Central Healthcare Services Pty Ltd

[2019] FWCA 1607

[2019] FWCA 1607

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Central Healthcare Services Pty Ltd
(AG2018/5607)

CENTRAL HEALTHCARE SERVICES PTY LTD (VIC) ENTERPRISE AGREEMENT 2018

Pharmaceutical industry
COMMISSIONER GREGORY	MELBOURNE, 12 MARCH 2019

Application for approval of the Central Healthcare Services Pty Ltd (VIC) Enterprise Agreement 2018.

[1] An application has been made under s.185 of the Fair Work Act 2009 (“the Act”) by Central Healthcare Services Pty Ltd for approval of an enterprise agreement known as the Central Healthcare Services Pty Ltd (VIC) Enterprise Agreement 2018 (“the Agreement”). It is a single enterprise agreement.

[2] The Applicant is a pharmaceutical wholesaler and distributor and the Agreement is intended to cover 25 employees. It is noted that 24 employees voted in the ballot to approve the Agreement, with 22 voting in favour. Six of the employees are employed on a part-time basis, with the balance being full-time employees.

[3] After reviewing the application, the F17 Employer’s Statutory Declaration, and the terms and conditions contained in the proposed Agreement, the Commission sought clarification from the Applicant about a series of matters. These concerned issues to do with the hours of work and shift arrangements, together with a range of other matters. The Applicant subsequently provided detailed calculations and a range of other explanations which generally satisfied the issues previously raised by the Commission.

[4] The Applicant also proposed a series of undertakings. These concerned the entitlements that would apply to shift workers not involving five successive afternoons or nights; minimum engagement arrangements for part-time employees; meal allowance; and the operation of the provisions in respect of abandonment of employment.

[5] The National Union of Workers (“the NUW”), who were a Union Bargaining Representative for the Agreement, also raised a series of issues that it sought clarification about, and the Commission subsequently requested that it provide further details about these matters. These were set out in an email provided to the Commission and to the Applicant on 20 February 2019. They concerned the payments in respect of work on public holidays; the payments in respect of employees working overtime; and the claims made by the Applicant in regard to the provisions of uniforms and personal protective equipment. The NUW also sought further explanation from the Applicant about the calculations and methodology it had used to substantiate the provisions concerning personal leave, annual leave, and annual leave loading.

[6] The Applicant’s representative subsequently provided a detailed response to the NUW and to the Commission in regard to these matters on 26 February 2019.

[7] In regard to the issue concerning work on public holidays the Applicant indicated that it is not its practice to have employees work on public holidays. It also acknowledged that the Agreement provides for double time for work on public holidays, compared to double time and a half under the underlying modern award. It continued to indicate that in some rare cases it may be possible for employees to be better off under the terms and conditions contained in the Award. It accordingly proposed an undertaking in the following terms:

“Where an employee works on a public holiday the Company shall conduct a reconciliation at the end of the pay period to ensure that the said employee is better off overall when compared to the conditions of the Pharmaceutical Industry Award 2010 for that period. Should a detriment be identified, considered on an overall basis, that detriment shall be made up with an adjustment in the next pay to follow the reconciliation, sufficient to leave the employee better off overall for the period.”

[8] The Applicant next responded to the issue raised about overtime. It indicated in response that given the nature of its shift arrangements there was little scope for overtime to be worked. It also indicated that it has carried out some calculations in response to the issue raised by the NUW which indicated that the arrangement of hours continues to leave the employee significantly better off overall under the terms and conditions contained in the Agreement. It also indicated that a further undertaking could be provided to confirm that afternoon and night shift rosters will not extend beyond eight ordinary hours on a shift.

[9] In regard to the issue to do with the provision of uniforms it simply indicates that the Applicant provides uniforms to its employees, and that is a benefit which should be considered in any better off overall test assessment.

[10] The Applicant finally provided an explanation about how the personal leave, annual leave, and annual leave loading entitlements have been calculated. It also indicated that these details have been provided previously to the NUW and its representatives.

[11] The Commission was again in contact with the NUW after receiving the above responses from the Applicant, and the NUW confirmed that it did not take issue with the explanations provided and accepted the additional undertakings in regard to public holidays and afternoon/night shift now being proposed.

[12] Section 186(1) of the Act requires the Commission on application for approval of an enterprise agreement to approve the Agreement “if the requirement set out in this section and section 187 are met.” 1 Section 186(2), firstly, requires that the Commission must be satisfied that “the agreement has been genuinely agreed to by the employees covered by the agreement,”2 and, secondly, that “the agreement passes the better off overall test.”3

[13] Section 188 of the Act continues to deal with the circumstances in which employees can be said to have genuinely agreed to an enterprise agreement. It states:

“188 When employees have genuinely agreed to an enterprise agreement

An enterprise agreement has been genuinely agreed to by the employees covered by the agreement if the FWC is satisfied that:

(a) the employer, or each of the employers, covered by the agreement complied with the following provisions in relation to the agreement:

(i) subsections 180(2), (3) and (5) (which deal with pre approval steps);

(ii) subsection 181(2) (which requires that employees not be requested to approve an enterprise agreement until 21 days after the last notice of employee representational rights is given); and

(b) the agreement was made in accordance with whichever of subsection 182(1) or (2) applies (those subsections deal with the making of different kinds of enterprise agreements by employee vote); and

(c) there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees.” 4

[14] As indicated, s.186(2)(d) requires that the Commission must be satisfied that the Agreement passes the “better off overall test.” The requirements of the test are dealt with in s.193(1) in the following terms:

“193 Passing the better off overall test

When a non greenfields agreement passes the better off overall test

(1) An enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if the FWC is satisfied, as At the test time, that each award covered employee, and each prospective award covered employee, for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.” 5

[15] Section 193(6) also provides that the “test time” is the time the application for approval is made under section 185.

[16] It is well established that the application of the “better off overall” test requires the identification of terms and conditions in the proposed Agreement that are more beneficial for the employees, and those which are less beneficial, with an overall assessment then being made about whether the employees would be “better off overall” under the Agreement.

[17] I am satisfied on balance that the terms and conditions contained in the proposed agreement do leave employees better off overall when compared to the conditions contained in the underlying modern award. I note in particular in this context the higher wage rates contained in the Agreement, together with the higher night shift loadings that are also provided for. The Applicant has also provided a series of undertakings in response to any issues that might arise in regard to satisfaction with the better off overall test.

[18] As indicated, the Applicant has also proposed that various written undertakings be provided. A copy of those undertakings is attached in Annexure A. I am satisfied that they will not cause financial detriment to any employee to be covered by the Agreement, and that they do not constitute a substantial change to the Agreement. The undertakings are accordingly approved and will now be taken to be a term of the Agreement.

[19] I am otherwise satisfied that each of the requirements of ss.186, 187 and 188, as are relevant to this application for approval, have been met.

[20] The National Union of Workers, being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers the organisation.

[21] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 19 March 2019. The nominal expiry date of the Agreement is 11 March 2023.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

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Annexure A

 1   Fair Work Act 2009 (Cth) s 186(1).

 2   Fair Work Act 2009 (Cth) s 186(2)(a).

 3   Fair Work Act 2009 (Cth) s 186(2)(b).

 4   Fair Work Act 2009 (Cth)s 188.

 5   Fair Work Act 2009 (Cth) s 193.