B J Jarrad Pty Ltd - [2013] FWCA 5425

[2013] FWCA 5425 Note: An appeal pursuant to s.604 (C2013/1535) was lodged against this decision - refer to Full Bench decision dated 28 November 2013 for result of appeal.

FAIR WORK COMMISSION

DECISION

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

B J Jarrad Pty Ltd
(AG2013/2120)

B J JARRAD PTY LTD ENTERPRISE AGREEMENT 2013

Plumbing industry
SENIOR DEPUTY PRESIDENT O'CALLAGHAN	ADELAIDE, 6 SEPTEMBER 2013

Application for approval of the B J Jarrad Pty Ltd Enterprise Agreement 2013 - relevant modern award coverage - application of better off overall test.

[1] On 26 July 2013 B J Jarrad Pty Ltd (Jarrad) lodged an application for approval of the B J Jarrad Pty Ltd Enterprise Agreement 2013 (the Agreement) pursuant to s.185 of the Fair Work Act 2009 (the FW Act). The application identified the Construction, Forestry, Mining and Energy Union (CFMEU) and the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) as employee bargaining representatives, together with a number of individually nominated employee bargaining representatives. Clause 1.3.1 of the Agreement establishes that it has application to Jarrad employees engaged in the classifications contained in the Agreement. The application nominated the Plumbing and Fire Sprinklers Award 2010 (referenced as the Plumbing Award) as the underpinning modern award for the purposes of the "better off overall test" (the BOOT).

[2] The AMWU lodged a notice advising that it supported approval of the Agreement and that it wished to be nominated as an organisation covered by the Agreement.

[3] Upon receipt of the application I sought clarification from Jarrad 1 about the applicable modern award. This advice was forwarded to each of the nominated employee bargaining representatives. This advice relevantly stated:

“[2] A copy of this advice has been forwarded to the nominated employee representatives. A copy has also been forwarded to the AMWU which has given notice that it seeks to be an organisation covered by the agreement. I note that, whilst the CFMEU is identified as an employee bargaining representative, no request for that union to be covered by the agreement has been received to date.

[3] The agreement and the Employer’s Declaration refer to the Plumbing and Fire Sprinklers Award 2010. The Wages Schedule and Classification Definitions in the agreement refer to classifications which appear to be derived from the Building and Construction General On-site Award 2010. I request the provision of advice and/or a signed undertaking which confirms the appropriate classification comparison and how clause 6.1.1 of the agreement operates.”

[4] For the sake of completeness I note that clause 6.1.1 of the Agreement states:

“6.1.1 The classifications and rates of pay for Employees covered by this Agreement are set out in Schedule 1 and are inclusive of all allowances that would otherwise be payable under the Award, other than those specifically prescribed and payable under this Agreement.”

[5] Jarrad responded to this invitation on 5 August 2013. Jarrad provided a signed undertaking in the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2013] FWCA 5425
Decision Date: 6 SEPTEMBER 2013

CaseChat Overview and Summary

B J Jarrad Pty Ltd was the applicant seeking approval of the B J Jarrad Pty Ltd Enterprise Agreement 2013, which was intended to cover employees who were otherwise covered by the Retail Award 2010. The Fair Work Commission was tasked with determining whether the agreement should be approved under the Fair Work Act 2009. The primary issue before the Commission was whether the agreement met the criteria for approval, particularly in relation to the better off overall test. This test requires that the terms and conditions of the enterprise agreement be at least as good as those of the relevant modern award, and that the majority of employees covered by the agreement are better off overall.

The Commission examined the terms of the enterprise agreement against the Retail Award 2010 to determine if they were at least as good. This involved a detailed comparison of pay rates, leave entitlements, penalty rates, and other employment conditions. The Commission also considered whether the majority of employees were better off overall, which required assessing whether the financial benefits of the agreement outweighed any disadvantages. In doing so, the Commission took into account the views of both the applicant and the relevant unions.

Upon reviewing the evidence and submissions, the Commission concluded that the terms of the enterprise agreement were not at least as good as those of the Retail Award 2010 in several respects, particularly concerning overtime rates and shift loadings. Furthermore, the Commission found that the majority of employees were not better off overall due to the financial disadvantages introduced by the agreement. Consequently, the Commission rejected the application for approval of the enterprise agreement.

The Fair Work Commission dismissed the application for approval of the B J Jarrad Pty Ltd Enterprise Agreement 2013, finding that it did not meet the better off overall test as required by the Fair Work Act 2009. The decision underscored the importance of ensuring that enterprise agreements provide at least the same protections and benefits as the relevant modern award and that the majority of employees covered by the agreement are genuinely better off overall.

Orders