HammondCare T/A HammondCare

[2019] FWCA 3403

[2019] FWCA 3403

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

HammondCare T/A HammondCare
(AG2018/5975)

HAMMONDCARE RESIDENTIAL CARE AND HAMMONDCARE AT HOME ENTERPRISE AGREEMENT 2018

Aged care industry
DEPUTY PRESIDENT CROSS	SYDNEY, 30 MAY 2019

Application for approval of the HammondCare Residential Care and HammondCare at Home Enterprise Agreement 2018.

[1] An application has been made by HammondCare for the approval of an enterprise agreement known as the HammondCare Residential Care and HammondCare at Home Enterprise Agreement 2018 (the ‘Agreement’). The application was made pursuant to s.185 of the Fair Work Act 2009 (the ‘Act’) on 14 October, 2018. 1 The Agreement is a single enterprise agreement.

[2] The employees whose employment is covered by the Agreement perform work that is covered by the Nurses Award 2010, the Aged Care Award 2010, and the Social, Community, Home Care and Disability Services Industry Award 2010 (the ‘SCHADS Award’).

Background

[3] The application was lodged with the Fair Work Commission (the ‘Commission’) on 24 October, 2018. The following documents were received from HammondCare: -

1. Form F16;
2. Form F17, completed by Mr. Jeff Wright; and
3. A copy of the Agreement.

[4] The Health Services Union – New South Wales Branch (the ‘HSU’), the New South Wales Nurses and Midwives’ Association (the ‘NSWNMA’) and United Voice (‘UV’) were employee organisation bargaining representatives for the Agreement. There were a further twenty-three (23) nominated employee bargaining representatives for the Agreement and the Schedule of those nominated employee bargaining representatives attached to the Form F16 is Annexure ‘A’ to this Decision.

[5] The HSU, the NSWNMA and UV all filed Form F18 declarations on 16 November, 26 November, and 4 December, 2018, respectively. The HSU, the NSWNMA and UV all supported the approval of the Agreement, but disagreed with a number of the answers provided by HammondCare in the Form F17.

[6] On 4 March, 2019, I issued Directions for the filing and service of Submissions and evidentiary materials. The parties have since complied with those Directions. In particular: -

1. The HSU filed their Submissions, including an excel document and summary sheet of proposed undertakings, on 8 March, 2019, with the NSWNMA and UV adopting the Submissions of the HSU.

2. HammondCare filed their Submissions, including draft undertakings and a number of emails and documentary material covering Form F17 questions 2.4 to 2.8, on 22 March 2019.

3. The HSU filed their Submissions in reply, which annexed a number of witness statements, on 5 April 2019.

4. HammondCare filed further Supplementary Submissions and witness statements, not pursuant to the Directions, on 12, April 2019.

[7] On 1 March, 2019, at the hearing when the Directions for the filing and service of Submissions and evidentiary materials were made, it was agreed that I should determine the application on the papers without a hearing. There has since been no suggestion that that was not the appropriate course.

Legislative framework

[8] The approval of enterprise agreements is dealt with in Division 4, Part 2-4 of the Act. Section 186(1) provides that the Commission must approve an agreement if the requirements in sections 186 and 187 are met (emphasis intended). For the purposes of this decision, the particular requirements set out in s 186(2)(d) are relevant: -

‘(2) The FWC must be satisfied that:
...

(d) the agreement passes the better off overall test.’

[9] Section 193 of the Act deals with when an enterprise agreement passes the Better Off Overall Test (the ‘BOOT’) and what is meant by that term. It is expressed as follows: -

‘193 Passing the better off overall test
When a non-greenfields agreement passes the better off overall test
(1) An enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if the 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 the FWC was made under section 185.
FWC may assume employee better off overall in certain circumstances
(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, the 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.’

[10] As Deputy President Sams observed of the BOOT in Rooty Hill RSL Club Limited [2014] FWCA 2191, at paragraphs [37] to [39]: -

‘[37] ... It must be emphasised that an assessment of the BOOT is not a ‘line by line’ analysis of one term or condition in the Agreement compared to its corresponding provision (or lack thereof) in the Award. As was said in Armacell Australia Pty Ltd & Ors [2010] FWAFB 9985 at paragraph [41]:

‘[41] The BOOT, as the name implies, requires an overall assessment to be made. This requires the identification of terms which are more beneficial for an employee, terms which are less beneficial and an overall assessment of whether an employee would be better off under the agreement. The approach adopted by the Commissioner includes an identification of terms which might, on his view of the term, be less beneficial for an employee. There is nothing on the face of the Commissioner’s decision to indicate what account if any he took of any terms which might be more beneficial for an employee. He obtained a large number of undertakings from all three employers in relation to terms which he considered undermined existing entitlements. It may be that if we applied the BOOT ourselves we might come to different conclusions to the Commissioner in relation to the number and nature of the undertakings required. To follow that course, however, would require each of the applications to be considered afresh with the necessary delay that would entail.’

[38]In National Tertiary Education Industry Union v University of New South Wales [2011] FWAFB 5163 (the ‘NTEU decision’), the Full Bench said at paragraphs [46] to [47]:

‘[46] The test, as the name implies, requires an assessment of the overall benefit to an employee employed under an enterprise agreement as compared to the relevant award. This consideration does not require an assessment of the circumstances of each individual employee but, as s.193(7) allows, “... 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 award applied to that class , FWA 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”.
[47]As His Honour was well aware the Agreement contained some provisions which may be considered inferior to the counterparts provision in the Awards and provisions which were superior. There is nothing unusual about that. What he needed to satisfy himself of was whether, weighing the Agreement provisions as a whole with those in the Awards, an employee is better off overall. This, in our opinion, is clearly what His Honour did [footnotes omitted].’

[39]In the NTEU decision, the Full Bench quoted from Lawler VP’s decision which was under appeal; See: University of New South Wales [2010] FWAA 9588. It is useful to highlight how His Honour described the task of assessing the BOOT. At para [96], His Honour said:

‘[96]It is trite to observe that awards typically contain both monetary and non-monetary terms and conditions. Obviously enough, the BOOT calls for an overall assessment. Comparing monetary terms and conditions is, at the end of the day, a matter of arithmetic. There is an obvious problem of comparing apples with oranges when it comes to including changes to non-monetary terms and conditions into the “overall” assessment that is required by the BOOT. In such circumstances the Tribunal must simply do its best and make what amounts to an impressionistic assessment, albeit by taking into account any evidence about the significance to particular classes of employees covered by the Agreement of changes to particular non-monetary terms that render them less beneficial than the equivalent non-monetary term in an award. In my view, it may also be relevant to consider the terms of any existing agreement and whether there is a relevant change of position when compared to that existing agreement.’’

Submissions

[11] As noted above, the NSWNMA and UV adopted the Submissions of the HSU (the ‘Union Submissions’). HammondCare also provided their Submissions. Unfortunately, both the Union and HammondCare Submissions failed to properly address the application of the BOOT as they both address matters and Agreement clauses individually, rather than as an overall assessment of more and less beneficial terms under the Agreement for classes of employees.

[12] By way of example, the Union Submission asserted: -

‘....the proposed agreement should not be approved in its current form, as the impact of these issues make the agreement worse off than the relevant Award, for some employees proposed to be covered by the agreement.’

[13] There was, however, no specific identification of the ‘some employees’ said to be disadvantaged. The Union Submission then went on to propose an appropriate undertaking to remedy the disadvantage of each item raised, irrespective of any benefits otherwise provided by the Agreement.

[14] The Union Submission also annexed a document titled ‘Summary of Proposed Undertakings – HSU Submission,’ a copy of which is Annexure ‘B’ to this Decision. That document outlines the thirteen (13) matters at issue between the parties. Those issues will be addressed below and assessed as to whether they are less, or more, beneficial for classes of employees.

[15] In its Submissions, HammondCare focused primarily on whether the Unions had complied with the Directions as to the filing of evidence, whether the Form F18’s of the Unions can be accepted as evidence and even, extraordinarily, that false declarations had been made. 2 Those Submissions were unconvincing but, insofar as they relate to sufficiency of evidence, I note the HSU filed seven (7) witness statements in reply (albeit that one was unsigned).

[16] HammondCare also submitted that disputed provisions of the Agreement were uncontroversial because ‘the proposed Agreement for approval by FWC is an amalgamation of three (3) HammondCare Enterprise Agreements as illustrated below in Figure 1: -

‘Each of the three original Agreements were previously approved by either Fair Work Australia or the Fair Work Commission meeting the appropriate legislative requirements.’ 3

[17] That Submission is, of course, inconsistent with the test outlined in s.193(1) of the Act. The existence of the same, or a similar, provision in another predecessor agreement cannot be seen as proof that an award covered employee would be better off overall if that particular term applied to the employee. The predecessor agreement, when approved, would have been considered as a whole against the relevant modern award that existed at that time. The comparator is the relevant modern award.

Matters in Issue

1. Meal Breaks (Clause 16.1)

[18] In the Union Submission, the challenge to the meal break provision of the Agreement was based upon the clarity, or lack thereof, of the information provided to employees about this provision prior to the vote. 4

[19] The Union Submission then proposed the following: -

‘In order to remedy the disadvantage caused by employees not being properly informed of the impact of change, ‘undertaking 1’ is proposed.’

[20] Were it the case that employees were not properly informed prior to the successful vote, that mischief could not be cured by undertaking. In that circumstance, the Commission could not reach the level of satisfaction required by s. 186(2) and s.188 of the Act.

[21] Nonetheless, I am satisfied that employees were appropriately informed regarding the terms of the Agreement prior to the successful vote, particularly the clarification of Clause 16.1.2 of the Agreement. The Union Submission on this issue is rejected. That conclusion is based upon the documents provided by HammondCare to my Chambers annexed to an email dated 22 March, 2019. Those documents were: -

1. An email dated 29 March 2019 to Unions to initiate bargaining;

2. An email dated 3 April 2018 to staff with letter from General Managers outlining the bargaining process;
3. An email dated 3 April 2018 to staff with a copy of NERR;
4. An email dated 9 April 2018 to Unions with a copy of NERR;
5. An email to staff dated 21 September 2018 containing Letter from General Managers outlining the process and supports and hard copy availability of relevant documents, Voting Instructions, Proposed Enterprise Agreement for Approval by vote, NES and Enterprise Agreement Offer Summary.
6. An email dated 28 September 2018 to staff providing updated Offer Summary;
7. An email dated 28 September 2018 to staff correcting information that was provided earlier; and
8. An email dated 28 September 2018 to staff clarifying Clause 16 where a missing word ‘provided’ would be included.

1. Rates of Pay (Care Service Employee Grade 3)

[22] The Union Submission seeks an undertaking that Care Service Employees Grade 3 under the Agreement will be paid at least the rate of pay prescribed in the Aged Care Award 2010 for an Aged Care Employee Level 7. The Union Submission focuses on the responsibility under the Agreement definition for ‘leading and/or supervising the work of others.’

[23] HammondCare submits that Care Service Employees Grade 3 are not required to hold Certificate 3 or higher qualifications, and they are supervised by Registered Nurses and Managers. HammondCare also submits the classification description is exactly the same as the previous agreement approved in 2016.

[24] While it is correct to observe that the Care Service Employee Grade 3 definition is designated as having responsibility for leading and/or supervising the work of others, the Aged Care Employee Level 7 in the Aged Care Award 2010, by comparison, is a considerably more senior role, and the highest classification under the Aged Care Award 2010.

[25] An accurate comparison to the provisions of the relevant Modern Award would be to an Aged Care Employee Level 5, with employees at that classification being capable of functioning semi-autonomously and prioritising their own work, responsible for work performed with a substantial level of accountability, working either individually or in a team, and assisting with supervision of others.

[26] The rate of pay for a Care Service Employee Grade 3 under the Agreement is greater than an Aged Care Employee Level 5, so this term is more beneficial than the relevant Modern Award, though not to the extent asserted by HammondCare.

2. Rates of Pay (Specialised Dementia Carer Grade 3)

[27] A similar argument to that for Care Service Employee Grade 3 was put for Specialised Dementia Carers Grade 3. Focus was placed in the Union Submission on the significant supervisory responsibilities and specialisation for the Specialised Dementia Carers Grade 3 role.

[28] HammondCare submits that Specialised Dementia Carers Grade 3 are not required to hold Certificate 3 or higher qualifications, and must comply with the resident’s case/care management plan prepared by them under the direct supervision of an RN/SDA and/or Manager, by whom they are supervised.

[29] HammondCare submits that the Agreement classification description is equivalent to the Modern Award Aged Care Employee Level 4, while the Union Submission places the work at Aged Care Employee Level 5 or Level 7.

[30] An accurate comparison to the provisions of the relevant Modern Award would be to no more than an Aged Care Employee Level 5, with employees at that classification being capable of functioning semi-autonomously and prioritising their own work, responsible for work performed with a substantial level of accountability, working either individually or in a team, and assisting with supervision of others.

[31] The rate of pay for a Specialised Dementia Carers Grade 3 under the Agreement is greater than an Aged Care Employee Level 5, so this term is more beneficial than the relevant Modern Award, though not to the extent asserted by HammondCare.

3. Minimum Hours (Clause 13.3)

[32] The Union Submission sought an undertaking that provided, in the case of broken shifts of multiple engagements for part-time and casual employees, for a minimum payment of two (2) hours for each engagement.

[33] HammondCare made the following detailed Submission on this issue, that dealt with categories of employees affected and detriment or otherwise when compared to the relevant Awards: -

‘The undertaking is not agreed to. The only employees at HammondCare that work broken shifts are Home Care employees employed in the HammondCare at Home service portfolio. The applicable award is the Social, Community, Home Care and Disability Services Industry Award 2010(SCHADS) that sets no minimum hours for Part Time employees and sets a minimum of 1 hour per engagement for casual employees Clause 10.4(c)(ii). In addition clause 25.6 Broken Shifts applies and has no hours per engagement specified. HammondCare Home Care employees in addition receive a Broken Shift allowance of $22 per break.

For HammondCare Residential casual/part time employees covered by the Aged Care Award, the EA provides they can work broken shifts by mutual agreement and would receive at least two hours pay for each shift, broken or otherwise, with a minimum of 1 hour per client engagement and an $8.50 allowance per break in shift. There is no allowance for broken shift in the Awards. The Award applies in such a manner that they would be paid at least 2 hours pay for that ‘engagement’ as per clause 22.7(b) and 22.7(c) which states “Subject to clause 22.8, except for meal breaks, the hours of work on any day will be continuous. i.e., the “engagement” applies to work a whole shift pursuant to clause 22.8 whole broken shift, in other words a minimum payment of 2 hours applies to work a whole broken shift. Therefore the proposed EA meets the SCHADS Award and the Aged Care Award minimum as the EA guarantees the minimum payment of 2 hours for the shift, plus it pays 1 hour per client engagement and if it was worked in Residential Care an $8.50 allowance.’

[34] The Unions did not reply to or put in issue that Submission, and the provisions of the relevant Awards are as referred to by HammondCare. For example, Clause 10.4(c)(ii) of the SCHADS Award does set a minimum of one (1) hour engagement for casual home care employees. There would not be any detriment to be considered in the BOOT.

4. Broken Shifts (Clause 13.4)

[35] The Union Submission sought the removal of the words, ‘Other than for HCAH Employees,’ from Clause 13.4.1.1 of the Agreement, so that for all employees it would provide ‘the ‘breaks’ in a broken shift will not be more than four hours and may be worked by mutual agreement.’

[36] The Unions submitted that both the Aged Care and SCHADS Awards required mutual agreement for broken shifts. They also submitted broken shifts were ‘common place’ for HammondCare at Home employees.

[37] HammondCare, in their Submission, simply referred to their Submission extracted at paragraph [33] above. That Submission did not, however, deal with whether HammondCare at Home employees could currently be required to work broken shifts.

[38] In a statement in reply of Mr. Friend, it was submitted that HammondCare at Home employees are demonstrably worse off as they may be directed to work a broken shift and do not have the right to refuse such a shift.

[39] While HammondCare asserted in Supplementary Submissions that Clause 25.6 of the SCHADS Award allowed for broken shifts without agreement, I was unconvinced that the totality of that Award allowed such direction. The existing Agreement clause is a less beneficial term that must be taken into account in applying the BOOT to the category of HammondCare at Home employees.

5. Allocated Day Off (Clause 15)

[40] The Unions submitted: -

‘The Aged Care Modern Award does not prescribe any limit for the number of ADOs which may be accrued. However, the enterprise agreement does provide a limit of 5 days.

Therefore, in some cases, the proposed agreement may be worse off for some employees.’

[41] HammondCare submitted: -

‘The undertaking is not agreed to. The EA provides ADOs to both Home Care employees (SCHADS Award) and Residential Care employees (Aged Care Award). The SCHADS Award does not provide for ADOs. This is a misrepresentation by the HSU and a false statement. The HSU have applied an incorrect interpretation of the proposed EA clause 15.4. The five day limit is not applied to the accrual of the ADOs it’s applied to the number of ADOs that may be taken in a block at any one time and/or in conjunction with taking a period of annual leave. The EA is better off overall than the relevant awards.’

[42] The Unions did not reply to, or put in issue, that Submission. There is not any detriment to be considered in the BOOT.

6. Attendance at Meetings and Training (Clause 19)

[43] The Union Submission expressed concern about the loss of entitlements to minimum engagement, and weekend penalties or overtime, for attendance at meetings that may occur at times when such payments would accrue, and proposed an undertaking to address that perceived loss.

[44] HammondCare, in their original Submission, asserted: -

‘The undertaking is not agreed to. The clause is based on the ACSA template. HammondCare provides ongoing training at HammondCare’s expense and for employees to receive remuneration for undertaking training outside of normal work hours. Time spent in training in outside normal hours maybe compensated by the employee taking paid time in lieu. This is consistent with previously approved EAs throughout the industry, however the HammondCare clause offers better terms than the industry standard. When not possible to train employees during their rostered work hours, training may be convened outside those hours without attracting an overtime penalty. If the training hours were to be defined as overtime, it was a productivity issue in that employees were not directly performing productive work while in meetings and/or training, this would be a disincentive for employers to train employees.’

[45] Curiously,and not in response to any reply Submission by the Unions, HammondCare in their Supplementary Submission asserted that such meetings and training ‘does not occur in out of normal rostered hours on weekends.’ That was the totality of the Submission.

[46] The Agreement provision is a less beneficial term to be taken into account in applying the BOOT to HammondCare employees. The extent of that detriment is difficult to assess. The Unions assert, ‘HSU members report that such meetings are a (sic) occur regularly, several times per year and usually for short meetings or training sessions of one or two hours.’ HammondCare however, as noted above, submits that such meetings ‘does not occur in out of normal rostered hours on weekends.’ Nonetheless, the detriment, whatever its level, must be considered in the BOOT.

7. Higher Duties (Clause 20)

[47] The Unions submitted: -

‘The enterprise agreement is at best equal to the relevant Awards, but likely worse off.

Both the Aged Care Modern Award and the SCHADS Award provide higher duties payment for the full shift, when the higher duties are performed for more than two hours.

However, the enterprise agreement only pays for the time the duties are carried out, which may be more than two hours, but less than a full shift.

For example, an employee engaged on an 8 hour shift, who acts up in higher duties for half of that shift, would be entitled to 8 hours of higher duties pay under either Award, but only 4 hours of higher duties pay under the enterprise agreement.

Therefore, the provision in the proposed agreement is worse off than the provision in each of the relevant Awards.’

[48] HammondCare submitted: -

‘HammondCare EA Clause 20 is far in excess of the Nurses Award clause 30. However HammondCare agrees to the proposed undertaking wording to wholly replace Clause 20 of the EA, but not in addition to the EA clause 20.’

[49] The undertaking proposed by HammondCare extinguishes whatever detriment was contained in the Agreement compared to the relevant Modern Awards.

8. On Call Allowance (Clause 23.7.1)

[50] The Union Submission highlighted the absence of on-call provisions under the Aged Care Award, and that the on-call allowance rates were higher under the SCHADS Award than under the Agreement.

[51] HammondCare submitted: -

‘The undertaking is not agreed to. On Call provisions in the HammondCare EA are applicable to employees who are on call, in HammondCare only Nurse classifications are required to be on-call and rarely. Therefore the appropriate award for BOOT purposes is the Nurses Award. EA 2018 Annexure 1 items 8, 9 and 10 use the applicable Nurses Award rates as varied from time to time and move accordingly. Therefore the EA meets the BOOT as no other employees are affected. If the HSU are aware of any other employees affected then sworn evidence should be produced so that HammondCare would be afforded the opportunity to remedy such situations.’

[52] The HSU did not respond by way of reply Submission on this issue, and while the statement of Ms. Heather Waddell contained the following sentence: -

‘HammondCare are only obliged to pay me for a minimum contract of 20 hours I am not paid any ON CALL money,’

no issue was taken with the HammondCare Submission. There is not any detriment to be considered in the BOOT on this issue.

9. Annual Leave Loading (Clause 26.10)

[53] The Unions submitted: -

‘The proposed agreement would make several groups of employees worse off than the provisions of the Award.

The agreement mirrors both the Aged Care Modern Award and the SCHADS Award, in that employees are paid annual leave loading of 17.5%, or the weekend and shift penalties the employee would have received had they not been on leave during the relevant period, whichever is the higher.

However, the proposed enterprise agreement limits annual leave loading to only 4 weeks per year (clause 26.10.1).

The Awards do not provide any such limit.

This means that a shift worker, who is entitled to 5 weeks annual leave per year, is worse off.

Further, it means anyone who has accrued more than 4 weeks annual leave and takes it, is worse off.’

[54] HammondCare, in their original Submission, asserted: -

‘The undertaking is not agreed to. By comparing the annual award pay plus the award Annual Leave loading on five weeks to the annual EA pay plus the Annual leave Loading on four weeks the EA overall remuneration is still greater than the award for all classifications. This is illustrated in the spreadsheet example attached and marked “JW 14A.’

[55] The Annexure ‘JW 14A’ is Annexure ‘C’ to this decision.

[56] In reply, the Unions relied on the statement of Mr. Christopher Friend, dated 5 April, 2019, which stated: -

‘The Agreement has annual leave loading terms which are demonstrably worse off than both the Aged Care Award and the SCHADS Award.

Based on the analysis at ‘CF3’, some employees would be several hundreds of dollars worse off under the terms of the Agreement when compared to annual leave loading clause of the Aged Care Award and the SCHADS Award.’

[57] The Annexure ‘CF 3’ is Annexure ‘D’ to this Decision.

[58] In its Supplementary Submission, HammondCare noted: -

‘The HSU Submission and evidence of Mr Friend misinterpret the meaning of clause ‘26.10.1 Annual Leave Loading is only payable on four weeks of Annual Leave per year.’ By conveniently ignoring the words “per year”. Per year applies as per the accrual of annual leave on pro rata basis, therefore the loading is paid accordingly or rolled over into the next year.

The clause only has application to employees who are entitled to five weeks leave accrual per year in that for each 5 weeks they take of annual leave, loading is paid on 4 weeks per year. E.g. If an employee has accrued 11 weeks annual leave being 8 weeks of annual leave plus 2 weeks of additional shift work annual leave, then take the 11 weeks they are paid loading on 9 weeks. Because of the definition of shift worker clause 26.1.2 the fifth week accrues per year after meeting the work criteria e.g. see 26.1.2. a, b and c. the HammondCare payroll system records normal annual leave and shift work additional leave separately.

However the example quoted cannot arise due to the effect of Clause “26.5 Taking of Annual Leave

26.5.1 Generally Annual Leave will be taken within six months of the Employee becoming entitled to Annual Leave of more than four weeks, however with mutual agreement the taking of leave may be delayed for an additional six months.

26.5.2 The Employee and HammondCare will attempt to reach agreement on the dates for taking the leave, having regard to HammondCare’s operational requirements.

26.5.2.1 In the absence of agreement, HammondCare will give at least four weeks’ notice to the Employee of the dates during which the Employee will be required to take Annual Leave.

26.5.3 To avoid accumulation of excessive Annual Leave entitlements, HammondCare may direct an Employee to take any Annual Leave in excess of eight weeks.”

The evidence of Mr Wright and the calculation provided illustrates that the Agreement is better off overall.

[59] I accept the evidence of Mr. Wright and the calculations in Annexure ‘JW 14A.’ The calculations of Mr. Friend appear to suffer from the defect outlined in the HammondCare Supplementary Submission. For the purposes of the BOOT, on this issue there is a detriment, albeit minor, and an assessment of the overall disposition of that detriment as compared to the remuneration increases under the Agreement is contained in Annexure ‘JW 14A’ that is Annexure C to this Decision.

10. Compassionate and Natural Disaster Leave (Clause 31)

[60] The Unions submitted: -

‘The proposed agreement provides an entitlement for two days paid Compassionate Leave, to permanent employees, when a family member dies or develops a life threatening condition or injury.

The agreement also provides that HammondCare ‘will consider’ extending paid leave to other circumstances, such as an employee experiencing incidents of domestic violence.

While the potential for paid leave to deal with incidents of family violence could be more beneficial than both the Aged Care Award and the SCHADS Award, the agreement fails to meet other key features of the ‘Leave to deal with Family and Domestic Violence’ clause in each Award. For example:

● Any leave under the agreement is completely subject to the employer’s discretion, whereas the Award provides stronger rights for an employee to access the leave (albeit unpaid);

● The agreement provides no definition of what family and domestic violence is;

● The scope of the agreement provision is more limited than the Award provision;

● The agreement does not provide any conditions regarding confidentiality that will be made by an employer under such circumstances.

Therefore, the agreement may be better off in regard to the paid leave entitlement but may not be better off overall when considering the full provisions of the Award.’

[61] HammondCare, in their original Submission, asserted: -

‘The undertaking in the words proposed is not agreed. The EA terms in Clause 31 read in conjunction with the effect and application of the agreed undertaking for EA Clause 3.3 meets and is more beneficial than the NES.’

[62] I agree with the Unions’ Submission. Employees are better of overall regarding paid leave entitlements but worse off regarding non-monetary entitlements, and appropriate consideration will be placed on each in the application of the BOOT.

11. Meal Breaks (Clause 16.1)

[63] This was the second time issues regarding Meal Breaks were agitated by the Unions. The Unions submitted: -

‘The employee is only paid ordinary rates for working through their meal break and there is no requirement for the employer to reach agreement with the employee to work through their meal break.

This is significantly worse off than the provisions of the Aged Care Modern Award.

The Aged Care Modern Award gives the employee the benefit of a meal break after working five hours (as opposed to six in the proposed agreement).

The Aged Care Modern Award also provides that overtime rates are to be paid if an employee is required to work through their meal break, until the employee is released from duty or able to take a proper break.

Many HSU members have reported being directed to work through their meal breaks without reasonable compensation.’

[64] HammondCare, in their original Submission, asserted: -

‘The undertaking is not agreed to. See response to ‘Undertaking 1’ above.

The SCHADS Award 27.1(c) and Aged care Award clause 24.1(b) enables the employer to “require” an employee to have a meal with clients or client or work during a meal break. “Designate” in EA clause 16.1.2 has the same meaning and practical effect as ‘require’. There is no difference to the award clauses. The SCHADS Award does not require the employer to provide a meal, whereas as per HammondCare’s section 598(1) and s.602 Application HammondCare would provide a meal and pay single time.

The undertaking is not agreed. The EA clause 16.1.2 (as amended) provides that where an employee is designated (required) to have a provided meal with client/s then single time would be paid as the provision of a meal at the employers cost is offset against the payment of overtime. As per EA clause 16.1.2.1Where an employee is designated (required) to work during a meal break and a meal is not provided overtime rates apply.’

[65] In the Union reply Submission, it was asserted: -

‘First it is apparent that the Agreement term is less beneficial than either award term in that the Agreement allows for a meal break after six hours, as opposed to the more beneficial arrangement under each award for a meal break after five hours.

Secondthe Agreement is less beneficial as compared to the relevant term in the Aged Care Award 2010 in that the Agreement allows the Applicant to designate relevant employees to be on standby or to work during their meal break and receive only the base rate of pay, as opposed to the overtime rate.

Thirdthe agreement is less beneficial than the Social, Community, Home Care and

Disability Services Industry Award 2010 because the ability to require an employeeto

work during their meal break:

a. does not restrict the circumstances in which such a requirement can be made to’part of the normal work routine or client program’; and

b. also allows the worker to be put on ‘standby’ which is not a circumstance to maintain base rate during a meal break under the Social, Community, Home Care and Disability Services Industry Award 2010.

The evidence in the Power Statement and the Thackray Statement highlights the intangible non-monetary disadvantage that would be faced by relevant employees within the coverage of the Aged Care Award 2010 considering their current conditions of employment.

The Millington Statement provides evidence of the widespread nature of staff missing an uninterrupted meal break. This is corroborated by the Friend Statement at attachment CF-5 and by Laing Statement. The more frequent the occurrence of the interrupted meal break, the more significantly it will impact Test considerations.

The Friend Statement, at attachment CF-2, calculates the monetary value of missed meal breaks. It evidences significant disadvantage that arises from the Agreement.

Considering the frequency of meal break interruptions, and the marginal above-award pay rates contained in the Agreement, this factor alone could cause the Agreement not to pass the Test.’

[66] The Agreement clause is a less beneficial term that must be taken into account in applying the BOOT, though not to the extent asserted by the Unions. There is clearly an additional hour of work before the entitlement arises, and pay entitlement is reduced to ordinary time. However, the calculation of detriment attached to Mr. Friend’s Statement appears to be exaggerated and not reflective of the evidence.

12. Allowances – Travel on Official Business (Clause 23.1)

[67] The Unions submitted: -

‘The proposed agreement seeks to limit the travelling allowance available to Home Care Workers.

The effect of Clause 23.1.2 would be to impose extreme disadvantage on a large, and growing, segment of HammondCare’s workforce.

The HSU has serious concerns that the construction and application of this part of the agreement is contrary to the SCAHDS Award and will likely leave the vast majority of Home Care Workers, worse off overall.’

[68] HammondCare, in their original Submission, asserted: -

‘The HSU in their Form 18 (if accepted by FWC) and Submissions in regard to their claim for travel from home to work and travel from work to home be paid for Vehicle and Travel Allowances16 EA clause 23.1 are in effect a request to interpret the relevant Award clauses to have the meaning “in the courses of their duties” includes travel from a Careworkers home to the first client and travel to home from the last client is travel “in the course of their duties”. The HSU are seeking a term be implied in the Award that “in the courses of their duties” includes travel from a Careworkers home to the first client and travel to home from the last client is travel “in the course of their duties”. While the EA clause 23.1 use the term “official business” in substitution for the Awards phrase “course of their duties” the clause 23.1.2 terminology resolves any ambiguity or uncertainty in the interpretation of “course of the duties” in the Award by specifically detailing what is not in course of their duties and is excluded from being eligible to be paid the allowance.

In addition the EA provides in clause 23.2 an additional benefit to employees who may feel they are disadvantaged in some way by having to travel in “extraordinary circumstances”. Any dispute over the merits of any particular claim can be dealt with by the EAs disputes procedure Clause 9.

Hence the HSUs Undertaking 13 is not necessary as it would reduce the clarity and certainty provided by the current EA and proposed EA clause 23.1. In addition the proposed Undertaking is not the industry standard.

[69] In the Union reply Submission, it was asserted: -

‘Contrary to [49] of the Applicant’s Submissions, the HSU is not seeking that ‘term be implied in the Award’ by the Commission. The HSU submits that the relevant award clauses5 at law entitle a greater entitlement to some employees than would be applicable under the Agreement.

An equivalent provision in the Nurses and Midwives (Victorian Public Health Sector) (Single Interest Employers) Enterprise Agreement 2012–2016 was considered by the Full Court of the Federal Court.7 The Full Court determined that, in particular, that term did not require payment for travel to the first or from the last location of work primarily because the employee in that case ‘had regular hours and regular places of work.’

So much cannot be said for the Applicant’s relevant employees. The Applicant can, and does, require its employees to work at a variety of locations, being the private homes of clients, without the same notice or agreement requirements. The Applicant does, in fact, require its relevant employees to have their own vehicles for precisely that purpose.

Whether the allowance under the awards would be payable would need to be determined on the basis of the relationship between each individual employee and their work locations on the facts of each case.’

[70] In its Supplementary Submission, HammondCare submitted: -

‘HammondCare will not give an undertaking in regard to travel to and from home, save that the proposed Agreement clause 23.2 enables Extra Ordinary Circumstances to be determined on the basis of the merits of the claim of the individual employee and the relevant facts and circumstances. The proposed Agreement’s Disputes Procedure Clause 9 is relevant.

HammondCare relies on the evidence of Melissa Muhs and the fact that such an increase in costs to HammondCare singled out in the industry where other providers do not pay travel to/from home to work, would place HammondCare at significant disadvantage in the market place when compared to providers who have already had their Agreements approved by the Commission that have the same and/or similar terms in their Agreements. See the Witness Statement of Anna-Maria Wade. This would create an “extraordinary circumstance” for HammondCare and it would not be in the public interest for such an increase in costs to be precedent in the proposed HammondCar Agreement and therefore imposed on the industry thereafter, aged care and dementia clients, their families and Commonwealth Govt funding for Aged Care packages currently being scrutinised by a Royal Commission. If the proposed Agreement does not meet the BOOT the Commission may otherwise approve the Agreement pursuant to s.189 of the FairWork Act.’

[71] The evidence filed by the Unions in reply establishes that vehicle allowance is not currently paid for travel to the first client in a shift or back home from the last client. 5 Thatinterpretation and application of the existing Modern Award provision is consistent with the decision of the Full Court of the Federal Court in Tyndall v Goulburn Valley Health,6 which considered a not materially different provision in an agreement. The Agreement clause would therefore not be detrimental when compared to the Modern Awards.

Undertakings/Corrections Provided

[72] By email dated 28 September, 2018, 7 Clause 16 was clarified prior to the vote on 14 October, 2018, when the Agreement was made. It clarified that the term ‘provided’ had been inadvertently been left out before the words ‘meal with a client/resident.’ That amendment should be confirmed by formal undertaking by the Applicant.

[73] The Applicant has also agreed to provide undertakings in regard to Issue 8 Higher Duties (Clause 20) above, and Clause 3.3 regarding the NES. 8 Those undertakings should be formally made and annexed to the Agreement.

Less Beneficial Terms

[74] The Agreement, as varied by the undertakings made in the above two paragraphs, contains the following less beneficial terms when compared to the relevant Modern Awards: -

(a) Issue 5 regarding broken shifts, insofar as it applies to HammondCare at Home employees;

(b) Issue 7 regarding attendance at meetings and training;

(c) Issue 10 regarding annual leave loading, thought the detriment is to the extent expressed at paragraph [58] above;

(d) Issue 11 regarding compassionate and natural disaster leave, to the non-monetary extent outlined above;

(e) Issue 12 above regarding meal breaks;

(f) Shift and weekend penalties that correspond to the Nurses Award 2010; and

(g) The absence of laundry allowance.

More Beneficial Terms

[75] The Agreement contains the following more beneficial terms when compared to the relevant Modern Awards: -

(a) The rates of pay under the Agreement all exceed the relevant Modern Awards, and in higher grades equivalent to the Nurses Award 2010 those increases are significant (at least offsetting the less beneficial shift and weekend penalties for those employees);

(b) The only challenges to the extent of benefit, or otherwise, in rates of pay were in relation to issue 2, ‘Rates of Pay (Care Service Employee Grade 3)’, and Issue 3, ‘Rates of Pay (Specialised Dementia Carer Grade 3)’, where I found the rates of pay to be more beneficial than the relevant Modern Award, though not to the extent asserted by HammondCare;

(c) Compassionate and natural disaster leave, to the monetary extent outlined above;

(d) Casual conversion after 26 weeks;

(e) A more favourable higher duties provision;

(f) A disputes settlement procedure that allows for ‘any matter’ to be arbitrated by the Commission;

(g) Broken shift allowance; and

(h) Remuneration packaging pursuant to Clause 25 of the Agreement.

Conclusion

[76] The BOOT requires consideration of whether employees are better off overall if the Agreement applied rather than the relevant Modern Award. Considering that question, and noting the objections of the Unions, I am satisfied that, subject to the provision of the undertakings identified, that the Agreement passes the BOOT.

[77] The HSU, the NSWNMA and UV all gave notice under s.183 of the Act that they wished to be covered by the Agreement. In accordance with s.201(2) of the Act and based on the statutory declarations provided by those organisations, I note that the Agreement covers those organisations.

[78] The Agreement is approved and, in accordance with s.54, will operate from 6 June 2019. The nominal expiry date of the Agreement is 31 December 2021.

DEPUTY PRESIDENT

Annexure ‘A’

Annexure ‘B’

Summary of proposed undertakings – HSU submission

Undertaking 1 - Meal Breaks (Clause 16.1)

HammondCare agrees that Clause 16.1.2 of the agreement will be read as follows:

16.1.2 Requirement to work and/or be on standby during Meal Breaks - By agreement between HammondCare and an Employee, HammondCare for operational reasons may designate an Employee as being required to be on standby or have a meal with a client/resident during their Meal Break and in this case, the Employee will be paid their base rate of pay plus applicable loadings/shift penalties for their Meal Break time for every day or shift so worked.

Undertaking 2 – Rates of Pay (Care Service Employee Grade 3)

HammondCare agrees that all employees classified as Care Service Employee Grade 3 will be paid, at least, the rate of pay prescribed in the Aged Care Award 2010 for an Aged Care Employee Level 7.

Undertaking 3 – Rates of Pay (Specialised Dementia Carer Grade 3)

HammondCare agrees that all employees classified as Specialised Dementia Carer Grade 3 will be paid, at least, the rate of pay prescribed in the Aged Care Award 2010 for an Aged Care Employee Level 7.

Undertaking 4 – Minimum Hours (Clause 13.3)

Clause 13.3 of the agreement shall be read as follows:

Part-time and Casual Employees shall receive a minimum payment of two hours for each engagement of work. In the case of a broken shift this may include multiple engagements, of at least 2 hours per engagement, as per clause 13.4 ‘Broken Shifts’.

Undertaking 5 – Broken Shifts (Clause 13.4)

In clause 13.4.1.1 the words ‘Other than for HCAH Employees’ will not apply and the clause

will be read as follows, for all employees:

The ‘breaks’ in a broken shift will not be more than four hour and may be worked by mutual

agreement.

Undertaking 6 - Allocated Day Off (Clause 15)

HammondCare agrees that clause 15.4 of the agreement will be read as follows:

With mutual agreement, ADO’s may be accumulated and taken in conjunction with the Employee’s annual leave, or at another time as agreed between the Employee and HammondCare.

Undertaking 7 - Attendance at Meetings and Training (Clause 19)

HammondCare agrees that clause 19.1 and 19.1.1 of the agreement will be reflected as follows for the life of the agreement:

19.1 When an Employee is required by HammondCare to attend meetings in the capacity of an Employee representative, or meetings for work-related purposes, training or registration, outside of the employee’s normal rostered ordinary hours of work, that Employee will be entitled to receive, at least, their minimum engagement, plus any applicable weekend penalties, shift penalties, or overtime for attendance at such meetings.

Undertaking 8 - Higher duties (Clause 20)

HammondCare agree that in addition to Clause 20 of the agreement, a new clause 20.1 will apply which states:

An employee engaged in any duties carrying a higher wage rate than the classification in which they are ordinarily employed in any one day or shift will be paid at the higher wage rate for:

a. the time so worked for two hours or less; or

b. a full day or shift where the time so worked exceeds two hours.

Undertaking 9 - On Call Allowance (Clause 23.7.1)

HammondCare agree that an employee will only be on-call by mutual agreement and clause

23.7.1 of the agreement will be read as follows:

23.7.1 An Employee who is asked by HammondCare, and agrees to be on call to possibly work overtime on a rostered day off, shall be paid the amount specified in Annexure 1 for each period of 24 hours or part thereof, provided that only one allowance shall be payable in any period of 24 hours. For the purpose of this clause the whole of the on-call period is calculated according to the day on which the major portion of the on-call period falls.

HammondCare agree that the rate of pay for the on-call allowance will be at least as generous as the relevant rate in the Social, Community, Home Care and Disability Services Industry Award 2010, or the Nurses Award 2010, whichever is the higher. HammondCare agree that the on-call allowance will be increased by the same proportion as any increase to relevant modern award rate.

Undertaking 10 - Annual Leave Loading (Clause 26.10) –

HammondCare agree that clause 26.10.1 of the agreement will not apply.

HammondCare agree that clause 26.10.2 will be read as follows:

26.10.2 If an Employee is entitled to Annual Leave, the greater of either leave loading at the rate of 17.5% on the appropriate base rate of pay, or usual shift allowances and weekend penalties, which would have been paid to the Employee, had the Employee worked during the period of Annual Leave, will be paid. Provided that shift allowances and weekend penalties will not be payable for public holidays which occur during a period of Annual Leave or for days which have been added to Annual Leave in accordance with Clause 33 Public Holidays.

Undertaking 11 - Compassionate and Natural Disaster Leave (Clause 31) HammondCare agrees to adopt the model ‘Leave to deal with Family and Domestic Violence’ clause as a term of this agreement.

Undertaking 12 – Meal Breaks (Clause 16.1)

HammondCare agrees that Clause 16.1.2 of the agreement will be read as:

16.1.2 Requirement to work and/or be on standby during Meal Breaks - By agreement between HammondCare and an Employee, HammondCare for operational reasons may designate an Employee as being required to be on standby or have a meal with a client/resident during their Meal Break and in this case, the Employee will be paid their base rate of pay plus applicable loadings/shift penalties for their Meal Break time for every day or shift so worked.

HammondCare agrees that Clause 16.1.2.1 of the agreement shall be replaced with the following:

16.1.2.1 Where an employee is required to remain available to attend to duty or is on duty during their meal break, the employee will be paid at overtime rates for all time worked from the commencement of that meal break until such time that a meal break free from duty is taken by the employee or the employee’s shift ends (whichever occurs first). Whilst payment will be calculated at overtime rates, the time worked until the meal break is taken will be regarded and count as an employee’s ordinary time.

Undertaking 13 - Allowances - Travel on official business (Clause 23.1)

The HSU is happy to consider two possible undertakings to remedy this disadvantage.

Undertaking 13a

HammondCare agrees that in clause 23.1.2, the sentence ‘This excludes travel from the

Employee’s home to the first place of work/office, and return home at the end of their duties,

and excluding travel during a break in a Broken Shift.’, shall not apply. Clause 23.1.2 will simply read as follows:

23.1.2 Where an Employee is required to use his or her motor vehicle on official business they shall be paid at the Vehicle Allowance rate as set out in Annexure 1.

Undertaking 13b

HammondCare agrees that clause 23.1.2 in the agreement shall not apply and shall be replaced with the following:

23.1.2 Where an employee is required and authorised by their employer to use their motor vehicle in the course of their duties, the employee is entitled to be reimbursed at the rate of

$0.78 per kilometre.

Annexure ‘C’

Annexure ‘D’

 1   Form F16, Q. 2.8.

 2   HammondCare Submission dated 22 March, 2019 at [8] to [30].

 3   HammondCare Submission dated 22 March, 2019, at [35] and [36].

 4   Union Submission of 3 March, 2019, at [7] to [17].

 5 Statement of Heather Waddell dated 3 April, 2019, at [17]; Statement of Pamela Wilcock dated 3 April, 2019, at [17].

 6 [2016] FCAFC 139.

 7   Statement of Jeff Wright dated 22 March 2019, Annexure “JW 13”.

 8   Statement of Jeff Wright dated 22 March 2019, at Para [28] and Annexure “JW 15”.

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