Construction, Forestry, Maritime, Mining and Energy Union v KM Hale Pty Ltd T/A Spec Services
[2022] FWC 3117
•5 DECEMBER 2022
| [2022] FWC 3117 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.739—Dispute resolution
Construction, Forestry, Maritime, Mining and Energy Union
v
KM Hale Pty Ltd T/A Spec Services
(C2022/2128)
| DEPUTY PRESIDENT DEAN | CANBERRA, 5 DECEMBER 2022 |
Application to deal with a dispute – award coverage.
The Construction, Forestry, Maritime, Mining and Energy Union (Union) has made an application for the Commission to deal with a dispute with KM Hale Pty Ltd T/A Spec Services (Spec Services) in accordance with the dispute settlement procedure contained within the Building and Construction General On-Site Award 2020 (the Award).
Spec Services describes its business as a professional cleaning services company that provides cleaning services throughout NSW and the ACT and employs about 120 employees in various roles including cleaning roles. Its services include commercial cleaning, industrial and construction cleaning, manufacturing, laboratory and specialist equipment cleaning, facilities maintenance services, and biohazard and forensic cleaning.
Spec Services denies it is covered by the Award and contends the Commission does not have jurisdiction to resolve a dispute under the Award in accordance with s.595 and 739 of the Act.
The question for the Commission to determine, as put by the Union, then is:
“For the purposes of exercising the Commission’s power under s595 of the Fair Work Act 2009 to resolve disputes referred to it by clause 39 of the Building and Construction General On-Site Award 2020, is the Respondent an employer covered by the Building and Construction General On-Site Award 2020, within the meaning of clause 4 of the Building and Construction General On-site Award 2020?”
At the hearing, the union was represented by Mr Fischer and Spec Services was represented with permission by Ms Spivey.
Award coverage clause
Clause 4 of the Award (the coverage clause) is in the following terms:
4.Coverage
4.1This industry award covers employers throughout Australia in the on-site building, engineering and civil construction industry and their employees in the classifications within Schedule A—Classification Definitions to the exclusion of any other modern award.
4.2For the purpose of clause 4.1, on-site building, engineering and civil construction industry means the industry of general building and construction, civil construction and metal and engineering construction, in all cases undertaken on-site.
4.3For the purposes of clause 4.2:
(a) general building and construction means:
(i)the construction, alteration, extension, restoration, repair, demolition or dismantling of buildings, structures or works that form, or are to form, part of land, whether or not the buildings, structures or works are permanent and maintenance undertaken by employees of employers covered by clause 4.1 of such buildings, structures or works;
(ii)site clearance, earth-moving, excavation, site restoration, landscaping and the provision of car parks and other access works associated with the activities within clause 4.3(a)(i); and
(iii)the installation in any building, structure or works of fittings and services;
(b) civil construction means:
(i)the construction, repair, maintenance or demolition of:
·civil and/or mechanical engineering projects;
·power transmission, light, television, radio, communication, radar, navigation, observation towers or structures;
·power houses, chemical plants, hydrocarbons and/or oil treatment plants or refineries;
·silos; and/or
·sports and/or entertainment complexes;
(ii)road making and the manufacture or preparation, applying, laying or fixing of bitumen emulsion, asphalt emulsion, bitumen or asphalt preparations, hot pre-mixed asphalt, cold paved asphalt and mastic asphalt;
(iii)the prefabrication and installation of geomembranes, geotextiles and appurtenances;
(iv)dredging or sluicing work for or at premises provided for persons mentioned in or in connection with work under clause 4.3(b)(i);
(v)batch plants and precast yards at a construction site in or in connection with work under clause 4.3(b)(i);
(vi)traffic management in or in connection with work under clause 4.3(b)(i);
(vii)construction and/or establishment of landscape gardens in or in connection with work under clause 4.3(b)(i), provided that this award does not apply to the:
·maintenance or horticultural establishment work following practical completion of work as specified under the terms of the construction contract or project; and/or
·laying-out, construction, cultivation or keeping in order of gardens in connection with private houses;
(viii)the industry or calling of either or both catering and cleaning for or at premises provided for persons mentioned in clause 4.3(b)(i);
(ix)car parks excepting car park buildings and car parks within the alignment of a building; and
(x)railways, tramways, roads, freeways, causeways, aerodromes, drains, dams, weirs, bridges, overpasses, underpasses, channels, waterworks, pipe tracks, tunnels, water and sewerage works, conduits, and all concrete work and preparation incidental thereto;
(c) metal and engineering construction means:
(i)metal trades work performed in the work of construction, fabrication, erection and/or installation work or work incidental thereto when it is carried out at a construction site which is specifically established for the purpose of constructing, fabricating, erecting and/or installing the following:
·power stations, oil refineries, terminals and depots; chemical, petro- chemical and hydrocarbon plants; and associated plant, plant facilities and equipment;
·major industrial and commercial undertakings and associated plant, plant facilities and equipment including undertakings for the processing and/or smelting of ferrous and non-ferrous metals, the processing of forest products and associated by-products, acid and fertiliser plants, cement and lime works, and other major industrial undertakings of a like nature;
·plant, plant facilities and equipment in connection with the extraction, refining and/or treatment of minerals, chemicals and the like;
·transmission and similar towers, transmission lines and associated plant, plant facilities and equipment;
·lifts and escalators as prescribed in clause 42—Lift industry;
·facilities and equipment in other engineering projects; and
·maintenance and/or repair and/or servicing work carried out on-site by the employees of contractors or subcontractors in connection with contracts for on-site construction work referred to in clause 4.3(c)(i). This does not include any work which is incidental to or of a minor nature in relation to the work normally performed by an employee of an employer not engaged substantially in metal and engineering construction.
4.4Without limiting the generality of the exclusion, this award does not cover employers covered by:
(a) the Manufacturing and Associated Industries and Occupations Award 2020;
(b) the Joinery and Building Trades Award 2020;
(c) the Electrical, Electronic and Communications Contracting Award 2020;
(d) the Plumbing and Fire Sprinklers Award 2020;
(e) the Black Coal Mining Industry Award 2020;
(f) the Mining Industry Award 2020;
(g) the quarrying industry as defined in clause 4.3 of the Cement, Lime and Quarrying Award 2020; or
(h) the Premixed Concrete Award 2020.
4.5This award covers any employer which supplies labour on an on-hire basis in the on- site building, engineering and civil construction industry in respect of on-hire employees in classifications covered by this award, and those on-hire employees, while engaged in the performance of work for a business in that industry. Clause 4.5 operates subject to the exclusions from coverage in this award.
4.6This award covers employers which provide group training services for apprentices and/or trainees engaged in the on-site building, engineering and civil construction industry and/or parts of that industry and those apprentices and/or trainees engaged by a group training service hosted by a company to perform work at a location where the activities described herein are being performed. Clause 4.6 operates subject to the exclusions from coverage in this award.
4.7This award does not cover:
(a)an employee excluded from award coverage by the Act;
(b)employees who are covered by a modern enterprise award, or an enterprise instrument (within the meaning of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth)), or employers in relation to those employees; or
(c)employees who are covered by a State reference public sector modern award, or a State reference public sector transitional award (within the meaning of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth)), or employers in relation to those employees.
4.8Where an employer is covered by more than one award, an employee of that employer is covered by the award classification which is most appropriate to the work performed by the employee and to the environment in which the employee normally performs the work.
NOTE: Where there is no classification for a particular employee in this award it is possible that the employer and that employee are covered by an award with occupational coverage.
The case for the Union
The Union contended that the test to be applied in determining award coverage is the ‘principal purpose’ test, which is set out in Carpenter v Corona Manufacturing Pty Ltd[1] as follows:
“In our view, in determining whether or not a particular award applies to identified employment, more is required than a mere quantitative assessment of the time spent in carrying out various duties. An examination must be made of the nature of the work and the circumstances in which the employee is employed to do the work with the view to ascertaining the principal purpose for which the employee is employed”.
It argued that the application of that test shows that the principal purpose of the employment for the employees in question is employment in the building and construction industry as site cleaners, which fits within the coverage of the Award.
It submitted that the applicability of the Cleaning Services Award 2010 (the Cleaning Award) has no bearing on whether Spec Services is also covered by the Award.
Its submissions included the following:
‘b. In terms of construction, Site sheds, lunch sheds, toilet blocks and the actual structure being built are all buildings or structures for the purposes of clause 4.3(a)(i), and cleaning is the most ordinary form of maintenance of those buildings or structures that is “in all cases undertaken on-site”.
c.By placing supervisory responsibilities with site managers and by offering labour hire services on its website, the Applicant acts as a labour hire provider to entities within the building and construction industry, satisfying the criteria at 4.5.
d.The work of site cleaning and cleaning amenities on sites is traditionally known as a “nipper” or “peggy”, and falls within CW1 of the BCGOA. Historically, this was a role falling under the “Group 4 Labourer” description which remains in the modern Award.
e.There is a range of further extrinsic evidence that the Applicant meets the criteria in 4.1 and 4.2:
(i) The Applicant holds itself out as engaging in the construction industry as per its website and promotional materials,
(ii)The Applicant performs specialist tasks that take place solely on site, employs workers with specialist tickets and qualifications only applicable to building sites and who do not perform work outside building sites; and classifies and pays these workers differently from its other workers.
(iii) The cleaning of amenities and final fit-out cleans are activities falling within the definition at s6 of the BUILDING AND CONSTRUCTION INDUSTRY (IMPROVING PRODUCTIVITY) ACT 2016, meaning that the Respondent falls within the definition of “building industry participant” at s5 of that Act, and is regulated accordingly.’
The Union in its written submissions confirmed it did not press the question of whether Spec Services operates on sites falling within the ‘civil construction’ industry. Instead, based on a list of sites provided by Ms Katie Hale, Managing Director of Spec Services, it contended that the sites appeared to be sites on which ‘general building and construction’ was taking place. It said this accorded with the evidence of the Union’s witness, Ms Suzanne Rogers, a former employee of Spec Services.
The Union contended that Spec Services was incorrect in its submissions on the construction of the coverage clause. It said that employees fell within the definition of ‘general building and construction’ because cleaning work is a form of maintenance undertaken in relation to buildings, structures or works.
The Union contended that clause 4.2 had the limiting effect of requiring that only such buildings, structures or works to which the clause applies are those ‘on-site’, ie active construction projects, and the evidence of Ms Hale supported a finding that the cleaning activities undertaken occurred on-site.
Further, the Union said that Ms Hale’s evidence showed that the work of the employees included site clearance and site restoration, which is covered in clause 4.3(a)(ii) of the coverage clause.
In relation to clause 4.5 of the Award, the Union contended that Spec Services is a labour hire company, based on the evidence of Ms Rogers who said she was directed and supervised by another company (a building company) when working at a particular site. The Union also relied on a website page of Spec Services entitled ‘Managed Workforce’ which it said showed that Spec Services was holding itself out to provide general construction labour to the construction industry.
In response to the submissions by Spec Services as to the historical award provisions (outlined below), the Union set out in considerable detail the various award provisions in predecessor awards. In summary, it said that the maintenance and cleaning of sheds and amenities as well as final fit-out cleans was commonly the task of a ‘builders labourer’, and relied on the evidence of Mr Kenneth Miller, an Organiser for the Union. As a result, it said the meaning of clause 4.3(a)(i) should be interpreted in light of the historical context, and the continued existence of the Builders Labourer Group 4 classification, as continuing to refer to workers engaged in construction site cleaning.
Following on, it argued, a straightforward application of the principal purpose test led to the conclusion that the relevant employees are covered by the Award.
The Union submitted that the fact Spec Services divide its services into commercial cleaning and construction cleaning and pay these employees a different rate of pay demonstrates that the jobs and tasks undertaken by cleaners in each area are materially different. Further, the employees engaged in the construction cleaning business are required to hold a White Card which is required of employees who are carrying out construction work.
The case for Spec Services
Spec Services submitted that the principles the Commission is to have regard to in interpreting the coverage clause in modern award were summarised by a Full Bench in Gourabi v Westgate Medical Centre[2] as follows:
‘(a)each modern award has a “coverage” clause that determines “the employers, employees, organisations and outworker entities” that are covered by it.
(b)the determination of whether a particular employment falls within the “coverage” clause of a modern award usually involves two considerations:
(i) a legal question concerning the proper construction of the coverage clause (and any other relevant provisions of the award); and
(ii) a factual question as to whether the employer and employee fall within the scope of the coverage clause, properly construed.
(c)the principles of construction of awards were summarised by Rangiah J in Swissport Australia Pty Ltd v Australian Municipal Administrative Clerical and Services Union (No 3) [2019] FCA 37 at [52] in that:
(i) the task of construction begins with the natural and ordinary meaning of the words used;
(ii) however an award is to be interpreted in light of its industrial context and purpose and its commercial and legislative context; and
(iii) the context includes the immediate textual context and the historical context of the origin of the provision in question.’
It submitted that applying the facts to a proper construction of the coverage clause supported a finding that it (or its employees) was not covered by the Award.
Spec Services noted that the only reference to the industry or calling of cleaning in clause 4 is in the definition of ‘civil construction’, which is defined to include the industry or calling of cleaning for or at premises in connection with construction, repair, maintenance or demolition of:
a.Civil and/or mechanical engineering projects;
b.Power transmission, light, television, radio, communication, radar, navigation, observation towers or structures;
c.Power houses, chemical plants, hydrocarbons and/or oil treatment plants or refineries;
d.Silos; and/or
e.Sports and entertainment complexes.
The industry or calling of cleaning is not otherwise referred to in the definitions of ‘general building and construction’ and ‘metal and engineering construction’ in the Award.
It submitted that based on the natural and ordinary meaning of the words used in, and the immediate textual context of, clause 4.3 of the Award, employers in the industry or calling of cleaning are only covered by the Award if cleaning is undertaken or carried out in connection with ‘civil construction’ and, specifically, on the premises outlined above. Spec Services said the drafters of the Award appeared to have made a deliberate choice to expressly provide for this and have limited the circumstances in which employers in the industry or calling of cleaning will be covered by the Award.
Spec Services also referenced predecessor awards to demonstrate that this construction of the clause was consistent with the historical context of the origin of the coverage clause. It submitted that this showed an intention to maintain a distinction between these areas by establishing the industry as being made up of three distinct elements, being ‘general building and construction’, ‘civil construction’, and ‘metal engineering construction’, and defining each so as to maintain the historical coverage arrangements.
In terms of the factual question as to whether Spec Services and its employees fall within the scope of the coverage clause, it said its evidence filed in the proceedings show that no employee undertakes or carries out cleaning services in connection with ‘civil construction’ as defined in the Award. Because of this, it said, it is not covered by the Award and the Commission does not have jurisdiction to determine the application.
In its evidence, Spec Services relied on two witness statements of Ms Hale. She explained the types of cleaning services they provided. She included the position descriptions for the cleaners engaged to perform ‘industrial and construction cleaning services’, and ‘commercial cleaning services’ which show no material difference between the two positions. She also gave evidence about the types of construction projects to which Spec Services had provided cleaning services and said that no employee undertook or carried out cleaning services at premises connected with the premises outlined in paragraph 21 above.
Ms Hale also gave evidence as to the type of cleaning performed on building and construction sites which included the cleaning of site sheds and facilities, including lunchrooms, toilets and site administrative offices. The purpose of this cleaning was to ensure that the facilities remain in an appropriate condition for use by those working on site. The second aspect was cleaning in respect of buildings or structures under construction including ‘final fit-out clean’, which is essentially a surface clean of the whole or part of a fit-out of a building or construction project for the purposes of facilitating a handover either between tradespeople as they transition between phases of the fit-out, or on completion of the project. She said that employees who perform fit-out cleaning are not otherwise involved in any substantive building and construction work performed by tradespeople.
Ms Hale confirmed that Spec Services does not supply labour on an on-hire basis, and at all times it maintains responsibility for the supervision and control of its employees including when an employee may be performing cleaning services on site at a building and construction site. She also said that it did not have a labour hire licence as required in the ACT to provide labour hire services. She explained the difference in pay rates as a response to the Covid lockdowns, where construction cleaners were eligible for JobKeeper and it was necessary to increase their rates of pay, which was not reversed once JobKeeper ended. She also explained that the term ‘Managed Workforce’ on its website was a reference to the provision of ad-hoc cleaning services to clients but was not a labour hire arrangement.
Consideration
Having considered the evidence and submissions made by the parties, I am satisfied that Spec Services is not covered by the Award.
In terms of the legal question concerning the proper construction of the coverage clause, I agree with the interpretation put forward by Spec Services. The construction of the coverage clause is clear in that the only reference to cleaning arises in the definition of ‘civil construction’, which has a defined meaning outlined earlier. The natural and ordinary meaning of the words, in context, make it clear that employers are only covered by the Award if cleaning is carried out in connection with civil construction as defined. I further agree a review of the predecessor awards show that the coverage clause reflects an intention to maintain historical coverage arrangements. I note the Union did not press its initial contention that Spec Services operates in the civil construction industry.
For the Commission to move past civil construction as the only industry which may cover cleaners, it must be accepted as contended by the Union that cleaning is ‘maintenance’. I disagree with this proposition. The words are plain, and when given their ordinary meaning, I cannot find that it was intended that cleaning be covered as maintenance within the general building and construction industry. Further, there is nothing in the list of indicative tasks in Schedule A of the Award that would support this position.
In terms of the factual question as to whether the employer and employee fall within the scope of the coverage clause, I am satisfied that the evidence does not support a finding that the employees undertake cleaning services in connection with ‘civil construction’, as defined in the Award. The evidence of Ms Hale in this regard was clear and she did not resile from it in cross examination.
I am also satisfied based on the evidence of Ms Hale that Spec Services is not a labour hire company, including for the reason that they do not hold the relevant licence to so operate, and I accept her explanation in cross examination as to the reason some employees hold a White Card.
I consider that the ‘marketing material’ found on the website of Spec Services is not determinative to the matter the Commission needs to decide. I accept the explanation by Ms Hale as to the marketing material on their website and their interest in expanding the business, which may well have implications for award coverage in the future. But the matter I must determine is whether the Award covers the employees in question now and not what may be the case for an expanded business in the future. What is relevant now is the industry of the employer and the work actually performed by the employees.
While it is not necessary to deal specifically with the Cleaning Award, it is abundantly clear based on the evidence before the Commission that Spec Services is an employer in the contract cleaning services industry, defined as the business of providing cleaning services under a contract, and there are classifications under the Cleaning Award that cover the work performed by its employees engaged in cleaning duties. The Cleaning Award operates to the exclusion of any other modern award.
As a result of my finding that Spec Services is not covered by the Award, the answer to the question for determination is no. The dispute is so determined.
DEPUTY PRESIDENT
Appearances:
T Fischer for Construction, Forestry, Maritime, Mining and Energy Union.
A Spivey for KM Hale Pty Ltd T/A Spec Services.
Hearing details:
2022.
By video:
August 18.
[1] (2002) 122 IR 387.
[2] [2019] FWCFB 3874.
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