Infant Nutrition Canning Australia Pty Ltd
[2024] FWC 3267
•25 NOVEMBER 2024
| [2024] FWC 3267 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.319 - Application for an order relating to instruments covering new employer and non-transferring employees
Infant Nutrition Canning Australia Pty Ltd
(AG2024/4145)
| Food, beverages and tobacco manufacturing industry | |
| COMMISSIONER HARPER-GREENWELL | MELBOURNE, 25 NOVEMBER 2024 |
Application for an order relating to instruments covering new employer and non-transferring employees
On 22 October 2024, Infant Nutrition Canning Australia Pty Ltd filed an application (the Application) in the Fair Work Commission (Commission) pursuant to s.319(1)(b) of the Fair Work Act 2009 (Cth) (the Act). The Application is made in respect of the application of Snow Brand Australia Pty Ltd – Infant Formula Division and United Workers Union Enterprise Agreement 2023[1] (the Agreement) to transferring and new non-transferring employees.
The Agreement was approved on 13 May 2024 and has a nominal expiry date of 30 June 2026.
Background
Infant Nutrition Canning Australia Pty Ltd (the Applicant), is a fully owned subsidiary of Snow Brand Australia Pty Ltd (SBA). On 1 October 2024, the Applicant commenced operation of SBA’s Infant Formula Division in 21 Mactier Street, Tatura, Victoria (Tatura Site). The Applicant became the new employer when the Infant Formula Division employees based at the Tatura Site employed in the relevant classifications covered by the Agreement were transferred to the Applicant on 1 October 2024 (Transferring Employees).
For the purposes of s.311(6) of the Act, the Applicant submits there is a connection between SBA and the Applicant as they are associated entities. It submits that a transfer of business pursuant to s.311 of the Act occurred on 1 October 2024.
The work the Transferring Employees perform for the Applicant will be the same, or substantially the same, as the work the Transferring Employees performed for SBA.
The purpose of the present application is to ensure the Agreement will continue to cover the Transferring Employees employed in the relevant classifications at the Infant Formula Division Tatura Site. Further the Agreement will also cover any new, non-transferring employees employed by the Applicant at the Tatura Site who perform or are likely to perform the transferring work covered by the classifications set out in the Agreement.
Legislation
Part 2-8 of the Act describes when a transfer of business occurs and also provides for the transfer of enterprise agreements from one employer to another in a transfer of business.
Section 311(1) of the Act defines “transfer of business” and s.312 defines the types of “transferable instrument” that may transfer from one employer to another. Section 313(1) provides that if a transferable instrument covered the old employer and a transferring employee immediately before the termination of the transferring employee’s employment with the old employer then (a) the transferable instrument covers the new employer and the transferring employee in relation to the transferring work after the time (the transfer time) the transferring employee becomes employed by the new employer; and (b) while the transferable instrument covers the new employer and the transferring employee in relation to the transferring work , no other enterprise agreement or named employer award that covers the new employer at the transfer time covers the transferring employee in relation to that work.
Sections 317 and 319 empower the Commission to make orders in relation to a transfer of business, including orders that a transferable instrument will, or will not, cover the new employer in relation to the non-transferring Employee.
Consideration
I am satisfied that there has been a transfer of business between SBA and the Applicant for the purposes of s.311(1) of the Act. The Transferring Employees have been offered and accepted employment with the Applicant to perform the same work as they were performing whilst employed by SBA, on substantially the same terms and conditions of employment.
I am also satisfied the recently approved Agreement is a transferable instrument for the purposes of s.312(1)(a) of the Act.
I further note that in an email dated 19 September 2024, the United Workers’ Union (UWU) acknowledged a transfer of business under Part 2-8 of the Act has occurred and support the application being made. On 7 November 2024, I issued directions seeking submissions and providing an opportunity for the UWU to be heard before determining the application. On 19 November 2024, the UWU informed my Chambers that they supported the making of the application as sought by the Applicant and that wouldn’t be making any further submissions.
In deciding whether to make orders of this kind, the Commission must take into account the factors set out in s.319(3) of the Act. I will deal with each of those matters separately.
s.319(3)(a) - The views of the new employer and the employees who would be affected by the order
The Applicant submits that there are no non-transferring employees performing the same work as the Transferring Employees. It is however the intention to engage new employees to perform the same work as the Transferring Employees in the same classifications covered by the Agreement. Further, all Transferring Employees are already covered by the terms of the Agreement and therefore will not be affected by the orders.
The Applicant submits by granting the order sought, consistency and parity in the terms of conditions of its employees within the Infant Formula Division at the Tatura Site will be provided promoting industrial harmony and certainty for future enterprise bargaining negotiations. Further, it submits simplicity in terms of the administration, human resources and payroll matters for its employees will result from granting the order sought.
The Applicant has filed significant materials in support of its application. On the basis of the materials before me I am satisfied there is presently no new non-transferring employees that would be affected by the Order. The Transferring Employees covered by the Agreement transferred on or around the 1 October 2024. On the basis of the materials before me, I am satisfied that the UWU on behalf of its members was consulted and no objections to the Application were received. The UWU explicitly supports the making of the Order sought by the Applicant.
s.319(3)(b) - Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment
The Applicant submits that no employee would be disadvantaged in their terms and conditions of employment if the Agreement were to cover new non-transferring employees. It further submits the Agreement provides superior entitlements to the terms and conditions of the alternative instrument, being the Food, Beverage and Tobacco Manufacturing Award.
I agree with the Applicant’s submission and consider that the employees would not be disadvantaged in relation to the terms and conditions of their employment should I make the order sought.
s.319(3)(c) - The nominal expiry date of the agreement
I note the Agreement has a nominal expiry date of 30 June 2026 and consider that the granting of the proposed orders would not disadvantage employees.
s.319(3)(d) - Whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace
The Applicant submits there will be a positive impact on its employees and workforce should the order sought be made as all employees performing the Transferring Work at the Tatura Site would be entitled to the same terms and conditions of employment.
Further, the Applicant submits that Agreement which was recently negotiated with the employees and UWU is better suited to their operations than the Food, Beverages and Tobacco Manufacturing Award.
There is nothing to suggest that there would be a negative impact on productivity if the order sought was made, and I am satisfied that there will be no such negative impact.
s.319(3)(e) - Whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer
The Applicant submits that it would not incur any significant economic disadvantage if the Agreement was to cover new non-transferring employees. Although the Agreement provides more beneficial terms and conditions than the Award, the Applicant submits that the efficiencies for employees, human resources and payroll counteract any economic disadvantage incurred.
I am satisfied that if the order sought were made, the Agreement’s coverage will not cause any significant economic disadvantage to the Applicant.
s.319(3)(f) - The degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer
The Applicant submits there would be greater business synergy if the same industrial instrument applied to all employees of the Applicant’s business and having the Award apply to the new non-transferring employees performing the same work would result in a greater risk of internal industrial disharmony
I accept there if the proposed order is granted it is likely to enhance the degree of synergy of the business and promote industrial harmony.
s.319(3)(g) - The public interest
It is not apparent that it would be against the public interest to issue the order sought. Granting the orders sought would enable the Applicant to provide consistency in relation to the employment terms and conditions. New non-transferring employees would be afforded the benefit of the more favourable terms and conditions of the Agreement than they would otherwise receive if covered by the Food, Beverage and Tobacco Manufacturing Award.
Conclusion
Having considered each of the matters outlined in s.319(3) of the Act and taking into account all of the circumstances, including that the UWU support the Application, I am satisfied that the conditions for making the order in the terms sought have been met. The Application is granted.
An order[2] will be issued separately to this decision.
COMMISSIONER
[1] AE524589.
[2] PR781632.
Printed by authority of the Commonwealth Government Printer
<AE524589 PR781630>
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