McCosker Contracting Pty Ltd

[2019] FWC 2624

[2019] FWC 2624

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

McCosker Contracting Pty Ltd
(AG2018/5451)

COMMISSIONER MCKINNON MELBOURNE, 16 APRIL 2019

Application for approval of the MCPL Enterprise Agreement 2018 – single enterprise agreement – better off overall test – application dismissed.

[1] Application has been made by McCosker Contracting Pty Ltd (the Applicant) under s.185 of the Fair Work Act 2009 (the Act) for approval of a single enterprise agreement known as the MCPL Enterprise Agreement 2018 (the Agreement).

[2] Concerns in relation to the application were raised with the Applicant on 27 February 2019 and 29 March 2019 in relation to whether the Agreement excludes the National Employment Standards and in relation to the better off overall test. The Applicant provided its responses to those concerns on 6 March 2019 and 3 April 2019, including by offering undertakings to address some, but not all, of those concerns.

[3] The responses provided by the Applicant would address the concern in relation to the National Employment Standards. However, they do not resolve my concerns in relation to whether the Agreement passes the better off overall test because they do not address concerns about what are effectively loaded rates of pay, nor that the redundancy definition in the Agreement is narrower than in the Award.

[4] The Agreement covers some 93 pay points and the Applicant has offered an undertaking that the minimum wage level in the Agreement will be 18.5 (equivalent to $24.42 per hour). With that undertaking, I would be satisfied that rates of pay in the Agreement are higher in each case than the rates of pay in the Building and Construction General On-Site Award 2010 (the Award), which is the relevant modern award for the purposes of the better off overall test. There are also a range of other benefits in the Agreement, including most significantly in relation to shift penalties and income protection insurance.

[5] The Agreement also contains a number of less beneficial terms. The most significant of these are the narrower definition of redundancy compared to the Award, lower meal allowance and the absence of annual leave loading, special and industry allowances, each of the Award fares and travel patterns allowances and overtime crib breaks only after 10 hours has been worked. Other allowances not provided for in the Agreement but relevant to the work of employees who would be covered by the Agreement are air-conditioning and refrigeration industry allowance, hot, wet and dirty work allowances, confined space allowance, toxic substances allowance, acid work allowance, bitumen work allowance, powdered lime dust allowance and sand blasting allowance.

[6] The Commission’s analysis shows that a CW2 employee under the Award working a 50 hour week from Monday to Friday would earn $1592.77 under the Award compared to $1572.56 under the Agreement taking into account special and industry allowance, annual leave loading, daily fares allowance, meal allowance and overtime crib breaks. The analysis does not include any of the additional allowances that may become payable in particular circumstances. Nor does it take into account the loss of redundancy entitlements under the Award due to the narrower than Award definition (valued at 2.4 weeks per year or 4.6%, or 8 weeks/1.5% after four or more years’ service), or the gain in relation to income protection allowance, which has a value of up to 1.6% of gross weekly earnings according to clause 18 of the Agreement.

[7] On the material before me, and on balance, I am not satisfied that each class of employees will be better off overall under the Agreement than if the Award applied to them.

[8] The result is that the Agreement cannot be approved. The application is dismissed.

COMMISSIONER

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