BWA Group Services Pty Ltd T/A Bankwest
[2022] FWC 2087
•15 AUGUST 2022
| [2022] FWC 2087 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
BWA Group Services Pty Ltd T/A Bankwest
(AG2022/3267)
| Banking finance and insurance industry | |
| DEPUTY PRESIDENT BEAUMONT | PERTH, 15 AUGUST 2022 |
Application for an order relating to instruments covering new employer and transferring employees
This matter involves an application by BWA Group Services Pty Ltd T/A Bankwest (the Applicant) under s 318 of the Fair Work Act 2009 (Cth) (the Act). The Applicant has applied for orders from the Fair Work Commission (the Commission) relating to one of its employees, Mr Richard Jones (the Transferring Employee), who previously worked for the Commonwealth Bank of Australia (CBA). The Transferring Employee is covered by the Commonwealth Bank Group Enterprise Agreement 2020 (the CBG Agreement).[1] Having initially made an application under ss 318(1)(a) and 318(1)(b) of the Act, the Applicant sought not to press its application in respect of the order under s 318(b). It follows that this decision deals only with the Applicant’s application in respect of the order applied for under s 318(1)(a).
The Applicant is a provider of a full range of banking services.[2] In or around 2008, the Applicant was acquired by CBA.[3] It operates as part of the CBA group, consisting of CBA and its subsidiaries.[4]
On or around 7 February 2019, the Transferring Employee commenced employment for CBA in the role of Graphic Designer within the Enterprise Services Business Unit.[5] After that role was made redundant, the Transferring Employee was redeployed into a temporary role as a Multimedia Designer in CBA’s Retail Banking Services Business Unit, commencing on 20 January 2020.[6] In that temporary role, the Transferring Employee provided services exclusively to the Applicant pursuant to a secondment arrangement between the Applicant and CBA;[7] he did not provide services to CBA.[8] Immediately following the termination of his employment for CBA, the Transferring Employee commenced employment for the Applicant in the position of Multimedia Designer in Chief Operations Office.[9]
It is uncontroversial that there has been a transfer of business as that phrase is understood by reference to s 311(1) of the Act. Briefly stated, the Transferring Employee:
a) ceased employment with CBA on or by 26 December 2021;[10]
b) commenced employment with the Applicant on 27 December 2021,[11] this being within the three months prescribed by s 311(1)(b);
c) performs the same or substantially the same work for the Applicant as he did for CBA;[12] and
d) is now employed by the Applicant and as observed, the Applicant and CBA are associated entities for the purposes of s 50AAA of the Corporations Act 2001 (Cth) therefore giving rise to the requisite connection between the old employer and new employer referred to in s 311(1)(d) (see also s 311(6) of the Act).[13]
The Applicant now seeks the following orders under s 318(1) of the Act:
1) Pursuant to s 318(1)(a), that the CBG Agreement does not, and will not cover:
a.the Applicant; and
b.the Transferring Employee in respect of his employment with the Applicant in the role of Multimedia Designer within the Retail Banking Services team;
2) Should the Commission determine it is appropriate to make these orders, they would come into effect on and from the later of:
a.the commencement of the Transferring Employee’s employment with the Applicant; or
b.the date the orders are made;
in accordance with s 318(4) of the Act.[14]
The Applicant accepts that the effect of the Commission making the proposed order under s 318(1)(a) of the Act will be to revert the Transferring Employee to the coverage and application of the Banking Finance and Insurance Award 2020 (the Award)[15] from the date of the Order.[16]
The application contained detailed grounds and submissions, and was accompanied by a witness statement of Ms Rosaria Chillemi, Executive Manager-HR of the Applicant, together with several attachments, which in short contend that which is listed:
a)The Applicant seeks the proposed orders because:
i.it desires all of its employees to be subject to consistent industrial arrangements and terms and conditions of employment;
ii.it seeks to avoid inequity arising out of the Transferring Employee being covered by the CBG Agreement and other employees performing similar functions and with similar levels of seniority as the Transferring Employee being covered by the Award (and/or any successor modern award);
iii.the CBG Agreement was negotiated and tailored to CBA and its employees and operations, not the Applicant’s; and
iv.it wishes to minimise the financial costs and operational issues associated with implementing and managing the CBG Agreement. [17]
b)Ms Chillemi gave evidence that other related key reasons for the Applicant seeking the proposed orders are to maintain productivity of the Applicant’s brand and marketing operations, to avoid employee dissatisfaction and the diminution of morale due to inconsistent terms and conditions of employment between employees, and to encourage a harmonious, single workplace.[18]
c)The CBG Agreement commenced operation on 27 August 2021 and reached its nominal expiry date on 30 June 2022.[19]
d)The Transferring Employee falls within the Award’s coverage.[20]
e)The Applicant’s enterprise agreement, the Bankwest Enterprise Agreement 2019, [21] does not cover the Transferring Employee.[22]
f)Prior to the Transferring Employee accepting an offer of employment for the Applicant, the Applicant undertook a process of consulting with the Transferring Employee about the orders the Applicant presently seeks from the Commission. Following an engagement session conducted by Ms Chillemi,[23] the provision of copies of the CBG Agreement, Award and a document comparing the entitlements provided for under the two instruments,[24] and an opportunity to ask questions, the Transferring Employee recorded his support in a questionnaire for the proposition that the CBG Agreement would not cover him if his employment transferred from CBA to the Applicant (as it later did).[25]
g)Whilst noting various advantages and disadvantages associated with being covered by the Award instead of the CBG Agreement,[26] there will be no overall disadvantage to the Transferring Employee’s terms and conditions of employment should the Commission make the orders sought.[27] The Transferring Employee will be better off overall under the Award than under the CBG Agreement because of the differences in:
i.the spread of ordinary hours (7.00 am to 7.00 pm Monday to Friday, and 8.00 am to 12 noon Saturday under the Award, as opposed to 7.00am to 10.00pm on weekdays, and 8.00am to 8.00pm on weekends under the CBG Agreement);
ii.public holiday penalty rates (double time and a half under the Award, as opposed to double time under the CBG Agreement);
iii.afternoon shiftwork loadings (20% loading under the Award, as opposed to 17.5% under the CBG Agreement);
iv.the application of vehicle allowances (a flat rate per week under the Award, as opposed to a payment per kilometre under the CBG Agreement);
v.the first aid allowances ($16.15 per week under the Award, as opposed to $13.90 under the CBG Agreement);
vi.the provision of an on-call/standby allowance under the Award, as opposed to no such allowance under the CBG Agreement; and
vii.the Award providing for far fewer circumstances in which an employee may be directed to take annual leave than under the CBG Agreement.[28]
h)The application of the CBG Agreement to the Transferring Employee would lead to operational inefficiencies and negatively impact on the Applicant’s business by:
i.causing payroll and other operational and administrative issues because of the need to administer the CBG Agreement as well as the Award;
ii.leading to a heightened chance of errors in payments, consequently resulting in additional administrative burden; and
iii.causing a diminution in morale because of disparities in employees’ terms and conditions of employment, leading to decreased productivity and causing unnecessary disruption.[29]
The Applicant would suffer economic disadvantage if the CBG Agreement continued to apply to the Transferring Employee because of additional expenses resulting from the need to administer the CBG Agreement, reconfigure payroll and rostering systems, and provide additional training to staff to ensure compliance with the CBG Agreement.[30]
j)There is no business synergy between the CBG Agreement and the Award, considering the following factors:
i.Although the Applicant is a wholly owned subsidiary of CBA, the institutions are operationally and financially distinct.
ii.The CBG Agreement was negotiated by, and tailored to, CBA and its employees. By contrast, employees of the Applicant in corresponding roles and seniority levels to the Transferring Employee are covered by the Award.
iii.There are substantial differences between the CBG Agreement and the Award, including inconsistencies in relation to allowances and loadings, penalty rates, and other administrative benefits.[31]
k)Granting the order would be in the public interest because it would reduce the complexity of the Applicant’s employment arrangements and support the efficient and effective operation of the Applicant’s business, upon which the public relies.[32]
l)The Applicant is not aware of any opposition to the orders sought.[33]
Having received no objection to the application being determined on the papers, I proceeded to determine the matter by reference to and with reliance upon the grounds, submissions and other materials provided with the application.
Section 318 of the Act sets out the circumstances in which an order such as that sought by the Applicant may be made by the Commission:
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.
I have reviewed the application documentation and the accompanying material. These documents outline the factual 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 a proper basis for the making of the order sought.
As observed, I am satisfied this circumstance is a transfer of business as understood by reference to s 311 and that the CBG Agreement is a transferable instrument as described in s 312(1)(a). If the order under s 318(1)(a) was not made, then I consider by virtue of s 313(1)(a) the CBG Agreement would cover the Transferring Employee notwithstanding his employment with the Applicant.
It is evident that the Transferring Employee will not be disadvantaged overall by the proposed order in relation to his terms and conditions of employment. If I were to make the order sought, the Transferring Employee will be covered by the Award, which has been shown to be overall advantageous compared to those terms and conditions of employment the Transferring Employee currently enjoys under the CBG Agreement. The Applicant referred to the dissatisfaction and negative impact on morale that may arise where the Transferring Employee is performing the same duties working side-by-side with existing employees and yet, would be afforded different minimum entitlements. I consider the submission is not absent merit. As to whether the Applicant would incur significant economic disadvantage, the assertion is unable to be sustained on the evidence, however, I accept that the absence of such orders may result in additional administrative and managerial burden in light of Ms Chillemi’s evidence, therefore impacting upon the Applicant’s productivity.
I have considered all the factors set out in s 318(3) and have concluded that it is appropriate and not contrary to the public interest to make the Order[34] sought under s 318(1)(a). In accordance with s 318(4), the Order shall have effect from the date the Order is made.
DEPUTY PRESIDENT
Printed by authority of the Commonwealth Government Printer
<AE512211 PR744570>
[1] [2021] FWCFB 4074; AE512211; PR731594.
[2] Witness Statement of Rosaria Chillemi, [6].
[3] Ibid [7].
[4] Ibid [8].
[5] Ibid [9].
[6] Ibid [11], [13] – [14].
[7] Ibid [16] – [17].
[8] Applicant’s Form F40, [2.3(7)].
[9] Ibid [17], Exhibit RC-1.
[10] Applicant’s Form F40, [2.3(6)]; Witness Statement of Rosaria Chillemi, [15].
[11] Applicant’s Form F40, [2.3(6)]; Witness Statement of Rosaria Chillemi, [17], [26(a)].
[12] Fair Work Act 2009 (Cth) s 311(1)(c); Applicant’s Form F40, [2.3(10)]; Witness Statement of Rosaria Chillemi, [26(b)].
[13] Witness Statement of Rosaria Chillemi, [26(c)].
[14] Applicant’s Form F40, [2.2]; Email from Kat Eather (Special Counsel, Corrs Chambers Westgarth) to the Chambers of Deputy President Beaumont, 11 August 2022.
[15] MA000019.
[16] Email from Kat Eather (Special Counsel, Corrs Chambers Westgarth) to the Chambers of Deputy President Beaumont, 11 August 2022.
[17] Applicant’s Form F40, [2.3(11)], [2.3(18)].
[18] Witness Statement of Rosaria Chillemi, [31].
[19] Ibid [20].
[20] Ibid [24].
[21] [2019] FWCA 7421; AE505891; PR713762.
[22] Witness Statement of Rosaria Chillemi, [25].
[23] Ibid [32] – [33].
[24] Ibid [34], Exhibits RC-2, RC-3 and RC-4.
[25] Ibid [36], Exhibit RC-6; Applicant’s Form F40 [2.3(13)].
[26] Applicant’s Form F40 [2.3(16)] – [2.3(17)].
[27] Ibid [2.3(14)]; Witness Statement of Rosaria Chillemi, [38] – [40].
[28] Witness Statement of Rosaria Chillemi, [40].
[29] Applicant’s Form F40 [2.3(20)]; ibid [45] – [47].
[30] Applicant’s Form F40 [2.3(22)] – [2.3(23)]; Witness Statement of Rosaria Chillemi, [49].
[31] Applicant’s Form F40 [2.3(24)] – [2.3(29)]; Witness Statement of Rosaria Chillemi, [50] – [51].
[32] Applicant’s Form F40 [2.3(30)].
[33] Ibid [2.3(31)]; Witness Statement of Rosaria Chillemi, [53].
[34] AE512211; PR744733.
Printed by authority of the Commonwealth Government Printer
<AE512211 PR744570>
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