Lindsay Brothers Management Pty Ltd T/A Lindsay Transport

[2021] FWCA 6307

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Lindsay Brothers Management Pty Ltd T/A Lindsay Transport
(AG2021/5744)

LINDSAY TRANSPORT ENTERPRISE AGREEMENT 2021

Road transport industry
COMMISSIONER SIMPSON	BRISBANE, 15 OCTOBER 2021

Application for approval of the Lindsay Transport Enterprise Agreement 2021

[1] An application has been made for approval of an enterprise agreement known as the Lindsay Transport Enterprise Agreement 2021 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by Lindsay Brothers Management Pty Ltd T/A Lindsay Transport (the Applicant).

[2] The Agreement is a single enterprise agreement.

[3] On 7 July 2021 my Chambers sent correspondence to the Applicant outlining a number of preliminary concerns with the application and inviting responses to those concerns by 12 July 2021. The Applicant requested an extension until 15 July to file responses which was granted.

[4] The Transport Workers’ Union (TWU/the Union) was also invited to file a Form F18.

[5] On 14 July the TWU filed a Form F18 objecting to the approval of the Agreement and outlining a number of concerns. The TWU submitted that the Agreement fails to meet the Better Off Overall Test (BOOT). The TWU accepted that undertakings may resolve its BOOT concerns.

[6] Additionally, the TWU submitted the Agreement has been signed by an employee who, according to its records, only attended one meeting on 5 May 2021 of a negotiation process that took approximately 12 months. The TWU said the Employee who signed the Agreement was not an Individual Bargaining Representative.

[7] The TWU submitted the Applicant conducted negotiations with the TWU and members of the Linehaul Driver Committee. The TWU submitted the Applicant confirmed to the TWU at the outset of negotiations that none of the Linehaul Driver Committee members had been appointed as bargaining representatives by employees. The TWU submitted this fact is evidenced by the absence of any Form 18A being filed.

[8] The relevant Awards for the purposes of the BOOT include the Road Transport (Long Distance Operations) Award 2020 (RTLDO Award) and the Road Transport and Distribution Award 2020 (RTD Award).

[9] The TWU outlined its initial BOOT concerns as follows:

EA Clause	Details of Concern
11	Provides for temporary employment which is not a feature in either of the Road Transport Awards
23	Redundancy: Appears to be less beneficial than the provisions of the NES
29	No Industrial Action: The terms of the agreement appear to restrict the employees’ right to take protected action while this agreement applies. This could be rectified by an undertaking that the clause relates to unprotected industrial action.
SCHEDULE 1: Linehaul Drivers
3.8	A part-time employee’s ordinary hours of work will be 7.6 hrs per day. The RT(LDO) prescribes a minimum payment for 500kms per day for employees paid by cpk method.
3.12	This provision is less beneficial than the Award which provides for a minimum payment for 8 hours or 500kms for casual employees.
3.13	The casual conversion provision in the agreement are less beneficial than the provisions in the RT(LDO) Award in that it contains a list of reasonable grounds for refusal that are not contemplated by the Award.
4.1.2	This clause establishes a hybrid of ordinary hours and kilometres travelled. The Award provides for 38 ordinary hours per week. The Award also provides a formula for determining daily kilometres which is based on a driver travelling 75 kms per hour. The Award is also based on 40 hours per week with a rostered day off each month which is not a feature of the EA. This hybrid determination of ordinary hours is extremely confusing, appears to be less beneficial than the requirements of clause 16.3 of the Award and results in complexity that is not understood by a majority of drivers.
16.3	The provisions of this clause are less beneficial than the Award provision and could nullify an employee’s entitlement to payment.
SCHEDULE 2: Depot Employees
3.2(f)	This could result in BOOT failure as the overtime rates in the EA are payable at percentages that are less beneficial than the Award prescription of 150% for the first two hours and 200% thereafter.
5.2	Overtime rates are less than Award.

5.4(a)	The effect of this provision is that an employee will be paid a lesser rate for overtime worked on a Sunday compared to the rate payable for the first 7.6 hours.
6.3	Shift allowances are less beneficial than Award shift allowances.
7.2	Prescribes that meal breaks will be unpaid. The Award provides for payment of a 20 minute break for shiftworkers. This provision is less beneficial.
9.1	The rates applicable in Victoria, Queensland and South Australia prescribe rates which are below Award rates for all grades paid overtime rate one; all grades at overtime rate two and all grades for casual overtime rate two with the exception of the Melbourne B-Double driver who is only disadvantaged with respect to overtime rate two.
9.5	Higher Duties: The requirement to work the majority of hours at the higher classification is less beneficial than the provisions of the RT&D Award clause 17.4 requirement of two hours or more.
9.6	The Leading Hand Allowance has fallen below the current Award allowance.
13	Call back or recall to duty provisions do not clearly specify what the “applicable overtime rate” is. This could be below the Award entitlement, especially in Vic, SA and/or Qld.

[10] On 15 July the Applicant filed its responses to the concerns raised by the Fair Work Commission (the Commission).

[11] On 29 July the matter was listed for Hearing. Ms Melissa Strong appeared for the Applicant and Ms Therese Walton appeared for the TWU.

[12] During the hearing the TWU indicated that concerns regarding “process” had been addressed by the Applicant’s submissions however the TWU had ongoing concerns regarding remuneration under the Agreement. The TWU accepted that the NES clause in the Agreement would normally be sufficient to address inconsistencies between certain clauses in the Agreement and NES entitlements however more specific undertakings would ensure employees understood their entitlements under the Agreement.

[13] The TWU said it also maintained that the clause in relation to the entitlement for an additional week’s annual leave for shift workers was too prescriptive.

[14] Directions were issued for the TWU to file further submissions by 3 August 2021, and for the Applicant to file anything in response by 10 August 2021.

[15] Prior to turning to what the TWU described as unresolved issues I confirm I am satisfied that the requirements of Regulation 2.06A of the FW Regulation as it pertains to the signing of the Agreement have been met as the relevant employee is a member of Lindsay Transport’s Linehaul Driver Committee and was appointed as an Individual Bargaining Representative.

[16] The TWU submitted a list of issues in its submissions filed on 4 August following the hearing on 29 July 2021, that it said were remaining unresolved concerns. The TWU said it relied on its submissions of 4 August and those issues identified in its Form 18. I will set out where necessary the issues and the responses provided by the Applicant.

[17] The Applicant submitted that in both its 15 July and 10 August submissions that the calculations it has provided intentionally compare the Agreement with the RTLDO Award and the RTD Award and the rates of pay contained within those Awards, as they apply after the annual review effective 1 July 2021. The Applicant noted that the rates of pay in the Awards after 1 July 2021 are 2.5% higher than the rates of pay which applied when the employees voted on the Agreement and when the Agreement was lodged with the FWC on 23 June 2021.

Temporary Employment

[18] The TWU submitted that Clause 11 of the Agreement provides for temporary employment which is not a feature in either of the Road Transport Awards. The TWU sought an undertaking that the clause will not apply.

[19] The Applicant submitted that it does not agree that this issue is a valid BOOT concern.

It submitted that fixed term employment is not new to Lindsay Transport’s workforce and is a feature of the 2015 Agreement.

[20] The Applicant submitted that it has bargained for fixed term employment in the Agreement to enable Lindsay Transport to continue to engage employees to perform work for a fixed period or project and having this type of engagement gives Lindsay Transport workforce planning flexibility while still prioritising security of employment for its employees. The Applicant submitted that the TWU’s objection would have the undesirable consequence of Lindsay Transport having to rely more heavily on external labour hire or employing more casuals, who do not benefit from the same security of employment or paid leave entitlements.

[21] Ultimately this is one factor that the Commission needs to take into account in making an assessment as to whether the Agreement satisfies the BOOT.

Annual Leave Clause

[22] The TWU submitted that Clause 20.1 of the Agreement provides for 20 days of annual leave per year, whereas the NES entitlement is four weeks. I am satisfied the NES Precedence Clause in the Agreement resolves this issue.

Entitlement to Additional Weeks Annual Leave for shift workers

[23] The TWU submitted that Clause 20.13 of the Agreement sets a more onerous qualification for shiftworkers to gain entitlement to an additional week of annual leave. The TWU submitted that whilst this will not have an impact upon linehaul drivers, it will likely restrict such entitlement for local drivers and warehouse employees. The TWU proposed an undertaking removing the more onerous 44 Sunday provision and replacing it with the NES provision of regularly rostered to work Sundays and public holidays.

[24] The Applicant referred to Clause 24.3 of the RTD Award that states:

“A shiftworker, for the purposes of the additional week’s leave referred to in section 87(1)(b) of the Act, is a 7 day shiftworker who is regularly rostered to work on Sundays and public holidays”

[25] The Applicant submitted that the RTD Award does not define what ‘7 day shiftworker’ nor ‘regularly rostered’ means. The Applicant submitted that the entitlement to an extra week of annual leave set out in the RTD Award applies to seven day shift workers.

[26] The Applicant submitted that it does not roster staff as ‘seven day shift workers’. Whilst Lindsay Transport operates seven days per week, rosters are typically fixed in nature to cover a fixed roster over five days. For example, Lindsay Transport rosters staff to work either Tuesday to Saturday or Sunday to Thursday to cover the seven days of the week. In some cases, employees also work a sixth day as required; such work is treated as overtime.

[27] The Applicant submitted that no employees are rostered to work a fixed or rolling seven day continuous roster, and as such it submitted that it does not employ ‘seven day shift workers’ as contemplated by the RTD Award or the FW Act.

[28] The Applicant submitted that despite this, and to enable the Applicant’s employees who do perform shiftwork and who work Sundays and public holidays to be eligible for an extra week of annual leave, clause 20.13 of the Agreement defines who is to be considered a ‘seven day shift worker’ for the purposes of the NES and hence entitled to an additional five days of annual leave.

[29] The Applicant submitted that this entitlement does not exist in the RTD Award and is a benefit under the Agreement over and above the requirements of the RTD Award. The definition provides certainty in the absence of any in the RTD Award. As such, this provision is not less beneficial than the annual leave provisions set out in the RTD Award.

[30] The Applicant offered an undertaking it said in order to resolve any residual concerns of the FWC on this issue. The undertaking offered was as follows:

“Clause 20.13 of the Agreement will apply as if it read, For the purposes of the additional week of leave, a Seven Day Shift Worker is a Depot Employee who does Shift Work as defined in clause 6.1(b) of Schedule 2, and who works a minimum of 44 Sundays and 4 Public Holidays per annum, assessed quarterly.””

[31] I am satisfied this proposed undertaking resolves the concern raised by the Union.

Carers Leave, Redundancy and Abandonment of Employment

[32] The TWU submitted that Clause 19.7(d) sets out the carer’s leave provisions and is more onerous with respect to evidentiary requirements than provided at s.107(3) of the Act. The TWU submitted that Clause 22.4 provides that an employee who has failed to attend for work or notify the employer for three consecutive days will be deemed to have abandoned his/her employment and will be terminated without notice. The TWU submitted that this clause fails to meet the NES standard regarding notice provisions, and Clause 23.2 is inconsistent with s.120 of the Act in that it reduces the obligations of the employer for redundancy payment.

[33] I am satisfied that the NES Precedence Clause in the Agreement resolves these issues.

Industrial Action

[34] The TWU submitted that Clause 29 of the Agreement, appear to restrict the employees’ right to take protected action while this agreement applies which could be after the nominal expiry date.

[35] The Applicant submitted that the intended effect of clause 29 to be that no industrial action should be taken prior to the nominal expiry date of the Agreement, consistent with section 417 of the FW Act. The Applicant submitted that if this explanation does not address the FWC’s concern regarding this issue, Lindsay Transport is prepared to provide the following undertaking:

“Clause 29 of the Agreement will apply as if it read, “Employees agree that they will not engage in any form of industrial action up to and including the nominal expiry date of this Agreement.””

[36] I am satisfied that the undertaking offered will resolve the concern raised by the TWU.

Part Time Employment

[37] The TWU submitted that the Applicant has said that there is only one part-time employee working in NSW who, because of the higher hourly rates payable, will not suffer a disadvantage pursuant to the Agreement. The TWU submitted that this response fails to address the fact that this agreement provides for part-time employment at all locations operated by the Applicant and the potential for underpayment in other States remains and therefore this provision fails the BOOT.

[38] The Applicant disputed the TWU’s submission. It submitted that notwithstanding the one part-time employee currently employed in New South Wales, the Applicant understands the need to consider the potential for other part-time employees to be employed under the Agreement in other states.

[39] The Applicant referred to the modelling in its 15 July Submissions to show that employees are better off overall under the Agreement relative to the respective Awards and specifically, Attachment 6 to the Applicant’s 15 July Submission including the modelling done to cover potential part-time employees.

Schedule 1 – Linehaul Drivers

[40] The TWU submitted that Clause 3.8 provides that a part-time employee’s ordinary hours of work will be 7.6 hrs per day however the RT(LDO) prescribes a minimum payment for 500kms per day for employees paid by the cents per kilometre (“CPK”) method.

[41] The Applicant responded that it understood that two separate issues are raised here:

(a) Ordinary hours of work for part-time employees being 7.6 hours under the Agreement; and

(b) The requirement for a minimum payment for 500kms per day for employees paid by the c/km method under the RTLDO Award.

[42] The Applicant rejected the TWU submission for the following reasons.

[43] In relation to the ordinary hours of work for part-time employees, clause 10.9 of the RTLDO Award states:

“A part-time employee’s ordinary hours of work will be 8 hours per day, unless the employer and employee agree in writing upon a greater number”

[44] Schedule 1 clause 3.8 of the Agreement states:

“A part-time LH Employee’s ordinary hours of work will be 7.6 hours per day, unless LT and the employee agree in writing upon a greater number”

[45] The Applicant submitted that Clause 3.8 of the Agreement constitutes an agreement in writing with employees that their ordinary hours of work will be 7.6 hours per day and the Agreement provides for fewer ordinary hours per day than the RTLDO Award.

[46] In relation to the issue of minimum payment for 500kms per day the Applicant submitted that relevantly, clause 10.8 of the RTLDO Award states:

“A part-time employee who is paid by the cents per kilometre method of clause 16.4 must receive a minimum payment per day for 500km. Where the employee is engaged according to the hourly driving rate method the minimum payment per day must be 8 hours’ pay”

[47] The Applicant submitted that Schedule 1 at clause 3.7 states that the minimum daily payment to a part-time LH Employee under the Agreement is equivalent to the amount payable for the following ‘base daily kilometres’:

(a) Single drivers: 530kms

(b) B Double drivers: 503 kms

[48] The Applicant submitted that it accepts that the 460 ‘base daily kilometres’ for Road Train drivers is less than 500km per day when considered in isolation to the rest of the Agreement. However, part-time Road Train drivers will be paid significantly higher cents per kilometre rate in comparison to the rates under the RTLDO Award (RTLDO Award rate is $0.4808/km; Agreement rate is $0.5333/km).

[49] In relation to the ordinary hours of work for part-time linehaul drivers and the minimum daily kilometres, the Applicant provided an attachment with its submissions giving specific examples of how the Agreement for each classification of permanent part-time drivers satisfies the BOOT.

[50] The TWU submitted that Clause 3.12 provides that casual employees’ ordinary hours of work will be 7.6 hrs per day however this provision is less beneficial than the Award which provides for a minimum payment for 8 hours or 500kms per day for casual employees.

[51] In response the Applicant submitted that clause 11.4(a) of the RTLDO Award states:

“A casual employee who is paid by the cents per kilometre method of clause 16.4 must receive a minimum payment per engagement for 500km”

[52] The Applicant submitted that Schedule 1 clause 3.12 of the Agreement states that the minimum payment to a casual LH Employee under the Agreement is equivalent to the amount payable for the following ‘base daily kilometres’ :

(a) Single drivers: 530kms

(b) B Double drivers: 503 kms

[53] The Applicant submitted that while it accepts that the 460 ‘base daily kilometres’ for Road Train drivers is less than 500km per day under the Award, casual Road Train drivers will be paid significantly higher cents per kilometre rate in comparison to the rates under the RTLDO Award (RTLDO Award rate is $0.5530/km; Agreement rate is $0.6399/km).

[54] The Applicant relied on BOOT modelling it provided as an attachment to its 15 July Submissions which provides specific examples of how the above minimum daily base kilometres for each classification of casual drivers meets the BOOT compared to the RTLDO Award.

[55] The TWU submitted that Clause 3.13 sets out the casual conversion provisions, and the casual conversion provisions in the agreement are less beneficial than the provisions in the RT(LDO) Award in that it contains a list of reasonable grounds for refusal that are not contemplated by the Award.

[56] The Applicant agreed with the TWU’s submission that Schedule 1 clause 3.13 contains a list of reasonable grounds for refusal of casual conversion to either part-time or full-time employment, however, the Applicant submitted that the provisions are not less beneficial than the RTLDO Award. Further or in the alternative, if the non-exhaustive list of reasonable grounds is less beneficial than the RTLDO Award, the Applicant submitted when considered overall the Agreement still passes the BOOT.

[57] The Applicant referred to clause 11.5(f) of the RTLDO Award which states:

“Where a regular casual employee seeks to convert to full-time or part-time employment, the employer may agree to or refuse the request, but the request may only be refused on reasonable grounds and after there has been consultation with the employee”

[58] Schedule 1 clause 3.13 in the Agreement states:

“A casual LH Employee shall be entitled to conversion in accordance with the relevant casual conversion provisions in the RTLDO Award and the NES. Reasonable grounds for refusal of a request for casual conversion, or not to make an offer under the NES for a casual Employee to convert include:

(a) Linehaul work is variable and conversion would not afford LT the flexibility to balance freight volumes (and therefore linehaul trips) with availability of LH Employees to work;

(b) Converting LH Employees may interfere with LT’s ability to manage its other LH Employees to comply with fatigue management requirements;

[59] The Applicant submitted that road linehaul activity, by its nature, is dependent on volumes, which fluctuate from day-to-day and week-to-week due to various factors, including customer demand and seasonality of produce. It submitted volumes cannot be predicted ahead of time with precision. Despite the daily fluctuations of volumes, the Applicant and its drivers must meet the requirements of national driver fatigue laws.

[60] The Applicant submitted that the unpredictability of linehaul volumes inevitably makes it difficult to manage each driver’s hours to provide a full-time workload consistent with the national driver fatigue laws. Casual drivers are used to fill the gaps in the linehaul requirements to ensure that fatigue laws are complied with by Lindsay Transport, its employees and its customers. The Applicant submitted having a suitably qualified and professional pool of casual drivers is critical to meet business needs and comply with these laws.

[61] The Applicant submitted that for that reason, it may not be reasonable in every instance for the business to convert a casual linehaul driver to either a part-time or full-time position.

[62] The Applicant submitted that the list of reasonable grounds for refusal of casual conversion included in Schedule 1 clause 3.13 is not an exhaustive list. The Applicant submitted that it believes that it is important to be clear with employees about how conversion operates and the circumstances in which the business may determine that conversion is not reasonable. The Applicant has therefore set out very clear examples of those limitations in the Agreement for employees to see.

[63] This is an issue that the Commission is required to weigh in reaching its final assessment in relation to the BOOT.

Hybrid of Ordinary hours and kilometres travelled

[64] The TWU submitted that Schedule 1 clause 4.1.2 of the Agreement establishes a hybrid of ordinary hours and kilometres travelled which is different to the RTLDO Award, confusing and less beneficial than the requirements of clause 16.3 of the RTLDO Award.

[65] The Applicant submitted in response that the RTLDO Award, the Agreement and the 2015 Agreement all provide for the same payment structure for drivers, and all provide for an average of 38 ordinary hours and allow payment by cents per kilometre with guaranteed minimum payments.

[66] The Applicant submitted that the payment structure under the Agreement is no different to the payment structure under the 2015 Agreement. It provides for linehaul drivers to be paid by cents per kilometres and provides a minimum weekly retainer (or daily minimum engagement for casuals), specifying the same number of kilometres that each driver classification must complete to earn the retainer or minimum casual engagement.

[67] The Applicant submitted that Clause 13.1 of the RTLDO provides for an average of 38 ordinary hours per week averaged over not more than 28 days, and similarly, Schedule 1 clause 4.1.1 of the Agreement states that ordinary hours of work will be a maximum of 38 per week averaged over a period not in excess of 28 days.

[68] The Applicant submitted that Schedule 1 clause 4.1.2 of the Agreement states that, subject to maximum of 38 hours per week set out in clause 4.1.1, the ordinary hours for leading hand employees are the number of hours required to complete the weekly base kilometres for each driver’s classification as set out in Schedule 1 clause 5.

Formula for determining daily kilometres

[69] The TWU submitted that the RTLDO Award provides a formula for determining daily kilometres which is based on a driver travelling 75 kms per hour, is based on 40 hours per week and includes a rostered day off each month, none of which is included in the Agreement.

[70] The Applicant rejected the submission that the RTLDO includes a formula for determining daily kilometres which is based on a driver travelling 75 kms per hour. The Applicant submitted if that was the case, an 8-hour day would require 600 daily kilometres which is inconsistent with the 500 minimum daily kilometres required for part-time and casual employees under the RTLDO Award.

[71] The Applicant submitted that the TWU appears to ignore the fact that both the cents per kilometre and minimum driving hourly rates contained within the RTLDO Award include an uplift factor of 1.2 at clause 16.5(b) to compensate for overtime as defined in clause 18.2(b) of the RTLDO Award. The Applicant submitted that the TWU appears not to take into account the fact that employees’ ordinary hours are 7.6 under the Agreement, not 8 as prescribed by the Award.

Requirements of clause 16.3 of the RTLDO Award

[72] The Applicant submitted that clause 16.3 of the RTLDO Award sets out the requirements for rates of pay to linehaul drivers covered by that Award. Clause 16.3(a) states that the employer must nominate whether the employee is paid by cents per kilometre method or the hourly rate method. The Applicant submitted that its driving rates are higher than the minimum driving rates set out in the RTLDO Award.

[73] The Applicant submitted that clause 16.3(e) of the RTLDO states that, in addition to the minimum driving rate, a long-distance driver must be paid for loading and unloading allowances, travelling allowances and any other allowances required to be paid by the Award. The Applicant referred to its Form F17 Declaration and 15 July Submission and Attachment 8 which explain how both the travelling allowance and loading and unloading allowances are paid under the Agreement.

[74] The Applicant relied on the details set out in the F17 and July Submission to demonstrate how linehaul drivers are better off overall under the Agreement compared to the RTLDO Award including details of various benefits that are included in the Agreement which either exceed the minimum requirements of the RTLDO Award or are not available under the RTLDO Award, including:

(a) higher rates of minimum pay which flow into other entitlements such as annual leave, annual leave loading, sick leave, parental and carer’s leave, long service leave, public holiday pay; plus

(b) the existence of additional benefits such as Lindsay Transport’s Safety & Compliance bonus set out in Schedule 1 clause 6 and the extra week of annual leave available for linehaul drivers under clauses 20.16 and 20.17 of the Agreement.

Guaranteed Minimum Payment

[75] The Applicant responded to an issue raised by the Commission in relation to the “weekly minimum retainer” set out in clause 5 of Schedule 1 of the Agreement.

[76] The Applicant submitted that Linehaul work, by its nature, is dependent on volumes, which fluctuate from day-to-day and week-to-week due to various factors, including seasonality of produce, and having a pool of drivers available to perform the work is important to the business, and the Agreement is drafted to reflect this.

[77] The Applicant said that the minimum weekly retainer is designed to ensure that a pool of drivers is available at any stage, and drivers who have not reached the weekly base kilometres (e.g. because volumes are light) are entitled to be paid the full minimum weekly retainer, provided that the driver is ready, willing and able to perform the weekly base kilometres.

[78] The Applicant said the minimum weekly retainer in clause 5 of Schedule 1 of the Agreement operates in a similar fashion to the Guaranteed Minimum Payment set out in clause 16 of the RTLDO Award. Consistent with the RTLDO Award, the minimum weekly retainer under the Agreement is not dependent on the completion of a prescribed number of base weekly kilometres. Clause 5.4 of Schedule 1 of the Agreement states that:

“Payment of the minimum weekly retainer will be dependent upon the full-time or part-time LH Employee being ready, willing and able to perform their weekly base kilometres during the relevant weekly period”

[79] Further, clause 5.5 of Schedule 1 of the Agreement states:

“If a full-time or part-time LH Employees does not reach their minimum weekly base kilometers they will be paid as follows:

(a) provided that they were ready, willing and available to perform such work as LT required, they will be paid the minimum weekly retainer; or

(b) where the reason for their failure to reach their minimum weekly base kilometres was for a reason other than LT not allocating work to them, they will be paid for the actual number of kilometres travelled at the rates specified in clause 5.6.”

[80] The Applicant submitted that the reference in clause 5.5(b) of Schedule 1 of the Agreement to the reason for failure being for a reason other than Lindsay Transport not allocating work to the employee is intended to describe circumstances where the employee has failed to reach their minimum weekly base kilometres because they were not ready, willing and available to perform such work.

[81] The Applicant advised it was prepared to provide the following undertaking to address the issue raised:

“The words ‘where the reason for their failure to reach their minimum weekly base kilometres was for a reason other than LT not allocating work to them …’ in clause 5.5(b) of Schedule 1 of the Agreement shall be replaced with ‘where the reason for their failure to reach their minimum weekly base kilometres was because the employee was not ready, willing and able to work…’”

[82] The undertaking offered resolves this concern.

Schedule 2 – Depot Employees

Overtime

[83] The TWU submitted that Schedule 2 Clause 5.4(a) deals with overtime. The effect of this provision is that an employee will be paid a lesser rate for overtime worked on a Sunday compared to the rate payable for the first 7.6 hours. Pursuant to the NES overtime work on a Sunday fails to meet the reasonableness test.

[84] The Applicant agreed that Depot Employees rostered to work ordinary hours on a Sunday and who also work overtime after performing their ordinary hours will receive a lower rate of pay per hour for the overtime worked relative to the rate of pay for their ordinary hours. All time worked on Sundays by all other Depot Employees receives the same rate of pay.

[85] The Applicant relied on its July Submissions and Attachments 5, 6 and 7 to those submissions in relation to its ordinary and overtime rates of pay relative to the RTD Award, providing various examples where hours worked are ordinary time and/or overtime and stands by that submission relative to any residual BOOT concerns.

Meal Breaks

[86] The TWU submitted that clause 7.2 prescribes that meal breaks will be unpaid, however the Award provides for payment of a 20 minute break for shiftworkers, and this provision is less beneficial than the Award.

[87] The Applicant agreed that the Agreement does not provide a paid 20-minute meal break for shift workers while working on day, afternoon or nightshift. The Applicant notes that the minimum rates of pay set out in Schedule 2 clause 9 of the Agreement are all higher than the minimum rates of pay set out in the RTD Award. The Applicant submitted those minimum rates of pay flow into higher annual leave, annual leave loading, sick leave, long service leave, personal and carer’s leave and superannuation. The Agreement also includes freezer and chiller allowances, sugar season bonuses and other benefits, and all of these higher and additional benefits result in Depot Employees (including shift workers) being better off overall compared to the RTD Award.

Overtime Rates of Pay

[88] The TWU submitted that clause 9.1 sets out rates of pay. The TWU submitted that the rates applicable in Victoria, Queensland and South Australia prescribe rates which are below current Award rates for all grades paid overtime rate one; all grades at overtime rate two and all grades for casual overtime rate two with the exception of the Melbourne B-Double driver who is only

disadvantaged with respect to overtime rate two.

[89] The Applicant submitted the TWU’s expressed concern does not make sense and was not clarified nor corrected in the TWU’s 4 August Submission. The Applicant submitted the TWU submission was inaccurate and the Applicant provided a table setting out a summary of the overtime rates payable for Queensland, Victoria and South Australia employees under the Agreement.

[90] The Applicant submitted that the table shows, contrary to the TWU’s claims, that the overtime rates are higher than the RTD Award for the following employees:

(a) OT1 for Melbourne B Double drivers; and

(b) All grades for casuals paid OT2, including Melbourne B Double drivers.

[91] The Applicant accepted that overtime rates in the Agreement for some permanent Depot Employees in Queensland, Victoria and South Australia are lower than the applicable rates under the RTD Award for the other cohorts of employees, including:

(a) all grades paid OT1, except Melbourne B Double drivers; and

(b) all grades paid OT2.

[92] The Applicant submitted that notwithstanding the overtime rates in the Agreement being lower than the applicable rates in the RTD Award for some Depot Employees, the Depot Employees remain better off overall under the Agreement than the RTD Award. The Applicant relied on its 15 July Submission and attachments 5, 6 and 7 in relation to overtime rates (including BOOT modelling) and stood by that submission.

Higher Duties

[93] The TWU submitted that clause 9.5 deals with higher duties, and the requirement to work the majority of hours at the higher classification is less beneficial than the provisions of the RT&D Award clause 17.4 requirement of two hours or more.

[94] The Applicant submitted that clause 17.4 of the RTD Award provides that where an employee is required to perform two or more grades on any one day, the employee is to be paid the minimum rate for the highest grade for the whole day.

[95] The Applicant accepted that the RTD Award does not require a Depot Employee to perform the higher grade for the majority of the shift to be eligible for the higher grade wage however, it does not agree that the RTD Award requires two hours or more for higher duties to be paid.

[96] The Applicant submitted that it is prepared to provide the following undertaking:

“That Schedule 2 clause 9.5 be replaced with ‘where a Depot Employee is required to perform 2 or more grades of work on any one day, the Depot Employee is to be paid the minimum rate for the highest grade for the whole day’”

[97] I am satisfied that the undertaking offered resolves this issue.

Leading Hand Allowance

[98] The TWU submitted that clause 9.6, Leading Hand Allowance, has fallen below the current Award allowance.

[99] The Applicant submitted that the TWU is correct that, as at August 2021, the leading hand allowance for Depot Employees under the Agreement is slightly less than the current leading had allowance in the RTD Award however, this is not a BOOT issue.

[100] The Applicant submitted that at the time of drafting the Agreement, the Annual Wage Review decision had not yet been announced and the new allowances under the RTD Award for post1 July 2021 were not available. The pre1 July 2021 RTD Award rates of leading hand allowances were the applicable comparison rates at that time and were included in the Agreement for employees to vote on. Further the Agreement at clause 13.2 allows for the allowance to increase over the life of the Agreement.

[101] The Applicant submitted that the BOOT is applied as at the ‘test time’ which is when the application for approval of the agreement is lodged with the FWC, and the application was lodged the application for approval on 23 June 2021 and the test time is therefore prior to the increase in the leading hand rates under the RTD Award.

Call-Back

[102] The TWU submitted that clause 13 sets out the call-back provisions and the Call back or recall to duty provisions do not clearly specify what the “applicable overtime rate” is, and this could be below the Award entitlement, especially in Victoria, South Australia and/or Queensland.

[103] The Applicant submitted that Schedule 2 clause 13 of the Agreement states:

“Where a Depot Employee has left the depot and is recalled to perform duty, after completion of his/her rostered hours, or during time off, he/she shall be paid for a minimum of four hours’ work at the applicable overtime rate whether or not the hours are worked”

[104] The Applicant submitted that Schedule 2 clause 4.5 of the Agreement states:

“All time worked outside the ordinary hours of work prescribed by clause 4 will be overtime and paid in accordance with clause 5 of this Schedule. A Depot Employee may be required to perform a reasonable amount of overtime”

[105] The Applicant submitted that the ‘applicable overtime rate’ is clearly set out in the Agreement in relation to this issue however if the Commission is not satisfied that this explanation addresses the TWU’s concern regarding this issue, the Applicant is prepared to provide the following undertaking:

“The words ‘set out in clause 5 of this Schedule’ shall be added after the words ‘applicable overtime rate’ in Schedule 2 clause 13.1 of this Agreement”

[106] The undertaking proposed by the Applicant would resolve any uncertainty over the issue.

Delays due to breakdowns and impassable highways

[107] The TWU submits the provisions of clause 16.3 of the Agreement are less beneficial than the RTLDO Award and could nullify an employee’s entitlement to payment. The Applicant submitted that it does not agree and refers to its response regarding this issue from paragraph 55 to 61 of its 15 July Submission.

[108] In its July submission the Applicant submitted that breakdowns and impassable highways occur infrequently, on approximately 10 to 15 occasions per week across more than 1.2 million kilometres driven by the Applicants drivers each week. The Applicant submitted that on average this equates to such a incident occurring less than twice per year per driver. It is even rarer for delays to occur in circumstances where a driver is eligible for a delay payment under the RTLDO Award that would not otherwise be payable under the Agreement.

[109] The Applicant noted that clause 16 of Schedule 1 of the Agreement requires that the provision will apply only where

(a) such delays occur while the employee has already commenced travel on any such long distance operation; and
(b) where the return to home base is delayed by more than 6 hours beyond the employee’s anticipated return time.

[110] The Applicant submitted that clause 15 of the RTLDO Award requires the payment to be made “where a long distance operation is delayed because of breakdowns or impassable highways”. The references in the RTLDO Award to an operation being delayed because of breakdowns and impassable highways indicates that that the long distance operation has already commenced travel and is then subsequently delayed. Clause 16 of Schedule 1 of the Agreement is therefore consistent with the RTLDO Award in that regard.

[111] The Applicant submitted that both the RTLDO Award and the Agreement require the employee to take all reasonable steps to minimize the period of delay. Linehaul drivers are subject to specific fatigue rules which require them to take breaks during each journey. One form of mitigation contemplated by the RTLDO Award is that such fatigue breaks are taken to help mitigate the impact of the delay.

[112] The Applicant submitted that in some cases, it may be possible and even more advantageous, for a driver to take a 7 hour fatigue break during such delays. This may allow the driver to be eligible for a second journey immediately on arrival and therefore, able to earn more or return earlier than expected to home base without breaching legislative fatigue rules.

[113] The Applicant submitted that it understood that the requirement to be delayed by more than 6 hours may nonetheless mean that the employee may not be better off in relation to delays under the Agreement relative to the RTLDO Award.

[114] The Applicant submitted that it pays for delays, in the vast majority of cases, in the same circumstances as would be paid under the RTLDO Award, being that it does not always rely upon the requirements set out in clause 16.3, Schedule 1 of the Agreement for the delay to occur after the journey has commenced and be more than six hours beyond the anticipated return time.

[115] The Applicant submitted that where delay payments are paid under the Agreement, the hourly rate paid is between 33% (BD drivers) to 38% (single drivers) higher than the respective hourly rate payable under clause 16.1 of the RTLDO Award. Given the reasonably small number of times that delays occur and that Lindsay Transport often compensates drivers for such delays consistently with the terms of the RTLDO Award, Lindsay Transport believes that drivers are therefore better off overall.

[116] The Applicant referred to its modelling which shows that, even if eligible for a delay payment under clause 15 of the RTLDO Award, but ineligible for a delay payment under clause 16, Schedule 1 of the Agreement for half of such delays, a driver would still be better off overall as demonstrated in attachment 8 to its July Submissions.

Shift Allowances

[117] The TWU stated that the provisions of Schedule 2 clause 6.3 of the Agreement in relation to the shift allowance rates payable are less beneficial than the RTD Award. The Applicant referred to paragraphs 36 to 40 of 15 its July Submission in relation to this issue including the BOOT modelling.

Superannuation payments

[118] The TWU submitted that whilst the F17 said the Agreement provided more beneficial superannuation entitlements the Agreement does not provide details for the calculation of superannuation entitlements for linehaul drivers. The TWU submitted that whilst there is a provision in the Agreement stating that SGC obligations will be satisfied, the employer contribution would need to be based on the ATO formula which is 2850kms x cpk x 10%. The TWU submitted that if the Applicant calculates the employer contribution on the weekly rates set out in clause 5.1 of Schedule 2 then the SGC obligation is not met.

[119] The Applicant responded that the TWU confuses two separate issues, and that superannuation payments under the Agreement are calculated differently for depot employees and linehaul employees to reflect the differences in the payment of Ordinary Time Earnings under the RTD Award compared to the RTLDO Award.

[120] The Applicant submitted that it assumed there was no objection to the statement that depot drivers received more beneficial superannuation under the Agreement given the TWU submission.

[121] The Applicant noted that the second part of the TWU’s F18 A2 at paragraph 1 objects to the fact that the Agreement does not provide details for the calculation of superannuation entitlements for linehaul drivers however this issue is not restated in the TWU’s list of unresolved concerns set out in its 4 August Submission.

[122] The Applicant submitted that clause 16 of the Agreement requires the Applicant to meet its superannuation guarantee charge obligations in accordance with its statutory obligations, and this is entirely appropriate.

[123] The Applicant submitted that for completeness it is aware there is general guidance published by the Australian Tax Office on its website for calculation of superannuation for long distance drivers, which is non-binding, and this is covered in its F17 submission in Appendix A at paragraph 6 of the answer to Question 12.

Loading and Unloading

[124] The TWU submitted that in response to Question 10 of the F17 and contained in Appendix A, the Applicant sets out details of loading and unloading duties and compares entitlements pursuant to the agreement versus Award entitlements.

[125] The TWU referred to point 11(b) where the Applicant states that the Award prescribes a minimum payment of one hour for loading or unloading per trip, however the TWU submitted that this is a misunderstanding of the Award provision at clause 16.6.

[126] The TWU submitted that the minimum payment of one hour applies to each and every loading and/or unloading activity performed by the driver, and the example set out at 11(e)(ii) is not accurate as pursuant to the RT(LDO) a driver engaged in six PUD transactions would be entitled to a minimum of six hours’ loading/unloading but would actually be paid for all time spent loading/unloading.

[127] The TWU submitted that at point 11(d) the Applicant states as follows:

“… linehaul drivers are often not used for loading/unloading work where the time required is likely to take longer than normal.”

[128] The TWU submitted that it is unclear if the driver would be paid for loading/unloading in such circumstances. Additionally, the two sentences in this clause appear to be contradictory.

The TWU submitted that in order to highlight its concerns it set out the following comparison which is based on a Grade 6 driver engaged in a loading task which takes 2 hours.

[129] Pursuant to the proposed Agreement the driver would receive payment equivalent to 66.18kms at the cpk rate. That is 66.18kms x 0.4615 cents = $30.54. Pursuant to the RT(LDO) Award the driver would receive $28.785 per hour. That is $28.785 x 2 = $57.57.

[130] The TWU submitted that the above comparison results in a shortfall of $27.03 for that single event. As the Agreement cpk rate for a Grade 6 driver is only $0.0009 above the current Award, the driver would have to travel 12,000kms at the Agreement cpk rate before the shortfall was nullified.

[131] The TWU submitted that as these transactions are a regular feature of the work of PUD

drivers, the disadvantage would be compounded and incapable of rectification. Furthermore, the Award, at clause 16.6(a) requires that a driver be paid hourly rates for loading and unloading. The Agreement remunerates a driver by way of a cpk which is used for the calculation of daily kilometres. This could result in a driver being paid pursuant to the agreement for daily kilometres which have absorbed the payment for loading/unloading.

[132] The TWU submitted that pursuant to the Award a driver will be paid for kilometres travelled at cpk rates and hourly rates for loading/unloading.

[133] The Applicant submits that the TWU raises a BOOT concern based on its interpretation of clause 16.6 of the RTLDO Award. Specifically, the TWU claims that the correct interpretation of clause 16.6 of the RTLDO Award is that a minimum payment of one hour applies to each and every loading and/or unloading activity performed by the driver and as a result, the example included by the Applicant at paragraph 11(e)(ii) of Appendix A to its Form F17 is not accurate.

[134] The Applicant submits that the TWU is mistaken in its interpretation and relevantly, clause 16.6(a) of the RTLDO Award states:

“Where an employee is engaged on loading or unloading duties, that employee must be paid for such duties at an hourly rate calculated by dividing the weekly award rate prescribed by clause 16.1 by 40 and multiplying by 1.3 (industry disability allowance), provided that a minimum payment of one hour loading and one hour unloading per trip must be made where loading and/or unloading duties are required.” (emphasis added)

[135] The Applicant submitted that it is clear from the wording of clause 16.6(a) that an employee required to perform loading and/or unloading duties is entitled to one hour loading and/or one hour unloading per trip, not per instance of loading or unloading. The TWU’s concern is therefore not valid.

[136] The Applicant also drew the Commission’s attention to the Full Bench’s commentary in the Four Yearly Review Decision (specifically from paragraph [92]-[103]) where Full Bench considered the TWU’s proposal to insert a new pickup and drop-off allowance into the RTLDO. Relevantly, the Full Bench stated:

“[93] It should be noted that cl 13.6 [now 16.6] already provides an allowance for loading and unloading, based on the time taken to perform such duties, with a minimum payment of one hour loading and one hour unloading per trip. This is not limited to requiring payment in circumstances where such work is undertaken at a principal point of commencement or a principal point of destination”

…

[97] There is nothing in the definition of ‘long distance operation’ to imply that an operation will only involve one pickup and one drop-off. For a journey to constitute a long distance operation, it must (at least) involve moving livestock or materials from a principal point of commencement to a principal point of destination. That does not mean the journey might not involve picking up or dropping off at more than one location. Indeed, that possibility is implicit in the use of the word ‘principal’, which implies that there might be ‘secondary’ points of commencement or destination.” at [97].”

[137] The Applicant submitted that its interpretation of clause 16.6 of the RTLDO Award and the use of that interpretation in the example provided by Lindsay Transport at paragraph 11(e)(ii) of Appendix A to its Form F17, is consistent with the interpretation of the Full Bench in the Four Yearly Review Decision.

[138] The Applicant provided a table set out below to summarise the amounts payable under the Agreement relative to the RTLDO Award for the example PUD Transactions outlined in paragraph 11(e)(ii) of Appendix A to Form F17:

Agreement Rates for PUD Transactions		RTLDO Award	6 PUD Transactions in 2 Hours
Driver Classification	Set Distribution	Normal Linehaul	Hourly Rate*	Agreement Set Distribution	Agreement Normal Linehaul	RTLDO Award*
Single Driver	$32.19	$51.40	$28.78	$193.14	$308.40	$57.56
B Double driver	$32.28	$51.40	$30.05	$193.68	$308.40	$60.10

*These are the current RTLDO Award rates, not the rates which applied when the Agreement was lodged.

[139] The Applicant said Linehaul tasks are subject to national fatigue laws which impose limits on the number of hours a driver can work. Under Chain of Responsibility legislation, customers are also responsible for ensuring that the tasks given to a linehaul driver comply with Chain of Responsibility legislation.

[140] The Applicant submitted that given those obligations, many customers do not allow linehaul drivers to undertake pick ups or deliveries (i.e., loading and/or unloading activities) where there is a risk of the driver breaching the fatigue and/or Chain of Responsibility laws. Instead, local delivery drivers are used. In such circumstances, the local delivery driver is paid for the work associated with loading and/or unloading and not the linehaul driver. The average time spent on PUD Transactions across all drivers is just less than one hour (paragraph 11(c)). However, if the tasks which take longer are excluded, it reduces the average even further. The average time spent by linehaul drivers on PUD Transactions is therefore expected to be much less than one hour in each case.

[141] The Applicant relied on its 15 July Submission and its attachment 8 which included modelling of how the Agreement compares to the RTLDO Award and how it meets the BOOT.

Saturday Overtime Rates

[142] The TWU submitted in response to Question 10 of the F17 and contained in Appendix A at point 16 the Applicant claimed that the Agreement provides more beneficial rates for Saturday work than the Award, however this is incorrect. The TWU submitted that the Award distinguishes between overtime worked on Saturday and ordinary hours worked on Saturday. Ordinary hours on Saturday are payable at 150% but overtime worked on Saturday is payable at 150% for the first two hours and double time thereafter.

[143] The Applicant submitted that its comments at paragraph 16 of Appendix A to the Form F17 were meant to refer to the ordinary rates of pay for time worked on Saturday relative to the RTD Award. The Applicant said this was an inadvertent oversight on its F17 during the preparation of its submission.

[144] The Applicant submitted that under the Agreement, staff who work ordinary hours on Saturday are paid OT1 for the first three hours and then OT2 for the remaining time worked, whereas the RTD Award pays 150% of the base rate for ordinary hours worked. In all cases, staff are better off under the Agreement than under the RTD Award if they work ordinary hours on a Saturday.

[145] The Applicant submitted that in any event, the Applicants 15 July Submission at Attachments 5, 6 and 7 shows how pay rates under the Agreement, including those for work performed on Saturday, whether worked as overtime or ordinary hours, are better than the RTD Award.

Conclusion

[146] As set out above, the NES precedence clause resolves a number of other matters raised by the TWU.

[147] I have taken into account the matters raised by the TWU as being detrimental as compared to the Awards including fixed term employment, part time employment, casual conversion, hours of work including ordinary hours on a Sunday, Saturday overtime rates, the formula for calculating kilometres travelled, unpaid meal breaks and shift allowances.

[148] The Agreement provides for higher minimum rates of pay which flow into other entitlements under the Agreement and includes more beneficial allowances, for example the freezer and chiller allowances, sugar season bonuses and other benefits.

[149] I have also taken into account the undertakings offered in relation to the entitlement to a fifth week of annual leave, the industrial action clause, the minimum weekly retainer,higher duties and call back entitlements.

[150] I have considered the modelling provided by the Applicant including the additional 2.5% flowing from the 1 July Annual Wage Review which had not yet occurred at the test time, in the light of areas where the awards are more beneficial. Having considered the competing submissions, the detriments raised by the TWU and a consideration of the modelling provided by the Applicant, I am satisfied on an objective assessment of those matters in addition to the undertakings offered, the Agreement passes the BOOT.

[151] The bargaining representatives have been provided with a copy of the undertakings and have had an opportunity to express a view about them. I am satisfied that the undertakings do not cause financial detriment to any employee covered by the agreement and do not result in substantial changes to the Agreement, and I accept those undertakings and they will become a term of the Agreement.

[152] The TWU lodged a Form F18 statutory declaration and gave notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) of the Act, I note that the Agreement covers the TWU.

[153] The Agreement is approved and will operate in accordance with s.54 of the Act.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

[2021] FWCA 6307

15 OCTOBER 2021

Conclusion