Goulburn Valley Health T/A Goulburn Valley Health, Gv Health
[2024] FWC 1947
•24 JULY 2024
| [2024] FWC 1947 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
Goulburn Valley Health T/A Goulburn Valley Health, Gv Health
(AG2024/1958)
| Health and welfare services | |
| COMMISSIONER ALLISON | MELBOURNE, 24 JULY 2024 |
Application for orders relating to a transferable instrument
Euroa Health Inc (Euroa Health) is a not-for-profit incorporated association which operates health and residential care services for the community in the north-east of Victoria. Amongst other services, Euroa Health currently operates an acute hospital service. Goulburn Valley Health (GVH) is the main health service in the Goulburn Valley. GVH and Euroa Health have recently engaged in negotiations to transfer the acute hospital service to GVH to ensure ongoing delivery of the service in the region. The proposed plan is that on or about 12 August 2024, GVH will acquire the acute hospital service currently operated by Euroa Health. As part of the acquisition Euroa Health will transfer property and assets to GVH. GVH will also offer to employ 26 staff members (“the transferring employees”) currently employed by Euroa Health. The transferring employees include 23 nurses, 2 allied health professionals (a radiographer and a sonographer) and 1 ward clerk. The transferring employees will continue to perform the same or substantially the same work for GVH as they currently do for Euroa Health.
The transferring employees are currently engaged under the Euroa Health Inc Enterprise Agreement 2022 (Euroa Agreement). Generally, when there is a transfer of business, an enterprise agreement that covers the transferring employees will be taken to bind the new employer with regards to the transferring employees.[1] The possible transfer of the Euroa Agreement raises some concerns for GVH, as GVH is already party to a number of public sector enterprise agreements which it applies to its current workforce, and which cover similar work to that covered by the Euroa Agreement. GVH says that the negotiations for the acquisition of the acute hospital may be jeopardised if the Euroa Agreement was to continue to apply to the transferring employees.
Consequently, GVH has lodged this Application[2] seeking two orders from the Commission:
Firstly, that the Euroa Agreement will not cover GVH or any of the transferring employees who accept an offer of employment with GVH; and
Secondly, that the transferring employees who accept an offer of employment with GVH shall be covered by the appropriate public sector Agreement, namely:
·The Nurses and Midwives (Victorian Public Sector) (Single Interest Employers) Enterprise Agreement 2020- 2024 (Nurses Agreement) which would cover the nurses;[3]
·The Allied Health Professionals (Victorian Public Sector) (Single Interest Employers) Enterprise Agreement 2021 – 2026 (Allied Agreement) which would cover the two health professionals;[4] and
·The Health and Allied Services, Managers and Administrative Workers (Victorin Public Sector) (Single Interest Employers) Enterprise agreement 2021-2025 (Health Services Agreement) which would cover the ward clerk.[5]
(together Public Sector EAs)
This decision considers whether I should grant these orders under s.318 of the Act.
Is there a transfer of business?
The power to make orders under s.318 is contingent upon the Commission being satisfied that there has been, or that there is likely to be, a transfer of business for the purposes of s.311 of the Act. I am satisfied that there will be a transfer of business from Euroa Health to GVH in relation to the acute hospital services for the following reasons:
First, the employment of the transferring employees of Euroa Health will terminate, and within three months of termination, the employees will become employees of GVH (s.311(1)(a) and (b)).
Second, having regard to the information before the Commission, I consider that the work to be performed by the transferring employees for GVH will be the same or substantially the same as the work that these employees perform for Euroa Health (s.311(1)(c)).
Finally, there is a connection between the Euroa Health and GVH as described in s.311(3), because GVH is acquiring property and assets from Euroa Health that relate to, or will be used in connection with, the transferring work.
Matters that the Commission must take into account
In deciding whether to make an order under s.318(1), the Commission must take into account the matters in s.318(3), which I now do.
The views of GVH– s.318(3)(a)(i)
The view of GVH, the new employer of the transferring employees, is that the application should be granted. GVH wishes the Public Sector EAs to apply to the transferring employees because it would standardise the conditions of employment between the transferring employees and its current staff who perform similar work at other GVH campuses or who may be deployed to the acute hospital at the Euroa Health site. GVH submits that having the transferring employees covered by the Public Sector EAs will ensure employees performing the same work are entitled to the same conditions, which will assist in fostering a single organisational culture. In addition, GVH contends having all employees covered by the Public Sector EAs will reduce the complexity of administering different wages and conditions for employees performing the same work.
The views of Employees – s.318(3)(a)(ii)
The Application and accompanying material were served on the transferring employees and their unions on 7 June 2024. The transferring employees and their unions were invited to raise any concerns regarding the Application with my Chambers and to attend a hearing on 19 June 2024.
The following employees and unions attended the hearing on 19 June 2024:
Ms Lynne Lawton, a ward clerk affected by the proposed orders and member of the Health Services Union (HSU);
The HSU representing Ms Lawton;
The Australian Nursing and Midwifery Federation (ANMF) on behalf of numerous members.
Concerns raised by the HSU and the ANMF were discussed in conference on 19 June 2024 and further discussions occurred between the parties after the conference.
On 1 July 2024 the HSU, on behalf of its member Ms Lawton, confirmed that all matters had been resolved. On 12 July 2024 the HSU confirmed that subject to an undertaking provided by GVH, which is discussed below and attached to this decision, the HSU supported the application.
On 12 July 2024 the ANMF confirmed it did not press any objection to the application, and that subject to the GVH Undertaking, the ANMF supported the application.
The views of the GVH, the transferring employees who would affected by the proposed orders, and the relevant unions, weigh in favour of granting the orders.
Whether any employees would be disadvantaged by the order – s.318(3)(b)
Conditions Other than Wages
GVH provided a detailed comparison on key conditions under the Euroa Agreement and the Public Sector EAs. These documents were also provided to the HSU and the ANMF for review.
On the evidence before the Commission the conditions under the Public Sector EAs are generally better than the equivalent conditions under the Euroa Agreement and there are a range of additional conditions. These more beneficial or additional conditions include, but are not limited to:
Higher shift allowances for nurses
Nurses to patient ratios
Higher meal allowance
An additional weeks’ leave for the ward clerk
Telephone recall allowance
Greater study leave entitlements for nurses and the ward clerk
Access to defence reserve leave make-up pay
Increased jury service make-up pay
More beneficial parental leave provisions
The ANMF raised a concern regarding the reduction in personal leave by 7 hours and 36 minutes for transferring employees within more than five years’ service. Clauses 42.2(a)(iii) and (b) of the Euroa Agreement relevantly provide an increased accumulation rate for employees with five or more years’ service. To address this concern GVH has provided an undertaking that GVH will recognise personal leave as accruing at the rate applicable under cl 42.2(a)(iii) and (b) of the Euroa Agreement for transferring employees who have 5 or more years’ service. The ANMF have accepted the undertaking as addressing this issue.
While there may be some individual conditions under the Euroa Agreement that are more beneficial than the Public Sector EAs, in general, the Public Sector EAs provide superior conditions. On the evidence before me and taking the GVH undertaking into account, I am satisfied that overall, the transferring employees will not be disadvantaged in relation to conditions of employment.[6]
Wage Rates
GVH submitted a List of Transferring Employees dated 8 July 2024 and 15 July 2024 setting out the wage rates currently received by transferring employees engaged by Euroa Health, and the wage rates the transferring employees would receive under the relevant Public Sector EAs. Both of the HSU and ANMF have confirmed their agreement with the information recorded in the List of Transferring Employees. The List of Transferring Employees shows that the majority of transferring employees (21 out of 26 employees) will receive a higher base rate under the Public Sector EAs.
There are five exceptions to this – four nurses and one sonographer.
Nurses
There are four nurses whose hourly rate under the Nurses Agreement will be between $1.12 - $2.69 below their current rates. GVH has provided an undertaking (attached to this decision) that the employees’ current rate of pay will be maintained for a period of 52 weeks from the date a transferring employee is employed by GVH (the Transfer Date).
GVH submits that the Nurses Agreement is currently the subject of bargaining. The new Nurses Agreement is very likely to include negotiated rates that will exceed the rates in the Euroa Agreement prior to the salary maintenance arrangement in the undertaking expiring. In addition, GVH points to a number of other beneficial entitlements under the Nurses Agreement that nurses will receive – such as increased shift penalty rates.
Taking into account the undertaking for salary maintenance and the additional benefits under the Public Sector EAs, I am satisfied these employees are not disadvantaged overall.
Sonographer
Euroa Health currently engages a casual sonographer on an agreed rate, significantly above the rate of pay in the Euroa Agreement. The sonographer’s hourly rate under the Allied Health Agreement would be $16.73 per hour lower than the current rate received by the sonographer.
Given that the sonographer’s current rate is an individually agreed rate, not tied to or dependent on the Euroa Agreement, this is not a matter that is relevant to my consideration of whether an employee will be disadvantaged by the orders sought in relation to the Euroa Agreement and the application of the Allied Health Agreement.
I note however, that GVH has provided an undertaking (attached to this decision) that the sonographer’s current rate will be maintained for 52 weeks from the Transfer Date.
Conclusion in relation to whether any employee would be disadvantaged by the orders
For the reasons given above in relation to conditions and wages, and taking into account the undertaking attached to this decision, I am satisfied that overall employees are not disadvantaged by the proposed orders.
This weighs in favour or granting the orders.
The nominal expiry dates of relevant agreements – s.318(3)(c)
The nominal expiry date of the Euroa Agreement is 30 June 2026. The nominal expiry date of the Public Sector EAs are:
Nurses and Midwives EA – 30 April 2024 (in negotiations)
Allied Health EA – 28 February 2026
Managers and Administrative Workers EA – 30 June 2025
Potentially the earlier expiry dates of the Public Sector EAs will mean increased benefits are negotiated for transferring employees. However, at this stage, the nominal expiry dates neither weigh for or against the making of the orders.
Whether the transfer of the Euroa Agreement would have a negative impact on GVH productivity – s.318(3)(d)
Section 318(3)(d) requires the Commission to take into account whether the transferrable instrument would have a negative impact on the productivity of the GVH’s workplace. GVH submits that if the proposed orders were not made there would be a negative impact on productivity because GVH would need to manage different pay, conditions and rostering for employees performing the same or very similar work. This would be administratively burdensome and lead to implementation and ongoing compliance costs. In addition, the organisational culture (and subsequently productivity) may be adversely affected if staff performing the same roles are receiving different condition. I accept these submissions.
This weighs in favour of granting the orders.
Whether GVH would incur significant economic disadvantage as a result of the Euroa Agreement transferring s.318(3)(e)
GVH did not make specific submissions regarding this provision, although it made general submissions about the costs associated with the implementing and ongoing compliance with the Euroa Agreement. On the evidence before me this factor neither weighs in favour or against the granting of the orders.
Whether there is business synergy between the Euroa Agreement and the Public Sector EAs – s.318(3)(f)
GVH did not make specific submissions regarding this factor. There is clearly some business synergy between the Euroa Agreement and the Public Sector EAs. However, there are also considerable differences, noting the Euroa Agreement was created to cover a not-for-profit incorporated association, as opposed to a large public health organisation. On the evidence before me this factor neither weighs in favour or against the granting of the orders.
The public interest – s.318(3)(g)
Section 318(3)(g) requires the Commission to take into account ‘the public interest’.
In Application by Engage Marine Pty Ltd[7] Commissioner Hampton (as he was at the time) found: “There is public interest in ensuring that agreed and statutorily approved arrangements are not put aside lightly and where they would cease to apply the interests of the employees concerned are safeguarded.” I am satisfied that in this instance, the interests of the transferring employees will be safeguarded. The transferring employees are not overall disadvantaged by the proposed orders, and in fact, the majority of the transferring employees will receive higher base rates and more beneficial conditions as a result of the orders. The evident support of the application by the HSU and the ANMF on behalf of their members are also important considerations.
The acute hospital service at the Euroa Health site plays an important role in providing services to the Euroa and Strathbogie community. The acquisition of the acute hospital services by GVH will help ensure the ongoing viability of this service. I accept GVH’s submission that the acquisition of the acute hospital service may be in jeopardy without the sought orders. On that basis, the public interest also supports the granting of orders to secure the ongoing operations of the acute hospital.
For the above reasons I am satisfied that the public interest supports the making of the orders.
Conclusion
Taking into account the matters is s.318(3), I have decided that it is appropriate to grant the application. I will make orders under s.318(1) that the Euroa Agreement will not cover GVH or any of the transferring employees and, that the applicable Public Sector EAs will cover the relevant transferring employees. An order will be issued separately in PR777456.
COMMISSIONER
Appearances:
A. Januszewicz for the Applicant
B. Macks for the HWU and Ms Lynne Lawton
S. Bonavia for the ANMF
Hearing details:
2024
19 June
Melbourne (Video)
Annexure A
[1] See section 313(1) Fair Work Act 2009
[2] Under section 318(1)(a) and (b) Fair Work Act
[3] AE514984.
[4] AE518146.
[5] AE515689.
[6] Application by Stratco (NSW) Pty Ltd [2010] FWA 7036 at [25]
[7] Application by Engage Marine Pty Ltd [2021] FWC 5639 at [27].
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