LJ & NJ Wadley Pty Ltd

[2016] FWCA 3284

[2016] FWCA 3284

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement

LJ & NJ Wadley Pty Ltd
(AG2016/971)

LJ & NJ WADLEY PTY LTD ENTERPRISE AGREEMENT 2016

Passenger vehicle transport (non-rail) industry
DEPUTY PRESIDENT BULL	SYDNEY, 31 MAY 2016

Application for approval of the LJ & NJ Wadley Pty Ltd Enterprise Agreement 2016

[1] An application has been made by LJ & NJ Wadley Pty Ltd (the applicant) for the approval of an enterprise agreement known as the LJ & NJ Wadley Pty Ltd Enterprise Agreement 2016 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act) and is a single enterprise agreement.

[2] The Agreement is proposed to cover 35 casual employees who are engaged in the provision of car transport to and from school for disabled children as part of the NSW Assisted School Travel Scheme (the Scheme). The Scheme is provided to enable disabled children to get to and from school safely. Pursuant to s.186(3) of the Act, I am satisfied that the group of employees was fairly chosen based on the operational distinctiveness of the proposed coverage.

[3] In its application, the applicant stated that the Agreement passes the better off overall test (BOOT) as required under s.186 of the Act. In the event that the Agreement was not approved under s.186 of the Act, the applicant sought approval of the Agreement under s.189 of the Act, on the ground that because of exceptional circumstances, approval would not be contrary to the public interest.

Better off overall test (BOOT)

[4] The Passenger Vehicle Transportation Award 2010 (the Award) is the relevant reference instrument with respect to the better off overall test (BOOT) as required under s.186 of the Act.

[5] The rates of pay and relevant entitlements are as per the Award. However, as noted in the employer’s statutory declaration (F17) there are less beneficial provisions under the Agreement:

a. The Agreement entitles casual employees a minimum payment of 3 hours for each day’s engagement as opposed to 3 hours payment per engagement under the Award; and

b. The Agreement offers part time employees a reduced two hour minimum payment per day, in comparison to three hours per engagement under the Award.

[6] In support of the application, the applicant states that the Agreement provides more beneficial terms under the Agreement which are not conferred under the Award:

a) Where a student is absent for up to five days in any one absenteeism period, employees will be continued to be paid; and

b) The work vehicle is used by the employees to travel to and from work at no cost to the employee.

[7] Taking into account the rates of pay and other entitlements are only equivalent to the Award, and factoring in a reduced minimum payment per engagement for employees, I am not persuaded that the benefits conferred by the Agreement means that employees are better off under the Agreement. As such, I am not of the view that the Agreement satisfies the better off overall test as required under s.186 of the Act.

s. 189(2) of the Act

Exceptional circumstances

[8] As submitted in the alternative, should the Commission not be satisfied that the Agreement meets the BOOT, there was a public interest in the Agreement being approved pursuant to s.189 of the Act.

[9] As the Commission is not of the view that the Agreement satisfies the BOOT, it is necessary to consider whether the Agreement can be approved under s.189 of the Act, on the basis that because of exceptional circumstances, approval of the Agreement would not be contrary to the public interest.

[10] Section 189 of the Act provides instances when the FWC may approve an enterprise agreement that does not pass better off overall test with regard to the public interest test:

Section 189 FWC may approve an enterprise agreement that does not pass better off overall test – public interest test

            “ 189(1)  This section applies if:

(a) the FWC is not required to approve an enterprise agreement under section 186; and

(b)  the only reason for this is that the FWC is not satisfied that the agreement passes the better off overall test.

Approval of agreement if not contrary to the public interest

189(2)  The FWC may approve the agreement under this section if the FWC is satisfied that, because of exceptional circumstances, the approval of the agreement would not be contrary to the public interest.

189(3)  An example of a case in which the FWC may be satisfied of the matter referred to in subsection (2) is where the agreement is part of a reasonable strategy to deal with a short-term crisis in, and to assist in the revival of, the enterprise of an employer covered by the agreement.”

Nominal expiry date

189(4)  The nominal expiry date of an enterprise agreement approved by the FWC under this section is the earlier of the following:

(a) the date specified in the agreement as the nominal expiry date of the agreement;

   (b)  2 years after the day on which the FWC approved the agreement.

[11] The Full Bench in Cheyne Leanne Nulty v Blue Star Group Pty Ltd 1examined the ordinary meaning of exceptional circumstances at paragraph 13 of that decision:

“In summary, the expression "exceptional circumstances" has its ordinary meaning and requires consideration of all the circumstances. To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare.”

My underline

[12] The submissions of the applicant state that arrangements in the Agreement for the minimum payment of two hours, rather than three hours per engagement were made in the context of New South Wales legislation. The Education Department mandates that no child is to be transported for longer than 90 minutes either going to school or returning from school.

[13] It is submitted that the requirements and work performed can be characterised as ‘special’ because of the nature in which drivers are engaged to transport disabled school children under the State Government’s Assisted School Travel Scheme. In particular, travel time limitations placed on drivers by the education department as well as the eligibility of children for this program and the presence of children’s Assisted Support Officer.

[14] I accept that the time restraint imposed on the operations of the applicant can be construed as an exceptional circumstance justifying the application of s.189.

Public interest

[15] Having established that the Agreement does not meet the better off overall test, and that ‘special’ circumstances apply, the Commission may only approve the Agreement if it is not contrary to the public interest.

[16] The Full Bench in Transport Workers’ Union of Australia v Jarman Ace Pty Ltd T/A Pty Ltd Ace Buses 2 at paragraph 34 stated:

“Section 189 of the Act requires a decision-maker to make a discretionary decision in determining if he or she is satisfied that, because of exceptional circumstances, the approval of the agreement would not be contrary to the public interest.”

[17] The test in s. 189(2) is whether the agreement, because of exceptional circumstances, is not contrary to the public interest, which is a lower test than whether approval of the agreement is in the public interest 3. 

[18] Public interest was examined in O’Sullivan v Farrer (1989) 168 CLR 210, the High Court said (at 216):

“… the expression “in the public interest”, when used in a statute, classically imports a discretionary value judgment to be made by reference to undefined factual matters, confined only “in so far as the subject matter and the scope and purpose of the statutory enactments may enable … given reasons to be [pronounced] definitely extraneous to any objects the legislature could have had in view”: Water Conservation and Irrigation Commission (N.S.W.) v. Browning, per Dixon J.”

(Citation omitted.) (Editing in original)

[19] Having regard to the submissions of the applicant, I am satisfied that, given the important community service the applicant is engaged in, it would not be contrary to the public interest for the employees to work under the Agreement, so as to meet the critical needs of their passengers 4.

Approval

[20] I am satisfied that each of the requirements of sections 186, 187 and 188 and 189 of the Act that are relevant to this application for approval have been met, and that such other requirements of the Act have been met.

[21] In my view, based on the submissions of the applicant, it is sufficient to establish that the applicant’s business is subject to interacting factors that generate exceptional circumstances; namely the time limitations imposed on the transportation of children to and from school. For reasons outlined above, I am satisfied that approving the Agreement is not contrary to the public interest.

[22] The Agreement is approved under s.189 of the Act and will operate from 7 June 2016 with a nominal expiry date of two years from the date of this decision.

DEPUTY PRESIDENT

 1   [2011] FWAFB 975

 2   [2014] FWCFB 7097

 3   As stated by Deputy President Bartel in Top End Consulting [2010] FWA 6442

 4  See for example Jarman Ace Pty Ltd t/as Ace Buses [2014] FWCA 3338.

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