National Heavy Vehicle Regulator
[2019] FWC 4070
•17 JUNE 2019
| [2019] FWC 4070 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
National Heavy Vehicle Regulator
(AG2019/1579)
Australian Capital Territory | |
DEPUTY PRESIDENT KOVACIC | CANBERRA, 17 JUNE 2019 |
Application for orders relating to instruments covering new employer and transferring employees – orders made that the ACT Public Sector Infrastructure Services Enterprise Agreement 2018-2021 will not apply to the National Heavy Vehicle Regulator and transferring employees and that the NVHR Greenfields (Operational and On-road Regulatory Compliance Employees) Enterprise Agreement 2017-2020 will apply to transferring employees.
[1] This decision concerns an application made on 14 May 2019 pursuant to s.318 of the Fair Work Act2009 (the Act) by the National Heavy Vehicle Regulator (NHVR – the Applicant) seeking orders that:
• the ACT Public Sector Infrastructure Services Enterprise Agreement 2013-2017 (the 2013 Agreement) 1 does not and will not cover the Applicant nor the two transferring employees; and
• the NVHR Greenfields (Operational and On-road Regulatory Compliance Employees) Enterprise Agreement 2017-2020 (the NVHR Agreement) 2 will apply to the two transferring employees in respect of their employment with the Applicant.
[2] An amended application was filed by the Applicant on 29 May 2019 given that on 14 May 2019 the Fair Work Commission (the Commission) approved the ACT Public Sector Infrastructure Services Enterprise Agreement 2018-2021 (the 2018 Agreement – the transferring instrument) 3, the replacement agreement for the 2013 Agreement. In the amended application, the first of the above orders was amended such that the 2018 Agreement would not cover the Applicant and transferring employees.
[3] By way of background, the NHVR was formed as part of a Council of Australian Governments reform to consolidate and harmonise the laws of each State and Territory for the regulation of heavy vehicles and establish a single, national agency with responsibility for administering those laws. The NHVR is responsible for the regulation of heavy vehicles in Queensland, New South Wales, Victoria, Tasmania, South Australia and the Australian Capital Territory. Since 16 August 2013, Access Canberra has conducted regulatory functions on behalf of the NHVR under a service level agreement which includes assessing heavy vehicles and their drivers for compliance with the provisions of the Heavy Vehicle National Law in the ACT. However as of 1 July 2019 Access Canberra will no longer undertake these activities on behalf of the NHVR as they will be performed directly by the NHVR. The NHVR has employed two employees (i.e. the transferring employees) to be based in the ACT to perform these activities. The transferring employees are both currently employed by Access Canberra as full-time employees. Their employment with Access Canberra will terminate on 30 June 2019 and their employment with the NHVR will commence on 1 July 2019.
[4] Ms Cara Black – Manager, Legal Services with the NHVR – provided two affidavits in support of the application.
Relevant legislation
[5] The relevant sections of the Act are ss.313 and 318 which provide as follows:
“313 Transferring employees and new employer covered by transferable instrument
(1) If a transferable instrument covered the old employer and a transferring employee immediately before the termination of the transferring employee’s employment with the old employer, then:
(a) the transferable instrument covers the new employer and the transferring employee in relation to the transferring work after the time (the transfer time) the transferring employee becomes employed by the new employer; and
...
(3) This section has effect subject to any FWC order under subsection 318(1).
…
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;
…
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.”
[6] Before turning to consider each of the matters specified in s.318(3) the Act, I note that the NHVR, as the new employer, has standing pursuant to s.318(2)(a) of the Act to make the application for the orders sought.
The views of the new employer [s.318(3)(a)(i)]
[7] In her first affidavit Ms Black stated that the NHVR was seeking the orders set out in its application for several reasons including that:
• the NHVR Agreement was appropriately tailored to its operations;
• applying the NHVR Agreement would promote workplace culture, prevent disparity arising between the transferring employees and non-transferring employees and reduce the costs incurred in the administration of employment conditions;
• having to recognise two different industrial instruments in the workplace for employees performing similar roles would create disharmony, including uncertainty and unfairness for non-transferring employees;
• in the absence of the orders sought being made the NHVR would have to run a separate timekeeping and payroll management system for the transferring employees; and
• further negative impacts on costs and productivity would arise from the fact that the NHVR’s human resources team would need to ensure that all other terms and conditions of the transferring employees’ employment were maintained, including differing rostering principles and performance management cycles.
[8] The NHVR also noted in its amended application that bargaining for a new enterprise agreement to replace the NHVR Agreement would be simpler if the starting point was that all relevant employees were covered by the same terms and conditions of employment.
The views of the employees who would be affected by the order [s.318(3)(a)(ii)]
[9] Attached to Ms Black’s initial affidavit were copies of the offers of employment made to each of the transferring employees on 2 May 2019 as well as copies of letters of support signed by both transferring employees in respect of the application currently before the Commission. The offers of employment included the following:
“As has been explained to you, you are classified as a ‘transferring employee’ within the definition of the Fair Work Act 2009 (Cth) (FW Act), as you will be expected to perform the same or substantially the same duties and work with the NHVR as you have previously performed with Access Canberra.
The NHVR intends to make an application to the Fair Work Commission (FWC) to seek orders that all transferring employees impacted by the above transfer, including yourself, who accepted employment with us, will be covered by the NVHR Greenfields (Operational and On-road Regulatory Compliance Employees) Enterprise Agreement 2017-2020 (the NHVR Greenfields EA), in place of the ACT Public Sector Infrastructure Services Enterprise Agreement 2013-2017, which is a Transferable Instrument for the purposes of the FW Act. This will be done by the lodgement of Form F40 – Application for orders in relation to a transfer of business and you will be informed of the outcome of this application as soon as it is determined.
Assuming our application is successful, this would result in the FWC making an order that your terms and conditions of employment would be governed by the NHVR Greenfields EA, which all existing operational and on-road regulatory compliance employees are governed by, and the Transferrable Instrument would no longer apply to you.
This offer and subsequent employment with the NHVR are subject to, and conditional on the above transfer being completed as expected and the NHVR being successful in obtaining the abovementioned FWC orders.” 4
[10] The letters of support signed by the two transferring employees read as follows:
“I, …, confirm that I have been informed that the National Heavy Vehicle Regulator (‘NHVR’) intends to make an application to the Fair Work Commission seeking orders that transferring employees, as a result of a transfer of business from Access Canberra to the NHVR, be covered by the NVHR Greenfields (Operational and On-road Regulatory Compliance Employees) Enterprise Agreement 2017-2020 (NHVR Greenfields EA), in place of Transferable Instruments including the ACT Public Sector Infrastructure Services Enterprise Agreement 2013-2017.
I understand that I am considered to be a transferring employee within the definition in the Fair Work Act 2009 (Cth) and that the above application will be relevant to my employment with the NHVR.
I confirm that I have been provided with a letter of offer of employment from the NHVR which also contained a copy of the NHVR Greenfields EA and explained the NHVR’s intention to seek the abovementioned order from the Fair Work Commission prior to my commencing employment with the NHVR.
I confirm that I have been consulted with about the changes to my employment terms should I be covered by the NHVR Greenfields EA in place of the Transferable Instruments. I have been provided with a copy of the “NHVR industrial instrument comparison document” which sets out a comparison of the terms and conditions under the Transferable Instruments and the NHVR Greenfields EA.
I have been given the opportunity to discuss and raise questions with the NHVR and these have been responded to.
I have been given the opportunity consult with a Union representative.
I provide my support for the application that my employment with the NHVR be covered by the NHVR Greenfields EA.” 5
[11] Ms Black in her supplementary affidavit dated 29 May 2019 stated that following approval of the 2018 Agreement by the Commission both transferring employees were contacted on 22 May 2019 and advised that the 2018 Agreement was now the relevant transferable instrument applicable to their employment. Ms Black further stated that on 27 May 2019 the transferring employees were sent an email attaching among other things:
• a copy of the 2018 Agreement;
• the ACT Government’s document titled “What’s different about the ACT Public Sector Infrastructure Services Enterprise Agreement 2018-2021”; and
• an updated industrial instrument comparison document which provided additional detail on differences between the NHVR Agreement, the 2013 Agreement and the 2018 Agreement.
[12] Both transferring employees subsequently provided letters indicating their ongoing support for the orders sought by the NVHR via the application presently before the Commission. Those letters were in similar terms to the initial letter of support set out above, with references to the 2013 Agreement replaced by references to the 2018 Agreement.
[13] The fact that each transferring employee has twice provided a letter of support which expresses their support for the NHVR’s application that their employment with the NHVR be covered by the NHVR Agreement weighs in favour of making the orders sought.
Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment [s.318(3)(b)]
[14] In her first affidavit Ms Black set out the current and post-transfer salary and hours of work of the transferring employees and the more beneficial and less beneficial aspects of the NHVR Agreement when compared to the transferring employees’ current terms and conditions of employment.
[15] With regard to salary, both transferring employees if employed under the NVHR Agreement would be paid between $3,955 and $5,269 more than their current salary though their hours of work would be 38 hours per week as opposed to 36.75 hours per week as is currently the case under the 2018 Agreement.
[16] In her affidavit Ms Black described the more beneficial aspects of the NVHR Agreement as including paid rest breaks of 20 minutes during each shift, a paid meal break of 30 minutes during ordinary hours of work and a higher salary increase of 2.5% per annum or the increase in the Consumer Price Index (whichever is higher) as opposed to 1.35% from 1 July 2019 under the 2018 Agreement. In addition, Ms Black pointed to the NHVR operating across several jurisdictions as offering the possibility of working in other States.
[17] As to the less beneficial provisions of the NHVR Agreement, Ms Black highlighted that currently the transferring employees are entitled to:
• 18 days personal leave per annum, as opposed to 10 days per annum under the NHVR Agreement;
• purchase 12 weeks of annual leave each year, as opposed to 8 weeks per annum under the NHVR Agreement;
• 18 weeks primary carer leave per pregnancy, as opposed to 16 weeks per annum under the NHVR Agreement;
• 20 days paid domestic violence leave per annum, as opposed to 10 days per annum under the NHVR Agreement;
• 15 days industrial relations leave per annum, as opposed to 38 hours per annum under the NHVR Agreement; and
• broader opportunities for salary packaging.
[18] In summary, the NHVR submitted that, taking into consideration the full suite of monetary and non-monetary benefits associated with being covered by the NHVR Agreement and the broader package of terms and conditions offered to and accepted by the transferring employees, the transferring employees would not on balance be disadvantaged by the orders sought.
[19] While there is an element of swings and roundabouts involved in the comparison, overall the above comparison does not indicate that the transferring employees would be disadvantaged in relation to their terms and conditions of employment by the orders sought, particularly having regard to the higher rates of pay under the NHVR Agreement. For instance, while hours of work for the transferring employees would increase by 1.25 hours per week, this is counterbalanced by access to paid rest and meal breaks. This favours the making of the orders sought.
The nominal expiry date of the agreement [s.318(3)(c)]
[20] The 2018 Agreement has a nominal expiry of 31 October 2021 while the NHVR Agreement has a nominal expiry date on 30 August 2020.
Whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace [s.318(3)(d) and s.319(3)(d)]
Any significant economic disadvantage to the new employer [s.318(3)(e)]
[21] The NHVR relied on Ms Black’s first affidavit in respect of these considerations. In particular, the NHVR drew on Ms Black’s statement that in the absence of the orders sought being made it would have to run a separate timekeeping and payroll management system for the transferring employees and that further negative impacts on costs and productivity would arise from the fact that its human resources team would need to ensure that all other terms and conditions of the transferring employee’s employment were maintained.
[22] Beyond this, the NHVR submitted that:
• the need to maintain different employment terms for the transferring employees would be an unnecessary and unproductive burden on it and would create administrative difficulties associated with having to apply multiple industrial instruments; and
• having different industrial instruments apply to employees performing the same or similar work would impact negatively on productivity and be a barrier to developing harmonious work arrangements.
[23] I accept that having to apply multiple industrial instruments carries with it administrative overheads which result in increased costs and have the potential to impact negatively on productivity and harmonious workplace relations. These considerations support the making of the orders sought.
The degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer [s.318(3)(f)]
[24] The NVHR, drawing on Ms Black’s first affidavit, noted that as the NHVR Agreement was appropriately tailored to its operations it provided greater business synergy than the 2018 Agreement (i.e. the transferring instrument). This favours the making of the orders sought.
The public interest [s.318(3)(g)]
[25] The NHVR contended in its amended application that it was in the public interest to have one industrial instrument cover all employees that fall within its classification structure as this would prevent disparity arising between the transferring employees and its other employees. The NHVR further contended that the efficient and effective operation of the business of an employer was also a matter in the public interest, adding that it was not in the public interest for a workforce to be covered by various industrial instruments. As such, the NHVR submitted that it was clearly in the public interest for the orders sought to be made.
[26] Given the important work of the NHVR, I am satisfied that it is in the public interest to make the orders sought.
Conclusion
[27] Taking into account each of the matters set out in s.318(3), I am satisfied that the orders sought should be made.
[28] The order (PR709269) will be issued to provide that the 2018 Agreement does not and will not cover the NVHR nor the two transferring employees and that NHVR Agreement will apply to the transferring employees. The orders will operate from the date the transferring employees commence employment with the NHVR, i.e. 1 July 2019.
Printed by authority of the Commonwealth Government Printer
<AE412232 PR709268 >
1 AE412232
2 AE425567
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4 Affidavit of Cara Black dated 14 May 2019 at Annexures CB-10 and CB-11
5 Ibid
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