AstraZeneca Pty Ltd

[2019] FWCA 6981

[2019] FWCA 6981

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement

AstraZeneca Pty Ltd
(AG2019/3008)

ASTRAZENECA ENTERPRISE AGREEMENT 2019

Pharmaceutical industry
DEPUTY PRESIDENT BULL	SYDNEY, 10 OCTOBER 2019

Application for approval of the AstraZeneca Enterprise Agreement 2019.

[1] An application (Form F16) has been filed by AstraZeneca Pty Ltd(the employer) for the approval of an enterprise agreement known as the AstraZeneca Enterprise Agreement 2019 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single-enterprise agreement as per s.172(2) of the Act.

[2] The employer provided responses to the following issued raised by the Commission.

Relevant award classifications for Electricians

[3] The Commission requested that the employer advise the basis upon which it asserted that the translating classifications for Electricians are Manufacturing/Production Workers Grade 3 or 4 under the Pharmaceutical Industry Award (the Award/Pharmaceutical Award) and not the Manufacturing and Associated Industries and Occupations Award 2010 (the Manufacturing Award).

[4] The employer submitted that the Pharmaceutical Award applies to employers and their employees engaged in the ‘pharmaceutical industry’ and that clause 3 of the Pharmaceutical Award defines the ‘pharmaceutical industry’ as meaning:

(a)   the manufacture and production of prescription pharmaceuticals or of both prescription and non-prescription pharmaceuticals; or

(b)   the wholesaling of prescription pharmaceuticals or of both prescription and non-prescription pharmaceuticals; or

(c)   processes and activities that are incidental or ancillary to the manufacture and production of prescription pharmaceuticals or of both prescription and non-prescription pharmaceuticals.

[5] The employer submitted that the role of an Electrician covered by the Agreement is, at a minimum, involved in processes and activities that are incidental or ancillary to the manufacture and production of pharmaceuticals. This is the principal purpose of the role of the Electrician and forms the major, substantial and principal aspect of an Electrician’s work.

[6] The classifications in the Pharmaceutical Award directly reference the use of tools and equipment, operation of plant and possession of appropriate certification as indicative tasks and points of entry. The classification descriptions in the Pharmaceutical Award are therefore sufficiently broad to enable the classification of the Electricians.

[7] In accordance with clause 4.8 of the Pharmaceutical Award, where an employee can be covered by more than one award, consideration must be given to the type of work performed and the environment in which the employee normally performs the work. As the employer is covered by the Pharmaceutical Award and the classification descriptions are sufficiently broad to encompass the role of an Electrician, it was submitted that it is the appropriate award for the coverage of these employees.

[8] Additionally, the employer submitted that clause 4.7 of the Pharmaceutical Award expressly states that the Pharmaceutical Award does not cover employers and employees who are covered by the Manufacturing Award. The employer submitted that it would not be considered to be an employer covered by the Manufacturing Award.

[9] Therefore, the Applicant submitted that the Electricians are appropriately covered by the Pharmaceutical Award.

Part-time Employees and Casual Employees

[10] The Commission raised concerns with the employer regarding overtime and weekend rates of pay for part-time and casual employees under the Agreement.

[11] The employer confirmed that it does not currently employ any casual or part-time employees and submitted that the concerns raised by the Commission are not relevant for the purposes of the Better Off Overall Test (BOOT) and should not act as an impediment to the approval of the Agreement

[12] The employer, however, noted the following:

•  The Agreement prescribes rates of pay that are on average 62.66% higher than the corresponding minimum Award rate of pay.

•  The Agreement’s rates of pay range from 21.18% to 142.46% above the corresponding minimum Award rate of pay. When the casual loading is applied to the Agreement rates of pay, this results in a significant benefit for casual employees.

•  The Agreement guarantees a part-time employee a minimum of 16 hours per week. The Award does not contain a similar guarantee.

•  Part-time employees have the opportunity under the Agreement to agree to work additional hours.

•  The Agreement prescribes the same overtime rates of pay (i.e. 150% for the first 2 hours and 200% thereafter, and 200% for Sundays). When applied to the Agreement rates of pay, this results in a significant benefit for employees.

[13] The employer also submitted that all employees are provided with an extensive range of benefits through the Agreement that are not conferred by the Award. The more beneficial entitlements include, but are not limited to:

•  Annual wage increases;

•  An additional superannuation contribution of 0.5%;

•  30% allowance paid on all night shifts;

•  Paid meal and rest breaks;

•  Annual leave loading of 20% or the relevant shift allowance;

•  3 days of compassionate leave;

•  Notice of termination and redundancy pay;

•  Entitlements to leave (e.g. Blood Donor Leave, Study Leave, Union Delegates Leave).

[14] When adopting a global assessment for the purpose of the BOOT, the employer submitted that payment at rates of pay significantly above the minimum Award rate, plus the other benefits afforded to part-time and casual employees covered by the Agreement, will ensure that any part-time and causal employees who may be engaged in the future will remain better off overall.

[15] The employer reiterated that it does not currently employ any part-time or casual employees. Therefore, there is no current requirement for a part-time or casual employee to work additional hours or weekends. If the employer was to engage part-time or casual employees in the future, it is unlikely that there would be a regular requirement for them to work ordinary hours on weekends. In the circumstances, the employer submitted that taking into account the other benefits available to part-time and casual employees under the Agreement that the BOOT is satisfied.

Less than 5 Afternoon or Night Shifts

[16] The Commission raised with the employer that the Agreement does not appear to confer the entitlement in clause 23.3(f)(ii) of the Award that an employee is paid an extra 50% for each shift where an employee works on an afternoon or night shift which does not continue for at least five successive afternoons or nights in a five day workshop or for at least six successive afternoons or nights in a six day workshop.

[17] The employer submitted in response that this absence of such an entitlement in the Agreement should not act as an impediment to the approval of the Agreement as employees remain better off overall for the purposes of the BOOT. This submission was made by the employer on the basis that the Agreement prescribes rates of pay that are on average 62.66% above the corresponding minimum Award rate. These significantly higher rates of pay that are applied for all purposes under the Agreement are sufficient to compensate for the absence of the 50% loading payable under the Award when less than 5 successive shifts are worked.

[18] The employer also noted that all employees who work a night shift under the Agreement are entitled to the payment of a 30% night shift allowance. In comparison, the standard night shift loading under the Award is 15%, with the 30% loading only paid when an employee is required to work:

•  during a period of engagement on shift, on night shift only; or

•  on night shift for a longer period than four consecutive weeks; or

•  on a night shift which does not rotate or alternate with another shift or with day work so as to give the employee at least one-third of their working time off night shift in each three shift cycle.

[19] The employer submitted that the combination of the higher rates of pay and night shift allowance prescribed in the Agreement, and all of the other more beneficial entitlements outlined in the employer’s Form F17, ensure that employees remain better off overall at all times for the purposes of the BOOT. Therefore, as the BOOT is satisfied, the employer submitted that no undertaking is required.

Shift Penalties

[20] The Commission raised with the employer that the Agreement appears to provide equal penalties for shiftworkers but restricts when the penalties are payable. For example, Night shift means a shift where 50% or more of the ordinary hours of work are performed between 10pm and 6am. Afternoon shift means a shift where 50% or more of the ordinary hours of work are performed between 4pm and midnight. The Commission noted that this will affect classifications with a lower wage rate percentage, if they didn’t receive the shift penalty when regularly rostered on for shifts that would normally attract penalties under the Award.

[21] The Applicant in response submitted that the shift allowances under the Agreement are equal to, or greater than, the Award despite the differing definitions for Afternoon and Night shifts.

[22] The Award defines an afternoon shift as meaning “any shift finishing after 6.00 pm and at or before midnight.” In comparison, the Agreement defines an afternoon shift as meaning “a shift where 50% or more of the ordinary hours of work are performed between 4 pm and midnight.”

[23] Currently, the Applicant’s normal afternoon shifts across the various roster patterns commence at 2:00pm and finish at either 10:00pm or 10:30pm. This shift would fall within the definition of an afternoon shift under both the Award and the Agreement and result in the payment of a 15% shift allowance.

[24] In relation to night shifts, the Award defines a night shift as meaning “any shift finishing after midnight and at or before 7.00 am.” Whereas, the Agreement defines a night shift as meaning “a shift where 50% or more of the ordinary hours of work are performed between 10pm and 6 am.”

[25] The employer submitted that its standard night shifts currently operate from 10:00pm and finish at either 6:00am or 6:30am, or for the purposes of the 24/7 roster, between the span of 5:45pm to 6:00am. These roster arrangements would therefore fall within the definition of a night shift under both the Agreement and the Award. On this basis, no detriment is suffered for the purposes of the BOOT. However, as highlighted above, as the Agreement prescribes significantly higher rates of pay and a 30% night shift allowance for the purposes of all night shifts, in comparison to the standard 15% night shift loading under the Award, shiftworkers remain better off overall under the provisions of the Agreement.

[26] Additionally, the employer noted that the Agreement prescribes a broader span of hours for both an afternoon shift and a night shift to fall within, and therefore has the potential to result in a more beneficial entitlement for an employee in comparison to the Award.

[27] On this basis, the employer submitted that despite the different shift definitions in the Agreement, employees remain better off overall under the terms of the Agreement and no undertaking is required.

[28] 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.

[29] The Australian Workers’ Union (AWU) being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) of the Act, I note that the Agreement covers the AWU.

[30] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 7 days from the date of approval. The nominal expiry date of the Agreement is 22 June 2022.

DEPUTY PRESIDENT

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