BGIS Pty Ltd T/A BGIS

[2021] FWC 2946

[2021] FWC 2946

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees

BGIS Pty Ltd T/A BGIS
(AG2021/5207)

COMMISSIONER PLATT ADELAIDE, 21 MAY 2021

Application for orders in relation to a transfer of business.

Background

[1] BGIS Pty Ltd (BGIS) has made an application to the Fair Work Commission pursuant to s.318 of the Fair Work Act 2009 (Cth) (the Act) for an order in relation to a transfer of business.

[2] Section 318 of the Act empowers the Commission to make an order that a transferable industrial instrument that would likely cover a new employer will not do so, and that an enterprise agreement or named employer award that covers the new employer will cover the transferring employee.

[3] Sections 318(2) of the Act provides who may make such an application and s.318(3) of the Act details what the Commission must take into account.

[4] BGIS owns and operates businesses that provide a variety of management and workplace services.

[5] HBF Health Limited (HBF) has recently outsourced two front of house/building entry receptionist roles to BGIS. The two employees currently filling those roles (the Transferring Employees) are covered by the HBF Enterprise Agreement 2018 – 2021. BGIS advises there will be a transfer of business as contemplated by s.311 of the Act.

[6] Employment has been offered to the Transferring Employees conditioned on the success of the Application before me.

[7] BGIS seeks an order that transferring employees will not be covered by the HBF Enterprise Agreement 2018 – 2021 (HBF Agreement) but will be covered by the Clerks – Private Sector Award 2020 (the Award).

[8] Upon lodgement, the Applicant provided a witness statement from each of the Transferring Employees in support of the transfer attached to their Form F40 Application.

Statutory provisions

[9] Section 318 of the Act provides as follows:

“318 Orders relating to instruments covering new employer and transferring employees

Orders that FWC may make

(1) 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) 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 FWC must take into account

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

[10] I also note that the exercise of the discretion given to the Fair Work Commission in this regard is also undertaken within the objects of this Part of the Act, which states as follows:

“309 Object of this Part

The object of this Part is to provide a balance between:

(a) the protection of employees’ terms and conditions of employment under enterprise agreements, certain modern awards and certain other instruments; and

(b)the interests of employers in running their enterprises efficiently;

if there is a transfer of business from one employer to another employer.”

[11] This application was filed prior to the transfer of business taking place. BGIS appears to fall within the requirements of s.318(2) and is thus able to make the Application.

[12] I now turn to the matters I am required to take into account.

Section 318(3)(a)(i): the views of BGIS as the new employer

[13] BGIS have made this application on grounds as set out in the Application Form F40 completed by Mr Ross Levin of Mills Oakley.

[14] These grounds relate to their proposal that the Applicant would not employ the Transferring Employees without the orders sought from the Commission, and as such the Applicant views them as essential.

Section 318(3)(a)(ii): the views of the Transferring Employees

[15] The application was accompanied by witness statements from Ms Frances Gray and Ms Vicki Nicol (the Transferring Employees). Both Transferring Employees have indicated through their statements that whilst the terms and conditions of the HBF Agreement are more beneficial than those under the Award, they would prefer to be covered by the Award. This position seems to be held mainly due to the redundancy payment they are to receive from HBF, and the acknowledgement that without the order they would be forced into unemployment and uncertainty.

[16] It is noted that the Transferring Employees’ statements are identical, and it is acknowledged that BGIS drafted the statements for the Transferring Employees to sign. In saying this, I am satisfied that the statements reflect the true position of the Transferring Employees in relation to the Application.

Section 318(3)(b): Whether any affected employees would be disadvantaged by the order

[17] The Applicant has submitted that whilst the Transferring Employees will be worse off under the Award than the HBF Agreement, the Transferring Employees will not be disadvantaged by the order, because without the order, the Transferring Employees will not be employed by BGIS.

[18] I am satisfied, especially taking into account the witness statements of the Transferring Employees, that given the conditional nature of the employment offer, the Transferring Employees would not be disadvantaged by the order.

Other considerations

[19] I regard ss.318(3)(c)-(f) as neutral considerations. The nominal expiry date of the HBF Agreement is 31 October 2021, which neither favours nor prejudices the Application. Given the conditional nature of the offer of employment, factors such as the productivity on BGIS’ workplace, any economic disadvantage and the degree of synergy between the transferable instrument and any workplace instrument are redundant.

[20] The Applicant submitted that there are no public interest considerations that are relevant to this Application.

Conclusions and orders

[21] Having regard to all of the considerations raised by s.318 of the Act, I am satisfied that I should exercise my discretion to grant the application and to make an order.

[22] The Order 1 to be issued in conjunction with this decision is to the effect that the HBF Enterprise Agreement 2018-2021 will not cover BGIS and its employees who have transferred from HBF and that BGIS and the Transferring Employees will be covered by the Clerks – Private Sector Award 2020.

[23] The Order will apply on and from 21 May 2021.

COMMISSIONER

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