National Protection Group T/A NPG Australia - [2010] FWA 9351

[2010] FWA 9351
[Note: a correction has been issued to this document - see 2010FWA9351_PR504994 signed 14 December 2010]

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement

National Protection Group T/A NPG Australia
(AG2010/12158)

COMMISSIONER LEWIN

MELBOURNE, 3 DECEMBER 2010

National Protection Group Australia - Enterprise Agreement -2010.

Introduction

[1] This is an application for approval of an enterprise agreement, the National Protection Group Australia - Enterprise Agreement - 2010 (the Agreement). The application was made on 5 July 2010 by Akash Ahluwalia of National Protection Group Australia Pty Ltd. Worksite Resolutions is identified in the supporting materials with the application as a bargaining agent for the employer subject to the Agreement. Interestingly, Worksite Resolutions claims Copyright over the Agreement. The Agreement was made on 8 July 2010. 1

[2] I received the application on 13 July 2010. On reading the terms of the Agreement and considering the terms of the Security Services Industry Award 2010 (the Award), I became concerned that the Agreement did not pass the better off overall test. 2 The Agreement excluded the operation of any Award or Industrial Agreement. The Agreement contains a number of terms regulating the hours of work and provides for flat hourly rates for all work performed at any time on weekdays and weekends respectively.3 The Agreement contains no night shift penalty4, no overtime penalty5 and allowed for the working of what are described by its terms as Voluntary Additional Hours6, which were hours of work in addition to the ordinary hours of work paid for at ordinary time rates.

[3] I referred the Agreement to the Enterprise Agreements Unit of Fair Work Australia for analysis. The flat rates of pay prescribed by the Agreement appeared to be lower than the payments which would apply under the Award when modelled as part of notional rosters of work and compared with the relevant Award provisions prescribing payment which would apply to those rosters.

[4] The rates also included compensation for annual leave loading which is a term of the Award and must also compensate for any allowance payable under the relevant terms of the Award. The public holiday rate of pay for work performed on a public holiday appeared to be less than that prescribed by the relevant Award.

[5] The supporting material filed with the application stated that another enterprise agreement in identical or substantially similar terms had been dealt with as follows 7:

“Matter No. AG2009/22573 Decision Date: 23 February 2010 Member: DP Ives

Agreement Name: Prosec Corporate Services Enterprise Agreement 2009

Employer: Prosec Corporate Service Pty Ltd.”

[6] The application for approval of the abovementioned enterprise agreement was refused by Deputy President Ives. In his decision refusing approval of the Agreement 8 the Deputy President said as follows:

“[4] A consideration of the application in the light of the No Disadvantage Test, as required by s.186(2)(d) of the Act as modified by Schedule 7 of the Transitional Act, leads me to conclude that the Agreement does not pass the No Disadvantage Test for the reason that increases to wage rates payable under the relevant award, are insufficient to compensate for significantly reduced entitlements when compared to the relevant Award including removal/reduction of penalty rates, removal of allowances and loadings.

[5] The application for approval is refused.”

[7] I received a report on the analysis of the terms of the Agreement by the Enterprise Agreement Unit of Fair Work Australia on Friday 17 September 2010. The report indicated that the Agreement did not pass the better off overall test. The analysis indicated a deficiency of approximately 3% for an employee employed under the terms of the Agreement when comparative modelling of certain rosters of work against the terms of the Agreement and the Award was undertaken.

Statutory provisions and the approach to the application

[8] In McDonald's Australia Pty Ltd on behalf of Operators of McDonald's outlets [2010] FWA 1347, the Full Bench of Fair Work Australia considered the role of Fair Work Australia in relation to the approval of enterprise Agreements:

“[12] Part 2-4 of the Act deals with enterprise agreements. That part has specific objects expressed in s 171 as follows:

“171 Objects of this Part

The objects of this Part are:

(a) to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and

(b) to enable FWA to facilitate good faith bargaining and the making of enterprise agreements, including through:

(i) makingbargaining orders; and

(ii) dealing with disputes where the bargaining representatives request assistance; and

(iii) ensuring that applications to FWA for approval of enterprise agreements are dealt with without delay.”

[13] The appellants emphasised the facilitative aspects of these objectives. We agree that these objectives place the primary role for making enterprise agreements on the parties to those agreements and their representatives and that the role of Fair Work Australia includes facilitating the making of enterprise agreements. In general we believe that the requirements for approval should be considered in a practical, non-technical manner and that reasonable efforts should be made to clarify matters with the parties and consider undertakings to clarify or remedy concerns to the extent that these may be available under s.190 of the Act.”

[9] In Bupa Care Services Pty Ld v P & A Securities Pty Ltd as trustee for the D’Agostino Family Trust T/as Michel’s Patisserie Murwillumbah and others [2010] FWAFB 2762 (‘BUPA’), the Full Bench, when considering the role of the Tribunal in relation to applications for the approval of enterprise agreements, determined that where the Tribunal is concerned or satisfied that an enterprise agreement submitted for approval does not pass the better off overall test, the Tribunal should proceed as follows:

“(a) give BUPA [the employer] the opportunity to give a written undertaking aimed at meeting that concern;

(b) consider whether any written undertaking proffered by BUPA [the employer] met the requirements relating to the signing of undertakings prescribed by the Fair Work Regulations 2009;

(c) seek the views of each of the bargaining representatives of which he was aware on any written undertaking proffered by BUPA [the employer] which met the signing requirements in the regulations;

(d) consider whether he was satisfied that Fair Work Australia accepting the written undertaking was not likely to cause financial detriment to any employee covered by the BUPA Agreement or result in substantial changes to the [BUPA] Agreement;

(e) consider whether he [Fair Work Australia] was satisfied the written undertaking met his concern about the BUPA Agreement not passing the “no-disadvantage test”; and

(f) then decide whether to approve the [BUPA] Agreement under s.186.” 9

[10] Having regard to the guidance of the Full Bench in the decisions referred to above, I decided that in light of the report received on 17 September 2010 in relation to the operation of the terms of the Agreement, I should permit the applicant the opportunity to make submissions concerning whether the Agreement passed the better off overall test. On the 22 September 2010, I wrote to the applicant expressing my concerns regarding the application of the better off overall test to the terms of the Agreement. I stated that, on the basis of the research undertaken by the Enterprise Agreements Unit, I was concerned that the Agreement did not pass the better off overall test. I provided a copy of the report prepared by the Enterprise Agreements Unit to the applicant and invited submissions which might persuade me that the Agreement passed the better off overall test.

[11] There then commenced an exchange of submissions by the applicant and further analysis by the Tribunal directed, first to whether or not the calculations which gave rise to the concerns expressed in my letter of 22 September 2010 were correct, and later in relation to a series of proposed undertakings under s.190 of the Act, which were subsequently and progressively submitted by the applicant.

[12] On 30 September 2010 the applicant submitted that the analysis which led to my concerns as expressed on 22 September 2010 was incorrect and submitted a table referring to something described as the “actual average rostered hours” of work under the Agreement. No undertakings were offered at that time in light of the Tribunal’s concerns as reflected in the correspondence and the report.

[13] The information and submissions provided by the applicant on 30 September 2010 were referred to Fair Work Australia’s Enterprise Agreement Unit and a response was prepared and forwarded to the applicant on 7 October 2010.

[14] The response concluded that using the applicant’s information and analysing the effect of the terms of the Agreement and considering the “actual averaged rostered hours” concept advanced by the applicant, nevertheless, the Agreement did not pass the better off overall test.

[15] On 18 October 2010 the applicant conceded that the Agreement did not pass the better off overall test and sought to have the Agreement approved with undertakings.

[16] The undertakings proposed, at that time, provided for increases to most of the flat hourly rates prescribed by the terms of the Agreement, and that the applicant would not “refer to or rely on or apply the terms of clause 12(h) ‘Voluntary Additional Hours’ of the Agreement”.

[17] The Tribunal then conducted analysis of the terms of the Agreement in light of those undertakings, which were later expanded to include other proposed undertakings which will be addressed further below. Following the procedure indicated by the decisions of the Full Bench referred to above this exchange culminated on Friday 12 November.

The better off overall test

[18] For the Agreement to be approved by Fair Work Australia, the Tribunal must be satisfied that the Agreement passes the better off overall test. 10 The better off overall test requires that at the “test time”11, each award covered employee, and each prospective award covered employee for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.12

[19] The application for approval of the Agreement states that 10 employees would be covered by the Agreement 13 and that those employees are all the employees of the employer.

[20] The application lists the Award as the instrument which covers and applies to the employer and employees to whom the agreement will apply. There is therefore no issue that the reference instrument for the purposes of the application of the better off overall test is the Award 14.

[21] It is appropriate to commence consideration of whether or not the Tribunal can be satisfied that the Agreement passes the better off overall test with some observations of and about the terms of the Agreement and then to address the effect of those terms in conjunction with the series of undertakings progressively proposed in the submissions of the applicant between 18 October 2010 and 12 November 2010.

[22] Clause 2 of the Agreement is as follows:

“Clause 2. INCIDENCE AND PARTIES BOUND

This Agreement will be binding upon the “employer” National Protection Group Australia A.C.N 131 330 508, located at Unit 15, 191 Parramatta Road, Auburn and all the “employees” who are employed by the “employer” in the classifications as set out in Clause 10 of this Agreement. Further it is the intention of the parties, that this Agreement will apply both to the State of New South Wales and to all other States and Territories of the Commonwealth, should work commitments necessitate interstate coverage.

Nothing in this Agreement shall prevent the “employer” and the “employees” covered by this Agreement from entering into a further Enterprise Agreement in accordance with the Fair Work Act 2009 (Cth). It is acknowledged and agreed by the parties, that any Agreement made subsequent to the signing of this Agreement, to the extent of any other inconsistency will regulate the “employees” terms and conditions of employment.

The Consultative Mechanism shall be the agreed representative of all employees covered by this Agreement.

It is the intention of the parties, that this Agreement to the extent permitted by law will regulate the terms and conditions of employment of all the “employees” as cited in Clause 10 of this Agreement, to the exclusion of any Award or Industrial Agreement.

The Parties Agree that the provisions of the Fair Work Act 2009 (Cth) will apply in relation to the following Clauses of the Agreement.

(i)	Clause 3.2	Transfer of Business	(Section 312)
(ii)	Clause 8	Termination of Employment	(Section 117)
(iii)	Clause 8.2	Redundancy	(Section 119)
(iv)	Clause 9	Dispute Settlement Procedures	(Section 738)
(v)	Clause 13.4	Maternity Leave	(Section*69)
(vi)	Clause 13.5	Paternity Leave	(Section*70)
(vii)	Clause 13.6	Adoption Leave	Section*68)

(original emphasis)

[23] For the purposes of the operation of the terms of the Agreement the types of employee are defined in a TABLE OF DEFINITIONS as follows:

““Employer” The registered business identified in Clause 2 - Incidence & Parties Bound of this Agreement

“Employee” A person who is hired to perform work for the registered business identified in Clause 2 - Incidence & Parties Bound of this Agreement

“Enterprise” The business that is operated by the Employer

“Consultative Mechanism” The consultative process by which the employer and Employee(s) meet to discuss and exchange view, that will assist the Enterprise in becoming more productive and efficient

“Parties” The Employer and each Employee who is engaged under this Enterprise Agreement

“Agreement” This Enterprise Agreement which was formulated through a consultative process establishing the terms and conditions of employment within the Enterprise

“Contract of Employment” The common law and employer/employee relationship between the Employer and the Employee

“Ordinary Time” The regularly worked hours of an Employee in the performance of their duties

“Ordinary Time Earnings” The amount paid to an Employee for working regularly worked hours

“Continuous Service” An unbroken period of employment between the Employer and the Employee which includes periods of authorised leave

“Full-time Employee” An Employee who works 38 hours per week

“Permanent Part-time Employee” An Employee who is engaged in accordance with Clause 12(b) of this Agreement and is guaranteed that each shift will consist of not less than 4 hours and not more than 13 hours in duration

“Casual Employee” An Employee who is engaged by the Employer on a needs basis, without any guarantee as to the number of shifts or days of their employment, or whose Letter of Employment Defines the Employee as a Casual

“Independant Contractor” Refers to an individual within the meaning of the Independent Contractors Act (Cth) 2006, who is engaged and paid by the Employer under a contract of service, to supplement the workforce on a needs basis.

“Guard” Refers to the duties associated with the watching, guarding or protecting of property and maintaining order in accordance with the rules of the Security Industry Act (N.S.W.) 1997

“Patrol Officer” Refers to the duties associated with the monitoring, securing, watching and guarding of any public place by way or random patrolling in accordance with the Security Industry Act (N.S.W.) 1997

“Administration and General” Refers to the clerical and administrative duties within the organisation

“Junior” A person under the age of twenty (20) years, who performs work for an employer

“Apprentice” A person who undertakes training with an employer under a contract of training in accordance with the Vocational Education Training Act 1990

“Trainee” A person who undertakes training with an employer for a period of twelve (12) months in accordance with an Australian Traineeship Scheme”

[24] It will be noted that by virtue of the definition of a Permanent Part-time Employee in the table of definitions and the terms of clause 2 of the Agreement, the provisions of clause 10 of the Award have no application. Having regard to the effect of the terms of the Agreement, the exclusion of the operation of the terms of clause 10.4 ‘Part-time employees’ of the Award has particular effect. For the purposes of the operation of the terms of the Agreement a Permanent Part-time Employee is not an employee who “is engaged to work fewer than 38 ordinary hours per week”.

[25] Rather, the effect of the terms of the Agreement is that a Permanent Part-time Employee may be engaged to work up to 13 hours on any day. No limit on the number of hours of work of Permanent Part-time employees other than this is prescribed by the Agreement and the days upon which such number of hours may be worked is only constrained by the provisions of Clause 12 ‘Hours of work’ of the Agreement, which is set out below:

“Clause 12. HOURS OF WORK

The “EMPLOYER” IN ACCORDANCE WITH Part 2 - 2—Section 62—Maximum Weekly Hours - of the Fair Work Act 2009 (Cth), will develop flexible working arrangements, subject to the needs and requirements of the Enterprise the “employees” will be rostered to work the following hours of work:

(a) Full time “employeer” will be required to work a total of 38 hours plus reasonable additional hours in any weekly cycle. No full time “employee” will be required to work less than 4 hours or more than 12 hours on any given day. “Employees” will be entitled to 2 rostered days off per weekly cycle. By agreement between the parties, the “employee” may be required to work additional shifts. In such circumstances, the “employee” will not work more than 10 days in succession without a day off.

(b) Permanent Part-time “employees” will be guaranteed that each shift will consist of not less than 4 hours and not more than 13 hours in duration. Permanent part-time employees” will be entitled to the provisions of this Agreement on a pro rata basis, including 2 rostered days off per weekly cycle.

(c) In accordance with this Clause, the Enterprise will develop variable rosters covering all hours in which the Enterprise operates. Such rosters will be arranged on a weekly basis, and will be confirmed by the “employee” contacting the “employer” or as advised by the Operations Manager.

(d) If due to extenuating circumstances the “employer” requires an “employee” to work in excess of 7 days in succession, subject to mutual consent between the parties, the “employees” roster may be altered to provide the shift worked does not increase the number of days worked to in excess of 10 days in succession.

(e) If the “employer” requires an “employee” to work on their rostered day off, provided the “employee” will not have worked 10 days in succession and the “employee” agrees to such a request, the “employer” will pay the “employee” ordinary time for all time worked and another day off in lieu without loss of wages. A shirt swap with another “employee” or any additional shift worked at the “employees” request, will not be regulated by the provisions of this clause.

(f) Casual “employees” will be engaged by the “employer” on a needs bases. Casual “employees” will be entitled to the same terms and conditions of employment under this Agreement, except for Clause 13 and Clause 14 of this Agreement.

(g) Independent Contractors may be engaged by the “employer” under a contract of service, to supplement the workforce on a needs basis.

(h) Voluntary Additional Hours, are hours worked outside on an “employee’s” ordinary hours, and are offered to an “employee” on a needs basis. An “employee” who elects to work such additional hours, does so voluntarily and is requires to complete the Voluntary Additional Hours form attached to this agreement. By signing the form, the “employee” accepts they are available to work any reasonable additional hours offered by the “employer”, however the “employee” may request to work such additional hours should pressing and personal circumstances prevent their availability.

12.1 MEAL BREAK The Meal/Rest Break clause which appears in the Award, is specifically excluded from this Agreement, and replaced with the following provisions regarding the taking of meal breaks:

(a) The accommodate “employee” Meal/Rest Breads the “employer will permit “employee’s” to take such authorised breaks subject to the needs and operational requirements of the organisation including rostering arrangements,

(b) The “employee” prior to taking a Meal/Rest Break, will advise their team leader in order to avoid interruption to the organisation services,

(c) The “employer” will not employee any “employee”, nor will an “employee” be required to work, for the duration of their rostered shift without an interval for an authorised Meal/Rest Break.

[26] The provisions of the Award governing Meal Breaks and Meal Allowances are more extensive and more beneficial to the employees whose employment is covered by the Award than the above terms of the Agreement.

12.2 OVERTIME

(a) The Overtime clause, which appears in the Award, is specifically excluded from this Agreement, and replaced with the following provisions. Where a relevant “employee” has established their rostered hours of work with the “employer” in accordance with Clause 12 of this Agreement, and the “employer” has authorised the “employee” to work beyond the completion of their rostered shift, then the “employee” will be entitled to be paid overtime for all time worked continuous with completion of their rostered shift.

(b) Overtime shall be paid at the “employee’s” ordinary hourly rate of pay according to their Skill and Salary Classification level. Where overtime has been worked in accordance with sub-clause (a), for the purposes of calculation, the weekly rostered hours shall commence upon the “employee” initial weekly engagement. A shift swap with another “employee” or any additional shift worked at the “employee’s” request, will not be regulated by the provisions of this clause.

(c) A record of all time worked will be kept by the “employer” in accordance with Industrial Regulations - Part 3 - 6, Division 3 - Employee Records - of the Fair Work Act 2009 (Cth).”

[27] It should be noted that under the terms of the Agreement all “overtime” is paid for at the flat hourly rates prescribed by the terms of the Agreement. The overtime provisions of the Award are substantially more beneficial to employees whose employment is covered by the Award.

[28] Clause 4.1 of the Agreement is as follows:

“SAVINGS CLAUSE No “employee shall suffer a reduction in entitlement to ordinary time earnings, when the rate they shall receive for ordinary time pursuant to this agreement is compared to their ordinary time earnings as calculated under The Security Services Industry Award 2010, in accordance with Section 206 - Base Rate of Pay Under Enterprise Agreements - of the Fair Work Act 2009 (Cth).

[29] Clause 5 of the Agreement includes the following in addition to the other terms:

“Subject to the successful completion of a three-month probation period, all full time and part-time employees shall be employed in accordance with Clause 12 - Hours of Work - of this Agreement. At the time of engagement, the “employer” will inform each “employee” as to the terms of their employment by way of a letter of appointment in accordance with Part 2 - 2 National Employment Standards - of the Fair Work Act 2009 (Cth), and whether the “employee” is to be full time or part-time. Where Casual employees are hired, they will by entitled to the same terms and conditions of employment under this Agreement, except for Clause 13 and Clause 14 of this Agreement. The provisions of this Agreement will have no force or effect upon those persons who are engaged as Independent Contractors within the meaning of the Independent Contractors Act (Cth) 2006.”

[30] Clause 10 of the Agreement, as filed, sets out the wage rates applicable to the classifications of work provided and includes a table of those wage rates. Table 1 below shows the wage rates which were included in the Agreement at the time of the application. Table 2 shows the wage rates which would be prescribed as a result of undertakings proposed by the applicant at the time of this decision.

Table 1

CLASSIFICATION

JUNE 2010

WEEKDAY/WEEKEND

JUNE 2011

WEEKDAY/WEEKEND

JUNE 2012

WEEKDAY/WEEKEND

JUNE 2013

WEEKDAY/WEEKEND

LEVEL 1 FULL/PART-TIME

CASUAL

$18.00 - $22.00

$21.10 - $25.85

$18.75 - $22.90

$22.95 - $26.90

$19.45 - $23.80

$22.85 - $27.95

$20.25 - $24.75

$23.75 - $29.10

LEVEL 2 FULL/PART-TIME

CASUAL

$18.50 - $22.50

$22.05 - $26.80

$19.25 - $23.40

$22.95 - $27.90

$20.00 - $23.80

$23.85 - $29.00

$20.80 - $25.30

$24.80 - $30.15

LEVEL 3 FULL/PART-TIME

CASUAL

$19.00 - $23.00

$23.00 - $27.75

$19.75 - $23.95

$23.95 - $28.85

$20.55 - $24.90

$24.90 - $30.00

$21.40 - $25.90

$25.90 - $31.20

LEVEL 4 FULL/PART-TIME

CASUAL

$19.50 - $23.50

$23.95 - $28.70

$20.30 - $24.45

$24.90 - $29.85

$21.10 - $25.40

$25.90 - $31.05

$21.95 - $26.45

$26.95 - $32.30

Table 2

CLASSIFICATION

JUNE 2010

WEEKDAY/WEEKEND

JUNE 2011

WEEKDAY/WEEKEND

JUNE 2012

WEEKDAY/WEEKEND

JUNE 2013

WEEKDAY/WEEKEND

LEVEL 1 FULL/PART-TIME

CASUAL

$18.50 - $23.50

$22.20 - $29.95

$18.75 - $23.95

$22.65 - $30.55

$19.45 - $24.45

$23.10 - $31.15

$20.25 - $24.95

$23.75 - $31.80

LEVEL 2 FULL/PART-TIME

CASUAL

$19.50 - $24.50

$23.20 - $30.95

$19.90 - $25.00

$23.65 - $31.55

$20.30 - $25.50

$24.15 - $32.20

$20.80 - $26.00

$24.80 - $32.85

LEVEL 3 FULL/PART-TIME

CASUAL

$20.50 - $25.50

$24.20 - $31.95

$20.90 - $26.00

$24.70 - $32.60

$21.35 - $26.55

$25.20 - $33.25

$21.75 - $27.05

$25.90 - $33.90

LEVEL 4 FULL/PART-TIME

CASUAL

$21.50 - $26.50

$25.20 - $32.95

$20.90 - $27.05

$25.80 - $33.60

$22.35 - $27.60

$26.20 - $34.30

$22.80 - $28.15

$26.95 - $34.95

[31] Clause 10 includes junior rates of pay and rates of pay for Trainees as follows:

“10.2 JUNIOR EMPLOYEES (other than office juniors) The rate of pay for junior employees shall be as follows, based upon Level 1 of the Skills and Salary classification for the work performed.

AGE	%
17 years of age and under	70
18 years of age	80
19 years of age	90
20 years of age	100

10.3 JUNIOR OFFICE EMPLOYEES The rate of pay for junior office employees shall be as follows, based upon Level 1 of the skills and Salary Classification for the work performed.

AGE	%
15 years of age and under	50
16 years of age	60
17 years of age	70
18 years of age	80
19 years of age	90
20 years of age	100

[32] It may be noted that the Award does not provide for Junior Employee rates of pay. The subject of the Junior Employee classifications and rates of pay prescribed by the Agreement are subject to a proposed undertaking which is considered in this decision.

[33] Clause 10.5 of the Agreement deals with what can be described as higher duties provisions such that an employee will receive payment at the higher rate of pay when performing duties of an employee of a higher classification when an employee performs the higher duties for not less than 5 days. The Award provides that when an employee performs work for which a higher rate is fixed the employee will receive the higher rate, if the work exceeds four hours of a day, for the remainder or the shift and work on that day 15.

[34] Clause 12 is of some importance and is in the following terms:

“CLAUSE 12. HOURS OF WORK

The “employer in accordance with Part 2-2 - Section 62 - Maximum Weekly Hours - of the Fair Work Act 2009 (Cth), will develop flexible working arrangements, subject to the needs and requirements of the Enterprise the “employees” will be rostered to work the following hours of work:

(a) Full time “employee” will be required to work a total of 38 hours plus reasonable additional hours in any weekly cycle. No full time “employee” will be required to work less than 4 hours or more than 12 hours on any given day. “Employees” will be entitled to 2 rostered days off per weekly cycle. By agreement between the parties, the “employee” may be requested to work additional shifts. In such circumstances, the “employee” will not work more than 10 days in succession without a day off.

(b) Permanent Part-time “employees” will be guaranteed that each shift will consist of not less than 4 hours and not more than 13 hours in duration. Permanent part-time “employees” will be entitled to the provisions of this Agreement on a pro rata basis, including 2 rostered days off per weekly cycle.

(d) If due to extenuating circumstances the “employer” requires an “employee” to work in excess of 7 days in succession, subject to mutual consent between the parties, the “employees” roster may be altered provided the shift worked does not increase the number of days worked to in excess of 10 days in succession.

(e) If the “employer” requires and “employee” to work on their rostered day off, provided the “employee” will not have worked 10 days in succession and the “employee” agrees to such a request, the “employer” will pay the “employee” ordinary time for all time worked and another day off in lieu without loss of wages. A shift swap with another “employee” or any additional shift worked at the “employee” request, will not be regulated by the provisions of this clause.

(f) Casual “employees” will be engaged by the “employer” on a needs basis. Casual “employees” will be entitled to the same terms and conditions of employment under this Agreement, except for Clause 13 and Clause 14 of this Agreement.

(g) Independent Contractors may be engaged by the “employer” under a contract of service, to supplement the workforce on a needs basis.

(h) Voluntary Additional Hours, are hours worked outside of an “employee’s” ordinary hours, and are offered to an “employee” on a needs basis. An “employee” who elects to work such additional hours, does so voluntarily and is required to complete the Voluntary Additional Hours form attached to this Agreement. By signing the form, the “employee” accepts they are available to work any reasonable additional hours offered by the “employer”, however the “employee” may refuse to work such additional hours should pressing and personal circumstances prevent their availability.”

[35] It may be noted that the terms of the Agreement provide that an employee is not to be required to work more than 10 days in succession. However, if an employee were to work in excess of 10 consecutive days no penalty or higher rate of pay would apply to such work, rather the flat hourly rates of pay prescribed by the terms of the Agreement would apply.

[36] Clause 13 provides for annual leave as follows:

“Clause 13. LEAVE ENTITLEMENTS

13.1 ANNUAL LEAVE The Annual Leave loading clause which appears in the Award, is specifically excluded from this Agreement, and replaced with the following provisions regarding the taking of Annual Leave. A relevant “employee” who has been in the continuous service of the “employer” for a period of 12 months, will be granted four weeks paid annual leave to compensate for the hours of duty which involved shift work. The taking of Annual Leave by the “employee” will at all time, be subject to the need and operational requirements of the organisation.

Subject to mutual agreement between the “employer” and the “employee” pro rata leave may be taken prior to the completion of the 12 month period. Any annual leave not taken by the “employee” in any one year, may be taken as wages pursuant to Section 94 - Entitlements to cash out Annual Leave - of the Fair Work Act 2009 (Cth), subject to mutual agreement with the “employer”.

If during the “employees” first twelve months of service (including the probation period) they should leave their employment, or their services are terminated by the “employer”, the “employee” shall be paid pro rata leave at the rate of 1/12th of four weeks at their current ordinary time rate for each completed month of continuous service with the “employer”.

It is a condition of taking annual leave, due to the operational needs and requirements of the organisation, no “employee” will be permitted to take such leave during the month of December.”

[37] Clause 14 deals with public holidays and is set out below:

“Clause 14. PUBLIC HOLIDAYS

Pursuant to Division 10 - Public Holidays of the Fair Work Act 2009 (Cth), the parties to this Agreement will observe the Banks Holidays Act 1912 (N.S.W.), for each classification level at the “employees” ordinary hourly rate of pay.

New Years Day Labour Day Easter Monday Christmas Day

Australia Day ANZAC Day Queen’s Birthday Boxing Day

Additional Holiday Good Friday Bank Holiday

The Pubic Holiday clause which appears in the Award, is specifically excluded from this Agreement, and replaced with the following provisions regarding the taking of Public Holidays.

The following will apply to a full-time or part-time “employee”, who’s rostered shift coincides with a Public Holiday. The “employee” will receive the relevant hourly rate for the time worked, plus one ordinary days pay for the Public Holiday.

CLASSIFICATION	JUNE 2010 HOLIDAY RATE	JUNE 2010 HOLIDAY RATE	JUNE 2010 HOLIDAY RATE	JUNE 2010 HOLIDAY RATE
LEVEL 1 FULL/PART-TIME CASUAL	$26.00 $27.55	$27.05 $28.65	$28.15 $29.80	$29.25 $31.00
LEVEL 2 FULL/PART-TIME CASUAL	$26.50 $28.05	$27.55 $29.20	$28.65 $30.35	$29.80 $31.55
LEVEL 3 FULL/PART-TIME CASUAL	$27.00 $28.50	$28.10 $29.65	$29.20 $30.85	$30.40 $32.05
LEVEL 4 FULL/PART-TIME CASUAL	$27.50 $29.00	$28.60 $30.15	$29.75 $31.35	$30.95 $32.65

[38] The hourly rate of pay for a Level 1 full-time or part-time employee working on a public holiday under the Award at the “test time” is $42.13 and for a casual employee is $46.34. Moreover, the terms of the Agreement do not prescribe what constitutes a “day’s pay”, an “ordinary days pay” or some other quantification of the relevant payment in addition to the flat hourly rate of pay for work performed on public holidays.

[39] A primary matter of concern which arose in relation to the Agreement was identified in the letter to the applicant of 22 September 2010, which enclosed a quantitative comparative analysis of the terms of the Agreement and the terms of the Award, concerning the rates of pay prescribed for certain rosters of work by each instrument. At this time, it was clear the Agreement failed the better off overall test due to the inferiority of the flat rates of pay prescribed by the terms of the Agreement when compared with the appropriate rates of pay prescribed by the various provisions of the Award for those rosters of work.

[40] Initially, the applicant did not readily accept the information provided by the Tribunal and made submissions concerning the calculations upon which the advice of 22 September 2010 that the Agreement did not pass the better off overall test was based. Further information and advice was provided to the applicant in response to those points of difference. In the course of this exchange, it became apparent that the applicant believed that the rates of pay prescribed by the Agreement should be compared with the rates of pay prescribed by the Award applicable prior to 1 July 2010, the date upon which the rates of pay prescribed by the Award increased as a result of the Annual Wage Review 2009-2010 16. The position advanced in the applicant’s submissions in this respect was misconceived when the effect of the relevant statutory provisions concerning the “test time”17 were properly considered having regard to the fact that the application stated that the Agreement was “made” on 2 July 201018.

[41] This was acknowledged by the applicant on 18 October 2010. The applicant then proposed, in submissions of that date, that it would give an undertaking to increase the flat hourly rates prescribed by the Agreement and also that the Voluntary Additional Hours provisions of the Agreement would be addressed by an undertaking that the employer would not “refer to rely on or apply” clause 12(h)– Voluntary Additional Hours of the Agreement.

[42] In light of the undertakings proposing increases to the flat hourly rates and in relation to the Voluntary Additional Hours provisions of the Agreement in the applicant’s Submissions of 18 October 2010, it was necessary to apply the better off overall test as if those undertakings formed terms of the Agreement, and to address the effect of the form of the undertakings proposed.

[43] Revised calculations based on the undertakings proposed and a further application of the better off overall test in light of the undertakings was the subject of a report prepared by the Fair Work Australia Enterprise Agreement Unit accordingly, which was sent to the applicant on 22 October 2010 in reply to the letter of 18 October 2010. Some key issues, among others were identified in that report as follows:

“Key Issues

... we note that there are some issues that remain with the agreement and the proposed undertakings:

The undertakings contain a new wage rate table that increases the majority of the rates of pay but not all; there are decreases most notably in the 5th column (the last wage increase) of the wage rates table where level 1 and 2 employees have had all weekday rates reduced from what was proposed in the agreement. For example, the agreement level 1 full time weekday rate of pay in the agreement is $18 at time of lodgement and by the end of the agreement is $20.25 a difference of 12.5%. The proposed undertaking changes the level 1 weekday rate to $18.50 but by the end of the agreement this rate would be $19.65 a difference of 6.21%. Our concern is that the employees would’ve voted on the rates of pay in the agreement and not those proposed in the undertakings which will reduce the agreements weekday rates for level 1 and 2 employees at the last of the agreements pay increases (in 2013).

The undertaking is based on the applicant’s average hours, included for the Commissioners reference is the proposed average of hours from the applicant (below table). It is noted that the terms of the agreement allow for different work patterns than the one listed below to be worked by employees, and most notably our concern would be for part time or casual employees who are required to work predominantly on the weekends.

The applicant has provided average weekly hours that their calculations are based on, the modern award allows for hours to be averaged over a roster cycle of no more than eight weeks, it is unclear over what roster length the applicants average is calculated. Also, the agreement leaves employees disadvantaged in terms of overtime penalties, while the proposed undertaking removes the voluntary additional hour’s clause, the agreement would continue to pay employer authorised overtime at the employee’s ordinary rate of pay (clause 12.2 b) this is a reduction when compared to the Modern award (150% Mon - Sat first 2 hours, 200% thereafter & Sun 200% all hours).

Applicants proposed average weekly hours

Shift	% of hours per week	38 hour week
Weekday average hours	76.39%	29.1 hours
Weekday 6pm to 6am	6.94%	2.6 hours
Saturday average	10%	3.8 hours
Sunday average	6.67%	2.5 hours
Total	100%	38 hours”

[44] As of 22 October 2010, it was clear and the applicant was aware that, even with the undertakings proposed in the letter of 18 October 2010, Fair Work Australia was concerned that the Agreement did not pass the better off overall test.

[45] The report, forwarded to the applicant on 22 October 2010 considered in full, in my view, is such that the Agreement could not have been approved with the undertakings of 18 October 2010 even if what I consider to be a problem of the form of the proposed undertakings dealing with the operation of the Voluntary Additional Hours terms at Clause 12(h) of the Agreement, and others, which will be dealt with further below, could have been remedied.

[46] On 3 November 2010, the applicant made further submissions and additional undertakings were proposed as follows: the applicant will not refer to or rely upon clause 10.2 ‘Junior Employees’; clause 10.3 ‘Junior office employees’; clause 10.4 ‘Traineeships’; clause 12.2 ‘Overtime’; and that no employee will work predominantly on weekends and that rosters of work would ensure that this did not occur. In addition, the applicant addressed the issue of the reduction in the flat rates of pay originally prescribed by the terms of the Agreement to operate from June 2013 which was identified in the analysis of the applicant’s undertakings of 22 October 2010 which is referred to under the heading of “Key Issues” in the extract shown above.

Hours of work–the “better off overall” test–rosters

[47] In order to be satisfied that each employee who would be covered by the Agreement would be better off if employed under its terms and the proposed undertakings rather than if employed under the terms of the Award, it is necessary to compare what the terms of each instrument and any relevant undertaking would permit and measure the comparative effects on employees.

[48] Inherent in the application of the better off overall test to the terms of the Agreement when compared to the terms of the Award is the necessity to consider the terms of the Agreement and the Award as they apply to the hours of work and the payment applicable for those hours under the respective instruments. The terms of each instrument have different effects on the entitlements of employees depending upon the duration of the shifts and the times when the hours of work are performed. The issue of concern in relation to the Voluntary Additional Hours provision of the Agreement was embedded in such considerations.

[49] In this respect, three things are relevant to this application. The first is what the terms of the Agreement permit, in light of any proposed undertakings, in particular as applicable to the rostering of the hours of work. The second is what employees will receive for any roster of work permitted by the terms of the Agreement and relevant undertakings. The third is what an employee would receive for hours of work rostered in accordance with the terms of the Agreement and relevant undertakings if the terms of the reference instrument applied to such hours of work.

[50] The applicant has taken great issue with the approach of the tribunal to the analysis referred to above. The applicant has referred to “average rosters” and “actual rosters” and criticised comparative scenarios developed within Fair Work Australia of the effects of various rosters of work permissible under the terms of the Agreement with those of the Award as “fictitious rosters”.

[51] It is necessary to reject the submissions of the applicant in this respect. Before proceeding to address the conceptual issues arising, however, it is appropriate in passing to note that this issue has been on notice to the applicant since the initial report of 22 September 2010, as can be gleaned from the submissions subsequently made by the applicant.

[52] As late as 4 November 2010, attempts to facilitate the approval of the Agreement with undertakings by Fair Work Australia, which would resolve the difference in approach of the applicant and the Tribunal to the application of the “better off overall test” were made by the Tribunal in a letter of that date which includes the following:

“However, before proceeding to finally determine the application, it is appropriate to make some observations arising from your letter of 3 November 2010. The first concerns the rostering of work permitted by the terms of the Agreement.

I have already noted that the terms of the Agreement are to be assessed against the terms of the reference instrument. The operational intentions of the employer do not modify the effect of the terms of an agreement, without undertakings. Therefore, subject to any specific undertaking in relation to the limitation of rostered hours of work, Fair Work Australia must make an assessment of what the terms of the Agreement permit against those of the reference instrument.

In your correspondence you have referred to an ‘average roster cycle’ and rosters ‘which are presently in place’. I gather that you suggest that the rosters submitted are the only rosters which need be considered for the purposes of the better off overall test. It would assist me if you could advise if the average roster cycle submitted for assessment by Fair Work Australia actually constitutes the roster which is presently in place. If that were the case then the assessment of the terms of the Agreement against the terms of the reference instrument could proceed accordingly. The implication would be that the employer would give an undertaking that the rosters which are presently in place would be the only rosters to which the terms of the Agreement would apply. This would avoid the necessity to consider how the Agreement would operate in relation to any other rosters which appear to be permitted by its terms. Moreover, this would have implications for other aspects of the approval of the Agreement with the undertakings proposed.”

[53] The applicant responded to the letter of 4 November 2010 on 12 November 2010. The actual rosters of work were not submitted. No undertaking was offered concerning the rosters which would be worked under the terms of the Agreement in that response. In the absence of any such undertaking the application of the better off overall test must be applied such that each employee or a prospective employee must be better off under the rosters of work permitted by the terms of the Agreement and the undertakings, as proposed, than if the employee performed that work under the terms of the reference instrument.

[54] At the heart of the issue agitated by the applicant in this respect appears to be a misconception concerning the application of the better off overall test and a confusion in the language of the applicant’s communication between what the terms of the Agreement permit, the operational intentions of the employer in respect of such terms and what seems to be a statistical extrapolation referred to by the applicant as “average hours”, an “average roster cycle” or “actual average roster cycle”, to which I will return below.

[55] In the case of BUPA, the Full Bench addressed the application of the no-disadvantage test for the purposes of approval of workplace agreements under the Workplace Relations Act 1996 as follows:

“We consider the views of the majority in the Security Officers case are apposite to the appeal before us. Where there is a relevant reference instrument, the application of the “no-disadvantage test” requires a comparison of the terms and conditions of employment in the enterprise agreement against the terms and conditions of employment in any relevant reference instrument and an assessment of whether the terms and conditions in the enterprise agreement result, on balance, in a reduction in the overall terms and conditions of employment under any relevant reference instrument. The “no-disadvantage test” does not involve an analysis of matters other than the terms and conditions of the enterprise agreement against those in any relevant reference instrument. The effect the terms and conditions may have on the actions of an employer or employee is not relevant to the “no-disadvantage test”. The requirement in item 10(1)(a) of Schedule 7 of the Transitional Act for Fair Work Australia to have regard to the work obligations of the employee or employees under the enterprise agreement in deciding whether an enterprise agreement passes, or does not pass, the “no-disadvantage test” does not alter our views about the application of the “no-disadvantage test”. After all, it is the terms and conditions of employment in the enterprise agreement that determine the work obligations under the enterprise agreement.”

[56] While the decision referred to above concerned the application of the no disadvantage test prescribed in relation to the approval of workplace agreements under the Workplace Relations Act 1996, I consider the reasoning should be applied equally to the application of the better off overall test under the Fair Work Act 2009.

[57] Having regard to the approach of the Full Bench above, whatever the operational intention of the employer in this case may be, in the absence of any undertaking in relation to the rostering of hours of work, the comparison must be the terms of the Agreement and the terms of the Award. So much has been made clear to the applicant. On such a comparison, on the material and proposed undertakings before me, I cannot be satisfied that each employee who would be engaged under the terms of the Agreement will be better off overall than if they were employed under the terms of the Award for reasons which will be further expressed below.

[58] On 30 September, the applicant stated that the “applicant made his agreement with the employees” upon certain rostered hours. The details of this dimension of the Agreement were not provided. In the part of the submission of that date, under the heading “Summary and Conclusion”, the applicant complained that it was not contacted to provide “actual or average rostered hours” prior to 22 September 2010. Presumably, the two concepts are distinct. Clearly, the applicant has since been given ample opportunity to provide the “actual rostered hours” upon which the agreement was made with the employees and to undertake that such rostered hours would be the hours of work to which the terms of the agreement would apply so as to enable the application of the better off overall test appropriately thereto. The applicant must be taken to have declined that opportunity and invitation. Moreover, it is difficult to understand the concept of “average rostered hours” or “actual average rostered hours” referred to in the applicant’s submissions. This concept first appeared in the applicant’s submissions of 30 September 2010.

[59] It will be noted that in addition to an apparent distinction between “actual rostered hours” and “average rostered hours” or “average hours” referred to in the applicant’s various submissions, there appears to be a conflation of the concepts such that, as extracted from the applicant’s submissions, the table below is said to represent “the actual average rostered hours”:

“Hours of work modelling response

The next matter relates to the projected rostered hours of the organisation at the time the agreement was made with the employees. As stated by “the EAU” in their resport, “We are unsure what might represent usual work patterns for employees under this agreement and have therefore modelled on a range of scenarios that could be worked under the agreement.” We would say for the “EAU” to prepare such scenarios without having receipt of the actual roster details have voided the financial benefits of the Agreement.

The applicant would say all their calculations have been based upon a total of 360 rostered hours per week, and itemised as follows:

Weekday average hours	275.00 - 76.39%
Weekday 6pm/6am hours	25.00 - 6.94%
Saturday average hours	36.00 - 10.00%
Sunday average hours	24.00 - 6.67%
*Total Average Hours*	360.00 - 100.00%

[60] Clearly, it should not be considered that each employee whose employment is covered by the Agreement will work 275 hours between Monday and Friday or a total of 360 hours in a week. In attempting to consider the meaning of the applicant’s submissions as best I am able I can only conclude that the table above does not represent the actual rosters of work of an individual employee identified in the materials supporting the application but an extrapolation to some kind of an “average” of “a total” number of hours of work which could or may be rostered under the relevant terms of the Agreement. On what is before me, I must conclude that this “total” average hours of work represents some sort of arithmetically based representation of rosters of 360 hours of work by employees.

[61] Even if this information were a valid basis upon which to apply the better off overall test, it is not possible to test the construction of this “average” as the information necessary to do so is not provided. The “actual” rosters of work permissible by the terms of the Agreement to be worked by the employees covered by the terms of the Agreement and according to the employer’s operational intentions, and the applicable payments under the terms of the Agreement, and the undertakings as proposed, are not provided.

[62] Moreover, whatever the operational intention of the applicant may be in implementing the terms of the Agreement, in the absence of undertakings to confine the terms of the Agreement to the specified rostered hours of work said to have been agreed by the empoyees, the terms of the Agreement do not confine the employer in any way as to the day upon which the hours of work provided for by the terms of the Agreement will be performed or the time of day upon which the hours of work may be performed, other than in accordance with the express terms of the Agreement, and a proposed undertaking in relation to weekend work. The hours of work may be worked at any time of day and on any day of the week up to 12, or 13 in the case of a permanent part-time employee, and be spread over a period of up to 10 consecutive days. Moreover, the Agreement does not provide for any penalty or overtime rate above the flat hourly rates applicable for work beyond 10 consecutive days were that to occur.

[63] In my view, the table above cannot be usefully applied for the purpose of the better off overall test. Without greater explanation it would seem that the table refers to the hours of work, 360, to be worked by all the 10 employees or at least some of them or portrays some combination of the 10 employees referred to in the applicant’s supporting materials and other persons who might be employed under the terms of the Agreement. The table involves a calculation which is inherently abstract and which is foreign to the underlying conceptual basis of the better off overall test. The Agreement must pass the better off overall test in relation to each existing or prospective employee who performs work under the terms permissible by the Agreement. The test is not whether over any given period the employees, looked at as a whole, will, on average, be better off overall according to an “average” abstracted from the unspecified operational intentions of the employer, regardless of the effect of the terms of the Agreement unconstrained by any undertaking in relation to such operational intentions.

[64] While it is noted that the calculations of the applicant expressed in their submissions of 30 September 2010 were based on the original wage rates prior to the proposed undertakings to increase those rates, the “average” concept the applicant contends for in order to claim that the Agreement passes the better off overall test, with the proposed undertakings as at 12 November 2010, remains the basis upon which it claims the better off overall test should be applied. Moreover, it remains the basis of the applicant’s criticism of the approach of the Tribunal, which is to compare what the rostering of hours provisions of the Agreement and the undertakings as proposed permit and payments prescribed by the terms of the Agreement for such hours to the relevant provisions of the Award respectively.

[65] In my view, the table of “average” hours and the methodology of the applicant’s submissions are both misconceived as a conceptual basis for the applicant’s submissions that the Agreement passes the better off overall test and I reject that submission accordingly.

The form and effect of the proposed undertakings

[66] Since 18 October 2010, when the applicant conceded that the analysis of the Tribunal determining that the flat hourly rates relied upon in its application were deficient when modelled against the Award, the Tribunal has been attempting to facilitate the approval of the Agreement with undertakings in accordance with the guidance provided by the Full Bench in the decisions re McDonalds and BUPA cited above. In that time, on what has been submitted and having regard to comparison between the operation of the terms of the Agreement and all of the undertakings as proposed, I still cannot be satisfied that each employee or prospective employee will be better off overall for reasons which include the following.

[67] In my letter to the applicant of 4 November 2010 I drew the applicant’s attention to difficulties arising from the wording of several of the proposed undertakings in the following terms:

“The second matter which gives rise to concern arising from your correspondence and the proposed undertakings relates to the interaction of the proposed undertakings with clause 2—Incidence and Parties Bound, of the Agreement. In particular, that part of clause 2 is shown in bold as follows:

“It is the intention of the parties, that this Agreement to the extent permitted by law will regulate the terms and conditions of employment of all the “employees” as cited in Clause 10 of this Agreement, to the exclusion of any Award or Industrial Agreement.”

In your letter of 3 November 2010 and the undertakings proposed, reference is made to National Protection Group Australia not referring to or relying upon various clauses of the Agreement. The question raised by these proposed undertakings is whether or not the terms of the reference instrument in relation to the matters covered by those clauses of the Agreement would have application in lieu thereof. If not, it would seem that the undertakings would simply cancel the effect of the relevant terms of the Agreement, and by operation of the provisions of clause 2 of the Agreement set out above, leave those circumstances unregulated either by the Agreement or the reference instrument.”

[68] The issue identified above was not remedied in the applicant’s response of 12 November 2010, which contained the final submissions made in support of approval of the Agreement with the proposed undertakings. The effect of the undertakings concerning clauses of the Agreement which would not be referred to or relied upon, put simply, is that the terms of the Agreement to which they refer would have no application. This would create a vacuum, such that those terms would not operate and nothing would replace them. This, in my view, could only lead to financial detriment to the employees covered by the Agreement as the provisions of clause 2 of the Agreement excluding the operation of the Award would continue to have effect, no undertaking affecting its absolute and continued operation was proposed and no undertaking that the overtime, penalty rates and weekend work, and other relevant provisions of the award or other provision would apply in any way is proposed.

Substantial changes to the terms of the Agreement

[69] Section 190 of the Act deals with approval of enterprise Agreements with undertakings as is set out below:

“190 FWA may approve an enterprise agreement with undertakings

Application of this section

(1) This section applies if:

(a) an application for the approval of an enterprise agreement has been made under section 185; and

(b) FWA has a concern that the agreement does not meet the requirements set out in sections 186 and 187.

Approval of agreement with undertakings

(2) FWA may approve the agreement under section 186 if FWA is satisfied that an undertaking accepted by FWA under subsection (3) of this section meets the concern.

Undertakings

(3) FWA may only accept a written undertaking from one or more employers covered by the agreement if FWA is satisfied that the effect of accepting the undertaking is not likely to:

(a) cause financial detriment to any employee covered by the agreement; or

(b) result in substantial changes to the agreement.

FWA must seek views of bargaining representatives

(4) FWA must not accept an undertaking under subsection (3) unless FWA has sought the views of each person who FWA knows is a bargaining representative for the agreement.

Signature requirements

(5) The undertaking must meet any requirements relating to the signing of undertakings that are prescribed by the regulations.”

[70] Section 190(3) of the Act makes it clear that the Tribunal’s jurisdiction and power to approve an Agreement which does not pass the better off overall test is limited. Among other things, the Tribunal may only accept an undertaking if it is satisfied that the undertaking is not likely to result in substantial changes to the Agreement. Given the extent and scope of the proposed undertakings and the abovementioned effects of the form of the proposed undertakings, I cannot be satisfied that the undertakings are not likely to lead to substantial changes to the terms of the Agreement. On the contrary, I consider that for these same considerations the proposed undertakings would certainly lead to substantial changes to the terms of the Agreement.

Conclusions

[71] I consider that the effect of the undertakings as proposed would result in financial detriment to employees whose employment would be covered by the Agreement, and thus, I cannot reach the requisite satisfaction under s.190(3)(a) of the Act such that I may approve the Agreement with the proposed undertakings.

[72] I consider that the proposed undertakings are likely to lead to substantial changes to the terms of the Agreement and therefore, I cannot establish the requisite satisfaction prescribed by ss.190(3)(b) of the Act. Accordingly, I may not approve the Agreement with those undertakings.

[73] Even if I am wrong and the employees whose employment would be covered by the terms of the Agreement would not suffer a financial detriment and the proposed undertakings can be properly characterised as unlikely to lead to substantial changes to the Agreement I would decline to approve the Agreement with the proposed undertakings. I am not satisfied that the terms of the Agreement together with the terms of the undertakings as proposed would result in each employee and each prospective employee employed under the terms of the Agreement being better off overall than if employed under the terms of the Award for the reasons which are set out above in respect of the effect of the undertakings as proposed and below.

[74] In the absence of information identifying what the actual rosters of hours of work and faced with the applicant’s reliance on an untested and inappropriate concept of “average” roster outcomes, and in light of the fact that the Agreement provides no spread of hours; provides that work performed on Saturdays and Sundays would be performed without penalty commensurate with the provisions of the Award, at the flat hourly rates as increased in accordance with the proposed undertakings; and that there are no shift penalties for work performed under the terms of the Agreement, which may be performed at any time of day or night under the terms of the Agreement; and that the flat hourly rates must compensate for the above and the absence of the annual leave loading prescribed by the terms of the Award and any relevant allowance; and that other terms of the Award are more beneficial than the terms of the Agreement, I am unable to be satisfied that each employee or prospective employee employed, under the terms of the Agreement will be better off overall than under the terms of the Award, on the information before me.

[75] I am mindful that the flat hourly rates prescribed the Agreement are higher for work performed between Monday and Friday, between 6.00 am and 6.00 pm than those of the Award. However, the hours of work performed between 6.00 pm to 6.00 am Monday to Friday would be paid for at a lower rate than provided for by the Award, as will all hours of work performed on Saturdays, Sundays and public holidays and any work performed as overtime.

[76] The matters referred to above can be illustrated by comparative tables showing what payments would be provided for hours of work performed under the terms of the Agreement with the applicant’s proposed undertakings and the terms of the Award respectively.

[77] The following tables represent a comparison of the rates payable under the Agreement, as amended by the applicant’s proposed undertakings for hours of work performed on the days of the week Monday to Sunday during what the award refers to as the day span and the night span respectively

LEVEL 1

Level 1 employee pay rates across all shifts

Agreement		Award MA000016		% Difference
Monday to Friday ordinary hours (6am-6pm)	$18.50	Monday to Friday ordinary hours (6am-6pm)	$16.85	9.8%
Monday to Friday from 6pm to 6am (Shift)	$18.50	Monday to Friday Shift (121.7%)	$20.51	- 9.8%
Saturday	$23.50	Saturday (150%)	$25.28	- 7%
Sunday	$23.50	Sunday (200%)	$33.70	- 30.3%
Public holiday	$26*	Public holiday (250%)	$42.13	- 38.3%