KAEFER Integrated Services Pty Ltd

[2019] FWCA 2929

[2019] FWCA 2929

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

KAEFER Integrated Services Pty Ltd
(AG2018/7062)

KEC ENTERPRISE AGREEMENT 2018-2022

Building, metal and civil construction industries
COMMISSIONER JOHNS	SYDNEY, 1 MAY 2019

Application for approval of the KEC Enterprise Agreement 2018-2022.

[1] An application has been made for approval of an enterprise agreement known as the KEC Enterprise Agreement 2018-2022 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (Cth) (the Act). It has been made by KAEFER Integrated Services Pty Ltd. The Agreement is a single enterprise agreement.

[2] The Employer has provided written undertakings. A copy of the undertakings is attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement.

[3] On 18 April 2019, Mr Kadir for the Applicant, wrote to my Chambers and provided the following submission in response to my request for further submissions on 17 April 2019,

“Dear Mr Simeon,

Thank you for your below email.

KAEFER understands from section 5 of the Agreement Checklist that Commissioner Johns has the following concerns:

Casual employees who are engaged in regular overtime will be disadvantaged under the enterprise agreement because they will not receive a casual loading in addition to overtime penalties; and

Part-time and casual employees who work night and/or afternoon shifts (or a combination of both) will be disadvantaged under the enterprise agreement because the applicable shift loading under the enterprise agreement (30%) is less than the shift loading under the modern award (50%).

For the reasons set out below, KAEFER submits that Commissioner Johns can be satisfied that the relevant employees are better off under the enterprise agreement than they would be under the modern award.

First Concern – Casual Loading & Overtime:

Given the significantly higher base rates of pay under the enterprise agreement, a casual employee who works regular overtime will receive more money for working overtime under the enterprise agreement than he or she would receive for working overtime under the modern award.  On an hour-for-hour basis, a casual employee would receive between $2.94 and $5.94 more per hour under the enterprise agreement when receiving time-and-a-half, and between $5.67 and $9.67 more per hour under the enterprise agreement when receiving double-time.  In particular:

Time-and-a-half	Sheet Metal Worker	Painter	Advanced Scaffolder	Cryogenic Lagger	Trades Assistant
Enterprise Agreement	$44.16	$44.16	$42.66	$42.66	$39.66
Modern Award	$39.33	$38.92	$37.47	$36.72	$36.72
Difference	+$5.94	+$2.94	+$5.94	+$2.94	+$5.94

Double-time	Sheet Metal Worker	Painter	Advanced Scaffolder	Cryogenic Lagger	Trades Assistant
Enterprise Agreement	$58.88	$58.88	$56.88	$56.88	$52.88
Modern Award	$50.57	$50.04	$48.17	$47.21	$47.21
Difference	+$8.31	+$8.84	+$8.71	+$9.67	+$5.67

KAEFER also notes that casual employees who work 58 hours per week will be significantly better off under the enterprise agreement than they would be under the modern award (see cells AD46 to AH46 in the attached spreadsheet).

Given the above, KAEFER submits that casual employees who are engaged in regular overtime will be better off under the enterprise agreement than they would be under the modern award despite the fact that they do not receive a casual loading in addition to overtime penalties.

Second Concern – Shift Loading Percentages:

Although the shift loading percentage under the enterprise agreement (30%) is less than the shift loading percentage under the modern award (50%), part-time employees who work night and/or afternoon shifts (or a combination of both) will be better off under the enterprise agreement than they would be under the modern award because the base rate of pay under the enterprise agreement is significantly higher than the base rate of pay under the modern award.  In particular, when the applicable shift loadings are applied to the applicable base rates of pay, the hourly rate of pay that part-time employees will receive under the enterprise agreement for shift work is between 12.39% and 17.48% higher than the hourly rate of pay part-time employees will receive under the modern award for shift work.  In particular:

Night shift – part-time employees	Sheet Metal Worker	Painter	Advanced Scaffolder	Cryogenic Lagger	Trades Assistant
Enterprise Agreement (30%)	$38.27	$38.27	$36.97	$36.97	$35.37
Modern Award (50%)	$33.72	$33.36	$32.12	$31.47	$31.47
Difference	+13.49%	+14.72%	+15.10%	+17.48%	+12.39%

The same is the case for casual employees.  When the applicable shift loadings are applied to the applicable rates of pay, the hourly rate of pay that casual employees will receive under the enterprise agreement for shift work is between 15.01% and 20.04% higher than the hourly rate of pay casual employees will receive under the modern award for shift work.  In particular:

Night shift – casual employees	Sheet Metal Worker	Painter	Advanced Scaffolder	Cryogenic Lagger	Trades Assistant
Enterprise Agreement (30%)	$45.52	$45.52	$44.08	$44.08	$42.23
Modern Award (50%)	$39.23	$38.87	$37.47	$36.72	$36.72
Difference	+16.03%	+17.11%	+17.64%	+20.04%	+15.01%

Given the above, KAEFER submits that part-time and casual employees who work night and/or afternoon shifts (or a combination of both) will be better off under the enterprise agreement than they would be under the modern award despite the fact that the applicable shift loading under the enterprise agreement (30%) is less than the shift loading under the modern award (50%).

Conclusion:

For the above reasons, KAEFER submits that Commissioner Johns can be satisfied that the relevant employees are better off under the enterprise agreement than they would be under the modern award. 

If, however, Commissioner Johns still has concerns about these matters, KAEFER would be willing to provide further undertakings.”

[4] Having considered the submissions and re-reviewed the BOOT analysis I am satisfied the Agreement will pass the BOOT if approved.

[5] Subject to the undertakings referred to above, I am satisfied that each of the requirements of ss.186, 187, 188 and 190 as are relevant to this application for approval have been met.

[6] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 8 May 2019. The nominal expiry date of the Agreement is 30 April 2023.

COMMISSIONER

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Annexure A