s.602 - Application to correct obvious error(s) etc. in relation to FWC's decision

Cragcorp Pty Ltd T/A Queensland Bridge and Civil

Queensland Bridge and Civil Enterprise Agreement 2019 - decision [2020] FWCA 859 - incorrect copy of agreement submitted for approval - agreement approved by Commission not voted on or made by employees - whether incorrect agreement constituted an irregularity for purposes of s.602.

[1] Cragcorp Pty Ltd (the Employer) has made an application under s.602 of the Fair Work Act 2009 (Cth) (the Act) for the correction of an irregularity in a decision to approve the Queensland Bridge and Civil Enterprise Agreement 2019 (the Agreement)[1] published on 18 February 2020.

[2] On 31 January 2020, the Employer made an application pursuant to s.185 of the Act for approval of the Agreement. The application was allocated to me. I wrote to the Employer on 13 February 2020, seeking an undertaking to overcome a concern I held. On 17 February 2020, the Employer provided a signed undertaking, and given there were no employee bargaining representatives, on being satisfied the undertaking met my concern, I approved the Agreement on 18 February 2020, with the Agreement to operate from 25 February 2020.

[3] On 12 March 2020, the Employer made the present application, stating the following about the order and relief sought:

"1. The Applicant seeks correction of an irregularity in relation to a decision to approve the Queensland Bridge and Civil Enterprise Agreement 2019 (Cragcorp Pty Ltd T/A Queensland Bridge and Civil [2020] FWCA 859 (18 February 2020)).

2. The application is made in accordance with section 602 of the Fair Work Act 2009.

3. The application seeks approval of the final version of enterprise agreement which was voted upon by the relevant employees. A copy of this agreement signed by the Employer and an employee representative is attached.

4. On 18 February 2020, Commissioner Hunt approved the Agreement submitted by the Applicant. However, the Applicant has since identified that an incorrect copy of the Agreement was submitted for approval to the Fair Work Commission ('FWC').

5. The enterprise agreement copy that was lodged with the application (F16) and declaration (F17) was not the final version which was voted upon by the relevant employees.

6. The lodging of the incorrect document was through inadvertence."

[4] I listed the matter for conference on 26 March 2020. At the conference I asked the Employer to consider seeking leave to appeal my decision to approve the Agreement, on the basis that it was now clear that I had approved an agreement that had not been made by the relevant employees. I suggested it might be a more prudent course of action to seek to appeal the decision, instead of pursuing this application, noting that the Employer would also need to seek from the Full Bench a further period of time to lodge the appeal as it was beyond 21 days from the date of my decision. Further, the Employer could make a fresh s.185 application seeking approval of the agreement made by the employees.

[5] Following the conference, the Employer made written submissions pressing this application, and in relation to whether the final version of the enterprise agreement passed the better off overall test (the BOOT).

[6] Section 602 of the Act provides:

"Section 602 Correcting obvious errors etc. in relation to the FWC's decisions

(1) The FWC may correct or amend any obvious error, defect or irregularity (whether in substance or form) in relation to a decision of the FWC (other than an error, defect or irregularity in a modern award or national minimum wage order).

Note 1: If the FWC makes a decision to make an instrument, the FWC may correct etc. the instrument under this section (see subsection 598(2)).

Note 2: The FWC corrects modern awards and national minimum wage orders under sections 160 and 296.

(2) The FWC may correct or amend the error, defect or irregularity:

• (a) on its own initiative; or

• (b) on application."

[7] The Act does not provide definitions for any of the terms: obvious error, defect, or irregularity.

[8] The application also concerns s.603 of the Act which provides:

"Section 603 Varying and revoking the FWC's decisions

(1) The FWC may vary or revoke a decision of the FWC that is made under this Act (other than a decision referred to in subsection (3)).

Note: If the FWC makes a decision to make an instrument, the FWC may vary or revoke the instrument under this subsection (see subsection 598(2)).

(2) The FWC may vary or revoke a decision under this section:

(ii) if the kind of decision is prescribed by the regulations - a person prescribed by the regulations in relation to that kind of decision.

(3) The FWC must not vary or revoke any of the following decisions of the FWC under this section:

• (a) a decision under Part 2-3 (which deals with modern awards);

(b) a decision under section 235 or Division 4, 7, 9 or 10 of Part 2-4 (which deal with enterprise agreements);

(c) a decision under Part 2-5 (which deals with workplace determinations);

(d) a decision under Part 2-6 (which deals with minimum wages);

(e) a decision under Division 3 of Part 2-8 (which deals with transfer of business);

(f) a decision under Division 8 of Part 3-3 (which deals with protected action ballots);

(g) a decision under section 472 (which deals with partial work bans);

(h) a decision that is prescribed by the regulations.

Note: The FWC can vary or revoke decisions, and instruments made by decisions, under other provisions of this Act (see, for example, sections 447 and 448).

[9] The Employer submitted that s.602 provides a power or facility for the Commission to correct or amend any obvious error, defect or irregularity whether in substance or form in relation to a decision of the Commission. The Employer said that the copy of the Agreement incorrectly lodged by the Employer was never approved by majority vote of the employees proposed to be covered by the Agreement.

[10] The Employer relied on the decision of Deputy President Beaumont in UGL Operations and Maintenance Pty Ltd [2018] FWCA 7445 (UGL) in support of its application. The Employer submitted that in that case, the Commission approved and published the copy of the agreement which had been submitted by the applicant, and the applicant subsequently identified that an incorrect, draft copy of the agreement had been submitted for approval, and not the final version which had been voted upon by the relevant employees. There were differences between the agreement published and the final version of the agreement.

[11] The Employer submitted that the Deputy President considered that these circumstances constituted an irregularity within the ordinary meaning of the word, and was harmonious with s.602 and with the performance of the Commission's functions under s.577.[2]

[12] In her decision, the Deputy President stated:

"...It is evident from the provisions in Part 2-4 that what is required to be filed for the purpose of s 185(2) is the enterprise agreement that has been 'made'. In this case, on 14 August 2018, the Applicant did not file the enterprise agreement that had been 'made', as that term is understood in s 182(1); the transgression is one where there is an evident irregularity."[3]

[13] The Employer submitted that the Deputy President also considered whether the irregularity was 'in relation to a decision' and determined that the phrase was sufficiently broad to permit a correction under s.602. The Employer said a broad interpretation of the term 'in relation to' as accepted by the courts in Woodside Energy Ltd[4] "will render the irregularity sufficiently proximate to a decision of the Commission as the enterprise agreement is inextricably connected to the decision already made by the Commissioner to approve the incorrect copy of the Enterprise Agreement other than in accordance with the Act."[5]

[14] The Employer submitted that for the purposes of the discussion regarding the interaction of s.603 of the Act, that s.602 does not prescribe that the decision in question must be a decision made under the Act. The Employer submitted it does not seek to vary or revoke the decision to approve the Agreement, but rather, as is contemplated in Note 1 of section 602, the Employer seeks to correct an irregularity in the instrument to which the decision of the Commission relates.

[15] The Employer submitted that s.603 of the Act excludes the power to vary or revoke a decision of the Commission that is made under the Act, a decision under section 235 or Division 4, 7, 9 or 10 or Part 2-4 which deal with enterprise agreements. The Employer submitted that this includes a decision to approve an enterprise agreement and the matters a decision must note. The Employer submitted that if s.603 is required to be considered, it does not apply to the decision to approve the Agreement as that decision was not made in accordance with the Act.

[16] The Employer submitted that the enterprise agreement to be approved was a single-enterprise agreement. The Employer said that for the purposes of Division 4, a single-enterprise agreement is defined as "an enterprise agreement made as referred to in subsection 172(2)".

[17] It was submitted that s.172(2) outlines the minimum requirements for making a single-enterprise agreement and refers to the definition under s.12 of the Act which provides that the term 'made', in relation to an enterprise agreement, is defined as having the meaning prescribed by section 182 of the Act that an agreement is made when a majority of employees who cast a valid vote approve the agreement. The Employer contended that the draft agreement submitted by the Employer, and approved by the Commission, was not the agreement made by the parties in accordance with section 182 of the Act.

[18] It was submitted that a determination as to whether an agreement has been made in accordance with s.182 is an objective fact, and not a decision of the Commission. The Employer said that the decision of the Commission to approve the copy of the Agreement submitted by the Employer for approval was not a decision made under the Act because only an enterprise agreement made by the parties can be approved under Division 4.

[19] The Employer also submitted that the limitations imposed by s.603(3) of the Act are intended to limit the Commission's powers in relation to disputes which may arise as to the merits of a decision to approve an Agreement which was made by the Commission in accordance with the Act, and are not intended to prevent the Commission from exercising its powers under s.602(2) of the Act to correct an irregularity.

[20] In the present application the Employer provided a copy of the final version of the agreement that it stated was made with employees covered by the Agreement, but not earlier provided to the Commission. The Employer submitted that the final version satisfies the BOOT and does not require undertakings further than those provided with the lodged agreement. The Employer helpfully outlined the differences between the final version and the one approved in the decision.

[21] It is evident that there are four clauses where there are differences between the document filed in the Commission and ultimately approved, and the final version which was put before employees and voted upon. The differences between the two documents are underlined below:

This Agreement will apply to the Employer and to their employees engaged in the classifications contained in this Agreement engaged in the Employer's civil construction works.

This Agreement will apply to the Employer and to their employees engaged in the classifications contained in this Agreement engaged in the Employer's civil construction and maintenance and mechanical maintenance and engineering works.

The reference to 'maintenance and mechanical maintenance and engineering works', on enquiry, is a legacy of the previous agreement and relates solely to works incidental to civil construction works as defined in the agreement.

The Employer does not employ any employees primarily in the performance of mechanical maintenance and engineering works, nor does the Employer provide such services. Therefore, this difference between the two Agreements neither extends the application to any other Modern Award nor to any additional class of employee.

The Employer, therefore, submits that the final version agreement does not require additional testing to that already conducted.

It is a requirement to wear and maintain personnel protective equipment (PPE) and safety equipment while in areas requiring such equipment. All of the Employer's sites have a mandatory PPE requirement. All employees shall adhere to all processes, policies and regulations whilst working on project sites.

All employees will receive an annual allowance of up to a maximum of $150.00 after six (6) months qualifying period and annually thereafter, to reimburse the cost of approved Australian standard safety boots. A copy of the purchase receipt shall be sent to payroll for approval and reimbursement.

It is a requirement to wear and maintain personnel protective equipment (PPE) and safety equipment while in areas requiring such equipment. All of the Employer's sites have a mandatory PPE requirement. All employees shall adhere to all processes, policies and regulations whilst working on project sites.

All employees will receive an annual allowance of up to a maximum of $150.00, to reimburse the cost of approved Australian standard safety boots. A copy of the purchase receipt shall be sent to payroll for approval and reimbursement.

This allowance will be payable on completion of the probation period, and thereafter on each anniversary of the completion of probation date.

In the event that an employee resigns from employment within six (6) months of receiving the allowance, the employee subject to the Fair Work Act 2009 (Cth), will be liable for 50% of the allowance as a debt due to the Employer.

The quantum of the allowance is unchanged. Further, this entitlement was not subject to the BOOT analysis in the authority for Construction Sector enterprise agreements (CFMMEU v Allstyle Concrete [2018] FWCFB 3823). The Employer, therefore, submits that the provisions of the final version agreement will not affect the BOOT.

Further and/or in the alternative, where the FWC considers that provision is unreasonable in the circumstances, the Employer submits that the Act operates such that the provision will have no effect. No further action in respect of this application will be required.

In the circumstances an employee engaged on shift work is required to work in excess of 9.5 hours, Monday to Friday, a crib allowance of 20 minutes at the employee's double time rate will be paid.

The final version agreement has an additional monetary entitlement to satisfy BOOT.

Shift work / night work meaning where the majority of ordinary hours are worked outside of the ordinary span of hours may be worked to suit the requirements of a project.

An Afternoon Shift is defined as a roster whereby the ordinary hours of work commence between 10.00am and 8.00pm.

A Night Shift is defined as a roster whereby the ordinary hours of work commence between 8.00pm and 6.00am.

Day work (i.e. work commencing between 6.00am and 10.00am) is not shift work.

• Where less than five (5) continuous afternoon or nights or a rostered 38 hours per week are worked, a 40% loading shall apply on the ordinary hours of work only;
• Where more than five (5) continuous afternoon or nights or more per week are worked, a loading of 30% shall apply on the ordinary hours of work only.

All overtime (i.e. in excess of 38 hours) worked by shift workers, Monday to Friday will be paid at the rate of double time. The overtime penalties prescribed in Clause 7.2 shall apply to all hours worked on shift work on a Saturday or Sunday.

Shift work / night work meaning where the ordinary hours are worked outside of the ordinary span of hours to suit the requirements of a project.

An Afternoon Shift is defined as a roster whereby the ordinary hours of work commence between 10.00am and 6.00pm.

A Night Shift is defined as a roster whereby the ordinary hours of work commence between 6.00pm and 6.00am.

Day work (i.e. work commencing between 6.00am and 10.00am) is not shift work.

A loading of 30% will apply to the employee's ordinary rate when engaged on shift work, Monday to Friday.

All overtime (i.e. in excess of 38 hours) worked by shift workers, Monday to Friday will be paid at the rate of double time. The overtime penalties prescribed in Clause 7.2 shall apply to all hours worked on shift work on a Saturday or Sunday.

This Agreement will apply to the Employer and to their employees engaged in the classifications contained in this Agreement engaged in the Employer's civil construction works.

The final version agreement has extended the night shift span correspondingly with the reduction to the afternoon shift span.

The shift loading of the final version agreement has been tested against BOOT analysis for Construction Sector enterprise agreements (CFMMEU v Allstyle Concrete [2018] FWCFB 3823) and satisfies the BOOT. The spreadsheet calculations to support this submission are attached in the covering email for these submissions.

[22] It is clear that there has been an error by the Employer in that the wrong agreement was lodged with the Commission by the Employer. I am satisfied that the approved Agreement is not that which was made by the employees with the Employer, and regrettably, it was a draft agreement lodged with the Commission and ultimately approved.

[23] The case relied upon by the Employer, UGL, appears to be analogous to this matter. An incorrect agreement was lodged with the Commission which was approved subject to undertakings. The error was later identified and an application under s.602 was brought.

[24] In her decision, the Deputy President stated (my emphasis):

"[9] The test one asks is whether it was the purpose of the legislation, in this case the Act, that an act done in breach of a provision should be invalid.[6] While it is true that the incorrect copy of the Agreement was filed, it is evident that for the purpose of s 185(1) and s 182(1) the Applicant and the relevant employees had made an enterprise agreement. It is therefore difficult to conceive a circumstance where the legislature would seek to frustrate the agreement reached by the 'parties', in a situation such as this. This is particularly the case when one considers s 577 and the object of the Act.

[13] Under s 602(2) the Commission may correct the irregularity on its own initiative or on application. I have concluded there is an irregularity in relation to a decision of the Commission. While the Applicant's application referred to an obvious error in relation to a decision of the Commission, I consider that I am permitted under s 602(2) to nevertheless to correct the irregularity. An order[7] will be issued concurrently with this decision to the effect that the Agreement published on 6 December 2018[8] will be replaced with the Final Version of the Agreement inclusive of the undertakings."

[25] The Applicant has submitted that the decision of the Commission to approve the copy of the Agreement submitted by the Applicant for approval was not a decision made under the Act because only an enterprise agreement made by the parties can be approved under Division 4.

[26] With respect, I am not able to come to the same conclusion as the Deputy President in UGL. In my view, s.603(3) makes it very clear that the Commission is unable to vary or revoke a decision which falls under Division 4 of Part 2-4 (which deals with enterprise agreements), and in this case, includes applications under s.185 of the Act.

[27] I consider that parliament has made it clear that in the event an agreement is approved, the decision to approve is protected other than by way of obtaining leave to appeal. Whilst I appreciate that in the matter before me, the Employer has not requested the Commission vary or revoke the decision to approve the Agreement, I consider that it is the effect of the application made. Essentially, the Employer requests the Commission make a decision that has the effect of no longer approving the agreement that was earlier put before the Commission, and instead, approve the agreement that was made by the employees when they voted for the agreement.

[28] I do not accept that there is power under s.602(1) to give effect to what it is the Employer wants to happen. If there is any obvious error, defect or irregularity in relation to the decision made by me to approve the Agreement, it is that the agreement put to the Commission for approval was one that was never made by the Employer and its employees.

[29] I am unable to conclude that correcting or amending my decision approving the Agreement can remedy this troubling issue. To do so would have the effect of determining that the Agreement approved by me can be substituted by the agreement made by the employees, and it would require a further consideration within this s.602 application of the BOOT. I am not satisfied that there is any power to do what is asked of the Commission, even having regard to Note 1 below s.602(1) referencing s.598(2).

[30] Section 598(2) of the Act provides:

"If the FWC makes a decision that makes or varies an instrument, a reference in this Part to a decision of the FWC includes the FWC's decision to make or vary the instrument in the particular terms decided."

[31] Whilst I appreciate that the approval of an agreement is the effect of making an instrument under the Act, I am troubled by the submission that the agreement that was properly made by the employees with the Employer, which should have been put for approval, be simply substituted by the Agreement that was approved by the Commission. To give effect to the Employer's application, it would require a further consideration of the agreement made by the employees and the Employer, having regard to the BOOT. This exercise is not at all contemplated by s.602(1). There is no ability or power to do a re-run.

[32] If, for example, further undertakings were required to satisfy the BOOT, when would those undertakings apply? From when the Agreement operated from 25 February 2020, or from the date of this decision? I do not consider it possible to simply replace the Agreement with the agreement that was made with the employees.

[33] Another consideration is the finality of decision making. If this particular application had not been allocated to me, and instead had been allocated to another member of the Commission, I'm uncomfortable with the position that another single member should correct or amend what it said to be an obvious error, defect or irregularity in a single member's decision; this is, respectfully, the domain and responsibility, with due consideration, of a Full Bench.

[34] I appreciate the inappropriateness of the Agreement continuing to operate, when it should not. It is recommended the Employer urgently seek leave to appeal the decision approving the Agreement, while at the same time making application for approval of the agreement made with the employees.

[35] The Employer could respectfully request, in the two applications it is suggested it make, for the Full Bench to deal with both applications.

[36]

For the above reasons, the application is dismissed.

[1] AE507120 [2020] FWCA 859.

[2] UGL Operations and Maintenance Pty Ltd [2018] FWCA 7445 at [8].

[4] Woodside Energy Ltd (ABN 63 005 482 986) v Commissioner of Taxation for the Commonwealth of Australia; Workers' Compensation Board (Qld) v Technical Products Proprietary Limited [1988] HCA 49; O'Grady v North Queensland Company Limited [1990] HCA 16.

[5] Applicant's Outline of Submissions, 27 April 2020 at [8].

[6] Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, 390-391.

[8] [2018] FWCA 7445.

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