Cement Australia Pty Limited T/A Cement Australia

[2024] FWC 1644

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

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

Cement Australia Pty Limited T/A Cement Australia

(AG2024/1838)

Cement and concrete products
COMMISSIONER HUNT	BRISBANE, 24 JUNE 2024

Application for an order relating to instruments covering new employer and transferring employees

On 27 May 2024, Cement Australia Pty Limited T/A Cement Australia (the Applicant / Cement Australia) made an application to the Fair Work Commission (the Commission) for an order pursuant to s.318(1)(a) of the Fair Work Act 2009 (the Act) that the Hanson Constructions Materials Pty Ltd South East Queensland Agitator, Cement Tanker and Tipper Drivers Enterprise Agreement 2023[1] (the Hanson Agreement) will not cover the Applicant and transferring employees from an old employer.

The Applicant is covered by the Cement Australia Transport Workers (South East Queensland) Enterprise Agreement 2022[2] (the Cement Australia Agreement) in respect of other employees.

The Applicant is the new employer of a number of employees previously employed by Hanson Construction Materials Pty Ltd and covered by the Hanson Agreement. The Applicant also seeks an order pursuant to s.318(1)(b) of the Act that the Cement Australia Agreement will cover transferring employees when they commence employment with the Applicant from 25 June 2024.

Transfer of business

Section 311 of the Act sets out when a transfer of business occurs:

“311 When does a transfer of business occur

Meanings of transfer of business, old employer, new employer and transferring work

(1) There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:

(a) the employment of an employee of the old employer has terminated;

(b) within 3 months after the termination, the employee becomes employed by the new employer;

(c) the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;

(d) there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).

Meaning of transferring employee

(2) An employee in relation to whom the requirements in paragraphs (1)(a), (b) and (c) are satisfied is a transferring employee in relation to the transfer of business.

Transfer of assets from old employer to new employer

(3) There is a connection between the old employer and the new employer if, in accordance with an arrangement between:

(a) the old employer or an associated entity of the old employer; and

(b) the new employer or an associated entity of the new employer;

the new employer, or the associated entity of the new employer, owns or has the beneficial use of some or all of the assets (whether tangible or intangible):

(c) that the old employer, or the associated entity of the old employer, owned or had the beneficial use of; and

(d) that relate to, or are used in connection with, the transferring work.

Old employer outsources work to new employer

(4) There is a connection between the old employer and the new employer if the transferring work is performed by one or more transferring employees, as employees of the new employer, because the old employer, or an associated entity of the old employer, has outsourced the transferring work to the new employer or an associated entity of the new employer.
New employer ceases to outsource work to old employer

(5) There is a connection between the old employer and the new employer if:

(a) the transferring work had been performed by one or more transferring employees, as employees of the old employer, because the new employer, or an associated entity of the new employer, had outsourced the transferring work to the old employer or an associated entity of the old employer; and

(b) the transferring work is performed by those transferring employees, as employees of the new employer, because the new employer, or the associated entity of the new employer, has ceased to outsource the work to the old employer or the associated entity of the old employer.

New employer is associated entity of old employer

(6) There is a connection between the old employer and the new employer if the new employer is an associated entity of the old employer when the transferring employee becomes employed by the new employer.”

Transferrable instrument

Section 312 of the Act details instruments that may transfer:

“312 Instruments that may transfer

Meaning of transferable instrument

(1) Each of the following is a transferable instrument:

(a) an enterprise agreement that has been approved by the FWC;

(b) a workplace determination;

(c) a named employer award.

Meaning of named employer award

(2) Each of the following is a named employer award:

(a) modern award (including a modern enterprise award) that is expressed to cover one or more named employers;

(b) a modern enterprise award that is expressed to cover one or more specified classes of employers (other than a modern enterprise award that is expressed to relate to one or more enterprises as described in paragraph 168A(2)(b)).

Note: Paragraph 168A(2)(b) deals with employers that carry on similar business activities under the same franchise.”

The Hanson Agreement is an enterprise agreement. The Hanson Agreement is therefore a transferrable instrument within the meaning of s.312(1)(a) of the Act.

Relevant legislation

The application seeks for the Commission to make an order under s.318 of the Act, which is set out below:

“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.”

Background

Cement Australia is a leading supplier of cementitious products and services in Australia. Heidelberg Materials subsidiaries Hanson Cement Holdings Pty Ltd and Hanson Australia Investments Pty Ltd (Hanson Australia) (50%) and Holcim subsidiary Holcim (Australia) Pty Limited (50%).

Hanson Australia and the employing entity Hanson Construction Materials Pty Ltd (Hanson) are both subsidiaries of Heidelberg Materials.

Hanson and Cement Australia are not associated entities.

Hanson employs Agitator, Cement Tanker and Tipper drivers to undertake product deliveries to its South East Queensland customers including to Hanson plants (Customer Deliveries work). Cement Australia employs drivers to undertake the cartage of cement, fly ash and products related to pneumatic discharge to its customers in South East Queensland locations.

Hanson and Cement Australia have agreed that Cement Australia will:

· accept the transfer of 11 Hanson tankers used to undertake the Customer Deliveries work (Tanker Assets), with ownership of the Tanker Assets to transfer to Cement Australia effective 25 June 2024; and

· take over from Hanson, the Customer Deliveries work (Transaction).

On 25 June 2024, following completion of the Transaction, the Customer Deliveries work will be performed by employees of the Applicant. The Tanker Assets will be used by Cement Australia and its employees, including for some of the Customer Deliveries work after 25 June 2024.

On 14 May 2024, the Applicant made offers of employment to certain employees of Hanson who perform the Customer Deliveries Work with employment with the Applicant commencing following completion of the Transaction, on 25 June 2024.

Amongst other things, those offers of employment;

· are on terms and conditions no less favourable overall, and in a number of matters, more beneficial than those of the Hanson Agreement;

· recognise continuous service with Hanson for all purposes; and

· informed employees that:

· the Applicant will be making an s.318 application to the Commission; and
· if the application was successful and the order sought was made, Cement Australia Agreement would apply to their employment with the Applicant; and
· if the application was not successful, the Hanson Agreement would continue to apply to their employment with the Applicant.

As at the date of the application, the Applicant has made seven offers of employment to relevant employees of Hanson and all seven of those employees have accepted the offer to commence employment on 25 June 2024.

The Applicant’s position is that whilst employed by Hanson, the Transferring Employees’ employment is covered by the Hanson Agreement. Pursuant to s.311 and 312 of the Act, upon commencing their employment with the Applicant, there will be a transfer of business, and the Hanson Agreement will become the transferable instrument that will apply to the Applicant and the Transferring Employees.

The Applicant seeks orders that:

· the Hanson Agreement will not cover the Applicant and the Transferring Employees; and

· the Cement Australia Agreement will cover the Transferring Employees who fall within its scope.

The views of the Applicant

The Applicant advised within its Form F40 Application that it wishes to ensure current and future employees of the Applicant who transport and deliver cement product in the South East Queensland region are covered by a common set of terms and conditions, which is currently achieved by the Cement Australia Agreement.

The Applicant seeks to standardise conditions so that all of its employees (the Transferring Employees and non-Transferring Employees) who are performing substantially the same work in the South East Queensland region are covered by the same industrial instrument, which will enable business synergy and mitigate the negative impact of productivity and work relationships of having to manage and administer multiple employment arrangements for employees performing the same / substantially the same work within the same employing entity.

Moreover, it is the Applicant’s view that by granting the Order, it will:

· create employment simplicity by having the one industrial instrument apply to existing employees of the Applicant in its South East Queensland operations as well as Transferring Employees;

· create operational synergies around standard shift duration, allowing for further operational efficiencies and removing the complexities associated with the regular set up of the planning grid;

· create cultural synergies and mitigate any disharmony within the workforce within the South East Queensland region and concerns from employees doing the same or similar work as to why two different sets of terms and conditions apply; and

· mitigate the need for additional and complex payroll standards and requirements.

The views of the employees who would be affected by the order

The Applicant provided the Transferring Employees an offer of employment setting out the various terms and conditions of employment to be covered, and a copy of the following documents, prior to acceptance:

· a document comparing the key terms of the Cement Australia Agreement against the key terms of the Hanson Agreement; and

· the Cement Australia Agreement.

A copy of the contract of employment template is extracted below:

“Dear [insert]

…

Your employment terms
The terms and conditions of your employment with Cement Australia are governed by:
· the Contract of Employment attached to this cover letter;
· the National Employment Standards (NES); and
· the applicable enterprise agreement, or its replacement (see below).

If you accept this offer of employment, then Cement Australia will recognise your period of service with Hanson Construction Materials Pty Ltd (Hanson) for all purposes, including for the purposes of:
· redundancy;
· unfair dismissal;
· annual leave;
· personal leave;
· long service leave;
· parental leave under the NES; and
· requests for flexible working arrangements under the NES.

The practical effect of the above is that;

· your service with Hanson will be taken into account in calculating any future entitlement to redundancy pay (if applicable);
· if you have any accrued but untaken personal leave or annual leave balance with Hanson, that balance will be reflected on your commencement of your employment with Cement Australia; and
· in respect of unfair dismissal, parental leave under the NES and requests for flexibility working arrangements under the NES, your period of service with Hanson will count as service with Cement Australia.

Application to the Fair Work Commission
As an employee of Hanson, your current employment is covered by the Hanson Construction Materials Pty Ltd South East Queensland Agitator, Cement Tracker and Tipper Drivers Enterprise Agreement 2023 (Hanson Agreement). Cement Australia will be making an application to the Fair Work Commission under section 318 of the Fair Work Act 2009 (Cth) seeking an order that the Hanson Agreement (applicable to your employment with Hanson) does not apply to your employment with Cement Australia (Application).
If the Application is successful and the Fair Work Commission makes the orders sought in the Application, the Cement Australia Transport Workers (South East Queensland) Enterprise Agreement 2022 will apply to your employment with Cement Australia. If the Application is not successful, and the Fair Work Commission does not make the orders sought in the Application, then the Hanson Agreement may continue to apply to you, even after you commence employment with Cement Australia.

If the Application is successful, then in addition to aligning your terms and conditions with other Cement Australia employees, employment under the Cement Australia Transport Workers (South East Queensland) Enterprise Agreement 2022 will provide you with enhanced benefits over and above the Hanson Agreement. In addition to the Contract of Employment, a document comparing the terms of the Cement Australia Transport Workers (South East Queensland) Enterprise Agreement 2022 against the terms of the Hanson Agreement which demonstrates these enhanced benefits is also attached.

We encourage you to read these documents. If you have any views about the Application, please email Renata Plonka (Senior HR Business Partner) at [redacted] on or before Monday 20 May 2024.

…”

The Applicant has also sought the Transferring Employees’ support by asking each of them in writing whether they consent to and/or support the application for the order sought. Four of the seven Transferring Employees responded by email that they consent to and/or support the application. The email sent to employees are extracted below:

“Hi [Employee]

Thank you so much for returning the signed contract. I can confirm I have received it.

As discussed in the meetings with Hanson and Cement Australia leaders, and in your offer letter, Cement Australia will be making an application to the Fair Work Commission seeking an order that the Hanson Agreement (applicable to your employment with Hanson) does not apply to your employment and for the Cement Australia Transport Workers (South East Queensland) Enterprise Agreement 2022.

Do you consent to and/or support the Application to the Fair Work Commission for the Cement Australia Transport Workers (South East Queensland) Enterprise Agreement 2022 to cover your employment?

If you have any questions or concerns about the application being made, please let us know.

Kind regards
Renata”

The four employees’ responses are extracted below:

Employee 1
“… Yes I consent to the application to the Fair Work Commission for the reason described.”

Employee 2
On 16 May 2024:
“Hi Renata, I accept the offer thank you very much”

On 17 May 2024:
“Hi Renata yes I want to leave hanson agreement and enter into cement Australia agreement thanks.”

Employee 3
“…Yes I do.”

Employee 4 “…Yes I consent and support for this application to the Fair Work Commission.”

Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment

The Applicant contended that the Transferring Employees will not be disadvantaged in relation to their terms and conditions of employment when employed by the Applicant. A comparison of the key terms and conditions were provided by the Applicant for my consideration.

The key comparison are as follows:

Key Terms	Cement Australia Agreement	Hanson Agreement
Nominal Expiry Date	31 December 2024	30 November 2026
Award	Road Transport & Distribution Award 2020	Road Transport & Distribution Award 2020
Employment Categories	FT – 38 hours; PT – as per award Fixed term – max period 2 years Casuals – 25% loading; min payment 4 hours	FT – 38 hours per week – Monday to Friday inclusive PT and Casuals are covered by the Award
Hours of Work	7.6 hours per day, or 38 hours per week. Loaded rate up to 10 hour per day	38 hours per week, M-F, 5 consecutive days.
Starting time	5.30am commencement Day workers 3pm – 4pm for Afternoon workers	Work commencements between 5am and 7am. If asked to start prior to 5am it will be paid as overtime Night shift – commence after 3pm and before 9pm M-F
Meal breaks	Day workers 30 min unpaid Mon-Fri Afternoon 30 min paid Mon-Fri Paid rest pause 15 min x 2 in 8 hour day, taken in line with regulation breaks where possible After 9.6 hours worked, paid break 20 mins After 11.6 horus worked, paid break 20 mins Weekends and PH – 30 min paid break after 5 hours	30 min paid meal break Mon-Fri More than 4 hours OT, additional crib break 30 min ordinary time Rest breaks in line with NHVL
RDOs	Not a part of the agreement.	Monday – Friday 8 hours x 5 days less 2 hours RDO accumulated allowing the employee a rostered day off with ordinary pay. RDO’s will be taken on a specific day each month. Can also be used at short notice due to coincidence with wet weather, truck maintenance or breakdown by agreement. Must be taken by 31^st Dec each year
Shift work	Afternoon shift commencing 3-4pm Loaded rate incorporates shift loading	Shift work may be implemented Minimum as per award Perm night shift 25% loading
Wage increases	Wage rate increases 1/1/23 – 3.5% 1/1/24 – 2.5% Paid loaded rate for up to 10 hours/worked per day	Wage rate increases 1/11/23 – 6% 1/11/24 – 4.5% 1/11/25 – 4.5%
Wage rates	Hourly base rate ranging from $32.53 - $35.11 depending on grade. Day loaded hourly rate of $39.71 - $42.85 depending on grade Afternoon loaded hourly rate of $46.30 - $49.97 depending on grade	Currently hourly rates ranges from $28.148 to $32.180 depending on an employee’s classification
Superannuation	SGC	SGC
Overnight Allowance (per night)	1 January 2024 - $70.55	Will be provided with accommodation and meals but does not specify an amount
First Aid Allowance (per week)	1 January 2024 - $16.09	$14.04 per week (increased in line with wages increase)
Shift Allowances	Incorporated into Afternoon and Day Hourly Rate	25% for shift work
Driver Mentor / Trainer Allowances	1 January 2024 - $33.43	Driver trainers $35 per day Indexed to wage increases
Meal Allowance	1 Jan 2024 - $19.21 Worked 9.6 hours; 11.6 hours; 15.6 hours Weekends, PH worked 9 hours of more.	$18.59 (increased in line with percentage increase in wages) M-F: OT of 2 hours or more after ordinary hours; then again after 4 hours or more. Saturday – after 9 hours worked
Leading hand allowance	As per award for nominated Leading Hands	Excluded
Dirt allowance	1 January 2024 - Materials Handling - $1.29 per hour	Excluded
Overtime	Loaded rate up to 10 hours, 2x base rate after that M-F Saturday Day workers Saturday: 1.5x base rate for 2 hours, 2x after that Sunday: 2x base rate all hours worked Sunday 2x base rate all hours, min 4 hours Payment of a minimum of four hours at the appropriate overtime rate after an employee is recalled at the end of a shift	After 8 hours, paid overtime or if commencing work prior to 5am then overtime is paid. Mon – Fri after 8 hours - First 2 hours 1.5x, then double time Saturday – First 2 hours 1.5x, balance at double time Sunday – all hours double time Min. 4 hours payment Sat/Sun Night shift OT = 2x
Counselling and warning	N/A	Prescribed process for managing disciplinary action
Redundancy	Notice based on service up to max 4 weeks (5wks 45+ years of age, 2+ YOS) Severance pay: 3 weeks per year of service up to a max of 42 weeks pay at base rate	In line with National Employment Standards
Termination	NES provision Employees reciprocate notice except for additional one week if over 45	Minimum one week or any greater amount in accordance with NES provision
Probationary Period	6 months	6 months One weeks notice within qualifying period
Pay frequency	Fortnightly by EFT	Weekly pay
Personal Leave	NES – 10 days per annum Med cert for 2 days or more, or 1 day if adjacent to PH 20% outstanding Personal Leave paid out on termination Carers leave NES	NES Med cert required after 8 hours, or day prior to PH
Annual Leave & Loading	As per NES – 4 weeks 17.5% leave loading 24% leave loading for afternoon shift workers Cashing out of A/L – accrued balance of 4 weeks must remain	As per NES – 4 weeks Company direction to take leave when accrued more than 10 days with min 30 days notice
Public Holidays	Christmas Day / Good Friday – 2x for hours worked + 1 days’ pay All other PH – 1.5x for hours worked + 1 days’ pay 4 hours min on PH	Work on PH paid at 2.5x, with minimum of 4 hours
Long Service Leave	As per legislation	LSL Act
Community Service Leave	NES provision Jury service top up between jury service payment
Compassionate Leave	NES provision	As per NES up to 2 days per occasion
Parental Leave	CA Policy	Hanson Policy which is greater than NES
Family and Domestic Leave	NES	NES
Time off without pay	Max 2 months unpaid leave due to family circumstances, case by case basis
Union matters	TWU delegate recognition Paid union consultation meetings of 30 mins bi-monthly at TWU request TWU induction 30 mins at TWU request	TWU delegate recognition in accordance with FWA
Delegate Rights	Various rights for delegates including to paid time to consult with TWU members and paid time to attend accredited TWU training	N/A
Job Security	Commitment to prioritise engagement of full-time employees over casual and labour hire	N/A
Designated plant / transfer / relief drivers
Other matters	Anti-Discrimination WH&S Driver duties First Aid kits Uniforms & PPE Licence history Training Work to schedules and notify if can’t Flexibility of work practices Best practice / new technologies/trials Continuous improvement Must notify when schedule can’t be met Increase in double shifting	Anti Discrimination Multiskilling Training
Counselling and Discipline	One verbal and two written warnings may result in employee termination at Hanson discretion Direct negative affect to customer is considered serious misconduct
Disputes Procedure	For disputes under EA or NES. 4 step process, then FWC Status quo prior to the dispute unless those conditions cannot be restored.	For disputes under EA or NES. 4 step (potential) process, then FWC Timings for each stage ie max 24 hours. Status quo while procedure is followed
Consultation Clause	Fair Work model clause	Fair Work model clause
Individual Flexibility Agreement	Fair Work model clause	Fair Work model clause
Christmas – New Year slow period	Employees required to take annual leave or LWOP where no AL accrued Dates and standby driver process for slow period to be circulated by 1 December

In light of the above comparison table, the Applicant therefore submitted that the Transferring Employees would not be disadvantaged in relation to their terms and conditions.

The nominal expiry dates of the Agreement

The nominal expiry date for the Hanson Agreement is 30 November 2026, and the Cement Australia Agreement is 31 December 2024.

The Applicant submitted that this factor is neutral as the Transferring Employees will be able to participate in future bargaining process to renew the Cement Australia Agreement.

Whether the Hanson Agreement would have a negative impact on the productivity of the Applicant’s workplace

The Applicant submitted that if the Orders sought are not made, it would cause a negative impact on the productivity of the Applicant’s workplace as it would require the Applicant to:

· manage the coordination of different rostering practices which vary in start time, provision of rostered day off (RDOs), and overtime arrangements;

· invest in a significant activity to onboard the Hanson Agreement, including configuration into Cement Australia’s payroll systems;

· invest in large scale training programs to upskill the functional (Human Resources, Payroll, Accounting) and operations team Senior Transport Team Leaders, Logistics Manager) to understand the terms and conditions of an additional enterprise agreement (Hanson Agreement) at Cement Australia;

· maintain two separate time sheeting activities across the SEQ Distribution team which will create additional administrative burden for pay administrators and increase risk of inaccuracies and payroll error; and

· maintain two significantly different sets of terms and conditions for the one SEQ Distribution team and which, for Transferring Employees, would be significantly different and inferior in regard to pay rate, to the rest of the Applicant’s employees transporting and delivering cement to the South East Queensland region. This has the potential to lead to disharmony within the workforce and questions from employees as to why two significantly different sets of terms and conditions apply between employees doing the same or similar work for the same employer.

The Applicant further submitted that if the Orders were to be granted, it could only have a positive impact on the productivity as the Cement Australia Agreement is specific and bespoke to Cement Australia’s South East Queensland locations and is therefore better suited to the Applicant’s operations.

It is contended that productivity benefits will also flow from having a single unifying instrument covering the Applicant’s workforce who perform work in the South East Queensland region, both Transferring and Non-Transferring Employee cohorts. These include:

· avoiding the cost and administrative burden of the Applicant having to be conversant and comply with two industrial instruments for an otherwise undifferentiated workforce;
· avoiding maintaining the relevant rostering, payroll and IT systems attached to those two instruments; and
· the negative impact on productivity arising from the administrative and compliance burden on Senior Transport Team Leaders of having to familiarise themselves and comply with distinct regimes under the two instruments (e.g. dispute settlement procedures, consultation and change procedures, discipline processes and redundancy requirements).

For these reasons, the Applicant submitted productivity would be negatively impacted if the proposed Orders are not granted.

Whether the Applicant would incur significant economic disadvantage as a result of the Hanson Agreement covering the Applicant

The Applicant argued that should the transferrable instrument cover the Applicant, this would cause economic disadvantage as operational efficiencies would be minimised, and the business’ exposure to significant payroll compliance issues and potential loss of productivity from industrial disharmony would also be increased.

The degree of business synergy between the Hanson Agreement and the Cement Australia Agreement

It is submitted that there is some business synergy between the Cement Australia Agreement and Hanson Agreement but they provide for different employment conditions. Relevantly, the Hanson Agreement is customised to Hanson’s specific business operations which includes concrete mix delivery via agitators and aggregate materials carted by tippers in addition to the delivery of cement and cementitious product, whereas the Cement Australia Agreement is specific to the cartage of cement and cementitious products.

It is in these circumstances the Applicant considered it unsurprising that the two agreements are not in synergy.

The public interest

The Applicant submitted that maintaining a cohesive, harmonious and productive workplace is a matter of public interest. This is particularly so for a large operator like the Applicant which has a significant workforce of approximately 60 employees in the SEQ distribution team. Further, it is the Applicant’s interest in enhancing productivities through the proposed Order which would align with those of the Transferring Employees, given the Cement Australia Agreement provides terms and conditions which are no less favourable overall, and in a number of instances, more beneficial than under the Hanson Agreement.

The Applicant contended that his is supported by the fact that all of the Transferring Employees who were provided with offers of employment and an explanation that the Applicant would be making the application, accepted those terms.

The longer-term interests of the Transferring Employees are likely to be better served by being treated as an integrated agreement-covered cohort together with their colleagues who are covered under the Cement Australia Agreement. This is likely to enhance their ability to participate in bargaining for new terms and conditions of employment around the nominal expiry date of the Cement Australia Agreement.

Therefore, the Applicant submitted there are no issues of public interest in this matter that would impact against the Orders sought being made.

Employee and union views

The Transport Workers’ Union of Australia (TWU) is covered by both the Hanson Agreement and Cement Australia Agreement.

On 20 June 2024, I directed the Applicant to communicate in writing to each of the Transferring Employees, inviting them to correspond by email with my chambers in the event they wished to provide their views. On the same day, I received confirmation from the Applicant that it had complied with the above direction, and that another Transferring Employees responded to the Applicant, advising as follows:

“Hi Renata,

Yes I want to leave Hanson agreement
and enter into cement Australia agreement thanks…”

The Transferring Employees and TWU were invited to provide any views relevant to the application. I have not received correspondence directly from any of the seven Transferring Employees or the TWU.

Consideration

On the evidence before me, I am satisfied that there will be a transfer of business within the meaning of s.311(1)(a) to (d) of the Act when employees of Hanson commencement employment with the Applicant on 25 June 2024.

I am satisfied that the work of the employees is transferring work within the meaning of s.311(1)(c) in that employees of Hanson have been offered employment with the same, or substantially the same work the employees performed for Hanson.

Pursuant to s.311(3) of the Act, and for the purposes of s.311(1)(d) of the Act, there is a connection between Hanson and the Applicant because the Applicant will take over Customer Deliveries Work from Hanson. I am satisfied this meets the requirements of s.311(3) of the Act.

I am satisfied that employees from Hanson who take up employment in the same or substantially the same role with the Applicant will be transferring employees for the purpose of s.311(2) of the Act.

The application has been made by Cement Australia. Cement Australia is the new employer of the Transferring Employees. The requirements of s.318(2) have therefore been met.

Section 318(3)(a) – the views of the new employer and the employees who would be affected by the order

The new employer is Cement Australia, the applicant seeking an order under s.318 that the Hanson Agreement not cover the new employer and transferring employees. Naturally, it supports making the order sought.

As I earlier noted, I directed the Applicant to forward correspondence to affected employees, inviting them to provide any views they had to my Chambers, if they wished to do so. I also invited any further views held by TWU relevant to this application.

Whilst I have not heard from any of the Transferring Employees, I note the correspondence sent by the Applicant to the Transferring Employees some time ago, and have had regard to the correspondence communicated by four of the Transferring Employees. This consideration weighs in favour of making the order sought.

Section 318(3)(b) – whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment

Having taken into account the detailed comparison table of the Applicant, I am satisfied that, overall, transferring employees would not be disadvantaged by the order sought. This consideration weights in favour of making the order sought.

Section 318(3)(c) – if the order relates to an enterprise agreement—the nominal expiry date of the agreement

The nominal expiry date of the Hanson Agreement is 30 November 2026, whereas the nominal expiry date of the Cement Australia Agreement is 31 December 2024. If the order is made, transferring employees will be covered by Cement Australia Agreement and in a position to seek renegotiation of the Cement Australia Agreement approximately six months after they become employed.

This consideration weighs somewhat in favour of making the order sought.

Section 318(3)(d) – whether the transferrable instrument would have a negative impact on the productivity of the new employer’s workplace

The Applicant has made submissions regarding this matter, which are outlined above. I consider the matters raised by the Applicant regarding the burden of applying multiple industrial instruments to be an avoidable and unnecessary burden on the Applicant.

This consideration weighs in favour of making the order sought.

Section 318(3)(e) – whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer

The Applicant has made submissions regarding this matter, which are outlined above. I accept the Applicant’s evidence on this issue. Accordingly, this consideration weighs in favour of making the order sought.

Section 318(3)(f) – the degree of business synergy between the transferrable instrument and any workplace instrument that already covers the new employer

As to this factor, the Applicant has stated that the terms and conditions of the Hanson Agreement are inconsistent with the terms and conditions of the Cement Australia Agreement and the operational requirements of the Applicant’s business.

I accept the Applicant’s evidence on this issue. This factor weighs in favour of making the order sought.

Section 318(3)(g) – the public interest

I am satisfied that making the order would not be contrary to the public interest. This consideration weighs in favour of making the order sought.

Conclusion

Having considered the application and having taken into account each of the matters set out in s.318(3) of the Act, I am satisfied that it is appropriate to make the orders sought.

In making the order sought under s.318, the Applicant will not be covered by the Hanson Agreement by virtue of employing employees from Hanson as transferring employees. Transferring employees will be covered by the Cement Australia Agreement upon their employment commencing.

Having regard to s.318(4) of the Act, the order must not come into operation before the later of the time when the transferring employee becomes employed by the new employer or the date on which the order is made.

COMMISSIONER

[1] [2024] FWCA 305.

[2] [2023] FWCA 1025.

Printed by authority of the Commonwealth Government Printer

Employee 1	“… Yes I consent to the application to the Fair Work Commission for the reason described.”
Employee 2	On 16 May 2024: “Hi Renata, I accept the offer thank you very much” On 17 May 2024: “Hi Renata yes I want to leave hanson agreement and enter into cement Australia agreement thanks.”
Employee 3	“…Yes I do.”
Employee 4	“…Yes I consent and support for this application to the Fair Work Commission.”

[2024] FWC 1644

24 JUNE 2024