‘Fake’ deal sparks Fair Work probe into seven agreements

Fair Work president Adam Hatcher has ordered an inquiry into the approval of seven enterprise agreements.

Adam Hatcher has been appointed the new president of the Fair Work Commission.

Fair Work Commission president Adam Hatcher has ordered an inquiry into the approval of seven enterprise agreements after a landmark decision found a Western Australian company engaged in an “ingenuine and fake” process to get an agreement approved.

Australian Workers Union national secretary Paul Farrow urged the federal government to make further industrial relations law changes after the exposure of the sham agreement that was later used to win work on a Chevron oil and gas facility.

Slamming the conduct of those involved in the now quashed Workforce Logistics enterprise agreement, Justice Hatcher said it appeared a number of people involved in the “sham exercise” might have been involved in the making of other agreements ­approved by the commission in recent years. He said the full bench would refer seven agreements to the commission general manager for further inquiry to ascertain whether there had been any “wider-scale abuse of the enterprise agreement-making facility in the Fair Work Act”.

In its decision, the full bench found Mr Blake Read, the director and sole shareholder of Workforce Logistics, applied for approval of a four-year agreement that was to cover six workers.

One employee was Mr Read’s brother, two employees were his existing business partners and two were relatives of one of the business partners. They were to be employed for only four to six weeks and the purpose was to establish a corporate shell with an enterprise agreement to sell off.

Two months after the agreement was approved by the commission, Workforce Logistics was sold to AusGroup Companies and then to Altrad Australia.

The agreement, which set terms and conditions of employment that are far below industry standards, was used to apply to maintenance employees working on Chevron oil and gas facilities.

The full bench said the contracts with the workers were a “sham” and the approval of the agreement by the six employees was entirely lacking in authenticity and moral authority. Further inquiry was warranted as it appears that a number of the persons involved in the sham exercise … have also been involved in the making of a number of other enterprise agreements in Western Australia which have been approved by the commission in recent years.

Mr Farrow has written to Workplace Relations Minister Tony Burke urging him to introduce new laws to deal with the issue, including by automatically terminating all low-voter cohort enterprise agreements. Mr Burke declined to comment.

Mr Farrow welcomed the upholding of the AWU appeal, but said “it’s an embarrassment to Australia that such blatantly cynical scams can get off the ground at all in our system”. “You can’t have cosy little cohorts running ahead, pretending to be relevant workers, and establishing low pay agreements at greenfield sites so they can be used on real workers when they arrive and decimate industry standard terms and conditions of employment that workers and their unions have fought hard for,” he said.

“If we want Australians to get real wage increases to keep pace with the cost of living, we can’t allow industrial con artists to misuse and abuse our industrial relations system to set rates of pay and conditions at the floor and use these sham agreements to win contracts with companies such as Chevron, undercutting the current terms and conditions that apply.”