Did the primary judge err in holding that there was jurisdictional error affecting the Commission's satisfaction that the Agreement had been "genuinely agreed to" having regard to para 188(c)?
122 The substance of the primary judge's reasons for concluding that the Commissioner's decision on this question was affected by jurisdictional error appears at [122]-[123]. The primary judge held that the Commissioner could not lawfully have been satisfied that the Agreement had been genuinely agreed to by the employees covered by the Agreement because:
(1) he had failed to give any or "any adequate or proper" consideration to:
(a) the differences in the work performed by the three employees with whom the Agreement was made and the work covered by the other awards; and
(a) having regard to those differences, whether it was appropriate to seek their agreement and whether they were capable of giving it; and
(2) there was no evidence that the Agreement had been genuinely agreed to by the employees covered by the Agreement, which the primary judge took to include the prospective employees who would otherwise have been covered by the various other modern awards.
123 The basis for the first reason included a concern earlier expressed (at [116]) that three employees "with a very confined employment experience" and covered by only two of the 11 awards could approve an agreement that would cover employees covered by the diverse range of awards which the Agreement was to replace. Such an agreement, his Honour held, would "lack 'authenticity' and 'moral authority'", picking up on expressions used in Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (1999) 93 FCR 317 (CFMEU v AIRC) at [126]-[127].
124 In relation to the second reason, the primary judge distinguished s 186(2)(a), which provides that the Commission "must be satisfied that the agreement has been genuinely agreed to by the employees covered by the agreement", and s 180(2), which sets out a pre-voting obligation to provide materials to "relevant employees", who are defined as "the employees … employed at the time who will be covered by the agreement". He said that the phrase in s 186(2)(a) ("employees covered by the agreement") was "deliberately wider in ambit" than the definition in s 180(2).
125 According to the CFMEU, this aspect of the primary judge's reasons went to para (c) of s 188: the Commission's satisfaction that there were "no other reasonable grounds for believing that the agreement had not been genuinely agreed to by the employees". OKW disagreed, pointing to the absence in the reasons of any reference to para (c) and suggested instead that the primary judge was concerned with s 186(2)(a) alone, treating it as if it were framed in the same general terms as the question of genuine agreement under s 170LT(6) of the Workplace Relations Act 1996 (Cth) (the subject of the discussion in CFMEU v AIRC).
126 We accept the CFMEU's submission. The absence of a specific mention of para 188(c) in this context is neither here nor there. There can be no doubt that his Honour was alive to the terms of para (c). His Honour had set out the entirety of s 188 at [29] of his reasons. He also referred (at [46]) to the discussion of para 188(c) by the Full Bench of the Commission in Maritime Union of Australia v MMA Offshore Logistics Pty Ltd [2017] FWCFB 660 at [76]; (2017) 263 IR 81 at 112. At [80] he pointed out that one of the CFMEU's contentions was that the Commissioner's assessment of whether the employees had genuinely agreed to the Agreement "within [the] meaning of [ss] 186(2)(a) and 188(c)" was vitiated by jurisdictional error. Moreover, it should not be assumed that a judge is in error when an alternative construction of his reasons is open.
127 OKW submitted that the "central defect" in the primary judge's reasoning was his reliance on the difference in the language of ss 180(2) and 186(2)(a). A similar distinction was drawn by the majority of the Full Court in Shop, Distributive and Allied Employees Association v ALDI Foods Pty Ltd (2016) 245 FCR 155. In substance, OKW argued that his Honour misunderstood the reason for the difference, which it attributed to the different stages of the approval process to which the different provisions applied.
128 With respect, the distinction the primary judge drew between the language of s 186(2)(a) and s 180(2) was wrong. The High Court so held in ALDI. The "employees covered by the agreement" (s 186(2)(a)) are the same employees as those "employed at the time who will be covered by the agreement" ("the relevant employees") (s 180(2)). The description of the employees in s 180(2) is the same as that used in s 172. As the plurality explained in ALDI at [77]:
At the stage of considering whether an enterprise agreement is available to be made under s 172 of the Act, ie when no agreement has as yet been made, it is a natural and ordinary use of language to speak of the employees whose jobs are within the scope of the proposed agreement as employees who "will be covered" by the agreement. At the stage of considering whether an enterprise agreement, which has been made (by virtue of s 182(1)), should be approved pursuant to s 186(2)(a), it is a natural and ordinary use of language to speak of the employees, whose jobs are described by the terms of the agreement which has been made, as employees who "are covered" by the agreement.
129 It follows that the second reason given by the primary judge (that there was no evidence that the employees who would otherwise have been covered by the various other modern awards had genuinely agreed to the Agreement) was erroneous; it was based on a misinterpretation of the Act.
130 In the terms in which it was expressed, the first reason is also problematic. Contrary to the submissions of OKW, however, his Honour's concerns were not misplaced and his conclusion that the Commissioner fell into jurisdictional error was correct.
131 OKW argued that his Honour was distracted by an "extraneous notion of 'authenticity' or 'fairness' or 'moral authority'". It emphasised that an enterprise agreement was "a creature of statute" and not an agreement in the ordinary or common law sense. It submitted that the concept of genuine agreement as it appears in the Act is a defined term under s 188 and "no further gloss" can be placed on it. If the primary judge is to be taken to have been considering the question of agreement in the context of s 188(c), OKW submitted the CFMEU had to prove "that the Commission could not reasonably have formed its state of satisfaction that there were no other reasonable grounds for believing that the Agreement had not been genuinely agreed to".
132 While an enterprise agreement is, indeed, a creature of statute and the concept of genuine agreement is a defined term, OKW's arguments must be rejected.
133 As we mentioned earlier, his Honour's references to "authenticity" and "moral authority" are taken from CFMEU v AIRC.
134 CFMEU v AIRC related to an agreement entered into between a mining company (Mine Management) and its 22 employees, none of whom was involved in the operation of the mine at the time he or she was called upon to approve, and did approve, the agreement. Mine Management applied to the Commission for the agreement to be certified under s 170LT of the Workplace Relations Act.
135 Section 170LT of the Workplace Relations Act was introduced in 1996 in a new Part VIB (the predecessor to Part 2-4 of the Fair Work Act), which was concerned with the certification of certain agreements, particularly at the level of a single business or part thereof: see s 170L. Section 170LT set out the matters of which the Commission had to be satisfied in order to certify an agreement. Sub-section (6) required that a "valid majority of persons employed at the time whose employment would be subject to the agreement must have genuinely made the agreement".
136 After referring to s 170LT(6), Wilcox and Madgwick JJ made the following remark at [126]:
This plainly betokens a concern with the authenticity and, as it were, the moral authority of the agreement. It is perfectly understandable - indeed, one might reasonably think, plainly necessary - this be so.
137 This observation was based on what their Honours regarded as the lack of understanding the parties to the agreement must have had because of their lack of "actual experience of the work and its place of performance" (at [126]).
138 The legislative source upon which their Honours drew for the concept of "the moral authority of the agreement" was the principal object of the Workplace Relations Act (the provision of a framework for cooperative workplace relations) and the means by which this was to be achieved (both set out in s 3 of the Act). Their Honours emphasised the reference in para (e) of s 3 to "fair and effective" agreement-making. Their Honours then stated (at [126]-[127]):
There can hardly be fair agreement-making between employer and employees about wages and employment conditions in a workplace (a mine is a good example) before both sets of parties have actual experience of the work and its place of performance. Without that, cooperative workplace relations are unlikely to be achieved. An agreement prematurely made is unlikely to be effective; measuring effectiveness in this context by such matters as durability, aptness and comprehensiveness. Established "safety net" standards are less likely to be respected and maintained, because the range of conditions in relation to which such standards exist may not have been fully comprehended.
In short, the Act clearly indicates a concern for fairness and efficacy in agreement-making, as well as flexibility. The subject matter of the Act makes it understandable Parliament had such concerns. A consideration of those concerns supports the interpretation we consider preferable on more narrow grounds.
139 In this appeal, OKW submitted that authenticity and moral authority have nothing to do with para (c) of s 188. It sought to distinguish CFMEU v AIRC on the basis that, unlike the Fair Work Act (through s 188), the Workplace Relations Act did not define the circumstances in which an agreement has been genuinely made. OKW argued that the sole focus of para 188(c) is upon the nature and quality of the agreement of the relevant employees (in this case the three men who were employed at the time of the vote). OKW rejected the notion that the Act was concerned to try and ensure that the will of the employees who vote is sufficiently representative of those employees who will be covered by the agreement. OKW submitted that the Act does not contemplate that existing employees who vote on the agreement are statutory proxies for the innominate group of prospective or subsequent employees. It argued that para (c) was only addressing matters that vitiate the nature and quality of the agreement such as fraud, duress, and coercion.
140 In construing the meaning of the phrase "genuinely agreed", orthodox principles of statutory construction are to be applied. The starting point must always be the text of the statute, a point the High Court has emphasised in many cases including Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at [47] (Hayne, Heydon, Crennan and Kiefel JJ). In interpreting any statutory provision, however, context (including legislative purpose and history) is to be considered from the outset, not just in the case of perceived ambiguity: CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) ALR 405; 91 ALJR 936 at [14] (Kiefel CJ, Nettle and Gordon JJ). In SZTAL their Honours went on to say:
This is not to deny the importance of the natural and ordinary meaning of a word, namely how it is ordinarily understood in discourse, to the process of construction. Considerations of context and purpose simply recognise that, understood in its statutory, historical or other context, some other meaning of a word may be suggested, and so too, if its ordinary meaning is not consistent with the statutory purpose, that meaning must be rejected.
If the words of the provision are capable of more than one interpretation, a construction that would promote the purpose or object of the Act, whether or not expressly stated, is to be preferred to every other interpretation: Acts Interpretation Act 1901 (Cth), s 15AA.
141 Turning then to the language utilised in ss 186(2)(a) and 188(c), the word "genuinely" in the phrase "genuinely agreed", indicates that mere agreement will not suffice and that consent of a higher quality is required. We reject OKW's contention that the phrase is only directed at requiring an absence of fraud, coercion or duress in the process of employees providing their agreement. The word "agreed" on its own, suffices to achieve those ends. The word "genuinely" must be given some additional work to do. A court construing a statutory provision must strive to give meaning to every word of it: Project Blue Sky at [71]. The limits OKW seeks to put on para 188(c) are too narrow. The requirement for genuine agreement in the Fair Work Act prescribes some, but not all, factors that must be taken into account. In this respect, in contrast to its predecessor, s 170LT(6) of the Workplace Relations Act, paras 188(a) and (b) direct the Commission's attention to a number of discrete matters. Paragraph 188(c), however, it is not at all prescriptive.
142 Paragraph 188(c) is cast in very broad terms. It is intended to pick up anything not caught by paras (a) and (b). Thus, any circumstance which could logically bear on the question of whether the agreement of the relevant employees was genuine would be relevant. One obvious example is the provision of misleading information or an absence of full disclosure (see, for example, Re Toys "R" Us (Australia) Pty Limited Enterprise Flexibility Agreement 1994 (1995) 37 AILR 3-068 (Print L9066) (C No 23663 of 1994)). Another is the likelihood that the relevant employees understood the operation of the various awards that would be affected by the agreement and the extent to which the wages and working conditions for employees under each of those awards would change, for better or worse, under the terms of the agreement. Thus, if we be wrong to conclude that the Commission is bound by s 180(5) to consider the content of the employer's explanation of the terms of the Agreement and their effect, in order to be satisfied that the Agreement was "genuinely agreed to" having regard to s 188(a)(i), then for similar reasons we would hold that this was a matter which was not only relevant to the question raised by para 188(c), but was a mandatory consideration.
143 Furthermore, contrary to OKW's submission, authenticity is not irrelevant to para 188(c). To the contrary, it goes to the heart of the matter. Recourse to a standard dictionary of the English language tells us that "authentic" is a synonym for "genuine". The editor of the Oxford English Dictionary online notes that "[t]he distinction which the 18th [century] apologists attempted to establish between genuine and authentic … does not agree well with the etymology of the latter word, and is not now recognised".
144 The significance of the word "genuinely" as used in ss 186(2)(a) and 188(c) is best understood by referring to some matters of context.
145 Enterprise agreements are an important feature of the Fair Work Act. Together with the NES and modern awards, enterprise agreements constitute the sources of the main terms and conditions of employment provided by the Fair Work Act: see s 5(2).
146 Enterprise agreements provide employees with a means of improving their terms and conditions of employment beyond the floor of minimum terms and conditions of employment provided for by the NES and modern awards. For employers, the making of enterprise agreements can provide greater flexibility and enhanced productivity. Subject to compliance with the BOOT, many of the terms and conditions of employment required by modern awards may be supplanted by terms and conditions more suited to the employer's enterprise. Section 3 of the Fair Work Act states that the object of the Act is "to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians" by a number of means. One, specified in para (f) is:
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;
147 Three aspects of that paragraph should be noted. First, the ultimate goal of agreement-making is achieving productivity and fairness. What is meant by fairness is not defined but may be presumed to contemplate, at least as a goal, that the legitimate expectations of both employers and employees are embodied in the enterprise agreements made between them. Second, emphasis is given to "enterprise-level" agreement making. Third, the means by which agreements of that nature are to be made is "collective bargaining".
148 Each of these three characteristics is reflected in the objects of Part 2-4 in which ss 186(2) and 188 are found. Section 171(a) states that an object of Part 2-4 is:
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[.]
149 Collective bargaining is a well-known process for resolving industrial disputes. It is recognised and promoted by conventions of the International Labour Organisation, principally the Right to Organise and Collective Bargaining Convention (No 98) (1949) (entered into force 18 July 1951), which Australia ratified on 28 February 1973. Collective bargaining, as a formal process for resolving industrial disputes, was introduced into federal industrial legislation by amendments made to the Industrial Relations Act 1988 (Cth) in 1994 by the Industrial Relations Reform Act 1993 (Cth). Simply put, collective bargaining is a process in which employees bargain with their employer as a collective, rather than as individuals. It is a process which is designed to overcome the power imbalance between an employer and an employee bargaining alone.
150 In relation to the setting of terms and conditions of employment, the Fair Work Act expresses a preference for collective bargaining and disapproval of individual bargaining. Individual bargaining for statutory employment agreements available under the Workplace Relations Act through the making of what were called "Australian Workplace Agreements" was not continued by the Fair Work Act. The legislative distaste for individual bargaining and individual agreement making is expressed in strong language in s 3(c) of the Fair Work Act, which states that individual employment agreements "can never be part of a fair workplace relations system". The strong preference of the Fair Work Act for collective bargaining must logically be anchored in an acceptance of the proposition that collective bargaining has characteristics more likely to facilitate a fair workplace relations system than does individual bargaining.
151 An enterprise agreement made early in the life of an enterprise with two or three employees and before the employment of the much larger workforce necessary to operate the business of the enterprise is, in terms of the process by which it was made, far more likely to reflect characteristics akin to individual bargaining than collective bargaining. As the facts of this case demonstrate, there will be no bargaining with the collective of employees because, in substance, the collective is yet to be formed. In the absence of any real opportunity for employees to form an effective collective, the power imbalance will reflect that of individual bargaining. As the Full Court said in a similar context in Construction, Forestry, Mining and Energy Union v Pilbara Iron Company (2011) 194 FCR 269 at [38]:
If it were possible for an employer to choose any employees it wishes, and to designate them as the employees in part of its single business with whom it wishes to make a collective agreement, the underlying purpose of promoting collective negotiation might be subverted.
152 Still, it is abundantly clear that an enterprise agreement may be made with two or three employees and, in relation to a new enterprise, may be made as a non-greenfields agreement where some employees of the enterprise are already employed (see ALDI at [76]). That that should be so is not really surprising. Enterprises come in all shapes and sizes. Nor, as the High Court observed at [84] in ALDI, is it implausible for the legislature to have intended that a small group of employees should be able to fix the terms and conditions of employment of a larger group of employees who are later employed and covered by the enterprise agreement.
153 But it does not follow from the fact that agreement-making of that kind has not been prohibited by the Fair Work Act that the Act is unconcerned with agreement-making that may undermine or subvert its preference for collective bargaining. That concern, as the High Court observed in ALDI at [84] and [87], is addressed not by prohibition but by the Fair Work Act's "protective provisions".
154 Section 186(3) (the "fairly chosen" requirement) is one example of such a "protective provision". A primary purpose of this provision is to avoid the workforce of an enterprise being broken up into artificial employee groupings with the consequence that the workforce of the enterprise is unable to bargain as a single collective: see Aerocare Flight Support Pty Ltd v Transport Workers' Union of Australia [2018] FCAFC 74 at [19] (Jagot, Bromberg and Rangiah JJ). Another example of a protective provision referred to by the High Court in ALDI is the BOOT. Each of those provisions is an element of the approval process specified by Sub-division B of Part 2-4. Like those provisions, other provisions of that sub-division, including ss 186(2) and 188, have a protective purpose. That s 188 harbours a concern directed at agreements made by a small number of employees in circumstances where the agreement covers a wider range of employee classifications is confirmed by [824] of the Explanatory Memorandum which provides:
Note that where an agreement covers a large number of classifications of employees in which no employees are actually engaged there may be a question as to whether the agreement has been genuinely agreed - see clause 188.
155 Where employees working in few occupational classifications consent to an agreement which covers numerous other occupations or other occupations in many industries beyond their own, an explanation of the terms of the agreement and their effect may fall short of providing an adequate basis for the formation of genuine consent. The employees who voted may be indifferent to the impact of an agreement on other employees or prospective employees in occupational classifications outside their own training or experience. As Buchanan J observed in John Holland (Besanko and Barker JJ agreeing), in those circumstances the employees will presumably act out of self-interest (at [33]) with the possible result that "it may not be fair for an enterprise agreement made with three existing employees to cover a wide range of other classifications and jobs in which they may have no conceivable interest" (at [83]).
156 Therein lies the concern. The legislative objective of achieving "fairness through an emphasis on enterprise-level collective bargaining" could be undermined if the employees who vote on the agreement have no basis for appreciating its nature and terms. What is required by s 186(2)(a) is genuine agreement. To construe that requirement as mandating an informed and genuine understanding of what is being approved is consistent with the text of the provision (as defined) and accords with its underlying purpose.
157 Ordinarily, non-greenfields agreements are made with the participation of the employees who are representative of the range of employee classifications covered by the enterprise agreement. The capacity to provide consent based upon a true understanding of the consequences of the proposed agreement across the breadth of classifications covered is likely to be adequate, including because representatives of each classification or classificational grouping will be involved. While it is correct to say, as OKW submitted, that the group of employees who vote are not required by the Fair Work Act to be representatives for, or agents of, the wider group of employees who may ultimately be covered by the agreement, the fact that the group does not broadly reflect the occupational scope of the proposed agreement restricts the terms and conditions in the agreement for which the group can genuinely speak.
158 Support for this construction is found in the approach taken by the Fair Work Act in relation to greenfields agreements. There is no provision in the Fair Work Act which expressly requires that a greenfields agreement be genuinely approved. In the case of greenfields agreements, a representational connection is utilised to condition and ensure the quality of the approval.
159 The corresponding requirement to s 186(2)(a) for greenfields agreements is s 187(5). Section 187(5) provides:
If the agreement is a greenfields agreement, the Commission 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.
160 It is only employee organisations (taken as a group) that are "entitled to represent the industrial interests of the majority of employees who will be covered by the agreement" that may approve a greenfields agreement. That capacity is not given to any union but the union or unions who, by reason of their representational interests, may be expected to have a stake in, and a real or true understanding of, whether the terms and conditions offered by the proposed enterprise agreement are fair and reasonable. Although the circumstances in which greenfields agreements are made require a different mechanism for approval, it should not be thought that, in relation to the making of non-greenfields agreements, where employees may well be more vulnerable, Parliament intended a lower threshold of protection. In each case, a concern with the substantive validity or qualitative legitimacy of the approval given is apparent.
161 OKW also submitted that the primary judge's construction was erroneous because it was influenced by a concern that there is something inherently wrong, and therefore impermissible, in the idea that a small number of employees may be able to fix the terms and conditions that will be available to a larger number of future employees. OKW contended that the concern was misplaced and the High Court confirmed as much in ALDI.
162 This submission must also be rejected. Although the primary judge did not have the benefit of the High Court's judgment in ALDI, he did not consider that there was "something inherently wrong" or "impermissible" in the idea of a small number of employees fixing the terms and conditions of a much larger number of future employees. Indeed, his Honour said at [115] (referring to John Holland) that there was "no difficulty" with a small number of employees entering such an agreement. But his Honour also recognised, correctly in our view, that an agreement of that sort may raise, and in this case did raise, a question about the genuineness of that approval.
163 After the Commissioner's decision, in very similar circumstances, a Full Bench of the Commission held that an enterprise agreement was "incapable of approval" because there were "reasonable grounds for believing" that it had not been genuinely agreed to by the employees of the company: Re KCL Industries Pty Ltd [2016] FWCFB 3048; (2016) 257 IR 266 at [29]-[36]. In that case, the Full Bench said at [31]:
In this matter there is an obvious disjunction between the content of the Agreement and the characteristics of those who entered into it. The Agreement describes itself as applicable to all employees of KCL, whether full-time, part-time, casual or temporary. It sets out classifications and pay rates for private sector clerical employees, manufacturing employees, and production and staff employees in the black coal mining industry (with the last category including classifications for surveyors, safety officers, deputies, forepersons, open cut overseers, geologists, chemists, production supervisors and undermanagers) …
164 The statutory declaration supporting KCL's application for approval of the Agreement indicated that three employees, two of whom were casuals, would be covered by the Agreement. All three were tradespersons working under the Manufacturing and Associated Industries and Occupations Award. The Full Bench noted at [36], however, that the Agreement covered a wide range of classifications (most of which were irrelevant to the work performed by KCL's three employees), encompassed industries in which KCL did not then operate, and contained rates of pay which, even in respect of classifications relevant to the current three employees, were not to apply to them. The Full Bench then said:
In those circumstances we do not consider that any authenticity could attach to the agreement of the two employees to the rates and conditions in the Agreement. The employees had no "stake" in the Agreement's rates of pay, since they were assured that their existing, higher rates of pay would remain in place (subject to "operational needs and satisfactory performance"), and they could not have given informed consent in relation to occupations and industries in which they did not work and presumably had no experience.
(Footnotes omitted, emphasis added.)
165 It will be apparent that the approach taken by the Full Bench in KCL is consistent with our opinion on the proper construction of the phrase "genuinely agreed to" in ss 186(2)(a) and 188(c).
166 The primary judge (at [120]) considered that the Commissioner had initially been alive to the concern that the proposed agreement was too broad for the three employees concerned to have genuinely agreed to it. The Commission had emailed OKW on 18 September 2015 expressing the view that, for that reason, the Commissioner was not then "satisfied that the Agreement was genuinely agreed to": see [53] above. A response was provided on behalf of OKW on 30 September 2015: see [56] above. The primary judge observed (at [122]) that OKW's letter canvassed in considerable detail the authorities, such as John Holland, in support of the proposition that three employees may be asked to make an agreement even though the agreement may potentially apply to a much larger number of employees once approved. The primary judge noted, however, that the letter did not address the ability or appropriateness of the three employees with their limited employment backgrounds being called upon to agree to terms and conditions covering a vast range of employees in diverse areas of employment. His Honour inferred that, in that context, the Commissioner had ultimately failed to give "any - or any adequate or proper" consideration to those matters and that that failure exposed jurisdictional error.
167 At the hearing on 26 October 2015, the Commissioner, in opening remarks, referred to the concerns that he had raised in correspondence with OKW and said this:
And we did express some concerns about whether employees had genuinely agreed and had access to the relevant material. We're satisfied, from the information provided, that the employees did have access to the relevant awards and so I think that that issue has been sorted out.
In terms of the scope of the agreement, of course there's no, in principle, problem with an agreement with three employees having a broader future scope. That's obviously not an issue but, of course, it is possible when there is an agreement of this sort that it raises questions as to whether or not there has been a genuine agreement. But, at this stage, there's nothing that is of particular concern in respect of that.
168 It is not readily apparent why the Commissioner was no longer troubled by his initial concern (raised in his email of 18 September 2015) about whether the agreement had been "genuinely agreed" to. It is clear, however, that the Commissioner did not believe he needed to consider whether, in the light of the small number of employees and the large number of awards, he could be satisfied that the three employees had understood the Agreement and its effect before casting their votes. On the face of the material before the Commission there was a vast disparity of occupational classifications as between those held by the three individuals who voted and the classifications covered by the Agreement. How it was that the three employees might be regarded as having had a sufficient appreciation of the appropriateness of the terms and conditions proposed for the disparate occupational classifications covered, including in industries foreign to their own, was not identified by the Commissioner as a factor relevant to the genuineness of the approval and was not the subject of his consideration. Whether the three employees had appreciated the terms and conditions provided for by the Agreement, beyond those of direct interest and relevance to them, and thereby "genuinely agreed" to its terms (not just those that directly affected them) should have been considered. As the primary judge held, the Commissioner's failure to do that evinced jurisdictional error.
169 In our view the nature of the Commissioner's error is best described as a failure to perform the statutory task required of him. This form of jurisdictional error was described by Gaudron J in Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at [82]:
A decision-maker falls into jurisdictional error if he or she misunderstands the nature of the jurisdiction to be exercised, misconceives his or her duty, fails to apply himself or herself to the question to be decided or misunderstands the nature of the opinion which he or she is to form. By failing to appreciate that it was necessary for there to be something in the nature or seriousness of Mr Taylor's criminal convictions or in the circumstances in which his crimes were committed before she could be satisfied that it was in the national interest to cancel his visa, the Parliamentary Secretary misconceived her duty, failed to apply herself to the question to be decided and misunderstood the nature of the opinion she was to form.
170 Here, in arriving at the opinion required by s 186(2)(a), the Commissioner made a similar error. He failed to appreciate that his statutory task required a consideration of whether the three employees who approved the Agreement were likely to have understood the terms of the Agreement and its effect and whether by reason of that factor, there were reasonable grounds for believing that the Agreement had not been "genuinely agreed" to. In the result, he misconceived his duty, failed to apply himself to the question raised by para 188(c) and misunderstood the nature of the opinion he was to form.