DPG Services Pty Ltd T/A Opal HealthCare

Case •

[2025] FWC 631

•

4 MARCH 2025
[2025] FWC 631

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.318 - Application for an order relating to instruments covering new employer and transferring employees

DPG Services Pty Ltd T/A Opal HealthCare

(AG2025/406, AG2025/407, AG2025/408 and AG2025/409)

COMMISSIONER SLOAN

SYDNEY, 4 MARCH 2025

Application for orders under s 318 of the Fair Work Act 2009

  1. DPG Services Pty Ltd t/as Opal HealthCare entered into an arrangement to purchase and take over the following residential aged care facilities (“Facilities”) with effect from 3 March 2025:

  2. “Bayswater Gardens” in Abbotsford, New South Wales, currently operated by Cranbrook Care (Bayswater Gardens) Pty Limited;

  1. “Lansdowne Gardens” which operates at sites at Manns Avenue and Wycombe Road, Neutral Bay, New South Wales. Those facilities are currently operated by Cranbrook Care (Lansdowne Gardens) Pty Limited;

  1. “Bella Vista Gardens” at Kellyville, New South Wales, currently operated by Cranbrook Care (Bella Vista Gardens) Pty Limited; and

  1. “William Cape Gardens” at Kanwal, New South Wales, currently operated by Cranbrook Care (William Cape Gardens) Pty Limited.

  1. For convenience, I will refer to the Cranbrook Care entities collectively as “Cranbrook Care”.

  2. Opal HealthCare offered employment to approximately 675 employees that Cranbrook Care employed across the Facilities (“Cranbrook Employees”). It anticipated that those who accepted such offers (“Transferring Employees”) would commence employment with Opal HealthCare on or within three months after 3 March 2025.

  3. In their employment with Cranbrook Care, the Cranbrook Employee were covered by the Cranbrook Care HSU and NSWNMA and ANMF NSW Branch Enterprise Agreement 2023 (“Cranbrook Agreement”). Employees of Opal HealthCare in New South Wales are covered by the Opal HealthCare (NSW) Enterprise Agreement 2023 (“Opal Agreement”).

  4. On 19 February 2025, Opal HealthCare made four applications for orders under s 318 of the Fair Work Act 2009, one for each of the Facilities (“Applications”). The Applications sought orders that the Cranbrook Agreement would not cover Opal HealthCare or any Transferring Employee following the acquisition, and that the Opal Agreement will cover any Transferring Employee.

Determination

  1. On 28 February 2025 I issued orders in respect of each of the Applications, to the effect sought by Opal HealthCare.[1] I did so in advance of issuing a decision, being cognisant that the acquisition was due to take effect on 3 March 2025. I informed the parties that the reasons for my decision to issue the orders would follow. These are those reasons.

  1. Due to the commonality of the facts and the issues arising in respect of the Applications, it is convenient to deal with them all in this one decision.

Procedural Matters

  1. On receipt of the Applications, I arranged for an email to be sent to Opal HealthCare on 21 February 2025 that invited any Cranbrook Employee to provide their views on the Application relevant to their employment. The email requested that any response be provided to my Chambers by 26 February 2025. The email included directions that Opal HealthCare forward the email to “all employees and employee organisations affected by the order it seeks” and that it confirm compliance with that direction by 25 February 2025.

  2. On 25 February 2025, Opal HealthCare confirmed that it had forward the Commission’s email to the affected employees and unions as directed.

  3. The Commission received communications from three Cranbrook Employees to the following effect:

  4. Mariane Calixtro, Mary Leona and Max Lopez sought clarification as to whether Transferring Employees would continue to be entitled take long service leave after five years of continuous service;

  1. Ms Leona and Mr Lopez also raised a concern that there were differences between the Cranbrook Agreement and the Opal Agreement as to what constitutes “full-time hours”. In effect, by taking up employment with Opal HealthCare, Transferring Employees may go from full-time to part-time status; and

  1. Ms Leona also noted that the Opal Agreement does not allow for the position of Team Leader which is in the Cranbrook Agreement.

  1. The Australian Nursing and Midwifery Federation – NSW Branch (“ANMF”) provided the Commission with submissions in relation to the Applications. The ANMF stated that it was “not fundamentally opposed to the Applications”. However, it detailed what it claimed to be aspects of the offer from Opal HealthCare that were less advantageous than those the Cranbrook Employees enjoy under the Cranbrook Agreement. The ANMF requested that the Commission convene a conference to discuss those matters.

  1. The Health Services Union NSW/ACT/QLD (“HSU”) informed the Commission that it did not intend to raise any objections to the Applications. However, it noted the ANMF had raised issues that “warrant further consideration”. It agreed that a conference to work through any outstanding issues would be appropriate.

  1. I convened a conference on 28 February 2025. Each of Opal HealthCare, the ANMF and the HSU were represented at that conference. I will not traverse all of the matters canvassed. In determining the Applications I had regard to the matters discussed at that conference. To the extent that it is necessary to do so, I deal with those matters below.

The statutory framework

  1. Section 318(1) relevantly provides that the Commission may order that:

  1. a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of s 313(1)(a) does not, or will not, cover them (s 318(1)(a)); and

  1. an enterprise agreement that covers the new employer covers, or will cover, the transferring employee (s 318(1)(b)).

  1. Before making such orders, the Commission must be satisfied that there has been, or that there is likely to be, a transfer of business within the meaning of s 311 of the Act: s 317. I was satisfied that there would be a transfer of business from Cranbrook Care to Opal HealthCare for the following reasons:

  1. the employment of the Transferring Employees with Cranbrook Care will terminate, and within three months (on or soon after the date of the acquisition) they will become employed by Opal HealthCare: s 311(1)(a) and (b);

  1. the work to be performed by the Transferring Employees for Opal HealthCare will be the same, or substantially the same, as the work they performed for Cranbrook Care: s 311(1)(c); and

  1. there is a “connection” between Cranbrook Care and Opal HealthCare. Due to the arrangement between them, Opal HealthCare will own or have the beneficial use of some of the assets that Cranbrook Care owned that relate to, or will be used in connection with, the transferring work: ss 311(d) and 311(3).

  1. Section 318(2) provides that the Commission may only make an order on the application of identified persons or organisations. Opal HealthCare was entitled to bring the Applications, as it is “likely to be the new employer” of the Transferring Employees following the acquisition: s 318(2)(a).

  2. Following the acquisition, the Cranbrook Agreement would become a transferable instrument which will, unless the orders sought by Opal HealthCare were made, cover Opal HealthCare and the Transferring Employees: s 313.

Consideration of the statutory criteria

  1. Section 318(3) sets out the matters that the Commission must take into account in deciding whether to make such an order. I will deal with them in turn.

The views of Opal HealthCare and the employees who would be affected by the orders – s 318(3)(a)

  1. It is perhaps trite to observe that Opal HealthCare supported the Commission making the orders it sought. This was apparent from the terms of the Applications.

  2. Other than Ms Calixtro, Ms Leona and Mr Lopez, none of the Cranbrook Employees offered the Commission their views on the Applications. However, I could reasonably infer that the majority of them did not oppose the Applications, for the following reasons.

  3. First, the Applications described the efforts made by Opal HealthCare, in conjunction with Cranbrook Care, to consult with the Cranbrook Employees. The Cranbrook Employees were provided with information comparing the conditions under the Cranbrook Agreement with those under the Opal Agreement. They were informed of Opal HealthCare’s intention to make the Applications and provided with a draft of the Application relevant to the Facility at which they were employed. The Cranbrook Employees were also provided with a “consent form”, which invited them, amongst other things, to offer a view as to the Commission “allowing” the Opal Agreement to apply to their employment in place of the Cranbrook Agreement.

  4. Of the 675 Cranbrook Employees, 499 returned a consent form. Of those, 436 (or 87.4%) indicated their consent to the Applications. The other 63 raised questions or concerns as to the Opal Agreement applying to their employment, which Opal HealthCare informed the Commission had been or were to be addressed. No Cranbrook Employee raised an objection to the Applications. I observe in this regard that none of Ms Calixtro, Ms Leona and Mr Lopez opposed the Applications. Rather, they sought clarification regarding the terms that would apply to their employment at Opal HealthCare were they to accept employment with it.

  5. The ANMF submitted that the consent forms “should be treated with caution”. I considered those submissions in light of the concerns raised by the ANMF as to the terms that Opal HealthCare has offered to Transferring Employees. I still regarded the consent forms as having some persuasive force.

  1. Second, I was informed at the conference on 28 February 2025 that Opal HealthCare had made offers of employment to all of the Cranbrook Employees. At that date, approximately 90% of those offers had been accepted.

  1. Third, I was of course mindful of the representative function of the ANMF and the HSU. I took into account the matters that the ANMF raised in its submissions. However, neither union opposed the Applications.

  2. The views of Opal HealthCare and the apparent lack of objection from the Cranbrook Employees to the Applications weighed in favour of granting the Applications.

Whether any employees would be disadvantaged by the order – s 318(3)(b)

  1. Opal HealthCare submitted that while there are a number of conditions conferred by the Opal Agreement that are less beneficial than comparable conditions under the Cranbrook Agreement, there are a significant number of equal and more superior conditions under the Opal Agreement, such that a Transferring Employee would not be disadvantaged were the Applications to be granted. Opal HealthCare further submitted that:

  1. Where there is a “direct translation” in classification from one enterprise agreement to another, and the Transferring Employee’s base salary under the Cranbrook Agreement is higher than that under the Opal Agreement, Opal HealthCare will maintain the Transferring Employee’s base salary until the rate under the Opal Agreement equals or exceeds that rate.

  1. Opal HealthCare will apply the July 2025 increases provided for in the Cranbrook Agreement where those increases are more beneficial to Transferring Employees than the increases under the Opal Agreement.

  1. Registered and Enrolled Nurses will continue to receive the entitlement to five weeks annual leave a year provided for in the Cranbrook Agreement, until such time as the Opal Agreement is replaced by a new agreement.

  1. Opal HealthCare will recognise Transferring Employees’ service with Cranbrook Care for all service-related entitlements under the Opal Agreement, and will recognise their accrued annual leave and personal/carer’s leave.

  1. Opal HealthCare will maintain the current hours of work and shift patterns for any Transferring Employee who works part-time. Any changes will be by agreement with the Transferring Employee and recorded in writing.

  1. The Applications were accompanied by a document containing a “side by side” comparison of the terms of the Opal Agreement and the Cranbrook Agreement. That document reveals that in some respects Transferring Employees will be better off, and in others worse off, as a result of the Opal Agreement applying in place of the Cranbrook Agreement. Opal HealthCare maintained that on balance the Transferring Employees would not be disadvantaged.

  2. One area of difference concerned the long service leave issue raised by Ms Calixtro, Ms Leona and Mr Lopez. Their position was that the Cranbrook Agreement allows an employee to take long service leave after five years’ continuous service, which they contended was more beneficial than the terms of the Opal Agreement. Opal HealthCare disagreed that the Cranbrook Agreement provided for the taking of long service leave after five years, although it conceded that this may have been a “policy” adopted by Cranbrook Care in the past.

  1. Had it been necessary, I am likely to have found in favour of the employees on this question. However, I do not need to make a determination on the issue. At the conference on 28 February 2025, Opal HealthCare gave an undertaking that Transferring Employees would be entitled to take long service leave after five years of continuous service.

  1. While the ANMF identified a number of respects in which it contended the Opal Agreement was less beneficial than the Cranbrook Agreement, at the conference on 28 February 2025 its primary focus was on the rates of pay for Registered Nurses at the level “8th year and thereafter”. It argued that the undertaking that had been offered by Opal HealthCare – that it would recognise and maintain the higher rate for transferring employees at that level – did not provide adequate protection for the employees. This was for two reasons. First, the undertaking did not extend to Registered Nurses in their 7th year who would have reached the higher pay point during the term of the Cranbrook Agreement. Second, it did not allow for the wage increase of 3.5% from 1 July 2026 for which the Cranbrook Agreement provides.

  1. Opal HealthCare submitted, and I accepted, that the ANMF did not demonstrate that any employee would in fact be disadvantaged were the Applications granted, but rather posited scenarios in which they might be. But even were I to have assumed the disadvantage asserted by the ANMF, it would not have materially impacted on my decision.

  1. This is because I accepted two submissions made by Opal HealthCare: first, that the issues surrounding the pay rates for Registered Nurses at the level of 8th year and thereafter “would affect a minimal number of employees”; and second, that maintenance of separate rates of pay for Transferring Employees at that level, or for others who might attain that level during the nominal term of the Cranbrook Agreement, would add another layer of administrative complexity to its operations and maintain differences in the terms and conditions being provided to employees at the same level. These outcomes were contrary to the grounds on which Opal Healthcare seeks orders (as dealt with below).

  1. I had regard to the other considerations raised by the ANMF, Ms Leona and Mr Lopez. I was not satisfied that they demonstrated disadvantage for any employee or were material to my decision. 

  2. Overall, there was something of “swings and roundabouts” regarding the application of the Opal Agreement in place of the Cranbrook Agreement. However, having regard to the overall package of terms on offer in the context of the undertakings that Opal HealthCare gave, I was satisfied that the vast majority of Transferring Employees (if not all of them) will not be disadvantaged by the orders. This weighed in favour of granting the Applications.

The nominal expiry date of the Cranbrook Agreement – s 318(3)(c)

  1. The nominal expiry date of the Cranbrook Agreement is 30 September 2026. The nominal expiry date of the Opal Agreement is 30 June 2026. As employees of Opal HealthCare, the Transferring Employees will presumably be able to commence negotiations for a new agreement a few months earlier than they could have done under the Cranbrook Agreement. This factor weighed slightly in favour of the Applications being granted.[2]

Whether the Cranbrook Agreement would have a negative impact on the productivity of Opal HealthCare’s workplace – s 318(3)(d)
Whether Opal HealthCare would incur significant economic disadvantage as a result of the Cranbrook Agreement covering it – s318(3)(e)

  1. It is convenient to deal with these factors together.

  1. I accepted Opal HealthCare’s uncontested submissions that were the Cranbrook Agreement to continue to apply to the Transferring Employees:

  1. there would be inconsistency in the terms of employment applying to employees performing the same duties at the same level. This would not promote a cohesive, equitable and inclusive workplace culture, but could rather lead to dissatisfaction and division. This could in turn negatively impact on productivity and resident care; and

  1. Opal HealthCare would be required to reconfigure its payroll system. In its current form the system would not accommodate the differences in pay and conditions under the two instruments. Unless the system were reconfigured, manual processing would be required, which would necessitate additional resourcing to process and reconcile payments on a fortnightly basis. The reconfiguration and maintenance of a payroll system to support payment and accrual under two instruments would come at a cost, both financial and in management time.

  1. These factors weighed in favour of granting the Applications.

The degree of business synergy between the Cranbrook Agreement and the Opal Agreement – s 318(3)(f)

  1. Opal HealthCare submitted that there was “little business synergy between the Cranbrook Agreement in comparison to the Opal Agreement”. This was largely due to what it described as the “ample points of difference between the instruments such that greater business synergy arises from the application of the Opal Agreement to the transferring employees”. I accepted those uncontested submissions.

  2. This factor weighed in favour of granting the Applications.

The public interest – s 318(3)(g)

  1. I was satisfied that making the orders sought by Opal HealthCare would be in the public interest. Making such orders would be consistent with the objects of Part 2-8 of the Act (s 309), in that they would provide an appropriate balance between the protection of employees’ terms and conditions of employment under enterprise agreements and the interests of Opal HealthCare in running its enterprise efficiently.

  1. This weighed in favour of granting the Applications.

Conclusion

  1. Having regard to the matters set out above, I was satisfied that it was appropriate in the circumstances to exercise my discretion to make the orders which Opal HealthCare sought.


COMMISSIONER


[1] PR784856, PR784858, PR784859 and PR784860

[2] Bloomfield Collieries Pty Limited [2022] FWC 1696 at [20]-[21]

Printed by authority of the Commonwealth Government Printer

<PR784893>

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