Domain Aged Care (QLD) Pty Ltd and DPG Services Pty Ltd T/A Opal Aged Care

[2018] FWC 7061

[2018] FWC 7061

FAIR WORK COMMISSION

DECISION

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

Domain Aged Care (QLD) Pty Ltd and DPG Services Pty Ltd T/A Opal Aged Care
(AG2018/1129)

COMMISSIONER MCKINNON MELBOURNE, 19 NOVEMBER 2018

Application for approval of the Opal Aged Care (QLD) Enterprise Agreement 2017.

Introduction

[1] An application has been made for approval of a single enterprise agreement known as the Opal Aged Care (Qld) Enterprise Agreement 2017 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act) by Domain Aged Care (Qld) Pty Ltd and DPG Services Pty Ltd trading as Opal Aged Care (Opal). It is made with relevant employees as well as The Australian Workers’ Union (AWU), the Australian Municipal, Administrative, Clerical and Services Union (Together) and the Australian Nursing and Midwifery Federation (ANMF).

[2] On 21 March 2018, the ANMF advised that it did not support approval of the Agreement. The grounds for objection are comprehensive and it is necessary to deal with each in turn. The other bargaining representatives for the Agreement are the Australian Workers’ Union, Together and employee bargaining representatives.

[3] The Commission separately identified certain matters in relation to the pre-approval requirements, the National Employment Standards (NES) and the better off overall test.

[4] A hearing was held in the matter on 17 and 18 October 2018. This decision deals with the application for approval.

Explanation of Agreement and Provision of Voting Information

[5] Additional information was sought from Opal about how the terms of the Agreement, and the effect of those terms, were explained to employees as well as in relation to the provision of voting information. Opal has provided additional submissions and supporting documentation in response. The information provided by Opal in support of its application satisfies me that the pre-approval steps required in connection with the making of the Agreement have been met and that the Agreement has been genuinely agreed to by the employees.

Agreement coverage

[6] The ANMF says the Agreement does not cover any employees and accordingly, it cannot be approved. It points to the text of the coverage clause at clause 4 of the Agreement, which provides for facilities of Opal to be covered but does not expressly refer to employees working in those facilities.

[7] It was put, and accepted by the ANMF, that bargaining for the Agreement proceeded on the basis that the Agreement would cover relevant employees in the facilities mentioned in clause 4. No party submitted that any person had any different understanding on that issue and the position of the parties is consistent with the information contained in the Notice of Employee Representational Rights (the Notice).

[8] Opal has applied to amend clause 4 under section 586 of the Act to ensure that the intended operation of the Agreement as one that covers relevant employees is expressly stated. I find that the parties intended to bargain for an enterprise agreement covering employees in the classifications, and working in the facilities, set out in both the Notice and the Agreement. It is in the interests of certainty that the Agreement make that clear. I will grant the amendment sought by Opal.

National Employment Standards

[9] The Agreement provides for terms dealing with matters that are also dealt with in the National Employment Standards (NES) in a way that potentially excludes the NES, including in relation to abandonment of employment and paid no safe job leave. However, the Agreement provides at clause 6 that the NES prevails over the Agreement to the extent that the NES is more favourable. I am satisfied that the Agreement does not exclude the NES.

[10] The ANMF says that to the extent the Agreement contravenes the NES, it also fails the better off overall test. The submission seems to assume that modern awards, insofar as they reference the NES, also incorporate its terms. I do not accept the premise of the submission. In any event, clause 6 of the Agreement remedies any potential concern in this regard.

[11] I am satisfied that clause 29.1 of the Agreement defines shift workers for the purposes of the NES, both in relation to the Aged Care Award 2010 1 (Aged Care Award) and the Nurses Award 20102 (Nurses Award).

[12] In addition to the matters identified above, the ANMF says the Agreement cannot be approved because of the range of concerns set out below.

Unlawful terms

[13] The ANMF says that clause 32.3(b)(iii) of the Agreement is an unlawful ‘objectionable’ term because it allows Opal to require evidence in support of an employee’s claim for annual leave, public holiday, rostered days off or personal leave with the result that employees are required to spend time obtaining the requisite evidence, reducing their leisure time and increasing their costs. The argument has no merit. The Act expressly contemplates the provision of evidence in support of an employee’s entitlement to be absent for a range of reasons, including annual leave, personal leave and public holidays. It is not adverse action to request evidence in support of a claim for authorised absence from work.

[14] The ANMF also says clause 37(e) of the Agreement is an unlawful ‘objectionable’ term because paid no safe job leave is deducted from an employee’s entitlement to paid maternity leave. It says the reduction is the taking of adverse action because an employee has exercised their workplace right to paid maternity leave. The argument is rejected. Paid maternity leave is an over-award entitlement provided for in the Agreement, and the parties have agreed that the value of paid maternity leave is to be discounted for any amount of paid no safe job leave taken. The term must be read as a whole and on a fair reading, it is not an objectionable term.

[15] The ANMF also suggests that clause 37(e) of the Agreement is discriminatory on the grounds of parental responsibilities. I do not agree. If anything, the term exceeds the safety net in a way that is beneficial to parents who are eligible for the entitlement it confers.

[16] I am not satisfied that the Agreement contains unlawful terms.

Better Off Overall Test

[17] The ANMF says the long list of ‘less beneficial’ Agreement terms listed in Opal’s Form F17 statutory declaration filed with this application means that the Agreement does not pass the better off overall test. I do not accept the submission. The better off overall test is a weighing up exercise, taking into account both benefits and detriments provided to employees in the Agreement compared to relevant modern awards. The identification by an employer of certain terms as ‘less beneficial’ in the Form F17 is required by the Commission to assist it with that evaluative task. It is wholly appropriate that such a response be provided and it is not the case that the identification of less beneficial terms ‘per se’ results in a failure to pass the better off overall test.

[18] The relevant modern awards for the purposes of the better off overall test in relation to the Agreement are the Nurses Award and the Aged Care Award.

Rates of pay

[19] I am satisfied that the rates of pay in the Agreement are generally higher than the rates of pay in the Nurses Award and the Aged Care Award and that the rates are sufficiently certain to enable a comparison with relevant modern award rates for the purposes of the better off overall test.

[20] The rates of pay for ‘Nursing Assistant – No Qualification’ in the Agreement will, however, result in employees employed in that classification after three years receiving lower rates of pay than provided in the Nurses Award. Opal has offered an undertaking to address the concern.

[21] The rate of pay for casuals working on public holidays is unclear in the Agreement and an undertaking has been offered to address the concern.

[22] There is a dispute between the parties about whether the 25% casual loading is paid on all hours worked under the relevant modern awards, including where other loadings or penalties are paid. Opal says the casual loading is only paid on ordinary hours of work while the ANMF says the casual loading compounds on other penalties including overtime (but not shift allowances). The ANMF says as a result, the Agreement is less beneficial than the relevant modern awards.

[23] Clause 10.5 of the Agreement provides for the casual loading to be paid on ordinary hours. Shift, public holiday and weekend penalties are calculated on the ordinary rate of pay excluding casual loading and the casual loading is then added to the penalty rate of pay. The casual loading is not compounded by penalties in the Agreement.

[24] Clause 10.4 of the Nurses Award is similar to the Agreement. Casual employees are paid an “hourly rate equal to 1/38^th of the weekly rate appropriate” to their classification “plus a casual loading of 25%”. Shift allowances are calculated on the ordinary rate of pay excluding casual loading, with the casual loading then added to the penalty rate of pay. Weekend and public holiday penalties are calculated on the loaded casual rate of pay, which is the “ordinary rate of pay” for casual employees (clauses 10.4, 26 and 32). Overtime penalties are also paid on the loaded casual rate of pay because the Award simply provides for “time and a half”, “double time” and “double time and a half” as the case may be (clause 32) and does not exclude payment of casual loading on those rates.

[25] Clause 10.4 of the Aged Care Award provides for casual employees to be paid 1/38^th of the appropriate weekly rate plus “a loading of 25% of that rate” “instead of the paid leave entitlements accrued by full-time employees”. A plain reading makes clear that the 25% loading is a separate hourly entitlement for casual employees, calculated on the ordinary rate of pay. It is not payable for ordinary hours worked on a weekend or public holiday (clauses 23 and 29(c)). Overtime is paid at the applicable rate of “time and a half”, “double time” or “double time and a half”. The overtime penalty is calculated on the ordinary rate (that is, ordinary rate x time and a half (or other applicable penalty)). The additional casual loading of 25% of the ordinary rate of pay per hour worked also applies to overtime.

[26] The result, using the classifications of Assistant in Nursing – Advanced and Aged Care Employee Level 2 as examples, is as follows:

Assistant in Nursing – Advanced

Agreement	Nurses Award	Difference
Ordinary hourly rate	$ 24.63	$ 21.29	$3.34
Casual hourly rate	$ 30.79	$ 26.62	$4.17
Overtime (1.5)	$ 36.95	$ 39.92	-$ 2.98
Overtime (2)	$ 49.26	$ 53.23	-$ 3.97
Overtime (2.5)	$ 61.58	$ 66.54	-$ 4.96
Shift work – night	$ 35.41	$ 30.61	$4.80
Saturday*	$ 46.18	$ 39.92	$6.26
Sunday	$ 53.88	$ 46.58	$7.31
Public holiday**	$ 61.58	$ 53.23	$8.34

*Agreement rate for employees employed on or after 18 December 2014

**Agreement rate for ordinary hours of work; excludes work at Caloundra and Nambour

Aged Care Employee Level 2

Agreement	Aged Care Award	Difference
Ordinary hourly rate	$ 21.44	$ 20.25	$1.19
Casual hourly rate	$ 26.80	$ 25.31	$1.49
Overtime (1.5)	$ 32.16	$ 35.43	-$ 3.27
Overtime (2)	$ 42.88	$ 45.56	-$ 2.68
Overtime (2.5)	$ 53.60	$ 55.68	-$ 2.08
Shift work – night	$ 30.82	$ 28.35	$2.47
Saturday*	$ 40.20	$ 30.37	$9.83
Sunday	$ 46.90	$ 35.43	$11.47
Public holiday**	$ 53.60	$ 50.62	$2.98

*Agreement rate for employees employed on or after 18 December 2014

**Agreement rate for ordinary hours of work; excludes work at Caloundra and Nambour

[27] The rates of pay under the Agreement for ordinary hours of work, shift work, weekend work and public holidays are in excess of the rates of pay in the relevant modern awards. The rates of pay for overtime under the Agreement are lower than the rates of pay under the relevant modern awards. As the majority of an employees’ hours of work are ordinary hours (as opposed to overtime), the higher ordinary hourly rates of pay are generally adequate to compensate for detriments arising from the lower overtime rates of pay. However, for Aged Care Employees working more than 12 hours per day, they are not.

Allowances

[28] The ANMF says that some of the allowances in the Agreement are less beneficial to employees than the allowances in the Nurses Award. Specifically, it refers to the ‘remain on premises’ allowance, the uniform and laundry allowances and the timing of payment of the meal allowance. Opal submits that the uniform and laundry allowances are incorporated into hourly rates of pay.

[29] I accept that the ‘remain on call’ allowance is less beneficial in the Agreement than the Nurses Award, including because it is limited only to registered and enrolled nurses and the overtime payment is limited to the period of the meal break. If the intention is to limit any requirement to remain on call during meal breaks to registered and enrolled nurses in charge of a facility, an undertaking can be provided to that effect.

[30] I do not accept the submission that payment of the meal allowance in an employee’s ordinary pay cycle rather than on the day the entitlement accrues is an overall disadvantage.

[31] The value of the uniform and laundry allowance equates to approximately $0.20 cents per hour, per week. On balance I consider the rates of pay are sufficient to compensate for the incorporation of those allowances.

Overtime

[32] A concern was identified in relation to whether terms dealing with overtime for part-time employees are less beneficial than the Aged Care Award. Opal has made submissions addressing the issue and pointing to the restriction in the Agreement that no employee will be directed to work in excess of their rostered ordinary hours.

[33] The ANMF says the overtime provisions in the Agreement are less beneficial than in the Nurses Award. I have already dealt with overtime rates of pay above. Overtime for part time employees is less beneficial in the Agreement than the relevant modern awards and Opal has offered undertakings to address the concerns. I do not agree with the ANMF that the first sentence of subclause 26.1(a) does not make sense, and is thus unenforceable. It may not be precisely drafted, but that is a common feature of enterprise agreements. Its meaning can be ascertained by reference to ordinary principles of construction, if necessary, at the appropriate time. In the meantime, I do not consider that the requirement for overtime to be approved before it is worked is a departure from the terms of either relevant modern award. Limiting that requirement to only ‘where practical’ operates to lessen that requirement in recognition that it will not always be practical to expressly approve overtime in advance.

[34] It is not the role of the Commission, at the time of dealing with an application for approval of an enterprise agreement, to form a view as to whether each and every of its terms is enforceable. I do not agree with the ANMF submission that the mere suggestion that a term is unenforceable means that an Agreement is less beneficial than the relevant modern award. Clause 22 and clause 26.4 of the Agreement interact with each other and the plain words of each term explain how they do so. The interaction rules do not invalidate the terms.

Shift work

[35] The hours of work and allowances payable for shift work appear less beneficial to some groups of employees compared to the relevant modern awards. Undertakings have been offered to address the concerns.

[36] The ANMF says that the Agreement does not contain any penalty for night shift because it defines night shift as one that “commences prior to 6.00am or finishes subsequent to 6.00pm”. It says the definition must be read so that the reference to 6.00am and 6.00pm each fall on the same calendar day. There is no warrant to apply such a limited interpretation of the clause.

Annual leave

[37] The amount of annual leave for shift workers and Registered Nurses Level 4 and 5 under the Agreement is one or two weeks less than their entitlement under the Nurses Award, depending on whether they are shift workers. The ANMF puts a value of 1.92% of the hourly rate on one week’s annual leave (in the range of $0.42-$0.98 per hour). Opal says this detriment is offset by the rate of pay for employees. The ANMF agrees that the rates of pay are set at a level about this additional amount but says the value of annual leave is more than monetary and the detriment is not offset by the difference in rates of pay. I accept that annual leave has more than a monetary value but for the purposes of the better off overall test, the intangible benefits of rest and recreation are hard to quantify. The most certain approach is to compare what can be quantified, which in this case is both the amount of leave and the monetary value of that leave if not taken. I am satisfied that the detriment is compensated by way of higher hourly rates of pay for affected employees.

[38] The Agreement does not limit the cashing out of annual leave to two weeks in the same way as the relevant modern awards. I am not satisfied that the omission is a detriment to employees in circumstances where the minimum retained balance is the same in both the Agreement and the modern awards.

[39] There are fewer safeguards concerning the taking of excessive annual leave in the Agreement compared to each relevant modern award. Undertakings have been offered to address the concern.

Dispute resolution

[40] The ANMF says a requirement for work to continue under the Agreement’s dispute resolution term in accordance with the Agreement, the Act and workplace custom and practice is less beneficial than the relevant modern awards. It points to the potential for workplace custom and practice to be inconsistent with another term of the Agreement. Self-evidently, the argument cannot be sustained because such work must be ‘in accordance with the Agreement’ as well as the Act and any relevant workplace custom and practice.

Withholding of wages on resignation

[41] The ANMF says the Agreement is less beneficial than the Nurses Award because an employee who does not give the required notice of termination can have more than one day’s wages withheld, which it says is the maximum deduction provided by the Nurses Award. I am unable to discern the source of the ANMF’s assertion that the Nurses Award limits the deduction to one days’ wages. In each of the Nurses Award and the Aged Care Award, the amount of wages that can be withheld in the event of notice not given by an employee is equivalent to the amount of notice required of an employer.

[42] Clause 11.2 of the Agreement does not specify that the amount of notice that can be deducted is reduced by any notice given by the employee. To that extent it may be seen to operate as a detriment. On the other hand, the Agreement is more beneficial than the Award, because withholding of notice not given can only occur with the written consent of the employee. On balance, I consider it appropriate that Opal be given an opportunity to clarify that the amount of notice that can be withheld from an employee’s final pay is reduced by any period of notice actually given.

Payment of wages

[43] The ANMF says that the Agreement is less beneficial than the Nurses Award because it precludes Opal from liability for delays in payment of wages caused by unforeseen events outside of its control and provides for payment of wages on the next business day after a public holiday, if payday falls on a public holiday. I do not consider that the Agreement is less beneficial in this respect. Nor do I accept that an obligation to ‘make payment’ equates to an obligation that such payment be simultaneously received. The concepts of payment and receipt are separate and distinct and there is no basis to find otherwise.

Rosters

[44] The ANMF says the Agreement is less beneficial because it denies relieving staff a set roster and in so doing, allows Opal to designate employees as ‘relieving staff’ and require them to work at any time of day or night without notice. I do not accept that the Agreement confers a detriment in this regard. The Agreement does not separately provide for a category of “relieving staff” but, as the name suggests, employees in that category are employees who are replacing another employee on the roster for whatever reason. It may not always be feasible for a roster to anticipate short term or relief arrangements in advance. Clause 23 of the Agreement simply reflects that practicality. It must be read in conjunction with other terms of the Agreement, including clause 46 which provides for safe staffing arrangements and replacement of staff absences as well as access to the dispute resolution procedure where necessary.

Meal and tea breaks

[45] The ANMF says that the meal and tea break provisions of the Agreement are less beneficial than the Nurses Award because they are required to be taken at a time that will not interfere with the continuity of work and employees are required to stay in the vicinity of their facility during tea breaks. While I accept that the Nurses Award does not contain equivalent terms, it does provide for tea breaks to be taken at a time agreed with the employer. Tea breaks are ten minute breaks, or by agreement, a single twenty minute break. It is difficult to see how employees could leave the work ‘vicinity’ and be back in time to resume work at the end of their break, all in ten or even twenty minutes. There is no evidence before me as to how that might be so. I am not satisfied that the Agreement is detrimental to employees in this respect.

Compulsory training

[46] The ANMF says that a requirement for employees to attend compulsory training each twelve months is detrimental to employees because there is no equivalent requirement in the Nurses Award, and employees are exposed to a pecuniary penalty if they fail to meet the obligation. That is not a relevant consideration for the purposes of the better off overall test.

[47] Clause 40.2(c) is effectively a disciplinary process that applies when an employee has failed to attend their second compulsory training opportunity. I am not satisfied that its inclusion in the Agreement means that the better off overall test is not met.

[48] I accept that the rates of pay for training are potentially less beneficial to employees under the Agreement than rates of pay under the relevant modern awards, because compulsory training can be scheduled at times that, if worked, would be considered to be overtime. In my view the detriment is outweighed by a number of more beneficial terms in the Agreement.

Compulsory meetings

[49] The rates of pay for employees who are required to attend work health and safety committee and/or board of management meetings are also potentially less beneficial to employees under the Agreement than the rates of pay under the relevant modern awards, because compulsory meetings might be scheduled at times that, if worked, would be considered to be overtime. At the same time, participation in those forums is often voluntary and invariably broadens the skills and experience of employees. In my view the detriment is outweighed by a number of more beneficial terms in the Agreement.

Police checks

[50] The ANMF says that the requirement in clause 42 of the Agreement for employees to obtain a police check as a condition of employment is less beneficial than the Nurses Award. Opal is then required to cover the cost of police check renewals, which it says must be obtained every three years. I do not accept that the term is less beneficial than the Award. It strikes a balance between Opal and its employees. While employees have an upfront cost in obtaining police checks, Opal acquires the ongoing cost of maintaining the currency of the renewals.

Classification definitions

[51] The ANMF says that classification definitions in the Agreement are different to those in the Award and that all of the differences are less beneficial except in relation to Advanced Practice classifications. No evidence or substantive comparative material to support the contention was provided in support of the submission. My impression is that differences between the descriptions in the Agreement and the Award tailor those descriptions to Opals’ operational setting. There is a clear distinction, both in the Agreement and the relevant modern awards, between the classifications of Assistant in Nursing and Aged Care Employee. The Aged Care Employee classifications are clearly derived from the classifications in the Aged Care Award. On the material before me, I am not satisfied that the classification definitions mean that employees are not better off overall.

Long service leave

[52] It is not necessary to deal with whether the Agreement is less beneficial to employees than relevant long service leave legislation because any such term of the Agreement will have no effect.

More beneficial terms

[53] The Agreement contains terms that are more beneficial than the relevant modern awards, including in relation to rates of pay and allowances, shift work, Easter Saturday and Sunday public holidays, salary packaging of superannuation, police checks, community service leave, special disaster leave, jury duty, learning and development, paid parental leave, redundancy, casual conversion after 26 weeks and support for employees experiencing domestic violence.

Undertakings

[54] Opal has given draft undertakings in relation to the Agreement as referred to above. The remaining issues identified in this Decision, for which undertakings are also necessary, are in relation to:

•  overtime for Aged Care Employees;

•  the amount of notice that can be deducted from an employee’s final pay; and

•  remain on call allowance.

[55] Opal will be given an opportunity to provide final signed undertakings in relation to each of the matters identified so that I can be satisfied that the Agreement passes the better off overall test. I am otherwise satisfied that the Agreement was genuinely agreed and that each of the requirements in ss.186, 187 and 188 as are relevant to this application for approval have been met.

[56] Finally, I would observe that it is not an efficient use of the Commission’s resources to mount such a comprehensive attack on the terms of an enterprise agreement where the agitator was involved in bargaining and many of the concerns now raised are either seeking to re-agitate unsuccessful bargaining claims, or speculative, or without merit. It is unfortunate that the parties were unable to narrow the issues in dispute prior to the hearing for the benefit of all concerned.

Directions

[57] Opal is directed to provide any further undertaking in relation to the matters identified in paragraph [54] of this Decision within 7 days, together with a final consolidated undertaking signed in accordance with the Fair Work Regulations 2009. Bargaining representatives are directed to provide any views on the further undertakings received within 14 days.

[58] The application will then be determined.

COMMISSIONER

Appearances:

O Fagir of Counsel for Domain Aged Care (QLD) Pty LTd

K Crank for the Australian Nursing and Midwifery Federation

Hearing details:

2018.

Melbourne and Brisbane (video link):

October 18 and 19.

Printed by authority of the Commonwealth Government Printer

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