Australian Glass Group (Holdings) Pty Ltd

[2020] FWC 2988

[2020] FWC 2988

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.217 - Application to vary an agreement to remove an ambiguity or uncertainty

Australian Glass Group (Holdings) Pty Ltd
(AG2020/1183)

Building, metal and civil construction industries
COMMISSIONER MCKINNON	MELBOURNE, 9 JUNE 2020

Application to remove ambiguity or uncertainty in relation to skills matrix – no relevant ambiguity or uncertainty – application dismissed.

[1] On 31 January 2020, the Commission approved the Australian Glass Group (Holdings) Pty Ltd (Victoria Branch) and CFMMEU (Manufacturing Branch) Enterprise Agreement -- 2019-2022. The Agreement covers Australian Glass Group (Holdings) Pty Ltd, the Construction, Forestry, Maritime, Mining and Energy Union and employees “who are employed to perform work described in the skill matrix in Schedule 1A currently, and as amended in accordance with clause”, other than salaried employees. The reference to “clause” is plainly a reference to clause 19 of the Agreement.

[2] Clause 19 commits the parties to reviewing and implementing a refreshed skills matrix. The matrix is to be finalised within 3 months of the application for approval of the Agreement on 31 December 2019 “to the point that an assessment of all employees covered by the Agreement may be undertaken to determine their appropriate classification level of the Matrix.” Once a new skills matrix is agreed, the parties are to apply to vary the Agreement to substitute the new skills matrix with the version contained in Schedule 1A of the Agreement. The parties have separately agreed that they can seek to vary the Agreement during its term (clause 3(d)), consistent with the Full Federal Court’s decision in Toyota Motor Corporation Australia Limited v Marmara 1.

[3] Clause 19 deals with the classification structure and skills matrix as well as the process for refreshing and replacing that matrix. Its specific terms are as follows:

“(a) All employees working under this Agreement shall be classified according to the classification structure (Skills Matrix) set out in the Schedule IA.

(b) The parties to this Agreement are committed to reviewing and implementing a refreshed skills matrix reflective of the skills required today to undertake the work required to be performed on the processes, plant and equipment being used within the operation. The skills matrix also provides a recognisable vehicle to promote upskilling and progression through the levels of the skills matrix.

(c) It is agreed that within 3 months of the Agreement having been filed in the Fair Work Commission seeking approval of the Agreement, the Skills Matrix will be finalised to the point that an assessment of all employees covered by the Agreement may be undertaken to determine their appropriate classification level of the Matrix.

(d) The parties agree that once the new skills matrix has been finalised and agreed to by the parties, a variation to the Agreement as provided at clause 3 (d) will be made to the FWC seeking to vary (remove) the existing classification structure and insert the new skills matrix

(e) Consistent with point 19.1(c) above the company commits to conduct an assessment of all employees within 9 months of the Agreement having been filed in the Fair Work Commission seeking approval of the Agreement.

(f) Where an employee is determined to be performing work at a higher classification than the one the employee is on at the time of the assessment and as assessed as competent for that classification and as performing work at that classification, the employee will be re-classified accordingly and the appropriate rate for the classification will be applied from the date of confirmation of the higher classification.

(g) Where an employee is being paid at a higher rate that for the work being undertaken by the employee as assessed under the new skills matrix, the employee will not suffer a reduction in their current pay rate, but will be required to up-skill over a period of time to meet the requirements of the classification that they are being paid at.”

[4] Australian Glass Group (Holdings) has applied to vary the Agreement in accordance with clause 19. The application is supported by the Union and gives effect to the parties’ agreement on a process to update the skills matrix. The difficulty is that the application is made under section 217 of the Act, which deals with removing ambiguity or uncertainty from enterprise agreements. Here, there is no relevant ambiguity or uncertainty in the terms of the Agreement. There are no rival contentions about their meaning. Its terms are clear and they are consistent with the agreement made between the parties.

[5] Australian Glass Group (Holdings) points to clause 19(e) of the Agreement as evidencing the relevant ambiguity or uncertainty required to establish jurisdiction to vary the Agreement. However, the terms of clause 19(e) are neither ambiguous nor uncertain. They require an assessment of all employees covered by the Agreement to be undertaken to determine their appropriate classification level under the new skills matrix within 9 months of 31 December 2019, when the application for approval was made. That can be done, whether the Agreement has been varied to incorporate the skills matrix by that time or not. It may mean that formal reclassification does not take effect until a later time, but it does not mean that the terms of the Agreement are unclear.

[6] Both parties submit that the Agreement is ambiguous or uncertain because it creates the potential for future ambiguity or uncertainty about which matrix applies at which point in time if the new skills matrix does not become an enforceable term of the Agreement. They wish to avoid future disputes over classification-related matters by doing what they have agreed to do, which is to ensure that the new skills matrix becomes a term of the Agreement.

[7] These are worthy concerns and ones that are to be addressed as agreed under clause 19, but under the appropriate statutory mechanism. Potential ambiguity or uncertainty about the future operation of clear agreement terms is not the same as ambiguity or uncertainty in the terms of the agreement itself. Were I to grant the application, it would be beyond jurisdiction and not enforceable because the application is not within scope of section 217.

[8] The Act separately provides for variation of agreements by consent. 2 Important to the process is the opportunity for employees to have their say on any proposed variation by way of vote. While the variation in this case has been agreed, it has been made by the company and seven delegates of the Union, representing 70-80% of employees covered by the Agreement. That means there are 20-30% of employees who have not participated or been represented in discussions over the proposed variation and have not had the opportunity to have their say.

[9] The appropriate course is for a separate application to be made to the Commission under section 210 of the Act once the necessary procedural steps in relation to an enterprise agreement variation have been followed.

[10] The application is dismissed.

COMMISSIONER

Appearances:

S Bisshopp for the Applicant.
C Larkins for the Construction, Forestry, Maritime, Mining and Energy Union

Hearing details:

2020.
Melbourne (by telephone):
June 4.

Printed by authority of the Commonwealth Government Printer

<AE506915  PR720007>

 1 [2014] FCAFC 84

 2   See Fair Work Act 2009, ss 207-216.