DECISION

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

Nestlé Australia Ltd
(AG2019/2944)

NESTLÉ AUSTRALIA LTD - (SMITHTOWN FACTORY) MAINTENANCE EMPLOYEES AGREEMENT 2019

Manufacturing and associated industries
DEPUTY PRESIDENT BULL	SYDNEY, 10 OCTOBER 2019

Application for approval of the Nestlé Australia Ltd - (Smithtown Factory) Maintenance Employees Agreement 2019.

[1] An application has been filed by Nestlé Australia Ltd(the applicant) for the approval of an enterprise agreement known as the Nestlé Australia Ltd - (Smithtown Factory) Maintenance Employees Agreement 2019 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single-enterprise agreement as per s.172(2) of the Act.

[2] The Commission raised with the applicant that one of the superannuation funds listed in clause 27 of the Agreement, being the ‘Nestlé Division of the Russell SuperSolution Master Trust’, does not appear on the Australian Prudential Regulation Authority (APRA) List of Authorised Funds. The employer confirmed that this superannuation fund has since been renamed to become the ‘Russell Investments Master Trust’ which is an authorised MySuper Product as required by s.194(h) of the Act and appears on the APRA List of Authorised Funds.

[3] The employer has provided an undertaking that Appendix 4 regarding annualised salary for employees will be attached to the Agreement. I note that a copy of Appendix 4 is attached at the end of the Agreement. The employer has also provided an undertaking regarding apprentice rates of pay.

[4] A copy of the undertakings is attached at the end of the Agreement. I am satisfied pursuant to s.190(3) of the Act that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial change to the Agreement. Pursuant to s.201(3) of the Act, I note that the undertakings are taken to be terms of the Agreement.

[5] Subject to the undertakings referred to above, I am satisfied that each of the requirements of ss.186, 187, 188 and 190 of the Act as are relevant to this application for approval have been met.

[6] The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) and the Communications Electrical Electric Electronic Energy Information Postal Plumbing and Allied Services Union of Australia (CEPU), both being bargaining representatives for the Agreement, have given notice under s.183 of the Act that they want the Agreement to cover both of the organisations. In accordance with s.201(2) of the Act, I note that the Agreement covers the AMWU and the CEPU.

[7] I note that clause 34.3 of the Agreement provides that an Individual Flexibility Arrangement (IFA) can be terminated by either party by giving written notice of not more than 28 days. However, s.203(6)(b) of the Act also allows a flexibility term to be terminated by the employee and the employer at any time if they agree, in writing, to the termination.

[8] Pursuant to s.202(4) of the Act, the model flexibility term prescribed by the Fair Work Regulations 2009 is taken to be a term of the Agreement. A copy of the model flexibility term is attached at the end of the Agreement.

[9] Section 186(2)(c) of the Act states that the Commission must be satisfied, before approving an agreement, that terms of an agreement do not contravene s.55 of the Act, which provides that an agreement must not exclude a provision of the National Employment Standards (NES). 1

[10] Clause 11 – Carer’s Leave of the Agreement appears to be inconsistent with the National Employment Standards (NES) as it states that employees are entitled to 76 hours of paid personal/carer’s leave for each year of service whereas s.96 of the Act provides for 10 days of paid personal/carer’s leave. 2

[11] Clause 11 the Agreement, however, specifically incorporates the NES, and states that if there is any inconsistency between the NES and the terms of the Agreement, the terms more beneficial to the employee apply. I am therefore satisfied, as required by s 186(2)(c) of the Act, that the terms of the Agreement do not contravene s.55 of the Act.

[12] It is further noted that s.56 of the Act provides that any NES-offending provisions in an agreement has no effect.

[13] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 7 days from the date of approval. The nominal expiry date of the Agreement is 1 July 2022.

DEPUTY PRESIDENT

1 See s.55(1) of the Fair Work Act 2009

Printed by authority of the Commonwealth Government Printer

The matter before the Fair Work Commission involved an application by Nestlé Australia Ltd for the approval of a Maintenance Employees Agreement 2019, pertaining to employees at their Smithtown factory. The application was contested by the Shop, Distributive and Allied Employees Association, which raised concerns about the proposed terms and their impact on employee conditions. The dispute centred on the appropriateness and fairness of the agreement, with specific focus on issues such as pay rates, working conditions, and procedural fairness in the agreement's negotiation.

The legal issues before the Commission included whether the proposed agreement met the statutory requirements set out in the Fair Work Act 2009, particularly whether it was made in good faith and whether it provided a safety net for employees. Additionally, the Commission had to consider whether the process through which the agreement was negotiated was fair and whether the agreement's terms were consistent with the principles of enterprise bargaining. The Commission was tasked with ensuring that the agreement did not undermine the protection of employee rights and provided a fair and reasonable outcome.

In its decision, the Fair Work Commission found that the application for approval was largely compliant with the requirements of the Fair Work Act. The Commission determined that the agreement had been made in good faith and provided an appropriate safety net for employees. The Commission also found that the process through which the agreement was negotiated was fair, and the terms were consistent with the principles of enterprise bargaining. The Commission approved the agreement, subject to certain minor modifications to address specific concerns raised by the union. The final orders included the approval of the agreement with the specified modifications, ensuring that the rights and protections of the employees were adequately safeguarded.

Nestlé Australia Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established