Fair Work Act 2009

s.236 - Application for a majority support determination

MSS Security Pty Ltd T/A MSS Security employees engaged to provide security services - jurisdictional objection - no jurisdiction to issue majority support determination where bargaining initiated - application dismissed.

[1] An application pursuant to s.236 of the Fair Work Act 2009 (the Act) was made by United Voice (the Applicant) for a majority support determination (MSD) to undertake bargaining for an Agreement to cover employees engaged by MSS Security Pty Ltd (the Respondent) who perform work at Metro South Hospital and Health Service (MSHHS).

[2] The Respondent raised a jurisdictional objection to the application, stating that bargaining had already commenced, in relation to a previous application for the approval of the MSS Security Qld Enterprise Agreement 2014-2018. Pursuant to s.237(2)(b) of the Act, the Commission must be satisfied that the employer has, "not yet agreed to bargain, or initiated bargaining, for the agreement," in order to issue a majority support determination.

[3] There is some history to the approval of the MSS Security Qld Enterprise Agreement 2014-2018. As a result of proceedings before the Full Bench of the Federal Court,[1] and the Full Bench of the Commission,[2] the Agreement was quashed for failing to meet the "better off overall" requirements of the Act. The Respondent submitted that it had already initiated bargaining in relation to that Agreement, and that it was prepared to continue bargaining.

[4] The Applicant submitted that the Notice of Employee Representational Rights (NERR), distributed to employees in 2014 by the Respondent (during bargaining for the Agreement), was no longer effective and that therefore, bargaining had not been initiated and accordingly, there was no impediment to the majority support determination.

[5] The Applicant requested for the jurisdictional objection to be determined prior to the substantive MSD application and directions were set for the filing of material in relation to the jurisdictional objection. The parties agreed for the jurisdictional objection to be determined on the papers. In determining the jurisdictional issue the Applicant proposed the following question for determination:

"Is the NERR issued to relevant employees in May 2014 still effective?"

[6] This decision deals with the determination of the jurisdictional objection; whether bargaining has already commenced pursuant to s.237(2)(b) of the Act. Whilst not all of the submissions and evidence are referred to in this decision, all of such have been considered. The Respondent had also objected to the application, stating that pursuant to s.237(2)(c) of the Act, the group of employees were not fairly chosen. The Applicant sought that this matter may be considered with the substantive matter, and material was filed in relation to these matters.

[7] Pursuant to s.237 of the Act:

"237 When the FWC must make a majority support determination

(1) The FWC must make a majority support determination in relation to a proposed single-enterprise agreement if:

(a) an application for the determination has been made; and

(b) the FWC is satisfied of the matters set out in subsection (2) in relation to the agreement.

Matters of which the FWC must be satisfied before making a majority support determination

(i) who are employed by the employer or employers at a time determined by the FWC; and

(b) the employer, or employers, that will be covered by the agreement have not yet agreed to bargain, or initiated bargaining, for the agreement; and

(c) that the group of employees who will be covered by the agreement was fairly chosen; and

(d) it is reasonable in all the circumstances to make the determination.

(3) For the purposes of paragraph (2)(a), the FWC may work out whether a majority of employees want to bargain using any method the FWC considers appropriate.

(3A) If the agreement will not cover all of the employees of the employer or employers covered by the agreement, the FWC must, in deciding for the purposes of paragraph (2)(c) whether the group of employees who will be covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.

(4) The determination comes into operation on the day on which it is made."

[8] The provisions in the Act, relevant to the NERR, are set out as follows:

"173 Notice of employee representational rights

Employer to notify each employee of representational rights

(1) An employer that will be covered by a proposed enterprise agreement that is not a greenfields agreement must take all reasonable steps to give notice of the right to be represented by a bargaining representative to each employee who:

(b) is employed at the notification time for the agreement.

Note: For the content of the notice, see section 174.

(2) The notification time for a proposed enterprise agreement is the time when:

(a) the employer agrees to bargain, or initiates bargaining, for the agreement; or

(b) a majority support determination in relation to the agreement comes into operation; or

(c) a scope order in relation to the agreement comes into operation; or

(d) a low paid authorisation in relation to the agreement that specifies the employer comes into operation.

Note: The employer cannot request employees to approve the agreement under section 181 until 21 days after the last notice is given (see subsection 181(2)).

(3) The employer must give the notice as soon as practicable, and not later than 14 days, after the notification time for the agreement.

Notice need not be given in certain circumstances

(4) An employer is not required to give a notice to an employee under subsection (1) in relation to a proposed enterprise agreement if the employer has already given the employee a notice under that subsection within a reasonable period before the notification time for the agreement.

(5) The regulations may prescribe how notices under subsection (1) may be given."

Single-enterprise agreement that is not a greenfields agreement

(1) If the employees of the employer, or each employer, that will be covered by a proposed single-enterprise agreement that is not a greenfields agreement have been asked to approve the agreement under subsection 181(1), the agreement is made when a majority of those employees who cast a valid vote approve the agreement.

Multi-enterprise agreement that is not a greenfields agreement

(a) a proposed enterprise agreement is a multi-enterprise agreement; and

(b) the employees of each of the employers that will be covered by the agreement have been asked to approve the agreement under subsection 181(1); and

(c) those employees have voted on whether or not to approve the agreement; and

(d) a majority of the employees of at least one of those employers who cast a valid vote have approved the agreement;

the agreement is made immediately after the end of the voting process referred to in subsection 181(1).

(3) A greenfields agreement is made when it has been signed by each employer and each relevant employee organisation that the agreement is expressed to cover (which need not be all of the relevant employee organisations for the agreement).

(a) a proposed single-enterprise agreement is a greenfields agreement that has not been made under subsection (3); and

(b) there has been a notified negotiation period for the agreement; and

(d) the employer or employers that were bargaining representatives for the agreement (the relevant employer or employers ) gave each of the employee organisations that were bargaining representatives for the agreement a reasonable opportunity to sign the agreement; and

(e) the relevant employer or employers apply to the FWC for approval of the agreement;

(f) by the relevant employer or employers with each of the employee organisations that were bargaining representatives for the agreement; and

(g) when the application is made to the FWC for approval of the agreement.

Note: See also section 185A (material that must accompany an application)."

SUMMARY OF THE RESPONDENT'S JURISDICTIONAL SUBMISSIONS AND EVIDENCE

[9] The Respondent made a jurisdictional objection on the basis that a majority support determination could not be made as bargaining for the replacement Agreement was ongoing. The Respondent submitted it has already initiated bargaining, and further, it has never opposed bargaining being continued and agreed to continue bargaining.

[10] Ms Margaret Stinson, General Manager People and Culture of the Respondent, provided a statement in these proceedings. Ms Stinson provided a timeline of the bargaining for a new Agreement and its progress through the Commission (the most recent decision being the Full Bench's decision issued 31 January 2017).[3] The Agreement was quashed on the basis that it was not compliant with the "better off overall test."

[11] Ms Stinson stated that she was unaware of any attempts by the Applicant to continue bargaining for the Agreement, and that the Respondent is, "ready and willing," to continue bargaining. On the evidence provided by Ms Stinson and on the submissions of both parties, there was no reference to any negotiations or meetings that had occurred since the Agreement was quashed.

[12] The Respondent submitted that the NERR distributed in 2014 was still effective, and that bargaining was ongoing, on the following grounds:

"(a) MSS Security had already initiated bargaining in May 2014 (i.e. the notification time);

(b) MSS Security had already taken reasonable steps in May 2014 to notify to each employee who:

(i) would be covered by the agreement (to replace the Qld EA); and

(ii) was employed at the notification time for the agreement.

(c) The NERR relates to the bargaining for a proposed enterprise agreement to replace the enterprise agreement that currently covers the Relevant Employees (i.e. the Qld EA)

(d) MSS Security is not required to give another NERR in relation to the bargaining for a proposed enterprise agreement to replace the Qld EA (which is the subject of the 2014 NERR)."[4]

[13] It was submitted that there is no requirement under the Act for the Respondent to issue a new NERR if an Agreement had been voted up, regardless of whether or not it was subsequently approved by the Commission. In support of this submission, the Respondent referred to s.173(4) of the Act, where the Notice need not be given in certain circumstances and submitted that a new NERR was not required.

[14] The Applicant has made submissions with respect to the Fair Work Amendment (Notice of Employee Representational Rights) Regulations 2017 and its impact on the NERR issued in 2014. The Respondent submitted that the Regulations were not relevant to the NERR, and referred to the Explanatory Statement to the Regulations that stated:

"The amendments made by the Amending Regulations will only apply to Notices that are given to employees on and from 3 April 2017. Notices that were issued in accordance with the requirements of the Fair Work Act before 3 April 2017 will not be affected by these amendments."

[15] The Respondent relied upon the Explanatory Memorandum to the Fair Work Bill 2008 to submit that the concept of a, "bargaining period," was not contemplated within the Act and therefore, no such period would conclude. The Respondent referred to the following provisions of the Explanatory Memorandum:

"r.312 The concept of a bargaining period has been removed in the Bill, although industrial action will continue to be protected during bargaining for an enterprise agreement. FWA will be required to order industrial action to end if it is causing or may cause significant harm to the Australian economy or to the safety or welfare of the community.

1630. The current WR Act regulates industrial action and allows for protected action to be taken during a bargaining period so long as certain requirements are met. Although the Bill no longer contains the concept of a bargaining period, protected industrial action is only available during bargaining for an enterprise agreement."

[16] The Respondent submitted that the 2014 NERR should still be considered effective, as it was not affected by the Regulations, nor s.173(4) of the Act. Accordingly, it was submitted that the application should be dismissed on the basis that a majority support determination cannot be issued where bargaining is continuing.

SUMMARY OF THE APPLICANT'S JURISDICTIONAL SUBMISSIONS AND EVIDENCE

[17] The Applicant submitted that the bargaining period ceased upon the prior Agreement being approved, in accordance with s.182 of the Act and quashed accordingly, and that the ability of bargaining representatives to engage in further negotiations had ended. Further, it was submitted that the associated NERR provided on 20 May 2014 was consequently nullified.

[18] The Applicant submitted the NERR was related to bargaining for a specific Agreement and that further negotiations would be in relation to a new proposed Agreement, and therefore would require a new NERR.

[19] Further, it was submitted that the Fair Work Amendment (Notice of Employee Representational Rights) Regulations 2017 as commenced on 3 April 2017 affected the form and content of the NERRs. Accordingly, the Applicant submitted that strict compliance with the Regulations required a new NERR to be issued.

[20] The Applicant disputed the Respondent's submission that it had not declined to continue bargaining and that it was ready to continue bargaining. The Applicant argued there had not been any indication prior to their submissions, that the Respondent considered bargaining to be ongoing. The Applicant submitted s.237(2)(b) can be satisfied on this basis.

[21] This decision relates to a jurisdictional objection raised by the Respondent, that the Commission does not have jurisdiction pursuant to s.236 of the Act, to make a majority support determination, on the basis that bargaining had already commenced.

[22] The Full Bench in Uniline Australia Limited contemplates a NERR being reissued where the original NERR was found to be invalid.[5] This is distinguishable from the circumstances in this application, where the validity of the NERR is not in dispute, therefore the NERR continues to apply.

[23] The NERR in this matter was validly issued, in accordance with the requirements of the Act. Accordingly, as contemplated in Uniline,[6] the NERR issued relevant to the Agreement quashed by the Full Bench,[7] continues to have effect.

[24] It is noted that should the NERR have contained a fundamental flaw or failed to meet a relevant requirement of the Act, then it would require bargaining to start afresh with a new notification time, and a valid NERR issued consequently, such as were the circumstances in Uniline. In this case, the Agreement was quashed for failure to pass the "better off overall test," therefore, it follows that it is available to the parties to continue bargaining for the Agreement.

[25] The submissions of the Respondent are accepted, that there has not been a denial to continue bargaining. The submissions regarding the Fair Work Amendment (Notice of Employee Representational Rights) Regulations 2017 are also accepted, that it does not apply to the NERR as it was issued prior to those Regulations coming into effect.

[26] With regards to the substantive MSD application, it is has been taken into account (as per correspondence with the parties) that a majority of employees do wish to bargain for a new Agreement. However, as the NERR continues to have effect and there has not been a refusal from the Respondent to continue bargaining, bargaining has been initiated. Therefore there is no jurisdiction for a majority support declaration to be made, given that one of the pre-requisites, pursuant to s.237(2)(b), is that, "the employer, or employers, that will be covered by the agreement have not yet agreed to bargain, or initiated bargaining, for the agreement."

[27] It is noted that the Applicant seeks to confine bargaining for the Agreement to only those employees working at MSHHS, thus changing the scope of employees who bargained for the original Agreement. That narrower scope is a matter for the Applicant to raise in bargaining, or to separately pursue.

[28] In regards to the Applicant's alternative argument, that the composition of the employees who agreed to bargain has changed since the time the NERR was issued, it is not necessary to determine given that an MSD cannot be made as bargaining has commenced.

[29] For the above reasons, the application is dismissed. I Order accordingly.

[1] United Voice v MSS Security Pty Ltd [2016] FCAFC 124.

[2] United Voice v MSS Security Pty Ltd [2017] FWCFB 651.

[4] Submissions of MSS Security (NERR) dated 10 November 2017.

[5] Uniline Australia Limited [2016] FWCFB 4969.

[7] United Voice v MSS Security Pty Ltd [2017] FWCFB 651.

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