Construction, Forestry, Mining and Energy Union v Southern Star Windows Pty Ltd

[2017] FWC 2274

[2017] FWC 2274

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739 - Application to deal with a dispute

Construction, Forestry, Mining and Energy Union
v
Southern Star Windows Pty Ltd
(C2016/5154)

DEPUTY PRESIDENT GOSTENCNIK MELBOURNE, 27 APRIL 2017

Application to deal with a dispute in accordance with the dispute settlement procedure in an agreement; interpretation of agreement; entitlement to a meal allowance; notice of overtime; whether exception to the requirement to pay a meal allowance in clause 27.6(a)(i) is satisfied by posting a roster specifying that overtime work may be required the following day.

Introduction

[1] The Construction, Forestry, Mining and Energy Union (Applicant) and Southern Star Windows Pty Ltd (Respondent) are each covered by the Southern Star Windows Enterprise Agreement 2013 (Agreement), the nominal expiry date of which has passed. The Agreement remains in operation by reason of ss.54 and 58 of the Fair Work Act 2009 (Act). The Respondent manufactures aluminium doors and windows at a production facility in North Geelong, predominately for the housing industry. It employs approximately 130 employees in the production process. The Agreement applies to these employees.

[2] The Respondent also operates a separate dispatch facility in North Geelong located approximately one kilometre in distance from the production facility. 1 The Respondent employs 32 employees including drivers at the dispatch facility. The Agreement also applies to these drivers, who are engaged as day workers and classified as transport driver employees under the Agreement.2

[3] By its application lodged on 29 August 2016, the Applicant applied to the Fair Work Commission (Commission) pursuant to s.739 of the Act for the Commission to deal with a dispute in accordance with the dispute settlement procedure in the Agreement. There is no dispute between the Applicant and the Respondent that the jurisdiction of the Commission has been properly invoked and that I am able to resolve the dispute by exercising arbitration power for which provision is made in clause 8 of the Agreement.

Issue in dispute and synopsis of competing contentions

[4] The dispute concerns the construction of the Agreement in so far as it relates to the payment of a meal allowance in circumstances where a driver employee works overtime hours. The parties in dispute have agreed that the dispute may be resolved by the Commission determining the following question:

In what circumstances is an employee considered to have been notified within the meaning of clause 27.6 of the Southern Star Windows Enterprise Agreement?

[5] The Applicant contends that some affected employees have on several occasions over a number of years during the operation of the Agreement worked overtime hours, without being ‘notified’ on the previous day that they would be so required. The Applicant contend that contrary to clause 27.6(a) of the Agreement, these employees have not been paid a meal allowance when they were so entitled, namely on each occasion the relevant affected employee was entitled to a rest break before or after completing the requisite amount of overtime hours. 3

[6] The Respondent contends that the relevant affected employees have been and are being appropriately notified of the requirement to work overtime hours on the day prior to being required to so work, and therefore rely on the exception to the requirement to pay a meal allowance in clause 27.6(a)(i) of the Agreement.

[7] As is apparent from the question posed by the parties, the resolution of the question turns upon the proper construction of the Agreement and in particular, upon the meaning of the words “was notified” in clause 27.6(a)(i) of the Agreement.

Some relevant factual context

[8] Before turning to consider the provision at issue, it is necessary to set out some relevant factual contextual matters which does not appear to be in serious dispute.

[9] As indicated above, the drivers are day workers under the Agreement. Ordinary hours by these drivers are worked between 5:00am and 1:30pm on Mondays through Fridays. 4 Presumably the 5:00am start is the product of a relevant agreement as contemplated by clause 23.1(c) of the Agreement with the result that the commencing time for the spread of hours within which ordinary hours may be worked has been altered by one hour from 6:00am to 5:00am.

[10] The Respondent undertakes a daily assessment of the items of stock that have been manufactured and are ready for delivery the following day. 5 The Respondent employs a dispatch co-ordinator whose responsibilities include preparing a schedule of the deliveries ready for dispatch. Once prepared, the delivery schedule records, inter alia, each type of delivery, the number of items to be delivered with each delivery, and the delivery location.6

[11] The delivery schedule also divides the deliveries into numbered loads. 7 A roster is then prepared allocating these loads to individual drivers. The Respondent also employs a dispatch supervisor, whose role includes the preparation of the aforementioned roster.

[12] Before the dispatch supervisor can prepare the roster, it is necessary to calculate the estimated delivery time for each load. The delivery time calculation for each load is made using the following method 8:

● the load details are entered into a Microsoft Excel spreadsheet containing a formula that takes into account the volume and type of items for delivery in order to estimate the time required to unload the item or items for delivery;
● a Google Maps search is undertaken to estimate the driving time related to the delivery of each load; and
● ten minutes is then added to the estimated total time derived from the above to account for any disparities.

[13] Once the time for each delivery is estimated, the loads are divided into groups, each of which is then allocated to an individual driver as that driver’s run for the following day. Each run is prepared having regard to the estimated duration of each delivery and the location or destination for each delivery. The Respondent’s goal is to ensure that each run assigned to drivers requires the delivery of loads which in total delivery time will not exceed eight hours. 9

[14] The goal notwithstanding, overtime is sometimes necessary in order that deliveries are completed. 10 The situation with drivers required to deliver loads to regional Victoria or interstate is an exception with overtime being the unavoidable consequence of the distance necessary to be travelled in order that a delivery is made. A driver allocated a regional or interstate load will therefore know the length of the shift including overtime as the delivery time is set out in the runs.11

[15] Once the runs are prepared, they are each allocated to a driver and this forms the roster. 12

[16] A roster for each following day is usually finalised by 12.30pm on the day prior and it sets out details of each load, an estimate of the total trip time for each run, and the name of the driver to whom each run has been allocated. 13

[17] The estimated run times in the roster do not allow for down time, that is, any unforeseen delays such as, poor access or blocking of access at a site, break-downs, traffic delays, and difficulties encountered by drivers in locating delivery sites. Down time encountered during a delivery is nonetheless part of a driver’s hours worked. 14
[18] The roster is posted in two locations:

● at the dispatch office, at which a driver is required to deliver paperwork at the end of each day; and
● on a table in the dispatch area floor. 15

[19] Each driver is required check the roster when returning from a run, which might be at any time between 12.30pm and 7.00pm. 16

[20] The Respondent has suggested that when a driver checks the roster, the driver can see the estimated run time related to that driver’s allocated run for the following day and will understand that where a run lists a delivery time of seven hours or greater, there is a risk that the driver will be required to work overtime in the event that the driver encounters any substantial down time over that day. 17

[21] The roster is the vehicle through which a driver is notified that there may be a requirement to work overtime the following day. The Respondent says that it cannot provide a more definitive total trip time given that there are many factors which may cause down time and these are outside of its control. 18

[22] The Respondent operates a system where by a driver will opt out of the option of working overtime on any given day. The roster contains notices including the following 19:

“IF YOU REQUIRE AN EARLY DAY THEN PLEASE ADVISE MATT AT LEAST THE DAY PRIOR.”

[23] On some occasions during busy periods, drivers will be notified of a general requirement that they work overtime. The Respondent pointed to a notice it says it issued on 22 July 2016 as follows 20:

“ATTENTION: ALL DRIVERS AND JOCKEYS

DUE TO THE CURRENT BUSY PERIOD IN DESPATCH ALL EMPLOYEES ARE ADVISED THAT THEIR RUN FOR EACH DAY MAY INCLUDE OVERTIME UNTIL FURTHER NOTICE

IF YOU HAVE ANY APPOINTMENTS/REQUIREMENTS TO BE FINISHED AT A CERTAIN TIME YOU MUST ADVISE YOUR SUPERVISOR”

Consideration

[24] The principles applicable to the proper construction of an enterprise agreement are not in dispute and were canvassed at length in Australasian Meat Industry Employees Union v Golden Cockerel Pty Limited. 21 These need not be rehearsed at length here. However, in short compass, much like the approach to construing a statute, the construction of an enterprise agreement begins with a consideration of the ordinary meaning of the words used, having regard to the context and evident purpose of the provision or expression being construed. Context may be found in the provisions of the agreement taken as a whole, or in their arrangement and place in the agreement being considered. The statutory framework under which the agreement is made may also provide context, as might an antecedent instrument or instruments from which particular provisions might have been derived.

[25] Clause 27 of the Agreement deals with overtime and related matters. It provides the following:

“27. OVERTIME

27.1 Overtime- day workers

27.1.1 Except as provided in 27.1.2 and 27.1.3 hereof, all work done by day workers:

27.1.1(a) before or after the usual time of beginning or ending work; or

27.1.1(b) in excess of eight hours per day;

shall be paid at the rate of time and one half for the first two hours on any one day and at the rate of double time thereafter, such double time to continue until the completion of the overtime work on that day.

27.1.2 Notwithstanding anything contained in 27.1.1 and 27.1.3 hereof, all time worked between 9.00 p.m. and 6.00 a.m. shall be paid at the rate of double time.

27.1.3 Notwithstanding anything contained in 27.1.1 hereof, work performed on a Saturday shall be paid for at the rate of time and one half for the first two hours and double time thereafter. Provided that any work performed after 12 noon on a Saturday shall be paid for at the rate of double time.

27.2 Rest period before re-commencing work

27.2.1 When overtime work, including work on a Sunday or holiday, is necessary, it shall, wherever reasonably practicable, be so arranged that an employee works not more than 14 hours in any period of 24 consecutive hours and so that each employee may have at least 10 consecutive hours off duty in each such 24 consecutive hours.

27.2.2 Subject to the exceptions referred to in 27.4 hereof as to call backs of less than three hours, when an employee (other than a casual employee) finishes a period of work, he/she shall, subject to this sub-clause be released until he/she has had ten consecutive hours off duty without loss of pay for his/her ordinary working time occurring during such absence.

27.2.3 If, on the instructions of his/her employer, such an employee resumes or continues work without having had such ten consecutive hours off duty he/she shall be paid at the rate of double time until he/she is released from duty for such period and he/she shall then be entitled to be absent until he/she has had ten consecutive hours off duty without loss of pay for ordinary working time occurring during such absence.

27.3 Reasonable overtime

27.3.1 An employer may require an employee to work reasonable overtime at overtime rates and such employee shall work overtime in accordance with such requirement.

27.4 Call back

27.4.1 An employee recalled to work overtime after leaving his/her employer's business premises (whether notified before or after leaving the premises) shall be paid for a minimum of three hours work at the appropriate rate for each time he/she is so recalled.

27.4.2 Provided that except in the case of unforeseen circumstances arising an employee shall not be required to work the full three hours if the job he/she was recalled to perform is completed within a shorter period.

27.4.3 The provisions of 27.4.1 and 27.4.2 shall not apply:

27.4.3(a) in cases where it is customary for an employee to return to his/her employer's premises to perform a specific job outside his/her ordinary working hours; or

27.4.3(b) where the overtime is continuous (subject to a reasonable meal break) with the commencement of ordinary working time; or

27.4.3(c) where, from Monday to Friday inclusive, an employee is recalled to work two hours or less, in which case he/she shall be paid for three hours at the rate of time and one half.

27.4.4 Where the actual time worked is less than three hours on such recall or on each of such recalls, overtime worked in the circumstances specified in this subclause shall not be regarded as overtime for the purposes of 27.2 hereof.

27.5 Payment for work on Sundays and holidays

27.5.1 A time work employee who is employed on a holiday prescribed by clause 36-Public Holiday of this Agreement shall be paid for such work at the rate oftime and a half in addition to his usual rate.

27.5.2 All work done on a Sunday shall be paid for at the rate of double time.

27.6 Meal Allowance

27.6(a) An employee is entitled to a meal allowance of $12.73 on each occasion that the employee is entitled to a rest break in accordance with sub clause 27.7, except in the following circumstances:

(i) if the employee is a day worker and was notified no later than the previous day that they would be required to work such overtime;

(ii) if the employee is a shift worker and was notified no later than the previous day or previous rostered shift that they would be required to work such overtime;

(iii) if the employee lives in the same locality as the enterprise and could reasonable return home for meals.

27.6(b) If an employee has provided a meal or meals on the basis that he or she has been given notice to work overtime and the employee is not required to work overtime or is required to work less than the amount advised, he or she shall be paid the prescribed meal allowance for the meal or meals which he or she has provided but which are surplus.

27.7 Rest Break

27.7(a) An employee working overtime must be allowed a rest break of 20 minutes without deduction of pay after each four hours of overtime worked if the employee is to continue work after the rest break.

27.7(b) Where a day worker is required to work overtime on a Saturday, Sunday or Public Holiday or on a rostered day off, the first rest break will be paid at the employee's ordinary rate of pay.

27.7(c) Where overtime is to be worked immediately after the completion of ordinary work on a day or shift and the period of overtime is to be more than one and a half hours, an employee, before starting the overtime is entitled to a rest break of 20 minutes to be paid at ordinary rates.

27.7(d) The employer and employee may agree to any variation of this sub clause to meet the circumstances of the work in hand provided that the employer is not required to make any payment in excess of or less than what would otherwise be required under this sub clause.”

[26] The provision at issue as earlier indicated, is clause 27.6(a)(i) of the Agreement. Clause 27.6(a) sets out an employee’s entitlement to a meal allowance on each occasion that an employee is entitled to a rest break in accordance with clause 27.7. Before turning to the exceptions to the entitlement set out in clause 27.6(a), it is necessary to first consider the circumstances in which the employee will be entitled to a rest break under clause 27.7 in order to properly construe that which is required for the exceptions to apply.

[27] Pursuant to clause 27.7(a) an employee is entitled to a rest break of 20 minutes duration without loss of pay after each period of four hours of overtime worked. Clause 27.7(b) provides for the rate of pay applicable for the period of a rest break during overtime that is worked on a weekend or on a public holiday, and is presently not relevant.

[28] Clause 27.7(c) provides for the circumstance where overtime is worked immediately after the conclusion of ordinary hours of work, in other words, continuously. That clause provides that in the event that overtime “is to be more than one and a half hours,” then before an employee commences the overtime, that employee is entitled to a rest break of 20 minutes, which to be paid at ordinary rates. It is clear from the words I have underlined above, which are taken directly from the text of clause 27.7(c), the fact that the overtime will be more than one and a half hours must be communicated before the overtime is worked. This seems to me self-evident given that the entitlement itself deals with a rest break before an employee commences a period of overtime.

[29] Clause 27.7(d) is in the nature of a facilitative provision, which allows an employer and employee may agree to any variation of this sub clause to meet the circumstances of the work at hand. It is not presently relevant since it is not asserted that such an agreement has been made with the Respondent and any employee affected.

[30] Returning then to clause 27.6(a) and in particular the exception in clause 27.6(a)(i). The effect of the exception is that a meal allowance for rest breaks during overtime work is not relevantly payable “if the employee is a day worker and was notified no later than the previous day that they would be required to work such overtime”. The evident purpose of the exception is that, with notice, an employee is able to make appropriate arrangements concerning the provision of a meal for consumption during the rest breaks, for example, by bringing a meal from home. Without notice, a meal may need to be purchased by the employee, hence the allowance.

[31] The exception contains the three requirements. First, the employee must be notified. Secondly, the notification to the employee must occur by no later than the “previous day”, that is the day before overtime is to be worked. Thirdly, the notification must indicate that the employee “would be required to work such overtime”.

[32] There does not appear to be any particular requirement as to the form of notification. It seems to me therefore that an employee is notified for the purposes of clause 26.1(a)(i) if the employer has told the employee, written to the employee, sent a text or email to the employee, or set out in a roster which the employee is required to consult, that the employee will be required to work overtime the following day. Therefore, the mechanism by which the Respondent has chosen to communicate overtime to drivers, that is through the publication of a roster, seems to me to be sufficient generally, for the purposes of the notification requirement of clause 26.1(a)(i). There might be exceptions, for example in respect of an employee who has been absent on some form of leave, and is therefore not in a position to consult the roster before returning to work. Unless some other step is taken to inform such an employee of the requirement to work overtime, then notification by posting a roster will not be notification.

[33] Similarly, that the Respondent publishes a roster each day for runs to be carried out the following day will generally be sufficient for the purposes of discharging the obligation that a driver required for overtime work be notified the day before. As with the requirement to notify, there will be exceptions, so that without more, merely publishing a roster the day before the overtime commences, will not likely be sufficient to discharge the obligation vis a vis a driver who is absent on the day the roster is posted.

[34] The third requirement is more problematic for the Respondent. It seems to me that the words “would be required to work such overtime” connote that when an employee is notified, that notification must be accompanied with a clear statement that the employee will be required to work overtime the following day. Having regard to the evident purpose of the exception, I also consider that the Respondent will need to notify an affected driver of the likely duration of the overtime, at least for the purpose of avoiding a meal allowance on each occasion a rest break would fall due. This is because the evident purpose of the exception would be defeated if an employee were left to guess how many meals he or she needed to provide for an unidentified period of overtime. Thus, where overtime work is required but the period is not specified (at least by reference to the rest breaks for which provision is made in clause 27.7), the Respondent will be liable to pay the requisite meal allowance if a rest break falls due during the overtime.

[35] The words “such overtime” in clause 27.6(a) underscore the requirement that the duration of the overtime by reference to the rest breaks requirement in clause 27.7 is necessary in order to invoke the exception. Remembering that clause 27.6(a) is an exception to the requirement of a meal allowance being paid, the words “such overtime” can only be a reference to such overtime as would require the provision of a rest break for which provision is made in clause 27.7. Having regard for example to clause 27.7(c), notice of whether the overtime required will be more than one and a half hours in duration will be necessary to avoid a meal allowance at the beginning of a period of overtime commencing at the conclusion of a period of ordinary hours of work. Likewise, notice that overtime will be of at least four hours will be necessary to avoid the payment of a meal allowance where overtime worked is of four hours but less than eight.

[36] As I have earlier indicated, the Respondent has suggested that when a driver consults the roster, the driver can see the estimated run time related to that driver’s allocated run for the following day and will understand that where a run lists a delivery time of seven hours or greater, there is a risk that the driver will be required to work overtime in the event that the driver encounters any substantial down time over that day.

[37] In my view, this is not sufficient to avoid the obligation to pay a meal allowance in clause 27.6 because it is merely notification that an employee “may be required to work overtime the following day”. The exception in clause 27.6(a)(i) is engaged only when the employee is notified that he or she “would be required to work” overtime. Thus, notification of the overtime must be certain and not merely circumspect, as appears to be the case with the roster.

[38] Moreover, as a minimum, although the duration of the overtime that would be required to be worked need not be stated with precision, the period of overtime that is to be worked by reference to the rest breaks that would fall due under clause 27.7 will need to be included in the notification if the exception is to be invoked.

Conclusion

[39] For the reasons given above I answer the question posed by the parties as follows:

An employee will be notified for the purposes of clause 27.6(a)(i) if, the day before working a period of overtime, the employee is informed (whether orally, in writing, by electronic means or by the publication of a roster to which the employee has had access), that the employee will on the following day be required to work overtime and the notice includes an indication of the likely duration of the overtime by reference to the rest breaks that will fall due under clause 27.7 during the period of overtime that is to be worked.

[40] The dispute is determined accordingly and no orders are necessary.

DEPUTY PRESIDENT

Appearances:

Ms L Dooley, on behalf of the Construction, Forestry, Mining and Energy Union.

Mr M Reid, Solicitor on behalf of Southern Star Windows Pty Ltd.

Hearing details:

2017.

Melbourne.

2 March.

 1 Respondent’s Outline of Submissions dated 15 February 2017 at [2].

 2   Ibid.

 3 Applicant’s Outline of Submissions dated 1 February 2017 at [4].

 4 Exhibit 1 at [8].

 5 Ibid at [11].

 6 Ibid at [12].

 7 Ibid at [13].

 8 Ibid at [15].

 9   Ibid.

 10 Ibid at [17].

 11 Ibid at [18].

 12 Ibid at [19].

 13 Ibid at [20].

 14 Ibid at [22].

 15 Ibid at [24].

 16 Ibid at [25].

 17   Ibid [26] – [27].

 18   Ibid at [28]

 19 Ibid at [29].

 20 Ibid at [30].

 21   [2014] FWCFB 7447.

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