Australian Turf Club Limited

[2015] FWCA 5218

[2015] FWCA 5218

FAIR WORK COMMISSION

DECISION

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

Australian Turf Club Limited
(AG2015/2545)


AUSTRALIAN TURF CLUB FOOD & BEVERAGE ENTERPRISE AGREEMENT 2015

Hospitality industry
COMMISSIONER BULL	SYDNEY, 5 AUGUST 2015

Application for approval of the Australian Turf Club Food & Beverage Enterprise Agreement 2015.

[1] An application has been made for the approval of an enterprise agreement known as the Australian Turf Club Food & Beverage Enterprise Agreement 2015 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single enterprise agreement.

[2] United Voice was an employee bargaining representative involved in the agreement making process and in its statutory declaration (F18) filed with the application stated that it did not support the approval of the Agreement. The reasons that United Voice submitted in its objection included that the Agreement does not provide for any fixed increases to rates of pay or allowances, employees who work Monday to Friday will not have an increase in their hourly rate, only employees who work weekends and public holidays will receive any increase in rates, and that not every employee would be better off under the Agreement than the relevant award as per s.193(1) of the Act. United Voice wishes to be covered by the Agreement.

[3] The Fair Work Commission (the Commission) wrote to the applicant, copying in United Voice on 11 and 30 June 2015 with respect to the consultation term not meeting the requirements under s.205 of the Act and the rates of pay under the Agreement not adequately compensating for reduced entitlements which employees would otherwise receive under the Hospitality Industry (General)Award 2010 (the Hospitality Award) and the Racing Clubs Events Award 2010 (the Racing Award), being the relevant awards for the purpose of the better off overall test (BOOT) under s.186 of the Act.

[4] The applicant corresponded to the Commission on a number of occasions to address the issues raised, with final undertakings submitted on 22 July 2015.

[5] On 22 and 24 July 2015, the Commission advised United Voice via written correspondence of the undertakings provided by the applicant, and asked for any comment and whether in light of the undertakings provided, supported the approval of the Agreement. No correspondence has been received by the Commission from United Voice.

Consultation term

[6] With respect to the consultation term contained in cl. 21 - Consultation, the applicant was advised that the consultation term did not provide for the employer to consult employees with regard to a change of employees regular roster or ordinary hours of work, as required under s.205 of the Act.

[7] Pursuant to s.205(2) of the Act, the model consultation term at Schedule 2.3 of the Fair Work Regulations 2009 will be taken to be a term of the Agreement. A copy of the model term is attached at Annexure A of this decision.

Better Off Overall Test (BOOT)

[8] With respect to the BOOT, the applicant was advised of the Commission’s concerns that the base rates of pay under the Agreement were not high enough to adequately compensate for the removal of or reduction in entitlements that employees would otherwise receive under the Awards.

[9] At 3.4 of the application (F17) the applicant has stated that the pay rates contained in Schedule 2 of the Agreement are higher than the Awards, and provided a list of average percentage increases of the minimum wage in comparison to the applicable award. At 3.6 of the F17 the applicant states that the Agreement does pass the BOOT.

[10] At 3.5 of the application, terms of the Agreement that are less beneficial than the Awards were listed, including:

i. Lower weekend hourly rates for food and beverage attendants, cook/chefs, back of house, and store-persons;

ii. Lower public holiday rates;

iii. Although the Agreement offers a higher shift allowance, it is only payable to employees who work at engagements/functions that continue after midnight as opposed to 10pm under the Racing Award;

iv. Although the Agreement offers overtime rates that are of the same magnitude as equivalent rates in the Racing Award, they are only payable for hours in excess of 10 hours per day as opposed to 8 hours under the Racing Award.

[11] Whilst the weekday rates of pay are higher under the Agreement, particular consideration must be given to entitlements in the context that the Agreement only covers casual employees and may not be compensated by the balancing out of higher weekday rates.

[12] The applicant was provided with calculative analyses of the pay rates for the different classifications under the Agreement, highlighting the Commission’s concerns that the rates of pay under the Agreement did not appear to adequately compensate for the reduced or removal of the entitlements that employees would otherwise receive under the Awards.

[13] The applicant was also advised of the Commission’s concern that whilst the Agreement provides for annual increases in Saturday, Sunday and public holiday rates of pay for all employees, it does not offer any increases to Monday to Friday rates.  With respect to Monday to Friday rates, the applicant was referred to s.206 of the Act, where it states that the base rate of pay under an enterprise agreement must not be less than the modern award, and that if the agreement rate is less than the award rate, the Agreement has effect in relation to the employee as if the Agreement rate were equal to the Award rate.

[14] On 9 July 2015, the applicant responded to the Commission’s concerns by submitting previous shift rosters and calculations of pay rate comparisons between the Agreement and the Award.

[15] Upon analysis of the submitted rosters, it identified that certain employees under the Agreement would be worse off under the Agreement. The applicant was advised of this observation.

[16] Having regard to the reduced entitlements, the applicant was advised that the rates of pay under the Agreement did not appear to be an adequate compensation for the casual employees which the Agreement covers.

Undertakings

[17] Where the Commission has a concern that an agreement does not meet the requirements set out in s.186 and s.187 which includes that the agreement does not pass the BOOT, s.190 provides the employer with an opportunity to provide written undertakings acceptable to the Commission aimed at meeting those concerns 1.

[18] Accordingly, on 22 July 2015, the applicant was written to offering an opportunity to address concerns regarding the pay rates of the Agreement. Percentage pay rate increases to the Agreement were proposed.

[19] On 22 July 2015, the applicant provided undertakings with pay rate increases as proposed by the Commission. A pay rate table – Table A will replace the pay rate schedule in Schedule 2 of the Agreement.

[20] The undertaking provided by the applicant address the Commission’s concerns relating to the BOOT, and those raised by United Voice. Taking into account the higher rates of pay under the Agreement and the undertakings provided by the applicant, I am satisfied that the Agreement results in employees being better off overall under the Agreement.

[21] With respect to United Voice stating that the Agreement does not provide for fixed increases to the rates of pay, I note that there is no requirement under the Act for an Agreement to provide fixed increases to the rates of pay. As noted to the applicant, s.206 of the Act is such that the base rate of pay under an enterprise agreement must not be less than the modern award, and that if the agreement rate is less than the award rate, the Agreement has effect in relation to the employee as if the Agreement rate were equal to the Award rate. With regard to issues relating to employees being better off under the Agreement, the Agreement cannot be approved without meeting the requirements of the BOOT 2.

[22] United Voice has stated in its F18 that it wishes to be covered by the Agreement. In accordance with s.201(2) of the Act, I note that the Agreement covers this employee organisation.

[23] The undertaking provided by the applicant is taken to be a term of the Agreement. A copy of the undertaking is attached at Annexure B.

[24] I am satisfied that each of the requirements of ss.186, 187 and 188 of the Act as are relevant to this application for approval have been met.

[25] The Agreement is approved. In accordance with s.54(1), the Agreement will operate from 12 August 2015. The nominal expiry date of the Agreement is 3 years from the date of approval.

[26] This decision and undertaking should be brought to the attention of employees covered by the Agreement by the applicant.

COMMISSIONER

Annexure A

Annexure B

 1   BUPA Care Services v P & A Securities Pty Ltd as trustee for the D’Agostino Family Trust T/as Michel’s Patisserie Murwillumbah and others[2010] FWAFB 2762 at (49).

 2   Subject to any s.189(2) submission

Printed by authority of the Commonwealth Government Printer

<Price code G, AE415054  PR570004>