This is an application pursuant to s 32 of the Industrial Relations Act 1996 (NSW) by Local Government NSW (LGNSW) on behalf of its member, Lake Macquarie City Council (LMCC), seeking approval of an enterprise agreement between LMCC as employer, on the one hand, and the Administrative, Energy, Airlines and Utilities Union (USU), Local Government Engineers' Association of NSW, (LGEA) and Development and Environmental Professionals' Association (DEPA) as representatives of some of the employees covered by the proposed agreement, on the other (collectively, referred to as the Parties).
The enterprise agreement is to be known as the Lake Macquarie City Council Enterprise Agreement 2022 (Agreement).
Clause 1.3 of the Agreement provides that it "shall apply to all employees in Council except those designated as Senior Staff under section 332 of the Local Government Act 1993 (NSW)." Clause 1.5 of the Agreement provides that it "shall operate from the date of registration by the Industrial Relations Commission of NSW and shall remain in force for a period of one year."
Pursuant to s 32(1) of the Industrial Relations Act an enterprise agreement does not have any effect unless it is approved by the Commission under Part 2 of the Act. Following approval, the enterprise agreement is entered into a register kept by the Industrial Registrar and published on the NSW industrial relations website: s 45 of the Industrial Relations Act.
Section 34 provides for the making of an application for approval:
34 Application for approval of enterprise agreement
(1) Application for approval of an enterprise agreement may be made by lodging the agreement with the Industrial Registrar in accordance with this Part and the rules of the Commission.
(2) At proceedings of the Commission relating to any such application for approval, the following may appear or be represented -
(a) any party to the agreement,
(b) an industrial organisation, if its members or persons eligible to become members are affected by the agreement,
(c) a State peak council (but only with leave of the Commission),
(d) the President of the Anti-Discrimination Board (but only with leave of the Commission).
(3) The Commission is to deal with any such application for approval within 28 days, unless it requires additional time to do so because of the special circumstances of the case.
The application for approval of the Agreement was filed on 26 September 2022 and listed for hearing before me by telephone on 10 October 2022.
Mr Peter Bell, an industrial relations consultant for LGNSW appeared on behalf of the applicant. I note that LGNSW is an industrial organisation of employers, within the meaning of the Industrial Relations Act and that its member, LMCC, is named in cl 1.2 of the Agreement, as a party to the Agreement.
Mr N Martin appeared on behalf of the USU, an industrial organisation of employees within the meaning of the Industrial Relations Act, and which, pursuant to cl 1.2(a) of the Agreement, is named as a party to the Agreement.
Mr G Brock appeared on behalf of LGEA, an industrial organisation of employees within the meaning of the Industrial Relations Act. Clause 1.2(b) of the Agreement records that a party to the Agreement is "Professionals Australia LGEA". Mr Brock informed me that this is the trading name of the LGEA and on this basis I am satisfied that Mr Brock was entitled to appear on behalf of the LGEA which has as its members, persons who are affected by the Agreement. Mr Brock also mentioned the appearance of DEPA, an industrial organisation of employees within the meaning of the Industrial Relations Act, and which, pursuant to cl 1.2(c) of the Agreement, is named as the fourth and final party to the Agreement.
A copy of the Agreement, signed by representatives of each of the named parties was admitted into evidence as exhibit 'LGNSW 1'.
I confirmed with Mr Bell during the hearing that the application for approval of the Agreement contained a typographical error in Part A: the application as filed sought approval of an enterprise agreement entitled "Lake Macquarie City Council Enterprise Agreement 2022 - 2025." Approval was in fact sought for an enterprise agreement entitled "Lake Macquarie City Council Enterprise Agreement 2022" and the term of the Agreement is for one year only.
The application for approval was otherwise in accordance with the prescribed form and included a Statement of Particulars.
In support of the application Mr Bell read an affidavit affirmed by himself on 26 September 2022, which set out the matters required by r 7.1 of the Industrial Relations Commission Rules 2009. Annexed to the affidavit as Annexure A was a 'Comparison and Compliance Statement' which, pursuant to r 7.1(1)(b), compared the conditions of employment under the Agreement with those that would otherwise apply under the relevant award, being the Local Government (State) Award 2020. As stated in cl 2.2 of the Agreement, and confirmed by Mr Bell in his affidavit, "the Agreement shall regulate totally the terms and conditions of employment previously regulated by all Awards and Agreements covering employees of Council." (For completeness I note however, that cl 1.4 of the Agreement states that the Agreement "does not exclude the application of clause 46(ii) Area, Incidence and duration of the Local Government (State) Award 2020 in relation to the definition of local government industry" and clause 81.2 provides that certain clauses, which have been incorporated directly from the Local Government (State) Award 2020, will be subject to variation in line with any variation of the cognate clause in the award, subject to certain conditions.)
The affidavit of Mr Bell otherwise deposed that:
1. (as required by r 7.1(1)(a) - the Agreement will replace and rescind the Lake Macquarie City Council Enterprise Agreement 2018 (EA18/06), which nominally expired on 21 August 2021 [I note that the cl 2.2 of the Agreement lists, 'for the avoidance of doubt', a number of other agreements which will also be rescinded and replaced by the Agreement];
2. (as required by r 7.1(1)(c)(i)) - the Agreement does not, on balance, provide a net detriment to employees covered by the Agreement when compared to the aggregate package of conditions of employment and rates of pay that would otherwise apply under the award;
3. (as required by r 7.1(1)(c)(ii)) - the Agreement complies with all relevant statutory requirements, including those of the Anti-Discrimination Act 1997 (NSW);
4. (as required by r 7.1(1)(c)(iii)) - the parties understand the effect of the Agreement;
5. (as required by r 7.1(1)(c)(iv) - the parties have not entered the Agreement under duress; and
6. (as required by r 7.1(c)(v)) - the agreement complied with the principles for approval of enterprise agreements as determined by the Full Bench in the Review of the Principles for Approval of Enterprise Agreements 2021/2022 [2022] NSWIRComm 1005.
In support of the application Mr Bell also read an Affidavit of Melissa Rowe, Director, Organisational Services with LMCC. Unfortunately, it appeared that the affidavit had been affirmed on a different day to the day on which it was witnessed. I directed LGNSW to file and serve a remediating affidavit which, in accordance with my direction, was duly received by the Commission prior to 1pm on 11 October 2022.
Ms Rowe's affidavit, affirmed on 11 October 2022, explained the extent to which LMCC had gone to consult and communicate with its employees as to the changes to terms and conditions of employment proposed by the Agreement. Such efforts included:
1. undertaking an 'Enterprise Agreement and Working at LakeMac' survey in August 2021 to gather feedback, on an anonymous basis, from employees regarding their sentiments on the existing enterprise agreement, namely the Lake Macquarie City Council Enterprise Agreement 2018;
2. forming a discussion group comprised of union delegates from each of the three unions, namely the USU, the LGEA and the DEPA and management representatives from LMCC, which met on a regular basis, typically one meeting per month to consider recommended amendments to the existing enterprise agreement;
3. forming working parties which supported the discussion group, which concentrated on specific areas of the Agreement including:
1. decision-making at the frontline;
2. diversity including an ageing workforce;
3. capability and capacity building;
4. flexibility;
5. simplification; and
6. resilience and change;
and which presented recommendations to the discussion group on suggested changed for the new enterprise agreement;
1. providing training to members of the working parties in interest-based bargaining, diversity and inclusion, LMCC's financial sustainability considerations and an overview of the results from the survey;
2. on 20 July 2022, writing to the unions and requesting the endorsement of the draft Agreement;
3. on 27 July 2022, LMCC's Chief Executive Officer, Morven Cameron (CEO), sending an email to all employees attaching a copy of the draft Agreement, together with documents entitled, "EA Key Changes" and "EA 2022-Summary of All Changes";
4. on 27 July 2022, holding a 'staff focus forum' for all employees, at which the CEO and members of the discussion group made a presentation including an outline of the process up to that point, the key changes within the draft Agreement and what the remainder of the process would involve;
5. placing a recording of the staff focus forum on LMCC's intranet page for employees to go back and re-watch or for those who are unable to attend the live session and questions asked and answers provided, were noted for later publication on LMCC's intranet in a frequently asked questions (FAQs) format; and
6. holding a series of drop-in sessions on 28 July, 2 August, 3 August and 4 August 2022 which were facilitated by a 'People Support Business Partner' and a union delegate, to provide the opportunity for all employees to seek further clarification and guidance on the key changes within the draft Agreement. Questions asked and answers provided were collated and subsequently added to the FAQs page of LMCC's intranet.
On 11 August 2022 a vote was taken by each of the unions of their members which confirmed acceptance of the Agreement.
At the hearing on 10 October 2022 Mr Martin for the USU and Mr Brock for the LGEA and the DEPA, confirmed that the Agreement was supported by their respective organisations. Mr Martin submitted during the hearing that it had been a significant undertaking to achieve the Agreement and I acknowledge the parties' efforts in this regard. Mr Brock informed the Commission that his organisation's members had strongly endorsed the Agreement and he acknowledged "the collaborative and profession nature of the negotiations." The parties are to be congratulated for approaching the negotiations of a new enterprise agreement collaboratively and professionally and giving proper attention to the statutory and other requirements of such agreements.
It is unnecessary to set out in any detail the key changes that will occur to the terms and conditions of employment of LMCC's employees by the introduction of the Agreement. I note however, that some of the key changes (which are by no means exhaustive) include:
1. an increase to the rate of pay of 3.25% which is higher than the Local Government State Award increase of 2%;
2. the abolition of the picnic day event, although union members will be entitled to one days' time in lieu, at single time, each year, with part time employees to be credited time in lieu on a pro-rata basis according to contract hours;
3. the trialling of alternative rosters arrangements such as a four-day work week and the flexi-roster for part time employees, subject to operational requirements, and where financially viable;
4. changes to the accrual and application of time in lieu;
5. the incorporation of an existing 'procedure' regarding flexi time into the Agreement;
6. the ability of employees to request a swap of traditional public holidays with other cultural holidays;
7. an increase of one day per year for health and wellbeing leave;
8. an increase in paid parental leave and other changes with respect to leave in the event of a miscarriage and supporting parent leave; and
9. adoption of the more favourable award provision of 10 days per year for family and domestic violence leave.
(The above descriptors do not substitute in any way for the actual terms of the Agreement.)
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Relevant Principles
Section 35(1) of the Industrial Relations Act provides that the Commission may only approve an enterprise agreement if it is satisfied that:
(a) the agreement complies with all relevant statutory requirements (including the requirements of this Part and of the Anti-Discrimination Act 1977), and
(b) in the case of an agreement that covers employees to whom State awards would otherwise apply--the agreement does not, on balance, provide a net detriment to the employees when compared with the aggregate package of conditions of employment under the State awards, and
(b1) in the case of an agreement that covers employees to whom Federal awards would otherwise apply--the employees are not disadvantaged in comparison to their entitlements under the Federal awards, and
(b2) in the case of an agreement that covers employees to whom no State or Federal award would otherwise apply--the agreement does not, on balance, provide a net detriment to the employees when compared with the aggregate package of conditions of employment under a State or Federal award that covers employees performing similar work to that performed by the employees covered by the agreement, and
(c) the parties understand the effect of the agreement, and
(d) the parties did not enter the agreement under duress.
Rule 7.1 of the Industrial Relations Commission Rules reflects the requirements of s 35(1).
Section 35(3) of the Industrial Relations Act provides:
The Commission is to follow the principles for approval set under section 33 when deciding whether to approve an enterprise agreement, unless satisfied that any departure from those principles would not prejudice the interests of any of the parties to the agreement.
Section 33 of the Industrial Relations Act provides that the Full Bench of the Commission is required to set principles to be followed by the Commission in determining whether to approve enterprise agreements and provides guidance as to the content of the principles and the procedures to be following in relation to their review and publication.
The Full Bench last reviewed the 'Principles for Approval of Enterprise Agreements' (Principles) on 23 February 2022 in Review of the Principles for Approval of Enterprise Agreements 2021/2022 [2022] NSWIRComm 1005. Annexure A to that decision are the current Principles set by the Full Bench, to which I have had regard when considering the present application.
In addition, ss 38 and 39 of the Industrial Relations Act prescribe certain mandatory requirements as to the form and content of enterprise agreements.
[3]
Consideration
Part 3 of the Principles sets out the process for approving enterprise agreements. Consistent with Part 3:
1. the Agreement contains, at cl 5, an anti-discrimination clause in the form of Attachment 1 to the Principles and I have had regard to the principles of the Anti-Discrimination Act 1977 when considering this application, as I am also required to do virtue of s 169(1) of the Industrial Relations Act;
2. the parties addressed me during the hearing as to the matters required under the Industrial Relations Act and the Principles and based on the affidavits of Mr Bell and Ms Rowe, I am satisfied that the mandatory requirements of the Act, including s 35, have been met;
3. Mr Bell's affidavit complies with r 7.1 of the Industrial Relations Commission Rules 2009.
Part 2 of the Principles set outs the criteria for approval of enterprise agreements. Clauses 2.2, 2.3, 2.4(b) are not applicable to this application. In respect of the balance of the applicable criteria:
1. on the basis of the evidence of Mr Bell and Ms Rowe, which was endorsed by Messrs Martin and Brock:
1. I am satisfied that the parties have meet criterion 2.1, which largely reflect the matters required in s 35(1) of the Industrial Relations Act; and
2. I am satisfied, by reference to the approach prescribed in cl 2.5 of the Principles, that the Agreement does not, on balance, provide a net detriment to the employees when compared with the aggregate package of conditions of employment under the Local Government (State) Award 2020, being the criterion stipulated in cl 2.4(a) of the Principles;
1. Clause 72 of the Agreement - 'Consultative Committees' - meets the requirements of criterion 2.6 of the Principles; and
2. Clause 71 of the Agreement - 'Resolution of Workplace Issues' - meets the requirements of criterion 2.7 of the Principles and s 39 of the Industrial Relations Act.
The Agreement is in writing and signed by or on behalf of the parties to it and otherwise meets the requirements of s 38 of the Industrial Relations Act.
The Lake Macquarie City Council Enterprise Agreement 2022 is approved in accordance with s 35 of the Industrial Relations Act and will apply, in accordance with cl 1.5 of the Agreement, from the date of registration of the Agreement by the Industrial Relations Commission, for a period of one year.
As the Agreement, on its terms, will not apply until it is registered, I direct the Industrial Registrar to enter the Lake Macquarie City Council Enterprise Agreement 2022 in the register of approved enterprise agreements forthwith.
Janet McDonald
Commissioner
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DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 11 October 2022