AustralianSuper Pty Ltd T/A AustralianSuper
[2024] FWC 2957
•24 OCTOBER 2024
| [2024] FWC 2957 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
AustralianSuper Pty Ltd T/A AustralianSuper
(AG2024/4042)
SUPERPARTNERS ENTERPRISE AGREEMENT 2023
| Banking finance and insurance industry | |
| COMMISSIONER YILMAZ | MELBOURNE, 24 OCTOBER 2024 |
Application for an order relating to instruments covering new employer and transferring employees
This decision concerns an application by AustralianSuper Pty Ltd T/A AustralianSuper (AustralianSuper or the Applicant) for orders pursuant to s.318 of the Fair Work Act 2009 (the Act).
The application is made in respect of employees who are currently covered by the Superpartners Enterprise Agreement 2023[1] (the Superpartners Agreement) and will transfer employment to the Applicant.
The Applicant is internalising its member complaints resolutions function which an external provider has previously been providing. As part of this process, on 9 October 2024, the Applicant made offers of employment, which were all accepted, to employees currently covered by the Superpartners Agreement (the Transferring Employees). The Applicant seeks those transferring employees covered by the Agreement to be covered by the AustralianSuper Pty Ltd Enterprise Agreement 2023-2026[2] (AustralianSuper Agreement) on commencement of employment, and that the Agreement, as a transferring instrument[3], does not cover it as the new employer.
The orders sought by the Applicant are as follows:
a)Pursuant to s318(1)(a) of the Fair Work Act 2009 (Cth), the Superpartners Enterprise Agreement 2023, as a transferrable instrument, does not, and will not cover AustralianSuper Pty Ltd and its employees previously employed by Superpartners Pty Ltd in the AustralianSuper Outbound Contact Centre Team; and
b)Pursuant to s318(1)(b) of the Fair Work Act 2009 (Cth), the AustralianSuper Pty Ltd Enterprise Agreement 2023-2026 does, or will, cover the employees of AustralianSuper Pty Ltd previously employed by Superpartners Pty Ltd in the AustralianSuper Outbound Contact Centre Team; and
c)Pursuant to s318(4) of the Fair Work Act 2009 (Cth), these orders shall have effect on and from [date of FWC’s order].
The application was accompanied by a witness statement made by Elizabeth Slavin, Head of Organisational Development & Planning at AustralianSuper. The Finance Sector Union of Australia’s support of the application was confirmed in an email sent to my Chambers on 18 October 2024. Accordingly, in these circumstances I have determined the matter on the papers without the need for a hearing.
Legislation
Section 318(3) of the Act sets out the matters the Commission must have regard to in determining if the orders sought should be granted
Section 318 provides as follows:
“318 Orders relating to instruments covering new employer and transferring employees
Orders that FWA may make
(1) FWA may make the following orders:
(a)an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;
(b)an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.
Who may apply for an order
(2) FWA may make the order only on application by any of the following:
(c)the new employer or a person who is likely to be the new employer;
(d)a transferring employee, or an employee who is likely to be a transferring employee;
(e)if the application relates to an enterprise agreement—an employee organisation that is, or is likely to be, covered by the agreement;
(f)if the application relates to a named employer award—an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (b).
Matters that FWA must take into account
(3) In deciding whether to make the order, FWA must take into account the following:
(a) the views of:
(i)the new employer or a person who is likely to be the new employer; and
(ii)the employees who would be affected by the order;
(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 an enterprise agreement—the nominal expiry date of the agreement;
(d) whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace;
(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;
(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;
(g) the public interest.
Restriction on when order may come into operation
(4)The order must not come into operation in relation to a particular transferring employee before the later of the following:
(a) the time when the transferring employee becomes employed by the new employer;
(b) the day on which the order is made.
Background
The Applicant is establishing a new Early Resolutions team as part of its member complaints resolutions function. This function was previously provided by an external service provider, Australian Administration Services Pty Limited (AAS). In May 2024, AAS was acquired by the Mitsubishi UFJ Trust & Banking Corporation and is now known as MUFG Pension & Market Services (MUFG). The services that AAS currently provides to AustralianSuper includes contact centre services, which in part are performed by MUFG’s AustralianSuper Outbound Contact Centre Team (MUFG Outbound Team). Superpartners Pty Ltd (Superpartners) are an entity within MUFG.
On 9 October 2024, AustralianSuper offered employment to eight employees in MUFG Outbound Team. The employees all accepted AustralianSuper’s offer of employment. Three of these eight employees are covered by the Superpartners Agreement.
The transferring employees are expected to cease employment with Superpartners and commence with AustralianSuper on 28 October 2024, where they will continue to perform substantially the same work. Furthermore, AustralianSuper has arranged with AAS (as an associated entity of Superpartners), that they will have the beneficial use of certain AAS (or another associated entity of Superpartners) assets that relate to and are to be used by the Transferring Employees to perform the Transferring Work.
Transferrable instrument
Section 311 of the Act sets out when a transfer of business occurs. On the evidence before me, I am satisfied that there will be a transfer of business from Superpartners (old employer) to AustralianSuper (new employer) within the meaning of s.311(1) of the Act. Employees of the old employer will be terminated, they will be employed by the new employer within three months, the transferring work is the same or substantially the same, and there is a connection between the old employer and the new employer.
Section 318(3)(a) – the views of the new employer and the employees who would be affected by the order
The Applicant submits that the proposed orders would ensure certainty and consistency in relation to its employment arrangements and submitted that the AustralianSuper Agreement would overall afford greater financial and non-financial benefits to employees than those contained in the Superpartners Agreement.
The Applicant held an information session on 12 September 2024 covering the key terms and conditions of the AustralianSuper Agreement. They provided the employees a copy of the information session slide pack, position descriptions for roles, a copy of the AustralianSuper Agreement and a link to an expression of interest. AustralianSuper then made offers of employment to the three employees covered by the Superpartners Agreement. In the offer letters, the Applicant outlined its desire for the Transferring Employees to be covered by the AustralianSuper Agreement cover the employment and its intention to make this application, however the offer of employment was not conditional upon this.
Following this, employment contracts were issued to the Transferring Employees on 9 October 2024, all were subsequently signed and returned. The Applicant submits that none of the Transferring Employees raised concerns regarding the AustralianSuper Agreement covering their employment rather than their current enterprise agreement.
The Finance Sector Union of Australia (FSU) is the relevant union covered by the AustralianSuper Agreement and have industrial coverage of the Transferring Employees. At the time of making this application, the Applicant had provided information to the Finance Sector Union of Australia (FSU) but had not received confirmation from the FSU that they support the application. The Applicant subsequently emailed my Chambers on 18 October 2024, copying in the FSU, advising that they had received confirmation from the FSU that the FSU are supportive of the application.
These factors have, in my view, a legitimate basis, and are factors that weigh in favour of granting the application.
Section 318(3)(b) – whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment
The Applicant submits that if the order sought is made, transferring employees will not be disadvantaged in relation to their terms and conditions of employment, and for existing employees of the Applicant there will be parity in terms and conditions.
The Applicant submits that the AustralianSuper Agreement overall provides equal or more favourable terms and conditions than the Superpartners Agreement. The AustralianSuper Agreement contains more beneficial terms in respect of:
a)salaries / rates of pay;
b)superannuation contributions of 13% (for those covered by the classification tables in the AustralianSuper Agreement, which includes all Transferring Employees);
c)36 ordinary hours per week;
d)17.5% annual leave loading, paid in addition to salary;
e)blended working is available to all colleagues, without the need to apply;
f)paid personal leave of 12 days in the second year of service, and 14 days per year in the third and each subsequent year of service;
g)up to 104 weeks parental leave (including 20 weeks’ paid), with no qualifying periods or primary/ secondary carer distinction, and superannuation is paid at the colleague’s full-time rate for up to 104 weeks from the commencement of parental leave;
h)in addition to annual leave, employees are entitled to five additional days of paid leave per year, which can be taken at any time and for any purpose;
uncapped paid family and domestic violence leave;
j)two days paid leave per year to perform volunteer work for charities/community organisations;
k)up to 6 weeks paid and 46 weeks unpaid gender affirmation leave; and
l)income protection insurance for up to two years under AustralianSuper’s policy.
The Superpartners Agreement is more beneficial than the AustralianSuper Agreement in respect of:
a)for Grades 1 to 5, if a part time employee under the Superpartners Agreement is directed to work overtime at hours which are outside their agreed hours, they would be entitled to overtime payments, whereas under the AustralianSuper Agreement they would, unless otherwise agreed, be entitled to time off in lieu rather than overtime payments;
b)in the case of redundancy, if an employee chooses to accept redeployment to a role at a reduced salary they are entitled to a 2 month trial period, compared to a 2 week consideration period under the AustralianSuper Agreement.
Despite the more favourable terms in the Superpartners Agreement, the AustralianSuper Agreement on balance provides more beneficial terms and transferring employees are not disadvantaged by the order.
In my view, the above considerations weigh in favour of making the order sought.
Section 318(3)(c) – if the order relates to an enterprise agreement—the nominal expiry date of the agreement
I note that the nominal expiry date of the Superpartners Agreement is 31 July 2026. I also note that the nominal expiry date of the AustralianSuper Agreement is 30 June 2026. Accordingly, I consider this factor to be neutral.
Section 318(3)(d) – whether the transferable instrument would have a negative impact
on the productivity of the new employer’s workplace
The Applicant submits that if the proposed orders were not made, they would be required to divert more resources towards administering and managing the different terms and conditions of employment applying to a very small portion of its workforce, adding unnecessary complexity to existing payroll and human resources functions. This would result in inefficiencies for AustralianSuper’s operations and increased risks of non-compliance.
The Applicant further submits that the disparity between the terms and conditions which apply to transferring and non-transferring employees may result in conflict and discontent amongst employees who perform the same work alongside each other. This would inevitably have a negative impact on morale and productivity.
Having considered the differences in conditions, application of the Superpartners Agreement would in my view have a negative impact on productivity in the workplace.
Section 318(3)(e) – whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer
The Applicant submits that it would incur an economic disadvantage as a result of the additional administrative burden and complexity associated with administering and managing different terms and conditions of employment applying to a small portion of its workforce.
Further, the Applicant submits a significant up-front investment of time and cost would be necessary to reconfigure AustralianSuper’s existing payroll and human resources systems to cater for a separate enterprise agreement.
I consider that the Applicant, being the new employer will suffer economic disadvantage should it be required to apply the transferrable instrument.
Section 318(3)(f) – the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer
The Applicant submits there is little business synergy between the Superpartners Agreement, which applies to employees providing administration services to a number of MUFG's superannuation fund clients, and the AustralianSuper Agreement which is specific to AustralianSuper’s operations, workplace environment, culture and values.
I am satisfied that the requirement of s.318(3)(f) is met based on a consideration of the materials before me.
Section 318(3)(g) – public interest
The Applicant submits that transferring employees by way of the proposed orders be in the public interest. Having regard to all the material before me, I am not of the view there are public interest reasons that weigh against making the orders sought.
Conclusion
Pursuant to s.318(3)(a) I have taken into account the views of the Applicant and the views of the employees who would be affected by the order based on the material before me. For the purposes of s.318(3)(b) of the Act I am satisfied that the transferring employees will not be disadvantaged in relation to their terms and conditions of employment.
I have also taken into account the material provided by the Applicant in support of its
application and the matters set out in s.318(3) of the Act. I am satisfied the materials provided
by the Applicant, when considered against the matters set out in s.318(3) of the Act, support
the making of the order.
An order[4] to this effect will be issued together with this decision.
COMMISSIONER
[1] AE520877.
[2] AE522079.
[3] Per s.313.
[4] PR780578.
Printed by authority of the Commonwealth Government Printer
<AE520877 PR780575>
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