Australian Rail, Tram and Bus Industry Union - New South Wales Branch - [2025] FWC 2813

[2025] FWC 2813

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.768BG - Application to consolidate orders in relation to non-transferring employees

Australian Rail, Tram and Bus Industry Union - New South Wales Branch

(AG2024/4397)

DEPUTY PRESIDENT SLEVIN

SYDNEY, 22 SEPTEMBER 2025

Application under s. 768BG(1) for consolidation orders in relation to non-transferring employees - Privatisation of bus services – consideration of factors in s. 768BG(4) – order opposed - employee support - productivity impacts uncertain - public interest factors favour orders – Orders made.

The Application

On 9 January 2022 Busways North West Pty Ltd (Busways) took over passenger bus services for Transport for NSW (TfNSW) under a contract described as Metropolitan Bus Contract Region 7 (the Contract). Busways is a national system employer for the purposes of the Fair Work Act 2009 (the Act). Prior to Busways providing those services, they were provided by the State Transit Authority of NSW (STA). The STA is a State public sector employer. The employees who worked for STA were covered by an award of the NSW Industrial Relations Commission, the State Transit Authority Bus Operations Enterprise (State) Award 2021 (the NSW Award).

Part 6-3A of the Act regulates the ‘transfer of business’ from a State public sector employer to a national system employer. It provides that, upon a transfer of business, terms and conditions of employment applying to employees who transfer to a national system employer will transfer with them. The mechanism by which this is achieved is the creation of a new instrument enforceable under the Act, in this case a copied state award, which incorporates the terms of the State award which previously applied to the transferring employees. In the current circumstances a copied State award incorporating the terms of the NSW Award (CSA) came into existence on 9 January 2022 and applied to any employee of STA who transferred to Busways and continued to drive buses.

The CSA only applies to the employees who transferred from STA (STA employees). It does not operate in respect of other employees of Busways including employees employed since the transfer. The employees not covered by the CSA are referred to as non-transferring employees.

Under s 768BG of the FW Act, the Commission may make an order which has the effect that a copied State award that applies to transferring employees of the relevant national system employer also operates in respect to non-transferring employees of the same employer. The non-transferring employees must be doing the same work as the transferring employees.

Busways has non-transferring employees doing the same work as the transferring employees. Those employees are currently covered by an enterprise agreement the Busways Driver/Mentor Enterprise Agreement 2021 (Driver/Mentor Agreement).

The Australian Rail, Tram and Bus Industry Union (RTBU) makes application under s. 768BG for a consolidation order that the CSA cover and apply to the non-transferring employees. Busways opposes the application.

For the reasons that follow I have decided to make the order.

Background

I was provided with a substantial amount of material in the proceedings, in total over 6,000 pages, comprising witness statements with annexures including industrial instruments, detailed bid documents, commercial contracts, and financial documents. It is not possible to set out all of that material here. I have had particular regard to the documents I was referred to by the parties in submissions, the key documents referred to in the witness statements, and the documents referred to in cross examination. Consent orders were made protecting confidential information in the contract and financial documents. I have avoided making direct references to the material that the parties agreed was confidential.

The material provided a history of the privatisation and the operational and financial impact on Busways and its employees. It detailed the challenges arising from the two groups of employees working side by side under different arrangements, attempts to negotiate an agreement to cover all employees, and the steps taken by Busways to manage the business under the two industrial instruments. Those steps included a new roster system introduced in March 2025 which effectively rostered employees in a way which separated the transferring and non-transferring employees.

Union Evidence

The RTBU led evidence from Mr David Babineau, the State Secretary of the RTBU Bus Division in New South Wales and a former bus driver and from 9 bus drivers working for Busways in Region 7.

Mr Babineau provided two statements and was cross examined. He described the history of the dealings between the union and Busways. Busways won the tender for the Region 7 bus services in July 2021, with operations commencing in January 2022. Prior to that, in December 2020, the Commission approved Busways, Transport Workers’ Union of Australia and Drivers Enterprise Agreement 2020 (Greenfields Agreement) that was intended to apply to non-transferring employees[1]. The agreement was said to pertain to a genuine new enterprise that Busways was establishing or proposed to establish, namely, public transport operations for which Busways had submitted tenders to the New South Wales government. The Union had concerns about the Greenfields Agreement as it offered inferior terms compared to the NSW Award and would create a two-tiered workforce. The Union unsuccessfully appealed the approval of the Greenfields Agreement in the Commission[2] and then sought judicial review in the Federal Court. The approval of the Greenfields Agreement was ultimately overturned by the Court in April 2022[3].

While challenging the Greenfields Agreement, the RTBU was also involved in discussions with Busways about issues related to the transfer of Region 7 services. While those discussions were taking place the Driver/Mentor Agreement was approved. The Agreement was made in September 2021. It was approved on 14 October 2021. Busways did not disclose the existence of the Driver/Mentor Agreement during discussions with the RTBU. The RTBU was not made aware of it until 5 November 2021, which was after it was approved. When made, the Driver/Mentor Agreement applied to a limited group of employees. It was expressed to cover employees who were not covered by the Greenfields Agreement. Mr Babineau described it as a backup to the Greenfields Agreement. At the time the Union had been negotiating a single enterprise agreement with common conditions for all employees in Region 7. Once it became aware of the Driver/Mentor Agreement, it withdrew from those negotiations.

When Busways commenced providing the bus services in January 2022 the CSA applied to transferring employees and the Greenfields Agreement applied to non-transferring employees. From April 2022, following the Federal Court orders that quashed the decision approving the Greenfields Agreement, the Driver/Mentor Agreement applied to non-transferring employees. The parties recommenced negotiations towards a single agreement in 2023 and engaged a private mediator to assist. In 2024 the parties attended conciliation in the Commission. The RTBU also sought and was granted a protected action ballot order. Mr Babineau said that throughout the negotiations the union sought to address disparities in pay, leave entitlements, and working conditions between the existing instruments. Mr Babineau explained the union’s aim was to achieve a single set of conditions for all workers in Region 7, addressing issues such as pay, leave, and roster structures. By November 2024 it was clear that agreement could not be reached, and the current application was made. Busways agreed that bargaining was futile.

Mr Babineau described the main differences between the CSA and the Driver/Mentor Agreement as follows:

51. There are significant differences between the State Award and the Agreement. For example:

a. no Standing Time provision for employees covered by the 2021 Agreement. Standing Time is a rostered break after certain trips of 8 minutes in non-peak periods and 6 minutes in peak periods. The Union considers this provision to be crucial to ensuring drivers are able to safely do their jobs;

b. better penalty regimens in the State Award - there is no single instance where the penalty regimen provided by the 2021 Agreement is more favourable;

c. the State Award provides shift parameters that enable drivers to better manage their fatigue (compared to the 2021 Agreement);

d. the State Award has far better overtime rates and provisions for drivers which is crucial given that the typical base rate for a bus driver is around $65,000 a year;

e. the State Award provides for five weeks annual leave for almost all employees, whereas the 2021 Agreement provides only 4 weeks of annual leave;

f. the State Award provides for increasing amounts of sick leave relative to the employee’s length of service (for example, 8 days per year for 0-5 years’ service, 12 days per year for 5-7 years of service, and 15 days per year for over 7 years of service), whereas, the 2021 Agreement provides only 10 days person
leave.

In March 2025 Busways introduced new rosters which divided the employees according to whether they were covered by the CSA or the Driver/Mentor Agreement. This resulted in many CSA employees being displaced. The displaced drivers were those who were removed from a roster that provided predictable and cyclical work. Mr Babineau said many of the drivers who have been displaced had been on the same roster for decades and had planned their financial obligations around the income they received on their roster. The change was said to not just result in a loss of income but also a loss of predictability of their day. He claimed that approximately 180 STA drivers (34%) were displaced due to roster changes, while non-transferred drivers were unaffected. He criticised the March 2025 roster changes for disproportionately impacting STA drivers and reducing the number of high-value shifts. He raised concerns about shift allocation mechanisms favouring non-transferred employees, who are paid less, including rail replacement shifts and Sunday work.

Mr Babineau referred to commitments from TfNSW prior to privatisation that a two-tier workforce would be avoided. He also referred to attempts to ensure that TfNSW would provide funding to Busways if a consolidation order was made that would adversely impact on its viability.

TfNSW were invited to participate in the proceedings but declined.

Mr Babineau described the RTBU’s aim to establish a single enterprise agreement for all workers, based on CSA conditions. He noted that protected industrial action was available to advance the RTBU’s claims for a replacement agreement and acknowledged the nature of the bus service provided by Busways was a public service and that there were concerns that such action would adversely impact the public. He provided a history of the negotiations. That history demonstrates that the existence of two sets of wages and conditions is hampering the conclusion of an agreement. Nonetheless, Mr Babineau described his members at Busways as committed to achieving a fair agreement and being willing to undertake industrial action to advance claims against Busways and the government in support of fair conditions despite hostile public or government opinion.

Allan Nickoll, a union delegate who has worked as a bus driver for 23 years outlined the union's objections to the new roster system introduced in March 2025 which took advantage of flexibilities in the Driver/Mentor Agreement. He highlighted the superior conditions under the CSA and argued that the two-tier system created by having two industrial instruments covering the same work was causing division in the workforce. Mr Nickoll said the while the Driver/Mentor Agreement had higher hourly rates of pay that did not mean the non-transferring employees were paid more. He pointed to the better penalty rates and allowances in the STA Award which result in higher take home pay for CSA workers. Mr Nickoll was cross examined. He described dissatisfaction caused by the recent roster changes and industrial arrangements which have split the workforce. He criticised inequities in shift allocation, which now favours Driver/Mentor employees, and expressed concerns about fatigue for drivers. He described how displaced STA drivers lost predictable roster lines and were relegated to piecemeal shifts or relief work. He said that the new system created inequities and negatively impacted morale within the depot. He acknowledged that the consolidation order would only apply for 18 months as the CSA will expire in January 2027 but hoped that the order would assist in reaching a single enterprise agreement for all employees before then. Mr Nikoll also discussed the challenges faced by displaced drivers, including the lack of certainty in work allocation and the impact on financial stability.

Mr Nickoll and other drivers provided a petition which was signed by a majority of non-transferring employees. The petition related to the current proceedings and by signing it the employees were indicating their support for a consolidation order. The petition was discussed during the cross-examination of Mr Nikoll. He said that he collected signatures for the petition and explained its contents to some people verbally while for others he read the script provided. He stated that the script explained that if the RTBU consolidation order was made, the Driver/Mentor employees conditions would be brought up to the CSA. He confirmed that the script did not mention that the CSA would only apply for a period of 18 months. He also stated that he did not inform the signatories about this 18-month limitation, as it was not part of the script.

Donald Darling, also a RTBU delegate and a transferring employee provided two statements and was cross examined. Mr Darling expressed concerns about the new roster system which displaced senior drivers and disrupted work-life balance. He highlighted the superior conditions under the CSA compared to the Driver/Mentor Agreement, including pay rates, penalties, and entitlements. He was concerned that the changes to rosters in March 2025 will lead to fatigue and uncertainty for transferring employees. In his reply statement Mr Darling disputed claims by Busways that downplayed the difference between the salaries paid to STA employees and Driver Mentor employees, estimating the annual pay differences as $6,000–$9,000. He also challenged assumptions made by Busways about STA employee attrition rates and criticised the March 2025 roster changes for unfair overtime allocation and unsafe shift lengths.

Mr Darling expressed frustration about being displaced from his previous roster or line and being placed on the midday displaced line, which was not his preferred roster and disrupted his lifestyle. He criticised the new two-tier roster system, which he felt disadvantaged STA drivers compared to Driver/Mentor drivers by adversely impacting their financial and personal circumstances. He was asked about his estimate that STA drivers were financially disadvantaged. He explained that the differences arose from less beneficial shift penalties under the Driver/Mentor Agreement compared to the CSA, particularly for broken and night shifts. He accepted that his calculations were rough and lacked detailed modelling. He acknowledged the complexity of the exercise but maintained confidence in the figures based on his experience as an RTBU delegate and long-term bus driver.

Mr Darling spoke about the need for a single agreement for all drivers with conditions based on the CSA. He considered the certainty of all employees being on CSA as a basis for negotiations would assist in bargaining and reduce the potential for industrial action.

When asked about the need for Busways to achieve cost savings under the contract with TfNSW by reducing drivers' wages and conditions, he referred to a press release from around the time of the privatisation that mentioned taxpayer savings of $75 million over eight years. Mr Darling agreed that if the current application was successful, it would provide the union with more leverage in bargaining to secure better terms and conditions for its members.

Michael Keith Unicomb is another transferring employee. He provided two statements and was cross examined. His evidence raised the challenges posed by the new roster system, including longer shifts, reduced pay, and displacement of transferring drivers. He highlighted the superior conditions under the CSA. Mr Unicomb is on a roster committee which reviews compliance with the award and agreement requirements. The committee checks proposed roster changes to ensure they do not reduce wages by more than 2%. Reviews are triggered by significant changes to the roster or service changes. The committee includes representatives from various workgroups and a union representative. Mr Unicomb expressed concern over the displacement of transferring employees and the implications for their future employment. He said the split roster system disadvantages transferring employees, limiting their access to work. He is concerned many STA employees may end up on standby, significantly reducing their earnings.

Mr Unicomb explained that the roster includes five workgroup lines; AM, broken, day, midday, and PM. He has primarily worked the midday line for 32 of the last 37 years. In his statement which was prepared before the roster changes commenced, he estimated that the roster changes effective from 3 March 2025 would affect approximately 46 transferring drivers who would be displaced due to the removal of lines from the STA Roster. In his oral evidence, after the roster changes took effect, he stated that 125 CSA employees and 24 Driver/Mentor EA employees had been displaced, with STA drivers making up 84% of the displaced group. He was shown shift allocation data based on the changes and agreed that Driver/Mentor employees were receiving a fair share of shifts relative to their workforce percentage. Mr Unicomb was not one of the drivers displaced but fears he may be if further changes occur. He estimates he could lose an average of $250 per week if displaced.

Eren Comertpay, also a transferring employee, gave evidence similar to the other drivers. He criticised the new roster system for displacing STA Award drivers and reducing their pay. He highlighted the inequality between transferring and non-transferring drivers and raised concerns about fatigue, reduced income, and the impact on work-life balance. During his cross examination he acknowledged that if the order was made the CSA would only run until January 2027 but believed that it would assist by providing a basis for negotiating a replacement agreement by returning the industrial arrangements to a single set of terms and conditions while that agreement was negotiated.

Alex Streeter, a transferring employee, raised concerns about the impact of the new roster system on fatigue and safety. He criticised the disparity between transferring STA drivers and new drivers under different agreements, advocating for "one team" and one award to improve morale, cohesion, and equity. He criticised the Driver/Mentor Agreement for its inferior conditions and supports the union's application to extend the CSA to all drivers to improve workplace culture and ensure fairness. Mr Streeter described the impact of the March 2025 roster changes, which led to STA drivers losing access to high-value shifts, being displaced, and sitting in depots without allocated shifts unless relief work became available. He raised concerns about inequities in shift allocation mechanisms that prioritized lower-paid, non-transferred employees over STA drivers. He expressed concerns about longer working hours under the new roster, which could lead to fatigue, increased stress, and potential accidents involving the public. He supported the RTBU's efforts to unify the workforce under one award and establish a single enterprise agreement with CSA-like conditions to address pay and condition disparities. He also confirmed union members' commitment to industrial action to achieve equitable outcomes.

Ian O’Connor is a delegate of the RTBU and a transferring employee. He has worked from the Ryde Depot, which is in Region 7, as a bus driver since 2009. He estimated that of the 465 drivers in Region 7, 148 were covered by the Driver/Mentor agreement and 317 were covered by the CSA. He said the transferring drivers on the CSA enjoy better conditions, including five weeks of annual leave compared to four for Driver/Mentor drivers, additional days off, and better penalties. He estimated STA drivers earn between $4,000 to $8,000 more annually than Driver/Mentor drivers due to better penalties, allowances, and pay rates. He also raised the negative impact of the new roster system on transferring employees, including displacement and reduced pay. He estimated the STA drivers lost approximately 132 lines of work, leading to many being displaced and placed on relief shifts. He said Driver/Mentor drivers are now working longer hours and do not rotate their lines of work, leading to unequal pay distribution. Mr O'Connor was placed on what he describes as scrap shifts, making his work hours unpredictable and will result in a decrease in earnings.

Mr O’Connor was involved in collecting signatures for the petition. He stated that he explained to drivers that if the RTBU's claim succeeded, the Driver/Mentor employees would move onto the CSA conditions. He said that he did not inform drivers that the CSA would only apply until January 2027.

John Cincotta started at Busways in August 2023 and is a non-transferring employee. His employment is covered by the Driver/Mentor Agreement. He raised concerns about the new roster system which has reduced his access to overtime and led to a reduction in take home pay which he anticipated would be $500.00 per week. He also referred to the advantages in the CSA over the Mentor Driver Agreement including higher penalty rates and more generous overtime provisions. Mr Cincotta raised concerns about the new rosters giving rise to safety concerns around fatigue management especially arising from shorter meal breaks.

Scott Bell, a transferring employee, has been employed since April 2018. He referred to the challenges posed by the new roster system, including longer shifts and reduced pay. He emphasised the superior conditions under the NSW Award. Mr Bell raised the same concerns as other drivers about the disparities between the NSW Award and Driver/Mentor Agreement. He also expressed similar concerns about the workforce being split by the introduction of the new roster which resulted in a reduction of pay for transferring drivers. Mr Bell provided an email from Mr Rob Gibson, Busway’s Workplace Relations Manager, sent in February 2025 which acknowledged that the roster changes would affect some groups more than others. Mr Bell provided a list of the drivers who were displaced by the roster changes. The list included the names of 55 drivers. Of those, 14 are identified as non-transferring employees the other 41 are transferring employees.

Mr Bell was also involved in collecting signatures for the petition. He confirmed that he explained to drivers that if the RTBU's claim succeeded, the Driver/Mentor employees would become covered by the CSA. He acknowledged that he did not inform drivers that the CSA would only apply until January 2027.

Busways evidence

Busways provided witness statements from Robert Gibson, Workplace Relations Manager, Mr Danial Gibson Head of Scheduling, and William O’Neill, CEO of Busways Group.

Mr Robert Gibson’s evidence went to the industrial relations and enterprise agreements related to Busways Group's operations. He said approximately 860 employees were bus drivers in Region 7 at the time of transition. The tender for the work was based on assumptions that the existing STA employees would be covered by the CSA for five years and new drivers would be employed under the Greenfields Agreement. The Greenfields Agreement was negotiated with the Transport Workers Union (TWU) prior to the formal tender process. Negotiations began on 21 July 2020. Busways took the view that the RTBU did not have coverage for new drivers in Region 7. The Greenfields Agreement was approved on 9 September 2020 but was later quashed by the Federal Court on 7 April 2022. Busways negotiated the Driver/Mentor Agreement to cover new drivers while the legal challenges to the Greenfields Agreement were ongoing. The Driver/Mentor Agreement was approved on 14 October 2021.

Bargaining for a new enterprise agreement to cover all workers began after it was clear the RTBU had coverage of all Region 7 drivers. After the RTBU expressed a desire to negotiate a single enterprise agreement, notices of employee representational rights were issued on 16 February 2022. Bargaining meetings were held between Busways and the RTBU from April 2022 to April 2023. The negotiations were paused and later resumed in August 2023. The first round of negotiations focused on achieving a single enterprise agreement within financial constraints. Busways offered to retain the core entitlements from the CSA. The second round of negotiations involved significant revisions to the proposed enterprise agreement.

The RTBU filed for a protected action ballot order (PABO) on 21 August 2023. Busways raised legal concerns with the PABO contending the RTBU could not lawfully apply for the PABO due to the nature of ongoing negotiations. Negotiations continued with the involvement of the NSW State Government and a mediator. The government encouraged both parties to reach agreement. Busways filed a bargaining dispute under section 240 of the FW Act in March 2024. That dispute was the subject of conferences before the Commission, but agreement was not reached.

Mr Gibson said that approximately 38% of the workforce is covered by the Driver/Mentor Agreement, while 62% are under the CSA. He said that on 11 March 2025, Driver/Mentor Agreement employees earned $0.9494 more per hour than those under the CSA. The hourly rate for Driver/Mentor EA drivers is $34.8434 compared to $33.8940 for STA drivers. During cross examination he accepted that driver income is influenced by penalty rates and overtime, which can vary significantly depending on the nature of the shifts worked and that the penalties and allowances in the CSA were more generous than in the Driver/Mentor Agreement.

Mr Gibson referred to the history of agreements applying to private bus operators generally. He explained that historically there was an industry collective agreement negotiated by the Bus Industry Council of NSW and the TWU. That agreement was the basis for the Driver Mentor Agreement. It was also the basis for a number of other agreements applying in other Regions of Sydney where the bus service had been privatised. Mr Gibson provided copies of four such agreements.

Mr Danial Gibson manages a team of 20 employees who create and manage routes, timetables, and rosters for all of Busways Group operations in metropolitan Sydney, the central and north coasts of NSW, and Adelaide. He explained that in February 2025 there were 529 drivers (66.3%) drivers covered by the CSA and 268 drivers (33.6%) covered by the Driver/Mentor Agreement. In March 2025 the roster in Sydney’s Region 7 changed. Mr Gibson provided a spreadsheet identifying the number of hours and counts of shifts that had been allocated to full time STA drivers and full time Driver/Mentor employees under the new rosters.

Mr O'Neill, CEO of Busways Group since January 2025 and former Chief Financial and Commercial Officer, outlined the company's history, operations, and tendering strategy for bus contracts in New South Wales, including services previously run by STA. The Busways Group is Australia's largest privately-owned bus operator, providing contracts and corporate support across its entities. With over 80 years of operation and a fleet of around 1,415 buses, the group actively seeks new tender opportunities to strengthen its market position.

Busways Group participated in the tendering process for a number of contracts in NSW previously held by the STA. The NSW government began outsourcing STA bus services in mid-2017, with contracts tendered by geographic areas or Regions. Mr O'Neill led the bid team for these contracts. A new corporate entity, Busways, was established specifically for the Region 7 tender. Busways was required to undertake that it would offer employment to STA drivers under the CSA as part of the tender process. Compliance with the Act was also necessary for the successful bidder.

Mr O’Neill also gave an account of the steps taken to make an enterprise agreement under the Act to cover Region 7. Busways negotiated the Greenfields Agreement with the TWU to address industrial relations for the tender. The Greenfields Agreement was approved by the Commission on 9 September 2020. Once the RTBU commenced legal challenges, Busways made the Driver/Mentor Agreement with a small number of employees as a backup to the Greenfields Agreement. The Driver/Mentor Agreement was approved on 14 October 2021 and operated from 1 November 2021. Mr O’Neill said Busways navigated complex union dynamics between the TWU and RTBU during this process. The TWU was initially seen as the primary union for private sector drivers, while the RTBU represented STA drivers only. The potential for joint coverage by both unions was acknowledged by Busways and informed its strategic planning.

In preparing its tender Busways developed a comprehensive industrial relations plan to manage workforce transitions and union relations. The plan was included in the tender documents. The plan described the industrial landscape in Region 7 as complex. It identified the RTBU opposition to privatisation on the basis it had led to decreased service quality. It observed the RTBU risked losing members to the TWU as privatisation progressed. It noted transferring employees would retain their conditions after the contract commenced and that there was potential for new enterprise agreements. The plan described Busways’ industrial approach as to create a harmonious and productive workforce through collaboration with employees and unions. It set out its “Drivers strategy” as follows:

Drivers strategy:
–     ‘Grandfathering’ the transferring drivers Award terms and conditions, and negotiating in good faith a replacement agreement that will not materially change the terms and conditions enjoyed by the transferring drivers, except where it is amended by mutual agreement where the drivers are fairly compensated
–     A new drivers EA negotiated with TWU that will apply to new drivers employed by Busways for the GSBC7 contract.
A collaborative partnership approach with both unions, Busways is committed to ensuring that no driver suffers from any form of discrimination.
–     Minimising risk of the entire driver workforce being able to take protected industrial action at any one time
–     Maintaining multiple EA’s, as permitted by the FWC.

The plan described the differences in the terms between the CSA and the Greenfields Agreement. The plan stated the overall driver wages were approximately 9.6% lower under the Greenfields Agreement when compared to overall driver wages under the NSW Award. This reduction was said to be largely driven by savings in not-in-service time (a 15% reduction). Busways strategy was to provide for a gradual realisation of these savings through the contract period. A table in the plan set out the differences between the NSW Award and the Agreement. It referred to:
a) The removal of restrictions on the employment of casual and part time drivers.
b) The removal of standing or layover time.
c) The removal of fixed sign on/sign off times.
d) The removal of the requirement to provide drivers with meal rooms.
e) The replacement of restrictions on when and how driver roster changes can occur with a requirement to consult on changes before implementing them.
f) Greater flexibility in requiring broken shifts through increased spread of hours, removing restrictions on the length the portions of the shifts, and removing restrictions on meal breaks in broken shifts.
g) Reductions in shift penalties.

The Greenfields Agreement was in similar terms to the Driver/Mentor Agreement. Mr O’Neill set out his understanding of the differences between the CSA and the Driver/Mentor Agreement as follows:

74. My understanding of some of the cost differences are, STA Drivers receive:
(a) an addition week of annual leave;
(b) certain penalties at different times;
(c) different penalties;
(d) increased personal leave entitlements after the first 5 years; and
(e) additional long service leave.

75. My understanding of some of the productivity differences are:
(a) where meal breaks may be taken;
(b) the duration of unpaid meal breaks;
(c) the length of broken shifts;
(d) the ability to roster meal breaks in broken shifts
(e) the length of ordinary working hours;
(f) no constraint on the employment of part time employees or casual
employees;
(g) no artificial constraint on maintaining pay when a new timetable is issued by TfNSW;
(h) more flexible layover time;
(i) more flexible stand by time in the depot;
(j) more flexible late running rules; and
(k) more flexibility in build rosters using differing shift types.

Mr O’Neill referred to a 15% improvement in productivity calculated over the life of Contract based on the change out of STA drivers for new drivers engaged under the Driver/Mentor Agreement allowing the adoption of more flexible conditions and more favourable labour costs.

Returning to the plan, it dealt with the possibility of the Greenfields Agreement being successfully challenged. It described the possibility of negotiating a new agreement in the event that the Greenfield Agreement was quashed and recorded that Busways had secured the ability to negotiate a new agreement with the TWU which would have similar terms to the Greenfield Agreement. The plan included the following passage:

In the unlikely event that the New Driver EA is found to be invalid, Busways has secured the ability to negotiate a new instrument for new (non-transferring) drivers with the Transport Workers Union from Contract Execution with similar terms as the New Driver EA. The previous endorsement of the New Driver EA terms by the Transport Workers Union will help to facilitate negotiations for this new instrument if required.

The document went on to address the possibility of there being no agreement for non-transferring employees and stated:
In any event, even if for some reason new drivers did ultimately need to be engaged on terms reflecting those of the transferring employees, Busways has factored this possible outcome into its bid and it will not threaten the financial viability of our bid. That is, Busways guarantees that, regardless of any challenge to the New Driver EA succeeding, Busways would ensure continuity of bus services and would maintain the price commitment and promises outlined in the bid.

At the time of the bid Mr O’Neill anticipated that the proportion of STA drivers would decline each contract year (CY) as follows:

CY1	CY2	CY3	CY4	CY5	CY6	CY7	CY8
Proportion of STA drivers	80%	70%	60%	50%	40%	30%	20%	10%
Proportion of new drivers	20%	30%	40%	50%	60%	70%	80%	90%

The actual numbers for the first 4 years were provided. They were:

Year STA Drivers New Drivers Total Drivers

2022 833 27 860

2023 723 93 816

2024 618 194 812

2025 564 319 883

Expressing these figures as percentages gives the following result:

2022 2023 2024 2025

Proportion of STA drivers 97% 89% 76% 64%

Proportion of new drivers 3% 11% 24% 36%

The tender bid for Region 7 was submitted on 18 December 2020. It included detailed responses on various matters such as the Busways Group’s’ bus operations experience, financial strength, safety management, and customer experience. It also addressed other information required by a pro forma tender document. Busways' pricing methodology for the bid was also included. Busways' pricing strategy involved a detailed analysis of resource requirements and cost estimations. The bid included a constant in-service delivery kilometre assumption and did not account for inflation. Multiple tables detailing costs for driver labour, maintenance, fuel, and other operational expenses were included. Key pricing assumptions included a reduction in driver labour costs over time and a peak in maintenance costs in the second contract year.

I was taken to figures in the bid documents which set out the expected contract price over the life of the Contract. The labour component relating to drivers was as follows:

Drivers $	Maintenance $	Total $
CY1	REDACTED	REDACTED	REDACTED
CY2	REDACTED	REDACTED	REDACTED
CY3	REDACTED	REDACTED	REDACTED
CY4	REDACTED	REDACTED	REDACTED
CY5	REDACTED	REDACTED	REDACTED
CY6	REDACTED	REDACTED	REDACTED
CY7	REDACTED	REDACTED	REDACTED
CY8	REDACTED	REDACTED	REDACTED

Mr O’Neill was cross examined on these figures and confirmed that there has been some variations in the costs associated with the actual performance of the contract. Which is to say that the actual costs incurred since the contract was signed have differed from the predictions in the bid document. The bulk of those changes were associated with factors other than wages, and those changes have led to increased costs which has in turn led to the contract becoming unprofitable for Busways. The changes include the impact of the response to the COVID-19 pandemic, a shortage of bus drivers, changes to the fleet, and changes to timetabling, scheduling and rostering.

TfNSW’s assessment of Busways' bid involved some toing and froing. It included a process of clarifying material provided through questioning and agreeing changes through negotiations. The questioning phase lasted approximately four to five months. On May 6, 2021, Busways was notified that it was the Preferred Tenderer, leading to a two-week negotiation period. The contract between Busways and TfNSW was finalised and signed on July 29, 2021. The contract term was set for 8 years, with monthly payments made in arrears. The annual payment is subject to adjustments for service level changes, acceptance of options, and rise and fall indexation.

There was then a transition period from contract signing to service commencement which Mr O’Neill said faced several operational challenges. The transition lasted from July 29, 2021, to January 9, 2022, focusing on operational preparations. There was an initial shortage of drivers and Busways began recruiting new drivers due to its concerns about driver numbers.

Mr O’Neill said that the financial performance under the Region 7 contract has led to significant losses in the initial years. FY22 reported a profit due to reduced operations during COVID-19, while FY23 and FY24 showed losses before tax. Key factors for losses included driver shortages, key performance abatements, and wage adjustments. Mr O’Neill said that the financial performance is expected to face ongoing operational challenges rising from the impact of external factors. During cross examination Mr O’Neill clarified that key cost issues included post-COVID challenges such as driver shortages, increased overtime, and higher maintenance costs, with parts prices rising by 35%. Management fees were also significantly higher than projected in the bid, contributing to cost overruns, while motor vehicle expenses increased due to outsourcing due to shortages of mechanics. Mr O'Neill acknowledged that the CSA was not the sole source of financial difficulties, with broader economic and operational challenges impacting profitability.

Mr O’Neill was hopeful that for the remaining life of the Contract, by utilising a rostering approach that accommodates new drivers being engaged on a Driver/Mentor Agreement roster and STA drivers being engaged on a CSA roster, Busways can bring the operation either back to a break-even position by the end of the Contract or at least much closer to a break-even position.

Mr O’Neill said that if the RTBU was successful in these proceedings it could lead to increased labour costs, significantly affecting financial viability. If the claim is granted, Busways would incur unanticipated costs due to differences between the Driver/Mentor Agreement and the CSA. He said the estimated cost difference could represent millions over the remaining contract period.

Mr O’Neill said Busways current financial support is contingent upon returning to profitability, with potential termination of the contract if losses continue. He referred to letters of comfort from October 2024 received from Busways Group that guarantees ongoing funding to Busways regardless of its financial success as an operation. The guarantee is for at least 12 months from the letter. Mr O’Neill confirmed these letters of comfort have been issued each year since the contract began.

Mr O’Neill was cross examined on the letters and on undertakings provided to TfNSW through bonds issued by the Commonwealth Bank. The bonds were entered into in 2022 and 2024, and they ensure that if Busways is unable to meet the obligations under the Contract to provide bus services, then compensation payments to TfNSW will be made up to defined limits. Mr O'Neill explained that the unconditional undertakings to provide compensation allow TfNSW to call on sums of money if Busways becomes unable to meet its contractual obligations. These guarantees are supported by security provided by Busways Group entities.

Mr O’Neill’s evidence was that the roster changes implemented in March 2025 aimed to improve operational efficiency and employee allocation. The new roster introduced a roster line for Driver/Mentor Agreement employees, and reallocated lines of work previously done by STA drivers. A consultation process was used to inform and gather feedback from drivers regarding the changes. Displaced drivers were identified, with a commitment to ensure a fair distribution of work across different employee groups.

He said Busways intention was to implement strategies to manage and reduce overtime across its operations. The company aims to align driver numbers with required hours to minimise excessive overtime. His view is that overtime allocation principles ensure fairness across different driver groups, with a focus on working hours which are permitted by the industrial instruments. He said the process for unrostered overtime remains unchanged, maintaining consistency in allocation practices. He said concerns regarding driver safety and shift lengths have been addressed through compliance with regulatory standards. All shifts for Driver/Mentor Agreement employees comply with national heavy vehicle regulatory standard hour requirements, ensuring safety. Drivers undergo fatigue training and are required to declare compliance with working hour regulations.

Mr O’Neill pointed to a number of benefits for the company since the March 2025 roster changes including productivity improvements of 15%, reduced overall overtime which contributed to lower fatigue levels among drivers. Busways has also strengthened its position in driver recruitment and retention. The reduction in required lines and improved driver availability have enhanced recruitment efforts. A dedicated recruitment team employs various strategies to attract and retain drivers, including job advertisements and open days. The company is confident in its ability to maintain sufficient driver numbers into the future.

Mr O’Neill accepted that the allocation of work between STA drivers and Driver/Mentor Agreement employees has been a point of contention. STA drivers rotate through various lines, while Driver/Mentor Agreement employees have fixed lines of work. He said the fixed line allocation process aims to ensure fairness, with opportunities for STA drivers to also have fixed lines if desired. The practice of fixed line allocation is common in the private sector, contrasting with rotation system used by the STA. He points to shift swapping processes remaining consistent despite changes in roster arrangements. Drivers can swap shifts by finding a buddy and submitting a request, which is checked for fatigue compliance. Data indicates that the number of shift swaps requested and approved has remained stable post-roster changes. The process aims to maintain flexibility and accommodate drivers' needs while ensuring safety standards are met.

Mr O’Neill accepted that a number of drivers that no longer have an allocated line of work in their roster group became effectively 'overflow' workers who can be allocated to relief work as needed. These are the displaced drivers referred to elsewhere in the evidence. He said it was not the intention that a disproportionate number of STA drivers would be displaced. Mr O’Neill offered an undertaking to address the issue. The undertaking is that within 12 months of a decision not to make a consolidation order rosters will be amended to ensure:

(a) no more than 68.5% of the displaced drivers will be STA Drivers; and
(b) accordingly no less than 31.5% of the displaced drivers will be allocated to
the Driver EA employees.

The RTBU relied on an expert report from Professor Martin O’Brien to refute the evidence of Mr O’Neill about productivity. Professor O'Brien holds the position of Professor, Discipline of Economics in the School of Business at the University of Wollongong He holds extensive academic qualifications including a PhD in Economics from the University of Newcastle. He has authored numerous journal articles and book chapters focusing on labour market dynamics and economic policies.

Professor O’Brien’s report evaluated the productivity claims made by Mr. O’Neill about the impact on productivity of the application of the CSA to all drivers in Region 7. It considered the claim that productivity would improve by 15%. Professor O’Brien described the claim of a 15% improvement in productivity associated with the Driver/Mentor Agreement, was in fact a claim that not-in-service time would be reduced by 15% under the Agreement compared with the CSA. He defined productivity as the ratio of in-service bus hours to driver paid hours and pointed out that while cost savings are related to, they will not always equate to productivity improvements. Professor O’Brien criticised Mr O’Neill’s claimed reduction in not-in-service time as being attributable to the industrial instruments, instead attributing this to differences in matters such as layover time, sign-on/off times, and rostering flexibility.

Professor O’Brien’s report concluded that that the methodology and data supporting the 15% reduction were unclear and lacked verification. While some of the Driver/Mentor Agreement terms that have been implemented could impact productivity, their exact contribution was not quantified. He referred to the material provided by Mr O’Neill from the bid process which predicted a 14% reduction in not-in-service time from 2022 to 2029: 9.5% of this reduction occurred between 2022 and 2023, with only a small change in workforce composition being a 10% decrease in STA drivers. He observed that this suggests other factors, independent of workforce composition, were the primary drivers of improvement. Professor O’Brien also observed that the bid documents suggested that productivity would increase in 2023 but remained stable until 2028, despite significant changes in workforce composition. This indicates that productivity was largely unaffected by the proportion of drivers covered by the Driver/Mentor Agreement as opposed to the CSA .

Consideration

The CSA incorporating the terms of the NSW Award came into existence on 9 January 2022 and applied to employees of STA who transferred to Busways to drive buses under the Contract. The RTBU seeks a consolidation order under s. 768BG(1) that the CSA, a copied State instrument which applies to the STA employees, is also a copied State instrument for non‑transferring employees. There is no contest, and I find, that there are non-transferring employees, for the purposes of s 768BG(1) who perform the same, or substantially the same, work as that performed by transferring employees. There is also no contest, and I find, for the purposes of s 768BG(3), that the RTBU is able to make the application.

I note that under s 768AO(2), that the CSA will only operate for a period of five years after the transfer which was 9 January 2022 and will cease to operate in January 2027. This period may be extended should a regulation be made permitting an extension (s 768A)(2)(b)). No such regulation has been made.

In deciding whether to make an order I must take into account the matters in s 768BG(4), which reads:
(4) In deciding whether to make a consolidation order under subsection (1), the FWC must take into account the following:
(a) the views of:
(i) the employees who would be affected by the order; and
(ii) the new employer or a person who is likely to be the new employer;
(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 a copied State employment agreement or an enterprise agreement—the nominal expiry date of the agreement;
(d) whether the copied State instrument for employee A would have a negative impact on the productivity of the new employer’s workplace;
(e) whether the new employer would incur significant economic disadvantage if the order were not made;
(f) the degree of business synergy between the copied State instrument for employee A and any workplace instrument that already covers the new employer;
(g) the public interest.

Submissions were put about the operation of section 768BG(4) and whether it is exhaustive of the matters that may be taken into account. The RTBU contended that subsection (4) is exhaustive, meaning the Commission's discretion is limited to weighing up the factors explicitly listed. Busways argued that subsection (4) is not exhaustive and that the Commission can take into account other matters beyond those listed. Busways referred to the language of subsection (1), which states that the Commission may make an order, as indicative of a general discretion. It argued that subsection (4) therefore does not limit the Commission to only considering the listed factors. Busways referred to s 578 of the FW Act, which requires the Commission, when exercising it functions, to consider the objects of the Act and equity, good conscience, and the merits of the matter. Busways submitted that s 578 applies to the discretion provided by s768BG(1).

I consider the argument an arid one in the circumstances of this case, as each of the matters raised by the parties fall within the considerations lists in s768BG(4). The key arguments raised by the union go to:

a)The preference of the employees for the order to be made.
b)The undesirability of maintaining a two-tiered workforce arising from the different terms and conditions in the two instruments.
c)The disadvantage to the Driver/Mentor employees whose terms and conditions of employment are inferior to the CSA.
d)The disadvantage to STA employees who have been displaced by the new roster which takes advantage of the terms of the Driver/Mentor Agreement.
e)Fatigue and safety concerns associated with rostering arrangements implemented to give effect to the cost savings available under the Driver/Mentor Agreement.

The key issues raised by Busways:

a)Its opposition to the application.
b)The impact of applying the CSA to the entire workforce, including on profitability and service delivery.
c)The adverse impact on productivity of applying the restrictive rostering practices associated with the CSA to the whole workforce.
d)The benefits the two instruments provides in relation to operational flexibility.
e)The undesirability of making orders that will improve the RTBU’s bargaining position in ongoing negotiations.

Each of these issues are relevant to, and will be considered, when taking into account the matters in s. 768BG(4).

Had it been necessary to resolve the issues raised I would have been inclined to find that factors such as the objects of the Act and equity, good conscience, and the merits of the matter are, in any event contemplated by the public interest considerations required by s 7687BG(4)(g).

768BG(4)(a) the views of the employees and Busways

I was provided with a petition gathered by RTBU delegates that indicated that the employees support the application. The petition was in the following terms:

By signing this petition, I confirm:
1. I am employed by Busways North West Ply Ltd (Busways) as a Bus Driver (or equivalent) working in the bus service in Region 7 In Sydney;
2. I am covered by the Busways Driver/Mentor Enterprise Agreement 2021 (Busways Agreement);
3. I understand that the Australian Rail. Tram and Bus Industry Union (RTBU) has made an application under the Fair Work Act 2009 (Application) seeking an order (Proposed Order) that the State Transit Authority Bus Operations Enterprise (State) Award 2021 (Award), being the copied state instrument which applies to transferring employees of Busways. is also a copied state award for non-transferring employees under the Busways Agreement, meaning that the Award would apply to me and set the terms and conditions of my employment instead of the Busways Agreement;
4. I support the Application and the Proposed Order being made by the Fair Work Commission (FWC); and
5. I understand that this petition may be used as evidence by the RTBU in support of the Application and the Proposed Order being made by the FWC.

Busways submitted that the petition should not be given weight because of the manner in which the signatures were gathered and the misinformation associated with the impact that the order would have on employees. These factors are said to undermine confidence in the petition and whether it accurately records an informed position on behalf of the relevant employees.

In considering this submission I take into account the evidence of the bus driver witnesses. They were long standing bus drivers some of whom have been driving buses for decades. They gave forthright evidence. Their evidence was that all drivers, both transferring and non-transferring employees resented the two-tier workforce created by the two sets of terms and conditions. This resentment has been exacerbated by the roster changes made in March 2025 by which Busways has implemented the differing terms and conditions to reduce costs and displace STA Drivers.

I am not persuaded by Busways criticisms of the RTBU and the drivers about the way the petition was collected. It is established in the evidence that there is a two-tier workforce in which the STA drivers have greater protections and more beneficial terms and conditions of employment than the Driver/Mentor employees. The comparisons between the CSA and Agreement are set out earlier. It is also clear that those differences have driven a workplace restructure to allocate work in a manner that avoids or minimises affording the protections and benefits of the CSA in favour of the greater flexibility and cost savings available through rostering the non-transferring employees in a different manner to the STA employees. I am satisfied that the employees are aware of the disparity in the industrial instruments and the reason that the rostering practices have been changed. In signing of the petition, the employees would no doubt have been informed by that awareness. The failure of those collecting the petition to inform employees that the CSA is likely to expire in January 2027 does not detract from the force of the views expressed by the witnesses on behalf of their workmates nor the clear statement of support for the application.

The employees views supporting the order is a factor favouring the making of the order.

Busways opposes the order. Its opposition is grounded in a desire to avoid affording the terms and conditions that apply to STA Drivers, who comprise 60% of its workforce, to the other 40%. The opposition arises from a desire to reduce labour costs in the interests of improving its financial position under the Contract. Mr O’Neill accepted that the factors leading to the parlous financial position of the Contract were not confined solely to increased labour costs. Busways opposition to the order was consistent with an overall desire to ensure the financial position is improved. Its view is informed by the cost savings made by the changes to rosters in 2025.

Busways opposition to the order is a factor in favour of dismissing the application.

768BG(4)(b) whether any employees would be disadvantaged by the order;

There is no disadvantage to employees in the making of the order. The evidence is that the CSA provides better terms and conditions overall with superior benefits in relation to leave and penalties and greater protections especially in relation to hours of work. The transferring employees will be advantaged by the order as they will receive improved terms and conditions. The non-transferring employees will also be advantaged by not having their terms and conditions undermined by Busways re-arranging rosters to take advantage of the flexibilities in the Driver Mentor Agreement.

The fact that no employees will be disadvantaged by the order is a factor that favours the making of the order.

768BG(4)(c) if the order relates to an agreement—the nominal expiry date of the agreement;

The order relates to an award. This consideration is irrelevant.

BG(4)(d) whether the copied State instrument would have a negative impact on productivity

There was a contest over whether there would be a negative impact on productivity. The contest included the question of how productivity should be measured. The Full Bench in the 4 yearly review of modern awards – Penalty Rates [2017] FWCFB 1001 observed that the word productivity is referred to in a number of places in the Act. In that case, which was dealing with the use of the term in s. 134, the modern awards objective, the Full Bench proceeded on the basis that ‘productivity’ related to the economic concept of the number of units of output per unit of input. The Full Bench said at [224]:

[224] The conventional economic meaning of productivity is the number of units of output per unit of input. It is a measure of the volumes or quantities of inputs and outputs, not the cost of purchasing those inputs or the value of the outputs generated. As the Full Bench observed in the Schweppes Australia Pty Ltd v United Voice – Victoria Branch:
‘… we find that ‘productivity’ as used in s.275 of the Act, and more generally within the Act, is directed at the conventional economic concept of the quantity of output relative to the quantity of inputs. Considerations of the price of inputs, including the cost of labour, raise separate considerations which relate to business competitiveness and employment costs.
Financial gains achieved by having the same labour input – the number of hours worked – produce the same output at less cost because of a reduced wage per hour is not productivity in this conventional sense.’

Busways contends that extending the CSA to the non-transferring employees will have an adverse impact on productivity. The RTBU responded that the evidence did not establish that this was the case. The RTBU contended that Busways was using productivity as a proxy for labour cost savings.

Professor O’Brien referred to the relevant inputs as driver paid hours and outputs as in-service bus hours. Mr O’Neill claimed that the restrictions in rostering in the CSA resulted in a 15% reduction in not-in-service time. Reference was also made to improvement arising from layover time, sign-on/off times, and rostering flexibility. Professor O’Brien cast doubt on the basis for the claim that there was a 15% reduction in productivity. Professor O’Brien accepted that the Driver/Mentor Agreement terms could potentially impact productivity, his criticism was that their exact contribution was not quantified. I note Professor O’Brien’s references to the figures in the bid documents which predicted a 14% reduction in not-in-service time from 2022 to 2029 and that 9.5% of this reduction occurred between 2022 and 2023, with only a small change in workforce composition being a 10% decrease in STA drivers. I accept the RTBU’s criticisms that the extent of the productivity improvements has not been established.

Busways pointed to improvements under the EA in "dead running" time (also referred to as "dead heads") which are unproductive driver hours spent moving buses without passengers. It said the Driver/Mentor Agreement also gives flexibility allowing more efficient rostering practices as demonstrated by the new roster line created to take specific advantages of the flexible arrangements. Busways also relied on greater capacity to engage part-time and casual employees.

While I accept the criticisms that the evidence quantifying the extent of the productivity gains associated with the Driver/Mentor Agreement is unreliable, I agree with Busways that having access to the flexibilities in the Agreement for part of its workforce provides Busways with the ability to provide the same bus service with fewer driver hours. This can be achieved, for example, by reducing the number of dead heads and by using the more flexible arrangements associated with split shifts.

While the extent of the productivity advantages of having 40% of the workforce on the Driver/Mentor Agreement has not been established, I consider that the order sought will have a negative impact on productivity.

The negative impact on productivity is a factor weighing against making the consolidation order.

768BG(4)(e) whether the new employer would incur significant economic disadvantage if the order were not made;

The parties agree, and I find, that this factor is neutral and so not relevant in my consideration.

768BG(4)(f) the degree of business synergy between the copied State instrument and any workplace instrument that already covers the new employer;

The RTBU contended that there is minimal business synergy between the CSA and the Driver/Mentor EA. It submitted the two instruments are fundamentally different, reflecting distinct industrial contexts (STA conditions vs. private bus operator conditions). The CSA is based on government conditions developed over decades, while the Driver/Mentor EA reflects the industry template for private bus operators. These differences mean the two instruments do not align well and do not operate seamlessly together.

The changes to the roster in March 2025 was cited as evidence of the lack of synergy. The new roster group was necessary because the workforce could not be integrated effectively. The RTBU pointed to provisions in the CSA such as meal breaks at depots and shorter broken shift spans as incompatible with the rostering flexibility provided by the Driver/Mentor EA. The RTBU argued that the lack of business synergy weighs in favour of granting the order, as making the order would create a single set of conditions.

Busways argued that the CSA and the Driver/Mentor EA work together to achieve business synergy. The dual-instrument approach was part of Busways' bid for the Region 7 contract. The use of two instruments allows Busways to deliver services more efficiently and cost-effectively. Busways submitted that the two instruments complement each other, with the Driver/Mentor Agreement providing flexibility and cost savings while the CSA preserves the conditions of transferring employees. This dual approach was seen as a strategic decision to balance efficiency and fairness. Busways contended that granting the order would undermine the business synergy achieved through the dual-instrument approach.

Both parties referred me to the Full Bench decision in TasTAFE v United Workers' Union and Australian Education Workers' Union [2023] FWCFB 123 (TasTAFE). The Full Bench said at [69] to [71]:

[69] We consider that this appeal ground is, in substance, simply a complaint that the Commissioner did not accept TasTAFE’s submissions in respect of s 768BG(4)(f). It is a statement of the obvious that the analysis required by the provision proceeds upon the position applying if a consolidation order is not made, namely that copied State instruments apply to transferring employees and different FW Act instruments apply to non-transferring employees. Section 768BG(4)(f) requires the Commission to assess the degree of ‘business synergy’ between the different instruments. The Commissioner correctly stated the task he was required to undertake under the provision when he said in paragraph [136]: ‘The question is, having regard to the ordinary meaning of synergy, what is the evidence as to the combined or co‑operative action of copied state instruments and the Modern Award?
[70] The conclusion reached by the Commissioner that there was a lack of business synergy between the relevant copied State instruments and the modern awards applying to non transferring teaching and general staff and EFAs was not only open to him but was the obvious conclusion based on a comparison of the terms of the instruments and the evidence concerning their operation. For example, in respect of teaching staff, TasTAFE’s own witnesses pointed out the differences in the provisions concerning working and teaching hours and other matters between the copied State instruments applicable to teachers and the PSE Award. The clearest evidence of this was given by Ms Holland: she identified in her witness statement a range of operationally significant differences between the copied State instruments and the PSE Award concerning leave entitlements, rostering of teaching hours, continuity of training, and delivering training in rural and remote locations. Ms Holland raised these matters in support of her opinion that the PSE Award ‘has greater business synergy’, but the objective conclusion that may be drawn from her evidence is that the differences she identified demonstrate a lack of business synergy or ‘degree of fit’ (to use the phrase in TasTAFE’s submissions) between the copied State instruments and the PSE Award.
[71] The proposition advanced by TasTAFE in its appeal that ‘it is for the employer to identify the desirability or undesirability of the degree of synergy’ is plainly incorrect. It is for the Commission under s 768BG(4)(f) to form its own view about the matter based on an objective analysis of the evidence, and for the Commission simply to defer to the subjective view of the employer would be in error. In any event, as explained, TasTAFE’s own evidence was demonstrative of the conclusion reached by the Commissioner.

The Full Bench made it clear that the task posed by s. 768(4)(f) is to make a comparison of the terms of the instruments and the evidence concerning their operation, not simply to accept the employer’s view as to the desirability or undesirability of the degree of synergy. Busways’ argument that using both the CSA and the Driver/Mentor Agreement together was a strategic choice to balance efficiency and fairness maybe the case, but it cannot be accepted as establishing business synergy. It is the case that the CSA safeguards conditions for transferring employees, while the Driver/Mentor Agreement provides cost savings and flexibility. But the difference in the instruments create dissonance not synergy. Busways submission simply expresses a desire to continue to use the dissonance between the instruments in a way that allows the efficiencies drawn from the Agreement to continue. Busways preference for dissonance however does not meet the test in s. 768(4)(f).

The task is to make an assessment of the synergy between the instruments. Here, as in the TasTAFE case, there are clear differences between the relevant instruments. The differences have already been described. They are apparent in both the RTBU and Busways evidence. The operational changes that have arisen from those differences are evident in the roster changes introduced in March 2025. There is clearly a lack of business synergy between the two instruments. The differences is supported by the evidence. It is not simply a matter of opinion. The lack of business synergy can be addressed by a single instrument to cover all employees, eliminating the differences that have created a two-tier or dual-instrument approach to regulating the same work.

The lack of synergy between the CSA and the Driver/Mentor Agreement weighs in favour of making the consolidation order.

768BG(4)(g) the public interest.

The Full Bench in Australian Municipal, Administrative, Clerical and Services Union v Central Goldfields Shire Council[2024] FWCFB 444 recently considered how the public interest should be taken into account in exercising the discretion to make a single interest employer declaration. I consider the observations made by that Full Bench relevant here. The Full Bench said at [69] – [71]:

[69] It has long been recognised that the expression “in the public interest” imports a discretionary value judgment to be made by reference to undefined factual matters, confined only “in so far as the subject matter and the scope and purpose of the statutory enactments may enable ... given reasons to be [pronounced] definitely extraneous to any objects the legislature could have had in view”. In which direction the public interest points may not be easy to discern. Ascertainment in any particular case of where the public interest lies may require a balancing of countervailing public interests. In Re Queensland Electricity Commission; Ex parte Electrical Trades Union of Australia (1987) 61 ALJR 393, for example, Mason CJ, Wilson and Dawson JJ said (at 395):
... Ascertainment in any particular case of where the public interest lies will often depend on a balancing of interests, including competing public interests, and be very much a question of fact and degree. In this case the Commission was called upon to weigh in the balance two competing public interests. One was the importance of settling in its entirety the dispute initiated by the E.T.U.’s log of claims. The other was the importance of leaving the dispute to be resolved by the State tribunal despite the limitations on its jurisdiction if that course was likely to maintain the marked improvement in industrial relations in the industry that had occurred since the dispute arose and thereby contribute to industrial peace and an efficient power supply.

[70] In identifying matters that may be relevant to an assessment of the public interest, a distinction is often drawn between matters affecting the public interests and the private interests of the parties. In Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000 (2005) 139 IR 34, the Full Bench explained (at [23]):
The notion of public interest refers to matters that might affect the public as a whole such as the achievement or otherwise of the various objects of the Act, employment levels, inflation, and the maintenance of proper industrial standards. An example of something in the last category may be a case in which there was no applicable award and the termination of the agreement would lead to an absence of award coverage for the employees. While the content of the notion of public interest cannot be precisely defined, it is distinct in nature from the interests of the parties. And although the public interest and the interests of the parties may be simultaneously affected, that fact does not lessen the distinction between them

[71] The distinction between matters that affect the public interest as opposed to the private interests of the parties will often not be clear. A consideration may affect both the interests of the public at large and the interests of one of more of the parties to the proceedings. The interests of the public might also be affected as a result of the impact of an authorisation on one of the parties. The assessment of whether the making of an authorisation is contrary to the public interest will depend, very much, on the facts of a particular case.

In TasTAFE the Full Bench said:

[51] In his consideration under s 768BG(4)(g) in relation to the AEU’s application, the Commissioner stated that the public interest is distinct from the views of the parties (although the considerations may overlap), requires a discretionary value judgement confined by the subject matter, scope and purpose of the FW Act, and that the objects of the FW Act are clearly relevant to a consideration of the public interest as well as matters that may affect the public as a whole. These principles are derived from the Full Bench decision in Parks Victoria v AWU.[20] Although that decision concerned the reference to the public interest in the different context of s 275(d) of the FW Act, both the AEU and TasTAFE cited this decision below as identifying the correct approach to be taken to the conception of the public interest in s 768BG(4)(g). No criticism is made of this statement of principle by TasTAFE in its appeal, and the Commissioner may therefore be taken as having proceeded upon a correct understanding of the statutory task under s 768BG(4)(g).

Accordingly, assessing the public interest involves a discretionary judgement, balancing various competing factors relevant to the case and the broader objectives of the FW Act. The public interest is distinct from the private concerns of the parties, though some overlap is possible. Relevant considerations include the Act’s objectives, impacts on employment, industrial standards, and the interests of the community at large, rather than purely those of employers or employees. The process requires a value judgement and consideration of matters such as productivity and fairness, rather than simply accepting the perspective of any one party.

I also consider that s. 768BG should be read and applied as a beneficial provision with a purpose of protecting terms and conditions of employment in the event of a transfer or transmission of business. It is a long-established principle that employment obligations should not be avoided when employees are transferred from one employing entity to another. In George Hudson Ltd v. Australian Timber Workers Union (1923) 32 CLR 413 the High Court considered the question of whether it was within the power of the Commonwealth Parliament to enact provisions to the effect that an agreement made between parties to an industrial dispute should be binding not only on those parties, but also on a successor in business or assignee of the business of a party to the agreement. In addressing the underlying policy of the law Higgins J said at 452:
...men are not so likely to submit to peaceful methods of settling disputes, by agreement (conciliation) or awards (arbitration) if they feel that those with whom they dispute can evade the obligations imposed by transferring their businesses to their sons, or by assigning it to a company having a new name and the same shareholders.

This principle was referred to again by the High Court in Minister for Employment and Workplace Relations v Gribbles Radiology Pty Ltd [2005] HCA 9; 222 CLR 194 when considering the transmission of business provision in s. 149(1) of the Workplace Relations Act 1996. At [88] of that decision the Court said:

First, there is the context and purpose of the section. Adopting a purposive construction to legislation is now the usual approach of this Court, as of other courts in contested issues of statutory construction. Subject to the Constitution, that is the approach that should be taken to a facultative provision such as s 149(1)(d) of the Act. The purpose of that paragraph, as the Full Court correctly recognised, was to ensure the successful attainment of the power in the industrial tribunal "to settle industrial disputes effective[ly] by extending the instrument of settlement to 'the ever changing body of persons within the area of such disturbances'"

The RTBU submitted that the purpose of the transmission of business provisions is to protect employees' terms and conditions post-privatisation. Extending the CSA to new employees aligns with this purpose and serves the public interest by ensuring fair treatment of workers. The union submitted that having employees performing the same work under different terms and conditions is inherently unfair and undermines workplace cohesion, which is contrary to the public interest. Granting the order would eliminate the two-tier workforce, which is said to undermine the CSA employment conditions, affect recruitment and retention, reduce job security for transferring employees, and is inherently undesirable.

The RTBU contended that granting the order would promote industrial relations stability by creating a unified workforce under a single set of terms and conditions. This would reduce tensions between employees and improve morale, which is in the public interest.

Busways submitted that granting the order would impose significant financial costs on the company, which could threaten the financial viability of the Region 7 contract. It submitted that financial instability could create uncertainty about the continuity of bus services in Region 7, which would not be in the public interest.

The RTBU challenged Busways' claims about financial instability, arguing that the parent company has significant financial resources and has provided letters of comfort to ensure the solvency of the Region 7 operations. Busways, while acknowledging that Region 7 operation is part of a larger corporate group, countered that the letters of comfort and financial guarantees provided by the parent company are not guaranteed indefinitely. It suggested that the parent company might reconsider its support if Region 7 became unprofitable, potentially jeopardizing service delivery. Busways submitted that it is delivering a critical public service, and any disruption to its operations would have a direct impact on the community. The financial strain caused by the order could undermine its ability to meet its contractual obligations to TfNSW.

Busways also raised concerns about the potential for industrial action by the RTBU, which could disrupt bus services and inconvenience the public. The RTBU argued that granting the order would promote industrial relations stability by creating a unified workforce under a single set of terms and conditions. This would reduce tensions between employees and improve morale, which is in the public interest.

Busways focus is on the potential financial and operational risks of granting the order, including the possibility of service disruptions. The RTBU submits fairness, equity, and the elimination of the two-tier workforce as being in the public interest, while downplaying the risks highlighted by Busways.

I accept the RTBU’s submissions that a two-tier workforce where employees have different terms for the same work is unfair and undermines workplace cohesion. Granting the order would unify employment conditions, improve morale, promote industrial relations stability, and support fair treatment for workers. It will also provide a stable base for negotiating a replacement agreement. These factors meet the fairness aspects of the object of the Act expressed in s 3 (a) and (d) and in achieving the productivity and fairness through an emphasis on enterprise bargaining in 3 (f).

Busways submissions are unpersuasive. Its focus is on its subjective interest in reducing labour costs through the application of the inferior penalties, allowances and benefits to a significant proportion of its workforce. So far as the terms lead to some productivity benefits my assessment is that those benefits are outweighed by the public interest in maintaining the application and relevance of the industrial standards contained in the CSA until a replacement agreement can be negotiated. I consider this to be in accordance with the purpose of s 768BG.

The submissions concerning the viability of the contract and the possibility of bus services in Region 7 being adversely affected are undermined by the evidence of the assurance given in the bid process for the Contract that a consolidation order had been factored into its bid and would not threaten the financial viability of the bid and that Busways would ensure continuity of bus services and would maintain the price commitment and promises outlined in the bid. The steps taken to have the bonds in place and the letters of comfort provided by the Busways group reflect that this continues to be the case. I also do not consider that the prospect of industrial action speaks to a public interest in refusing the order. The object of the Act refers to clear rules governing industrial action. Those rules include mechanisms to curtail industrial action should it have adverse impacts on the community.

The public interest factors favour making the order.

Conclusion

Taking into account all of the factors in s. 768(4) I have decided to make a consolidation order under s. 768BG(1). The employees’ views in support are well founded. Busways also has its reasons to oppose the order, but they are founded in a desire to improve its financial position by departing from the CSA conditions. There will be no disadvantage to any employees by making the order. Rather, all employees will be advantaged. There will be a negative impact on productivity but that is outweighed by other factors. There is no business synergy between the CSA and The Driver Mentor Agreement that warrants maintaining the two-tiered structure that currently exists.

The public interest falls in favour of removing the inequities for employees created by two instruments operating to regulate workers performing the same work. A two-tier workforce, where employees performing the same work have different terms and conditions, is unfair and undermines workplace cohesion. The workforce being under a single set of terms and conditions would reduce tensions, improve morale, and promote industrial relations stability. The order will uphold the industrial standards contained in the CSA until a replacement agreement is negotiated. It is also in the public interest to make the order to give effect to the purpose of ensuring transfers of business do not undermine terms and conditions of employment that have been set in industrial instruments.

The parties requested that before the reasons are published they be given an opportunity to review them and request redactions should there be concerns about the publication of confidential material. I was also not provided with a draft consolidations order. Consequently, these reasons are provided to the parties today but not be published and I make the following directions to finalise the matter:

A. The parties indicate what, if any, redactions are sought to these reasons by close of business Wednesday 24 September 2025.
B. The Applicant file and serve a draft consolidation order by close of business Wednesday 24 September 2025
C. The matter is listed to deal with all outstanding matters, in person, at 80 William St East Sydney at 10:00AM on Friday 26 September 2025.

DEPUTY PRESIDENT

Appearances:

Mr L Saunders of Counsel for the Applicant
Mr L Izzo and Ms F Schneider for Busways

Hearing details:

6, 7 & 8 May 2025
Sydney

[1] [2020] FWCA 4823

[2] Australian Rail, Tram and Bus Industry Union v Busways Northern Beaches Pty Ltd, Busways Eastern Suburbs Pty Ltd and Busways North West Pty Ltd t/a Busways & the Transport Workers’ Union of Australia[2021] FWCFB 591

[3] Australian Rail, Tram and Bus Industry Union v Busways Northern Beaches Pty Ltd (No 2) [2022] FCAFC 55

Printed by authority of the Commonwealth Government Printer

Year	STA Drivers	New Drivers	Total Drivers
2022	833	27	860
2023	723	93	816
2024	618	194	812
2025	564	319	883