Bowland Cranbourne Pty Ltd T/A Bowland Cranbourne

[2010] FWA 2953

[2010] FWA 2953

FAIR WORK AUSTRALIA

DECISION

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

Bowland Cranbourne Pty Ltd T/A Bowland Cranbourne
(AG2010/7870)

COMMISSIONER LEWIN MELBOURNE, 18 MAY 2010

Bowland Cranbourne Enterprise Agreement.

[1] An application has been made for approval of an enterprise agreement known as the Bowland Cranbourne Enterprise Agreement 2009 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by Bowland Cranbourne Pty Ltd. The Company operates a ten pin bowling business. The agreement is a single-enterprise agreement.

[2] The reference instrument for the purpose of determining whether or not the Agreement passes the better off overall test is the Amusement, Events and Recreation Award 2010. On reading the terms of the Agreement and the terms of the reference instrument I became concerned that the Agreement did not pass the better off overall test. On 13 April 2010 the application was listed for Hearing on 21 April 2010. The Hearing was adjourned at the request of the applicant on two occasions, and subsequently adjourned an additional week by the Tribunal until 17 May 2010.

[3] At the Hearing on 17 May 2010 Mr Francesco Mascardi appeared for the Company. The employees were not represented. At the Hearing I indicated to Mr Mascardi the concerns I had that the Agreement did not pass the better off overall test and identified the particular terms and conditions of employment provided for by the reference instrument which gave rise to those concerns. Mr Mascardi advised that he was aware of the likely issues of concern as a result of discussions with the industry association of employers. However, Fair Work Australia may approve an agreement with undertakings pursuant to s.190 of the Act. During the Hearing I suggested to Mr Mascardi undertakings in terms that, in my view, remedied the deficiencies identified in the Agreement passing the better off overall test.

[4] Whether undertakings are given is a matter for the consideration of the applicant Company. Upon consideration of the opportunity to offer undertakings, Mr Mascardi indicated that the Company was not prepared to give any undertakings. It was Mr Mascardi’s view that the giving of undertakings would not be commercially viable for the Company.

[5] I indicated to Mr Mascardi that, should he seek to have the Agreement approved without the giving of the abovementioned undertakings, he would need to satisfy the Tribunal either that the employees were better off overall under the terms of the Agreement, as compared to the reference instrument without the giving of undertakings, or that he could seek approval of the agreement on the grounds of exceptional circumstances and public interest under s.189 of the Act.

[6] During the Hearing, Mr Mascardi stated that he was aware of the particular issues raised by the Tribunal and conceded that employees would be better off overall under the terms of the reference instrument rather than the Agreement. I find accordingly for the purposes of this decision.

[7] Fair Work Australia may approve an Agreement that does not pass the better off overall test if it is satisfied that to do so would not be contrary to the public interest under s.189 which is set out below:

“189 FWA may approve an enterprise agreement that does not pass better off overall test—public interest test

Application of this section

(1) This section applies if:

(a) FWA is not required to approve an enterprise agreement under section 186; and

(b) the only reason for this is that FWA is not satisfied that the agreement passes the better off overall test.

Approval of agreement if not contrary to the public interest

(2) FWA may approve the agreement under this section if FWA is satisfied that, because of exceptional circumstances, the approval of the agreement would not be contrary to the public interest.

Note: FWA may approve an enterprise agreement under this section with undertakings (see section 190).

(3) An example of a case in which FWA may be satisfied of the matter referred to in subsection (2) is where the agreement is part of a reasonable strategy to deal with a short-term crisis in, and to assist in the revival of, the enterprise of an employer covered by the agreement.

Nominal expiry date

(4) The nominal expiry date of an enterprise agreement approved by FWA under this section is the earlier of the following:

(a) the date specified in the agreement as the nominal expiry date of the agreement;

(b) 2 years after the day on which FWA approved the agreement.

[8] During the Hearing Mr Mascardi was provided with an opportunity to make Submissions in support of approval of the Agreement under s.189 of the Act. Mr Mascardi submitted that the penalty rates and rest break provisions under the reference instrument would result in the Company potentially having to decrease its operating hours and that it would not operate on public holidays. If the Agreement were to be approved however, with the inferior terms and conditions of employment provided by the Agreement, these outcomes could be avoided.

[9] Having regard to the provision of ss.189(2) and (3) of the Act I cannot be satisfied that the reasons submitted in support of approval of the agreement constitute ‘exceptional circumstances’ or are part of a ‘reasonable strategy to deal with a short term crisis in, and to assist in the revival of, the enterprise’. In my view, the Agreement does not pass the better off overall test. I am unable to find that it would not be contrary to the public interest to approve an agreement which does not pass the better off overall test on the grounds advanced by the applicant. Moreover, I am satisfied that it would be contrary to the public interest to approve the Agreement in this matter on the grounds advanced. The possibility or even probability that the costs to the applicant company of the operation of the terms of the reference instrument, rather than the lesser costs of the inferior terms and conditions of the Agreement, might lead to a change in the hours of operation of the business conducted by the applicant cannot, in my view, as a matter of public interest, outweigh the usual application of the better off overall test. The better off overall test is a central feature of the Act in relation to the national system of Agreement making adopted by Parliament.

[10] The application is refused.

COMMISSIONER

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