Fair Work Act 2009

s.604 - Appeal of decisions

Construction, Forestry, Maritime, Mining and Energy Union

FMS Group Pty Ltd t/a Field Mining Services Group

Appeal against decision [2021] FWCA 6700 of Commissioner McKinnon at Melbourne on 16 November 2021 in matter number AG2021/7047.

[1] The Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) has lodged an appeal, for which permission is required, against a decision of Commissioner McKinnon published on 16 November 2021[1] to approve the FMS Employee Agreement 2021[2] (2021 Agreement). The CFMMEU contends in its amended appeal notice and submissions that the decision to approve the 2021 Agreement was in error and should be quashed on the following grounds:

(1) The Commissioner approved the 2021 Agreement on the basis of an undertaking that was incapable of meeting the Commissioner's concern that the employer under the agreement, FMS Group Pty Ltd (FMS), had failed to explain the terms of the agreement and their effect to the employees who would be covered by the agreement and who were thereby entitled to vote upon it (relevant employees) in accordance with s 180(5) of the Fair Work Act 2009 (FW Act).

(2) The Commissioner erroneously concluded that FMS's failure to issue a Notice of Employee Representational Rights (NERR) which complied with the content requirements of s 174 of the FW Act was, for the purpose of s 188(2)(a), a minor technical error.

(3) The Commissioner erroneously concluded that FMS's failure to issue a compliant NERR was not, for the purpose of s 188(2)(b), likely to have disadvantaged the relevant employees.

[2] Section 186(1) of the FW Act requires that the Commission must approve an enterprise agreement upon application if the requirements set out in ss 186 and 187 are met. One of those requirements, in s 186(2)(a), is that the Commission must be satisfied that the agreement has been "genuinely agreed" to by the employees covered by the agreement. Section 188(1) sets out the criteria for an enterprise agreement to have been "genuinely agreed" for the purpose of s 186(2)(a). These include, in s 188(1)(a) and (b), that the employer has complied with a number of identified statutory requirements, including (in s 188(1)(a)(i)) the requirement in s 180(5)(a) that the employer must take all reasonable steps to explain to the relevant employees the terms of the agreement and their effect prior to requesting them to vote to approve it. Section 188(2) provides for an alternative criterion for the "genuinely agreed" requirement to be satisfied. It applies if the Commission is satisfied that the agreement would have been genuinely agreed to but for minor procedural or technical errors in relation to (relevantly) the requirements in s 188(1)(a) and (b) (including, relevantly, the requirement for compliance with s 180(5)(a)) and that the employees covered by the agreement were not likely to have been disadvantaged by the errors.

[3] Where the Commission has a concern that an agreement does not meet the requirements set out in ss 186 and 187, s 190(2) provides that the Commission nonetheless "may approve the agreement" if satisfied that an undertaking accepted by the Commission under s 190(3) "meets the concern". Section 190(3) provides that the Commission may accept an undertaking from the employer(s) covered by the agreement if the Commission is satisfied that such acceptance is not likely to cause any financial detriment to any employees covered by the agreement or result in substantial changes to the agreement.

[4] The CFMMEU's contentions of error arise from the scope of coverage of the 2021 Agreement. Clause 4.1 of the 2021 Agreement provides for the relevant aspect of the agreement's coverage as follows:

4.1 This Agreement applies to and is binding on the Company in relation to all of its Employees, engaged across Australia in the classifications contained herein, who are covered by the following Modern Awards:

b) Manufacturing and Associated Industries and Occupations Award 2020

d) Building and Construction General On-Site Award 2020

[5] The enterprise agreement which applied to employees of FMS covered by the 2021 Agreement immediately prior to the 2021 Agreement coming into effect was the FMS Employee Agreement 2018[3] (2018 Agreement). Clause 4.1 of the 2018 Agreement provided for its coverage in the following terms:

4.1 This Agreement applies to and is binding on the Company in relation to all of its Employees, engaged across Australia, who are covered by the following Modern Awards:

b) Manufacturing and Associated Industries and Occupations Award 2010

d) Building and Construction General On-Site Award 2010

[6] It may be seen, by comparing the two coverage provisions above, that the 2018 Agreement covers employees of FMS covered by the Hydrocarbons Industry (Upstream) Award 2010 (Hydrocarbons Award) whereas the 2021 Agreement does not. It is not in dispute that, at the time the 2021 Agreement was made, no relevant employee was actually covered by the Hydrocarbons Award. It has not been suggested that there has been any change to this position since this time.

[7] Bargaining for the 2021 Agreement was initiated when FMS issued a NERR to the relevant employees on 20 May 2021. Section 174(1A) of the FW Act requires that a NERR contain the content prescribed by the regulations, not contain any other content and be in the form prescribed by the regulations. Pursuant to reg 2.05 of the Fair Work Regulations 2009 (FW Regulations), the prescribed form for the NERR is contained in Schedule 2.1 of the FW Regulations. The prescribed form requires the first sentence of the NERR to be as follows:

[Name of employer] gives notice that it is bargaining in relation to an enterprise agreement ([name of the proposed enterprise agreement]) which is proposed to cover employees that [proposed coverage].

[8] The corresponding sentence in the NERR issued by FMS on 20 May 2021 was:

"FMS Group Pty Ltd gives notice that it is bargaining in relation to an enterprise agreement (FMS Employee Agreement 2021) which is proposed to cover employees that are employed by FMS Group Pty Ltd across Australia who are engaged in the classifications defined therein."

[9] No proposed agreement or document setting out the classifications to be contained in the proposed agreement was provided to the relevant employees together with or at the same time as the NERR.

[10] On 19 August 2021, FMS sent to the relevant employees by email a copy of the proposed 2021 Agreement, comparison tables between the awards referred to in clause 4.1 of that proposed agreement and the terms of the proposed agreement (comparison tables), a document to explain the terms of the proposed agreement (explanation document), and a notice in respect of the ballot to be conducted to approve the 2021 Agreement. The explanation document included a section which sought to identify the differences between the proposed 2021 Agreement and the 2018 Agreement and each of the five modern awards referred to in clause 4.1, and also set out the rates of pay provided for in the 2021 Agreement for employees covered by each of the same five modern awards. However, the explanation document made no express reference to the change in the scope of coverage effected by the non-inclusion of the Hydrocarbons Award in clause 4.1 of the 2021 Agreement, nor did it explain that if any employee took on a role covered by the Hydrocarbons Award they would be covered by the 2018 Agreement rather than the 2021 Agreement.

[11] Meetings were held between FMS management and groups of employees in the period between 20-26 August 2021 to discuss the proposed agreement and answer any questions from employees. On 28 August 2021, the 2021 Agreement was made when 227 employees, out of 241 who voted and a total of 414 relevant employees, voted to approve the 2021 Agreement.

[12] On 3 September 2021, FMS applied to the Commission for approval of the Agreement. On 20 September 2021, the CFMMEU, which had been a bargaining representative for the 2021 Agreement, filed a Form F18 in which stated that it did not support the approval of the 2021 Agreement because the agreement did not pass the better off overall test (BOOT) and because the pre-approval requirements to issue a valid NERR and to take all reasonable steps to explain the terms of the 2021 Agreement to the relevant employees were not complied with.

[13] No issue concerning compliance with the BOOT is raised by the CFMMEU's appeal, so it is not necessary to refer to the Commissioner's consideration of that matter. In relation to the CFMMEU's contentions that the NERR was non-compliant with s 174(1A), the Commissioner made the following finding:

"[9] ... The question remains whether the notice describes the 2021 Agreement's proposed coverage. While there is a description contained within the notice, it omits one of the three characteristics that inform whether a person is covered by the 2021 Agreement. That is, employees must be employed by FMS; they can be employed anywhere in Australia; and thirdly, they must be engaged in one of the classifications defined in the 2021 Agreement. In this last respect the notice is incomplete because it describes where to find the information, but not the information itself."

[14] The Commissioner then proceeded to consider whether, notwithstanding this finding, the 2021 Agreement could nonetheless be considered to have been genuinely agreed pursuant to s 188(2) of the FW Act. Her consideration in this respect had regard to a submission advanced by the CFMMEU that the consequence of the non-compliant NERR was that employees could not know if they would be covered by the 2021 Agreement and were not given a proper opportunity to exercise their representational rights.[4] The Commissioner said:

"[11] The CFMMEU's submission invites consideration of the proposed coverage description in a vacuum, without regard to the context in which the notice was given. Employees are likely to have understood they would be covered by the 2021 Agreement both because they had received the notice, and because they were already covered by the FMS Employee Agreement 2018 (the 2018 Agreement). With one exception, the work covered by the 2018 Agreement and the 2021 Agreement is identical. The only difference is that work covered by the Hydrocarbons Industry (Upstream) Award 2010 (Hydrocarbons Award) is covered by the 2018 Agreement but not covered by the 2021 Agreement. As no relevant employee was, or is, engaged to perform that work, the difference was not material to them. If this changes in future so that work is performed that would be covered by the Hydrocarbons Award, the 2018 Agreement will continue to apply. The 2021 Agreement does not alter the position of employees who do, or may in future, perform work covered by the Hydrocarbons Award.

[12] FMS submits that all relevant employees were given a copy of the notice and there is no reason to believe that this was not the case. There is also no suggestion in the materials that employees who received the notice of employee representational rights did not understand that it was relevant to them. At least three employees exercised their representational rights, leading to the involvement of the CFMMEU as an active participant in bargaining on behalf of its members for the 2021 Agreement, with a particular interest in the black coal mining industry. Two additional employees were nominated as employee bargaining representatives.

[13] ... In my view, employees are unlikely to have been disadvantaged by the error, including because the 2021 Agreement replaces the 2018 Agreement which is in very similar terms. Where the two diverge, they do so in two respects. One (the narrower coverage) was immaterial to relevant employees. The other was a series of changes to working conditions in the black coal mining industry. These changes were the subject of bargaining between the parties, with employees represented at the bargaining table by both experienced union representatives and individual employees.

[14] In the circumstances, I find that the notice did not adequately describe the proposed

coverage of the 2021 Agreement for the purposes of section 174 and that this was a minor technical error of the kind contemplated by section 188(2A). Employees are unlikely to have been disadvantaged by the error."

[15] In relation to the CFMMEU's contention that FMS failed to comply with s 180(5), the Commissioner found:

"[17] The 2021 Agreement has no effect in relation to work covered by the Hydrocarbons Award because it will not cover or apply to that work. That this work will remain covered by the 2018 Agreement was not explained to employees, despite a summary of the 'main differences' between the 2018 and 2021 Agreements having been provided. The information was available for employees to discern by reading the coverage clauses of the 2018 Agreement and the 2021 Agreement. However, I agree that the explanation of this difference to employees in relation to potential future work was a reasonable step for FMS to take."

[16] In the proceedings at first instance, FMS offered the following undertaking (coverage undertaking) to deal with any concern about non-compliance with s 180(5):

"Clause 4.2 - Application: add '(c) Employees who are employed with the Company, who would otherwise be covered by the Hydrocarbons Industry (Upstream) Award 2020, will remain covered by the terms of the existing FMS Employee Agreement 2018 until such time as that agreement is replaced or terminated."

[17] The Commissioner determined to accept the coverage undertaking under s 190 of the FW Act for the following reasons:

"[18] My concern about genuine agreement only arises in relation to potential future work because no employees are presently engaged to perform that work. FMS has given an undertaking that clearly states the missing information: that work covered by the Hydrocarbons Award remains covered by the 2018 Agreement. The undertaking does not change the 2021 Agreement. It effectively renders the omission moot by providing that part of the explanation not given. In the circumstances, the explanation being given now rather than during in late August 2021, during the access period, has no practical bearing on the outcome of the vote, because it was an issue that did not affect any of the employees in any material way."

[18] In respect of its first ground of appeal relating to the Commissioner's acceptance of the coverage undertaking to meet her concern as to compliance with s 180(5), the CFMMEU submitted that the undertaking should not have been accepted because it bore no logical relationship to the concern it was intended to address and was incapable of meeting that concern. The Commissioner, it was submitted, accepted the coverage undertaking on the basis that it would supply the information which was not supplied to the relevant employees in accordance with s 180(5) and, in doing so, incorrectly assumed that an explanation provided as a term of the Agreement is capable of rectifying an omission to provide that information in advance of the relevant employees being asked to cast a vote in the ballot for the 2021 Agreement. The CFMMEU also submitted that the Commissioner mistook the facts when finding that the difference between the coverage of the 2021 Agreement and that of the 2018 Agreement had no material effect on the relevant employees, since if an employee covered by the 2021 Agreement was in the future moved to a role covered by the Hydrocarbons Award, they would no longer be entitled to the benefits of the 2021 Agreement and would revert to being covered by the 2018 Agreement. The CFMMEU submitted that the only undertaking that might remedy the identified non-compliance would be to expand the coverage of the 2021 Agreement to employment covered by the Hydrocarbons Award but, if such an extension was to be contemplated, the Commission would need to give serious consideration pursuant to s 190(3) as to whether this would be likely to result in a substantial change to the 2021 Agreement.

[19] As to its second ground of appeal, namely that the Commissioner erred in finding that the non-compliant NERR constituted a minor technical error for the purpose of s 188(2)(a), the CFMMEU submitted that the Commissioner mistook the facts when finding that the relevant employees were likely to have understood that the 2021 Agreement would have covered them since there was no evidence upon which such a finding could have been made. Further, it was submitted, the Commissioner took into account the irrelevant considerations that the relevant employees had received the NERR and were already covered by the 2018 Agreement, neither of which considerations supported a finding that the relevant employees understood the 2021 Agreement's proposed coverage. The CFMMEU submitted that, because the Commission's exercise of the discretion was tainted with error, the Full Bench ought to redetermine the matter and find that the non-compliant NERR was not a minor error within the meaning of s 188(2)(a).

[20] In relation to its third ground of appeal that the Commissioner erred by finding, for the purpose of s 188(2)(b), that the relevant employees were not likely to have been disadvantaged by the non-compliant NERR, the CFMMEU submitted that the relevant employees did not know the coverage of the proposed agreement at the time the NERR was distributed and there was no evidence to support the finding made by the Commissioner. In circumstances where FMS did not distribute the proposed 2021 Agreement until 19 August 2021, it was submitted that the employees were prevented from substantively exercising their rights in the bargaining regime in Pt 2-4 of the FW Act because they had no way of knowing prior to the commencement of bargaining what the proposed coverage was and whether this would affect their interests. For these reasons, the CFMMEU submitted, it was not open for the Commissioner to have made the finding that she did.

[21] The CFMMEU submitted that permission to appeal should be granted because the legal principles applied in the decision under appeal are disharmonious with the Full Bench authorities in CFMMEU; AWU; AMWU and CEPU v OS ACPM Pty Ltd and OS MCAP Pty Ltd[5] (OS MCAP) and CFMMEU v Karijini Rail Pty Limited[6] (Karijini) concerning the acceptance of undertakings and the decision in Spotless Facility Services Pty Ltd,[7] in which it was held that it was not a minor technical error for a NERR to describe a narrower proposed coverage than that of the resulting agreement.

[22] FMS submitted, in relation to the CFMMEU's first ground of appeal, that the coverage undertaking which the Commissioner accepted had a logical relationship with the identified non-compliance with s 180(5) because it correctly states what the relevant effect of s 58 of the FW Act is, confirms that employees covered by the Hydrocarbons Award are not covered by the 2021 Agreement and thus clarifies a matter that was not previously explained. It was submitted that there was no evidence before the Commissioner as to the prospect of any relevant employee being moved to a role covered by the Hydrocarbons Award nor any evidence to suggest that the lack of explanation concerning the non-coverage of work under the Hydrocarbons Award could have had any practical bearing on the outcome of the vote. As a consequence, it was submitted, the CFMMEU's submission that the Commissioner mistook the facts and failed to take into account a relevant consideration should be rejected. In any event, FMS submitted, the lack of explanation was a minor procedural error for the purpose of s 188(2) because it was plain what awards were covered, and no disadvantage was likely given that no workers covered by the Hydrocarbons Award were employed and there was no evidence of any prospect of this.

[23] As to the second ground of appeal, FMS submitted that the evidence demonstrated that the NERR was sent to all employees who were to be covered by the 2021 Agreement and thus all employees were aware that their employer intended to bargain for an enterprise agreement and were aware of their representational rights. It was open for the Commissioner to find that the employees were likely to have understood they would be covered by the 2021 Agreement, it was submitted, because they had received the NERR and, consequently, there was no error of fact or failure to take into account a relevant consideration on the part of the Commissioner such as would constitute an error in the exercise of the discretion under s 188(2).

[24] FMS submitted that the CFMMEU's third ground of appeal should be rejected because the CFMMEU had not demonstrated that the finding that the non-compliant NERR was not likely to have disadvantaged the relevant employees was not open on the evidence before the Commissioner. The Commissioner had in fact been satisfied for a range of reasons, it was submitted, that there was not likely to have been disadvantage, including that the relevant employees had received the NERR and were likely to have understood that they would be covered by the 2021 Agreement, there was no suggestion that the employees who received the NERR did not understand it was relevant to them, at least three employees had exercised their representational rights, the CFMMEU had been an active participant in the bargaining together with two additional employees nominated as bargaining representatives, and any substantive changes in working conditions in the black coal mining industry as between the 2018 Agreement and the 2021 Agreement were the subject of bargaining between the parties with the involvement of the CFMMEU and the other bargaining representatives. Accordingly, FMS submitted, the premise in the CFMMEU's submission that the sole reason for the Commissioner's satisfaction under s 188(2) was the similarity in coverage is wrong.

[25] FMS submitted that permission to appeal should not be granted because the matter turns on its own facts, is distinguishable from each of the earlier decisions relied upon by the CFMMEU, and the decision was neither disharmonious with such decisions nor counter-intuitive.

[26] Ground 1 of the CFMMEU's appeal challenges the Commissioner's acceptance of the coverage undertaking pursuant to s 190 of the FW Act. Grounds 2 and 3 of the appeal challenge the Commissioner's finding that the 2021 Agreement met the "genuine agreement" requirement for approval in s 186(2)(a), which finding was in turn dependent on a preliminary finding that s 188(2) applied to the process for approval of the 2021 Agreement. The statutory provisions referred to all involve the exercise of a discretion because each is expressed in terms which indicate toleration of a range of permissible outcomes: s 190(2) provides that the Commission may approve an agreement by accepting an undertaking subject to the Commission's satisfaction as to the matters specified in s 190(3); s 186(2)(a) requires the Commission's satisfaction as to whether an enterprise agreement has been genuinely agreed; and s 188(2) applies if the Commission is satisfied as to the matters specified in paragraphs (a) and (b) of the subsection. Accordingly, the House v The King[8] or discretion standard of appellate scrutiny applies to all aspects of the CFMMEU's appeal.[9]

[27] In respect of grounds 2 and 3 of the appeal, we are not satisfied that the CFMMEU has advanced a sufficiently arguable case that the Commissioner erred in the exercise of her discretion in respect of ss 186(2)(a) and 188(2) such as to justify the grant of permission to appeal. We consider that it was on any view reasonably open for the Commissioner to conclude that FMS's failure to properly describe the coverage of its proposed agreement in the NERR was a minor procedural error which was unlikely to have disadvantaged the relevant employees. The statutory purpose of the NERR is to ensure that employees receive timely advice, in a prescribed form, concerning the rights conferred by s 176 of the FW Act for them to be represented by a bargaining representative in bargaining for a proposed agreement.[10] There was no substantive impairment in the achievement of this statutory purpose: all employees covered by the 2021 Agreement received the NERR; the NERR advised the relevant employees of their statutory representational rights in respect of the proposed agreement in the prescribed terms; at least some employees exercised their representational rights by nominating bargaining representatives; the CFMMEU in its capacity as a bargaining representative participated in the negotiation of the 2021 Agreement; and there was no evidence that the representational rights of any employee were in any practical sense diminished as a result of the error in the NERR. Accordingly, permission to appeal is refused in respect of appeal grounds 2 and 3.

[28] In respect of appeal ground 1, we do not consider that it was reasonably open for the Commissioner to conclude that the coverage undertaking proffered by FMS met her "concern" that the approval requirement in s 186(2)(a) was not met arising from her finding (not the subject of any cross-appeal or notice of contention) that FMS did not comply with s 180(5) in respect of its failure to explain the coverage term of the 2021 Agreement. The purpose of the requirement in s 180(5) for the employer to explain the terms of a proposed agreement and their effect is to enable the relevant employees "to cast an informed vote: to know what it is they are being asked to agree to and to enable them to understand how wages and working conditions might be affected by voting in favour of the agreement".[11] In order for an undertaking to "meet" - that is, address - a concern that an employer has not complied with s 180(5), in our view the undertaking must involve an adjustment to the terms of the relevant enterprise agreement to ensure that the identified statutory purpose can be said to have been achieved. In the Full Bench decision in OS MCAP,[12] the plurality identified the circumstances in which an undertaking might address non-compliance with s 180(5) as follows:

"[25] There clearly must be a logical relationship between the identified non-compliance with s 180(5) and the undertaking proposed to remedy it. For example, if the failure to take all reasonable steps to explain the terms of the proposed agreement and their effect consists of a misrepresentation concerning the benefits of the proposed agreement, then it is possible that this may be able to be addressed by an undertaking which serves to align the terms of the agreement with the representation. If there has been a failure to take all reasonable steps to identify or explain a term of the agreement which is significantly detrimental compared to the relevant modern award, then an undertaking may possibly address this by removing the detrimental term from agreement. In either case, of course, in order for the undertaking to be accepted the condition in s 190(3) must be satisfied - that is, the Commission must be satisfied that the effect of accepting the proposed undertaking is not likely to cause financial detriment to any employee covered by the agreement or result in substantial changes to the agreement. Further, even if that condition is satisfied, the Commission must be persuaded to exercise its discretion in favour of acceptance of the undertaking."

[29] The "logical relationship" will only exist if the undertaking is such as to overcome the effect of the non-compliance and ensure achievement of the statutory purpose of s 180(5). In the first example given in the passage from OS MCAP, the undertaking would alter the relevant terms of the agreement in a way that turns what was previously a misrepresentation about that term or its effect into a correct explanation of the term that complies with s 180(5). In the second example, the omission to explain a detrimental term of the agreement in breach of s 180(5) ceases to be an omission because the undertaking removes the detrimental term from the agreement.

[30] The coverage undertaking accepted by the Commissioner in no way addressed her finding as to non-compliance with s 180(5). The Commissioner's decision makes clear that the non-compliance consisted of a failure to explain to the relevant employees that if, in future, they were moved to a role covered by the Hydrocarbons Award, the 2018 Agreement rather than the 2021 Agreement would apply to them as a result of the change in the coverage term of the 2021 Agreement as compared to the 2018 Agreement. The coverage undertaking did not render this failure "moot", as the Commissioner found, because it did nothing to modify the position whereby the relevant employees did not have the benefit of the requisite explanation prior to deciding whether or not to vote to approve the 2021 Agreement. The Commissioner's conclusion that the provision of the requisite explanation after rather than immediately before the access period had "no practical bearing on the outcome of the vote, because ... [it] did not affect any of the employees in any material way" involves a misapprehension of principle: the purpose of the acceptance of an undertaking under s 190 is to meet a concern that an enterprise agreement does not satisfy the approval requirements in ss 186 and 187, not to allow a judgment to be made about the materiality or significance of the failure to satisfy those approval requirements and to waive or excuse it.

[31] Accordingly, we consider that the Commissioner erred in approving the 2021 Agreement on the basis of the coverage undertaking. It was not reasonably open for the Commissioner to be satisfied that the coverage undertaking which she accepted met her concern as to non-compliance with s 180(5). We grant permission to appeal in respect of appeal ground 1, and uphold that ground of the appeal.

[32] However, it does not follow from this conclusion that the decision should be quashed or that FMS's application for approval of the 2021 Agreement should be dismissed. There remains the question, not dealt with in the decision under appeal, as to whether the 2021 Agreement could be said to have been "genuinely agreed" as required by s 186(2)(a) by virtue of the application of s 188(2), notwithstanding the instance of non-compliance with s 180(5) identified by the Commissioner. In respect of this question, we accept the submission advanced by FMS in the appeal that s 188(2) applies. The instance of non-compliance with s 180(5) was clearly a procedural error within the meaning of s 188(2)(a), there being no suggestion that FMS deliberately intended not to explain the coverage provisions of the 2021 Agreement and thereby not comply with s 180(5).[13] In our evaluation, this error may be characterised as "minor" in nature for the purpose of s 188(2)(a). The explanation document and the agreement/award comparison tables otherwise comprehensively explained the terms of the 2021 Agreement and their effect in a way which is not the subject of any complaint or criticism by the CFMMEU. There was a failure to explain, in terms, that the 2021 Agreement, unlike the 2018 Agreement, did not cover work covered by the Hydrocarbons Award, but the explanation document and the comparison tables made it clear enough that the 2021 Agreement only provided for rates and conditions in respect of the five awards identified in clause 4.1. No person reading the explanation document or the comparison tables could reasonably conclude that the 2021 Agreement covered work covered by the Hydrocarbons Award. There was no express explanation that the effect of the change in coverage was that an employee performing work covered by the Hydrocarbons Award would be covered by the 2018 Agreement, but likewise there was nothing to indicate that the rates and conditions applying to such work under the 2018 Agreement had been changed by anything contained in the 2021 Agreement. Having regard to the totality of FMS's efforts to explain the terms of the 2021 Agreement and their effect, and the fact that the question of the performance of work covered by the Hydrocarbons Award was purely hypothetical and speculative since none of the relevant employees actually performs this work, the identified error is clearly of a relatively insignificant nature and therefore "minor".

[33] For similar reasons, we consider that the error was not likely to have disadvantaged the relevant employees. They would reasonably have understood from the explanation document and the comparison tables that the 2021 Agreement did not cover work covered by the Hydrocarbons Award, none of them actually performed this work anyway and the prospect that any of them might do so in the future was no more than hypothetical. Therefore there is no real possibility that the error could have affected the outcome of the vote or will cause any employee not to receive the employment entitlements they thought they were voting for.

[34] Accordingly, we consider that s 188(2) applies and, consequently, the "genuinely agreed" approval requirement in s 186(2)(a) is satisfied. The Commissioner's ultimate decision to approve the 2021 Agreement was therefore not in error, albeit we have identified error in the basis for her approval. The only step which needs to be taken in this appeal is to confirm the approval of the 2021 Agreement pursuant to s 607(3)(a) of the FW Act. There is no need to vary the decision to remove the coverage undertaking because, while it did not constitute a proper basis upon which to approve the 2021 Agreement, it was not contended by the CFMMEU that there was any error in the acceptance of the undertaking under s 190(3).

(1) Permission to appeal is granted in respect of appeal ground 1. Permission to appeal is otherwise refused.

(3) The decision of Commissioner McKinnon dated 16 November 2021 ( [2021] FWCA 6700) to approve the FMS Employee Agreement 2021 is confirmed.

[1] [2021] FWCA 6700

[4] [2021] FWCA 6700 at [6]

[5] [2020] FWCFB 3669

[6] [2021] FWCFB 4522, 308 IR 363

[7] [2019] FWC 1331

[8] [1936] HCA 40, 55 CLR 499 at 505

[9] Minister for Immigration and Border Protection v SZVFW [2018] HCA 30, 264 CLR 541 at [44], [49] per Gageler J; Jamsek v ZG Operations Australia Pty Ltd [2020] FCAFC 119, 279 FCR 114, 297 IR 210 at [168]

[10] See Peabody Moorvale Pty Ltd v Construction, Forestry, Mining and Energy Union [2014] FWCFB 2042, 242 IR 210 at [20]- [22]; RFFWUI v Woolworth Group Limited & Ors [2019] FWCFB 2355, 289 IR 214 at [33]

[11] One Key Workforce Pty Ltd v CFMEU [2018] FCAFC 77, 262 FCR 527, 277 IR 23 at [115]

[12] CFMMEU, AWU, AMWU and CEPU v OS ACPM Pty Ltd and OS MCAP Pty Ltd [2020] FWCFB 3669

[13] See Huntsman Chemical Company Australia Pty Limited [2019] FWCFB 318 at [73]

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