Federal Court finds enterprise agreement scope clauses can have broad application

The Federal Court decision in John Holland Pty Ltd v Construction, Forestry, Mining and Energy Union and Fair Work Commission [2014] FCA 286 (27 March 2104) confirms that an employer can enter into an enterprise agreement with a limited number of employees, but with the capacity to apply over time to a wider range of employees.

BACKGROUND

John Holland Pty Ltd (John Holland) was awarded the contract to build the $1.2 billion Perth Children's Hospital. John Holland employed three employees to perform building and construction work, and only expected to employ a total of 25 direct employees at the hospital site (the bulk of the work to be carried out by subcontractors).

On 12 January 2012, John Holland held a meeting with the three employees. In this meeting, the employees each appointed themselves as bargaining representatives for purposes of negotiating an enterprise agreement (Agreement) with John Holland under the Fair Work Act 2009 (Cth) (FW Act). On 13