Ausco Martin Pty Ltd trading as The Westin Sydney

[2010] FWA 2701

Note: An appeal pursuant to s.604 (C2010/3819) was lodged against this decision - refer to Full Bench decision dated 9 September 2010 [[2010] FWAFB 6214] for result of appeal.

[2010] FWA 2701

FAIR WORK AUSTRALIA

DECISION

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

Ausco Martin Pty Ltd trading as The Westin Sydney
(AG2009/24760)

SENIOR DEPUTY PRESIDENT RICHARDS BRISBANE, 18 MAY 2010

Approval of The Westin Sydney Enterprise Agreement 2009 - flexible part time arrangements and relationship to reference instrument – reasonably predictable hours – retaining identity of part-time work - recording agreed variations to hours – compliance with undertakings.

[1] This is an application by Ausco Martin Pty Ltd trading as The Westin Sydney (“the Employer”) for approval of a single enterprise agreement known as the Westin Sydney Enterprise Agreement 2009 (“the Agreement”).

[2] The Liquor, Hospitality and Miscellaneous Union (“LHMU’) is a bargaining representative for the purposes of the Agreement under s.176 of the Fair Work Act 2009.

[3] Though the LHMU filed a Form F18 and by doing so provided a statutory declaration in support of the approval of the Agreement and appears also to have supported the request to approve the Agreement and signed the Agreement, it subsequently seeks to challenge the Agreement on grounds that it does not meet the No Disadvantage Test.

[4] The LHMU has not explained its actions in this regard, did not appear itself at the hearing of this application for approval of the Agreement, and did not provide instructions by way of explanation to its legal representative, who appeared on its behalf.

[5] There is little I can meaningfully add in explanation of the LHMU’s conduct or its responsibilities in relation to signing statutory declarations, and matters of compliance with statutory declarations reside elsewhere than Fair Work Australia (“FWA”). The LHMU has previously supported the approval of another agreement 1 on similar terms as that which is now before me.

[6] Be that as it may, the immediate task before me is to determine whether the Agreement meets the No Disadvantage Test (“NDT”).

[7] Schedule 7 Division 2 of the Fair Work (Transitional Provisions & Consequential Amendments) Act 2009, which applies to an agreement such as that before me (and which comprises an application made within the bridging period) states as follows:

“4 When does an agreement pass the no-disadvantage test?

(1) An enterprise agreement passes the no-disadvantage test if FWA is satisfied that the agreement does not, or would not result, on balance, in a reduction in the overall terms and conditions of employment of the employees who are covered by the agreement under any reference instrument relating to one or more of the employees.” [my emphasis]

[8] It is the common position that the relevant reference instrument is the Hospitality Industry – Accommodation, Hotels, Resorts and Gaming Award 1998 (“the Reference Instrument”).

THE LHMU’S SUBMISSIONS

[9] The LHMU’s principle complaints, if I can put it that way, concern the modifications in the part time arrangements within the Agreement as compared to theReference Instrument, and are largely summarised as follows:

• The definition of a part time employee in the Reference Instrument is an employee who works less than 38 hours a week and has reasonably predictable hours of work. 2



• Such an employee at the time of engagement must agree in writing on their regular part time pattern of work, and that agreement must specify the start and finishing times each day (though such agreement can be varied in writing). 3



• An employee who does not meet the definition of a part time employee under the Reference Instrument is entitled to the payment of the loading paid to a casual employee. 4



• A part time employee who works beyond their agreed hours of work must be paid at overtime rates for any such hours worked. 5



• The Agreement does not provide for part time employees to make a written agreement as to the pattern of work or the number of hours to be worked, or when those hours are to be worked and the start and finish times of the hours that are to be worked.



• Part time employees do know that they will work at least 48 hours and not more than 148 hours in any four week cycle and there will be rosters provided on a fortnightly basis with five days notice of the roster commencing.



• Part time employees engaged on such terms are not part time employees for the purposes of the Award and should be paid the 25% loading and overtime arrangements for hours when they work beyond their fixed hours.



• Flexible part time employees under the Agreement are only guaranteed to work no less than eight hours each week and no more than 36 hours in any one week and they work on a seven day roster provided to the employees seven days in advance (but which can be changed to meet operational requirements). 6



• There is “no guaranteed specific quantum for scheduling these hours” (as the LHMU put it).



• Flexible part time employees for the same reasons as part time employees fail to meet the definition of part time employees under the Award and do not attract the overtime and loading that are the entitlements of a part time employee whose work patterns and other arrangements depart from the Award definition of a part time employee.

THE EMPLOYER’S SUBMISSIONS

[10] The Employer (represented by the National Retail Association) contended, in the main as follows:

• The provisions which are before me now and that relate to part time arrangements have been features of prior agreements certified and\or approved in 2001, 2003 and 2006. That is, the part time arrangements are embedded in the work organisation of the Employer.



• The flexible part time arrangements are of “restricted application” and facilitate an arrangement whereby employees may be transferred from one Starwood hotel in Sydney to another in order to meet unexpected demand. The difficulty of matching labour with demand arises from the increasingly short term nature of bookings in the hospitality industry and customers exploit on-line ‘spot’ booking system. The framework within which the Agreement was negotiated 7 appears identify this as a critical issue the Agreement is designed to resolve.



• The Agreement provides for a $22.00 per week increase in wages (above the rate of the Reference Instrument) backdated to 1 October 2009 (pro rated for part time employees), though this amount is a rolled up amount and is intended partly to offset the lost of weekend penalty rates such as 7.00am – 7.00pm late work rate, the 25% Saturday penalty and 75% Sunday penalty (which are themselves further offset by the totality of the remuneration structure and other conditions).



• The Agreement provides for wage increases of $22.00 per week at each anniversary of the Agreement (from October to October).



• The Agreement provides for re-classification of room attendants and uniform room attendants, who are to move from commencement of their employment from Level 1 to Level 1A. This will lead to a financial benefit of approximately $20.00 per week.



• Employees employed as porters at commencement will be at Level 1A and not Level 1, and that after six months service such porters will commence to Level 2 of the classification structure.



• Allowances under the Agreement are increased and flexible part time employees receive an additional 5% for the hours worked under those extended arrangements. Appendix 1 Schedule 4 contains the Flexible Part-Time hours Rates of Pay and notes:




“The hourly rates of pay contained in this Schedule are based on an employee’s ordinary hourly rate of pay plus 5%.”

• The Agreement also introduces a new allowance of $1.25 each ordinary hour to apply to all hours worked between 12.00am and 5.00am. A five night shift worked across such hours would provide $31.05 per week for a relevant employee.



• There is a cap to the number of consecutive such shifts an employee will be required to work in this regard. The Reference Instrument affords no such protection.



• Part time hours are capped at 148 hours per four week cycle or 36 hours each week (subject to averaging). The Reference Instrument provides for a ceiling of 38 hours per week.



• The Reference Instrument does not provide for a minimum number of hours, but the Agreement provides for 48 hours over a four week cycle, or 12 hours each week, subject to averaging.



• The concept of “reasonably predictable hours” does not have a defined meaning in the Reference Instrument and it does not connote certainty or fixity as such, but allows for some measure of imprecision and flexibility. Nor, the National Retail Association contended, is the notion of altering hours by agreement precluded in the Reference Instrument. Hence the alterations to the part time arrangements claimed by the LHMU are not of great substance in their practical effect.



• Where there is a necessity to extend the hours of work, the Employer will seek volunteers at first instance, before selecting any employees (having taken into account the needs of employees).



• The Employer undertakes to provide as much notice as possible (and no less than one hour) in the event of changes to rosters (clause 15.5.7) and to give part time employees as accurate a forecast as possible of the number of hours worked each day.



• Broken periods of work are not a feature of the Agreement, whilst this is not the case under the Reference Instrument.



• Clause 15.5.5 of the Agreement encourages employees to participate in the construction of rosters so as to identify their preferences for hours or work.



• Clause 15.5.11 of the Agreement states that “[w]here practicable rosters will be arranged so that employees have consecutive days off rather than single days”, which is an undertaking not provided for in the Reference Instrument.



• Overtime (other than in banqueting) is payable outside of 10 hours of work. Clause 16.2.1 of the Agreement provides generally (in the context of Schedule 2 of the Agreement) that all time worked in excess of ordinary hours will be paid at overtime rates.

CONSIDERATION

[11] I have found the LHMU’s submissions of considerable assistance on this occasion in so far as it focuses on upon the circumstances of the flexible part time employees, in particular.

[12] I doubt that in the context of the material before me in relation to this application that FWA could be satisfied that the NDT had been met where a class of employees - flexible part timers - were required (pursuant to clause 15.6.5 of the Agreement) to work additional rostered hours possibly at short notice, compared with the entitlement at clause 15.3.4 of the Reference Instrument, which reads:

“Any agreed variation to the regular pattern of work will be recorded in writing.”

[13] The Agreement does away with the condition of mutuality in respect of how the otherwise regular pattern of work will be varied.

[14] A flexible part time employee may be required to work regularly an indeterminate number of hours in a roster cycle at short notice (of no more than one hour) up the cap of 36 hours. The salary increases and the additional 5% for the hours worked (along with the other benefits set out in the Agreement including the compounding effect of the loaded hourly rates as they are) would serve to offset all such hours worked (which would have been overtime hours under the Reference Instrument by virtue of clause 15.3.7 thereof).

[15] However, there remains a concern in relation to the loss of reasonable predictability of start and finish times, when hours will be worked and the loss of mutual consent for further hours to be worked or variation to the rostered hours.

[16] It appears to me that an employee would lose their capacity to possess reasonably predictability of the hours they would work if they lost their capacity to elect to work those hours. This is why under the Reference Instrument reasonable predictability of hours co-exists with consensual arrangements for the variation of otherwise fixed hours. That is, the notion of reasonable predictability appears predicated on the scope of an employee to elect to vary these hours (so the hours remain predictable to the employee).

[17] In my view, in order to meet the NDT, and to retain a sufficient identity as a part time employee, an undertaking would be required to the effect that the Employer would not require or direct any employee (under clause 15.6.5 of the Agreement) to work hours additional to the hours as rostered and be paid at ordinary hourly rates.  Such additional hours could only be worked at the election of the flexible part-time employee, or where that employee volunteers to work those additional hours.

[18] Of course, the overtime provisions as set out in the Agreement would otherwise continue to apply to part time monthly or weekly rostered employees (with the effect that an agreement to work additional hours within a weekly roster would result in those agreed additional hours being paid at ordinary rates up to 36 hours for a flexible part time employees, and 148 hours for a part time employee on a monthly roster).

[19] Clause 15.6.2 of the Agreement provides that in rostering the Employer would provide as accurate a forecast as possible about the actual number of hours to be worked each day. When taken in hand with the above mentioned undertaking, this clause provides a degree of personal certainty for an employee as to the hours to be worked than would other have been the case. Such hours as rostered in advance would be the hours to be worked over the roster cycle, other than where the flexible part-time employee agrees to work alternative hours. An arrangement like this would be sufficient, in my view, to retain the essential character of part-time work for flexible part time employees, and sufficiently distinguish it from casual employment (beyond the pro rata relationship to permanent full time employment).

[20] I acknowledge that such a constraint on the manner in which a flexible part time employee might be deployed might well undermine the operational benefits of engaging such employees. But I do note that such employees would still be able to be deployed at multiple locations owned and operated by the Employer, and afford greater shift and hours flexibility than part-time employees as such.

[21] It further appears to me that any additional hours that are worked voluntarily within a roster upon request of the Employer must be recorded in writing, along with the expression of consent to work those hours. This would provide a reasonable offset for the entitlement under clause 15.3.4 of the Reference Instrument and would ensure effective compliance (in relation to where an employee volunteered to work voluntary additional hours at ordinary time rates of pay or whether that employee was directed to perform those hours and attracted overtime payments).

[22] I would anticipate the Employer providing an undertaking of this nature as well.

[23] Of course, though I have recommended the above undertakings, the Employer may wish to propose alternative undertakings to address the issues raised above. I am amenable to considering any such alternate undertaking(s).

[24] I should indicate that one other issue in relation to undertakings has already been disposed of. That concerned a deficiency in relation to the flexibility arrangements in the Agreement. Following correspondence in relation to this matter, the Employer, on 19 April 2010, provided the following undertaking to FWA:

“Ausco Martin Pty Ltd, being the employer named in […] The Westin Sydney Enterprise Agreement 2009, hereby undertakes pursuant to section 190 of the Fair Work Act 2009 (‘the Act’) that, upon the approval of the said agreement by Fair Work Australia, and at all times thereafter whilst the said Agreement is in force and effect, the employer will ensure any flexibility arrangement entered into with an employee in accordance with clause 35 of the enterprise agreement:

• is not conditional upon approval or consent of a third party (other than parent or guardian in the case of those employees under 18 years of age in accordance with s.203(5) of the Act; and

• can be terminated as per s.203(6) of the Act; and

• will be given to the employee within 14 days in accordance with s.203(7)(b) of the Act.

This undertaking is given in the full knowledge and understanding that the terms of the undertaking shall be taken to be a term of the Agreement if Fair Work Australia accepts this undertaking and approves the Agreement.”

[25] The bargaining representative was given an opportunity to indicate its support or objection to this undertaking. FWA has not received a response from the LHMU in this regard, nor did the LHMU’s representative raise any issues concerning the undertaking at the hearing. I note the LHMU has had approximately 2 months to notify FWA of any concerns. In light of this, I accept that the requirements of s.190(4) of the Act have been satisfied in respect of this undertaking.

[26] I note the LHMU seeks to be covered by this Agreement and has filed a Form F22. In accordance with s.201(2) of the Act, should I approve the Agreement, any such approval decision will note that the Agreement covers the LHMU.

[27] On the basis of my decision above and if the Employer provides the requisite undertakings, or suitable alternative undertakings, a decision approving the Agreement will issue.

SENIOR DEPUTY PRESIDENT

Appearances:

Mr G Black of the National Retail Association for the Applicant

Mr C Massy of Hall Payne Lawyers for the Respondent

Hearing details:

Brisbane.

2010:

March, 18.

 1   See my decision in [2009] FWAA 1130 in relation to the Application by Ascents Hotel Pty Ltd T/A The Westin Melbourne (AG2009/18226)

 2   Clause 15.3.2 of the Reference Instrument

 3   Clauses 15.3.3 and 15.3.4 of the Reference Instrument

 4   Clauses 15.3.6 and 15.2 of the Reference Instrument

 5   Clause 15.3.7 of the Reference Instrument

 6   Clause 15.6 of the Agreement

 7   See clause 15.1 and 15.6.1 of the Agreement

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