Ms Rianna Stojko; Eastern Australia Airlines Pty Limited

[2016] FWC 351

[2016] FWC 351

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees

Ms Rianna Stojko; Eastern Australia Airlines Pty Limited
(AG2016/3)

Airline operations
VICE PRESIDENT WATSON	MELBOURNE, 5 FEBRUARY 2016

Application by Stojko, Rianna & Eastern Airlines Pty Limited and Ms Stojko – Transferrable instrument – Application that transferrable instrument not cover transferring employee – Conditional offer of employment – Fair Work Act 2009, ss.311, 312, 317 and 318.

Introduction

[1] This decision concerns a joint application by Ms Rianna Stojko and Eastern Australia Airlines Pty Limited (Eastern) for an order under s.318 of the Fair Work Act 2009 (the Act) which relates to instruments covering a new employer and transferring employees in the context of a transfer of business.

[2] The application concerns Ms Stojko who is currently employed by Jetstar Airways Pty Limited (Jetstar) under the Jetstar Airways / ASU Agreement 2015 (the Jetstar Agreement). Ms Stojko and Eastern seek an order that the Jetstar Agreement will not cover Eastern in relation to Ms Rianna Stojko when she commences employment with Eastern and at any time for the duration of her employment with Eastern.

[3] For the purpose of s.311(6) of the Act, Jetstar and Eastern are associated entities or have a connection by virtue of their status as related bodies corporate, as that term is defined by s.50 of the Corporations Act 2001.

Background

[4] Ms Stojko is employed by Jetstar in the position of Customer Service Officer. The terms and conditions of her position at Jetstar are regulated by the Jetstar agreement. Ms Stojko is currently on a fixed term secondment to Eastern until 22 May 2016 as a Customer Service Agent. Upon the expiration of the secondment, and the absence of Ms Stojko obtaining ongoing employment with Eastern, Ms Stojko will revert to her position as a Customer Service Officer at Jetstar.

Ms Stojko has applied for, and has been offered, a position as a Customer Service Agent at Eastern. The offer is subject to an order pursuant to s.318 of the Act being in place to ensure that no transfer of business can take place.

The relevant legislation

[5] Part 2-8 of the Act describes when a transfer of business occurs and provides for the transfer of enterprise agreements, certain modern awards and certain other instruments if there is a transfer of business from one employer to another employer.

[6] Section 311(1) contains the definition of transfer of business in a wider manner than the ordinary English or legal meaning of the term. The definition is:

“(1) There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:

(a) the employment of an employee of the old employer has terminated;

(b) within 3 months after the termination, the employee becomes employed by the new employer;

(c) the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;

(d) there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).”

[7] Sections 317 and 318 of the Act relevantly provide:

“317 FWC may make orders in relation to a transfer of business:

This Division provides for FWC to make certain orders if there is, or is likely to be, a transfer of business from an old employer to a new employer.

318 Orders relating to instruments covering new employer and transferring employees

Orders that FWC may make

(1) FWC may make the following orders:

(a) an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;

(b) an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.

Who may apply for an order

(2) FWC may make the order only on application by any of the following:

(a) the new employer or a person who is likely to be the new employer;

(b) a transferring employee, or an employee who is likely to be a transferring employee;

(c) if the application relates to an enterprise agreement—an employee organisation that is, or is likely to be, covered by the agreement;

(d) if the application relates to a named employer award—an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (b).

Matters that FWC must take into account

(3) In deciding whether to make the order, FWC must take into account the following:

(a) the views of:

(i) the new employer or a person who is likely to be the new employer; and

(ii) the employees who would be affected by the order;

(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment;

(c) if the order relates to an enterprise agreement—the nominal expiry date of the agreement;

(d) whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace;

(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;

(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;

(g) the public interest.

Restriction on when order may come into operation

(4) The order must not come into operation in relation to a particular transferring employee before the later of the following:

(a) the time when the transferring employee becomes employed by the new employer;

(b) the day on which the order is made.”

Transfer of the Jetstar Agreement

[8] In relation to the factors set out in s.318(3) of the Act, Ms Stojko and Eastern submit that the proposed orders should be made in order to facilitate the transfer of Ms Stojko. It is submitted that despite enlivening the provisions of Part 2-8 of the Act, there is no transfer of business that would cause the Commission concern, and the proposed transfer of employment is voluntary.

[9] In support of the application, Ms Stojko has filed a statutory declaration dated 29 December 2015 in which she states that she supports the order being made. Ms Stojko states that it is in her interests for the order to be made so that she can take up the employment opportunity with Eastern, which will improve her career opportunities and offers more flexibility which she needs as she will be undertaking further studies.

[10] Eastern submits that Ms Stojko will not be severely disadvantaged by the order in relation to the terms and conditions of her employment While Ms Stojko will receive a lower rather of pay than she currently receives under the Jetstar Agreement, Ms Stojko wishes to pursue employment with Eastern for personal and career reasons.

[11] Eastern submits that the application of the Jetstar Agreement at its workplace would have a negative impact on the productivity of the workplace due to the need to administer different terms and conditions of employment for employees performing the same work. It submits that the application of different terms and conditions will likely create division amongst employees and have an adverse impact on employee morale and productivity. Eastern would therefore consider not allowing the transfer to take place if this application were unsuccessful.

[12] Eastern submits that there is very little business synergy between the Jetstar Agreement and the Eastern Australia Airlines Pty Limited and Australian Services Union Agreement 2012. The Jetstar Agreement is reflective of Jetstar’s position as an international and domestic airline, which is substantially different to Eastern’s regional domestic airline.

[13] As the order relates to an enterprise agreement, I have had regard to the nominal expiry date of the Jetstar Agreement, which is 30 September 2017. I have also taken into consideration any matters concerning the public interest.

[14] I am satisfied that the Jetstar Agreement is a transferable instrument as described in s.312 of the Act. The circumstance is a transfer of business within s.311 of the Act as commencing employment with Eastern may be regarded as the termination of employment with Jetstar. The application has been made in accordance with s.318(1) of the Act. The matters that I am required to take into account when considering whether to grant an order in the terms sought are prescribed by s.318(3) of the Act, as set out above. I have considered the factors set out in s.318(3) and am of the view that it is appropriate to make an order in relation to the transfer of Ms Stojko’s employment.

Conclusion

[15] For the above reasons I will make an order that the Jetstar Agreement will not cover Ms Stojko during the period of her employment with Eastern.

VICE PRESIDENT

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