Application by Telstra Corporation Limited T/A Telstra
[2021] FWCFB 1841
•7 APRIL 2021
| [2021] FWCFB 1841 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 19 - Declaration for unilateral termination with FWC approval to terminate individual agreement
Application by Telstra Corporation Limited T/A Telstra
(AG2021/399)
JUSTICE ROSS, PRESIDENT | MELBOURNE, 7 APRIL 2021 |
[1] On 4 March 2021, we issued a Decision 1 (the 4 March 2021 Decision) concerning an application made by Telstra Corporation Limited T/A Telstra (Telstra) pursuant to item 19 of Schedule 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act) to unilaterally terminate 3,516 individual agreement-based transitional instruments (IABTIs or transitional instruments).
[2] Item 19 of Schedule 3 to the Transitional Act provides for the unilateral termination of IABTIs or transitional instruments that have passed their nominal expiry date.
[3] An employer or employee who wants to terminate a transitional instrument to which they are a party may:
• make a written declaration that identifies the transitional instrument and that states that the employer or employee wants to terminate the transitional instrument: item 19(2)(a), and
• apply to the Fair Work Commission (Commission or FWC) for the approval of the termination: item 19(2)(b).
[4] An application is made using Form F29 (see r.8(2)).
[5] At least 14 days before the day on which the application is made, the employer or employee must give the other party a notice that:
• identifies the transitional instrument
• states that the employer or employee intends to apply to the FWC for approval of the termination of the instrument
• states that, if the FWC approves the termination, the transitional instrument will terminate on the 90th day after the day on which the FWC makes the approval decision, and
• complies with any other requirements of the regulations: item 19(3). 2
[6] The FWC must approve the termination if the FWC is satisfied that:
• the transitional instrument applies to the employer and the employee, and
• the requirements of items 19(2) and 19(3) have been complied with: item 19(4).
[7] If the FWC approves the termination, the transitional instrument terminates on the 90th day after the day on which the FWC makes the approval decision: item 19(5).
[8] At [9] of the 4 March 2021 Decision, we expressed the provisional view that Telstra had complied with the requirements of items 19(2) and 19(3) of Schedule 3 to the Transitional Act. We directed Telstra, where practicable, to provide each employee listed in the schedule to the application with access to a copy of our Decision.
[9] Any submissions opposing our provisional views were to be filed by 4pm on 15 March 2021 and any submissions in reply filed by 4pm on 18 March 2021.
[10] Fourteen employee submissions were received, relating to 24 IABTIs (the Submissions). A summary of those submissions can be found here. On 18 March 2021, Telstra filed a reply submission.
[11] It is apparent from the terms at item 19 of Schedule 3 to the Transitional Act that the Commission’s role is quite limited. The FWC must approve the termination of an IABTI identified in the schedule to the Application if it is satisfied that:
• the IABTI applies to Telstra and the employee
• Telstra made the declaration required under item 19(2) of Schedule 3 to the Transitional Act, and
• Telstra gave the employee the notice under item 19(3) of Schedule 3 to the Transitional Act,
regardless of whether or not the employee to whom the IABTI applies agrees to the termination.
[12] We made it clear in the 4 March 2021 Decision that submissions responding to our provisional view must be directed to the matters which are relevant to our determination of Telstra’s application, namely the matters set out in the three dot points above.
[13] The 14 employee submissions are not directed to the matters which are relevant to the Commission’s decision. There is nothing in the Submissions which opposes the Commission’s provisional view that Telstra has complied with the requirements in the Transitional Act.
[14] We note that in its reply submission Telstra addresses the various issues raised in submissions by the employees to whom an IABTI applies, as follows:
‘We appreciate, however, that employees to whom an IABTI applies (Impacted Employees) may have some concerns and questions relating to the proposed termination of IABTIs. We have set out under the relevant headings below a brief response to the concerns outlined in the Submissions. We intend to continue our discussions with employees with a view to addressing those concerns and any other questions and concerns raised by Impacted Employees.
1. Lack of communication and uncertainty regarding future entitlements
Telstra took a number of steps to communicate with Impacted Employees regarding the proposed termination of their IABTIs and their future entitlements:
• On 21 January 2021 Telstra wrote to Impacted Employees notifying them that Telstra intended to file an application to terminate IABTIs. In the email, Telstra:
◦ explained the process involved in terminating IABTIs;
◦ Impacted Employees that following termination of their IABTI, their terms and conditions of employment would be governed by the Telstra Enterprise Agreement 2019-2021 (Telstra EA)1;
◦ reassured Impacted Employees that their pay would not be reduced and that any “additional” terms and conditions provided under their IABTI (such as additional notice or entitlements to car parking) would be taken into account to ensure they are appropriately recognised by Telstra;
◦ provided links to additional resources which contained further information regarding the proposed termination of IABTIs, including an AskHR Article with frequently asked questions and a factsheet. The factsheet set out the key differences between IABTIs and the Telstra EA and covered matters such as remuneration, discretionary leave and moving within the Telstra Group; and
◦ provided contact information and links to question and answer sessions to provide Impacted Employees with the opportunity to ask questions and take part in discussions.
• Between 27 January 2021 and 4 February 2021, Telstra gave each Impacted Employee notice of Telstra’s intention to terminate their IABTI (the Item 19(3) Notice). The covering emails to the Item 19(3) Notices provided an overview of next steps and links to additional resources (including the AskHR Article). The factsheet and frequently asked questions document continues to be available to Impacted Employees.
• On 24 February 2021, Telstra served the Application on Impacted Employees. In the covering email, Telstra:
◦ referred employees to the Ask HR Article;
◦ included a summary of next steps; and
◦ explained that a more detailed overview of terms and conditions under the Telstra EA would be provided from mid-April 2021.
Impacted Employees were reminded that overall they would not be disadvantaged by the termination of their IABTI.
Telstra notes that one of the Impacted Employees has expressed concerns that their Australian Workplace Agreement (AWA) could not be located. Telstra received a request for a copy of that employee’s AWA on 5 March 2021. As the AWA dated back to 2001 Telstra did not have an electronic copy of the AWA. A hard copy was requested from archives and has now been sent to the employee.
2. Redundancy entitlements
Some Impacted Employees have expressed concerns that their redundancy entitlements will be subject to change when the current enterprise agreement is renegotiated.
At the outset, we note that not all IABTIs contain identical redundancy provisions. Some IABTIs only provide for severance payments “determined in accordance with Telstra policy” as varied from time to time. Where this is the case, the Telstra EA (and any replacement agreement) would provide employees with greater certainty regarding their severance entitlements in the event that they are retrenched by Telstra.
We note also that Impacted Employees will be able to fully participate in the bargaining process for any new enterprise agreement that will apply to them. All employees that will be covered by any new proposed agreement will have the opportunity to approve the agreement by voting for it.
3. Personal leave entitlements
The Telstra EA and the Telstra Personal (Sick and Carer’s) Leave Policy provide for 15 days paid personal leave for each year of continuous service.
There is variation between personal leave provisions in IABTIs depending on when they were made. Some IABTIs provide for 10 days personal leave for each year of continuous service with additional personal leave at Telstra’s discretion while others provide for reasonable paid sick leave if an employee is unable to attend work as a result of a genuine illness or injury. In each case Telstra has discretion to decide how much additional paid personal/sick leave should be granted to an employee having regard to all the relevant circumstances. There is no entitlement to unlimited paid sick leave.
4. Information about termination of IABTIs
Telstra explained to Impacted Employees in the email of 21 January 2021 why it was taking steps to unilaterally terminate the IABTIs. Specifically, Telstra explained that only 10% of employees are employed under IABTIs and that Telstra wished to standardise terms and conditions of employment and move Impacted Employees onto the Telstra EA with its industry leading terms and conditions.
In any event there is no requirement under the TPCA Act for Telstra to provide reasons for the unilateral termination of IABTIs.
5. Long Service Leave
The concern relating to long service leave appears to relate to Telstra’s ability to direct employees to take long service leave. Telstra’s Long Service Leave policy deals with the requirement to take long service leave where employees have accrued more than 90 days’ long service leave. The policy applies to all Telstra employees including Impacted Employees and employees to whom the Telstra EA applies. The Telstra EA contains a commitment that it would not (while the Telstra EA is in operation) modify the provisions in Telstra policy that set out the circumstances in which Telstra may require an employee to take long service leave. No such commitment is provided in any IABTIs.
As set out above Telstra will continue to communicate with Impacted Employees about the above matters and any other concerns. We intend to provide each Impacted Employee with an overview of their Telstra EA terms and conditions from mid-April 2021. It is also our intention to meet with each of the Impacted Employees who have filed Submissions to discuss their concerns further.’ [Footnote omitted]
[15] For our part we would encourage Telstra to continue to engage constructively and openly with the affected employees regarding the issues they have raised.
[16] In its reply submission, Telstra submits that the Commission should affirm its provisional view and approve the termination of IABTIs on the basis that the requirements under item 19(4) of Schedule 3 to the Transitional Act have been met. We agree that all aspects of item 19(4) have been met and accordingly that the Commission must approve termination of the IABTIs.
[17] There are 3 procedural matters. First, the Form F29 application and covering letter make clear that the application is made under item 19(3) of Schedule 3 to the Transitional Act, however the Schedule itself does not do so. We will dispense with the rule 27(3)(b)(ii) requirement in relation to the Schedule under rule 6(1) of the Fair Work Commission Rules 2013 (FWC Rules).
[18] Second, rules 27(2)(a) and (b) of the FWC Rules require respectively that an application under item 19 of Schedule 3 to the Transitional Act be accompanied by a declaration made by a person authorised to do so setting out the basis upon which the Commission can be satisfied that the requirements of items 19(2) and (3) of Schedule 3 to the Transitional Act have been met, and by a copy of the written declaration that was made in accordance with item 19(2). The declaration made on behalf of Telstra by Mr Darren Fewster is directed to the requirements of both rules 27(2)(a) and (b). To the extent that lodging a single declaration is inconsistent with the requirements of rule 27(2), we dispense with those requirements.
[19] Third, there are a small number of errors in the Schedule. These are explained in email correspondence from Telstra dated 25 March 2021. We propose to amend the Schedule in accordance with the advice received from Telstra.
[20] We confirm our provisional view and approve the termination of the IABTIs operative from 7 April 2021.
[21] The termination of the IABTIs will take effect on 6 July 2021, being the 90th day after the day on which we have made our approval decision.
PRESIDENT
Printed by authority of the Commonwealth Government Printer
<PR728374>
1 [2021] FWCFB 1191
2 There are no additional requirements included in the Fair Work (Transitional Provisions and Consequential Amendments) Regulations 2009.
1
0