Mount Scopus Memorial College Early Learning Limited T/A Mount Scopus Early Learning
[2024] FWC 766
•27 MARCH 2024
| [2024] FWC 766 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.319 - Application for an order relating to instruments covering new employer and non-transferring employees
Mount Scopus Memorial College Early Learning Limited T/A Mount Scopus Early Learning
(AG2024/368)
| Educational services | |
| DEPUTY PRESIDENT MILLHOUSE | MELBOURNE, 27 MARCH 2024 |
Application for an order relating to instrument covering non-transferring employees – section 319.
Mount Scopus Memorial College Early Learning Limited T/A Mount Scopus Early Learning (applicant) has made an application for orders pursuant to s 319 of the Fair Work Act 2009 (Cth) (Act). The application is made in the context of a transfer of business from Mount Scopus Memorial College Limited to the applicant. The applicant seeks that an order is made in the following terms:
In accordance with section 319(1)(b) of the Fair Work Act 2009, the Mount Scopus Memorial College Agreement 2022 (Agreement) will cover non-transferring employees who perform, or are likely to perform, the transferring work covered by the Agreement for Mount Scopus Memorial College Early Learning Limited.
For the reasons that follow, I am satisfied that the order should be made.
Context
Mount Scopus Memorial College and the applicant are registered charities limited by guarantee. Prior to 1 January 2024, all staff employed at Mount Scopus Memorial College, including in the applicant’s early learning centre, were employed directly by Mount Scopus Memorial College Limited. Under these arrangements, the applicant paid a service fee to Mount Scopus Memorial College Limited for the provision of staff to perform work within its early learning centre.[1]
The applicant decided to insource this work. On and from 1 January 2024, employees of Mount Scopus Memorial College Limited who performed work within the applicant’s early learning centre transferred to the applicant’s direct employment. The applicant’s position is that the transferring employees are performing the same work, in the same location, as prior to the transfer of their employment.[2] It contends that there is a “connection” between Mount Scopus Memorial College Limited and the applicant within the meaning of s 311(5) of the Act, which concerns occasions where the new employer ceases to outsource work to the old employer.
The applicant considers that when the transferring employees commenced employment with it, there was a transfer of business from Mount Scopus Memorial College Limited to the applicant within the meaning of Part 2-8 of the Act. Accordingly, the Agreement covers both the applicant and the transferring employees pursuant to s 313 of the Act.
At the time of making this application, the applicant has not employed any non-transferring employees. However, the applicant submits that any persons employed by the applicant after 1 January 2024 will be non-transferring employees for the purposes of the transfer of business provisions in the Act and would not be covered by the Agreement. This is the effect of s 314(1)(d) which provides that non-transferring employees will be covered by a transferable instrument such as the Agreement only if, at the time they are employed, no other enterprise agreement or modern award covers the new employer. In the present case, the new employer – the applicant – will be covered by the Educational Services (Teachers) Award 2020 or the Educational Services (Schools) General Staff Award 2020, depending upon the work performed.
The application is made for the purposes of ensuring that the Agreement will cover and apply to any non-transferring employees who perform transferring work for the applicant. In the absence of an order under s 319, the appropriate modern award identified above will apply to them.
Consideration
Under s 217 of the Act, the Commission may make certain orders if there is, or is likely to be a transfer of business from an old employer to a new employer. I am satisfied on the basis of the material before the Commission that there was a transfer of business from Mount Scopus Memorial College Limited to the applicant with effect on 1 January 2024 with the result that the Agreement covers and applies to the applicant and the transferring employees.
In deciding whether to make the order sought, I must take into account the factors set out in s 319(3) of the Act.
The views of the new employer or a person who is likely to be the new employer and the views of the employees who would be affected by the order (s 319(3)(a))
The applicant, as the new employer, considers that the application should be granted. There are no non-transferring employees who would presently be affected by the order. The Independent Education Union has advised the Commission that it does not oppose the application.[3]
Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment (s 319(3)(b))
In the circumstances of this matter, the Agreement already covers the transferring employees. The applicant submits that if the order sought is not made, any new employee will be covered by a modern award,[4] each of which are less advantageous to the employees than the Agreement.
I am satisfied that the Agreement provides for more generous conditions than each of the applicable modern awards. As observed in the decision approving the Agreement,[5] this includes through the provision of considerably higher wage rates, such that employees would not be disadvantaged by the proposed order. This is a matter that weighs in favour of granting the order sought.
If the order relates to an enterprise agreement – the nominal expiry date of the agreement (s 319(3)(c))
The nominal expiry date of the Agreement is 13 December 2025. I am satisfied that this is a factor that does not weigh against the making of the order and I regard it as a neutral consideration.
Whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace (s 319(3)(d))
The applicant submits, and I accept, that there would be no negative impact on the productivity of its workplace. This is because the Agreement already covers and applies to the transferring employees. The effect of the order sought is that any non-transferring employees engaged by the applicant would be covered by the same terms and conditions of employment as those transferring employees. This is a matter that weighs in favour of making the order.
Whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer (s 319(3)(e))
The applicant submits, and I accept, that there will be no economic disadvantage as a result of the order being made, noting the Agreement already covers and applies to the applicant. This weighs in favour of the application.
The degree of business synergy between the transferable instrument any workplace instrument that already covers the new employer (s 319(3)(f))
I consider that there is no relevant synergy in this case. This is a neutral consideration.
The public interest (s 319(3)(g))
I do not consider there to be any public interest considerations arising in this matter.
Conclusion
The considerations under s 319 of the Act that apply to the exercise of the Commission’s discretion to make the order sought are either neutral or weigh in favour of making the order. The application is supported by the Independent Education Union. Taking into account these matters, and all the circumstances, I consider that it is appropriate to grant the application.
The order will come into operation in relation to non-transferring employees from 27 March 2024 or, if a non-transferring employee is employed by the applicant after that day, from the date of the commencement of the employee’s employment with the applicant.
An order giving effect to this decision is issued separately in PR772713.
DEPUTY PRESIDENT
[1] Statutory declaration of Helen Stanley, Director – People and Culture, in support of application for orders in relation to transfer of business dated 29 February 2024 at [1]-[4]
[2] Ibid at [5]
[3] Email dated 1 March 2024
[4] Either the Educational Services (Teachers) Award 2020 or the Educational Services (Schools) General Staff Award 2020, depending on the work performed
[5] [2022] FWCA 4372 at [5]
Printed by authority of the Commonwealth Government Printer
<AE518532 PR772711>
0
0
0