Christopher Chads Enterprise Pty Ltd T/A Banyo Burger Urge

[2017] FWCA 1968

[2017] FWCA 1968

FAIR WORK COMMISSION

DECISION

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

Christopher Chads Enterprise Pty Ltd T/A Banyo Burger Urge
(AG2016/4755)

Fast food industry
DEPUTY PRESIDENT BULL	PERTH, 6 APRIL 2017

Application for approval of the Burger Urge Christopher Chads Enterprise Pty Ltd Enterprise Agreement 2016

[1] An application has been made by Christopher Chads Enterprise Pty Ltd T/A Banyo Burger Urge (the applicant) for the approval of an enterprise agreement known as the Burger Urge Christopher Chads Enterprise Pty Ltd Enterprise Agreement 2016 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act) and is a single enterprise agreement.

[2] The Agreement covers all employees engaged by the employer.

[3] The Form F16 - application for approval of an enterprise agreement – provided by the employer indicates that no union bargaining representatives or employee bargaining representatives were involved in the agreement making process.

[4] The Form F17 – statutory declaration in support of an application for approval of an enterprise agreement indicates that at the time employees voted to approve the Agreement on 22 July 2016, there were only three employees (aged over 45 years) who would be covered by the Agreement.

[5] The Commission wrote to the applicant requesting the applicant clarify the number of people employed by the business at the time of the vote as it would appear difficult to operate the applicant’s business with only three staff.

[6] In an email of 8 February 2017, the applicant responded that at the time of the vote the business only had three employees as it was not yet fully operational. The business opened to the public on 31 July 2016, and has increased its staffing levels so that it currently employs 10 employees.

Nominal expiry date

[7] The Agreement provides that it will operate for a nominal term of four years from the date the Agreement commences. The Commission wrote to the applicant noting that the Act specifies the nominal expiry date can be no more than four years from the date of approval.

[8] The applicant has provided an undertaking that the Agreement will remain in force for a period of four years from the date of approval by the Commission.

Consultation term

[9] The Agreement provides at clause 7.1.1 that the consultation clause will apply if the employer proposes to introduce significant change to the regular roster or ordinary hours of employees. The requirement for employers to consult with employees under the Act, at s.205(1) is that the employer consult employees about a change to their regular roster or ordinary hours of work. The Commission was concerned that the Agreement may relieve the employer from the obligation to consult if it were determined by the employer that the change to rosters or hours is not significant.

[10] Pursuant to s.205(2) of the Act, the model consultation term at Schedule 2.3 of the Fair Work Regulations 2009 will be taken to be a term of the Agreement.

National Employment Standards

[11] The Agreement provides at clause 5.2.2, Personal/Carers Leave, that casual employees are entitled to a maximum of 48 hours of unpaid leave. Section 102 of the Act provides for an entitlement to two days of unpaid carer’s leave for each permissible occasion. The Commission was concerned that the term in the Agreement is detrimental when compared to the National Employment Standards (NES) because it limits unpaid carer’s leave that casual employees may access to an amount less than the NES.

[12] The applicant has provided an undertaking that casual employees shall be entitled to two days of unpaid carer’s leave per occasion in accordance with the NES.

Better off overall test

[13] Despite the applicant’s statutory declaration stating that the Agreement does not contain any terms which are less beneficial than the Fast Food Industry Award 2010 (the Award), being the relevant modern award for the purpose of the better off overall test, the Commission’s analysis suggested that while the base rates of pay under the Agreement are between 13-25% above the corresponding Award rates, the rates of pay may not compensate for reductions including to weekend penalties and the spread of hours which would have applied to employees under the Award.

Training

[14] The Commission noted that the Agreement provides for employees to undertake work related training and that the majority of training will be conducted during paid work time. The Commission noted that there was no indication as to how much training would be conducted outside of employees’ rostered hours.

[15] The applicant has provided an undertaking that when the employer directs an employee to undertake training; the employer will pay the cost of the training and will pay the employee their ordinary rate for all time required to complete the training.

Part-time employees

[16] The underlying Award makes clear at clause 12.1 that a part-time employee is an employee who is engaged to work fewer than 38 ordinary hours per week and “has reasonably predictable hours of work.” It goes on to state in sub clause 12.2:

“12.2 At the time of first being employed, the employer and the part-time employee will agree, in writing, on a regular pattern of work, specifying at least:

● the number of hours worked each day;

● which days of the week the employee will work;

● the actual starting and finishing times of each day;

● that any variation will be in writing;

● that the minimum daily engagement is three hours; and

● the times of taking and the duration of meal breaks.

12.3 Any agreement to vary the regular pattern of work will be made in writing before the variation occurs.

12.4 The agreement and any variation to it will be retained by the employer and a copy given by the employer to the employee.

12.5 An employer is required to roster a part-time employee for a minimum of three consecutive hours on any shift.

12.6 An employee who does not meet the definition of a part-time employee and who is not a full-time employee will be paid as a casual employee in accordance with clause 13” (Casual employment)

[17] The overtime provisions in clause 26 of the Award indicate the overtime penalties that will apply, in the case of part-time employees, to all hours worked in excess of the agreed hours, or varied hours.

[18] The provisions in the Award are clear and specific in regard to part-time work. They intend, firstly, that a regular pattern of work will be agreed upon at the outset. Secondly, hours in excess of those agreed upon or varied in writing will attract payment of overtime.

[19] The Commission noted that the Agreement does not provide that part-time employees will receive overtime penalties for hours in excess of their agreed hours.

[20] In response, the employer provided an undertaking to amend clause 2.3.2 to include the following sub clause d:

“At the commencement of your employment, you and the employer will agree on the number of hours to be worked each week (‘agreed hours’). Your agreed hours may be varied by mutual agreement. Any hours worked in excess of your agreed hours will be paid as overtime in accordance with clause 3.2.”

Weekend work

[21] The Agreement provides that the ordinary hours of work are 38 hours per week and that employees can be rostered to work up to a maximum of 11 ordinary hours on any day. The Agreement also provides that part-time and casual employees will be engaged for a minimum of 3 hours per engagement.

[22] Clause 3.1.2 of the Agreement states that employees will not be employed to work more than 3 hours on a weekend without first having worked 11.5 hours in the preceding week (Monday-Friday).

[23] The Agreement does not provide for weekend penalties.

[24] The Commission noted that in circumstances where an employee regularly works a significant proportion of hours on a weekend, they may not be better off overall. Additionally, the Commission noted that there was no limitation on how many hours employees can work on the weekend.

[25] The employer provided an undertaking that replaces the contents of clause 3.1.2 with the following:

“Employees will not be employed to work 3 hours or more on a weekend without first having worked 27.5 hours in the preceding week (Mon-Fri). Employees will only be rostered to work a maximum of 30.4 hours on weekends (Saturday and Sunday) over a four week period.”

[26] The employer also provided an undertaking to amend clause 2.3 to include a further clause 2.3.5, which reads:

“No employee shall be employed to work more than 10 hours in any day.”

Salaried employees

[27] The Agreement contains loaded rates of pay for salaried employees, including Salaried Managers and Assistant Managers.

[28] The Commission noted that the rates of pay for salaried employees are inclusive of all hours worked and that clauses in the Agreement relating to hours of work, overtime, penalty rates, allowances, annual leave loading and public holiday penalties do not apply to Salaried Managers. The Commission also noted that there is no indication of how many additional hours these employees will work.

[29] In its correspondence, the Commission referred to the Full Bench decision in Hart v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Ltd [2016] FWCFB 2887 and suggested undertakings be provided which limit the number of penalty hours which may be worked by employees.

[30] The applicant has provided an undertaking providing that a Salaried Assistant Manager will be paid $49,150 per annum.

[31] The applicant has also provided an undertaking that amends clause 2.3.4 to include the following:

(c) A salaried manager or assistant manager shall not work more than an average of 40 hours per week. Hours may be averaged over a period no greater than one fortnight.

(d) A salaried assistant manager will not work on Sundays.

(e) A salaried manager will not work on Saturdays.

[32] The applicant has further provided an undertaking that no employee will work later than 9.30pm.

Ordinary hours of work and salaried employees

[33] Section 62 of the Act provides that an employer must not request or require an employee to work more than 38 hours in a week unless the additional hours are reasonable taking into account the factors in s.62(3).

[34] The Agreement provides at clause 3.1.1 that the ordinary hours of work are an average of 38 hours per week in accordance with the roster.

[35] The Agreement also provides at clause 2.3.4 that a salaried manager is engaged to work an average of 38 ordinary hours per week plus reasonable additional hours.

[36] In response to the Commission’s concerns in relation to the better off overall test, the applicant has provided an undertaking amending clause 2.3.4 so that a Salaried Manager or Assistant Manager shall not work more than an average of 40 hours per week. I note that the undertakings do not differentiate between ordinary hours and reasonable additional hours.

[37] In accordance with s.62 of the Act, employees are not required to work more than 38 hours per week unless the additional hours are reasonable.

Undertakings provided

[38] The undertakings provided by the applicant address the concerns raised by the Commission. However despite requests from the Commission a signed copy of the undertakings was not provided until 5 April 2017.

[39] The undertakings are taken to be a term of the Agreement and a copy is marked Annexure A. The undertakings are not so substantial that if asked to vote again the employees who voted would not approve the Agreement. I am therefore satisfied that the undertakings do not result in a substantial change to the Agreement, as per s.190(3)(b) of the Act.

Approval

[40] Taking into account the rates of pay under the Agreement in conjunction with the undertakings provided by the applicant, I am satisfied that the Agreement results in employees being better off overall under the Agreement.

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

[42] The Agreement is approved. In accordance with s.54(1), the Agreement will operate 7 days from approval. The nominal expiry date is 4 years from the date of approval.

[43] This decision and the undertakings should be brought to the attention of the employees covered by the Agreement.

DEPUTY PRESIDENT

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Annexure A