Agnew Legal Pty Ltd
[2017] FWCA 15
•5 JANUARY 2017
| [2017] FWCA 15 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement
Agnew Legal Pty Ltd
(AG2016/4072)
D&A INVESTMENT HOLDINGS PTY LTD - ENTERPRISE AGREEMENT
Fast food industry | |
DEPUTY PRESIDENT BULL | SYDNEY, 5 JANUARY 2017 |
Application for approval of the D&A Investment Holdings Pty Ltd - Enterprise Agreement 2016.
[1] An application has been made by Agnew Legal Pty Ltd (the applicant) for the approval of an enterprise agreement known as the D&A Investment Holdings Pty Ltd – Enterprise Agreement (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act) and is a single enterprise agreement.
[2] The Agreement covers all employees engaged by the employer.
Late lodgement
[3] The application was lodged 21 days after the agreement was made, and not within 14 days as required by s185(3)(a) of the Act. The applicant did not offer an explanation as to why the lodgement was outside time, but acknowledged the delay in its F17 statutory declaration and stated that during the time between the making of the Agreement and lodging the application, the employer has been paying employees the above award Agreement rates of pay, so that the delay has not resulted in prejudice to employees.
[4] Pursuant to s.185(3)(b), in these circumstances I consider it fair to extend the time for making the application to the date it was actually made.
Better off overall test
[5] In its correspondence to the applicant, the Commission noted that the Agreement contains a number of provisions that may leave some employees worse off under the Agreement than under the Fast Food Industry Award 2010 (the Award), being the relevant modern award for the purpose of the better off overall test.
Rates of pay
[6] The Commission’s analysis suggested that, while the base rates of pay under the Agreement are between 4-8% above the corresponding Award rates, the rates of pay may not be high enough to compensate employees for the reductions under the Agreement, including:
● Removal of weekend penalties; and
● Removal of public holiday penalty; and
● Removal of annual leave loading.
[7] The Commission noted the “parameter of hours” clause in appendix A, but noted that it did not appear that the parameters of hours apply to part-time or casual employees.
[8] The Commission requested the applicant to address this concern by way of an undertaking either lifting the base rates of pay under the Agreement or restricting the hours employees may work which would be subject to penalty rates in the Award.
[9] The applicant provided a number of versions of draft undertakings. The undertakings provided did not satisfy the Commission of its concerns, and on 15 November 2016, the Commission wrote to the applicant suggesting specific undertakings that would address the Commission’s concerns in relation to the better off overall test.
[10] The applicant has now provided an undertaking lifting the base rates of pay so that they are between 23.5-26% above the Award base rates of pay. Further, the applicant has undertaken at Appendix A of the undertakings that full-time, part-time and casual employees in all classifications will work at least 50% of their hours during the hours not subject to penalty rates under the Award, that is between 6.00am to 9.00 from Monday to Friday. Based on the Commission’s analysis, this undertaking will ensure that employees will be at least 20% better off financially than they would be under the Award.
Part-time employees’ ordinary hours
[11] The underlying Award makes clear at clause 12.1 that a part-time employee is an employee who is engaged to work fewer than 38 ordinary hours per week and “has reasonably predictable hours of work.” It goes on to state in sub clause 12.2:
“12.2 At the time of first being employed, the employer and the part-time employee will agree, in writing, on a regular pattern of work, specifying at least:
● the number of hours worked each day;
● which days of the week the employee will work;
● the actual starting and finishing times of each day;
● that any variation will be in writing;
● that the minimum daily engagement is three hours; and
● the times of taking and the duration of meal breaks.
12.3 Any agreement to vary the regular pattern of work will be made in writing before the variation occurs.
12.4 The agreement and any variation to it will be retained by the employer and a copy given by the employer to the employee.
12.5 An employer is required to roster a part-time employee for a minimum of three consecutive hours on any shift.
12.6 An employee who does not meet the definition of a part-time employee and who is not a full-time employee will be paid as a casual employee in accordance with clause 13—Casual employment.”
[12] The overtime provisions in clause 26 indicate the overtime penalties that will apply, in the case of part-time employees, to all hours worked in excess of the agreed hours, or varied hours.
[13] The provisions in the Award are clear and specific in regard to part-time work. They intend, firstly, that a regular pattern of work will be agreed upon at the outset. Secondly, hours in excess of those agreed upon or varied in writing will attract payment of overtime.
[14] The Agreement requires no such agreement to be reached between the employer and part-time employees. In relation to the hours of work for part-time employees the Agreement states:
“4.1.2 Hours of work – Part-time Employees
The arrangement of hours of work for a part-time Employee will be implemented as follows:
(a) A minimum of four hours per week and a maximum of 37.5 hours. Provided that these hours can be averaged over a 2, 3, or 4 week period;
(b) A minimum of 3 hours per shift and a maximum of 11 hours per shift;
(c) All ordinary time to be worked within a span of 12 hours per day;
(d) A maximum of 10 consecutive days may be worked with up to four full days off;
(e) Broken shifts may be worked within a span of 12 hours per day; and
(f) A minimum break of 8 hours between the finishing of one shift on a day and the commencement of another shift on the following day.”
[15] The Commission raised the concern with the applicant that the part-time terms and conditions in the Agreement appear to be less beneficial than the terms and conditions in the Award. This was a significant concern for the Commission because the applicant’s F17 statutory declaration indicates that the Agreement is intended to cover employees who are overwhelmingly to be engaged on a part-time basis.
[16] In response the applicant proffered an undertaking which would replace sub clause 4.1.2 in the following terms:
“4.1.2 Hours of work – Part-time Employees
Upon engagement of a Part-time Employee, the Employer and the Employee will agree in writing a reasonably predictable pattern of ordinary hours of work for the Employee. Such agreement can only be varied by agreement in writing between the Employee and the Employer. The agreed reasonably predictable ordinary hours of work must be within the following parameters:
(a) A minimum of four hours per week and a maximum of 37.5 hours. Provided that these hours can be averaged over a 2, 3, or 4 week period;
(b) A minimum of 3 hours per shift and a maximum of 11 hours per shift;
(c) All ordinary time to be worked within a span of 12 hours per day;
(d) A maximum of 10 consecutive days may be worked with up to 4 non-working days;
(e) Broken shifts may be worked within a span of 12 hours per day; and
(f) A minimum break of 8 hours between the finishing of one shift on a day and the commencement of another shift on the following day.”
[17] Evidently, there are differences in the wording of the entitlements in the Award and those in the Agreement for part-time employees; however the Commission is satisfied the effect is substantially the same. The conditions in the Award and the Agreement are predicated on part-time employees having an agreed “reasonably predictable” pattern of ordinary hours. While the Agreement provides for a parameter of hours which the employees’ ordinary hours may be worked within, the ordinary hours themselves will be those agreed upon in writing, or varied in writing by the employer and employee. It follows that if the ordinary hours are those hours which are mutually agreed or mutually varied, then all hours worked in excess of those hours will attract the payment of overtime in accordance with clause 4.2.1 of the Agreement, which states:
“4.2.1 Overtime
All hours worked by an Employee in excess of the hours of work set out in clauses 4.1.1 and 4.1.2 of this Agreement.”
[18] The Commission is satisfied that the undertaking provided by the applicant preserves the requirement for mutual agreement in respect of the pattern of ordinary hours for a part-time employee, as well as the entitlement to overtime payment for hours worked in excess of a part-time employee’s ordinary hours.
Undertakings provided
[19] The undertakings provided by the applicant address the concerns raised by the Commission.
[20] The undertakings are taken to be a term of the Agreement and a copy is marked Annexure A. The undertakings are not so substantial that if asked to vote again the employees who voted would not approve the Agreement. I am therefore satisfied that the undertakings do not result in a substantial change to the Agreement, as per s.190(3)(b) of the Act. The undertakings should be brought to the attention of the employees.
Approval
[21] Taking into account the higher base rates of pay under the Agreement in conjunction with the undertakings provided by the applicant, I am satisfied that the Agreement results in employees being better off overall under the Agreement.
[22] I am satisfied that each of the requirements of ss.186, 187 and 188 of the Act as are relevant to this application for approval have been met.
[23] The Agreement is approved. In accordance with s.54(1), the Agreement will operate 7 days from approval. The nominal expiry date of the Agreement is 30 June 2017.
DEPUTY PRESIDENT
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Annexure A
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