Motors Tas Pty Ltd T/A Webster Trucks

[2020] FWCA 3413

[2020] FWCA 3413

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.217 - Application to vary an agreement to remove an ambiguity or uncertainty

Motors Tas Pty Ltd T/A Webster Trucks
(AG2020/1433)

WEBSTER TRUCKS ENTERPRISE AGREEMENT 2019-2022

Vehicle industry
COMMISSIONER SPENCER	BRISBANE, 30 JUNE 2020

Application for variation of the Webster Trucks Enterprise Agreement 2019-2022 - Clause 9.1.

[1] This decision is in relation to an application made under s.217 of the Fair Work Act 2009 (the Act) by Motors Tas Pty Ltd T/A Webster Trucks (the Applicant) to vary the Webster Trucks Enterprise Agreement 2019-2022 (the Agreement) in order to remove an ambiguity or uncertainty.

[2] The Applicant submitted that an ambiguity or uncertainty has arisen in relation to clause 9.1 of the Agreement and whether employees are entitled to payment at 150% for two hours where they work more than 38 hours per week.

[3] In order to remove the ambiguity or uncertainty, the Applicant requested a variation to clause 9.1 and the undertaking to clause 9.1 given by the Applicant.

[4] Clause 9.1 of the Agreement reads:

“9.1 The rostered hours of work are 40 hours per week comprising 38 ordinary hours of work, plus, in order to meet customer service and manufacturer requirements, an additional 2 hours per week, worked between 7.00am to 7.00pm Monday to Saturday inclusive. The parties agree that the hours of work specified are reasonable and necessary having regard to the nature of the Company's business, and the usual patterns of work in the heavy vehicle repair and service industry.”

[5] In the first instance, an undertaking was sought and given that provided:

“2. Additional hours outside 38 hours

In relation to clause 9.1 of the Agreement the employee will receive the 2 hours after

38 ordinary hours at 150%.”

[6] The Applicant submitted there is ambiguity as to whether employees are entitled to payment at 150% for two hours where they work more than 38 hours per week. The Applicant said it was their intention that clause 9.1 of the agreement, and the undertakings on the agreement, would demonstrate employees will be paid 40 hours per week at the rates outlined in Schedule A of the Agreement.

[7] The applicant submitted it was their intention that the hourly rates in Schedule A were calculated to include payment at 150% for two hours where they work more than 38 hours. The intention of the undertaking provided by the Applicant was to demonstrate the hourly rates in Schedule A of the agreement include payment for two hours at 150% after 38 hours have been worked. The Applicant subitted there was poor execution to demonstrate their intentions to Masson DP in the first instance which has resulted in ambiguity.

[8] The Applicant said they had discussed the variation and ambiguity with Mr Jacob Batt, the State Organiser of the Tasmanian Branch of the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) who are a party to the Agreement.

[9] In support of their application, the Applicant provided a spreadsheet with modelling on the base hours worked at the rates of pay in the Agreement but excluding the 150% loading for the additional two hours, which they submitted demonstrates employees are ‘better off’ than they would be under the Award, satisfying s.193 of the Act.

[10] The Applicant also submitted meeting notes which they said demonstrated payment for 40 hours per week was discussed with the parties to the agreement during bargaining. The Applicant also provided documentation and undertakings as provided to Msason DP as part of the application to approve the Agreement.

[11] The Applicant submitted they sought to remove any ambiguity from the Agreement to avoid confusion and reduce the risk of underpayments being made to employees in error, and sought to ensure wages costs are not disproportionate to budgeted costs outlined during bargaining negotiations by eliminating ambiguity.

[12] In considering this application, I sent Directions to the parties for the Applicant to file a consolidated agreement containing the variation sought, and a copy of the proposed variation and undertaking as a separate document. I further directed the AMWU as an employee organisation covered by the Agreement to file any submissions in response to the Application and to indicate whether or not they agreed with the proposed variations.

[13] On 12 June 2020, Mr Batt advised Chambers that the AMWU did not object to the variation of the Agreement as sought.

CONSIDERATION

[14] Section 217 of the Act relevantly provides as follows:

217 Variation of an enterprise agreement to remove an ambiguity or uncertainty

(1) FWA may vary an enterprise agreement to remove an ambiguity or uncertainty on application by any of the following:

(a) one or more of the employers covered by the agreement;

(b) an employee covered by the agreement;

(c) an employee organisation covered by the agreement.

(2) If FWA varies the enterprise agreement, the variation operates from the day specified in the decision to vary the agreement.

[15] In Tenix Defence Systems Pty Ltd Certified Agreement 2001 - 2004 (Full Bench, 9 May 2002, PR917548) considered the meaning of ambiguity

“[28] Before the Commission exercises its discretion to vary an agreement pursuant to s.170MD(6)(a) it must first identify an ambiguity or uncertainty. It may then exercise the discretion to remove that ambiguity or uncertainty by varying the agreement.

[29] The first part of the process – identifying an ambiguity or uncertainty – involved an objective assessment of the words used in the provision under examination. The words used construed having regard to their context, including where appropriate the relevant parts of a related award. As Munro J observed in Re Linfox – CFMEU (CSR Timber) Enterprise Agreement 1997:

“The identification of whether or not a provision in an instrument can be said to contain an ‘ambiguity’ requires a judgment to be made of whether, on its proper construction, the wording of the relevant provision is susceptible to more than one meaning. Essentially the task requires that the words used in the provision to be construed in their context, including where appropriate the relevant parts of the ‘parent’ award with which a complimentary provision is to be read.”

[30] We agree that context is important. Section 170MD(6)(a) is not confined to the identification of a word or words of a clause which give rise to an ambiguity or uncertainty. A combination of clauses may have that effect.

[31] The Commission will generally err on the side of finding an ambiguity or uncertainty where there are rival contentions advanced and an arguable case is made out for more than one contention.

[32] Once an ambiguity or uncertainty has been identified it is a matter of discretion as to whether or not the agreement should be varied to remove the ambiguity or uncertainty. In exercising such a discretion the Commission is to have regard to the mutual intention of the parties at the time the agreement was made.”

[16] From the documents provided by the Applicant, in considering the original application, Masson DP raised concerns regarding clause 9 of the Agreement and whether employees were better off overall:

“Clause 9 of the Agreement provides that ordinary hours are comprised of 38 hours, plus an additional two hours paid at 100%. Clause 28.2 of the Vehicle Manufacturing Repair, Services and Retail Award 2010 (‘the Award’) provides that for any hours outside 38 ordinary hours per week overtime penalties will be payable, resulting in the first two hours up to 40 hours attracting a penalty of 150%, whilst under the Agreement these hours will be paid at ordinary rates.

The Agreement allows for ordinary hours to be worked on a Saturday, and does not appear to provide an additional penalty for such work. Clause 38.2 of the Award provides that any hours worked on a Saturday will attract a penalty of 150%.

Modelling indicates that employees working in the above circumstances will not be better off overall, when not attracting any additional penalties.

The Deputy President seeks submissions and/or undertakings to be provided to address the above issues.”

[17] In its response, the Applicant said:

“We have been complying with the NES and paying the additional 2 hours at 150%, despite the omission from clause 9. We undertake to continue to do this and will amend future Enterprise Agreements accordingly.

We have been paying the additional hours worked on a Saturday at the applicable penalty rates, despite the omission from the Enterprise Agreement. We undertake to continue to do this and will amend future Enterprise Agreements accordingly.”

[18] The Applicant has provided two undertakings when it appears from the correspondence that only one was sought. I note two undertakings were provided in relation to clause 9 of the Agreement, including one which addressed the Saturday penalties issue.

[19] I am satisfied from the meeting notes provided and from the Applicant’s submissions that there was ambiguity in relation to the clause and undertaking provided to the Commission as the intention of the parties was for the higher Agreement rates were intended to compensate for the two hours worked. The effect of the higher rates of pay is to absorb any overtime worked into the combined hourly rate.

[20] I note the original Agreement did not provide for an additional 150% loading for the two hour worked and was voted on and approved by the relevant employees.

[21] On the basis of the material before me, I am satisfied that there is an ambiguity or uncertainty regarding the name of the employer and that the application to remove the ambiguity or uncertainty has been made in accordance with s.217 of the Act.

[22] I am satisfied based on the Applicant’s modelling and independent modelling by the Commission that employees remain better off overall without the undertaking as provided.

[23] Accordingly the application is granted and the variation will operate from today, 30 June 2020. The consolidated version of the Agreement, as varied, is attached to this decision.

COMMISSIONER

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