order to enable a balanced and sustainable approach to achieving the required savings by the 2027 deadline, it is necessary for the University to progress an organisational change program structured into two distinct "Phases" of implementation. Phase One (1), with a target to remove approximately $5 million, was planned to take place in 2025 and comprised a series of independent changes that had already been identified, or were readily identifiable, as areas where work could be reduced or ceased to deliver much needed initial savings. These changes are specific and targeted, relating to functions where the need for a reduction in work was clear and could be implemented within a shorter timeframe to relieve immediate financial pressure and ensure savings were realised within the 2026 budget. If these savings are not realised, ongoing salary and entitlement costs will increase over time, increasing the risk that CSU does not achieve the overall $35 million savings target.

Phase Two (2), by contrast, is planned to take place in 2026 and 2027 and involves a broader, University-wide review of operations to identify further opportunities to simplify, cease, or re-shape work that will deliver both salary and non-salary savings...

By phasing the $35 million reduction over three years (2025-2027), CSU can:

(a) take initial action in 2025 to stabilise finances and reduce the level of drawdown of reserves,

(b) allow time to adjust plans and monitor changes in government policy that may affect income, and

(c) protect jobs where possible by spreading the savings over a longer period.

This phased approach balances the need for immediate financial relief with long-term sustainability and workforce stability. Delaying all changes until the Phase Two (2) rollout period (as the NTEU suggests) would have compressed the timeframe to achieve the financial target, increased workforce and operational risks by concentrating more change into a shorter period and potentially placing greater pressure on financial reserves.

As part of the 2025 Phase One (1) changes, CSU developed separate 'Change Proposals' in respect of ... six (6) distinct business units...

Each of these business units represents a separate and distinct component of the CSU landscape. They are separate and distinct, including for the purposes of the organisational change program, because:

(a) each of the business units performs specific work which is unrelated to the work performed by the other business units, requiring different skills and expertise;

(b) each of the business units has its own Change Sponsors, which do not exercise any managerial influence over the other business units; and

(c) each of the changes being proposed is supported by a rationale which is specific to that particular business unit. While these changes may have been catalysed by the underlying imperative for CSU to return to financial sustainability, the Change Proposals themselves set out the specific financial and operational issues within the particular business unit upon which the proposed changes have been based...

... While each of the Change Proposals were underpinned by the same overarching rationale of achieving financial sustainability, the specific work changes and staff impacts were different, affecting separate business areas with employees of varied skill sets and professional backgrounds...

[The] $35 million target also includes measures unrelated to salary savings and not involving major workplace changes of the kind that would trigger consultation obligations under the Agreement. These measures, estimated at approximately $5 million, fall outside the scope of employment-related consultation...

In the short term, delaying implementation will mean the planned savings for 2025 will not be realised within the required timeframe, placing additional pressure on CSU's operating budget. Without these vital savings, CSU will need to draw further on its reserves, potentially reducing them below the threshold set by the University Council (Council) as part of its financial sustainability principles. This will reduce the University's capacity to respond to future shocks or to invest strategically and therefore poses substantial risk.

In the medium term, the delay will compress the timeframe available to achieve the full $35 million target, requiring larger or faster savings in later years to compensate for what is being deferred."

• [8] The NTEU relied on a statement by Dr Anna Corbo Crehan. Dr Corbo Crehan has worked for the University for 26 years and is the President of the Charles Sturt University Branch of the NTEU. Dr Corbo Crehan's statement did not assist in understanding the dispute or in the task of interpreting the Agreement. In her statement Dr Corbo Crehan included some general reflections on the anxiety felt by some employees about the change proposals.

• [9] For expediency I have briefly summarised the respective submissions.

(a) in simple terms, each proposed restructure stands alone and the only 'common feature' is the saving required;

(b) accordingly, the relevant consultation provisions of clause 17 of the Agreement may be discharged separately and in a phased way - consultation is not required to occur globally;

(c) the Draft Change Proposals issued for each of the six business units meet the requirements of clause 17;

(d) the intended purpose of clause 17 is found in clause 17.1, viz:

"It is recognised that change will occur as the University evolves over time and as circumstances require. It is also acknowledged that sound management of workplace change requires the engagement of employees who will be directly affected by the proposed change through consultation with them and, where they so choose, their nominated employee representative or their union. Where practicable, the University will include employees who are on leave, their nominated representative or their union in the consultation process."

(e) clause 17 recognises that change is inevitable but tempers such change by recognising that 'consultation' is a substantive and meaningful obligation which is of real industrial importance;

(f) consultation is limited to those employees who are affected by the proposed change;

(g) there is nothing in clause 17 of the Agreement (or otherwise) which prevents the University from issuing distinct change proposals for each Business Unit;

(h) no decisions that have significant effect on employees have been made in connection with Phase Two, therefore the University is not required to consult about changes it has not yet decided to propose; and

(i) the mere fact that CSU has determined that it needs to reduce its expenditure and bring its budget under control does not enliven clause 17.21 or clause 17 at all.

(a) in truth the proposed change is the overall restructure being undertaken by the university. The change proposals for each business unit are not separate proposals but part of a single change proposal;

(b) the rationale offered in support of each proposal is identical, being that each proposal is said to contribute to the University's goal of achieving savings of $35 million;

(c) the goal of clause 17.21 is ascertaining any potential impacts not directly identified, and the provision acknowledges the reality that management's perspectives and assumptions may not capture the totality of the situation;

(d) staff are unable to meaningfully provide feedback unless and until the proposal is viewed as a whole, so that identified impacts [by management] can become apparent;

(e) some "Phase One" proposals could have synergies with areas of the university impacted by "Phase Two" proposals;

(f) the narrative utilised by the University is a carbon copy of the narrative utilised by many universities across Australia at the present time;

(g) the Agreement requires that the university consult about the changes concurrently, but does not require that the changes are implemented concurrently;

(h) the materials published to date highlight the disjointed and piecemeal fashion in which information is being released;

(i) staff are being kept in silos, unable to collaborate with their colleagues in identifying potential impacts not initially identified;

(j) giving more time and more information will allow employees more opportunities to explore their options and to feel a sense of control over the situation, which will reduce the psychosocial hazards for employees; and

(k) in response to the submission that each of the business units operate independently from other business units, the NTEU submitted that there may well be links and connections between the business units [at industrial level, academic level operational level, health and safety level etc] that management are not aware of.

• [12] The relevant provisions in clause 17 are as follows:

"17.1 It is recognised that change will occur as the University evolves over time and as circumstances require. It is also acknowledged that sound management of workplace change requires the engagement of employees who will be directly affected by the proposed change through consultation with them and, where they so choose, their nominated employee representative or their union. Where practicable, the University will include employees who are on leave, their nominated representative or their union in the consultation process.

17.17 A change proposal process is required for major workplace change involving organisational change or employment policy change that will significantly affect the job security and/or employment conditions of employees. Significant effects include:

1. termination of employment;
2. major changes in the composition, operation or size of the employer's workforce;
3. the restructuring of jobs;
4. transferring employees to other campus locations or sites.

17.21 When the University has developed a firm proposal for workplace change of the kind referred to in sub-clause 17.17 and affecting more than one (1) employee, the University will develop a Draft Change Proposal outlining the particulars of the workplace change proposal under consideration.

The University will invite all employees and where they so choose their nominated employee representative or their union, to provide feedback on the proposed change to ascertain any potential impacts not initially identified.

17.22 The University will give the relevant unions advance notice on a confidential basis that a Draft Change Proposal will be issued. The Draft Change Proposal shall be provided in the first instance to the employees likely to be directly affected and the relevant unions before it is made available to the wider workforce.

17.23 The Draft Change Proposal will also be provided to the Employee Consultative Committee (ECC) for information only.

17.24 The Draft Change Proposal will include the proposed timelines for implementation and the rationale for the change, detailing:

1. aims and objectives of the change;
2. the likely effects of the change upon employees;
3. the workload and work health and safety implications of the proposed changes and any required mitigation measures;
4. key responsibilities of positions in the new structure (where applicable);
5. the high-level financial implications of the proposed change;
6. proposed redundancies and/or redeployments; and
7. the job security process to be undertaken.

17.25 Once the Draft Change Proposal has been provided in accordance with sub-clause 17.22, the University shall meet and consult with affected employees, and where they so choose their nominated employee representative or their union, to discuss the rationale of the proposal and the impact the proposed changes are likely to have on the employees.

17.26 Affected employees, and where they so choose their nominated employee representative or their union, will be given at least fifteen (15) working days to provide a response on receipt of a Draft Change Proposal. In the event that adjustments are made to the Draft Change Proposal during the consultation period that have a material impact, the consultation period will be extended by the amount of time that had elapsed when the updated Draft Change Proposal was issued.

17.27 The University will give due consideration to such submissions and, where material changes (that is, amendments to the Draft Change Proposal involving matters set out in sub-clause 17.17) are proposed, shall provide affected employees, and where they so choose, their nominated employee representative or their union, with a Revised Change Proposal. The Revised Change Proposal will set out amendments to the Draft Change Proposal and explain how feedback received was addressed in making revisions to the initial Draft Change Proposal, including but not limited to, feedback on workload concerns.

17.28 Where material changes have been made to the Draft Change Proposal, the Revised Change Proposal will be subject to a further consultation period of five (5) working days. Following consideration of feedback on the Revised Change Proposal, the University will release a Final Change Plan, which will include implementation details.

17.29 Where there are no material changes, the University will release a Final Change Plan, which will include implementation details..."

• [13] In AMWU v Berri Pty Limited [2017] FWCFB 3005, (2017) 268 IR 285 ("Berri") the Full Bench distilled principles for interpreting enterprise agreements. Those principles are often quoted and are not controversial.

• [14] The Federal Court has applied substantially the same approach. In James Cook University v Ridd [2020] FCAFC 123 at [65], [2020] FCAFC 123; (2020) 278 FCR 566, (2020) 298 IR 50 the Full Court of the Federal Court summarised the relevant principles applicable to the interpretation of an enterprise agreement:

(i) The starting point is the ordinary meaning of the words, read as a whole and in context (City of Wanneroo v Holmes [1989] FCA 553; 30 IR 362, 378; City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426 [53]; WorkPac Pty Ltd v Skene [2018] FCAFC 131; 264 FCR 536 [197]).

(ii) A purposive approach is preferred to a narrow or pedantic approach - the framers of such documents were likely to be of a "practical bent of mind" (Kucks v CSR Limited [1996] 66 IR 182, 184; Shop Distributive and Allied Employees' Association v Woolworths SA Pty Ltd [2011] FCAFC 67 [16]; WorkPac Pty Ltd v Skene [2018] FCAFC 131; 264 FCR 536 [197]). The interpretation "turns upon the language of the particular agreement, understood in the light of its industrial context and purpose" (Amcor Limited v Construction, Forestry, Mining and Energy Union [2005] HCA 10; 222 CLR 241 [2]).

(iii) Context is not confined to the words of the instrument surrounding the expression to be construed (City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426 [53]). It may extend to "... the entire document of which it is a part, or to other documents with which there is an association" (Short v FW Hercus Pty Ltd [1993] FCA 51; 40 FCR 511, 518; Australian Municipal, Administrative, Clerical and Services Union v Treasurer of the Commonwealth of Australia [1998] FCA 249; 82 FCR 175, 178).

(iv) Context may include "... ideas that gave rise to an expression in a document from which it has been taken" (Short v FW Hercus Pty Ltd [1993] FCA 51; 40 FCR 511, 518).

(v) Recourse may be had to the history of a particular clause "Where the circumstances allow the court to conclude that a clause in an award is the product of a history, out of which it grew to be adopted in its present form..." (Short v FW Hercus Pty Ltd [1993] FCA 51; 40 FCR 511, 518).

(vi) A generous construction is preferred over a strictly literal approach (Geo A Bond and Co Ltd (in liq) v McKenzie [1929] AR 499, 503-4; City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426 [57]), but "Awards, whether made by consent or otherwise, should make sense according to the basic conventions of the English language. They bind the parties on pain of pecuniary penalties" (City of Wanneroo v Holmes [1989] FCA 553; 30 IR 362, 380).

(vii) Words are not to be interpreted in a vacuum divorced from industrial realities but in the light of the customs and working conditions of the particular industry (City of Wanneroo v Holmes [1989] FCA 553; 30 IR 362, 378-9; WorkPac Pty Ltd v Skene [2018] FCAFC 131; 264 FCR 536 [197]).

• [15] On review in Ridd v James Cook University (2021) 310 IR 109, [2021] HCA 32 at [17] the High Court observed:

"... Both parties sought to resolve any tension between the Enterprise Agreement and the Code of Conduct by interpretation of the Enterprise Agreement itself, particularly cl 14. In that process of interpretation, an important matter of context is the industrial nature of the instrument. Industrial instruments are not always drafted carefully by lawyers or professional drafters, and hence the literal words of a provision might more readily be understood to have a meaning other than their ordinary meaning if the context so suggests."

• [16] As the Full Court in WorkPac Pty Ltd v Skene (2018) 264 FCR 536, [2018] FCAFC 131 summarised at [197]:

"The starting point for interpretation of an enterprise agreement is the ordinary meaning of the words, read as a whole and in context. The interpretation "turns on the language of the particular agreement, understood in the light of its industrial context and purpose." The words are not to be interpreted in a vacuum divorced from industrial realities; rather, industrial agreements are made for various industries in the light of the customs and working conditions of each, and they are frequently couched in terms intelligible to the parties but without the careful attention to form and draftsmanship that one expects to find in an Act of Parliament. To similar effect, it has been said that the framers of such documents were likely of a "practical bent of mind" and may well have been more concerned with expressing an intention in a way likely to be understood in the relevant industry rather than with legal niceties and jargon, so that a purposive approach to interpretation is appropriate and a narrow or pedantic approach is misplaced."

• [17] It is agreed that the changes proposed by the University are major changes as described in clause 17.17.

• [18] Clause 17 imposes various obligations on the University when proposing major change. The University is required to:

(a) develop a Draft Change Proposal (cl 17.21) that includes the information listed in clause 17.24;

(b) provide the Draft Change Proposal to the relevant unions on a confidential basis (cl 17.22);

(c) provide the Draft Change Proposal to the Employee Consultative Committee for information only (cl 17.23);

(d) provide the Draft Change Proposal to affected employees and perhaps all employees, inviting feedback (cl 17.21);

(e) meet with affected employees and their union or representative (cl 17.25);

(f) give due consideration to the responses received (cl 17.27);

(g) where applicable, publish a Revised Change Proposal (cl 17.27);

(h) have a further brief period of consultation (cl 17.28); and

(i) publish a Final Change Plan (cl 17.29).

• [19] These consultation obligations only arise in certain circumstances. Not every decision by the University requires consultation, nor does every proposal for change require consultation.

• [20] Enterprise Agreements must contain a consultation term (see s.205). Some agreements contain more elaborate consultation or introduction of change provisions than the statutory minimum. The parties decide the kinds of decisions and proposals that must be the subject of consultation beyond the statutory minima, as well as how that consultation is to take place. Usually the threshold to enliven the consultation requirements is agreed by reference to the type or kind of change that is proposed, and/or the potential impact for employees, and/or the degree of finality or firmness of the employer's decision to introduce change.

• [21] The terms of clause 17.21 are a specific accord between the parties regarding the kinds of decisions and proposals that must be the subject of consultation, and the remainder of clause 17 records the agreement of the parties on how that consultation is to take place.

• [22] Contrary to the case advanced by the NTEU, the agreed threshold to enliven the consultation obligations is found in the first sentence of clause 17.21:

"When the university has developed a firm proposal for workplace change of the kind referred to in subclause 17.17 and affecting more than one (1) employee, the University will ..."

• [23] It was agreed at the hearing that the gateway into the consultation provisions for major workplace changes is clause 17.21. However the NTEU argued that if multiple workplace changes are proposed, and there is a single common rationale for the proposed changes, then clause 17.21 is triggered and the obligations arise. The NTEU submitted that the most important words of clause 17.21 are in the last sentence:

"When the University has developed a firm proposal for workplace change of the kind referred to in sub-clause 17.17 and affecting more than one (1) employee, the University will develop a Draft Change Proposal outlining the particulars of the workplace change proposal under consideration.

The University will invite all employees and where they so choose their nominated employee representative or their union, to provide feedback on the proposed change to ascertain any potential impacts not initially identified."

• [24] The NTEU submitted that the final words show that the purpose of clause 17.21, and the consultation processes that flow from clause 17.21, is to allow staff to provide feedback on proposed changes and raise impacts not otherwise identified by the employer. The NTEU said that clause 17.21 recognises that "management don't necessarily have an understanding of how things work on the frontline" [and therefore would benefit from the input of those on the frontline] and the clause was included because "we don't know what we don't know."

• [25] The nub of the present dispute is the NTEU's claim that the University cannot commence consultation about any of the proposed changes unless and until it has issued Draft Change Proposals for each and every change associated with the common rationale of reducing expenditure by $35M or issued a single Draft Change Proposal that includes every proposed change.

• [26] To make good this construction the NTEU said that the global decision to reduce expenditure morphed into a common rationale for the particular changes proposed, which inferentially meant that each proposal for workplace change must be dealt with in conjunction with each other proposal for workplace change that shares the same rationale.

• [27] The NTEU primarily relied on the consequences of its preferred interpretation to support the interpretation itself. For example, the NTEU said that:

"Staff cannot meaningfully exercise their right "to provide feedback" on the proposed change if they are being drip fed information in a piecemeal fashion. In order to meaningfully exercise their right to provide feedback on the proposed change, staff must be provided with all the relevant information at the one time, so that they can see the whole situation."

• [28] Submissions of this kind do not assist the task at hand. Every orthodox interpretation methodology starts with the ordinary meaning of the words, read as a whole and in context.

• [29] The words of clause 17.21 do not support the NTEU's construction. Clause 17.21 only applies once the employer has developed a firm proposal for workplace change. The rationale for a proposal is not relevant to whether the proposal is one for workplace change. Providing feedback on 'the proposed change to ascertain any potential impacts not initially identified' is one of the actions available if the clause is enlivened, but only if the clause is enlivened.

• [30] There are references to the rationale for proposed changes in later sub-clauses. The Draft Change Proposal (cl 17.21) must include the rationale for the change (cl 17.24) and the University must meet with the affected employees and their union "to discuss the rationale for the proposal and the impact ..." (cl 17.25).

• [31] Quite obviously the rationale for a proposed workplace change is relevant to the consultation process. However, in setting the threshold to enliven the consultation obligations, clause 17.21 does not directly or indirectly refer to the rationale for a proposed change.

• [32] The recognition by the University's governing council of the need to remove $35 million from its operating budget by the end of 2027 was not of itself a decision to make "workplace change of the kind referred to in sub-clause 17.17" (as clause 17.21 requires), nor was it a "firm proposal" that the council had "developed" (see by analogy NTEU v Deakin University [2020] FWC 4013 at [51]).

• [33] At the hearing the NTEU ultimately accepted that the decision to reduce expenditure by $35 million did not trigger clause 17.21. In other words, the NTEU conceded that the decision to reduce expenditure was not a firm proposal for workplace change developed by the University. This concession was properly made.

• [34] The kinds of changes contemplated in the six Draft Change Proposals issued by the University are very much firm proposals for workplace change developed by the University. The University is required to consult about these proposed changes and has done so. Consultation is not complete because the NTEU invoked the dispute resolution procedures and the "non-exacerbation" provisions.

• [35] There is no other suggestion or allegation that the University has failed to meet the consultation requirements of clause 17. The determination of this dispute will mark the completion of the dispute settling procedure within clause 53 of the Agreement. The University will now be able to continue its consultation process.

• [36] The University submitted that the question for the Commission to determine is:

"Whether on the proper construction of clause 17 of the Enterprise Agreement, CSU is prevented from issuing distinct change proposals to achieve the cost savings set out in the Announcement with respect to each Business Unit and/or issuing change proposals in separate tranches?"

• [37] I have determined that the answer to the University's question is no.

• [38] The NTEU submitted that the question for the Commission to determine is:

"Can employees meaningfully exercise their right "to provide feedback on the proposed change to ascertain any potential impacts not initially identified" if they are being provided information about "the proposed change" in a piecemeal fashion."

• [39] As should be apparent from my reasoning above, the NTEU's formulation of the question is wrong because it does not engage with the ordinary meaning of the words of clause 17.21 read as a whole and in context. None of the Draft Change Proposals issued by the University provide information about the proposed changes in a piecemeal fashion. The "proposed change" referred to is, by the words of clause 17.21, the workplace change about which the employer has developed a firm proposal.

M Baroni of Counsel, instructed by J Light and H McLaurin of Herbert Smith Freehills Kramer

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