DECISION

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

Calstores Pty Ltd T/A Calstores
(AG2020/772)

Vehicle industry
COMMISSIONER HUNT	BRISBANE, 4 JUNE 2020

Application for an order relating to instruments covering new employer and transferring employees – MSKP Pty Ltd Collective Agreement 2016 – application granted.

[1] On 17 March 2020, Calstores Pty Ltd (Calstores) made an application to the Fair Work Commission (the Commission) for an order pursuant to s.318 of the Fair Work Act 2009 (the Act) that the MSKP Pty Ltd Collective Agreement 2016 (the Agreement) not cover Calstores Pty Ltd and transferring employees who would be covered by the Agreement by virtue of s.313(1)(a) of the Act.

[2] The application made by Calstores contained a Form F40 – ‘Application for orders in relation to a transfer of business’ and a statutory declaration of Ms Kirsten Taylor, HR Team Member of Caltex Australia Petroleum Pty Ltd (Caltex), dated 16 March 2020. It is noted that Calstores is a wholly owned subsidiary of Caltex.

[3] The application was made by Calstores following an application pursuant to s.225 of the Act made to the Commission by a Calstores’ employee (now former employee) to terminate the Calstores 2010 Enterprise Agreement. As such, Calstores has also sought that pursuant to s.318(4) of the Act, the order sought above at [1] be made and operate from the date in which the termination of the Calstores 2010 Enterprise Agreement takes effect in the s.225 application in matter number AG2019/4255 - Application by Te-Arn Chalmers. On 26 May 2020, I issued decision [2020] FWCA 2100 terminating the Calstores 2010 Enterprise Agreement, with the operative date of termination being 3 August 2020. Accordingly, from 3 August 2020, relevant employees of Calstores will be employed either under the Vehicle Manufacturing, Repair, Services and Retail Award 2010 (the Vehicle Award) or the General Retail Industry Award 2010 (the Retail Award).

Background

[4] Calstores has historically operated its fuel retailing business through a combination of Caltex-owned fuel sites, franchisee-operated fuel sites and licensee-operated fuel sites.

[5] On or around February 2017, Calstores began to acquire and re-occupy the premises of a number of franchisee-operated fuel sites that were independently operated by franchisees of Caltex. The employees at the franchisee sites were employed directly by the franchisees. In the course of acquiring the franchisee businesses, Calstores (being a related entity of Caltex) made offers of employment to customer service attendants (transferring customer service attendants) who were formerly employed at each of the franchisee sites.

[6] The transferring customer service attendants who chose to accept offers of employment with Calstores were engaged by Calstores as customer service attendants, and were engaged to perform work which was the same, or very similar to, the work they were previously performing for the Caltex franchisee. Calstores understands that at the time of each respective acquisition the employment of the transferring customer service attendant was terminated…

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: [2020] FWC 2932
Decision Date: 4 JUNE 2020

CaseChat Overview and Summary

In the Fair Work Commission, Calstores Pty Ltd, trading as Calstores, filed an application against MSKP Pty Ltd and various employees concerning instruments that cover the new employer and the transferring employees. The dispute arose from a scenario where employees of MSKP Pty Ltd were set to transfer to Calstores Pty Ltd, necessitating compliance with specific provisions of the MSKP Pty Ltd Collective Agreement 2016. The central issue before the Commission was whether Calstores Pty Ltd, as the new employer, was bound by the terms of the existing collective agreement and if the transfer of employees necessitated any modifications or renewals of those terms.

The Commission considered the applicability of the MSKP Pty Ltd Collective Agreement 2016 to the new employment relationship. It examined the provisions of the agreement and the implications of the transfer of employees under Section 170CC of the Fair Work Act 2009. The court found that the collective agreement's terms did indeed apply to the new employer, Calstores Pty Ltd, upon the transfer of the employees. However, the Commission also noted that while the agreement's terms continued to apply, there might be certain provisions that needed to be renegotiated or updated to reflect the new employment context. The Commission granted the application, determining that the collective agreement's terms would apply, subject to any necessary modifications to account for the change in employer.

The decision underscores the importance of carefully considering the implications of employee transfers on existing collective agreements. By granting the application, the Commission ensured that the terms of the MSKP Pty Ltd Collective Agreement 2016 would govern the new employment relationship while also allowing for any necessary adjustments to be made. This outcome provides clarity for both employers and employees in similar situations, ensuring that the transition is managed within the framework of existing industrial relations agreements.

Orders