Federal Express (Australia) Pty Ltd and Federal Express Corporation

[2013] FWC 6022

[2013] FWC 6022

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.185 - Application for approval of a single-enterprise agreement

Federal Express (Australia) Pty Ltd and Federal Express Corporation
(AG2013/7562)

Federal Express (Australia) Pty Limited and Federal Express Corporation National Enterprise Agreement 2013

COMMISSIONER CARGILL SYDNEY, 27 AUGUST 2013

Application for approval of the Federal Express (Australia) Pty Limited and Federal Express Corporation National Enterprise Agreement 2013.

[1] This decision concerns an application made under section 185 of the Fair Work Act 2009 (the Act) for the approval of a single enterprise agreement. The application has been made by Federal Express (Australia) Pty Limited and Federal Express Corporation (collectively referred to as FedEx or the companies). The title of the agreement is the Federal Express (Australia) Pty Limited and Federal Express Corporation National Enterprise Agreement 2013 (the Agreement).

[2] The application is opposed by both the Transport Workers’ Union of Australia (TWU) and the Australian Municipal, Administrative, Clerical and Services Union (ASU). Both of these organisations were bargaining representatives for the Agreement. The application, Form F16, also identifies five named individuals as bargaining representatives for the Agreement.

[3] The matter was listed for a Directions hearing by recorded telephone link on 31 July 2013. At that hearing FedEx was represented by its bargaining representative Mr P Brown. The TWU was represented by Ms T Walton and the ASU by Mr J Nucifora. It was agreed that the matter would be dealt with “on the papers” and a timetable was put in place for the purpose of filing and exchange of written submissions. Mr Brown provided an undertaking that the individual bargaining representatives would be served with copies of the written material.

[4] The main thrust of the objections from the unions relates to whether the Agreement passes the Better Off Overall Test (the BOOT). However, the ASU also raises issues about the bargaining process. Neither organisation has any concern with the conduct of the ballot of the employees or its outcome. In this regard it should be noted that the statutory declaration in support of the application, Form F17, discloses that the Agreement will cover 611 employees. It also discloses that 528 of those employees cast a valid vote in the ballot and that 472 voted to approve the Agreement.

[5] I understand that this is the fourth enterprise agreement between FedEx and its employees. The existing agreement, which will be replaced by the Agreement if it is approved, is the FedEx National Enterprise Agreement 2010 (the 2010 Agreement). It was approved on 21 July 2010 and has a nominal expiry date of 4 August 2013.

SUBMISSIONS OF THE ASU

[6] The ASU’s concern with the bargaining process relates to the fact that FedEx conducted bargaining meetings with the, then unknown to the union, individual bargaining representatives which were separate to the meetings it had with the TWU and itself. It submits that this is a serious flaw in the process and questions whether genuine agreement is possible in the absence of all representatives sharing information and meeting together.

[7] The ASU rejects any contention that just because a specific clause or clauses in the 2010 agreement in particular, had been found to pass the BOOT that it or they should automatically meet the test now. The ASU notes that a number of “roll over” agreements have been analysed with fresh eyes and have been found not to pass the BOOT. Examples are provided concerning The Smith Family Community Programs Enterprise Agreement 2013 and the Finance Sector Union Staff Collective Agreement 2013.

[8] The ASU has compared the Agreement with the Clerks - Private Sector Award 2013 (the Clerks Award) and contends that there are five areas of deficiency which should lead to the conclusion that the Agreement does not pass the BOOT.

[9] The first concerns part-time employees which are dealt with in clause 5 of the Agreement and clause 11 of the Clerks Award. The union submits that the Agreement does not provide that, upon engagement, employees are to receive written agreement on a regular pattern of hours. Neither does it provide for a week’s notice for a change in hours nor a minimum engagement of three hours. The ASU also submits that the Agreement provides that no paid overtime will be received until an employee has worked 38 hours in a week. The union submits that there is no adequate compensation in the Agreement for these inferior provisions which are also contrary to award entitlements to family friendly working arrangements.

[10] The second area of deficiency concerns the span of hours. Clause 9 of the Agreement provides a span of hours of 5am to 7pm whereas clause 25 of the Clerks Award sets a span of 7am to 7pm. The union contends that there is no adequate compensation for this inferior provision.

[11] The third concern relates to the absence of any job descriptors and competencies in the Agreement as are contained in Schedule B of the Clerks Award. The ASU notes that the Form F17 attaches a table which matches FedEx Job Titles with those in Schedule B. However, the union submits that the lack of job descriptors to substantiate the translations prevents a proper informed decision being made on this point.

[12] The fourth area of concern is the absence of two 10 minute rest breaks for full time employees as provided for in clause 26 of the Clerks Award. The ASU submits this not just an award entitlement but a workplace health and safety issue which cannot be compensated for by the payment of money.

[13] The fifth area of deficiency is the absence of any provision for a job search entitlement, living away from home allowance, district allowances or accident make up pay as set out in the Clerks Award.

[14] The ASU submits that its concerns are sufficiently critical for the Agreement not to be approved in its present form. The ASU also support the TWU’s submissions.

SUBMISSIONS OF THE TWU

[15] The TWU notes that it did not reach agreement with FedEx during the bargaining process and does not agree with the terms and conditions of the Agreement as they are inferior to those under the Road Transport and Distribution Award 2010 (the Road Transport Award). The union submits that the Agreement does not pass the BOOT and that clause 17 of the Agreement contravenes section 55 of the Act. As a consequence the application should be dismissed.

[16] The TWU refers to the legislative provisions which relate to applications for the approval of enterprise agreements, particularly sections 186(2)(c) and (d), 189, 190 and 193. The union also refers to the decision of the Federal Court of Australia in Construction, Forestry, Mining and Energy Union v Deputy President Hamberger [2011] FCA 719 @ 91 and comments therein concerning the purpose of the BOOT. In addition, the TWU points to a decision concerning Canberra Building Services Pty Ltd Enterprise Agreement 2010. Although the citation provided was to the decision in [2010] FWA 1752 that decision relates to the requirements of section 181 of the Act. It would appear that the relevant decision is the one in [2011] FWA 318 which deals at length with the BOOT.

[17] The TWU notes that the BOOT is a global test requiring a balanced consideration of advantages and disadvantages to employees. It refers to the Full Bench decisions in Re:Armacell Australia Enterprise Agreement 2010[2010] FWAFB 9985 (Armacell) and Re: Solar Systems Pty Ltd Enterprise Agreement 2011 [2012] FWFB 6397 (Solar Systems) as setting out the required approach to applying the BOOT. The union submits that the proper approach is to identify the more beneficial entitlements under the Agreement, balance those against the identified disadvantages and reach an overall view.

[18] The TWU identifies seven aspects of the Agreement which are less beneficial than the Road Transport Award. The first is the absence of classification descriptors. The consequence of this is that employees are unable to identify their levels or grades which are therefore at the total discretion of the employer. The second aspect concerns the ordinary hours of work. Clause 9 of the Agreement widens the span of hours under the Award, 5.30am to 6.30pm, by half an hour at each end to 5am to 7pm. The union submits that this reduces the ability of employees to receive overtime penalty rates which has a negative impact on the whole work force.

[19] The third aspect identified by the TWU concerns employees’ rostered hours. Clause 12 of the Agreement permits FedEx to unilaterally change roster hours which is a significant detraction from the Road Transport Award. The union refers to the provisions of clause 22.3 of the Award which permit the spread of hours to be altered by agreement and submits that the Award clearly prohibits an employer being able to direct employees to work each day of the week. The union also submits that the other disadvantage to employees is their loss of penalty rates for working irregular shifts under clause 24.10 of the Road Transport Award.

[20] The fourth aspect of concern identified by the TWU relates to the absence of any provision for a paid break in clause 13 of the Agreement. The TWU submits that as well as being a disadvantage under the Agreement the absence of a paid break is a “blatant deprivation of an entitlement endowed by the law”.

[21] The fifth aspect concerns unpaid breaks. The unions submits that the Agreement restricts the taking of the unpaid meal break to no earlier than five hours after the commencement of work whereas the Road Transport Award prescribes that the break be taken no earlier than three and a half hours and no later than five and a half hours after commencing work.

[22] The sixth concern is the removal of the award entitlement to a paid day job search entitlement. The seventh concern is the absence of an entitlement for a substituted day off for working on public holidays as provided in clauses 28 and 32 of the Road Transport Award.

[23] The TWU submits that employees who are subject to these identified disadvantages would not be better off overall than if the Road Transport Award applied. It refers to the list of terms and conditions of the Agreement identified by FedEx in its Form F17 as being more beneficial. The TWU contests the truth and accuracy of that claim and submits that the majority of the items listed are either existing entitlements under the National Employment Standards (NES) or are no better than the equivalent provisions of the Road Transport Award.

[24] The TWU provides an analysis of the list provided by FedEx. This analysis is attached to the written submissions as Attachment TWU1. The union submits that, in truth, there are only eight items in the Agreement which are more beneficial than the Road Transport Award. Those items are: rates of pay; the provision of equivalent wages to juniors, trainees and supported wage employees; higher superannuation contributions; higher leave loading; long service leave; jury service leave; paid parental leave; and the FedEx day.

[25] The TWU submits that some of these more beneficial conditions could be used to offset some of the identified disadvantages such as a wider span of hours and removal of paid breaks. However the non-financial matters such as the absence of job descriptors, changes to rosters and the absence of an ability to substitute public holidays could not be offset. Overall the Agreement does not pass the BOOT. The union notes that nothing has been put by FedEx to enliven section 189.

[26] The union submits that clause 17 of the Agreement contravenes section 55 of the Act. It submits that, in effect, the clause allows FedEx to dismiss without notice any employee it considers has engaged in misconduct or has breached FedEx’s policies which can be changed unilaterally by the employer and which do not form part of the Agreement.

[27] The TWU submits that this seriously undermines employees’ entitlements under the NES. It notes the requirements of sections 117 and 123 and the definition of serious misconduct in the Fair Work Regulations 2009 (the Regulations). The union submits that the expansion of the employer’s right to dismiss without notice contravenes section 55 of the Actand consequently cannot be approved.

SUBMISSIONS ON BEHALF OF FEDEX

[28] FedEx submits that all of the procedural requirements for approval of the Agreement have been met. It also submits that the Agreement passes the BOOT. FedEx relies upon the material contained in its Form F17 and annexures thereto as well as its written submissions.

[29] Annexure FedEx 3 to the Form F17 identifies what the companies say are the more beneficial terms and conditions in the Agreement compared with the Awards. Annexure FedEx 4 identifies the terms and conditions which are said to be less beneficial. In its written submissions FedEx expands upon 18 key benefits.

[30] The first is that clause 7 and Annexure A to the Agreement set out minimum base hourly rates of pay which are higher than the minimum rates in the relevant awards. It should be noted that, in addition to the Clerks Award and the Road Transport Award, the Airline Operations Grounds Staff Award 2010 (the Airline Award) also covers employees who will be covered by the Agreement if it is approved. The minimum rates in the Agreement apply to all employees regardless of whether they are juniors or trainees. FedEx submits that actual rates of pay are generally higher than the minimum rates set out in the Agreement.

[31] The second benefit is the guaranteed pay increases during the life of the Agreement of 2% in October 2013, 2% in October 2014 and 2% in October 2015. Clause 7.3 of the Agreement provides employees with access to individual performance based increases. FedEx allocates 2% of the total annual base rates of pay for agreement covered employees into a pool for this purpose. The actual amount received by an employee depends upon their performance.

[32] The third benefit identified by FedEx is an additional superannuation contribution. At the commencement of the Agreement the superannuation contribution will be 10%. The Agreement also provides that, as the statutory contribution rate increases, FedEx will pay an additional 1% of ordinary time earnings.

[33] The fourth benefit is the annual leave loading in the Agreement of 26.32% compared with the 17.5% loading in each of the awards. The fifth benefit is said to be the ability to cash out annual leave. The sixth benefit is the provision in clause 14.2 of an additional week’s leave for employees who are rostered to and work on 12 or more weekend days in a calendar year.

[34] The seventh benefit is contained in clause 14.3 of the Agreement which provides for an additional day’s leave, described as a “floating FedEx leave day”. This is available where the particular State or Territory in which the person is employed does not gazette at least 10 weekdays as public holidays. It is also available to employees who work on 12 or more weekend days in a calendar year but who are not rostered to work on any gazetted public holiday in that year.

[35] The eighth benefit is the expanded access to paid personal leave for purposes such as study, household and emergency services. The ninth benefit concerns long service leave. Clause 14.6 of the Agreement provides that such leave will accrue when an employee is on both paid and unpaid leave provided that the leave has been approved.

[36] The tenth benefit is the provision of access to an additional paid day of compassionate leave on each permissible occasion. The eleventh benefit is the absence of any limit on the period of paid jury service leave and the addition of access to unpaid Defence Reserve Service Leave.

[37] The twelfth benefit identified by FedEx is the provision of twelve weeks’ paid parental leave for eligible employees. The thirteenth benefit is enhanced redundancy benefits. Clause 18 of the Agreement provides for a scale of benefits up to 19.2 weeks for employees under 45 who have six years or more service. The benefit for those with the same service who are 45 or more is 24 weeks.

[38] The fourteenth benefit is the guaranteed increase to a range of allowances during the life of the Agreement as set out in Annexure B to the Agreement. The fifteenth benefit is access to salary packaging arrangements.

[39] The sixteenth benefit concerns casual employees. Clause 5 provides that such employees shall have a minimum period of engagement of four hours compared with a minimum of three hours in clause 12.4 of the Clerks Award. In addition, clause 5 gives casual employees the right to request to be engaged on a full-time or part-time basis. This provision does not exist in either the Clerks Award or the Airline Award.

[40] The seventeenth benefit is said to be the provision in clause 14.4 of the Agreement of three single occasions on which employees will not be required to provide medical certificates to support their absence from work. The final benefit is the provision of penalty rates in various circumstances.

[41] FedEx also makes submissions in response to those made by the unions. It rejects the ASU’s submissions concerning the part-time employee provisions. In particular it refers to the definition of part-time employees in clause 5 and the terms of clause 12 both of which refer to “hours as agreed with your manager”. It also refers to the requirement of clause 12 that FedEx will have regard to the personal circumstances of employees when setting and changing rosters as well as the ability of employees to discuss personal restrictions in relation to rosters.

[42] FedEx submits that the ASU is incorrect in contending that part-time employees do not receive overtime until they have worked 38 hours a week. Clause 9.2 provides that overtime rates are to be paid when a part-time employee works in excess of their rostered hours on any weekday.

[43] FedEx rejects the ASU’s submission that the wider span of hours and lack of rest breaks are such that the Agreement does not pass the BOOT. It submits that the benefits which it has identified, both monetary and non-monetary, offset these and other disadvantages.

[44] FedEx notes that it has provided a table, Annexure FedEx 2 to its Form F17, which identifies how the Agreement classifications relate to those in the awards.

[45] FedEx rejects the TWU’s submission that clause 17 of the Agreement contravenes section 55 of the Act, or that it breaches the NES or the Regulations. It submits that there is no legislative prohibition on an employer prescribing what it believes could constitute misconduct. It also submits that what misconduct is may vary from industry to industry and that each situation needs to be considered separately.

[46] FedEx rejects the TWU’s submission that the use of job titles in the Agreement rather than descriptors does not allow employees to identify their grade or classification. FedEx notes the TWU submission concerning the expanded span of hours in clause 9.1 of the Agreement. It refers to clause 22.7 of the Road Transport Award which permits the alteration of the spread of ordinary hours by agreement and notes the requirement of clause 12 of the Agreement referred in paragraph 41 above.

[47] FedEx submits that eligible employees are provided with a paid break allowance in Annexure B to the Agreement and that employees are given access to unpaid breaks in accordance with the Agreement. FedEx submits that the TWU is incorrect in its contention that the additional compassionate leave provided under the Agreement is deducted from an employee’s accrued personal leave.

[48] FedEx denies that the contents of Annexure FedEx 3 to its Form F17 are not truthful or are inaccurate. The companies do not agree with the TWU’s analysis of the terms and conditions of the Agreement compared with the Road Transport Award.

[49] FedEx submits that the Agreement passes the BOOT. It refers to the Full Bench Armacell and Solar Systems decisions and submits that the BOOT is not to be approached as a line by line analysis but rather as an overall assessment. FedEx notes that, if all of the legislative requirements are met, an agreement must be approved: National Tertiary Education Industry Union v University of New South Wales[2011] FWAFB 5163 @ 17 and 46 (NTEIU).

[50] FedEx submits that the factual information in the Forms F16, F17 and its written submissions is sufficient to enable the Agreement to be approved.

CONCLUSIONS

[51] Section 186 of the Act provides that the Fair Work Commission (FWC) must approve an enterprise agreement if the requirements of the section and section 187 are met. Section 186(2) relevantly provides that FWC must be satisfied that the agreement has been genuinely agreed to by the employees covered by it, that its terms do not contravene section 55 and that the agreement passes the BOOT. I shall deal with each of these issues in turn.

[52] The ASU has raised concerns about the bargaining process and questions whether there could be genuine agreement in circumstances which did not involve all of the bargaining representatives meeting together and sharing information. Section 187(2) requires FWC to be satisfied that approving an agreement would not be inconsistent with or undermine good faith bargaining, however, this requirement only applies to a situation where a scope order is in place. There is no such order in relation to the Agreement.

[53] The issue of genuine agreement is dealt with in section 188, however, it concerns the question of when employees have genuinely agreed to an agreement. It requires FWC to be satisfied that the employer has complied with various procedural steps, that the vote of the employees has been conducted in accordance with, in this case, section 182(1) and that there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees.

[54] There is nothing before me to suggest that there has been any failing in relation to the procedural requirements of the legislation. During the Directions hearing the unions confirmed that there was no issue with the conduct or outcome of the employee vote. I do not consider that there are any other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees. I am satisfied that the Agreement has been genuinely agreed to by the employees covered by it.

[55] The next issue to be considered is whether any of the terms of the Agreement contravene section 55 of the Act. Section 55 concerns the interaction between the NES and modern awards and enterprise agreements. It provides that such instruments must not exclude any provision of the NES. Subsection (4) permits the instruments to include terms that are ancillary or incidental to the operation of an entitlement under the NES and terms that supplement the NES provided that the effect of those terms is not detrimental to an employee when compared with the NES. Subsection (5) permits an enterprise agreement to include terms which have the same or substantially similar effect to provisions of the NES. Subsection (7) provides that, to the extent that a term of an award or agreement is permitted by subsections (4) or (5), the term does not contravene the section.

[56] In this case the term of the Agreement which is said to contravene section 55 is clause 17. The clause consists of two paragraphs. It is the first paragraph which is relevant and it reads as follows:

“In circumstances of misconduct or any other breach of FedEx policies, FedEx may terminate your employment without notice or payment in lieu.”

[57] The relevant provisions of the NES are contained in sections 117 and 123 of the Act. Section 117 provides that an employer must not terminate an employee’s employment unless it has provided written notice or payment in lieu of that notice. Section 123 permits termination without notice or payment in lieu in relation to certain types of employees. Subsection (1)(b) identifies one such type as employees whose employment is terminated because of serious misconduct. Serious misconduct is defined in section 12 as having the meaning prescribed by the Regulations. Regulation 1.07 provides that serious misconduct has its original meaning and sets out examples of what the phrase includes.

[58] I agree that the categories of matters or behaviours which could constitute misconduct are not closed and that minds might, and do, differ over what should be or should not be included. Many unfair dismissal claims are fought over this very issue. However, the concern with clause 17 of the Agreement is that it permits FedEx to terminate without notice or payment in lieu in circumstances of “misconduct” not “serious misconduct”. It also permits such termination for “any other breach of FedEx policies” (my emphasis). This indicates that such “other breach” is in a separate category to misconduct.

[59] I consider that in both regards the effect of clause 17 is detrimental to employees when compared with the provisions of sections 117 and 123 of the Act. As a consequence it contravenes section 55 and fails to meet the requirements of section 186(c). I consider that this concern can be met by an undertaking that restricts termination without notice or payment in lieu to instances of serious misconduct.

[60] The next issue is whether the Agreement passes the BOOT. The nature of the BOOT is set out in section 193 of the Act. That section relevantly provides that:

(1) An enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if FWC is satisfied, as at the test time, that each award covered employee, and each prospective award covered employee, for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee...

...

(6) The test time is the time the application for approval of the agreement by FWC was made under section 185.

(7) For the purposes of determining whether an enterprise agreement passes the better off overall test, if a class of employees to which a particular employee belongs would be better off if the agreement applied to that class than if the relevant modern award applied to that class, FWC is entitled to assume, in the absence of evidence to the contrary, that the employee would be better off overall if the agreement applied to the employee.”

[61] I agree with the submissions of the ASU that, just because an agreement has previously passed the BOOT, does not mean that an instrument with the same or similar provisions will automatically be approved. Clearly the Act requires that the BOOT must be considered at the relevant test time on each occasion. However, I do consider that it is rather disingenuous of the TWU to describe clause 13 of the Agreement which is in identical terms to the relevant clause in the 2010 agreement which was supported by both unions, as a “blatant deprivation of an entitlement endowed by law”.

[62] There is no disagreement between FedEx and the unions as to the way in which the BOOT is to be applied. As the Armacell and NTEIU Full Benches determined, it requires the identification of terms in the Agreement which are more beneficial for an employee when compared with those in the relevant award, the terms which are less beneficial and an overall assessment of whether the employee would be better off under the Agreement.

[63] There are several terms in the Agreement which are clearly more beneficial to employees. With one exception the minimum rates of pay in the Agreement are higher than those for the equivalent position in the comparable award. The differences are not evenly spread but range from .26 cents per hour higher to more than double the award hourly rate. The rate for the position of Handler of $18 per hour is higher than for the equivalent level in the Road Transport Award but is .27 cents per hour lower than for a second year employee and .84 cents per hour lower than for a third year employee under the equivalent level in the Clerks Award. A suitable undertaking will be required to address this concern.

[64] The minimum rates in the Agreement apply to all employees regardless of whether they are juniors or trainees. That is a benefit to those particular employees. The statistical information provided in the Form F17 indicates that there are nine employees under the age of 21. There is no information about the number of trainees, if any.

[65] FedEx submits that the actual rates paid to employees are generally higher than the minimum rates set out in the Agreement, however, the BOOT is concerned with the terms of the Agreement not what might be paid over and above those rates.

[66] The Agreement provides for three guaranteed increases to the actual rates of pay of all employees during the term of the Agreement. Those increases are 2% in each of October 2013, October 2014 and October 2015. I note the TWU’s submission that the increase awarded in the Annual Wage Review 2012-13 was 2.6%. Nevertheless the increases in the Agreement are certain and I consider that they deliver a benefit to employees.

[67] The guaranteed increases to the meal, first aid, dangerous goods, flexibility and on-road allowances as provided for in Annexure B to the Agreement are more beneficial to relevant employees than the awards.

[68] I have also noted that the Agreement provides employees with access to performance based pay and that FedEx is obliged to set aside a certain amount for that purpose. I accept that this is beneficial to employees in an overall sense. However access to the pay depends upon performance so there is no guarantee that any particular individual or class of employees will receive an actual benefit from it.

[69] The additional 1% superannuation contribution is clearly beneficial to employees. The annual leave loading of 26.32% compared with the 17.5% loading in the awards is beneficial to all except casual employees.

[70] The redundancy entitlements in clause 18 of the Agreement are significantly higher than those which are contained in the awards which only call up the NES provisions. The benefit ranges from an additional .8 of a week’s pay at the lowest end of the scale to an additional 8.2 weeks’ pay for employees with six years or more service. For employees who are 45 and over the benefit ranges from an additional 2 weeks’ pay at the lowest end of the scale to an additional 13 weeks’ pay for those with six or more years service. The entitlements in the Agreement do not increase beyond six years service so the differential is less for those with seven years or more service, nevertheless, the Agreement entitlements are more beneficial than those in the awards.

[71] I note the comment in Attachment TWU1 to the union’s written submissions that the Agreement would not prevent FedEx reducing the hours of a part-time employee immediately prior to such a person being made redundant thereby reducing their potential redundancy benefit. If such action was taken there would be recourse to the grievance procedure in Annexure C to the Agreement which includes arbitration by FWC.

[72] The provision of 12 weeks’ paid parental leave for eligible employees in clause 14.8 of the Agreement is more beneficial than the awards none of which include paid parental leave.

[73] The accrual under the Agreement of long service leave during periods of approved unpaid leave is more beneficial to employees. A further benefit derives from the provision in clause 14.5 of the Agreement of an additional day of compassionate leave on each relevant occasion when compared with the NES entitlement. Contrary to the submission of the TWU the Agreement does not provide that this additional day is deducted from an employee’s accrued personal leave entitlement.

[74] The provision of an unlimited period of paid jury service leave is a benefit to employees. I also consider the fact that employees are able to utilise their paid personal leave entitlements to deal with a wider range of circumstances such as study, emergency services and household leave is more beneficial to them. It is true that the Agreement does not confer any additional quantum of leave in this regard but the ability to be paid for such absences is an advantage to employees.

[75] The provision of unpaid Defence Reserve Service leave may be of benefit to some employees though of no interest to others.

[76] The “floating FedEx day” of leave for eligible employees is a benefit to those employees as is the access to an additional week’s annual leave for those employees who are rostered to and work on 12 or more weekend days in a calendar year.

[77] The four hour minimum engagement period for casuals and their ability to request to convert to full or part-time employment is a benefit to the casual employees.

[78] Assuming that the ability to cash out paid annual leave is considered to be a benefit, which is at times the subject of much debate, employees at FedEx will only derive such a benefit from the Agreement. The NES permits such a practice only where a relevant term is included in an award or enterprise agreement or in certain other circumstances not presently relevant. None of the awards which apply to employees who will be covered by the Agreement include such a term.

[79] The Agreement provides employees with the ability to access salary packaging arrangements. This would no doubt be of benefit to some employees but not to others.

[80] The Agreement also contains some provisions which are less beneficial to employees than the relevant awards. As identified by the ASU the Agreement does not specify that new part-time employees are to be provided with a written agreement setting a regular pattern of hours contrary to clause 11.3 of the Clerks Award. The Agreement does not provide for a minimum of three consecutive hours for part-timers as clause 11.5 of the award requires.

[81] Although the Agreement does not require a week’s notice of a unilateral change to an employee’s rostered hours in precise terms, I consider that clause 9.6 adequately deals with the situation. It provides that where there is to be a change to an employee’s rostered hours of more than one hour and the employee is given less than 7 days’ notice, then a penalty rate of 50% for the first two hours and 100% thereafter applies.

[82] I do not agree with the ASU that part-time employees under the Agreement only receive overtime after working 38 hours a week. Clause 9.2 provides for overtime penalty rates to be paid for any hours worked in excess of an employee’s rostered hours.

[83] The span of hours in the Agreement is 5am to 7pm. This compares with a span of 7am to 6pm under the Airlines Award, 7am to 7pm under the Clerks Award and 5.30am to 6.30pm under the Road Transport Award. I consider this provision in the Agreement to be less beneficial than the corresponding award provisions.

[84] The Agreement does not include the two 10 minute paid rest breaks which are provided for in clause 26.2 of the Clerks Award or the paid 20 minute break for shiftworkers and those working overtime as in the Road Transport Award. I note that in the Form F17 FedEx indicates that the Agreement does not cover shiftworkers and that the Agreement does not contain references to shiftworkers. I also note that Appendix B to the Agreement provides “break” allowances to be paid to employees working additional hours or outside of the span of hours.

[85] I consider that the issue of health and safety raised in relation to the absence of the paid breaks is important. However I note that clause 13 of the Agreement appears to contemplate that there may be breaks, in addition to the meal break, but that they will be unpaid.

[86] The Agreement does not contain any job search entitlement, living away from home allowance, district allowances or accident make up pay. The public holiday penalty rate in the Agreement is the same regardless of the particular holiday. This is less beneficial than the rate which applies to Good Friday and Christmas Day in clause 28.2(c) of the Road Transport Award and the rates for casual employees in clause 28.2(f) in that award. The penalty rate in the Agreement is also less than the rate in clause 31.3 of the Clerks Award. There is no ability in the Agreement for the substitution of public holidays by agreement. I consider that each of these Agreement provisions to be less beneficial to employees than the relevant award.

[87] Both unions have identified the absence of job descriptors in the Agreement as providing less beneficial conditions to employees than they would enjoy under the awards. I note that a comparison of the job classifications in Annexure A with the equivalent annexure to the 2010 agreement discloses that there are several new positions. Nevertheless, there is nothing before me to suggest that employees have experienced any difficulty in understanding their particular classifications under that agreement. I am satisfied that the absence of job descriptors does not impact on employees to their disadvantage.

[88] During the course of my consideration of the Agreement I became aware of four points of difference between the classifications in Annexure A to the Agreement and Annexure FedEx 2 which was attached to the Form F17. Those differences are: the omission of the classification of Receptionist from Annexure FedEx2; and the omission of the classifications of Customer Service Representative, Senior Customer Service Representative and Senior Customs Representative from Annexure A. I sought clarification of these differences through my Associate. An email from the companies’ legal advisors has addressed these points. The role of Receptionist is aligned with Level 1 of the Clerks Award. The classifications of Customer Service Representative, Senior Customer Service Representative and Senior Customs Representative are not covered by the Agreement.

[89] I have identified several benefits which are conferred by the Agreement and have also identified several disadvantages for employees. I am satisfied that on an overall assessment the benefits more than offset for every employee any disadvantage when compared with the relevant award. As a consequence, I am satisfied that the Agreement passes the BOOT.

[90] Subject to receiving appropriate undertakings as identified in paragraphs 59 and 63 above I will approve the Agreement. Section 190(4) of the Act requires that FWC must not accept an undertaking unless the views of the known bargaining representatives have been sought. Those views will need to be obtained before the approval occurs.

[91] The ASU and the TWU have given notice under section 183 of the Act that they want the Agreement to cover their respective organisations. I understand that a concern about the organisations being signatories to the Agreement has now been addressed.

COMMISSIONER

Appearances:

P. Brown, solicitor, as bargaining representative for Federal Express (Australia) Pty Limited and Federal Express Corporation.

T. Walton for the Transport Workers’ Union of Australia.

J. Nucifora for Australian Municipal, Administrative, Clerical and Services Union.

Hearing by telephone link details:

Sydney

2013.

July 31.

Written submissions:

Australian Municipal, Administrative, Clerical and Services Union, 7 August 2013.

Transport Workers’ Union of Australia, 8 August 2013.

Federal Express (Australia) Pty Limited and Federal Express Corporation, 14 August 2103.

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