Edmund Rice Education Australia Flexible Schools Ltd
[2023] FWC 79
•12 JANUARY 2023
| [2023] FWC 79 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.319 - Application for an order relating to instruments covering new employer and non-transferring employees
Edmund Rice Education Australia Flexible Schools Ltd
(AG2022/5377)
| COMMISSIONER SIMPSON | BRISBANE, 12 JANUARY 2023 |
Application for an order relating to instruments covering new employer and non-transferring employees
Edmund Rice Education Australia Flexible Schools Ltd (the Applicant) has made an application pursuant to section 319 of the Fair Work Act 2009 (Cth) (the Act) for the Fair Work Commission (the Commission) to make an order in relation to a transfer of business.
Submissions & Evidence
The Applicant made submissions via the Form F40 Application, which was accompanied by the Statutory Declaration of Kym Bakaric, Director of Human Resources.
The Trustees of Edmund Rice Education Australia is currently a named employer under the Agreements. The Trustees of Edmund Rice Education Australia is the current employer of the employees at the schools covered by the Agreements set out in Schedule 3 to this Application (Old Employer). These include:
· Eastern Flexi Schools Network (St Laurence FLC, Newcastle, NSW）
· Eastern Flexi Schools Network (St Mary’s FLC, Sydney, NSW）
· Eastern Flexi Schools Network (Wollongong, NSW）
· Eastern Flexi Schools Network (Pambula Beach FLC, Pambula Beach, NSW)
· Marlene Moore Flexi Schools Network (Deception Bay, QLD)
· Marlene Moore Flexi Schools Network (Gympie, QLD)
· Marlene Moore Flexi Schools Network (Hemmant, QLD)
· Marlene Moore Flexi Schools Network (Noosa, QLD)
· Wollemi Flexi Schools Network (Albert Park, QLD)
· Wollemi Flexi Schools Network (Mount Isa, QLD)
· Wollemi Flexi Schools Network (Rockhampton, QLD）
· Wollemi Flexi Schools Network (Southport, QLD)
· Xavier Flexi Schools Network (Inala FLC, Brisbane, QLD)
· Xavier Flexi Schools Network (Ipswich, QLD)
· Xavier Flexi Schools Network (The Centre Education Program, Brisbane, QLD)
· Xavier Flexi Schools Network (Townsville, Bowen, Burdekin QLD)
· Oscar Romero Flexi Schools Network (Edmund Rice Flexi School – Elizabeth and Davoren)
· Oscar Romero Flexi Schools Network (FAME, Adelaide)
· St Edmund's College (Wahroonga, NSW)
· St Gabriel's School (Castle Hill, NSW).
Following a review of its governance arrangements the Trustees of Edmund Rice Education Australia have established a new corporate structure that includes the establishment of the Applicant (Administrative Restructure).
The transfer of the relevant assets and employees of each of the schools owned by the Trustees of Edmund Rice Education Australia to the Applicant is formalised by way of the execution of the agreement known as the “Schools Transfer Agreement: Edmund Rice Education Australia” between Trustees of Edmund Rice Education Australia and Edmund Rice Education Australia Flexible Schools Ltd dated 16 December 2022 (School Transfer Agreement).
The Applicant was registered with ASIC as a public company limited by guarantee in June 2022 and will by virtue of the School Transfer Agreement and s.311 of the Act become the employing entities of the employees employed at the schools covered by the Agreement on and from 1 January 2023 (the Transfer Date).
s.311 Matters
The Applicant submitted that by virtue of employees accepting employment with the Applicant, they will terminate their employment with the Old Employer on 31 December 2022 and commence employment with the Applicant on 1 January 2023 performing the work that is the same, or substantially the same as they performed with the Old Employer.
The Applicant submitted that there will be a connection between the Old Employer and the Applicant; the Applicant will own or have the beneficial use of some of the assets that are used in connection to the work performed.
The Applicant does not intend for the Administrative Restructure to impact on the terms and conditions of transferring employees.
The Applicant does not intend for the Administrative Restructure to impact on the minimum terms and conditions of employment for non-transferring employees.
It was submitted that a non-transferring employee is an employee who commences on or after the Transfer Date whose employment would be covered by the Educational Services (Schools) General Staff Award or the Educational Services (Teachers) Award (Non-Transferring Employee).
The Agreements that covered Trustees of Edmund Rice Education Australia, being the old employer within the meaning of s.311(1) of the Act, will cover the Applicant in respect of the employment of a transferring employee formerly employed at the Trustees of Edmund Rice Education Australia on and from the Transfer Date.
It was submitted that absent an order under s.319 of the Act:
(a)the Enterprise Agreements that covered the Applicant in respect of a transferring employee will not cover a Non-Transferring employee who is performing work that is the same, or substantially the same as a transferring employee employed by the Applicant;
(b)a Non-Transferring employee would be covered by the Educational Services (Schools) General Staff Award or the Educational Services (Teachers) Award in respect of his or her employment with the Applicant at the same school as a transferring employee who is covered by any of the relevant Agreements.
The Applicant makes this Application in an attempt to ensure that from the Transfer Date:
(a)the Applicant will remain covered by the Enterprise Agreements at the relevant schools, in respect of transferring employees and Non-Transferring employees to ensure a fair, stable, consistent and certain platform of minimum rates of pay and other terms and conditions of employment; and
(b)the Administrative Restructure does not cause Non-Transferring employees to be on different and potentially less advantageous rates of pay and other conditions than transferring employees who perform the same, or substantially the same work at the relevant schools.
Employees Affected
The Applicant submitted that the Application will not directly impact transferring employees.
It was also submitted that the Application will directly impact on the minimum rate of pay, and terms and conditions of employment of a Non-Transferring employee. As at the date of the Application, the Applicant does not employ any Non-Transferring employees but the Applicant will do so on or after the Transfer Date.
S.319(3) Matters
The Applicant submitted that the Commission can take notice and anticipate that a Non-Transferring employee would likely prefer the Application be granted, and the Orders made by the Commission.
It was submitted that the relevant Enterprise Agreements have been reviewed and approved by the Commission in accordance with the Act. The Enterprise Agreements (on an overall basis) provide rates of pay and terms and conditions of employment that will not disadvantage a Non-Transferring employee by comparison to the relevant Award.
The Applicant submitted that the Orders, if made, would have no negative impact on productivity in the respective schools, as the Orders would in effect preserve the current employment arrangements in the schools for all transferring and Non-Transferring employees.
Further, the Applicant submitted that the Orders, if made, would not cause the Applicant to incur any economic disadvantage as the Orders would in effect preserve the current employment arrangements in the schools for all transferring and Non-Transferring employees. It is likely that if the Orders were not made, the Applicant would incur additional costs and require additional resources to administer different industrial arrangements at the schools: i.e. the transferring employees would be covered by the Enterprise Agreement, and Non-Transferring employees would be covered by the Awards. The Applicant has not quantified those additional anticipated costs or resources at the time of the Application.
For the above grounds and reasons, the Applicant submitted there is a clear and compelling business synergy between the Applicant and the transferring Agreements. The Trustees of Edmund Rice Education Australia (i.e the old employer) and the transferring employees are not covered by the Awards. The Applicant and the transferring employees will not be covered by the Awards. While the Awards are designed for employers and employees in the education sector, there is no obvious business synergy between the Enterprise Agreement and the Awards so as to compel a conclusion to prefer Non-Transferring employees to be covered by the Awards.
The Public Interest
The Applicant submitted that there is a public interest in an employer group in an appropriate situation acting to preserve the sanctity and certainty of an industrial bargain with employees, which has been committed to writing and approved by the Commission in accordance with the Act. The Applicant submitted that to the extent the Administrative Restructure being undertaken by the Trustees of Edmund Rice Education Australia will trigger the transfer of business provisions in the Act, the Act ought to facilitate a smooth restructure which will preserve and not disturb the minimum terms and conditions of employment for both transferring and Non-Transferring employees.
Conclusion
I have taken into account the material provided by the Applicant in support of its application, the matters set out in s.319(3) of the Act and that the IEU do not oppose the making of the order. I am satisfied the materials provided by the Applicant, when considered against the matters set out in s.319(3) of the Act, support the making of the order.
An order to this effect is issued in conjunction with this decision.
COMMISSIONER
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