Coles Supermarkets Australia Pty Ltd
[2024] FWC 2031
•31 JULY 2024
| [2024] FWC 2031 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.319 - Application for an order relating to instruments covering new employer and non-transferring employees
Coles Supermarkets Australia Pty Ltd
(AG2024/2440)
SAPUTO DAIRY AUSTRALIA PTY LTD AND UNITED WORKERS UNION DAIRY BEVERAGE CENTRE AGREEMENT 2023
| Food, beverages and tobacco manufacturing industry | |
| COMMISSIONER YILMAZ | MELBOURNE, 31 JULY 2024 |
Application for an order relating to instruments covering new employer and non-transferring employees
This decision concerns an application by Coles Supermarkets Australia Pty Ltd (the Applicant) for orders pursuant to s.319(1)(b) of the Fair Work Act 2009 (the Act) that the Saputo Dairy Australia Pty Ltd and United Workers Union Dairy Beverage Centre Agreement 2023[1] (the Agreement) will cover non-transferring employees who perform transferring work for the Applicant.
By way of background, the Applicant, has obtained employment for employees of Saputo Dairy Australia Pty Ltd (Saputo) at two facilities in Laverton North, Victoria and Erskine Park, New South Wales. These employees are currently covered by the Agreement and the work they will perform is on the same terms and conditions of the Agreement. The Agreement will be a transferable instrument when the employees of Saputo transfer to the Applicant. The Applicant is not covered by the Agreement and expects that it will employ new employees that will perform work covered by the Agreement. Without this order new employees would not be covered by the Agreement. The Applicant is therefore seeking orders that the transferable instrument, the Saputo Dairy Australia Pty Ltd and United Workers Union Dairy Beverage Centre Agreement 2023 apply to new non-transferring employees engaged to perform work that is the same as the transferring employees.
The orders sought by the Applicant are as follows:
1. Pursuant to section 319(1)(b) of the Fair Work Act 2009 (Cth), the Fair Work Commission orders that the Saputo Dairy Australia Pty Ltd and United Workers Union Dairy Beverage Centre Agreement 2023 covers, or will cover, any non-transferring employees of Coles Supermarkets Australia Pty Ltd who perform, or are likely to perform, the transferring work for Coles Supermarkets Australia Pty Ltd at the sites located at 79 William Angliss Drive, Laverton North, Victoria and 111-113 Quarry Road, Erskine Park, New South Wales.
2. This Order will come into effect in relation to a particular non-transferring employee on the later of the following:
a. the date of this Order; or
b. the date from which the employment of the non-transferring employee commences with Coles Supermarkets Australia Pty Ltd.
The orders will not apply to any other non-transferring employee employed by the Applicant at any other location, and the transferring work will be limited to the work covered by the transferrable instrument at the relevant locations.
Both the Applicant and the union covered by this Agreement, The United Workers’ Union (UWU), have advised they do not need to be heard on this matter and therefore I am satisfied that the matter can be determined on the papers without the need for a hearing.
New non-transferring employees of new employer to be covered by transferable instrument
I am satisfied that the Agreement is a transferable instrument within the meaning of s.312 of the Act, and I observe that the Applicant accepts that the Agreement is a transferable instrument. Section 314 of the Act sets out when new non-transferring employees may be covered by a transferring instrument. The clause provides:
“New non-transferring employees of new employer may be covered by transferable instrument
(1) If:
(a) a transferable instrument covers the new employer because of paragraph 313(1)(a); and
(b) after the transferable instrument starts to cover the new employer, the new employer employs a non-transferring employee; and
(c) the non-transferring employee performs the transferring work; and
(d) at the time the non-transferring employee is employed, no other enterprise agreement or modern award covers the new employer and the non-transferring employee in relation to that work;
then the transferable instrument covers the new employer and the non-transferring employee in relation to that work.
(2) A non-transferring employee of a new employer, in relation to a transfer of business, is an employee of the new employer who is not a transferring employee.
(3) This section has effect subject to any FWC order under subsection 319(1).”
The Agreement, the transferable instrument, in accordance with s.313(1)(a) is an instrument that covers the new employer and the transferring employee in relation to the transferring work after the transfer time that the employee becomes employed by the new employer.
Consideration of section 319
Section 319 of the Act sets out the matters the Commission must have regard to in determining if the orders sought should be granted.
Section 319 provides as follows:
“Orders relating to instruments covering new employer and non-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 non-transferring employee because of subsection 314(1) does not, or will not, cover the non-transferring employee;
(b) an order that a transferable instrument that covers, or is likely to cover, the new employer, because of a provision of this Part, covers, or will cover, a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer;
(c) an order that an enterprise agreement or a modern award that covers the new employer does not, or will not, cover a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer.
Note: Orders may be made under paragraphs (1)(b) and (c) in relation to a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer, whether or not the non-transferring employee became employed by the new employer before or after the transferable instrument referred to in paragraph (1)(b) started to cover the new employer.
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 non-transferring employee who performs, or is likely to perform, the transferring work for the new employer;
(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 non-transferring employee before the later of the following:
(a) the time when the non-transferring employee starts to perform the transferring work for the new employer;
(b) the day on which the order is made.”
The application in relation to the matters to be taken into account
Section 319(3)(a)(i) – Views of the new employer
The Applicant is the new employer, who seeks, and is supportive of, the order.
Section 319(3)(a)(ii) – views of the employees who would be affected by the order
It is not possible to obtain the views of the employees who will be affected by the order because there are no non-transferring employees currently employed by the Applicant. I do observe that the UWU supports the proposed orders.
Section 319(3)(b) – whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment
The Applicant submits that the transferable instrument is more beneficial than any modern award that would apply.
Currently there is no other Agreement that applies to the work of transferring employees therefore it would be advantageous that non transferring employees are covered by the same instrument as transferring employees. The employees affected by this Order would not be disadvantaged in relation to their terms and conditions in favour of making the order sought.
Section 319(3)(c) – the nominal expiry date of the agreement
I note that the Agreement has a nominal expiry date of 30 September 2026 and consider that the granting of the proposed orders would not disadvantage employees.
Section 319(3)(d) – whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace
The Applicant submits, ‘The order sought would enhance the productivity of the Applicant’s workplace by protecting the integrity of the Agreement and its intended application to the work within its scope, and by preventing the need for two different industrial instruments applying to employees performing the same work for the Applicant.’
On the other hand, the Applicant submits that not granting the order would have a negative impact on the productivity of the Applicant’s workplace. Some of the reasons the Applicant lists include the administrative burden in managing employees under two separate industrial instruments, inefficiencies in operational processes and procedures, the industrial disharmony due to significant difference in pay rates and entitlements applying to employees.
I am satisfied that there will be no negative impact on productivity upon making the order sought.
Section 319(3)(e) – whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer
The Applicant submitted there will be no significant economic disadvantage in making the order and ‘instead, the administrative and operational procedures of the sites would operate more efficiently if one industrial instrument applied consistently to each transferring and non-transferring employee.’
I consider that if the order sought were made, the Agreement’s coverage of non-transferring employees will not cause any significant economic disadvantage.
Section 319(3)(f) – the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer
The Applicant submits that the transferable instrument currently covers transferring employees and that if the order is not made there will be two classes of employees performing the same work, one class which is paid in accordance with the Agreement and another in accordance with the Award.
I am satisfied that the requirement of s.319(3)(f) is met based on a consideration of the materials before me.
Section 319(3)(g) – the public interest
The Applicant submits that public interest would be served by enabling non-transferring employees work under the same terms and conditions of employment as transferring employees which was negotiated specifically for the needs of the employees and the operations of the site. Having regard to all the material before me, I am not of the view there are public interest reasons that weigh against making the Order sought.
Conclusion
Having taken into the account the material provided by the Applicant in support of its
application and the matters set out in s.314 and 319(3) of the Act, I am satisfied that that it is appropriate to grant the order pursuant to s.319(1)(b), that a transferable instrument that covers, or is likely to cover the new employer, because of a provision of this Part, covers, or will cover, a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer.
An order[2] to this effect will be issued together with this decision.
COMMISSIONER
[1] AE524439
[2] PR777717
Printed by authority of the Commonwealth Government Printer
<PR777719>
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