Application by MGH Employment and Training Pty Ltd

[2021] FWC 4141

[2021] FWCA 4141

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees

Application by MGH Employment and Training Pty Ltd
(AG2021/5335)

STAFF SERVICES PTY LTD CERTIFIED AGREEMENT 2000

Hospitality
DEPUTY PRESIDENT LAKE	BRISBANE, 14 JULY 2021

Application for orders pursuant to s.318(1)(a) of the Fair Work Act regarding potential transferring employees

[1] MGH Employment and Training Pty Ltd (the Applicant) has made an application for the Fair Work Commission (the Commission) seeking orders pursuant to s.318(1)(a) of the Fair Work Act 2009 (Cth) (the Act) that the Staff Services Pty Ltd Certified Agreement 2000 (the Agreement) will not cover employees who are employed by Staff Services Employment Pty Ltd (Staff Services) and who may become transferring employees (as defined in s.311(2) of the Act) and become employed by the Applicant.

[2] The Applicant completed and filed a Form F40 – Application for orders in relation to transfer of business and a statement of Darren Latham, the Applicant’s Chief HR Officer.

[3] This matter was allocated to my Chambers on 28 May 2021. On 1 June 2021, my Chambers wrote to the Applicant stating that I proposed to conduct a mention and to advise if any union has been notified. The Applicant indicated that there was no need to notify a union as none was party to the Agreement. Accordingly, a mention was convened with the Applicant on 22 June 2021.

[4] This matter is to be determined on the papers.

Background

[5] Mr Latham’s statement indicates that the Applicant currently has no employees and is not presently covered by any workplace instrument. However, it may consider employing staff in future. If it were to do so, those staff may presently be covered by the Agreement, which covers employees currently employed by Staff Services, an associated entity of the Applicant by virtue of s.311(6) of the Act. That Agreement had a nominal expiry date of 31 December 2012 but remains in force.

[6] Mr Lathan’s evidence was that the Applicant may wish to transfer across employees who may be employed by Staff Services at the time and for transferring work that will be the same or substantially the same as the work they performed for Staff Services. They would be terminated by Staff Services and hired by the Applicant within three months.

[7] The Applicant does not want the outdated Agreement to transfer with transferring employees to the Applicant. If that were to occur, it may affect the productivity of the Applicant if any non-transferring employees are employed who would be covered by the applicable Award, while the transferring employees continue to be covered by the Agreement. That said, the Applicant would not incur any specific significant economic disadvantage if the Agreement were to transfer.

[8] Mr Latham avers that no employee will be disadvantaged by the making of the orders sought. Further, he asserts that employees will be better off under the applicable award.

Statutory framework

[9] Section 318(1) of the Act provides that the Commission may, on application by a person or organisation identified in s 318(2), make the following orders:

“(a) an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;

(b) an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.”

[10] In deciding whether to make the order sought I must take into account the following matters set out in s.318(3) of the Act:

“(a) the views of:

(i) the new employer or a person who is likely to be the new employer; and

(ii) the employees who would be affected by the order;

(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment;

(c) if the order relates to an enterprise agreement—the nominal expiry date of the agreement;

(d) whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace;

(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;

(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;

(g) the public interest.”

[11] If I am minded to make the orders sought, I note that any such order must not come into operation in relation to a particular transferring employee before the later of the following:

“(a) the time when the transferring employee becomes employed by the new employer;

(b) the day on which the order is made.”    1

Employer’s submissions

[12] In respect of each of the matters I must consider, the Applicant made the following submissions:

(a) Mr Latham asserted that he was authorised to provide the views of the Applicant in relation to this matter. He confirmed that the Applicant’s view is that it does not wish for the Agreement to cover transferring employees;

(b) No employee will be disadvantaged by the order in relation to the terms and conditions of employment;

(c) The nominal expiry date of the Agreement was 31 December 2012;

(d) There are currently no employees employed by the Applicant. However, if the Agreement transferred across it may affect the productivity of the Applicant if some employees were on the Award and others on the Agreement;

(e) The Applicant would not incur significant economic disadvantageas a result of the transferable instrument covering the Applicant;

(f) The Applicant does not currently have any employees and is not covered by any workplace instrument. Therefore, this factor is irrelevant;

(g) It would not be against the public interest to grant the orders sought.

Consideration

[13] Based on the evidence of Mr Latham, I am satisfied that the Applicant is a person who is likely to be the new employer and therefore has standing to make this application. 2

[14] I note that there was no specific submission made in respect of the views of any employees who would be affected by the order. However, this is explained by Mr Latham’s statement which indicated there are currently no specific employees who are affected by the orders so consultation would be impracticable. Further, his evidence is that all potentially affected employees would be better off under the applicable Award.

[15] Having considered each of the factors in s.318(3) of the Act in light of the evidence provided and submissions made by the Applicant, I am satisfied that it is appropriate to make the orders sought.

[16] Accordingly, I order that, pursuant to s.318(a) of the Act, the Agreement will not cover employees who are employed by Staff Services and who may become transferring employees 3 and become employed by the Applicant.

[17] I also order that, in accordance with s.318(4) of the Act, this order will take effect on and from the later of the date upon which the transferring employees commence employment with the Applicant.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<AG798483 PR731689>

 1   Fair Work Act 2009 (Cth) s.318(4).

 2   Fair Work Act 2009 (Cth) s.318(2).

 3 As defined in s.311(2) of the Fair Work Act 2009 (Cth).