Perfect Scoop Pty Ltd

[2016] FWCA 4230

[2016] FWCA 4230

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Perfect Scoop Pty Ltd
(AG2016/903)

PERFECT SCOOP PTY LTD - ENTERPRISE AGREEMENT 2016

Fast food industry
DEPUTY PRESIDENT BULL	SYDNEY, 5 JULY 2016

Application for approval of the Perfect Scoop Pty Ltd - Enterprise Agreement 2016

[1] An application has been made by Agnew Legal Pty Ltd (the applicant) for the approval of an enterprise Agreement known as the Perfect Scoop Pty Ltd - Enterprise Agreement 2016 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act) and is a single enterprise Agreement.

[2] The Agreement covers all employees engaged by the employer. As per s.186 of the Act, I am satisfied that the group of employees was fairly chosen.

[3] The Fast Food Industry Award 2010 (the Award) is the relevant reference instrument for the purposes of the better off overall test (BOOT) as required under s.186 of the Act.

[4] The Commission notes that there were no employee organisations appointed as bargaining representatives and no employee bargaining representatives involved in the agreement making process.

[5] On 24 May 2016, the Commission wrote to the applicant seeking clarification of the reason for the delay in lodging the application with the Commission, as well as confirmation that employees had been advised of the time, place and method of the vote to approve the Agreement at least seven days before that vote took place. The Commission also sought information on Agreement provisions concerning loaded rates of pay and parameter of hours to be worked by employees, as well as regarding the definition of “immediate member of family and household” outlined in clause 1.2 of the Agreement.

Late lodgement

[6] The Commission noted that the application for approval of an enterprise Agreement was not made to the Commission within 14 days after the Agreement was made as required by s185(3)(a) of the Act. The Commission requested an explanation for the delay in making the application in order to consider if in all the circumstances it is fair to extend the 14 day period prescribed in s185(3)(a).

[7] Mr Agnew, the bargaining representative for the employer, provided the Commission with information that the delay in lodgement was due to a breakdown in communication with his client, the employer, who resides interstate. Given this response and pursuant to s.185(3)(b), in all the circumstances I consider it fair to extend the time for making the application to the date it was actually made.

Notification of time, place and method of vote to approve Agreement

[8] The Commission noted that the response to question 2.5 of the Form F17 submitted to the Commission as part of the application did not state whether employees were advised of the location of the vote to approve the Agreement as required by s.180(3) of the Act. The Commission requested that a revised Form F17, containing information on when employees were advised of the location of the vote to approve the Agreement, be submitted to the Commission, in order to enable to Commission to confirm that the requirements of s.180(3) of the Act had been met.

[9] Mr Agnew provided the Commission with a revised Form F17. The revised Form F17 was made by Jim Efstathiou, the Director of the employer, and confirmed that employees had been advised of the time, place and method of the vote more than 7 days before the vote to approve the Agreement was held. As a result, I am satisfied that the requirements of s.180(3) of the Act have been met.

Definition of household

[10] The Commission noted that clause 1.2 the Agreement defined “immediate member of family or household” (sic) in the same manner as “immediate family” is defined by s.12 of the Act. Although the term “immediate family” is defined by the Act, the term “household”, which is a term relevant when determining an employee’s entitlement to compassionate and carer’s leave under the Act, is not defined anywhere in the Act. The Agreement definition of “immediate member of family or household” has the effect of contravening s.55 of the Act by appearing to limit the operation of the term ‘household’ and, thereby, reducing an employee’s entitlement to compassionate and carer’s leave. In its correspondence of 24 May, the Commission expressed concern that the application did not meet the requirements of s.186(2)(c) of the Act, which provides that an agreement cannot be approved if it contains terms that contravene s.55 of the Act.

[11] In response to the Commission’s concerns, the applicant provided an undertaking replacing the definition of “immediate member of family or household” with a definition of “immediate family” in line with the definition of “immediate family” provided in s.12 of the Act.

Rates of pay, rostering under the parameter of hours and wage review

[12] The Agreement provides base rates of pay 8.25% to 11.41% above the corresponding minimum rates of pay under the modern Award. The Agreement is stated to cover permanent full-time, permanent part-time and casual employees. The hourly rates for permanent employees are inclusive of annual leave loading. The hourly rates for casual employees incorporate a casual loading of approximately 23%.

[13] The Commission noted that the hourly rates are applicable for work on any day of the week. The Commission was concerned that these hourly rates did not appear to be high enough to compensate for the removal of weekend and public holiday penalties particularly if employees work regularly during these times including casual employees who may work a significant number or majority of their working hours during weekends and public holidays. The Commission noted the provisions of Appendix A which provide a parameter of hours worked Monday to Friday, Saturday, Sunday, public holidays and evenings. The Commission conducted an analysis of the Agreement rates in accordance with those parameters. The Commission was concerned that employees working in accordance with those parameters may not be better off overall under the Agreement with the hourly rates provided by the Agreement. The Commission was also concerned that it was unclear whether the parameter of hours would be applied proportionately to part-time and casual employees. The Commission requested the applicant provide undertakings to address these concerns.

[14] In response to the request of the Commission, the applicant provided undertakings as follows:

● that the hourly base rates of pay for full-time and part-time employees provided in clause 3.2.1 of the Agreement are deleted and replaced by higher rates;
● that the hourly rates of pay for casual employees provided in clause 3.2.1 of the Agreement are increased and now incorporate a loading of approximately 25% of the increased base rates of pay for full-time and part-time employees; and
● that the parameter of hours in Appendix A of the Agreement will be pro-rated for part-time and casual employees.

[15] In addition to the undertakings provided by the applicant, the Commission notes that Appendix A of the Agreement also requires:

● that hourly rates are based on the parameter of hours provided in Appendix A and that employees will be rostered equitably in accordance with those parameters; and
● that the employer will conduct a wage review for each employee against the modern award on the anniversary date of the Agreement or if an employee terminates their employment during the nominal term of the Agreement and should the review establish an employee is no better off overall under the Agreement, the employer will pay the difference to the employee within 3 pay periods.

[16] The Commission conducted a second analysis of the hourly rates provided in the undertakings in accordance with the parameters of Appendix A including the effect of working some weekend and public holiday shifts. The Commission is satisfied that the higher rates address the issue raised with the applicant and that these rates in conjunction with rostering based on the parameter of hours, prorated for part-time and casual employees, will ensure that employees at all classification levels remain better off overall under the Agreement.

Undertakings provided

[17] The undertakings provided by the applicant address the Commission’s concerns as detailed above. The undertakings provided by the employer are attached at Annexure A of this decision. The undertakings are taken to be a term of the Agreement.

[18] The undertakings are not so substantial that if asked to vote again, the employees who voted would not approve the Agreement. I am therefore satisfied that the undertakings do not result in a substantial change to the Agreement, as per s.190(3)(b) of the Act.

Approval

[19] Taking into account the revised rates of pay under the Agreement when compared to the modern Award and other undertakings provided by the applicant in relation to parameter of hours, equitable rostering, wage review and commitment to apply the parameter of hours proportionately as detailed above, I am satisfied that the Agreement results in employees being better off under the Agreement.

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

[21] The Agreement is approved. In accordance with s.54(1), the Agreement will operate from 12 July 2016. The nominal expiry date of the Agreement is 30 June 2019.

[22] This decision and its undertakings should be brought to the attention of employees covered by the Agreement by the applicant.

DEPUTY PRESIDENT

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Annexure A