Airservices Australia and the Civil Air Operations Officers Association AIRSERVICES AWARD 2000
[2016] FWCFB 3560
•30 May 2016
[2016] FWCFB 3560
The attached document replaces the document previously issued with the above code on 30 May 2016.
The Print Id. (PR580560) appearing in the price code was incorrect and has been amended.
Kris Pozvek
On behalf of the Full Bench
9 June 2016
| [2016] FWCFB 3560 |
| FAIR WORK COMMISSION |
REASONS FOR DECISION |
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 6, Item 4—Application to make a modern award to replace an enterprise instrument
AIRSERVICES AWARD 2000
(EM2013/34 and EM2013/56)
Commonwealth employment | |
VICE PRESIDENT CATANZARITI | BRISBANE, 30 MAY 2016 |
Application for a modern enterprise award to replace the Airservices Award 2000- whether modern enterprise award should be made - modern enterprise award should be made in the circumstances - order to be settled by member of full bench.
Introduction
[1] This decision relates to applications under item 4 of Schedule 6 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Transitional Act) for the Fair Work Commission to make a modern enterprise award to replace the Airservices Award 2000 (Current Enterprise Award).
[2] The applications were made by Airservices Australia and the Civil Air Operations Officers Association (CAOOA).
[3] On 27 April 2016 the parties filed the following material in support of the applications:
a) Draft Proposed Award; and
b) Draft Order.
[4] On 4 May 2016 the parties filed the following further material in support of the applications:
a) Joint outline of submissions (Exhibit “B”); and
b) Witness statement of Linda Eileen Glover, Manager Employee Relations at Airservices (Exhibit “A”).
[5] The applications were supported by:
- At the hearing of this matter on 23 May 2016:
- Mr J Lovell, a solicitor with Ashurst appeared on behalf of Air Services Australia with permission pursuant to s.596(2)(a) of the Fair Work Act 2009;
- Mr H Lawrence appeared for the UFUA;
- Ms J Ponton with Ms S Berenyi appeared for CAOOA;
- Mr K Barlow appeared for the CPSU; and
- Ms S Gheller appeared for APESMA.
a) Airservices Australia;
b) CAOOA;
c) Community and Public Sector Union (CPSU);
d) United Firefighters Union Australia (UFUA);
e) Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; and
f) Association of Professional Engineers, Scientists and Managers, Australia (APESMA).
[6] At the conclusion of the hearing we announced our decision to make the Airservices Australia Enterprise Award 2016 (Proposed Award) which had been agreed between the parties subject to the finalisation of its terms in conference with Commissioner Johns.
[7] On 25 May 2016 the parties jointly filed a further amended version of the Proposed Award incorporating amendments proposed during the Hearing, namely the inclusion of the revised model term for the cashing out of annual leave.
[8] These are the reasons for reasons for our decision.
The approach
[9] The approach to be taken to the making of an enterprise modern award was established by a Full Bench in Commonwealth of Australia acting through the Minister Assisting the Prime Minister for the Public Service v the Community and Public Sector Union and Others. 1 We adopt that approach in this matter.
The legislative requirements
[10] The role of the Commission in an application to make a modern enterprise award is governed by sub-item 4(5) of Schedule 6 to the Fair Work (Transitional Provisions and Consequential Amendments Act 2009 (Transitional Act) which provides:
(5) In deciding whether or not to make a modern enterprise award, and in determining the content of that award, the FWC must take into account the following:
(a) the circumstances that led to the making of the enterprise instrument rather than an instrument of more general application;
(b) whether there is a modern award (other than the miscellaneous modern award) that would, but for the enterprise instrument, cover the persons who are covered by the instrument, or whether such a modern award is likely to be made in the Part 10A award modernisation process;
(c) the content, or likely content, of the modern award referred to in paragraph (b) (taking account of any variations of the modern award that are likely to be made in the Part 10A award modernisation process);
(d) the terms and conditions of employment applying in the industry in which the persons covered by the enterprise instrument operate, and the extent to which those terms and conditions are reflected in the instrument;
(e) the extent to which the enterprise instrument provides enterprise-specific terms and conditions of employment;
(f) the likely impact on the persons covered by the enterprise instrument, and the persons covered by the modern award referred to in paragraph (b), of a decision to make, or not make, the modern enterprise award, including any impact on the ongoing viability or competitiveness of any enterprise carried on by those persons;
(g) the views of the persons covered by the enterprise instrument;
(h) any other matter prescribed by the regulations.
[11] Item 6 links the modern enterprise award objective to the modern award objective and the minimum wages objective found at ss.134 and 284 of the Act. It provides:
6 The modern enterprise awards objective
(1) The modern awards objective and the minimum wages objective apply to the FWC making a modern enterprise award under this Division.
(2) However, in applying the modern awards objective and the minimum wages objective, the FWC must recognise that modern enterprise awards may provide terms and conditions tailored to reflect employment arrangements that have been developed in relation to the relevant enterprises. This is the modern enterprise awards objective.
[12] This is a legislative requirement for the Commission to recognise, in the context of the modern awards objective and the minimum wage objective, that modern enterprise awards may provide terms and conditions tailored to reflect employment arrangements that have been developed in relation to the relevant enterprises. The modern awards objective, set out in s.134 of the Fair Work Act 2009 (the Act), is as follows:
“134 The modern awards objective
What is the modern awards objective?
(1) The FWC must ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions, taking into account:
(a) relative living standards and the needs of the low paid; and
(b) the need to encourage collective bargaining; and
(c) the need to promote social inclusion through increased workforce participation; and
(d) the need to promote flexible modern work practices and the efficient and productive performance of work; and
(da) the need to provide additional remuneration for:
(i) employees working overtime; or
(ii) employees working unsocial, irregular or unpredictable hours; or
(iii) employees working on weekends or public holidays; or
(iv) employees working shifts; and
(e) the principle of equal remuneration for work of equal or comparable value; and
(f) the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden; and
(g) the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards; and
(h) the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy.
This is the modern awards objective.”
[13] It is also relevant to draw attention to item 11 of Division 3 which provides:
11 Enterprise instrument modernisation process is not intended to result in reduction in take-home pay
(1) The enterprise instrument modernisation process is not intended to result in a reduction in the take-home pay of employees.
(2) An employee’s take-home pay is the pay an employee actually receives:
(a) including wages and incentive-based payments, and additional amounts such as allowances and overtime; but
(b) disregarding the effect of any deductions that are made as permitted by section 324 of the FW Act.
Note: Deductions permitted by section 324 of the FW Act may (for example) include deductions under salary sacrificing arrangements.
(3) An employee suffers a modernisation-related reduction in take-home pay if, and only if:
(a) a modern enterprise award made in the enterprise instrument modernisation process starts to apply to the employee when the award comes into operation; and
(b) the employee is employed in the same position as (or a position that is comparable to) the position he or she was employed in immediately before the modern enterprise award came into operation; and
(c) the amount of the employee’s take-home pay for working particular hours or for a particular quantity of work after the modern enterprise award comes into operation is less than what would have been the employee’s take-home pay for those hours or that quantity of work immediately before the award came into operation; and
(d) that reduction in the employee’s take-home pay is attributable to the enterprise instrument modernisation process.
[14] Item 11 highlights the injunction contained in the original request provided by the then Minister which related to disadvantage to employees.
The application of the legislative task
[15] We now turn to each of the matters that we took into account.
The circumstances that led to the making of the enterprise instrument rather than an instrument of more general application: Item 4(5)(a)
[16] The parties provided a history of the current Enterprise Award. That history can be summarised as follows:
(a) Airservices is the sole provider of civilian Air Traffic Control (ATC) services and related services within Australia. Airservices manages aircraft through all phases of flight in Australian airspace, which is 11 per cent of the world’s airspace and represents approximately 140 million passengers flying on more than four million flights annually. ATC services are provided in accordance with Civil Aviation Safety Authority (CASA) regulations, which include a complex licensing and endorsement framework for employees performing operational roles.
(b) Airservices employees are engaged by Airservices under the Air Services Act1995 (Air Services Act). Airservices employs persons in specialist operational classifications, including air traffic controllers, aviation traffic and flight information, and aviation rescue fire fighters (ARFF), and a range of technical, trade and corporate roles.
(c) Airservices employees have been employed by Airservices under the Air Services Act since the establishment of Airservices in July 1995. Employees performing Airservices’ functions were previously employed: (a) as employees of the Civil Aviation Authority under the Civil Aviation Act 1988 (June 1990 to July 1995); and (b) as Commonwealth public servants under the Public Service Act 1922 and its predecessor.
(d) Employees providing ATC and ARFF services were public servants under the Public Service Act 1902 and the Public Service Act 1922, and were subject to the terms and conditions that applied to Commonwealth public servants. However, there were specific instruments setting terms and conditions for employees performing ATC and ARFF functions
(e) Since 1990, the terms and conditions for Airservices employees have evolved separately from the terms and conditions covering Commonwealth public servants culminating in the current Enterprise Award.
(f) The Current Enterprise Award contains terms and conditions of employment which were drawn from the Staff Policy Manual which at that time determined the terms and conditions of employment of employees of Airservices.
[17] It can be seen from this brief review that the current Enterprise Award has had a long and distinct history. This factor weighed in favour of making a modern enterprise award.
Whether there is a modern award (other than the miscellaneous modern award) that would, but for the enterprise instrument, cover the persons who are covered by the instrument, or whether such a modern award is likely to be made in the Part 10A award modernisation process: Item 4(5)(b).
[18] It was submitted that there is no single award that would, but for the Proposed Award, cover all employees who are covered by the current Enterprise Award.
[19] The parties further submitted that the persons covered by the current Enterprise Award (and to be covered by the Proposed Award) work in the Commonwealth public sector and that, at present, there is no industry-based modern award that covers employees in that industry.
[20] The parties submitted that the following occupation-based modern awards may cover a limited number of groups of Airservices employees:
(a) the Fire Fighting Industry Award 2010 may cover ARFF employees. However, this would only be the case if Airservices was found to be an employer in the fire fighting industry in so far as it provides ARFF services. In any event, Airservices and the UFUA agree that it may be problematic to apply the Fire Fighting Industry Award 2010 to the work performed by ARFF employees;
(b) Graphic Arts, Printing and Publishing Award 2010;
(c) Joinery and Building Trade Award 2010;
(d) Manufacturing and Associated Industries and Occupations Award 2010; and
(e) Professional Employees Award 2010.
[21] It may be observed that coverage by a number of modern awards may lead to difficulties in enterprise bargaining. Further, it might lead to an unnecessary fragmentation of the award safety net and would fail to achieve the modern awards objective.
[22] The parties also submitted that the Miscellaneous Award 2010 [MA000104] (Miscellaneous Award) would cover a significant proportion of Airservices employees.
[23] As was made clear in the award modernisation Full Bench decision dated 4 December 2009 ([2009] AIRCFB 945 at paragraph 153):
“We agree with those who have suggested that the coverage of the award is very narrow and likely to be limited in time where emerging industries are concerned or where the expansion of coverage of a modern award is involved. Accordingly we do not think the award should contain a comprehensive safety net designed for any particular occupation or industry. Rather it should contain basic conditions only, leaving room for the application of an appropriate safety net in another modern award in due course.”
[24] The Miscellaneous Award was not created or designed to be a universal safety net but to be a transition point to another modern award whose coverage may require review.
[25] These circumstances weighed in favour of creating a modern enterprise award.
The content, or likely content, of the modern award referred to in paragraph (b) (taking account of any variations of the modern award that are likely to be made in the Part 10A award modernisation process): Item 4(5)(c)
[26] The parties submitted that the content of the listed modern industry or occupation based awards would not reflect the terms and conditions currently operating with regards to Airservices employees.
[27] Further, the parties submitted that the reasoning of the Full Bench in the APS Award modernisation decision can be applied in the case of Airservices employees, which recognised that it was ([2015] FWCFB 616 at paragraph 19):
“…apparent from the history of the awards which have been present in the APS that the content of various industry specific modern awards do not reflect the needs, terms and conditions in the APS. This is a factor in favour of making a modern enterprise award.”
[28] It is apparent from the history of the industrial arrangements which have applied to Airservices employees that the content of the various industry specific modern awards do not reflect their needs and terms and conditions of employment. This factor weighed in favour of making a modern enterprise award.
The enterprise instrument provides enterprise specific terms and conditions of: Item 4(5)(e)
[29] The parties submitted that, while the Commission in Coleambally Irrigation Co-operative Limited v AWU and ors [2014] FWCFC 2170 found that it was not provided with sufficient information to assess the extent to which the terms and conditions in the industry were reflected in the enterprise instrument, it directed attention to the other enterprise awards applying to those organisations operating in the industry and the large number of enterprise agreements which appeared to cover activities in the relevant industry.
[30] The parties further submitted that the terms and conditions that currently apply to Airservices employees covered by the current Enterprise Award are set out in the following instruments:
● Airservices Australia (Air Traffic Services and Supporting Air Traffic Services) Enterprise Agreement 2012-2015 (ATC EA);
● Airservices Australia (Air Traffic Control Line Manager) Enterprise Agreement 2014- 2017 (ALM EA);
● Airservices Australia (Aviation Rescue and Fire Fighting) Enterprise Agreement 2013- 2017 (ARFF EA); and
● Airservices Australia Enterprise Agreement 2013-2017 (Corporate EA).
[31] These factors weighed in favour of making a modern enterprise award.
The terms and conditions of employment applying in the industry in which the persons covered by the enterprise instrument operate, and the extent to which those terms and conditions are reflected in the instrument: Item 4(5)(e)
[32] The parties submitted that there are enterprise specific terms and conditions that apply to Airservices employees, contained in the enterprise agreements listed above which reflect the terms and conditions in the current Enterprise Award, these include:
- Time off in lieu of overtime (clause 18.19 ATC EA, Clause 4.6 ARFF EA, and clause 4.3.7 Corporate EA);
- Emergency Duty and restriction duty (clause 18.20 ATC EA, clause 4.4 and 4.6 ARFF EA and clause 4.6 and 4.7 Corporate EA);
- Transfer provisions (clause 20 ATC EA, clause 4.10 ARFF EA and clause 4.9 Corporate EA);
- Remote locality allowances and leave fares (clause 22.5, 22.6 and 22.7, 22.9 and 22.10 ATC EA, clause 4.12.6, 4.12.7 and 4.13 ARFF EA and clause 4.11.7 and 4.11.8 Corporate EA);
- Education reimbursement (clause 22.8 ATC EA, clause 4.11.9 ARFF EA and clause 10.9 Corporate EA);
- Remote locality additional leave (clause 36.9 ATC EA, clause 6.9 ARFF EA and clause 6.3.10 Corporate EA);
- Spectacle allowance (clause 21.4 ATC EA, clause 4.11.3 ARFF EA and clause 4.10.3 Corporate EA);
- Representative allowance (clause 22.11 ATC EA);
- Additional personal leave (clause 37.2 and 38.2 ATC EA, clause 6.5 ARFF EA and clause 6.4 Corporate EA);
- Paid parental leave (clause 44.11 ATC EA, clause 6.16 ARFF EA and clause 6.12 Corporate EA);
- Preservation of Early Retirement Benefit for particular employees (clause 57 ATC EA, clause 5.15 ARFF EA and Schedule 1, clause 6 Corporate EA);
- Flex-time arrangements (clause 4.2.3 Corporate EA);
- On the Job Training Instructor Allowance (clause 22.12 ATC EA); and
- Airport category allowance (clause 4.12.2 ARFF EA).
[33] The parties further submitted that in addition to the terms and conditions outlined above, the current Enterprise award contains other terms and conditions specific to Airservices, including:
- Complexity allowance (clause 24.2);
- Optical Fibre and Filled Cable Allowance (clause 24.12);
- Radar Advisory Service (RAS) Allowance (clause 24.16);
- Reimbursement of Insurance Premiums (clause 24.17);
- Simultaneous Operations Allowance (clause 24.20);
- Special Rates (clause 24.22); and
- Two Block Leave Roster (clause 26.7).
[34] The parties also submitted that:
- if the Proposed Award were not made to replace the current Enterprise Award, the classifications and established pay relativities which are contained in the current Enterprise Award would be lost and the minimum remuneration of Airservices employees would be set in other awards of more general application; and
- the Proposed Award incorporates each of the enterprise-specific terms referred to above from the current Enterprise Award, and maintains a number of other terms and conditions from the current Enterprise Award.
[35] Ms Glover gave evidence about the specific terms and conditions of employment. In summary the evidence was to the effect that:
● As of 31 March 2016, Airservices employed 4,478 employees;
● Airservices employs persons in ATC, ARFF, engineering, technical services, education and training, information technology, human resource management, communications, security, safety, environment, financial management and administration; and
● The terms and conditions of employment for most Airservices employees are set out in the following enterprise agreements:
- ATC EA — 1,376 employees in the following classification groups: Air Traffic Controller; Airways Data Team; Simulation Support Officer; Flight Data Coordinator;
- ALM EA — 51 employees employed in the position of Air Traffic Control Line Manager;
- ARFF EA — 863 employees in ARFF roles up to and including the Fire Commander classification; and
- Corporate EA — 1,853 employees in the following classification Agreement 2013-2017 groups: ASA; Technical Officer/General Services; Officer/Emergency Vehicle Technician; Technology Professional; Upper Air Space High Frequency; National Operations Centre;
● Managerial employees (other than Air Traffic Control Line Managers covered by the ALM EA) have their terms and conditions of employment set out in individual employment arrangements.
[36] These factors weighed in favour of making a modern enterprise award.
The likely impact on the persons covered by the enterprise instrument, and the persons covered by the modern award referred to in paragraph (b), of a decision to make, or not make, the modern enterprise award, including any impact on the ongoing viability or competitiveness of any enterprise carried on by those persons: Item 4(5)(f).
[37] The parties jointly submitted that
- A majority of Airservices employees are covered by an enterprise agreement that applies to the employee’s employment in Airservices. The direct impact of the Proposed Award will be relevant to the operation of the Better Off Overall Test (BOOT).
- If the Proposed Award were not made and the current Enterprise Award were terminated, the BOOT would be assessed against the Miscellaneous Award, and relevant occupation-based modern awards, which do not contain enterprise-specific terms and conditions that reflect the particular circumstances of employment in Airservices. The Miscellaneous Award contains basic terms and conditions, and would not provide a fair or relevant minimum safety net for the purpose of the BOOT.
- If the Proposed Award were made, enterprise agreements would be assessed against a single enterprise-specific award containing terms and conditions specific to Airservices. The Proposed Award would provide a fair and relevant minimum safety net for the purpose of the Commission’s assessment of whether an applicable enterprise agreement passes the BOOT.
- The making of the Proposed Award would not adversely impact the viability or competitiveness of Airservices.
[38] The parties submitted that, if the Proposed Award were made, the BOOT test would be assessed against a single enterprise specific award containing relevant terms and conditions of employment. There is considerable force to this argument and it is a factor in favour of making a modern enterprise award.
[39] These factors weighed in favour of making the modern enterprise award.
The views of the persons covered by the enterprise instrument: Item 4(5)(g)
[40] All parties to the current Enterprise Award supported the making of this modern enterprise award. No person opposed the award. While consent is not decisive of the matter, it is a factor in favour of making a modern enterprise award.
Any other matter prescribed by the regulations: Item 4(5)(h)
[41] There were no regulations relevant to this criterion.
Should a modern enterprise award be made?
[42] Airservices Australia is a unique organisation. There is no convenient alternative award that can be said to better satisfy the modern awards objective than a modernised Airservices Award 2000.
[43] The history of current Enterprise Award award discloses a rationale for its existence which remains current today. The terms of the Current Enterprise Award contain enterprise specific terms. While some of these can and should be contained in enterprise agreements, the fact remains that the award was developed for this enterprise, and once consolidated and modernised, remains the most suitable vehicle for a fair and relevant minimum safety net into the future. In our view there was a compelling case for the making of a modern enterprise award for Airservices Australia.
[44] The above factors clearly made the case for such an outcome. We considered that the Proposed Award should be made.
[45] Consequently, we made the Award in the terms agreed between the parties as amended and filed in the Commission on 25 May 2016.
VICE PRESIDENT
Appearances:
J Lovell, Aushurst, for the Air Services Australia
M Baillie, from theAir Services Australia
K Barlow from theCommunity and Public Sector Union.
H Lawrence, from the United Firefighters Union Australia
J Ponton and S Berenyi, from theCivil Air Operations Officers Association
Hearing details:
2016.
Sydney, Canberra, Brisbane, Melbourne
May 23.
1 [2015] FWCFB 616.
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