Employment Law Update

When can a casual employee vote to approve an enterprise agreement?

McDermott Australia Pty Ltd v AWU, AMWU [2016] FWCFB 222

A Full Bench of the Fair Work Commission (the Commission) has ruled that casual employees who had been engaged, put through paid training and recorded on their employer’s payroll system, are entitled to vote on a proposed enterprise agreement, even though they were not working at the time the employer requested the employees approve the enterprise agreement.

The Full Bench overturned the initial ruling under which the proposed enterprise agreement was not approved by the Commission on the basis that the 36 casuals employees who voted on it were not “…employed at the time” as required in the relevant provisions in the Fair Work Act 2009 (Cth) (the Act).

The phrase “…employed at the time” is included in subsection 181(1) of the Act which relates to when an employer may request employees to approve a proposed enterprise agreement.  The subsection provides as follows:

“An employer that will be covered by a proposed enterprise agreement may request the employees employed at the time who will be covered by the agreement to approve the agreement by voting for it.”

The issue arose primarily from the fact that, at the time the employees approved the proposed enterprise agreement, the employer (McDermott Australia) was not conducting any work, which in turn meant that none of the casual employees were working offshore.  19 of the 36 casual employees voted to approve the proposed enterprise agreement.

The proposed enterprise agreement related to construction work off the Western Australian coast on the Inpex Ichthys Project.  The Full Bench stated in its judgement that it is the industry practice that all offshore construction employees engaged on projects off the North West coast of Western Australian are employed on a casual basis, and that this was not necessarily the case elsewhere in Australia.

McDermott Australia led evidence that established the following:

  • most of the casual employees had worked on previous campaigns (i.e. work projects);
  • all of the casual employees had been paid while undertaking essential training for the project; and
  • all of the casual employees were on the company’s payroll for the project before the vote;

The Full Bench stated that “In our view it would be inappropriate and counter intuitive to disenfranchise casual employees of a right to vote on an agreement that determines their wages and conditions on the basis that they were not rostered on to work on the day/s of the vote, or during the seven-day access period.  There are obvious implications for voting manipulation adopting this approach.”

The Full Bench also stated that McDermott’s evidence established that the casuals accepted on-going employment with McDermott and “…as such they were employed by McDermott at the time the agreement was made”.

This case provides important guidance to employers as to whether, or not, to include casual employees in a vote to approve an enterprise agreement made under the Act.

It is obvious that casual employees who work during the seven day access period (i.e. the seven day period ending immediately before the start of the voting process to approve a proposed enterprise agreement) have the right to vote to approve enterprise agreements.  However, this decision establishes that casual employees who have not worked during the access period but who have an ongoing connection with the employer, which could include casual employees who have received specific training to enable them to work for an employer, should also be considered in relation to their right to participate in the vote.

For further information, please contact:

Seamus Burke | Partner
P: +61 2 4040 1000
seamus@lbclawyers.com.au