CFMEU sticks the BOOT into building agreement

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CFMEU sticks the BOOT into building agreement

A union has successfully overturned the approval of an agreement that short-changed employees in the commercial building industry.

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A union has successfully appealed a Fair Work Commission decision which approved an enterprise agreement that disadvantaged employees in the commercial building industry.

Facts and background

 
The commission approved the Career Boss Commercial Enterprise Agreement 2017, which was made by Career Boss Commercial Pty Ltd, as per section 185 of the Fair Work Act 2009. It was a single enterprise agreement. 
 
The Construction, Forestry, Maritime, Mining and Energy Union (CFMEU) appealed the FWC’s decision because it said the agreement didn't pass the better off overall test (BOOT). The test considered whether Career Boss Commercial’s construction employees were financially better off under the agreement or under the Building and Construction General On-site Award 2010 (award) that covered them. 

The law

 
Under section 604 of the Fair Work Act, there is an opportunity to appeal FWC decisions.
 
The BOOT is in section 193 of the Act. It requires that each ‘award covered’ employee and each prospective award-covered employee must be better off under an agreement than they would if the relevant modern award applied to them.

Arguments

 
The CFMEU submitted a table comparing the rates of pay under the agreement and the award.

It showed that all four categories of prospective employees would be worse off under the agreement:
  • A CW3 prospective rigger would be $76.72 worse off per week
  • A CW3 prospective night shift rigger would be $282.94 worse off per week
  • A CW1 prospective employee woud be $74.38 worse off per week, and
  • A CW1 prospective night-shift employee would be $270.57 worse off per week.
 
Career Boss Commercial provided its own table, and showed that the prospective employees would earn more if the agreement applied: 
  • $40.31 for a CW3 rigger
  • $25.42 for a night-shift rigger
  • $63.17 for a CW1 rigger; and 
  • $38.72 for a CW1 night-shift rigger.

The question

 
The court was asked to consider four points in comparing the agreement and the award: 
  • The rate of pay, namely whether award pay rates for daily hire employees should be used for comparison purposes, as the CFMEU contended, or pay rates for weekly hire employees should be used, as Career Boss Commercial contended.
  • The meal allowance in the agreement, namely whether or not the payment of the allowance should be included in the calculations.
  • How night shift workers’ pay rates should be calculated under the agreement.
  • The agreement’s failure to provide for a crib break at the commencement of overtime like the award does.

Considerations and decision

 
A FWC full bench reached the following decision:
  • The weekly hire employee pay rate is the appropriate rate that should be used when comparing the award to the agreement.
  • Any comparison of what employees would be paid under the award and the agreement should be based on the assumption that employees would receive the meal allowance under the award, but not the agreement.
  • Career Boss Commercial’s calculations exaggerated how much a night shift employee would be paid under the agreement.
  • It accepted CFMEU’s submission that Career Boss Commercial had miscalculated the amount of crib break time that would be payable. 
It found that employees and prospective employees engaged under the agreement suffered three detriments relating to payment of the meal allowance, the night shift pay rate and the overtime crib break (when compared to the award). Therefore, the agreement would not have passed the better off overall test and should not have been approved by the FWC. In these circumstances, the full bench upheld the CFMEU’s appeal and quashed the initial decision. 
 
The bottom line: A person or company can appeal a decision made by the FWC. The CFMEU was successful in its appeal against Career Boss Commercial because the FWC failed to consider the better off overall test. 

Read the judgment

 
 
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