Aboriginal Marine Manning Pty Ltd

[2015] FWCA 320

[2015] FWCA 320

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Aboriginal Marine Manning Pty Ltd
(AG2014/10708)

ABORIGINAL MARINE MANNING ENTERPRISE AGREEMENT 2014

Maritime industry
COMMISSIONER LEE	MELBOURNE, 14 JANUARY 2015

Application for approval of the Aboriginal Marine Manning Enterprise Agreement 2014.

[1] An application has been made for approval of a single enterprise agreement known as the Aboriginal Marine Manning Enterprise Agreement 2014 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by Aboriginal Marine Manning Pty Ltd.

[2] Three employee organisations, The Australian Maritime Officers’ Union (AMOU), The Maritime Union of Australia (MUA) and The Australian Institute of Marine and Power Engineers (AIMPE) lodged Form F18 - Statutory declaration of employee organisation in relation to an application for approval of an enterprise agreement forms (the Form F18 declarations). All three of the Form F18 declarations indicated that the relevant organisation supported the approval of the Agreement by the Fair Work Commission (the Commission); that the organisations agreed with the statutory declaration file by the employer and the organisations sought to be covered by the Agreement.

[3] This application was listed for approval e-hearing on 23 December 2014. Prior to the e-hearing in chambers, Mr Nathan Niven of AIMPE emailed my chambers and sought to withdraw the Form F18 declaration that was filed by the organisation and set out a number of concerns about the Agreement. The concerns mostly related to concerns as to whether the Agreement met the better off overall test. The email indicated that AIMPE sought to be heard on the application. Consequently the e-hearing in chambers was cancelled and I listed the matter for attendance hearing on 6 January 2014.

[4] At the hearing, Mr. Niven appeared representing AIMPE, Ms. Thompson appeared for the AMOU. The MUA did not appear. The Applicant was represented by Mr. Drake-Brockman of DLA Piper Australia. Permission to appear was granted to Mr Drake-Brockman. I considered it would enable the matter to be dealt with for efficiently as there was some complexity involved in the matter.

[5] During the hearing, Mr. Niven submitted another Form F18 declaration on behalf of AIMPE having withdrawn the first Form F18 declaration submitted. The new Form F18 declaration declared that the organisation did not support the approval of the Agreement by the Commission, set out the grounds of objection that replicated those in the email sent to my chambers on 23 December 2014 and indicated disagreement with the answers given in the employers statutory declaration. However, the new Form F18 declaration, consistent with the first Form F18 declaration provided notice that the organisation sought to be covered by the agreement.

[6] The Applicants’ representative raised an objection to AIMPE being heard as it was not evident that they had standing as a bargaining representative. Rather than hear argument and rule on this objection, I resolved to hear from Mr Niven utilising the broad powers of the Commission to inform itself in relation to any matter as it considers appropriate. I had regard for the fact that Mr. Niven advised he only wanted to be heard on the better off overall issues. The approach taken was consistent with the consideration of the Full Bench in CFMEU v Collinsville Coal Operations Pty Limited 1 .
[7] In summary, the grounds of objection raised by Mr. Niven on behalf of AIMPE in the second Form F18 declaration, are:

1. That aspects of Part A of the Agreement are ambiguous and that there was no reference to the Maritime Labour Convention Agreement

2. That the part time employment provisions conflicts with the Marine Towage Award 2010

3. That Schedule 2 of the agreement does not contain payment in relation to a number of allowances and other payments

4. That there were issues with award relativities and the remuneration clauses.

5. That the agreement failed the National Employment Standards in relation to casual loading

6. That AIMPE has concerns that the agreement may not pass the better off overall test for these reasons.

[8] In particular, the AIMPE submitted a handwritten calculation (marked in the proceedings as exhibit N1) that purported to show that engineers, who are paid $155,000.00 annually under the Agreement, would be worse off under the Agreement by at least $43,189.00, not taking into account the loss of allowances. This was said to be the case despite the fact that the rate of pay under the award is $54,631.20 as this annual rate is based on a 35 hour week, which when extrapolated to a seven day week and twelve hours per day, with associated penalties, would entitle the employee to $3,811.33 per week. As the Agreement allows for 196 duty days (28 weeks) per year, under the terms of the Marine Towage Award 2010, employees would be entitled to be paid 28 weeks at $3,811.33 per week, which equates to $106,717.24.

[9] However, the further submission of Mr. Niven for the AIMPE is that the remaining 24 weeks of the 52 weeks of the year would be paid, under the Marine Towage Award 2010 at the same rate of pay per week ($3,811.33 per week). If this assumption is correct, it provides an annual extra remuneration under the terms of the award of $91,471.92.

[10] It follows then from the submissions of Mr. Niven that the annual remuneration that could be earned working the roster configuration allowed for in the Agreement but applying the award ordinary rates, plus penalties, would be $198,189.16 per annum.

[11] In my view the submission is correct as to the application of the ordinary and penalty rates to work on the 7 day, 12 hour roster configuration. However, the notion that the Marine Towage Award 2010 allows for payment of the same rate of pay for 24 weeks of the year, essentially meaning that employees are paid for every single day of the year, including penalty rates, is based on an incorrect construction of the terms of the Marine Towage Award 2010.

[12] The modern award provides as follows:

“23. Annual leave

…

23.2 Entitlement to leave

(a) A permanent full-time employee will be entitled to 168 days free of duty in each year, or to proportionate leave for any continuous service of less than a year.

(b) A part-time employee’s entitlement to days free of duty will be determined in accordance with clause 10.2.

(c) The leave prescribed in clause 23.2(a) above includes:

(i) 104 days of leave, being instead of weekends;

(ii) five weeks of paid annual leave for shiftworkers under the NES. Employees under this award are considered to be shiftworkers for the purposes of the NES;

(iii) public holiday entitlements under the NES; and

(iv) an additional 28 days’ leave, to give effect to a 35 hour week.

[13] The 5 weeks annual leave is paid for ordinary hours at the award base rate of pay; exclusive of overtime, penalty rates etc (see the National Employment Standards at sections 90 and s.16 of the Act for definition of base rate of pay). That means that employees are entitled to be paid, under the Marine Towage Award 2010, for the 5 weeks of annual leave a total of $5,251.75.

[14] Therefore, if employees were to work the configuration of hours contemplated in the Agreement at award rates and receive a payment for 5 weeks annual leave, this equates to $111 967.31 (see table in Attachment 1 to this decision).

[15] As the amount paid under the Agreement to this classification is $155,000.00, employees are clearly better off, even accounting for the non payment of a number of allowances. I find the submissions of AIMPE to the contrary to be spurious.

[16] The better off overall test requires an overall assessment to be made. This requires the identification of terms which are more beneficial for an employee, terms which are less beneficial and an overall assessment of whether an employee would be better off under the agreement. 2

[17] In summary, the Agreement provides for rates of pay that are at between 20% and 220.3% of above the award rates of pay. The Agreement rates which are closest to award rates are those paid to employees who would be covered under the Seagoing Industry Award 2010 but for the Agreement. The Seagoing Industry Award 2010 provides for aggregated rates inclusive of overtime and penalties and the same 12 hour rosters as the Agreement. Other Agreement rates are at least 100% higher than award rates and easily compensate for the loss of overtime payments, penalties and other allowances under the relevant awards.

[18] I note that the concern about casual loading is not a National Employment Standards issue, but is an issue relevant to the better off overall test. Given the significant over award payments, the 20% loading provided for casuals does not mean employees are not better off overall.

[19] I have considered the other matters raised by Mr. Niven including concerns about ambiguity, a lack of reference to the Maritime Labour Convention Agreement, differences in the part time provisions and concerns about award relativities. I have also considered the response of the Applicant on these matters. I agree with the Applicant that, for the most part, these matters are not relevant to the matters to which I am to have regard in determining whether or not to approve the Agreement. To the extent that some of the matters, for example the part time provision, are relevant to the better off overall consideration, they do not give rise to a concern that employees are not better off overall.

[20] I am satisfied that each of the requirements of ss.186, 187 and 188 as are relevant to this application for approval have been met.

[21] The MUA, the AMOU and the AIMPE have given notice under s. 183 of the Act that they want the Agreement to cover them. In accordance with s.201(2) of the Act, I note that the agreement covers these organisations.

[22] The Agreement is approved from the date of this decision and, in accordance with s.54, will operate from 21 January 2015. The nominal expiry date of the Agreement is 13 January 2019.

COMMISSIONER

Attachment A

Calculations Based on 28 weeks working Mon-Sun 12hr shifts and 5 weeks paid annual leave

Agreement Ordinary Rate	$2,980.77	Award Ordinary Rate	$30.01
Hours	Loading	weekly total	Hours	Loading	weekly total
Ordinary Time	52	100%	$155,000.04	Ordinary Time	980	100%	$29,409.80
$0.00	Overtime	280	150%	$12,604.20
$0.00	Overtime	420	200%	$25,208.40
$0.00	Saturday	56	150%	$2,520.84
$0.00	Saturday	280	200%	$16,805.60
$0.00	Sunday	336	200%	$20,166.72
Annual Leave	No	$0.00	Annual Leave	Yes	$5,251.75
Totals	52.00	Hrs	$155,000.04	Totals	2352.00	Hrs	$111,967.31
Agreement Total Weekly Rate			$155,000.04	Model Summary
Award Total Weekly Rate			$111,967.31
Dollar / Actual Percentage Difference			$43,032.73	The Dollar / Actual Percentage Difference identifies the modelled difference between the agreement and the award in dollar terms and as a percentage.
			38.43%
Agreement Percentage Increase Required			-27.76%	The Agreement Percentage Increase Required is the amount the agreement rate would need to be increased by to satisfy the BOOT under this modelling.

 1   [2014] FWCFB 9740, [75]

 2   Armacell Australia Pty Ltd, [2010] FWAFB 9985, [41]

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