Kitja Services Pty Ltd

[2024] FWCA 3642

[2024] FWCA 3642

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

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

Kitja Services Pty Ltd

(AG2024/3521)

KITJA SERVICES ENTERPRISE AGREEMENT NSW AND QLD 2024

Scaffolding services contractor industry
DEPUTY PRESIDENT WRIGHT	SYDNEY, 18 OCTOBER 2024

Application for approval of the Kitja Services Enterprise Agreement NSW and QLD 2024

Introduction

1. Kitja Services Pty Ltd (the Employer) has made an application for approval of an enterprise agreement known as the Kitja Services Enterprise Agreement NSW and QLD 2024 (the Agreement) pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single enterprise agreement.

1. The Agreement will apply to employees who are covered by the Building and Construction General On-site Award 2020 (the Award).

Casual Employees Entitled to Vote

1. The Commission identified that eight employees are covered by the Agreement and that they are all engaged on a casual basis. The Employer provided submissions that all of the casual employees requested to approve the Agreement by voting for it were employed at the relevant time and entitled to vote. I am satisfied that in light of the Full Bench decision in Appeal by Kmart Australia Limited t/a Kmart and others [2019] FWCFB 7599,[1] the requirement in s. 181(1) of the Act has been met.

Sufficient Interest and Sufficiently Representative

1. As noted above, eight employees are covered by the Agreement. However, there are a significant number of classifications as the Award is incorporated and the Agreement provides that employees may work under any classification provided by the Award. This may raise concerns regarding whether the employees entitled to vote on the Agreement have a sufficient interest in the terms of the Agreement and are sufficiently representative, having regard to the employees the Agreement is expressed to cover.

2. The Employer provided submissions that the eight employees covered by the Agreement fall within classifications CW1 to CW4. While no employees are presently employed in classifications CW5 to CW9, the Employer submitted that the Agreement should retain the full range of classification levels to ensure the Employer can remain agile and respond to future business changes or requirements. Further the full range of classification levels ensures employees are provided the opportunity for advancement into higher classification levels as their skills develop while remaining employed under the Agreement. In conclusion, the Employer submitted it is important to the ongoing competitiveness of its business and its ability to offer career progression and new employment opportunities to retain coverage of the full range of classification levels in its Agreement.

1. Based on these submissions, I am satisfied that the employees requested to approve the Agreement by voting for it have a sufficient interest in the terms of the Agreement and are sufficiently representative pursuant to s.188(2) of the Act and paragraph 17 of the Statement of Principles (SoP).

Better off Overall Test (BOOT) Issues

1. The Commission raised the following issues with the Employer which are relevant to whether employees are better off overall under the Agreement compared to the Award:

(a)Appendix 1 of the Agreement appears to provide that it is the intention of the Employer to incorporate the Award into the Agreement. The Agreement is silent as to all entitlements provided by the Award, including but not limited to the Workplace delegates’ rights term, penalties, overtime, span of hours and allowances.

(b)Appendix 1 of the Agreement provides for loaded rates, called ‘Total Hourly Rate of Pay’. It provides that the ‘Base Hourly Rate of Pay for all ordinary and additional hours worked (and any applicable allowances, overtime payments, penalty payments and loadings payable under the Award) may be given by payment of a higher composite Total Hourly Rate of Pay over a given period.’ As the Agreement does not contain these rates of pay, it is not possible to determine if employees can be considered better off overall. Further to this, as the entire workforce comprises of casual employees, it appears to be the intention of the Employer to pay casual employees at a loaded rate which presents further BOOT concerns in light of Loaded Rates in Agreements [2018] FWCFB 3610.[2]

Section 190 Undertakings

1. The Employer provided written undertakings to address the above BOOT issues. These undertakings include that the Award is incorporated, and that the Employer will not apply a ‘Total Hourly Rate of Pay’ or other form of loaded rate or annualised salary to employees covered by the Agreement.

1. A copy of the undertakings is attached in Appendix 2. 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. The undertakings are taken to be a term of the Agreement.

Section 186, 187, 188 and 190

1. 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.

Approval

1. The Agreement is approved and, in accordance with s.54 of the Act, will operate from 25 October 2024. The nominal expiry date of the Agreement is 18 October 2028.

DEPUTY PRESIDENT

[1] [2019] FWCFB 7599.

[2] [2018] FWCFB 3610.

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