Orica Australia Pty Ltd

[2013] FWCA 3851

[2013] FWCA 3851

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Orica Australia Pty Ltd
(AG2013/1203)

ORICA HELIDON WORKPLACE AGREEMENT 2013

Manufacturing and associated industries
COMMISSIONER RYAN	MELBOURNE, 17 JUNE 2013

Application for approval of the Orica Helidon Workplace Agreement 2013.

[1] An application has been made for approval of an enterprise agreement known as the Orica Helidon Workplace Agreement 2013 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act) and was made by Orica Australia Pty Ltd. The agreement is a single-enterprise agreement.

[2] The Commission contacted the Applicant on 27 May 2013 and raised with the Applicant a number of concerns.

[3] The Applicant filed signed undertakings addressing 7 concerns and the Applicant made a submission to the Commission that undertakings were not required in relation to 2 concerns raised by the Commission.

[4] The Agreement contains a Higher Duties Allowance provision in the following terms:

“14.4. Higher Duties Allowances

Where an employee is performing a higher level role continuously for a period of greater than four (4) weeks, they will be entitled to be paid at the higher rate for the duration of their continuous period in that role.

Periods of four (4) weeks or less at a higher level, or periods where employees are being trained but have not yet been signed off as competent at that level, will be considered development opportunities for the employees, and they will remain at their regular pay level.

[5] In declining to offer any undertaking in relation to clause 14.4 the Applicant said: “Should the need arise, Orica still has the ability to consider higher duties on a case by case basis outside the Agreement.”

[6] The Australian Workers’ Union (AWU), a bargaining representative for the Agreement opposed the Applicant’s submission and contended that:

“Clause 14.4 – Higher Duties

Orica state that they have “the ability to consider higher duties on a case by case basis outside of the Agreement”. This is not an acceptable position for the AWU as it does nothing to ensure the fair and equitable treatment of employees of Orica. The way the clause is written gives the employer the ability to save money by having employees perform higher duties and keep them rotating through the position without having to go to the expense of hiring someone on a permanent basis, therefore requiring them to pay the correct salary for the position. The AWU’s position on this clause is that an undertaking is necessary to protect the interests of the employees.”

[7] It is clear that clause 14.4 of the Agreement could operate in the way described by the AWU, but even if it does so this is not sufficient to require an undertaking from the Commission in relation to the operation of clause 14.4.

[8] The rates of pay in the Agreement are significantly higher than the wage rates in the relevant modern award. The classifications for employees who are covered by the Agreement span the award classifications of C13 to C11, yet the lowest wage rate in the Agreement for a C13 equivalent is greater than the award wage rate for a C7. On this basis even if an employee is performing higher duties and not being paid for doing so the employee will still be better off overall than if employed under the terms of the award.

[9] The second issue upon which the Applicant would not offer an undertaking was in relation to the dispute resolution process in the Agreement. Clause 30 of the Agreement provides as follows:

“30. Grievance Procedures

It is accepted by the parties to this Agreement that any grievances will be resolved in the following manner.

i. In the event of any employee having any grievance, he/she shall discuss the matter with a team leader or supervisor.

ii. Should the matter remain unresolved, the team leader or supervisor will raise the grievance with the department manager and, where required, the team leader shall assist in resolving the grievance.

iii. The department manager shall raise the grievance with the Human Resource Manager at any stage if they feel this may lead to resolution. Following this either party reserves the right to refer the matter to mediation if the matter cannot be resolved at the workplace level.”

[10] In declining to offer any undertaking in relation to clause 30 the Applicant said: “..there is no requirement under the Act for a dispute resolution clause to contain an arbitration step. As such, whilst there may be circumstances under which Orica may consider going to arbitration, it is a step we will consider outside of the Agreement.”

[11] The AWU opposed the submission of the Applicant and contended as follows:

“Clause 30 – Dispute Resolution

The first issue the AWU have with regards this clause is that the first step allows the matter to be raised by the employee but the second step only allows for the team leader to raise the matter with the next level of management should the matter remain unresolved. The clause severely restricts the employee’s ability to advance their grievance beyond their team leader. Another issue from our perspective is that the issue may be with the only person, or level of management, that the employee is able to raise the matter with. The final issue the AWU have with the clause is that it allows for either party to reserve the right to refer the matter to mediation if the matter cannot be resolved at the workplace level. This is unacceptable as it does not mention who may mediate the issue and does not then allow for the matter to be arbitrated should the matter remain unresolved. In the communication sent to you from Orica they say “whilst there may be circumstances under which Orica may consider going to arbitration, it is a step we will consider outside of the Agreement”. This clearly gives all the power to the employer and offers no protection for the employee and basically no recourse should they have a grievance that goes unresolved at the workplace level.”

[12] Whilst the dispute resolution procedure may operate as described by the AWU that is not a sufficient reason to require an undertaking.

[13] The decision of a Full Bench in Woolworths Ltd trading as Produce and Recycling Distribution Centre [2010] FWAFB 1464 makes clear that a dispute resolution clause does not have to guarantee that disputes are settled but only that it provide for a process for settling disputes. Clause 30 of the Agreement meets the requirement of a s.186(6) of the Act in that it provides a process for settling disputes.

[14] I am satisfied that each of the requirements of ss186, 187 and 188 as are relevant to this application for approval have been met.

[15] The undertakings offered by the company are accepted and those undertakings have become terms of the Agreement in accordance with s.191(2) of the Act and are appended at Appendix A.

[16] The Australian Workers’ Union, being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. As required by s.201(2) I note that the Agreement covers the organisation.

[17] The Agreement is approved and, in accordance with s.54(1), will operate from 24 June 2013. The nominal expiry date of the Agreement is 23 June 2016.

COMMISSIONER

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