Mt Pritchard & District Community Club Ltd t/as Harbord Diggers

[2014] FWC 3165

[2014] FWC 3165

FAIR WORK COMMISSION

DECISION

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

Mt Pritchard & District Community Club Ltd t/as Harbord Diggers
(AG2014/5851)

DEPUTY PRESIDENT SAMS SYDNEY, 14 MAY 2014

Application in relation to transfer of business - transferable instrument - application that the transferrable instrument not cover transferring employees - orders granted. .

[1] This is an application, pursuant to s 318 of the Fair Work Act 2009 (the ‘Act’) filed by Mt Pritchard & District Community Club Ltd t/as Harbord Diggers (the ‘applicant’), which seeks orders from the Fair Work Commission (the ‘Commission’) that a transferrable instrument, being the North Shore Catering Pty Ltd - Certified Agreement 2006-2009 [AG848919] (the ‘Agreement’) not apply to the applicant in relation to the employment of catering staff who have transferred their employment from North Shore Catering Pty Ltd (the ‘old employer’) to the applicant (s 311).

[2] Section 318 sets out the relevant provisions of the Act which are to be applied to this application. They are expressed as follows:

‘318 Orders relating to instruments covering new employer and transferring employees

Orders that the FWC may make

(1) The 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) The 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 the FWC must take into account

(3) In deciding whether to make the order, the 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.’

[3] In the applicant’s Form F40 - Application for Orders in Relation to Transfer of Business - Ms A Koelmeyer, Solicitor for the applicant, said that the catering arrangements at the applicant’s Club were formerly managed by North Shore Catering Pty Ltd. As of July 2011, the catering was insourced and a number of North Shore Catering employees were offered and accepted employment by the applicant. The Agreement they were covered by at the time, expired on 1 March 2009.

[4] Ms Koelmeyer said that the applicant recently undertook a review of the provisions of the Agreement, which revealed that most of the content of the Agreement is outdated and did not allow for the Club’s operational or rostering efficiency. It was proposed that the catering employees will be covered by the Registered and Licensed Award 2010 [MA000058](the ‘Modern Award’). The Modern Award is more generous overall than the Agreement. If the orders were made, the affected employees would be employed on the same terms and conditions as other of the Club’s employees employed under the Award, as there was no history of agreements applying to the Harbord Diggers Club.

[5] Following the review, Ms Koelmeyer said the Club had taken a number of steps to consult with the catering employees regarding its intention to have the Modern Award apply to their employment, rather than the Agreement. Ms Koelmeyer annexed copies of correspondence provided to catering staff, including a memo circulated to staff dated 25 February 2014. This memo contained a detailed comparison document prepared by the applicant. It invited employees to vote on whether they agree to have the Agreement terminated by the Commission. The comparison document summarised the advantages of being covered by the Award, the most significant of which are higher rates of pay and double the number of classifications, thereby providing greater opportunity for employees to move between classifications.

[6] In an accompanying Statutory Declaration attested to by Ms A Martin, Group Employment Relations Manager at Mt Pritchard & District Community Club Limited, it was noted that although the memo specifically made reference to the applicant’s intention to ‘terminate the Agreement’, it was in fact intended to ask the catering employees to vote on whether to cease the application of the Agreement to them. A copy of the memo was provided to United Voice (Liquor and Hospitality Division) (the ‘Union’), an industrial organisation which is entitled to represent the industrial interests of the employees. A further memo was issued on 3 March 2014 clarifying the applicant’s position regarding the type of application to be made to the Commission. A copy of this memo was also provided to the Union.

[7] Ms Martin facilitated a staff meeting at the Club’s premises, attended by management and approximately 10 of the 33 catering staff. She provided details of the review process and its findings, the comparison table, the voting procedure and the application to be made to the Commission. A vote of employees took place on 13 and 14 March 2014. Of the 30 catering staff affected by the change, 15 voted in favour of terminating the Agreement and 4 voted against.

[8] At a hearing of the application on 12 May 2014, Ms Koelmeyer submitted that the employees would not be disadvantaged by the making of the orders, and in view of their vote in favour of terminating the Agreement, there was no reason why the Commission would not make the orders sought.

[9] Ms Koelmeyer submitted that the making of the orders would have a positive impact on productivity (s 318(3)(d)) and business synergy (s 318(3)(f)) and, conversely, that the applicant would sustain economic disadvantage if it is required to maintain different sets of terms and conditions within one area of its business (s 318(3)(e)). She further put that it would not be contrary to the public interest for the orders to be made.

[10] Having reviewed the filed documentation and considered the submissions of Ms Koelmeyer, I am satisfied that all the requirements of s 318 of the Act have been met. Specifically, I have taken into account all of the matters in subsection 3 of s 318 in arriving at my decision and note, in particular, that the employees will be better off under the Award, rather than the Agreement. Accordingly, I propose to issue orders sought by the applicant, which accompany the publication of this decision. Pursuant to ss 4 of s 318, and at the request of the applicant, the orders shall take affect from 21 May 2014.

DEPUTY PRESIDENT

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