FWC provides guidance on changes to single interest employer authorisations

A single interest employer authorisation is an order made by the Fair Work Commission (FWC) requiring two or more employers with clearly identifiable common interests to bargain together in certain circumstances for an enterprise agreement that would apply to a cohort of employees employed by the employers. Such an enterprise agreement is called a ‘single interest employer agreement.’

Historically, single interest employer authorisations have been used by franchisees of the same franchisor. It was also possible for employers to seek a Ministerial declaration that the employers had a ‘common interest’ and could bargain together for an agreement.

To give more workers access to single interest employer authorisations, the SJBP Act has amended this historical position. Instead, the bargaining representative of an employee who will be covered by an agreement may instead apply directly to the FWC on the basis that the employers in question are either franchisees of the same franchisor, or ‘common interest employers.’ The requirement to obtain a Ministerial declaration has been removed.

Decision

Section 249 of the FW Act now provides that the key features which must apply if the FWC is to make a single interest employer authorisation are that:

• an application for the single interest employer authorisation has been made;
• at least some of the employees that will be covered by the agreement are represented by a union;
• the employers and the employees’ bargaining representatives have had the opportunity to express to the FWC their views on the authorisation; and
• the employers are either franchisees of the same franchisor or related bodies corporate of the same franchisor, or are ‘common interest employers.’

Many issues were not in dispute in this decision as the employers consented to the application, but the decision does provide some guidance on the definition of common interest employers.

Employers are considered common interest employers for the purposes of section 249 of the FW Act if they have ‘clearly identifiable common interests’ and it is not contrary to the public interest to make the authorisation.

The FW Act stipulates that matters which indicate that employers have a ‘common interest’ include their geographical location, regulatory regime and the nature of the enterprises to which the agreement will relate, and the terms and conditions of employment in those enterprises.

There is a rebuttable presumption that employers are common interest employers if an employer that would be covered by the proposed single interest employer agreement employed 50 or more employees at the time an application was made. In this case, no employer rebutted that presumption, so the FWC was not required to consider whether the employers were common interest employers.

Nevertheless, the FWC considered whether it would have been satisfied that the employers were common interest employers.

The Full Bench of the FWC had already considered the definition of ‘common interests’ in relation to supported bargaining agreements, being another area of law amended in the FW Act pursuant to the SJBP Act. In that decision, the Full Bench noted that ‘common interests’ is an expression of wide import, and extends to ‘any joint, shared, related or like characteristics, qualities, undertakings or concerns.’ The common interests must be ‘clearly identifiable’, meaning ‘plainly discernible or recognisable’ but not necessarily ‘self-evident.’

In this decision, the FWC adopted those definitions and confirmed that it would have been satisfied that the employers were common interest employers because each employer:

• is principally engaged in the provision of primary and/or secondary education in a school setting;
• operates in Western Australia;
• operates schools registered under the School Education Act 1999 (WA);
• employs one or more employees to whom the Educational Services (Schools) General Staff Award 2020 applies;
• engages in Catholic religious instruction;
• receives funding from the State and Commonwealth governments to deliver education; and
• employs one or more persons who are principally employed to provide, or to assist in providing, educational instruction or who are employed in any other capacity, and who are not employed as teachers.

Given that each of the legislative requirements were met, the FWC was required to, and did, grant the single interest employer authorisation.

Take home messages

This decision was very straightforward as the respondent employers all consented to the application, and as such, the FWC was not required to consider many of the more complex provisions of section 249. It will be interesting to see how the FWC determines applications where the employers do not consent, where the public interest ground is contested, or where the common interest is less clear cut. We will provide further updates to clients as this area of law continues to develop.

We can also provide advice to employers either seeking to apply for a single interest employer authorisation or whose employees intend to apply for a single interest employer authorisation.

For more specific information or advice on any of the material contained in this article, please contact Sathish Dasan on +61 8 8210 1253 or sdasan@normans.com.au, Anastasia Gravas on +61 8 8217 1331 or agravas@normans.com.au or Annabelle Narayan on +61 8 8210 1292 or anarayan@normans.com.au.