BCS Infrastructure Support Pty Limited T/A Daifuku Oceania

[2024] FWC 3155

[2024] FWC 3155

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.318 - Application for an order relating to instruments covering new employer and transferring employees

BCS Infrastructure Support Pty Limited T/A Daifuku Oceania

(AG2024/4128)

Airport operations
COMMISSIONER DURHAM	BRISBANE, 15 NOVEMBER 2024

Application for orders relating to instruments covering new employer and transferring employees

1. An application has been made by BCS Infrastructure Support Pty Limited T/A Daifuku Oceania (Daifuku Oceania/the Applicant) to the Fair Work Commission (the Commission) for an order pursuant to s.318 of the Fair Work Act 2009 (the FW Act).

Orders Sought

1. The Applicant is seeking orders that under s. 318 of the Act:

1. Pursuant to s.318(1)(a), that the Queensland Airports Limited Enterprise Agreement 2023 will not cover BCS Infrastructure Support Pty Limited t/as Daifuku Oceania (Daifuku Oceania) or any transferring employee, as defined within Part 2-8 of the Act, whose employment will transfer to Daifuku Oceania from Gold Coast Airport Pty Ltd on or about 21 October 2024 (Transferring Employee).  

2. In accordance with s.318(4), that Order 1 shall operate in relation to each of the Transferring Employees on and from the date on which a Transferring Employee commences employment with Daifuku Oceania.

1. In support of this Application, the Applicant relies on:

1. A statement from Ms Kate Roberts, Senior Lawyer Workplace Relations of the Applicant dated 18 October 2024.

Background

1. Daifuku Oceania is an employer in the logistics and automation industry and provides end-to-end solutions for a variety of industries, including airports and airlines. Daifuku Oceania’s employees engaged in this work are primarily employed in technical trades roles and covered by the Manufacturing and Associated Industries and Occupations Award 2020 (Manufacturing Award).  

1. Pursuant to an agreement between Daifuku Oceania and Gold Coast Airport Pty Ltd (GCA) (CAN 077 200 821), GCA will outsource its control room and aerobridge operations to Daifuku Oceania (Outsourcing). The work to be performed by Daifuku Oceania as a result of the Outsourcing is monitoring the Baggage Handing System (BHS) control room, and aerobridge first response, inspection and maintenance (Outsourced Work).  

1. Daifuku Oceania currently employs 3 employees on site at Gold Coast Airport who are engaged in operations and maintenance roles that involve diagnosing and rectifying technical issues with the BHS, and maintaining associated BHS mechanical and electrical systems. These employees are all covered by the Manufacturing Award. To perform the Outsourced Work, Daifuku Oceania will need to employ additional employees.  

1. As part of the Outsourcing, Daifuku Oceania has made offers of employment to six (6) employees of GCA (Transferring Employees). Where the Transferring Employees transfer employment to Daifuku Oceania in connection with the Outsourcing, there will be a transfer of business within the meaning in s.311(1) and (4) of the FW Act.

1. GCA is one of four (4) employers covered by the Queensland Airports Limited Enterprise Agreement 2023 (QAL Agreement) in respect of employees engaged in the Administrative Services, Technical Services, Grounds and Maintenance, and Aviation Services streams (the other 3 being Townsville Airport Pty Ltd, Mount Isa Airport Pty Ltd, and Longreach Airport Pty Ltd). The QAL Agreement is underpinned by the Airport Employees Award 2020 (Airport Award) and the classifications in the QAL Agreement largely mirror the classifications in the Airport Award.

1. The Transferring Employees are engaged in the roles of Terminal Systems and Maintenance Officers and are covered by the QAL Agreement in the Technical Services stream.  

1. The offers of employment to the Transferring Employees are expected to be effective from on or about 21 October 2024. On transfer to Daifuku Oceania, the Transferring Employees will perform the Outsourced Work.

1. The existing Daifuku Oceania employees (non-transferring employees) will also perform the Outsourced Work. Those employees will be employed in technical trades roles covered by the Manufacturing Award.  

1. On 23 October 2024 my Chambers sought the views of the Transferring Employees as well as the Australian Manufacturing Workers' Union (AMWU) and Communications, Electrical, Plumbing Union (CEPU) regarding this application.

1. To date, neither the Transferring Employees or the Unions mentioned above have expressed a view supporting the application or otherwise.

Statutory provisions

1. Section 318 of the Act relates to the application sought by the Applicant. Section 318(3) of the Act sets out those matters the Commission must have regard to in determining if the orders sought should be granted.

1. Section 318 provides as follows:

318 Orders relating to instruments covering new employer and transferring employees

Orders that the FWC may make

(1)   The FWC 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)   The FWC may make the order only on application by any of the following:

(a)   the new employer or a person who is likely to be the new employer;

(b)   a transferring employee, or an employee who is likely to be a transferring employee;

(c)   if the application relates to an enterprise agreement—an employee organisation that is, or is likely to be, covered by the agreement;

(d)   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 the FWC must take into account

(3)   In deciding whether to make the order, the FWC 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.

Consideration

Matters that the FWC must take into account

318(3)(a)(i) – views of Daifuku Oceania

1. Daifuku Oceania’s preference is that, on transfer of employment to Daifuku Oceania, the Transferring Employees are covered by the Manufacturing Award to ensure that employees performing similar work will have terms and conditions which are the same in respect of hours of work, rostering, loadings and penalty rates, and which promote a more harmonious workplace and facilitates compliance.

318(3)(a)(ii) – views of the employees who would be affected by the order

1. The F40 states that each employee to which the proposed Orders sought by this application will apply has been offered employment with Daifuku Oceania, and has been provided a letter setting out details of the employment offer from Daifuku Oceania, which includes:

(a) a link to the Manufacturing Award;

(b) an offer of employment which preserves key benefits from the QAL Agreement; and

(c) information on who to contact if they have any questions or concerns about what is being proposed.

1. Daifuku Oceania has also:

(a) informed GCA, Townsville Airport Pty Ltd, Mount Isa Airport Pty Ltd, and Longreach Airport Pty Ltd, being the employers covered by the Agreement; and

(b) informed the AMWU and the CEPU which are covered by the QAL Agreement and was the bargaining representatives for the Transferring Employees in respect of bargaining for that Agreement.

1. Additionally, Ms Robert’s statement provides Ms Sasha Blair (Daifuku Oceania's Executive General Manager, People & Culture) and Ms Therese Revell (Daifuku Oceania's Executive General Manager, Client Operations) met with the Transferring Employees on 25 September 2024 at Gold Coast Airport. In that meeting, they informed the Transferring Employees that Daifuku Oceania proposed to make this Application, and provided the Transferring Employees with an information pack. No issues were raised with Daifuku Oceania by the Transferring Employees in response.

318(3)(b) – whether the affected employees will be disadvantaged by the order

1. The Applicant states that the Transferring Employees will not be disadvantaged by the Orders sought as their terms and conditions of employment with Daifuku Oceania will maintain key QAL Agreement benefits.

1. Ms Roberts statement provides that Daifuku Oceania has agreed to retain material monetary benefits currently provided to Transferring Employees (including their rates of pay) as set out in their employment contracts. A copy of the employment contract was annexed to Ms Robert’s statement, which notes Daifuku Oceania’s commitment to maintain the additional entitlements in the QAL Agreement as follows:

Maintained benefits

Additional personal/carer's leave:

In addition to what is provided for in the NES, you are entitled to an additional 3 days personal/carer's leave on full pay in the second and following years of service. This additional entitlement to leave does not accumulate from year to year.

Additional personal leave:

In addition to your entitlements to personal leave at full pay provided above, you are entitled to the following amount of full pay personal leave for absence due to personal illness or injury:

·5 days (accruing from 3rd to 12th months) inclusive of the first year of service;

·5 days in the second and following years of service.

This additional personal leave is not available for use within the first year of service.
This additional personal leave is not available for carer's leave or bereavement leave purposes as provided for under this clause.

You may elect, with the consent of Daifuku Oceania, to take this additional personal leave at half pay.

The leave accrues progressively throughout the year.

Additional compassionate leave

In addition to what is provided for in the NES, you are entitled to an additional day of paid leave on each occasion of the death of a member of your immediate family or household. For the purposes of this entitlement, immediate family includes foster parents, step-parents and parents-in-law.

Additional paid family and domestic violence leave

In addition to the 10 days of paid leave provided for under the NES, you are entitled to two days of paid family and domestic violence, totalling 12 days in a twelve month period.

Paid family and domestic violence leave:

(a) Is available in full at the start of each twelve (12) month period of your employment; and
(b) does not accumulate from year to year; and
(c) is available in full to part-time and casual Employees.

Taking of Paid Family and Domestic Violence Leave

The Employee may take paid family and domestic violence leave as:

(a) a single continuous twelve (12) day period or such longer period as agreed between the Employee and the employer; or
(b) separate periods of one (1) or more days each; or
(c) any separate periods to which the Employee and the employer agree, including periods of less than one day.

This leave will be in addition to existing leave entitlements and may be taken as consecutive or single days or as a fraction of a day and all reasonable requests will be approved.

Special leave

At Daifuku Oceania's discretion, you may may be granted special paid leave up to a maximum of 3 days per annum in order to respond to any occasion of a personal or domestic occurrence that could not reasonably have been anticipated.

You will only be entitled to this special leave where no other type of leave is available, or you do not have sufficient accrued leave entitlements.

Leave so granted must be recognised as service for all purposes.
At Daifuku Oceania's discretion, you may be granted special leave without pay for a maximum of 12 months. Any such period of leave will count as service for all purposes, provided that it is not in excess of 22 days within a 12 month period. Where the period of special leave exceeds 22 days, the entire period of leave will not count as service including for the purposes of any leave accrual.

Redundancy entitlements

If your position is made redundant in accordance with the NES, you will subsequently be entitled to redundancy pay in accordance with the table below:
Period of continuous service

Period of continuous service  Redundancy pay  
At least 1 year but less than 2 years  5 weeks
At least 2 years but less than 3 years   7 weeks
At least 3 years but less than 4 years  8 weeks
At least 4 years but less than 5 years  9 weeks
At least 5 years but less than 6 years   11 weeks
At least 6 years but less than 7 years  12weeks
At least 7 years but less than 8 years  14weeks
At least 8 years but less than 9 years   15 weeks
At least 9 years but less than 10 years   17 weeks
At least 10 years  13 weeks

If you are redeployed to a lower paid position and are made redundant within one year of such redeployment the redundancy payment shall be calculated on the basis of the rate of pay for the previous position held.

In the event that the entitlement to redundancy pay as prescribed by the NES is increased during the life of this Agreement, you will receive the greater of the redundancy pay prescribed in the table above or the NES entitlement plus an additional week of redundancy pay.

a) A statement of service will be issued to you if you are made redundant, indicating your length
of service and that you were made redundant by the Company.
b) Upon notification of termination by redundancy, you will be provided with two to four weeks of Outplacement Support through an external provider, who will assist in transitioning you into new employment.

Transition to retirement

To assist in providing certainty for both you and the Employer, the following arrangements to support your transition into Genuine Retirement are specified:

(a) If you wish to transition to Genuine Retirement you may resign from your employment by providing 6 months of notice of termination. This period of notice may include a maximum of 3 months of accrued leave (annual leave and/or long service leave), which will conclude by your effective date of termination.
(b) Notwithstanding the above, if you wish to transition to Genuine Retirement you may resign from your employment by providing 9 months of notice of termination. This period of notice may include a maximum of 6 months of accrued leave (annual leave and/or long service leave), which will conclude by your effective date of termination.

Once you have provided notice of termination in accordance with the above and this has been accepted by the Employer, both parties commit to honouring the effective date of termination. The Employer also commits to approving the final period of leave period requested, which will conclude by your effective date of termination.

318(3)(c) – nominal expiry date

1. The nominal expiry date of the QAL Agreement is 30 June 2027.

318(3)(d) – negative impact on productivity

1. Daifuku Oceania submit they will need to ensure compliance with two sets of terms and conditions in respect of nine (9) employees, which results in a significant administrative and compliance burden on it.

1. The application of different instruments to the nine (9) employees is likely to discourage effective integration as between the Transferring Employees and non-transferring employees, in circumstances where the small team environment requires co-operative relationships.

318(3)(e), (f) – economic disadvantage and degree of business synergy

1. Daifuku Oceania submit that they seek to achieve fairness as between its employees and promoting integration of the Transferring Employees by a single set of minimum terms and conditions.

1. The Applicant further submit that there is no business synergy between the QAL Agreement and the Manufacturing Award, including by reference to the following:

(a) Ordinary hours of work – Day Workers:

(i) Under the Manufacturing Award, ordinary hours of work for day workers can be rostered 6am to 6pm and on any day of the week by agreement with employees. 

(ii) Under the QAL Agreement, ordinary hours of work for day workers may be rostered between 6:30am to 6:30pm, Monday to Friday, in shifts of up to 12 hours with a maximum of 10 ordinary hours in a shift.  Only shift workers may work ordinary hours on weekends. 

(b) Hours of work – shiftworkers:

(i) Under the Manufacturing Award, employees may be rostered to work day  work or shift work according to their roster.  Shiftworkers may be rostered on afternoon shift (any shift finishing after 6.00 pm and at or before midnight), or night shift (any shift finishing after midnight and at or before 8.00 am), which attract a loading of 15%.  

(ii) The QAL Agreement does not distinguish between afternoon and night shifts.  Rather, shiftworkers may be rostered on shifts finishing after 6.00 pm and at or before 6:30am (which attract a loading of 115%) or on shifts starting at or after 6pm and finishing at or before 8.00 am (which attracts a loading of 130% in some circumstances.  

(c) Breaks

(i) The Manufacturing Award provides for a 20-minute unpaid meals break where working more than 5 hours for a day worker, and a 10-minute paid rest break for any shift.  Continuous shiftworkers are provided a 20 minute paid meal break as rostered, and a 10 minute rest break for any shift.

(ii) The QAL Agreement has different break entitlements depending on the employee’s role and what shifts they are working.  The break entitlements of the Transferring Employees are likely to be an unpaid meal break of 30 minutes when working at least 5 hours, to be taken between the 4^th and 6^th hours of work, and a paid 10-minute rest break only if working more than 4 hours, plus another paid 10-minute break only if working 8 or more hours.

(d) Overtime

(i) Under the Manufacturing Award, employees other than continuous shiftworkers are paid overtime at the rate of 150% for the first 3 hours and 200% thereafter.  Day workers are paid overtime on Saturday at the rate of 150% for the first 3 hours and 200% thereafter, with a minimum payment of 4 hours.  Sunday overtime is paid at 200% with a minimum payment of 3 hours.

(ii) Under the QAL Agreement, certain employees are not paid overtime separately as a result of having annualised rates of pay.  Otherwise, for day workers, the overtime penalty rate is 150% for the first 3 hours and 200% thereafter, with all work on Sunday at 200% (day workers cannot be rostered to work ordinary hours on Sundays). For shiftworkers, the overtime penalty rate is 150% for the first 3 hours, and 200% thereafter, with all weekend work outside of an employee’s ordinary hours paid at 200%.  

(e) Weekend Penalties

(i) Under the Manufacturing Award, day workers who work ordinary hours on weekends are paid at the rate of 150% for all ordinary hours on Saturday, and 200% for all ordinary hours on Sundays. Shiftworkers are paid 150% of the ordinary hourly rate for shifts on Saturday, and 200% for all ordinary hours where the majority of the shift falls on a Sunday.

(ii) Under the QAL Agreement, day workers cannot be rostered to work ordinary hours on weekends.  Shiftworkers who work ordinary hours on weekends are paid at 150% for all hours on Saturday, and 200% for all hours on a Sunday with a minimum payment of 3 hours.  

(f) Classifications

(i) Under the Manufacturing Award, employees are classified according to a 14-level classification structure that progresses according to trade skill, qualification and experience.

(ii) Under the QAL Agreement, employees are classified according to multiple streams with between 3 or 4 levels per stream. 

(iii) There is no alignment between the classification structure in the Manufacturing Award and the classification structure in the QAL Agreement.

(g) Pay Cycles

(i) Consistent with the Manufacturing Award, Daifuku Oceania pays its employees weekly.  Under the QAL Agreement, employees are paid fortnightly.  To maintain a single pay run, Daifuku Oceania would need to transition its employees working at Gold Coast Airport to fortnightly pay, which would then be inconsistent with the pay cycle for comparable employees at other sites.

318(3)(g) – public interest

1. Daifuku Oceania submit it is in the public interest to have harmonious workplaces which are facilitated by having one industrial instrument applying to employees performing similar work. Having different industrial instruments can increase the prospects of non-compliance because of the administrative issues associated with managing multiple industrial instruments for employees performing similar work.

1. I have reviewed the application documentation, and the accompanying material provided including the statement provided. These documents outline the circumstances which have given rise to the application. Further, the submissions contained in the application address the relevant legislative requirements which are asserted to provide for a proper basis for the making of the orders sought.

1. Having considered the material before me, including the commitment of Daifuku Oceania to maintain the listed conditions of employment for transferring employees I am satisfied that the requirements of s.318 of the Act have been met. Orders will be issued with this Decision.

COMMISSIONER

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