The company, the EEASA (intervening), the AFMEU, AWU - FIME, ALHMWU and the EEPAWU were represented. I found that each of the unions were entitled to be heard pursuant to s.170NB of the Act, with each of the unions in question being bound by both of the relevant awards.

In its submissions, supported by the EEASA, the company submitted that the requirements of Divisions 3 of Part VIB of the Act had been met and the agreement should be approved. The unions submitted that the agreement should not be approved on the basis of the following provisions of the Act:

. s.170NC.(1)(d); . s.170NC.(1)(g), (h) and (i) in that the documentation provided to employees was such that they had not been properly consulted and had not genuinely agreed to the terms of the agreement; . s.170ND.(3); . s.170ND.(7) in respect of AWU - FIME and the AFMEU; and . s.170NG.

A general examination of the relevant tests of Division 3 of Part VIB of the Act is set out in the decision of Vice President Ross in IOF Modular Offices [Print L3367 [I0139]] on pages 3 to 6. No purpose is served by repeating them in this decision. It remains necessary however to apply the relevant statutory tests to the Arrowcrest Group Pty Ltd (Woodville North) Enterprise Bargaining (Pay Increase and Long Service Leave Conditions) Agreement 1994.

The original instrument of agreement provided was in the form of a summary document provided to employees for the purpose of a ballot. I required the company to amend the instrument of agreement to fully reflect the terms of the agreement proposed. The agreement contains five provisions:

1. Subject to the Australian Industrial Relations Commission approval,

a wage increase of 3.5% from the first pay period after the ballot of employees, a further wage increase of 4.0% on the first pay period commencing in January 1984 and changes to long service leave as set out in an appendix (essentially to reflect more favorable provisions within South Australian legislation). 2.
Specified changes in employment conditions:

Clause (2a);provision that when an employee takes unpaid leave of

absence without company approval an employee will not be eligible to be paid overtime rates during that week until they have made up the lost time on ordinary time pay rates;

Clause (2b);provision for an employee, at their request and with company agreement, to exchange half of the leave earned in any twelve month period for a payment equal to what

would have been received if leave had been taken (including annual leave loading);

Clause (2c);provision for voluntary attendance or training sessions conducted by or for the company outside of normal working hours to be paid at ordinary time rate;

Clause (2d);a requirement that all employees wear an identity card whilst on company property; and

Clause (2e);confirmation of measures agreed upon in an earlier unregistered agreement, as set out in an appendix.

5. A period of operation of the agreement (until 31 December 1995).

In support of its application the company relied on the statutory declaration of Mr A.M. Gleeson, General Manager, Human Resources of the Arrowcrest Group, which was filed pursuant to Rule 30G of the Act, evidence of Mr Gleeson, supported by a range of documentary material, evidence of three members of the consultative committee through which the agreement was negotiated (two employee representatives and one management representative) and evidence of a Vietnamese speaking employee utilised to communicate with Vietnamese speaking members of the workforce. At the request of the AFMEU, the company also provided copies of those sections of minutes of each consultative committee meeting which dealt with the negotiation of the agreement. It is fair to say that collectively that material provided a very detailed basis upon which the requirements of the Act, as applied to the Arrowcrest agreement could

The union submissions were more general in their nature. No evidence was led by them, although reliance was placed on aspects of the evidence of company witnesses on opposing the application.

Application of the relevant statutory tests to the Arrowcrest agreement

The provisions of the Act upon which the unions rely to oppose the application are set out above. In applying the relevant statutory tests to the agreement I will deal first with those provisions where no contest exists

between the parties and then deal with those provisions which are contested. Uncontested issues

On the basis of all the material before me I am satisfied as to the following matters:

The applicant is a constitutional corporation within the meaning of the Act carrying on an enterprise to which the agreement applies.

The agreement applies only to the enterprise and is only about matters relating to the employment relationship.

Wages and conditions of the employees covered by the agreement are regulated by awards of the Commission; the Metal Industry Award

The agreement covers all employees performing work in the

enterprise in respect of whom wages and conditions of employment are regulated.

The agreement, in clause 3, contains a dispute settlement procedure within the meaning of (s.170NC.(1)(e)).

6. The agreement, in clause 4, contains a consultative process within the meaning of (s.170NC.(1)(f)(i)).

7. The agreement, in clause 5, specifies the period of operation of the agreement.

There are no matters arising under s.170ND.(1), s.170ND.(2), s.170ND.(5), s.170ND.(10) which would lead me to refuse to approve the implementation of the agreement.

"s.170NC.(1) On an application to the Commission to approve implementation of an agreement, the Commission must do so if, and must not do so unless, it is satisfied that:

(g) during the negotiations for the agreement, reasonable steps were

taken to consult employees who are covered by the agreement about the agreement; and

(h) before the application for approval was made, reasonable steps were taken:

(i) to inform the employees who are covered by the agreement about the terms of the agreement; and

(ii) to explain to those employees the effect of those terms; and

(iii) in particular, to explain to those employees the procedures referred to in paragraph (e); and (iv) to inform those employees of the intention to apply to the Commission to approve implementation of the agreement, and about the consequences of approval; and

(i) a majority of the persons who, as at the end of a day that is specified in the application and is not more than 7 days before the

day when the application was made, were employees covered by the agreement have, on or before the specified day, genuinely agreed to be bound by the agreement, even if they so agreed at different times;"

The unions submitted that these requirements of the Act were not met on the basis that the vote of employees on 12 May 1994 which, by majority, approved the agreement was based on a document containing a summary of the agreement; that there existed a lack of understanding amongst employees as to the terms of the agreement; and that the vote on 12 May 1994 did not constitute genuine approval. The company relied on extensive evidence to rebut these claims.

Having regard to all of the material on this issue I am satisfied that the requirements of each of these sections of the Act has been met. I have reached this conclusion for the following reasons:

. The evidence demonstrates that during the negotiations, reasonable steps were taken to consult employees covered by the agreement. Verbal evidence and the consultative committee minutes demonstrate

to my satisfaction that the consultative committee, through which the agreement was negotiated, took extensive steps to communicate with the workforce generally in terms of both seeking input into the agreement and communicating the terms of the agreement negotiated.

. The evidence also demonstrates to my satisfaction that employees

were fully informed both by documentation and communication with consultative committee members on the terms of the agreement and their effect, including the disputes settlement procedure and of the intent to apply to the Commission to obtain approval of implementation of the agreement.

. A vote was conducted on 12 May 1994 at which a majority of employees, within the required time period with the Act, genuinely

agreed to the agreement. It is true that the document provided to employees before that vote was in summary form but I am satisfied that the terms of that document, together with earlier documentation provided to the workforce and the process of feedback between the consultative committee and employees, was such that the employees understood and genuinely approved the agreement. I am satisfied on the evidence that the vote was properly undertaken and that the vote reflected a genuine expression of the majority view of the company workforce.

. The unions were able to point to evidence, in the form of employee witness evidence and consultative committee meetings that there was, at one stage, a lack of adequate understanding of the agreement, which led to the rejection of an earlier proposed agreement on 22 April 1994. However, the evidence demonstrates, to

my satisfaction, that any lack of understanding at the time of that vote was recognised by the consultative committee which then took appropriate steps, including attempts to ensure that consultative committee members communicated directly with all employees to overcome any lack of understanding, to ensure a proper level of understanding of the agreement - its terms and effects - before the 12 May 1994 ballot. There is no evidence which indicates an

inadequate understanding of the agreement by employees at the time of the 12 May 1994 vote.

AFMEU opposition to approval of the agreement on the basis of s.170ND.(3) relied upon the alleged effects of the provision within the agreement concerning the cashing out of annual leave as constituting "exceptional circumstances". In my view, matters raised by the AFMEU at this point are appropriately considered in the context of s.170NC.(1)(d) and do not, in themself, constitute exceptional circumstances upon which I should refuse to approve the agreement in the context of the current matter.

In support of its application, the company put submissions and evidence that, in the negotiation of the agreement, care had been taken to ensure that the interests of relevant employees were appropriately considered. The unions contested this submission submitting that no efforts had been made to identify and reflect the needs of persons whose first language is not English, women and young people.

I am satisfied on the material before me, including responses to my own inquiries of the company, that relevant employees, within the meaning of s.170NG, were consulted and informed about matters referred to in s.170NC.(1)(h)(i), (ii), (iii) and (iv) in ways which were appropriate to their needs and circumstances and that they had the effect of the agreement properly explained to them. I have reached this conclusion having regard to the evidence of extensive communication between the consultative committee and the workforce generally, representation of relevant employees on the consultative committee, albeit not specifically as "relevant employees", the processes adopted to communicate with employees whose first language is not English

• an issue specifically considered by the consultative committee, resulting in translation of documents into Vietnamese and the considered use of a "buddy system" to communicate with such employees in their first language - and the process whereby the consultative committee sought inputs into negotiations from all employees, providing all employees an opportunity to have matters relevant to

their particular needs and circumstances considered. Further, there is nothing in the agreement which suggests to me that any employee or group of employees would be discriminated against, as reflected in my earlier finding in relation to s.170ND.(10).

The company submitted that each element of the agreement is consistent with the requirements of s.170NC.(1)(d). The unions submitted that three elements of the agreement offended that requirement: Clause 2(a)

"When an employee takes unpaid leave of absence without the Company's approval the employee will not be eligible to be paid overtime rates during that week until they have made up the time lost at ordinary time pay rates.

For the purpose of this point 'unpaid leave of absence without the Company's approval' will include any leave which was not approved in advance and which is not approved under the terms of the appropriate industrial Award.

Absences for approved leave such as annual leave, public holidays, sick leave, bereavement leave and special leave will be treated as ordinary time worked for the purpose of calculating the 7.6 hours each day."

"At the employee's request and with the employer's agreement up to one half of the annual leave accrued in any twelve month period may be exchanged for a payment equal to the amount that would have been received if annual leave was taken. This payment will also include relevant annual leave loading."

"Employees will accept the need for increased flexibility in the taking of annual leave by recognising that on some occasions as a consequence of work demands it may be necessary to return early from leave. On such

occasions it will be agreed that the leave already taken will be recognised as having been finished and cannot be taken again. Similarly, if any employee requests to be allowed to return to work before their planned annual leave break has expired and if that request is granted it shall be agreed that the leave already taken has finished and cannot be

There is no dispute as to other elements of the agreement. Having considered each of the other elements I am satisfied that they do not disadvantage employees within the meaning of s.170NC.(2).

It is necessary however to further consider each of the disputed issues against the terms of s.170NC.(2) which states:

"For the purposes of paragraph (1)(d), an agreement is taken to disadvantage employees in relation to their terms and conditions of employment only if:

(a) approval of implementation of the agreement would result in the reduction of any entitlements or protections of those employees under:

(ii) any other law of the Commonwealth or of a State or Territory that the Commission thinks relevant; and (b) in the context of their terms and conditions of employment considered as a whole. the Commission considers that the reduction is contrary to the public interest."

The relevant awards each provide for payment of overtime at penalty rates. As such the terms of clause 2(a) do result in the reduction of entitlements or protections under an award as defined in s.170NC.(3). Accordingly, it is necessary to consider whether, in the context of the terms and conditions of employment as a whole, the reduction is contrary to the public interest. I have concluded that in the context of the total terms and conditions, the reduction in this award entitlement is not contrary to the public interest. In my view the reduction in the award entitlement has to be seen in the context of the benefits to employees within the agreement of wage increases of 3.5% and 4.0%, together with improvements in long service leave benefits. Further the terms of clause 2(a) are limited in their effect relating to overtime worked following an unauthorised absence in the same week and to the extent of the duration of that absence.

The company provided information indicating that the likely incidence of application of clause 2(a), based on the experience of the last six months, wherein overtime was worked by employees the weekend following an unauthorised absence on only 18 occasions in the context of a workforce in the order of 400 employees. In my view the incidence of application of clause 2(a) is likely to be so limited that, in the context of the total agreement, the reduction in award entitlements is not contrary to the public interest.

My only qualification, in reaching this conclusion was the potential for the company to unreasonably refuse leave in order to engineer greater overtime at ordinary time rates. However, the company submitted that this is not intended and it is prepared to give an undertaking that the company will not unreasonably refuse requests for leave, paid or unpaid, and that any grievance in this respect will be dealt with through the dispute resolution procedure in clause 3 of the agreement. In those circumstances there is no basis for that qualification.

The terms of this clause provide a capacity for any employee on a voluntary basis, and subject to the consent of the employer, to "cash out" one half of their annual leave entitlement. Clause 25 of the Metal Industry Award 1984 - Part I provides:

(a) A period of 28 consecutive days' leave, including non-working days, shall be allowed annually to an employee after twelve months continuous service (less the period of annual leave) as an employee on weekly hiring in any one or more of the occupations to which the award applies.

An employee on weekly hiring shall accrue annual leave at a rate of 2.923 hours for each 38 ordinary working hours worked."

and "Leave to be taken

(g) The annual leave provided by this clause shall be allowed and shall be taken and except as provided by subclauses (l) and (m) hereof payment shall not be made or accepted in lieu of annual leave."

Subclause 25(l) provides for proportionate leave on termination. Subclause 25(m) deals with annual close down.

The Vehicle Industry Award 1982 in clause 26 contains annual leave provisions to the same effect as those noted above.

These provisions are common in awards of this Commission. They provide not only an entitlement to four weeks annual leave but also a prohibition on the cashing out of the leave entitlement, except as provided for in relation to termination and annual close-down. The award provision as a whole reflects a clear intention that leave is provided for the purpose of taking leave. The benefit is in the form of leave from work duties.

In my view clause 2(a) of the agreement does, in terms in s.170NC.(2)(a) constitute a disadvantage to employees. The company argued that because the cashing out of a proportion of annual leave is voluntary it does not diminish an employee's entitlement to annual leave. However, the entitlement in the relevant awards is clearly one of an entitlement to annual leave to be taken as leave (other than in the context of the termination or annual close down provisions of the annual leave clause) prohibiting the acceptance, whether voluntary or otherwise, of payment in lieu of leave. Further, s.170NC.(2)(a) refers to "entitlements and protections", with clauses such as, subclause 25(g) of the Metal Industry Award 1984 - Part I intended to protect leave in the form of leave, consistent with the purpose of annual leave entitlements.

It becomes necessary to consider whether clause 2(b) of the agreement constitutes a disadvantage in terms of s.170NC.(2)(b). The company submitted that this test should be considered in the context of the objects of the Act as reflected in the IOF decision [Print L3367] at page 4:

"The Commission must, as far as practicable, perform it's functions under Part VIB in a way that furthers the objects of the Act and, in particular, the objects of Part VIB. Section 170LA(i) provides that the objects of Part VIB are:

(i) the making and certifying of agreements under Division 2; and

(ii) the making, and approval of the implementation of, agreements under Division 3; and

(b) to encourage the use of agreements, particularly at the workplace or enterprise level."

The company is correct in pointing to the necessity to give effect to the objects of the Act. However, the object in s.170LA.(1)(a)(ii) is to facilitate

"the making, and approval of the implementation of, agreements under Division 3". The object involves facilitating and approving agreements in the terms of the statutory requirements of Division 3. Thus the requirement to give effect to the objects of the Act does not relieve the applicant of the burden of satisfying the statutory requirements of Division 3, including s.170NC.(2)(b).

Notwithstanding benefits to employees arising from other elements of the agreement, the particular nature of clause 2(b), which involves a capacity to diminish the entitlement to annual leave in the form of leave, does raise a consideration which leads me to conclude that the reduction in terms of s.170NC.(2)(d) is contrary to the public interest. Specifically, I have concluded that the provision in the agreement which permits the trading off of leisure entitlements for monetary gain raises public policy issues and is contrary to legislative intent in that it diminishes an entitlement of the nature of a community standard. I have concluded, in those circumstances, the disadvantage arising out of clause 2(b) is contrary to the public interest.

I have reached this conclusion for the following reasons.

The no disadvantage test is intended to protect well established and

accepted community standards. In the course of his second reading speech of the Industrial Relations Reform Bill 1993, the Minister made the following observation in relation to the operation of the "no disadvantage" test:

"Two forms of agreements are provided for - certified agreements and enterprise flexibility agreements. Both types of agreements must not disadvantage employees in relation to their terms and conditions of employment considered as a whole. To gain access to these agreements,

employees' terms and conditions of employment must be covered by an award, providing the benchmark for the no disadvantage test.

The no disadvantage test has been an important innovation. Applying as it does to the overall package of employee entitlements, it allows for a wide range of variations to award conditions. It also allows for agreed reductions if these are judged not to be against the public interest, for example, as part of a strategy for dealing with a short-term business crisis and revival. However, as the government has consistently stressed, the provision is intended to protect well established and accepted standards which apply across the community, standards such as maternity leave, hours of work, parental leave, minimum rates of pay, termination change and redundancy provisions and superannuation." [House of

Representatives, Hansard 28 October 1993 page 2781] [Emphasis added]

In my view, the provision of four weeks annual leave to be taken as leisure time (other than the limited exceptions reflected in the Metal Industry Award 1984) constitutes a well established and accepted community standard. Although the Minister did not specifically list annual leave in the passage from his second reading speech above, that listing was not exhaustive. I believe that it does constitute a standard of the kind referred to by the Minister. This view is supported by the 1991 Review of Wage Fixing Principles decision [Print K9700] at pages 35 and 36 which describes annual leave as a commission standard. One condition of the enterprise awards principle is that:

"(f) the proposed award does not result in a reduction in ordinary time earnings, or departures from parental leave and termination change and redundancy standards, determined in test case proceedings and Commission standards of hours of work, annual leave with pay of long service leave with pay;" The issue of cashing out of leisure time entitlements arose in a decision

at the Industrial Commission of New South Wales in court session (re Bakers (Cumberland) Consultative Committee and others 20 IR 152). It arose in the context of a completely different legislative framework and different factual circumstances and is, therefore, not directly relevant. However, the decision is relevant to the extent that members of the Commission raised issues of public policy in refusing an application which would have had the effect of exchanging leisure time for payment in lieu. The President, Fisher J noted:

"The true intention of the parties is that the additional 10 days or 12 days annual leave will not be taken as such, but will be paid out in cash. It was said in the event, inferred to be unlikely, that if someone made a sufficient nuisance of himself to actually want the extra leave as leave it would be permitted.

If this leave is considered to be similar to annual leave as originally submitted, a combination of s 3(5) and s11, 'Penalty', of the Annual Holidays Act makes it clear that with respect to statutory annual holidays, the arrangement to cash-out the benefit would be an offence. In terms of public policy this 'leave' appears to be in no better case. Cashing out industrial amenities used to be contrary to union principles and it still is contrary to the principles of this Commission."

The company referred me to a decision of a Full Bench in the Queensland Industrial Relations Commission (No. B87 of 1993; Bond University Staff Services Pty Ltd and The Bond University General Staff Association) on the basis that it had approved in the context of the making of a new award, the following provision:

"5.1 (6) At the request of the employee, a proportion of accrued annual leave in excess of four weeks may be taken in money in lieu of leave. Only 30% of the accrued entitlement may be paid out in this manner, the remainder to be taken as leave."

That provision was approved on the basis of the specific circumstances of that matter, including the fact that such a provision had operated since the inception of the university; a factor not present in relation to Arrowcrest. Further the provision is in very different terms in that it allows the voluntary partial (30%) cashing out of accrued leave entitlements in excess of four weeks, whereas clause 2(a) of the Arrowcrest agreement allows the voluntary cashing out of current year entitlements. Whilst the Bond provision was approved in the terms sought, the Full Bench noted:

"The commission approves the provision in the form sought because it has been in that form since inception. However, the Commission has some

reservations with the wording as it could result in an employee continually cashing in annual leave beyond the accrual of 40 days and not taking annual leave. It is not the intention of the Commission that this should occur and indeed the Commission strongly counsels against this occurring as it would negate the purpose for granting of annual leave and

be to the detriment of the employees concerned." [page 4]

In doing so, it counselled against the operation of the provision in a manner which negated the purpose of the granting of annual leave. In my view the provision sought in clause 2(b) of the Arrowcrest agreement would have that effect - of negating the purpose of granting annual leave. I have concluded that the public policy issues which arise in relation to clause 2(b) are such that the disadvantage to employees is, in the context of the total package, contrary to the public interest. I will deal later in this decision with the options available under s.170NF.

Clause 7 makes provision for an early return to work from leave. This was said by the AFMEU to constitute a disadvantage pursuant to s.170NC.(2) in that the wording allowed an employee to be compelled to return early from leave. No specific provision of the relevant awards was relied upon to establish the disadvantage. The company argued that it was intended that an employee be

compelled to return early from leave - that early return would be by agreement

• and was prepared to give an undertaking to that effect. I am unable to identify a provision of one or both relevant awards containing provisions which would cause clause 7 of Appendix B to constitute a disadvantage in terms of s.170NC.(2)(a).

Both the AWU - FIME and AFMEU argued that the requirements of s.170ND.(7) had not been met by the company in respect of their organisation as an eligible union. The EEPAWU and ALHMWU did not rely on any failure by the company pursuant to s.170ND.(7) in relation to them.

"(7) Despite section 170NC, the Commission may refuse to approve implementation of an agreement, or may adjourn an application to approve such implementation, if satisfied that the employer:

(a) did not, before or as soon as practicable after the time when negotiations for the agreement began, notify

each organisation that was at that time an eligible union about the negotiations; or

(b) did not give each such organisation a reasonable opportunity to take part in the negotiations and to agree, before the application for approval was made, to be bound by the agreement."

Section 170ND.(7)(a). The evidence before me indicates that Mr Gleeson,

General Manager Human Resources, was aware of the provisions of s.170ND.(7) sometime in March 1994. S.170ND.(7) commenced on 30 March 1994. The evidence also discloses that the company was aware that the AWU - FIME had knowledge of the enterprise bargaining negotiations at Arrowcrest sometime in late February or March, certainly before 28 March 1994, as a result of discussions about the negotiations between Mr Gleeson and Mr O'Dea (joint branch president AWU - FIME). The company knew the union had knowledge of the negotiations before s.170NC.(7) was proclaimed. Whilst I find that the company did not notify the AWU - FIME of the negotiations, I also find that there was no purpose in such notification of the AWU - FIME in those circumstances. It would not be appropriate to adjourn or refuse approval of the agreement on the basis of the company failure to notify the AWU - FIME of the negotiations in those circumstances. Section 170ND.(7)(b). The evidence shows that there were negotiations between the company and the AWU - FIME. In addition to the discussions noted above, meetings between the company and AWU - FIME occurred on 21 and 27 April 1994 and 4 May 1994. In addition the evidence indicates that telephone conversations occurred between Mr Gleeson and Mr O'Dea on the issue of the agreement. Mr O'Dea met with the consultative committee on 6 May 1994. On 4 May 1994 Mr O'Dea sent to Mr Gleeson a copy of a resolution of his members seeking certain variations to the proposed agreement. On 5 May 1994 the company responded accepting some of the proposals by the union, including a lengthening of the agreement and inclusion of the second wage increase. The series of discussions and correspondence was clearly addressed to the terms of the proposed agreement and resulted in some substantive amendments to the agreement. AWU - FIME had an opportunity to become a party to the agreement as amended following communication between it and the company. In these circumstances, I am satisfied that AWU - FIME was afforded a reasonable opportunity to take part in negotiations and to be bound by the agreement.

Accordingly, I have concluded that no grounds arise in respect of s.170ND.(7) as it applies to the AWU - FIME which would warrant refusal or adjournment of the application.

Section 170ND.(7)(a). The evidence before me indicates that Mr Gleeson was aware of the provisions of s.170ND.(7) sometime in March 1994. S.170ND.(7) commenced on 30 March 1994. There is no evidence to suggest that the company

was aware that the AFMEU knew of the negotiations any earlier than 11 April 1994, at which time the company became aware of an AFMEU pamphlet drop to Arrowcrest employees which addressed of the negotiations. There is no evidence to suggest that the company did, or intended to, notify the AFMEU of the negotiations as soon as practicable after they began, even in the period following the commencement of s.170ND.(7). In these circumstances I am satisfied that the AFMEU was not notified in accordance with s.170ND.(7)(a). In view of my finding in relation to s.170ND.(7)(a), I am required to consider what action (if any) to take pursuant to s.170ND.(7), whether or not s.170ND.(7)(b) has been complied with. Nontheless, it is necessary to consider s.170ND.(7)(b) for the purposes of determining what action (if any) should be taken pursuant to s.170ND.(7).

Section 170ND.(7)(b). Up until 26 April 1994, contact between the AFMEU and the company was by way of AFMEU pamphlets and company letters to the union in response to them, none of which could be described as an opportunity to take part in negotiations or be bound by the agreement. Belatedly, and in the context of considerable momentum toward a second ballot within the company, on 27 April 1994, Mr Gleeson sent a letter to the AFMEU, in response to an AFMEU letter to the company one day earlier, inviting the union to contact them for discussions. Contact was made by the union on 4 May 1994 leading ultimately to a meeting on 9 May 1994, the delay reflecting the availability of AFMEU representatives. An official of the AFMEU also met with the company on 11 May 1994, the day proceeding the 12 May 1994 vote. In all the circumstances

including the longstanding and ongoing negotiations through the Consultative Committee, I am not satisfied that this limited and belated invitation to meet with the AFMEU represented a reasonable opportunity to take part in negotiations or be bound by the agreement. In reaching this conclusion, the AFMEU is not without fault, as reflected in its tardy response to the 27 April 1994 letter from the company (which invited the union to arrange a

meeting) and its unavailability for an early and urgent meeting after 4 May 1994. This is a factor which is relevant in terms of s.170ND.(9)(b) in considering any appropriate action pursuant to s.170ND.(7). The appropriate action is dealt with later in this decision.

I have decided that pursuant to s.170NC.(1)(d) the agreement should not be approved in its current form having regard to clause 2(b). Further, I have found that the company has not fulfilled the requirements of s.170ND.(7) in respect of the AFMEU. I do not believe my concerns in relation to clause 2(b) can be adequately overcome by way of an undertaking pursuant to s.170NF.(2). I have decided pursuant to s.170NF.(3) that before refusing to implement the Arrowcrest agreement for the reasons set out above, I will give the company an opportunity to vary the agreement.

Should the company wish to so vary the agreement to remove the basis upon which I have declined to approve the agreement in its current form, I direct that:

1. the variation should be by way of a substitute agreement, varying the current instrument of agreement by deleting clause 2(b). In addition, although I would be prepared to accept an undertaking in respect of clause 2(a) and no disadvantage arises in relation to clause 7 of Appendix B, it would be preferable if those clauses could be varied to reflect the intent of the company in terms reflecting the undertakings the company indicated it was prepared to give during the course of proceedings;

2. the amended agreement be put to a ballot of those Arrowcrest employees, as at 12 July 1994, intended to be covered by it. I direct that the ballot be conducted in the same way as occurred in respect of the 22 April 1994 ballot conducted by the company, except that the

documentation provided to employees for the purpose of the ballot should be the full text of the amended agreement. The company is directed to provide the AFMEU, AWU - FIME, ALHMWU and EEPAWU with a copy of the amended agreement in advance of the ballot and to advise them of the ballot result within one working day of the completion of the ballot;

3. the company advise me of the results of the ballot and provide a copy of the amended instrument of agreement voted upon.

In respect to s.170ND.(7) as it applies to the AFMEU, the decision taken above pursuant to s.170NF.(3) will effectively cause an adjournment to allow the company to consider its position and, if it chooses, to amend the agreement in the manner required to give effect to the directions above. I will treat that period as an adjournment pursuant to s.170ND.(7) of the Act and require

the company to make itself available to meet with the AFMEU within one week of this decision to negotiate in respect of the agreement within the context of this decision. This should occur prior to an amended ballot being put to the workforce. The AFMEU should also be given an opportunity to be bound to any amended agreement. These steps would, in the circumstances of this matter, constitute appropriate action to rectify the earlier failure of the company to comply with the requirements of s.170ND(7) in respect of the AFMEU. The company may choose to further negotiate with the AWU - FIME in this period and should give it an opportunity to be bound by any amended agreement. Subject to amendment of the agreement consistent with this decision and adherence to my directions above, I would be prepared to approve an amended agreement from the date of receipt by me of advice of approval of the amended agreement by a majority of employees. Any eligible union, in the terms of s.170NP of the Act, wishing to be bound by an amended agreement, should advise me of that fact within two working days of the ballot conducted in relation to that agreement.