Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU) v Christie Tea Pty Ltd
[2010] FWA 10121
•3 DECEMBER 2010
[2010] FWA 10121 |
|
STATEMENT AND RECOMMENDATION |
Fair Work Act 2009
s.739 - Application to deal with a dispute
Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU)
v
Christie Tea Pty Ltd
(C2010/5546)
FOOD, BEVERAGE AND TOBACCO MANUFACTURING AWARD 2010
(ODN AM2008/37) [MA000073]
Food, beverages and tobacco manufacturing industry | |
COMMISSIONER HAMPTON | ADELAIDE, 3 DECEMBER 2010 |
Alleged dispute about any matters arising under the modern award.
Introduction and background
[1] This matter involves an application by the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (the AMWU) pursuant to s.739 of the Fair Work Act 2009 (the Act). The respondent employer is Christie Tea Pty Ltd (Christie).
[2] The application concerns a dispute regarding two aspects of the Food, Beverage and Tobacco Manufacturing Award 2010 (the modern award); being:
- Clause 13.4 Casual conversion to full-time and part-time employment (the casual conversion matter); and
- Clause 30.2 Ordinary hours of work - day workers (the hours of work matter).
[3] Having convened a conference of the parties and heard their respective positions, it has been agreed that I would issue a statement setting out the issues and some observations about the likely operation of the modern award. This is being done to assist the parties in their attempts to resolve the matters in dispute. In that light, I am not determining the matters at this stage.
[4] I do not intend to outline the detailed positions advanced, however I have had regard to them in making this statement. I also note that I have been provided by both parties with some material on a confidential basis. By agreement between the parties, I have had regard to that material, although it is by definition, untested.
[5] It is agreed between the parties that the modern award applies to Christie and the employees concerned.
[6] I will deal with each of the matters in dispute.
The casual conversion matter
[7] The modern award provides relevantly as follows:
“13.4 Casual conversion to full-time or part-time employment
(a) A casual employee, other than an irregular casual employee, who has been engaged by a particular employer for a sequence of periods of employment under this award during a period of six months, thereafter has the right to elect to have their contract of employment converted to full-time or part-time employment if the employment is to continue beyond the conversion process.
(b) Every employer of such an employee must give the employee notice in writing of the provisions of clause 13.4 within four weeks of the employee having attained such period of six months. The employee retains their right of election under clause 13.4 if the employer fails to comply with clause 13.4(b).
(c) Any such casual employee who does not within four weeks of receiving written notice elect to convert their contract of employment to full-time or part-time employment is deemed to have elected against any such conversion.
(d) Any casual employee who has a right to elect under clause 13.4(a), on receiving notice under clause 13.4(b) or after the expiry of the time for giving such notice, may give four weeks’ notice in writing to the employer that they seek to elect to convert their contract of employment to full-time or part-time employment, and within four weeks of receiving such notice the employer must consent to or refuse the election but must not unreasonably so refuse.
(e) Once a casual employee has elected to become and been converted to a full-time or part-time employee, the employee may only revert to casual employment by written agreement with the employer.
(f) If a casual employee has elected to have their contract of employment converted to full-time or part-time employment in accordance with clause 13.4(d), the employer and employee must, subject to clause 13.4(d), discuss and agree on:
(i) which form of employment the employee will convert to, being full-time or part-time; and
(ii) if it is agreed that the employee will become a part-time employee, the number of hours and the pattern of hours that will be worked, as set out in clause 12—Part-time employment.
(g) An employee who has worked on a full-time basis throughout the period of casual employment has the right to elect to convert their contract of employment to full-time employment and an employee who has worked on a part-time basis during the period of casual employment has the right to elect to convert their contract of employment to part-time employment, on the basis of the same number of hours and times of work as previously worked, unless other arrangements are agreed on between the employer and employee.
(h) Following such agreement being reached, the employee converts to full-time or part-time employment.
(i) Where, in accordance with clause 13.4(d) an employer refuses an election to convert, the reasons for doing so must be fully stated to and discussed with the employee concerned and a genuine attempt made to reach agreement.
(j) By agreement between the employer and the majority of the employees in the relevant workplace or a section or sections of it, or with the casual employee concerned, the employer may apply clause 13.4(a) as if the reference to six months is a reference to 12 months, but only in respect of a currently engaged individual employee or group of employees. Any such agreement reached must be kept by the employer as a time and wages record. Any such agreement reached with an individual employee may only be reached within the two months prior to the period of six months referred to in clause 13.4(a).
(k) For the purposes of clause 13.4, an irregular casual employee is one who has been engaged to perform work on an occasional or non-systematic or irregular basis.
13.5 An employee must not be engaged and re-engaged to avoid any obligation under this award.”
[8] I note that this provision was incorporated by the then Australian Industrial Relations Commission (the AIRC) into some modern awards, including this one, on the basis that it represented an existing industry standard (at least with the national system). 1 Accordingly, the purpose and intent of the provision should be considered in light of the AIRC decision which led to the clause being applied within the manufacturing sector more broadly.2
[9] The employer has a reasonable number of employees who were eligible under clause 13.4 to seek to convert and of those, four employees have made an election as contemplated by clause 13.4(d) of the modern award. Christie has refused the election requests and in essence the dispute here is whether the employer has unreasonably done so.
[10] It is reasonably clear that clause 13.4 of the modern award creates an expectation that a casual employee, who qualifies to make an election to convert to either full or part-time employment will be accommodated by their employer unless there are reasonable grounds to refuse that election. That is, it is the policy of modern award to encourage and facilitate the conversion of eligible casuals to full and part-time positions.
[11] In this case, the grounds relied upon by Christie to reject the elections involve a combination of concerns about the loss of “mutual” flexibility associated with the existing casual employment arrangements and the introduction of differential employment arrangements amongst a group of otherwise casual employees performing the same work. Further, the employer points to the nature of the business which involves undertaking supply contracts with various retailers whereby demand fluctuates and is dependent upon the renewal of the contract themselves.
[12] It is likely that any converting employees would in this workplace become part-time employees, and amongst other matters, Christie seeks to rely upon some of the “restrictions” surrounding part-time work within the modern award, including those set out in clause 12.3, 12.4 and 12.8 as follows:
“12. Part-time employment
12.1 An employee may be engaged to work on a part-time basis involving a regular pattern of hours which average less than 38 ordinary hours per week.
12.2 A part-time employee must be engaged for a minimum of three consecutive hours a shift. In order to meet their personal circumstances, a part-time employee may request and the employer may agree to an engagement for less than the minimum of three hours.
12.3 Before commencing part-time employment, the employee and employer must agree in writing:
(a) on the hours to be worked by the employee, the days on which they will be worked and the commencing and finishing times for the work; and
(b) on the classification applying to the work to be performed in accordance with Schedule B—Classification Structure and Definitions.
12.4 The terms of the agreement in clause 12.3 may be varied by consent in writing.
12.5 The agreement under clause 12.3 or any variation to it under clause 12.4 must be retained by the employer and a copy of the agreement and any variation to it must be provided to the employee by the employer.
12.6 Except as otherwise provided in this award, a part-time employee must be paid for the hours agreed on in accordance with clauses 12.3 and 12.4.
12.7 The terms of this award will apply pro rata to part-time employees on the basis that ordinary weekly hours for full-time employees are 38.
12.8 A part-time employee who is required by the employer to work in excess of the hours agreed under clauses 12.3 and 12.4 must be paid overtime in accordance with clause 33—Overtime.
12.9 Where the part-time employee’s normal paid hours fall on a public holiday prescribed in the NES and work is not performed by the employee, such employee must not lose pay for the day. Where the part-time employee works on the public holiday, the part-time employee must be paid in accordance with clauses 30.2(f), 31.5 and 33.8.”
[13] The AMWU contends that all of the above concerns are either unfounded or insufficient to establish a reasonable basis to reject the elections from the employee’s affected.
[14] If the matter is to be determined, the substance of those concerns would of course need to be assessed on the basis of evidence and weighed against the reasonable expectation that eligible casual employees will be able to elect to become weekly hired employees. In particular, the degree to which the actual operational and employment hours must fluctuate given all of the circumstances of the modern award and this business, would become the major focus.
[15] I would observe that given the relative size of the business, the fact that the employees concerned have several years of regular and systematic employment, and the fact that the nature of the supply contracts is not in itself unusual, Christie would need to demonstrate something well beyond inconvenience and the need to introduce some additional administrative structure in order to justify its position.
[16] I would also observe that the operation of the part-time provisions of the modern award is a factor to be considered, depending upon the extent of variation in the actual work demands from week to week. This would also become more of an issue if a significant number of employees were to convert to part-time employment and could also lead to the number of hours being specified for any part-time employees being less than might otherwise have been the case.
[17] In relation to the employees, the discipline that would be required in terms of the regularity of work and leave arrangements would also need to be taken into account.
[18] The parties should consider all of the above considerations in their further discussions. This would include how, if there are to be any conversions, the other employees are to be affected given the operation of the modern award.
The hours of work matter
[19] The modern award provides relevantly as follows:
“30.2 Ordinary hours of work—day workers
(a) Subject to clause 30.5, the ordinary hours of work for day workers are an average of 38 per week but not exceeding 152 hours in 28 days.
(b) The ordinary hours of work may be worked on any day or all of the days of the week, Monday to Friday. The days on which ordinary hours are worked may include Saturday and Sunday subject to agreement between the employer and the majority of employees concerned. Agreement in this respect may also be reached between the employer and an individual employee.
(c) The ordinary hours of work are to be worked continuously, except for meal breaks, at the discretion of the employer between 6.00 am and 6.00 pm. The spread of hours (6.00 am to 6.00 pm) may be altered by up to one hour at either end of the spread, by agreement between an employer and the majority of employees concerned or, in appropriate circumstances, between the employer and an individual employee.
(d) Any work performed outside the spread of hours must be paid for at overtime rates. However, any work performed by an employee prior to the spread of hours which is continuous with ordinary hours for the purpose, for example, of getting the plant in a state of readiness for production work is to be regarded as part of the 38 ordinary hours of work.
(e) Where agreement is reached in accordance with clause 30.2(b), the rate to be paid to a day worker for ordinary time worked between midnight on Friday and midnight on Saturday is 150% and/or the rate to be paid to a day worker for ordinary time worked between midnight on Saturday and midnight on Sunday is 200%.
(f) A day worker required to work on a public holiday must be paid for a minimum of three hours work at the rate of 250%. The 250% rate must be paid to the employee until the employee is relieved from duty.”
[20] The dispute concerns clause 30.2(c) and in particular whether there was an agreement to extend the ordinary hours by 45 minutes to 6.45pm as contemplated by that provision; and if so, whether the individual agreement with employees was also required.
[21] Clause 8 of the modern award also provides as follows:
8. Facilitative provisions
8.1 Agreement to vary award provisions
(a) This award also contains facilitative provisions which allow agreement between an employer and employees on how specific award provisions are to apply at the workplace or section or sections of it. The facilitative provisions are identified in clauses 8.2, 8.3 and 8.4.
(b) The specific award provisions establish both the standard award condition and the framework within which agreement can be reached as to how the particular provisions should be applied in practice. Facilitative provisions are not to be used as a device to avoid award obligations nor should they result in unfairness to an employee or employees covered by this award.
8.2 Facilitation by individual agreement
(a) The following facilitative provisions can be utilised by agreement between an employer and an individual employee:
Clause number | Provision |
12.2 | Minimum engagement for part-time employees |
12.4 | Variation to hours of part-time employment |
13.2 | Minimum engagement for casuals |
30.7 | Make-up time |
32.5 | Meal break |
33.1(d) | Time off instead of payment for overtime |
33.3 | Rest period after overtime |
33.9 | Rest break |
(b) The agreement reached must be kept by the employer as a time and wages record.
8.3 Facilitation by majority or individual agreement
(a) The following facilitative provisions can be utilised by agreement between the employer and the majority of employees in the workplace or a section or sections of it, or the employer and an individual employee:
Clause number | Provision |
13.4(j) | Period for casual election to convert |
28.1(b) | Payment of wages |
30.2(b) | Ordinary hours of work for day workers on weekends |
30.2(c) | Variation to the spread of hours for day workers |
30.5(a) | Methods of arranging ordinary working hours |
31.2 | Variation to the spread of hours for shiftworkers |
32.1(b) | Working in excess of five hours without a meal break |
37.2 | Substitution of public holidays |
(b) Where agreement is reached between the employer and the majority of employees in the workplace or a section or sections of it to implement a facilitative provision in clause 8.3(a), the employer must not implement that agreement unless:
(i) agreement is also reached between the employer and each individual employee to be covered by the facilitative provision; and
(ii) the agreement reached is kept by the employer as a time and wages record.
(c) Where no agreement has been sought by the employer with the majority of employees in accordance with clause 8.3(b), the employer may reach agreement with individual employees in the workplace or a section or sections of it and such agreement binds the individual employee provided the agreement reached is kept by the employer as a time and wages record and provided the agreement is only with an individual employee or a number of individual employees less than the majority in the workplace or a section or sections of it.
8.4 Facilitation by majority agreement
(a) The following facilitative provisions may only be utilised by agreement between the employer and the majority of employees in the workplace or a section or sections of it:
Clause number | Provision |
30.3(c) | Ordinary hours of work, continuous shiftworkers |
30.4(b) | Ordinary hours of work, non-continuous shiftworkers |
30.5(c) | 12 hour days or shifts |
31.5(d) | Public holiday shifts |
34.2 | Conversion of annual leave to hourly entitlement |
34.9(g) | Annual close down |
(b) Where agreement is reached with the majority of employees in the workplace or a section or sections of it to implement a facilitative provision in clause 8.4(a), that agreement binds all such employees provided the agreement reached is kept by the employer as a time and wages record.
(c) Additional safeguard
[8.4(c)(i) substituted by PR994527 from 01Jan10]
(i) An additional safeguard applies to:
Clause number | Provision |
28 | Payment of wages |
30.3(c) | Ordinary hours of work, continuous shiftworkers |
30.4(b) | Ordinary hours of work, non-continuous shiftworkers |
(ii) The additional safeguard requires that the unions which have members employed at an enterprise covered by this award must be informed by the employer of the intention to use the facilitative provision and be given a reasonable opportunity to participate in the negotiations regarding its use. Union involvement in this process does not mean that the consent of the union is required prior to the introduction of agreed facilitative arrangements at the enterprise.
8.5 Majority vote at the initiation of the employer
A vote of employees in the workplace or a section or sections of it which is taken in accordance with clauses 8.3(a) and 8.4 to determine if there is majority employee support for the implementation of a facilitative provision, is of no effect unless taken with the agreement of the employer.
[22] I am not in a position to resolve whether there was an agreement with the majority of relevant employees, at least as contemplated on the face of clause 30.2(c), given the factual dispute between the parties. On either case, there was a discussion with the relevant employees and an indication of a lack of opposition to the proposed extension of ordinary hours.
[23] The AMWU contend that the employees did not make an informed decision. Christie contend that the employees genuinely agreed to the change. I note that the material provided to me in confidence by the parties raises perspectives that support these competing contentions however I am unable to resolve the matter given the untested status of that material.
[24] It is clear on both cases that the “agreement” was not formalised in any way and that there have not been individual agreements made with the individuals concerned. This latter point is potentially important given the dispute between the parties as to the relevance and import of clause 8 of the modern award.
[25] The AMWU contend that the concept of an agreement pursuant to clause 30.2(c) is specifically cited in clause 8.3 and that clause 8.3(b) requires that any such agreement must not be implemented unless an agreement is also reached with each individual employee and the agreement is kept as a time and wages record. Christie contend that clause 8.3 only applies to agreements that go beyond the scope of clause 30.2(c), that is, beyond the stated potential one hour extension to the spread of hours.
[26] In my view, this is not a simple matter. On face value, when clause 8 is considered as a whole, it is reasonably clear that it is intended to deal with the facilitation provided by clause 30.2(c). This is the ordinary and natural interpretation of the provisions when read as a whole. However, given that the variation to the spread of hours is classified under clause 8.3, this means that even though clause 30.2(c) contemplates both collective (majority) agreement and individual agreement, in reality, if this approach is correct, the provisions only contemplate individual agreement. This would be an unusual, albeit conceivable, outcome.
[27] On the other hand, the approach contended by Christie is problematic. If clause 8 only applied to variations beyond that already contemplated by clause 30.2(c), this would mean that any change could be individually agreed without parameters and limitations. This is an unlikely outcome, particularly given the Individual Flexibility Agreement provisions in clause 7 of the modern award and the strong safeguards that operate in that context.
[28] I would observe that in any event, the likely approach to the meaning of clause 30.2(c) is that some formality in the majority agreement was required, such that it was confirmed in writing in some manner and kept as a time and wages record. There is a risk that even on the approach urged by Christie to both the facts and the meaning of the modern award, the apparent endorsement by the employees was not an agreement within that meaning.
[29] There are a series of options open to the parties to clarify the matter for the future, including conducting a process that involves the confirmation of the intentions of the employees in an open and transparent manner.
[30] The meaning and application of the modern award does however require resolution and there are also a number of options available to the parties in that regard. These would include having the matter arbitrated by Fair Work Australia under the dispute resolution procedure of the modern award or seeking a determination of the law by a Court of competent jurisdiction.
[31] Further, the parties might consider making an Enterprise Agreement under the Act. Provided that the overall package of wages and conditions met the Better Off Overall Test of s.193 of the Act (and other approval requirements), mutually satisfactory, legal binding and clear outcomes to these two issues could be agreed and implemented within this workplace.
RECOMMENDATION
THAT the parties consider their positions in the light of the above observations and meet with a view to advancing a resolution on the outstanding matters.
[32] Liberty to apply the have the matter relisted has been granted to both parties.
COMMISSIONER
1 Request from the Minister for Employment and Workplace Relations—28 March 2008 - Award Modernisation [2008] AIRCFB 1000 - paragraph [51], 19 December 2008.
2 Metal, Engineering and Associated Industries Award, 1998 - Part I AIRC Print T4991, (2001) 105 IR 27.
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