National Union of Workers, New South Wales v HP Distribution Pty Ltd

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY FAIR WORK DIVISION NSD 1736 of 2012

BETWEEN: NATIONAL UNION OF WORKERS, NEW SOUTH WALES BRANCH

JUDGE: RARES J DATE: 4 FEBRUARY 2013 PLACE: SYDNEY

REASONS FOR JUDGMENT (REVISED FROM THE TRANSCRIPT) 1 National Union of Workers (NUW) seeks constitutional writ relief against a decision of what was Fair Work Australia, and is now the Fair Work Commission, approving the HP Distribution Pty Limited Greenfields Agreement 2011 (the agreement) as a "greenfields agreement". HP Distribution Pty Ltd is a subsidiary in the Woolworths Limited group of companies. HP Distribution was incorporated on 6 December 2011. On 9 December 2011, it entered into the agreement with the Shop Distributive and Allied Employees Association (SDA). 2 The basis of NUW's challenge is that the agreement was not a greenfields agreement within the meaning of s 172 of the Fair Work Act 2009 (Cth). NUW contended that, before the Commission could have approved it, the agreement needed to meet the requirements for a greenfields agreement within the meaning of s 172(2)(b) for the Commission to have jurisdiction.

The Procedural Background 3 A commissioner initially heard and determined the application for approval of the agreement under s 186 of the Act. He approved the agreement on 31 January 2012. The agreement operated from 7 February 2012. NUW then appealed to the Full Bench of the Commission. The Full Bench affirmed the decision after hearing fresh evidence and submissions from NUW and further evidence from the other parties. 4 NUW argued that the Full Bench erred because, first, the agreement did not relate to a genuine new enterprise that the employer or employers "are establishing or proposing to establish" within the meaning of s 172(2)(b)(i) and, secondly, prior to HP Distribution's incorporation and before the agreement was made, some persons had already been employed to do the work in the enterprise by other members of the Woolworths group. NUW contended that each of those factors demonstrated that the agreement was not, in fact, a greenfields agreement and so the Commission had no jurisdiction to approve it under the Act.

The Statutory Scheme 5 It is necessary first to understand the statutory scheme. The Act stated a number of general objects in s 3. These included objects of enabling fairness and representation at work, prevention of discrimination by recognising the right of freedom of association and the right to be represented, protecting against unfair treatment and discrimination, providing accessible and effective procedures to resolve grievances and disputes, and providing effective compliance mechanisms (s 3(e)) and achieving productivity and fairness through an emphasis on enterprise-level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action (s 3(f)). 6 Section 172 was contained in Pt 2.4 of Ch 2. Part 2.4 itself commenced with a separate objects section in s 171 that provided: "171 Objects of this Part The objects of this Part are: (a) to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and (b) to enable FWA [i.e. what is now the Commission] to facilitate good faith bargaining and the making of enterprise agreements, including through: (i) making bargaining orders; and (ii) dealing with disputes where the bargaining representatives request assistance; and (iii) ensuring that applications to FWA for approval of enterprise agreements are dealt with without delay." (emphasis added) 7 Relevantly, s 172 provided: "Single-enterprise agreements (2) An employer, or 2 or more employers that are single interest employers, may make an enterprise agreement (a single-enterprise agreement): (a) with the employees who are employed at the time the agreement is made and who will be covered by the agreement; or (b) with one or more relevant employee organisations if: (i) the agreement relates to a genuine new enterprise that the employer or employers are establishing or propose to establish; and (ii) the employer or employers have not employed any of the persons who will be necessary for the normal conduct of that enterprise and will be covered by the agreement. Note: The expression genuine new enterprise includes a genuine new business, activity, project or undertaking (see the definition of enterprise in section 12). Multi-enterprise agreements (3) Two or more employers that are not all single interest employers may make an enterprise agreement (a multi-enterprise agreement): (a) with the employees who are employed at the time the agreement is made and who will be covered by the agreement; or (b) with one or more relevant employee organisations if: (i) the agreement relates to a genuine new enterprise that the employers are establishing or propose to establish; and (ii) the employers have not employed any of the persons who will be necessary for the normal conduct of that enterprise and will be covered by the agreement. Note: The expression genuine new enterprise includes a genuine new business, activity, project or undertaking (see the definition of enterprise in section 12). Greenfields agreements (4) A single-enterprise agreement made as referred to in paragraph (2)(b), or a multi-enterprise agreement made as referred to in paragraph (3)(b), is a greenfields agreement. Single interest employers (5) Two or more employers are single interest employers if: (a) the employers are engaged in a joint venture or common enterprise; or (b) the employers are related bodies corporate; or (c) the employers are specified in a single interest employer authorisation that is in operation in relation to the proposed enterprise agreement concerned." (original italic emphasis for defined terms, bold emphasis added) 8 "Enterprise" was defined to mean "a business, activity, project or undertaking" (s 12). The general rule for making enterprise agreements in the Act is contained in s 172(2)(a). Ordinarily, therefore, enterprise agreements will be made between persons who are in an existing relationship of employer and employees. It is common ground that a greenfields agreement, as provided in s 172(2)(b), is the exception to that general rule. That is because such an enterprise agreement will be between an employer and one or more relevant employee organisations in respect of a new enterprise, in anticipation of and before a new enterprise will have any employees - i.e. the "green field". 9 The succeeding provisions in Pt 2.4 made particular provisions, where necessary, that dealt with the treatment of greenfields agreements. Thus, s 182(3) provided that a greenfields agreement was made when it had been signed by each employer and each relevant employee organisation that the agreement was expressed to cover. Then, importantly, the jurisdiction of the Commission was enlivened by s 186(1) which authorised it to approve an enterprise agreement, including a greenfields agreement. Relevantly, s 185(1)(a) provided that, if the agreement was a greenfields agreement, either an employer or a relevant employee organisation covered by the agreement had to make the application for its approval. That had to be done within 14 days after the agreement was made (s 185(4)). Regulations could be made relating to the signing of enterprise agreements under s 185(5). Next, s 187(5) provided: "(5) If the agreement is a greenfields agreement, FWA must be satisfied that: (a) the relevant employee organisations that will be covered by the agreement are (taken as a group) entitled to represent the industrial interests of a majority of the employees who will be covered by the agreement, in relation to work to be performed under the agreement; and (b) it is in the public interest to approve the agreement." (emphasis added) 10 A reference in the Act to an employer or an employee in relation to a greenfields agreement included a reference to a person who may become an employer or employee (s 256). A person who was aggrieved, inter alia, by a decision made by, relevantly, a Commissioner to approve an enterprise agreement could appeal to the Full Bench of the Commission with its permission (s 604). A decision of the Full Bench in relation to an appeal or review of the decision of the Commissioner had to be given in writing pursuant to s 601(1)(a).

The factual context and Mr Town's Evidence 11 Other than the argument as to jurisdictional facts, there was no issue, that the Full Bench was entitled to give NUW permission to appeal and that the other matters that the Full Bench was required to decide in the course of upholding the Commissioner's decision were not appropriately decided. 12 The evidence before the Full Bench included the unchallenged evidence of Phillip Town, a logistics manager, employed by Woolworths for a new development known as the Hoxton Park precinct. That development was the subject of the greenfields agreement. He explained that the Woolworths group comprised a range of different entities that conducted a variety of different businesses in which individual business units generally operated in substantially autonomous manners. Those business units included: the Big W stores unit, that operated retail stores, and was predominantly conducted through Woolworths (although it operated in areas that are not presently relevant through a South Australian subsidiary); the Dick Smith Electronics unit that operated Dick Smith stores and a Dick Smith warehouse at Chullora operated through another company, DSE (Holdings) Pty Limited (DSE Holdings); and a new business unit that had been recently established by Woolworths called the Masters Home Improvement unit. That operated Masters Home Improvement and Hardware stores through Masters Home Improvement Australia Pty Limited. 13 Mr Town explained the way in which HP Distribution was undertaking its logistics business out of the Hoxton Park precinct. I have taken the following findings of the facts from his evidence, except where I have identified another source. His role entailed the management of the shared service general merchandise distributional requirements for the Big W, Dick Smith and Masters businesses for selected regions in Australia, as well as supporting multichannel supply requirements. The latter serviced elements of Woolworths' overall business that required different channels of distribution, some from a store to a customer, some from distribution centre to a customer, and some from the distribution centre to a regional hub, thence to a customer's home. A number of different employees of Woolworths reported directly to Mr Town, including, among others, the operations managers for each of the two large warehouses, called "Shed North" and "Shed South" in the Hoxton Park precinct. Woolworths' practice at other distribution centres operated by it and its subsidiaries was that it employed senior management personnel but direct wages employees, as they were called, were employed by the subsidiary that operated the particular facility. 14 In about August 2011, Woolworths and or DSE Holdings commenced operating a support operation to the Dick Smith business unit out of a small section in Shed North. That work was the receipt and distribution of indent stock, ordered from overseas. Previously a small distribution centre had been operated by DSE Holdings in Villawood. That had distributed indent stock for the Dick Smith business unit, but it was no longer operating. Woolworths and/or DSE Holdings had engaged a labour hire contractor, Action Work Force, to provide casual labour for the work at Shed North. None of the labour staff provided by Action Work Force was ever employed by Woolworths, DSE Holdings or any other member of the Woolworths group prior to 9 December 2011. The support operation distribution work involved the unpacking of containers of stock when they arrived, storing it on shelves, retrieving it for forward delivery and arranging onward delivery through a third party courier company. Initially, about eight of the Action Work Force staff performed the tasks for a short period and by October 2011, as the volume of stock started to increase prior to Christmas, the number of agency staff had increased to about 15 with two shifts running in the morning and afternoon. Following Christmas, the number of agency staff engaged decreased significantly. 15 Various commissioning and testing work was undertaken at the Hoxton Park precinct prior to 9 December 2011. On 11 October 2011, negotiations commenced between the Woolworths interests and the New South Wales branch of SDA. The assistant secretary treasurer of SDA, Bernard Smith, and other SDA officers attended a meeting with Mr Town and other representatives of Woolworths on that day. The SDA officers received a written presentation that identified an overview of what Woolworths intended at that stage for the Hoxton Park precinct. The presentation identified a plan to service the Big W and Masters businesses. About 78% of the staff would be working in respect of the Big W businesses and 22% in respect of Masters. The presentation recorded that there would be two distribution centres in the Hoxton Park precinct, one, for the Big W unit, with about 90,000 square metres and the other, for the Masters unit, with about 45,000 square metres. It stated that a four-year greenfields agreement would be negotiated to cover employees who worked at the site. The presentation did not refer to the Dick Smith business, perhaps because Woolworths intended, at that stage, to dispose of it. Nonetheless, some distribution work was being undertaken at the Hoxton Park precinct at that time in the way I have mentioned. 16 The commissioning and testing work that occurred prior to 9 December 2011 included completion of the building site and internal fit out of the buildings and automation work, which was undertaken by third parties. Four of the Action Work Force employees had assisted in testing and commissioning of belts and automation equipment in the South Shed. In addition, Woolworths' managerial employees performed work necessary to establish the business at the Hoxton Park precinct. 17 Importantly, no individuals had been employed by HP Distribution prior to 9 December 2011. After that day HP Distribution advertised for staff and by 16 January 2012, the first employees of HP Distribution began performing work covered by the greenfields agreement at the Hoxton Park precinct. By 26 March 2012, there were 82 employees covered by the agreement working at the site. HP Distribution also engaged labour hiring agencies to provide other staff to undertake work at the precinct. When Mr Town made his affidavit, the precinct operated through receiving goods by three different methods: indent delivery, being goods delivered in containers that required to be destuffed and loaded onto pallets or for storage; local delivery items; and cross stock items, orders placed at store level with local suppliers who pick, pack and label materials ready for delivery to the store and then send pallets of mixed store cartons through the distribution centres for automated sorting, palletising and delivery to the individual stores. 18 Store orders were received daily. The distribution model for each of the businesses supported by the distribution centre at the Hoxton Park precinct differed due to the particular requirements of each of the Dick Smith, Big W and Masters stores for its own types of stock. The volume of goods processed through the precinct would differ greatly from customer to customer and would be significantly affected by seasonal variability of stock requirements for the different businesses. The Masters business was a new venture of the Woolworths Group and that it was intended to compete directly with the Bunnings Warehouse business. The first Masters Home Improvement stores had opened in August 2011 and since that time, seven stores had opened with a long term plan to open about 150 stores across Australia. 19 Mr Town said that signage at the Hoxton Park precinct would be erected to identify Shed North as the distribution centre supporting the Dick Smith business unit and Shed South as that supporting the Big W unit. The proposed signage would be erected on Shed North by mid-2012, for the Masters' business unit to indicate that it was the distribution centre supporting that unit. He anticipated that in the financial year 2012-2013, the staff split undertaking work to support each of the three businesses, on an average volume day, would be 3% allocated to Dick Smith, 21% to Masters and 76% to Big W. Subsequently, Woolworths announced that it would seek to sell the Dick Smith business. If such a sale occurred there might be some impact on the way in which the HP Distribution business operated in the future. The support provided by HP Distribution to each of the three business units would be managed through a service level agreement covering areas such as, but not limited to, level of frequency of service, budgetary commitment and delivery accuracy. 20 Importantly, there had never previously been one distribution facility servicing the Big W, Dick Smith and Masters business units. One of the aims of HP Distribution was to have a cross-functional work force that operated across the Hoxton Park precinct and thus across both sheds. This would enable employees working in one shed to move to work in the other as and when demand required.

The Full Bench decision 21 The Full Bench referred to Mr Town's evidence in its reasons. It rejected a submission made by SDA that it was not in the public interest to allow NUW to intervene. NUW had alleged that there might have been a deliberate attempt to exclude it from negotiating for coverage of employees at the Hoxton Park precinct. The Full Bench allowed fresh evidence to be led by all of the parties on that issue to ensure that full consideration could be given to whether or not the Commissioner had been prevented from having all material before him that was necessary for the exercise of his discretion. The Full Bench said that it had considered the evidence provided by all the parties to the appeal. Neither HP Distribution nor SDA had brought to NUW's attention the existence of the greenfields agreement or the listing of the application for its approval. The Full Bench was satisfied that there was no overt conduct by either HP Distribution or SDA to exclude NUW from appearing before the Commissioner or presenting its submissions. It found the Act did not require that NUW be made aware of the application for approval of the agreement, if it was a greenfields agreement. 22 The Full Bench held that HP Distribution was a brand new Woolworths subsidiary and that the information about the greenfields agreement would not necessarily have alerted a NUW official that a listing with the name of HP Distribution was in relation to the Hoxton Park precinct. The Full Bench said that the issue for its consideration was whether or not HP Distribution's "two distribution centres are now a Greenfields Site [sic] within the meaning of the Act." It referred to a statutory declaration lodged before the Commissioner that had made that assertion. It also referred to Mr Town's evidence that HP Distribution was the company then undertaking the logistics business out of the Hoxton Park precinct. The Full Bench held that Woolworths and its subsidiary, DSE Holdings, previously had operated a support operation at Shed North from August 2011 with labour hire staff. It then quoted extensively from Mr Town's affidavit in respect of those arrangements before concluding: "[22] On balance, on the facts before us, we are persuaded that the HPD Distribution Centres constituted a Greenfields Site. It was a genuine new enterprise within the meaning of ss 172(2)(b)(ii) at the time the Agreement was made. [23] We are satisfied that Woolworths Ltd created HPD to operate a distribution business to service a different balance of subsidiaries and its business needs. We are satisfied that the intended client base and the methods of operation were different from that of any existing business and that, for the management of those managements, a new business was formed."

The parties' submissions 23 NUW argued that while the Full Bench had jurisdiction to consider whether there was a greenfields agreement before it within the meaning of s 172(2)(b), it could not conclusively determine that issue and that the material in evidence demonstrated that the agreement was not one that complied with the section. That was, NUW contended, because from August 2011 a distribution business for the Dick Smith stores had operated from the North Shed and, so, the enterprise covered by the agreement was not a "genuine new enterprise" but one that was existing at the time the agreement was made. NUW also argued that because of Woolworths' intensive involvement prior to 9 December 2011, and in particular, in the period prior to HP Distribution being incorporated on 6 December 2011, HP Distribution was not an employer proposing to establish or establishing a genuine new enterprise. Rather, NUW argued, Woolworths proposed to establish the new enterprise and had done all that work. It argued that it was difficult to see how the Full Bench had taken all of the evidence in Mr Town's affidavit into account in coming to its conclusions in [22] and [23] of its reasons set out above. NUW's core complaint was that [23] of the Full Bench's reasons did not address or deal with the situation that work had already commenced at the Hoxton Park precinct, as the Full Bench had referred to earlier in its reasons and as Mr Town's evidence had made plain. 24 NUW contended that the employer referred to in s 172(2), had to be the employer that itself intended to establish the genuine new enterprise, not a holding company or operating company, such as Woolworths in this case. It contended that the Commission's power to approve a greenfields agreement depended on the existence of a jurisdictional fact, namely that the agreement met the statutory criteria in s 172(2)(b). NUW submitted that it was not sufficient for the Commission merely to be satisfied of a fact where a Court ultimately found that that jurisdictional fact did not exist. It referred to Plaintiff M70/2011 v Minister for Immigration and Citizenship (2011) 244 CLR 144 esp at 178-180 [56]-[58] per French CJ and 193-194 [106]-[109] per Gummow, Hayne, Crennan and Bell JJ. SDA adopted the characterisation put forward by the NUW, that the existence of a greenfields agreement, within the meaning of s 172(2), was a jurisdictional fact. 25 NUW argued that HP Distribution could not effectively be the employer described in s 172(2)(b) because Woolworths and SDA had negotiated what became the greenfields agreement at a time when HP Distribution did not exist. NUW also relied on the Explanatory Memorandum for the Fair Work Bill 2008 and, in particular [691]-[693]. Those paragraphs explained that a greenfields agreement had to relate to a genuine new enterprise that the employer or employers were establishing or proposing to establish. In [692]-[693] the Explanatory Memorandum stated: "692 The use of the word "genuine" in paragraphs 172(2)(b) and 172(3)(b) is intended to make it clear that the enterprise must be a new enterprise rather than an existing enterprise that the employer or employers acquire, or propose to acquire, as a going concern (see the decision of the AIRC in Re Patrick Cargo Pty Limited Certified Agreement 2002 (2002) 115 IR 443). In other words, a genuine new enterprise is not an enterprise that has been previously carried out by another employer. For example, a supermarket operator could not make a greenfields agreement if it acquired a chain of liquor stores in a transfer of business situation. Similarly, a new employer cannot make a greenfields agreement where it acquires or proposes to acquire an enterprise that has previously been conducted by another employer. 693. The nature of the genuine new enterprise may nonetheless be the same or similar to the employer's existing enterprise, particularly in the case of a new project. For example, an existing employer in the construction industry could make a greenfields agreement in relation to a genuine new construction project. However, an existing employer, such as a major retailer, could not make a greenfields agreement in relation to a new store that it is proposing to establish if that store is part of the employer's existing enterprise." (emphasis added) 26 HP Distribution argued that, reading the Act as a whole, it was clear that the Parliament did not intend that, were the Commission to commit a error in characterising an agreement as a greenfields agreement, the agreement could be invalidated for that reason at a later stage. HP Distribution pointed to the inconvenience that could be caused if a Court set aside an approval of a greenfields agreement on the basis that the Commission had no jurisdiction, perhaps some years after it had been acted on for the benefit of employees and the relevant employer over that antecedent period.

Consideration 27 Where jurisdiction depends on particular facts or a particular state of affairs, a challenge to jurisdiction can only be resisted by establishing the facts on which it depends. Those facts must be established on the balance of probabilities, in light of all the evidence advanced in the proceedings to determine whether there is jurisdiction: Owners of "Shin Kobe Maru" v Empire Shipping Company Inc (1994) 181 CLR 404 at 426 per Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ. In Corporation of the City of Enfield v Development Assessment Commission (2000) 199 CLR 135 Gleeson CJ, Gummow, Kirby and Hayne JJ discussed the role of jurisdictional facts and the manner in which those may be found, including by a specialised body or agency, such as to the Commission. Their Honours said (199 CLR 155 [48]): "Where the question is whether the tribunal acted within jurisdiction, it must be for the court to determine independently for itself whether that is the case. Speaking with respect to jurisdictional challenges to decisions of the Australian Conciliation and Arbitration Commission, Mason J observed (R v Alley; Ex parte NSW Plumbers & Gasfitters Employees' Union (181) 153 CLR 376 at 390): "If the evidence remains the same, if the Full Bench on appeal has confirmed the decision at first instance and if the issue of fact is one in the resolution of which the Commission's knowledge of industry specially equips it to provide an answer, greater weight will be accorded than in cases in which one or more of these factors is absent." That statement was approved by six members of the Court in their joint judgment in R v Williams; Ex parte Australian Building Construction Employees' and Builders Labourers' Federation ((1982) 153 CLR 402 at 411. See also Rv Ludeke; Ex parte Queensland Electricity Commission (1985) 159 CLR at 183-184) . These decisions were made by this Court in the exercise of its original jurisdiction under s 75(v) of the Constitution. The statement of Mason J was directed to the question of what was open to this Court. His Honour was not addressing the question whether a court which, in the circumstances postulated by his Honour, did not give weight to the decision of the administrative tribunal thereby fell into appealable error. What was said should be understood as permitting rather than requiring recourse to the administrative decision." (emphasis added) 28 Their Honours went on to qualify what Mason J had said about the situation where all the evidence "remains the same". They held that that statement should be read as "including evidence which, in all significant respects, is substantially the same". Their Honours pointed out that, it was the task of the Court to determine whether, in truth, the tribunal was seized of jurisdiction where the issue was whether the specialised tribunal had jurisdiction to determine in a matter, for itself. The Court had to do this upon the evidence before it and on the proper construction of the provision: see 199 CLR at 155-156 [49]-[50]; M70/2011 244 CLR at 179 [57], 193-194 [108]-[109]. 29 In my opinion, the Commission could only approve an agreement as a greenfields agreement under ss 186(1) and 187(5) if the document satisfied the requirements of s 172(2)(b) or 172(3)(b). That is, the actual existence of the facts necessary for an agreement to meet the statutory criteria for a greenfields agreement was a jurisdictional fact necessary to ground the Commission's power to approve it. If the agreement were not of that nature, then the only enterprise agreement that the employer could make was one under s 172(2)(a). Relevantly, s 172(2)(b) required that a greenfields agreement have the following characteristics, namely that: an employer (here HP Distribution) had made the enterprise agreement with a relevant employee organisation (here SDA); the agreement related to a genuine new enterprise that the employer was establishing or was proposing to establish; the employer had not employed, before the agreement was made, any of the persons who were necessary for the normal conduct of that enterprise; and those persons were to be covered by the agreement. 30 It is significant that in the expression "are establishing or propose to establish" s 172(2)(b)(i) addressed alternatives comprised of a present and potential state of the new enterprise. In its ordinary and natural meaning that expression contemplated that the employer or someone whose work it adopts can have progressed the new enterprise beyond a planning or merely conceptual phase. However, s 172(2)(b)(ii) ensured that the employer could not employ anyone who would be necessary for the normal (as opposed to preparatory) conduct of the enterprise before it could enter a greenfields agreement. Moreover, s 172(3)(b) contemplated that the agreement also could relate to a genuine new enterprise that two or more separate employers "are establishing or propose to establish". The words in the present tense in each of s 172(2)(b) and (3)(b), "are establishing", indicated that preparatory work may be done, including significant preparatory work prior to the agreement being made. 31 It is difficult to contemplate how two or more employers, who were not all single interest employers, would be able to make an enterprise agreement for the purposes of s 172(3)(b) unless significant preparatory work to formulate business plans and define roles for each of those employers had been done. Where two or more employers with different interests agree to undertake a new enterprise, ordinarily, they will need to identify the nature and scope of their individual responsibilities for the future conduct of the enterprise, what each of those employers expects the business to do, how its activities will be undertaken, the nature of the tasks and work the employees will perform, their training and the other incidents that such a complex arrangement would involve. The practical implementation of such an arrangement may also require considerable lead time before the new enterprise would be ready to commence operating. Such arrangements might also need to address any issue that might arise under the provisions of Pt IV of the Competition and Consumer Act 2010 (Cth) in relation to their collaboration on that matter. 32 There is nothing in s 172(3) that identifies any particular assignment of responsibilities between the two or more employers as to whether one or all is or are to undertake the relevant establishment work, or whether the enterprise agreement will be made by all of the employers, one or some of them together with, or simply by, a special purpose vehicle that is a newly incorporated subsidiary of one or some or all of the employers. Those matters suggest that the Parliament intended that a genuine new enterprise could be in the process of being established to a greater or lesser extent before the ink had to be dry on greenfields agreement or the vehicle by which it would be conducted was identified or incorporated. Indeed, the expressions "are establishing" and "propose to establish" in each of ss 172(2)(b)(i) and (3)(b)(i) indicated that one of two scenarios might exist and that preparatory steps, even of a very substantial nature, would not necessarily disqualify an agreement from being a greenfields agreement for the purposes of s 172(2) or (3). The mere fact that an employer, or a related company, had taken steps to establish the business, of itself, will not detract from the genuineness of the new enterprise or preclude the employer subsequently being able to enter a greenfields agreement provided that the requirements in s 172(2) or (3) are met. 33 I am of opinion that the unchallenged evidence of Mr Town established that there was a genuine new enterprise that HP Distribution was establishing or proposing to establish at the time the greenfields agreement was made. That is because, as the Full Bench itself found, and I agree, Woolworths had created HP Distribution to operate a distribution business to service a different balance of subsidiaries and its business needs. That business, activity, project or undertaking was different from any existing business that Woolworths was operating. The scope of the arrangements appears to have been somewhat fluid over the period between the preparatory work for the Dick Smith unit, that commenced in August 2011 and the final entry into the greenfields agreement on 9 December 2011. So much appears from the evidence of Mr Smith of SDA, about the initial scope of what was planned, which did not include the Dick Smith business. 34 It is, of course, one thing for an employer to take over or re-badge an existing "enterprise", as defined in s 12 of the Act, and another for it to create a new one. The objective character and identity of the enterprise to which the agreement will apply and its novelty in relation to the employer's business (or that of the group of which they form part as single interest employers within the meaning of s 172(5)) may be relevant considerations for the tribunal of fact: Patrick Cargo Pty Ltd v Transport Workers' Union of Australia (2002) 115 IR 443 at 446-447 per Munro J, Duncan SDP and Roberts C. 35 Woolworths established HP Distribution to arrange for the distribution of goods for three significant business units within the overall Woolworths organisation. That was a new business activity, project or undertaking. It would be conducted from one location. Staff employed by HP Distribution at the Hoxton Park precinct would be able to move from one part to another to service the requirements of the distribution activities as they changed or developed. Woolworths had not previously established such an enterprise, although some preparatory work had been done in a preliminary fashion by persons employed by Action Work Force in relation solely to the Dick Smith indent storage arrangements. The scope, structure and direction of the way in which the two sheds were to operate at the Hoxton Park precinct was not the same as the undertaking or work of the labour supplied by Action Work Force when operating, in the preliminary stages, earlier in 2011 at the Hoxton Park precinct. None of the employees who operated that business was employed by any of the Woolworths companies prior to 9 December 2011, as Mr Town made clear. 36 As a matter of practical reality, I am satisfied that the business, activity, project or undertaking which prior to 9 December 2011 Woolworths had contemplated be established at the Hoxton Park precinct was genuinely new and different from an existing enterprise. I reject NUW's argument that the participation of Woolworths in the preparatory planning and development of the enterprise or the agreement meant that HP Distribution could not be said to be the relevant employer. For the reasons above, I am of opinion that s 172(2)(b) envisages that a holding company may do significant preparatory work directed to establishing or proposing to establish a genuine new enterprise that it intends will be conducted by a subsidiary that will be incorporated shortly before the subsidiary enters into a greenfields agreement with a relevant employee organisation. The relationship between the holding company and the subsidiary, together with the amount of preparation cannot preclude, but may be relevant to, the characterisation of the enterprise agreement as a greenfields agreement for the purposes of s 172. 37 It follows that the Full Bench correctly concluded that it had jurisdiction to consider the appeal from, and affirm, the decision of the Commissioner to approve the enterprise agreement as a greenfields agreement. The Full Bench sufficiently explained in its reasons why it found as it did.

HP Distribution's alternate construction 38 I will also deal with the alternative argument put forward by HP Distribution that the Parliament did not intend to require the existence of a greenfields agreement as a jurisdictional fact, as it was fully argued. There is considerable support for such an argument in the terms of s 187(5). The function of the Commission, under s 186(1), was that it had to approve an agreement if the requirements of ss 185, 186 and 187 were met. Importantly, in this respect, s 187(5) recognised that the employees who were to work at the enterprise, the subject of the greenfields agreement, would not have been able to participate in its formulation in the way in which the Act required for the other, more usual, form of enterprise agreement in ss 172(2)(a) and (3)(a). Those provided that an employer could make an enterprise agreement with employees who were employed at the time the agreement was made and who would be covered by the agreement. This gave the employees the right to negotiate for their own future. In contrast, ss 172(2)(b) and (3)(b) operated to impose on incoming employees, an already existing greenfields enterprise agreement that had been negotiated between the employer and a relevant employee organisation before those persons were employed under it in the new enterprise. 39 Importantly, s 187(5) created particular protections for employees that the Commission must be satisfied exist if, and only if, an agreement was a greenfields agreement. Those protections were, namely, first, that the relevant employee organisation was entitled to represent the industrial interests of the majority of employees who would be covered by the agreement, in relation to the work to be performed and, secondly, that it would be in the public interest to approve it. Those two considerations indicate that the Parliament may have intended the Commission to have the role of finding the facts conclusively for itself. Those facts included whether or not an agreement was a greenfields agreement and, if it were, to ensure that the persons who were, in the future, to be employed under it, had the protection of an appropriate employee organisation, as party to the agreement, who would be able to represent the majority of employees' interests and more importantly, that it was in the public interest to approve the agreement. 40 The discretionary judgment concerning the public interest that s 187(5)(b) required the Commission to form, in approving an agreement, is characteristically one that suggests that its role was to look at the interests and welfare of the employees, in particular, prior to approving such an agreement. It also suggests that the approval would give the agreement the force of law under the Act, so that whether or not it could truly be said to be a greenfields agreement that precisely met the jurisdictional requirements in ss 172(2)(b) and (3)(b) could become irrelevant once the Commission had been satisfied and gave approval under s 187(5). 41 However, in my opinion, this is not the correct construction of the Act. That is because the Commission only had power to approve a greenfields agreement under ss 186(1) and 187(5) if the agreement were one actually made under, and meeting the requirements of, s 172(2)(b) or (3)(b). The Parliament intended that unless those requirements were met, employers had to make enterprise agreements with their employees under s 172(2)(a) or (3)(a). 42 Here, the jurisdictional facts were established before the Commission and before me, that the agreement was an enterprise agreement meeting the characteristics of a greenfields agreement for the purposes of s 172.

Conclusion 43 For those reasons the application must be dismissed. I certify that the preceding forty-three (43) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Rares.