Agreement cases: safety net, consent arbitration, call-back, more


Agreement cases: safety net, consent arbitration, call-back, more

The Fair Work Commission is often called on to resolve contentious points in the making and variation of agreements — these recent cases include issues of call-back pay rates, 12-hour shift provisions, safety net for 457-visa holders and more.


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The Fair Work Commission is often called on to resolve contentious points in the making and variation of agreements — as exemplified in these recent cases. 
Safety net for 457-visa holders — meat industry

Commissioner Simpson found that wages and conditions should be increased to the minimum standard under the Meat Industry Award 2010. The current agreement failed to meet other award-based entitlements including overtime, shiftwork and certain allowances. Commissioner Simpson said it was of concern that one of the factors in favour of the employer party winning a contract at Woolworths Ltd’s Brisbmeats was that it was competing at a labour rate below the Modern Award safety net. In relation to the workforce, the Commissioner noted:
‘Given the workforce is overwhelmingly casual with a reasonably high level of turnover, are working on various classes of humanitarian or other immigration visa, and predominantly speak limited or no English the practical challenges for the employees or their representatives in attempting to bring [AWX] to the bargaining table other than by agreement are such that I do not intend to find their failure to attempt to do so as a matter that should weigh against the granting of this application in these particular circumstances.’
Employees of AWX Pty Ltd re AWX Pty Ltd Employee Collective Agreement [2013] FWCA 4490 (9 August 2013)

Consent wage arbitrations — guidelines

Commissioner Cargill said that six relevant factors should guide consent wage arbitrations. The Commissioner awarded 65 manufacturing workers in the automotive industry a 3.5 per cent wage increase as the first instalment in a proposed three-year deal. The factors noted were:
  1. the financial situation of the business, which was operating at a significant loss and was expected to continue to do so over the next few years
  2. the economic environment in the manufacturing sector generally and the automotive sector in particular, and the allied issue of the falling Australian dollar
  3. the desirability of maintaining the real value of the workers’ wages, noting the ‘all groups CPI’ rise of 2.4 per cent in the year to June 2013
  4. the size of wage increases ‘elsewhere’, with the evidence indicating a 3.7 per cent average annualised wage increase (AAWI) for all private sector agreements for the March 2013 quarter, 3.5 per cent for manufacturing industry agreements and 3.9 per cent in metals-manufacturing
  5. previous wage increases at the site — ranging from an average 3.9 to 4.09 per cent per annum since 2000 depending on whose evidence was accepted
  6. the wages package as a whole, which included the $400 payment, a backdated first increase and 4 per cent rises in years two and three.
Chassis Brakes International Castings Pty Ltd v AWU and AMWU [2013] FWC 5615 (15 August 2013)  

FWC not required to reject agreement containing non-permitted content

The Commission considered that the supplementary labour hire provisions in the agreements required further scrutiny. Whether the provisions restricted the employer’s right to use individual contractors or contracted labour was an issue. The Commission sought the employers’ opinions, but no response was received. The union submitted that there was no requirement for the Commission to identify non-permitted content and the agreements should be approved. The Commission held that the provisions did not comply with s172(1) of the Fair Work Act 2009; however, there was no requirement for it to reject an agreement containing non-permitted content. The agreement can only operate to the extent that it is lawful. The agreements were approved.

Trustee for Taf Group Construction (One) t/a Taf Group Construction and CFMEU Union Collective Agreement 2011 — 2015 and others [2013] FWC 5033 (7 August 2013)

Call-back pay rate considered — nurses

The dispute was about cl 22 in the Presbyterian Care Tasmania Incorporated Nurses Agreement 2011. The dispute centred on what employees who are called back in to work should be paid. The Australian Nursing & Midwifery Federation (ANF) submitted that employees who are called back to work are entitled to a minimum payment of four hours or three hours, as the case may be, at overtime rates. The employer submitted that while employees who are called back to work are paid at overtime rates, the minimum payment must be equal to either four hours pay at ordinary time or three hours pay at ordinary time. The ANF and the Health Services Union (HSU) relied on four indications to support their contention:
  1. the words of the clause itself
  2. the statement of the employer when negotiating the predecessor agreement that there was no intention to reduce conditions
  3. the statutory declaration of the employer representative filed with the Commission with the application to approve the agreement which stated that the clause was more beneficial than the corresponding provision in the Nurses Award 2010
  4. the construction of the clause put by the employer would mean an employee on close call who was not required to perform work would get paid more than an employee on close call who was required to perform work.
While the Commission would not have found any of the individual reasons relied upon by the unions by themselves to be decisive, when considered together, they supported the conclusion that the clause was intended to provide nurses, who were called back to work, a minimum payment of four or three hours at overtime rates.

The Commission did not accept that the parties intended that an employee on close call who was not required to work would be paid more than an employee on close call who was required to work. The only possible interpretation is that cl22(a) required the employee to be paid a minimum of four hours or three hours at overtime rates.

Australian Nursing Federation v Presbyterian Care Tasmania [2013] FWC 5317 (6 August 2013)

12-hour shift provisions and BOOT

An employee opposed approval of the agreement. It was alleged that the voting process lacked integrity, the employees were not provided with sufficient information and the agreement did not pass the BOOT. The Commission was satisfied that all reasonable steps had been taken to ensure employees had access to the relevant material. Senior employees attended workplaces to provide information about the proposed agreement and its differences to the modern award and copies of the agreement were made available at each worksite. While a particular employee may not have seen a copy that did not mean it was not provided. The employer provided evidence of messages sent to employees regarding the proposed agreement. The majority of employees who voted had over three weeks to access relevant documents and obtain information.

The Commission found that agreement was ‘genuinely agreed’ to in accordance with s188 of the Fair Work Act 2009. In most respects the modern award applied under the proposed agreement. The main difference related to 12-hour shifts. In light of the 2012 Review of the Fair Work Act, the Commission was unable to find the proposed agreement would pass the BOOT in its current terms, but the Commission was prepared to give consideration to undertakings the employer might be prepared to give in respect of the agreement. The employer was directed to advise the Commission in writing by 13 August 2013 of the terms of any undertakings it might wish to make.

Re MSS Security (Australian Capital Territory) Security Officers’ Agreement 2013–2017 [2013] FWC 5424 (6 August 2013)

Notice to new employee does not have status of notice of representational rights

This case concerned the Walter Wright Cranes (Mackay Branch) Collective Agreement 2013. The application was for approval of a single-enterprise agreement. The employer declared that the last notice of representational rights was given on 19 May 2013. It declared the date voting commenced was 3 June 2013. The period of time that elapsed between the notice and the vote was 15 days. The Act stipulates that the request to approve an agreement cannot be made until 21 days after the day the last employee representational rights notice was given.

The issue was whether the last notice of representational rights said to have been issued by the employer was in fact such a notice. The employer indicated that the notice on 19 May was to a new employee. Notice was given to other employees on 22 March. The Act specifies that the notice must be given to employees employed at ‘notification time’. The new employee in this case was employed after the notification time. The notice to the new employee did not have the status of a notice of representational rights for purposes of the Act despite purporting to. The agreement therefore was made in compliance with s181(2) of the Fair Work Act 2009 and subject to the ordinary approval process.

Walter Wright Cranes (Mackay Branch) Collective Agreement [2013] FWC 4168 (27 June 2013)

Modern award coverage could confuse: agreement not terminated
Senior Deputy President O’Callaghan said relying on the Building and Construction Award to determine rates of pay and conditions for all employees might lead to disputation or reduced and variable remuneration arrangements:
‘This potential was a public interest consideration which particularly applied to employees of Altus who have not been heard in this matter and mitigates against the termination of the Agreement. It ran counter to the objectives of the enterprise bargaining provisions of the FW Act set out in s171’.
The Commission stated that it had considered balloting the employees but was concerned this would complicate the agreement renegotiation process. The Commission concluded:
‘In this context, I do not consider that termination of the Agreement will positively contribute to the negotiation process. Equally, the retention of the Agreement does not inhibit the CFMEU or employee bargaining representatives from seeking particular claims, some or all of which may be derived from the building and construction industry.’
Because there were significant differences in wages and conditions in the awards, terminating the agreement might lead to variations in employees’ pay, the potential for increased confusion and a substantial chance of pay errors.

Badman v Altus Traffic Pty Ltd [2013] FWC 4409 (5 July 2013) 
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