The role a union has to play when non-greenfields enterprise
agreements (EAs) are being negotiated under the
Fair Work Act 2009 is only as a bargaining representative. A union
will not become a party in its own right until after an EA has been
approved by employees in a ballot.
Obtaining the agreement of unions as employee bargaining
representatives is desirable, and makes obtaining approval by
employees in a ballot more likely, but is not an absolute
requirement. If the price of union support for a proposed EA is too
high, an employer can instead take steps to have employees approve
the proposed EA. The impact of this is still being played out in a
number of decisions of the industrial tribunal, Fair Work
The latest decision, of a Full Bench of the tribunal, is
CFMEU –v– Tahmoor Coal  FWAFB
3510. After lengthy negotiations and rejection by the CFMEU of a
number of EAs proposed by Tahmoor, Tahmoor put its final proposal
directly to employees, with the intention of asking employees to
vote on the proposed EA. Tahmoor sent information to employees and
held information sessions at which it explained its proposed EA. It
did this with the knowledge but not the agreement of the CFMEU,
which was a bargaining representative for the employees.
The CFMEU sought orders from the tribunal based on good faith
bargaining obligations in the Fair Work Act. It said that in going
directly to employees, Tahmoor was in breach of the obligation owed
between bargaining representatives to "refrain from
capricious or unfair conduct that undermines freedom of association
or collective bargaining". The Full Bench said: "we are
satisfied that in arranging to put its proposed agreement to the
employees in a ballot, Tahmoor was not acting capriciously or
unfairly in the circumstances prevailing at the time".
An important consideration was that the CFMEU was, in a
practical sense, aware of the approach to employees and what was
being said by Tahmoor in support of its proposed EA. The CFMEU
could not demonstrate that information given to employees by
Tahmoor was misleading.
The decision confirms that an employer can put a proposed EA
directly to employees without breaching the good faith bargaining
obligations. However the employer should take reasonable steps to
ensure that employee bargaining representatives have had a full
opportunity to consider and respond to the proposed EA, and are
kept informed about how direct communications with employees are
There is no union right of veto over what EA content an
employer can propose to employees, whether a ballot can be held at
all, or how the ballot must be conducted. The real question is what
conditions a majority of employees will approve in a ballot.
Putting a proposed EA to employees in a ballot without
agreement of employee bargaining representatives must be able to be
justified as action that may progress a stalled agreement-making
In negotiations with employee bargaining representatives, it
will be important to gauge what proposed EA will have real
prospects of being approved by a majority of employees, and to
explicitly aim proposals at that mark.
If it becomes necessary to put a proposed EA to employees
directly, to test the waters with a ballot, the approach needs to
be carefully planned to ensure it is in line with the good faith
bargaining obligations and other provisions of the Fair Work Act,
and any resulting agreement will meet the Fair Work Act tests for
approval by the tribunal
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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