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austlii:cth/FWCA/2025/1296
General information, not legal advice.
FWCA
2025-04-17
Original judgment source is linked above.
s.185 - Application for approval of a single-enterprise agreement
Victorian Hospitals Industrial Association Trading AS Victorian Hospital's Industrial Association
HOLSTEP HEALTH ENTERPRISE AGREEMENT 2024 - 2027
Application for approval of the HOLSTEP HEALTH ENTERPRISE AGREEMENT 2024 - 2027.
[1] The application for approval of the enterprise agreement which is the subject of this decision was made by the Victorian Hospitals Industrial Association (VHIA) on 10 December 2024. The VHIA applies for approval of the enterprise agreement on behalf of its member, Holstep Health, which is the product of the merger between formerly Merri Community Health Services Ltd and Banyule Community Health, which took effect from 1 March 2025.
[2] After making the above application, the VHIA also made an application to amend the name of the enterprise agreement to reflect a change to the name of the employing entity. The agreement as made and for which approval is sought is entitled the Merri Health Enterprise Agreement 2024-2027. Following the amendment application, the name of the agreement for which approval is sought is now the Holstep Health Enterprise Agreement 2024 - 2027 (the Agreement).
[3] The Holstep Agreement will apply to the Banyule Health employees for reason of the transfer of business provisions of the Fair Work Act 2009 (FW Act).
[4] For the purposes of consistency, and unless the context requires otherwise, the Applicant in this matter is referred to in short form as "Holstep".
[5] The Agreement as made is stated to cover 335 employees. The ballot that made the Agreement concluded on 27 November 2024 with 216 employees voting in the ballot, of whom 210 voted to make the Agreement.[1] The scope of the Agreement is;
5.2 a person employed by the Employer in any of the classifications set out in Schedule A to E (Employee); and
5.3 any of the Union(s) named by the Commission as being covered by this Agreement in accordance with Section 183 of Act."
[6] Ascertaining the coverage of the Agreement requires consideration of the classifications set out in its schedules A - E, of which Schedule B is relevant, entitled "Dental/Oral Health Employee Classification Structure". The Schedule is stated to apply only to Dental Therapists, Dental Hygienists and Oral Health Therapists, with 5 classification levels, including a graduate.
[7] After the approval application was made to the Fair Work Commission, it was subject to the usual scrutiny by the Commission's agreement assessment team and then allocated to me for hearing and determination. As part of the prehearing process, the Health Services Union Victoria No. 3 Branch, trading as the Victorian Allied Health Professionals Association (VAHPA) advised it did not support the approval of the Agreement for reason of its view that the employees to be bound by the agreement had not been fairly chosen within the meaning of s.186 of the Fair Work Act 2009 (the FW Act).
[8] The initial correspondence from the Commission to the parties dealing with the prospect of approval detailed three "concerns" held by me, as well as the VAHPA's "fairly chosen" contention. The Applicant was invited to provide submissions or undertakings in response to the Commission's concerns and the bargaining representatives generally were requested to provide submissions relating to the VAHPA's contention. The parties were also informed of the date to hear the application and directed to file submissions for or against its approval.
[9] The application for approval was then the subject of a hearing on Wednesday, 5 March 2025 at which Ms Kelly Ralph, Special Counsel from Russell Kennedy appeared for the Applicant, having been granted permission by me to be represented by a lawyer. Mr Alex Leszczynski: appeared for the VAHPA. Oral evidence was received from Ms Casey Hornby, Holstep's HR Projects Lead and Ms Sabrina Ernst, Oral Health Therapist on behalf of the VAHPA.
[10] The matter of legal representation of the Applicant was opposed by VAHPA, which argued that the requirements of s.596 of the FW Act had not been met.
[11] Prior to the hearing I granted the Applicant permission to be represented by a lawyer, advising the parties I would provide my reasons for doing so in this decision.
[12] VHIA argued that representation by a lawyer was justified for each of the subsections within s.596(2) which are in these terms;
"(2) The FWC may grant permission for a person to be represented by a lawyer or paid agent in a matter before the FWC only if:
(a) it would enable the matter to be dealt with more efficiently, taking into account the complexity of the matter; or
(b) it would be unfair not to allow the person to be represented because the person is unable to represent himself, herself or itself effectively; or
(c) it would be unfair not to allow the person to be represented taking into account fairness between the person and other persons in the same matter."
[13] Relevant to these considerations the VHIA submitted;
• s.596(2)(a) - "The matter involves the operation of section 186(3) and (3A) of the Act, specifically whether the groups to be covered by the proposed agreement were fairly chosen. This is a question of the interpretation of case law and how it should be applied to assist the Commission to determine if the proposed agreement should be approved. That brings with it an inherent degree of complexity."[2]
[14] VAHPA submitted on the subject that the application before the Commission does not bring with it an inherent degree of complexity and that VHIA is a registered organisation which provides services to members such as negotiating enterprise agreements, regularly dealing with the requirements of the Act, including s.186(3) and (3A). VAHPA argue that individuals within VHIA each have the skill and experience to represent their members. VAHPA also argue that no unfairness accrues to the Applicant because of Mr Leszcynski's qualifications, but rather he has the potential to be outnumbered in the hearing with numerous of VHIA's staff attending.
[15] After considering submissions of the parties, I determined that a grant of permission was appropriate, having regard to the potential unfairness that may arise if the Applicant was not represented, as the VAHPA had the benefit of a person experienced in workplace relations matters. My decision in this regard took into account, not only the provisions of s.596(2) of the Act, under which the application for representation was made, but also the reasoning of the Full Bench in ERGT Australia v Mr Kevin Govender, in which it was said;
"[48] The assessment of whether permission should be granted under s 596 involves a twostep process. The first step is to consider whether one or more of the criteria in s596(2) is satisfied. The consideration required by this first step 'involves the making of an evaluative judgment akin to the exercise of a discretion'. It is only where the first step is satisfied that the second step arises, which involves a consideration as to whether in all of the circumstances the discretion should be exercised in favour of the party seeking permission. The satisfaction of any of the requirements set forth in s 596(2)(a) to (c) does not of itself dictate that the discretion is automatically to be exercised in favour of granting permission."[3]
[16] In this regard, I was satisfied that s.596(2)(a) had been enlivened ("it would enable the matter to be dealt with more efficiently, taking into account the complexity of the matter") as well as being satisfied that the Commission's discretion should be exercised in favour of the Applicant.
[17] The consideration within s.596(2)(a) is about the matter of efficiency being brought to the Commission's proceedings for reason of the complexity of the matter being dealt with. Ultimately that is an equation surrounding the value to be added to the proceedings by the lawyer because of their capacity to summarise or focus on only the critical issues and avoid the extraneous. Necessarily the calculus is debatable.
[18] In this matter the subject requiring the Commission's determination is whether the group has been fairly chosen which is not an inherently complex subject, but one which could be made complex with poor quality or unfocussed submissions and evidence. My consideration of the first step as set out in ERGT is that legal representation would likely assist the efficient conduct of the proceedings before me, taking into account its complexity. As to the second step I was persuaded it was appropriate to exercise the discretion in favour of the Applicant. In this regard I did not apprehend an unfairness or other form of imbalance to accrue to VAHPA if permission was granted to VHIA for legal representation.
[19] I do not rely upon either s.596(2)(b) or (c) in granting permission for legal representation.
[20] The thought that industrial officers of a registered organisation of employers are unable to advocate to a sufficient standard for their members on the subjects before me is improbable and if it is the case, suggests the need for urgent training of the staff concerned. The provisions of s.186(3) and (3A) are well settled and an industrial officer dealing with negotiations of enterprise agreements under Part 2 - 4 would likely be well-versed in the matters requiring determination.
[21] Similarly, the proposition that the representation of VAHPA by an experienced industrial officer, even one who is legally trained, creates an unfairness in the Commission proceedings requiring rectification through engagement of an external lawyer is not to be taken seriously. The context of these proceedings is one in which more has been done in connection with the file outside of a hearing room (that is, "on the papers") and the hearing when listed was for the morning, with one witness to give oral evidence on each side. This is not a matter listed for 3 days and receiving contested evidence from 8 witnesses about whom findings of credit must be made. There is no imbalance in this case across the bounds of two registered organisations dealing with an agreed, but objected to, enterprise agreement.
[22] The matters expressed by the Commission to the parties, as being concerns that may impact upon consideration of approval of the Agreement, were identified to the parties on 31 January 2025 and are set out below.
[23] The concerns relate to either or both the Health Professionals and Support Services Award (the HPSS Award) and the Social, Community, Home Care and Disability Services Industry Award (SCHADS Award);
Definition of a shiftworker: Clause 79.2 of the Agreement states that for the purposes of the NES, a Shiftworker is an Employee who: (i) works for more than four (4) ordinary hours on ten (10) or more weekends; or (ii) is regularly rostered to work Sundays and public holidays. Although this is in line with the HPSS Award and partly in line with the SCHADS Award, it is missing the part of the definition of a shiftworker in the SCHADS Award at clause 31.2(b) which states that For the purpose of the NES, a shiftworker is an employee who works at least eight 24-hour care shifts in accordance with clause 25.8 during the yearly period in respect of which their annual leave accrues. We note that clause 25.8 of the Award refers to 24-hour care provisions which may not be relevant under the Agreement and therefore the omission of this part of the definition may not be relevant to any employees. However, the difference in definition raises the issue of non-compliance with s.196 of the Act.
SCHADS Award: Client cancellation: Clause 25.5(f) of the Award provides provisions for when clients cancel. The clause directs that when a shift is cancelled, the employer must either pay the employee what they would've been paid if they had worked, or give the employee make up time. Clause 68 of the Agreement provides for makeup time, however this clause only specifies make up time for periods in which the employee takes time off during ordinary hours to work them at a later time during ordinary hours. The Agreement is silent in relation to client cancellation. It is unclear how frequent client cancellations would be, however this appears to be a potential concern for Part-time employees paid at rates similar to those under the Award.
Both Awards: Ordinary hours: The Agreement appears silent in defining the span of ordinary hours to occur within any given day. Clause 69 provides that overtime only applies in excess ordinary hours on any one day or hours exceeding 10 hours per shift. As such, employees engaged under the Agreement may work hours paid at the ordinary rate which would fall under overtime under either Award. It is unclear whether employees would be engaged in such a pattern, however as certain rates are similar to the Award, rates of pay do not appear high enough to compensate.
[24] These concerns were resolved to my satisfaction through submissions from the Applicant on 7 February 2025 as follows (with no person arguing the concerns were not resolved in the manner referred to below);
1. Definition of shiftworker - the Applicant referred to clauses 79.1 and 79.2 submitting the provisions met the requisite standard, with reference to the Full Bench in Ramsay Health Care Australia Pty Ltd T/A Greenslopes Private Hospital,[4] which observed the provisions of an award or enterprise agreement did not need to be in identical form to the National Employment Standards. This matter is resolved.
"7. The proposed agreement does not have a specific clause that outlines a span of ordinary hours within any given day, but it does contain various clauses that provide penalties/shift allowances for morning/afternoon/night shifts, weekend work penalties and public holidays as per the relevant clauses. What is actually paid to an employee will depend on their work pattern.
8. For information, the employers general business hours are Monday to Friday 8.00am to 6.00pm, currently only two services (medical and dental services) run outside of these ordinary hours. The medical and dental services operation Monday to Friday 8.30am to 6.30pm and Saturday 9.30am to 12.30pm. The employer does not operate services on public holidays. (Note: excluding any individual flexibility arrangements that may be in place)
9. With the exception of casuals, an employee's regular ordinary hours of work are agreed in a contract of employment including the days worked. As a result of sub-clauses 69.1(a)(i) and 69.1(b)(i) full-time and part-time employee receive overtime for any hours in excess of those ordinary hours in each day. Examples as follows:
a. if a full-time employees ordinary hours on any given day is 7.6 hours, any authorized overtime in excess of 7.6 hours will be paid as overtime; and
b. if a part-time employees ordinary hours on any given day is 4 hours, if the employee works authorised overtime of 1 hour they will be paid overtime for that one hour."[5]
[25] By the time of the hearing the Commission's concerns had been resolved, however the VAHPAs concerns remained and need to be determined in this decision.
[26] Shortly stated, the VAHPA's contention is that the Agreement's coverage of Dental Hygienists, Dental Therapists, and Oral Health Therapists (collectively "Oral Health Practitioners") means the Commission is unable to be satisfied the group of employees covered by the agreement has been fairly chosen.
[27] The background to this contest includes that of the 335 Merri Health employees covered by the Agreement, 10 are Oral Health Practitioners.[6] After the merger with Banyule Health, another 7 to 10 Oral Health Practitioners are also covered by the Agreement.[7] The total number of Banyule Health employees now working under the Agreement is not before the Commission, although the total number of employees working for Merri Health (under all instruments) was about 450, which will increase to about 700 when the merger takes effect.[8]
[28] Section 186 of the FW Act provides the following, so far as is relevant about the need to be satisfied the group covered by an agreement is "fairly chosen";
186 When the FWC must approve an enterprise agreement - general requirements
(1) If an application for the approval of an enterprise agreement is made under subsection 182(4) or section 185, the FWC must approve the agreement under this section if the requirements set out in this section and section 187 are met.
Note: The FWC may approve an enterprise agreement under this section with undertakings (see section 190).
Requirement that the group of employees covered by the agreement is fairly chosen
(3) The FWC must be satisfied that the group of employees covered by the agreement was fairly chosen.
(3A) If the agreement does not cover all of the employees of the employer or employers covered by the agreement, the FWC must, in deciding whether the group of employees covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.
[29] The VAHPA submitted, with it not being in contention, that the Agreement covers three groups of employees;
"(a) employees who are Support Services employees under the Health Professionals and Support Services Award 2020 ("the HPSS Award");
(b) a very small group of Employees who are Health Professional employees under the HPSS Award, that is Oral Health Practitioners; and
(c) employees who are Social and Community Services employees under the Social, Community, Home Care and Disability Services Industry Award 2010 ("the SCHCDS Award")."[9]
[30] The core of the VAHPA's objection to the Agreement is that the industrial interests of the Oral Health Practitioners are not served by being covered by the Agreement, and with reference to the provisions of s.186, the Commission is unable to be satisfied that the group covered by the Agreement has been fairly chosen, taking into account whether the group is geographically, operationally or organisationally distinct.
[31] With respect to the elements of s.186(3A), VAHPA submit there is nothing about the group covered by the Agreement that is geographically, operationally or organisationally distinct. With respect to geographical distinctiveness, the union notes that 'the employees who will be covered by the Agreement work across Merri Health's sites, as do employees not covered by the Agreement'.[10]
[32] As to operational distinctiveness, VAHPA notes the predecessor to Holstep Health, Merri Health, worked across 13 different council areas.[11] The union also note there are many employees excluded from coverage of the Agreement including nurses, dentists and employees classified as health professionals under the HPSS award, with the Agreement covering approximately 73% of the Merri Health workforce.[12] VAHPA draw from this that the industrial or productive activity engaged in by employees covered by the Agreement is varied and not distinct;
"33. This means that the industrial or productive activity engaged in by employees covered by the Agreement is varied and not distinct. For example:
(a) Allied Health Assistants assist in the delivery of Allied Health Services;
(b) Dental Assistants assist in the delivery of Dental services;
(c) Health Promotion Officers engaged in Health Promotion; and
(d) Support Workers engaged in the delivery of the Social Support Program
34. Further, even within the various groups of employees engaging in a different industrial or productive activity, the group covered by the Agreement is not distinct. For example, Allied Health Assistants and Allied Health Professionals are engaged in providing Allied Health services to patients/clients/customers of Merri Health, yet Allied Health Assistants are covered by the Agreement whereas Allied Health Professionals are covered by 2022 Agreement.
35. When it comes specifically to Oral Health Practitioners, the industrial or productive activity they provide is dental services. Other employees at Merri Health who provide dental services include Dentists, a Dental Prosthetist and Dental Assistants.
36. However, as noted above, Dentists are covered by the 2023 Agreement and Dental Prosthetists are covered by the 2022 Agreement. This means that, even if we put aside all the other employees covered by the Agreement and only focus on the Oral Health Practitioners and Dental Assistants, there is nothing operationally distinct about this group of employees covered by the Agreement, as employees providing dental services are also covered by the 2022 Agreement and the 2023 Agreement."[13] (footnotes omitted)
[33] VAHPA also put forward that the Agreement covers employees working across each of the Applicant's three operating divisions, aged primary care, family and community, and healthy communities. It puts forward examples of a social worker covered by the Agreement, working in the family and community division; an intake assessment worker engaged in healthy communities divisions; and an allied health assistant working in the aged primary care division.[14] Further;
"40. Breaking down these divisions into these units further demonstrates the group of employees is not distinct. For example, the Allied Health Assistant referred to above in the Aged and Primary Care division is part of the Independent Living Unit and will be covered by the Agreement. However, an Occupational Therapist who is also in the Aged and Primary Care division and is part of the Independent Living Unit is not covered by the Agreement and is instead covered by the 2022 Agreement.
41. This is similarly the case with Oral Health Practitioners who will be covered by the Agreement. They are in the Aged and Primary Care division and work in the Dental unit. By contrast, Dentists, who are also in the Aged and Primary Care division and work in the Dental unit, are covered by the 2023 Agreement rather than by the Agreement."[15]
[34] VAHPA also criticised the Applicant's submission that the Commission should be satisfied the group covered by this Agreement was fairly chosen as the Commission has been satisfied in previous occasions that employees were fairly chosen, including with approval of the 2021 Agreement.[16] The union notes that until the formation of the Agreement now before the Commission, the bargaining representative of the Oral Health Practitioners was the Community and Public Sector Union, submitting that both the CPSU and VAHPA have coverage of oral health practitioners in Victoria. An informal demarcation arrangement between the two unions lasted until 2023, which allowed CPSU to recruit oral health practitioners and negotiate enterprise agreements for them in Victoria in community health centres and public health services. In 2023, the CPSU advised VAHPA it no longer wished to be involved in recruiting or negotiating enterprise agreements for oral health practitioners in community health centres and public health services in Victoria, following which VAHPA commenced its own recruitment and bargaining activities.[17]
[35] VAHPA put forward submissions relating to the industrial coverage of dental practitioners generally, noting that dental hygienists, dental therapists and oral health therapists, (all Oral Health Practitioners) are also protected titles, with persons working in these roles needing to be registered as such with the dental board. The union also submitted that dental practitioners other than OHPs, namely dentists (including specialists dentists) and dental prosthetists , are presently covered by entirely different enterprise agreements;
"(a) Dentists at Merri Health are covered by the Merri Health - Audiologists, Dietitians, Pharmacists, Psychologists and Dentists Enterprise Agreement 2023 - 2027, an enterprise agreement that also covers Health Professional employees under the HPSS Award, including other health professions required to be registered under the National Registration and Accreditation Scheme with the relevant board, namely:
(i) Pharmacists, required to be registered with Pharmacy Board of Australia; and
(ii) Psychologists, required to be registered with the Psychology Board of Australia; and
(b) Dental Prosthetists are covered by the Allied Health Professionals (Victorian Community Health Centres) (Multi-Employer) Enterprise Agreement 2022- 2026 an enterprise agreement that also covers Health Professional employees under the HPSS Award, including other health professions required to be registered under the National Registration and Accreditation Scheme with the relevant board, namely:
(i) Medical Imaging Technologists, required to be registered with the Medical Radiation Practice Board of Australia;
(ii) Occupational Therapists, required to be to be registered with the Occupational Therapy Board of Australia;
(iii) Physiotherapists, required to be to be registered with the Physiotherapy Board of Australia; and
(iv) Podiatrists, required to be to be registered with the Podiatry Board of Australia."[18]
[36] Evidence on behalf of VAHPA was received from its member, Sabrina Ernst, an Oral Therapist. Her evidence was there were 10 Oral Health Practitioners employed by Merri Health, all of whom signed a petition seeking coverage by a different enterprise agreement. She makes the point that Oral Health Practitioners fit poorly within the overall mix of employees covered by the Agreement and should be covered by a different agreement;
"9. My view is that Oral Health Practitioners should not be part of the Merri Health Enterprise Agreement 2024 - 2027. We share little in common with most of the employees covered by this enterprise agreement who don't provide dental services and are not health professionals.
10. Even in the case of Dental Assistants, who Oral Health Practitioners work alongside regularly, as I indicated above, they are not required to be registered with the Dental Board of Australia. Oral Health Practitioners, like Dentists and Dental Prosthetists, are Dental Practitioners who are required to be registered with the Dental Board of Australia.
11. This is not meant to diminish the work of my Dental Assistant colleagues. The work they do is important and they work hard. However, the responsibilities and obligations on Oral Health Practitioners, as a result of being health professionals and being registered with the Dental Board of Australia, are much greater than those of Dental Assistants.
12. I believe that Oral Health Practitioners at Merri Health should either have their own enterprise agreement at Merri Health or be part of an enterprise agreement that covers other health professionals, such as the enterprise agreement that covers Dentists or Dental Prosthetists."[19]
[37] Holstep Health concede that the Agreement now before the Commission does not cover all of its employees and that the group of employees covered by the Agreement is not geographically, operationally or organisationally distinct. It says the lack of these kinds of distinction is not decisive in the Commission's determination of whether the Agreement may be approved.[20]
[38] After reviewing relevant principles from the Full Bench in Cimeco v CFMEU & Ors,[21] Hostep submits that the question of whether the group is "fairly chosen" involves a degree of subjectivity or value judgement; and that, where the group has been selected on some objective basis as opposed to an arbitrary or subjective basis, this is likely to point to a conclusion that the group employees was fairly chosen. The Commission's role is not to determine the scope of the Agreement but instead to guard against unfairness.
[39] The Applicant's considerations about choosing the group to be covered by the Agreement include these;
• The NERR was issued by Ms Hornby on 3 June 2024 "to the employees to be covered by the Proposed Merri Health Enterprise Agreement 2024-2027".[22] The notification included:
"Merri Community Health Services Limited gives notice that it is bargaining in relation to a single-enterprise agreement Merri Health Enterprise Agreement 2024-2027 which is proposed to cover employees that are currently covered by the Merri Health Enterprise Agreement 2021".[23]
• Ms Hornby's evidence is that the notification was sent by email to the employees to be covered, including the Oral Health Practitioners. She says as well that the Oral Health Practitioners are covered by an existing agreement, the Merri Health Enterprise Agreement 2021.[24]
• On 7 June 2024, VAHPA "requested that the Applicant confirm coverage of the proposed agreement. The Applicant confirmed, also on 7 June 2024, that the Employer was going to continue with the existing coverage of their stand-alone agreement, covering a broad range of employees (including Dental Therapy Employees).[25]
• The VAHPA was involved in bargaining meetings "on and off from as early as 11 June 2024, and served a log of claims on 12 September 2024 that specifically contemplated the scope and did not contain any objections to it".[26] In a footnote to this submission, the Applicant argues that VAHPA "was the only bargaining representative to attend the first bargaining meeting on 11 June 2024. On 11 August 2024, the Respondent withdrew from bargaining as it did not have any members at Merri Health. It was then on 2 September 2024 that the Respondent advised it now had members and that it would attend bargaining".[27]
• There then developed "a shared assumption as to the scope of the proposed agreement, if not an express agreement as to that scope".[28]
[40] Why this particular grouping was chosen is addressed by the Applicant in its submissions;
"12 Merri Health chose this grouping of employees because:
(a) this group of employees, including the Oral Health Practitioners (OHPs), was covered by the Merri Health Enterprise Agreement 2021 (2021 Agreement) which reached its nominal expiry date on 1 August 2024;
(b) almost all other Merri Health staff were covered by other enterprise agreements;
(c) this Agreement would bring the Dental Assistant Trainees (currently covered by the Miscellaneous Award 2020) into the grouping, meaning that is one less industrial instrument for Merri Health;
(d) Merri Health's industrial goal is to consolidate its enterprise agreements towards a single enterprise-level agreement, with the exception of the Nursing and Midwives professions due to supplementary funding received to pay for the bargaining outcome;
(e) there was no apparent benefit to excluding a category of employees who were covered by the 2021 Agreement from coverage under its replacement agreement;
(f) there was an obvious detriment to doing so, being the inefficiency of having to continue to apply the existing 2021 Agreement in respect of some employees, while operating under a new agreement in respect of other employees.
13 Merri Health's overall goal of consolidation of the majority of its enterprise agreements is consistent with the objectives of the Act, which places an emphasis on enterprise-level collective bargaining. It is implicit in these objectives that the desired outcome of the Act is the making of enterprise agreements which cover broad groups of employees, even though they might be performing different functions and in different occupational groups."[29]
[41] The Applicant submits that these reasons "were clearly an objective basis for choosing that group, derived from the industrial history and context of the organisation or team and that cohort of employees".[30]
[42] The Applicant also submits that, in bargaining for an agreement to replace an existing agreement, it is inherently fair and reasonable for an employer to choose not to exclude a group of employees who were covered by the existing agreement.[31]
[43] In relation to the Commission's approval of the earlier, and currently operating 2021 Agreement, the Applicant submits;
"25 The Commission has already determined that this group of employees (minus the Dental Assistant Trainees) has been fairly chosen. It was also determined that a group of employees including OHPs and staff who are not health professionals in the Agreement were fairly chosen.
26 The Respondent appears to argue that the Commission might have erred in approving the 2021 Agreement (and by extension the 2018 Agreement), although this argument is not developed. The Respondent does not expressly state the nature of the presumed error, but raises a question about what consideration was given to the issue of how the group of employees was chosen.
27 In both cases, the Commissioner approving the agreement expressly stated that they were satisfied that the requirements of section 186 had been met. There is no basis to suggest that the Commission failed to consider section 186 in either decision. Neither decision was appealed, and neither should be impugned based on pure supposition."[32]
[44] The Applicant also notes that: "Had the OHPs not been covered by the proposed agreement, they would have remained covered by the 2021 Agreement", and notes that the OHPs are "objectively better off under the proposed agreement than the 2021 Agreement".[33]
[45] The principles for assessment of whether a group covered by an enterprise agreement has been fairly chosen are well established.
[46] Section 186 requires the Commission to approve an agreement if the requirements set out in ss.186 - 187 are met. Relevantly for the purposes of this matter, there is an obligation for the Commission to be satisfied that the group of employees covered by the agreement was fairly chosen (ss.186(3)). There is no dispute that the Agreement does not cover all of Holstep Health's employees. This fact requires the Commission to "take into account whether the group is geographically, operationally or organisationally distinct", as a step toward determination of whether the group covered by the Agreement was fairly chosen (s.186(3A). The context of this assessment is not about those not covered by the proposed agreement, but whether those who are covered are geographically, operationally or organisationally distinct.
[47] The Full Bench in Cimeco v CFMEU & Ors[34] held
"[21] It is not appropriate to seek to exhaustively identify what might be the other relevant considerations. They will vary from case to case and will need to be demonstrated to the satisfaction of the tribunal. The word 'fairly' suggests that the selection of the group was not arbitrary or discriminatory. For example, selection based upon employee characteristics such as date of employment, age or gender would be unlikely to be fair. Similarly, selection based on criteria which would have the effect of undermining collective bargaining or other legislative objectives would also be unlikely to be fair. It is also appropriate to have regard to the interests of the employer, such as enhancing productivity, and the interests of employees in determining whether the group of employees was fairly chosen. In this regard, it is not only the interests of the employees covered by the agreement that are relevant; the interests of those employees who are excluded from the coverage of the agreement are also relevant. We note that there is a suggestion to the contrary in the oral submissions put on behalf of Cimeco when counsel submitted that:
"It was an erroneous approach to introduce the identification of the persons who were relevantly employed at the time of the making of the agreement for the purposes of testing the group chosen."
[22] To the extent that it is suggested that the interests of the excluded employees are irrelevant we reject that submission. In evaluating whether the group to be covered by the agreement has been fairly chosen it is entirely appropriate to have regard to the consequences of that choice, that is, which employees have been excluded from the agreement."[35]
[48] The Applicant agrees with the Respondent that the applicable principles from Cimeco and other cases may be summarised as follows;
"(a) the question of whether or not the group of employees covered by an enterprise agreement is "fairly chosen" involves a degree of subjectivity or value judgement;8 [Cimeco, [8]]
(b) there may be more than one way of fairly choosing the group of employees to be covered by a proposed enterprise agreement;9 [ResCo, [35]; BP, [14]]
(c) if the group of employees to be covered by an enterprise agreement has been selected on some objective basis, as opposed to an arbitrary or subjective basis, this is likely to point to a conclusion that the group of employees was fairly chosen;10 [Cimeco, [16]]
(d) the role of the Commission is not to determine the scope of the agreement, but to guard against unfairness by being satisfied that the group can be described, in all the circumstances, as fairly chosen;11 [ResCo, [35]]
(e) the question of whether or not group of employees covered by the agreement is geographically, operationally or organisationally distinct is not decisive, rather it is a matter to be given due weight, having regard to all other relevant considerations.12 [Cimeco, [20]]." [36] (intext citations have been added above, after the relevant footnote)
[49] The Applicant also submits, correctly in my view, that the Commission must also have regard to these additional matters;
"(a) the group of employees is chosen at the time that the employer and the bargaining representatives agree on a particular scope, or the bargaining representatives commence bargaining on a shared assumption as to scope;13 [Re Stadium Australia Operations Pty Ltd T/A ANZ Stadium [2010] FWAA 3758 (Stadium Australia), [28].]
(b) the question of whether the group must have been fairly chosen must be assessed at the time that the group of employees was chosen;14 [Stadium Australia, [28]]
(c) the fact that some employees proposed to be covered by the Agreement might have priorities which differ from other employees in the group does not necessarily mean that the group of employees was not fairly chosen;15 [Re ALDI Foods Pty Ltd [2013] FWC 3495 (Aldi), [33]; BP, [16]-[17]]
(d) the fact that one subgroup of the employees covered by a proposed agreement is much smaller than other subgroups does not necessarily mean that the overall group was chosen unfairly; and16 [Stadium Australia, [30]]
(e) in considering the criteria by which the group of employees was chosen, the Commission must have regard to whether the criteria reflect the criteria identified in section 186(3A) or some other like legitimate business-related characteristic, rather than an extraneous characteristic (such as place of birth, or political persuasion).17 [John Holland Pty Ltd v CFMEU [2014] FCA 286, [33]]"[37] (intext citations have been added above, after the relevant footnote)
[50] I also accept the Applicant's submission that, following these principles, it is clear that the relevant consideration is whether the group was fairly chosen, not whether it is more fair than an alternative grouping or that the Commission should identify and give effect to the most fair grouping.[38]
[51] The circumstances now before the Commission do not reveal an unfairness in the formation of the Agreement. In forming this view I take into account;
The Oral Health Practitioners are presently covered by a "general" enterprise agreement covering other occupations and professions.
The NERR issued for the Merri Health Enterprise Agreement 2024 - 2027, disclosed to employees that bargaining would be for an agreement "proposed to cover employees that are currently covered by the Merri Health Enterprise Agreement 2021".
Bargaining for the proposed agreement commenced in June 2024, with VAHPA initially participating but temporarily withdrawing between August and September 2024, when it served a log of claims for bargaining on the Applicant.
There is no evidence before me to suggest Oral Health Practitioners objected to their coverage by the proposed agreement at any time before the Agreement was made.
There is also no evidence that Oral Health Practitioners stated in bargaining that their interests in bargaining were disadvantaged because of their lack of numbers and the dominance of other bargaining representatives.
[52] It is also the case that the group covered by the Agreement is not geographically, operationally or organisationally distinct. While this is so, the finding does not advance the matters to be determined, and especially not to a finding that the group covered by the Agreement is not fairly chosen.
[53] The "choice" exercised by Holstep's predecessor, Merri Health, was to propose a scope which covered "employees that are currently covered by the Merri Health Enterprise Agreement 2021". Holstep was entitled to progress from that point on the basis that 2021 Agreement had been approved by the Commission for reasons that included an acceptance of the group covered by that agreement as having been fairly chosen. No one objected. No one argued their bargaining power was swamped by others. No one contended they would be better off covered by some alternative enterprise agreement.
[54] While accepting the responsibility of the Commission as presently constituted is to determine for itself whether this agreement and not any other agreement is fairly chosen the fact of the current agreement's coverage is an objective fact known to all concerned at the time the NERR was distributed. Proposing coverage of a future agreement on the same basis of the coverage of an existing agreement cannot, in the absence of compelling evidence to the contrary, be viewed as arbitrary or subjective. It reflects currently operating arrangements which would continue indefinitely if the proposed bargain is never made.
[55] This is not a circumstance in which a comparatively small group of employees is for the first time shoe-horned into an agreement with a much larger group of other employees as a means of weakening or overwhelming the smaller group's industrial interests. In putting the NERR forward there is no new element of subjectivity.
[56] Further, it would be remarkably unfair situation to exclude from bargaining for a replacement agreement the Oral Health Practitioners without parallel bargaining for some other agreement to cover their interests.
[57] In this regard the Oral Health Practitioners put forward they should be covered either by their own enterprise agreement or by an agreement that covers other health professionals, such as the agreement that covers Dentists or Dental Prosthetists.[39] The Respondent argues Merri Health does not employ dental prosthetists and that dentists are covered by the Merri Health Audiologists, Dietitians, Pharmacists and Dentist Enterprise Agreement 2023, the nominal expiry date of which is 1 August 2027. Holstep submitted that it chose the grouping for the Agreement now under consideration for several reasons including that it is a step toward eventual consolidation of agreements into a single enterprise agreement.
[58] These matters lean towards a finding of objectivity about inclusion of the Oral Health Practitioners in this Agreement: they are already covered by the current agreement with a similar or identical scope and absent agreement for a separate enterprise agreement for their own classifications the alternative of moving them to another multi-classification or multi-employer agreement would have its own questions of fairness of choice of coverage.
[59] The unfairness pointed to by the Oral Health Practitioners is essentially that their interests could be better looked after if they were covered by another agreement. In Stadium Australia, Vice President Lawler considered the importance of the relative weight of bargaining representatives or groupings;
"[28] On the plain words of the provision, the requirement in s.186(3) is concerned with the fairness of the choice of group of employees to be covered by an agreement rather than the fairness of the content of the agreement. It seems to me that since the concern is with the fairness of the choosing, a consideration of the requirement in s.186(3) should be directed at the time the group was chosen. If the group was fairly chosen at that time then the requirement is satisfied. I proceed on the basis that the group of employees to be covered by a proposed agreement is "chosen" when the employer and the main employee bargaining representatives agree on a particular scope or the bargaining representatives commence bargaining on a shared assumption as to scope (as is often the case when bargaining proceeds by reference to the terms of an existing agreement that is to be replace by the a proposed new agreement).
[29] The time of the choosing is a factual issue to be determined in the usual way. The group of employees to be covered by a proposed agreement - the scope of the agreement - will typically be chosen at or shortly after the commencement of bargaining. Of course, there may be disagreement between the bargaining representatives over the scope of a proposed agreement in which case the scope may itself be the subject of bargaining.
[30] The mere fact that one subgroup of the group of employees covered by an agreement is smaller in number, even much smaller, than another subgroup cannot, of itself, lead to a conclusion that the overall group was chosen unfairly: it would be possible identify such subgroups in relation to almost every enterprise agreement."[40]
[60] While I understand and respect the grievance felt by the Oral Health Practitioners, those concerns should have been articulated well before the time the Agreement was made and likely in the early stages of bargaining. From around September 2024 there was a shared assumption as to the scope of the proposed agreement, with there being no evidence before me that an objection to the scope was put forward before the Agreement was made. To the extent the Oral Health Practitioners' grievance goes to the content of the Agreement as it affects them, even if it had been raised at an earlier time, it may well just be one of the outcomes of the bargaining process: not everything bargained for will be agreed by everyone, and ultimately whether there is agreement is something to be determined by the democratic process of a ballot.
[61] It follows I am satisfied that the group of employees covered by the agreement was fairly chosen.
[62] Having regard to the material contained in the application and filed in relation to it, I am satisfied that each of the requirements of ss.186, 187, 188, 193 and 193A as are relevant to this application for approval have been met.
[63] The Australian Municipal, Administrative, Clerical & Services Union Vic/Tas Authorities & Services Branch, being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers the organisation.
[64] The Health Services Union Victoria No 1 Branch, trading as the Health Workers Union (HWU), being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers the organisation.
[65] The Health Services Union, specifically the Health Services Union Victoria No. 3 Branch, trading as the Victorian Allied Health Professionals Association (VAHPA), being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers the organisation.
[66] Through correspondence to the Commission on 6 March 2025 and 16 April 2025, the Applicant advised that it seeks the Agreement if approved be entitled the "Holstep Health Enterprise Agreement 2024 - 2027" and for Clause 15.7(ii)(b) to be amended, adding 'or predecessor'. I take this to be an application to the Commission pursuant to s.218A(1) of the Act, which provides that the Commission may vary an enterprise agreement to correct or amend an obvious error, defect or irregularity (whether in substance or form). At the Commission's request, a varied version of the Agreement has been provided and is agreed by the bargaining representatives.
[67] The Agreement as varied is approved and will operate from seven days after approval in accordance with s.54 of the FW Act. The nominal expiry date of the Agreement is 1 August 2027.
[1] Form F17B, item 29; Digital Hearing Book (DHB), p.30
[2] Applicant's Submissions on legal representation, [5].
[5] VHIA email to the FWC, 7 February 2025; DHB, p.495.
[8] Exhibit VHIA - 1, Witness Statement of Casey Hornby, [11]; DHB p.519.
[9] Exhibit HSU3 - 4, Outline of Submissions, [16]; DHB, p.539.
[17] Exhibit HSU3 - 4, [46] - [48]; DHB, p.546.
[19] Exhibit HSU3 - 1, First Witness Statement of Sabrina Ernst; DHB, p.737 - 738.
[20] Exhibit VHIA - 4, Outline of Submissions, [2]; DHB, p.506
[22] Witness Statement of Casey Hornby, [14]; DHB p.520.
[23] Notice of Employee Representational Rights; DHB, p.254.
[24] Exhibit VHIA - 1, Witness Statement of Casey Hornby, [14]; DHB, p.520.
[25] Exhibit VHIA - 1, [10](b); DHB, p.508.
[36] Exhibit VHIA - 1, [7]; DHB. p.507.
[39] Exhibit HSU3 - 1, First Witness Statement of Sabrina Ernst; DHB, p.738.
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