Pierce Engineering Pty Ltd T/A Pierce Engineering Pty Ltd
[2024] FWCA 3105
•26 AUGUST 2024
| [2024] FWCA 3105 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement
Pierce Engineering Pty Ltd T/A Pierce Engineering Pty Ltd
(AG2024/2181)
PIERCE ENGINEERING PTY LTD ENTERPRISE AGREEMENT 2024
| Building, metal and civil construction industries | |
| DEPUTY PRESIDENT SLEVIN | SYDNEY, 26 AUGUST 2024 |
Application for approval of a single-enterprise agreement
Pierce Engineering Pty Ltd T/A Pierce Engineering Pty Ltd has applied for approval of an enterprise agreement known as the Pierce Engineering Pty Ltd Enterprise Agreement 2024 (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. The Commission must approve the Agreement if satisfied that the requirements in ss 186 and 187 are met.
Section 186(2)(c) requires that the terms of the Agreement do not exclude the National Employment Standards (NES). An issue was raised as the Agreement does not define an employee as a shiftworker for the purposes if the NES in accordance with s187(4) and s196 of the Act. In response to this the Applicant provided an undertaking.
A further issue was raised in relation to annual leave hours as clause 6.1.1 of the Agreement provides for 152 hours of annual leave whereas the Act at s87(1)(a) provides 4 weeks. In response to this the applicant provided an undertaking
Additionally, Agreement Clause 6.1 (annual leave) is silent in relation to an additional week of annual leave for shift workers, however it is noted the NES applies in relation to silent terms. In response to this the Applicant also clarified that they do not employ shift workers and their ordinary business arrangements do not require them to.
A further issue was raised in relation to withholding monies at termination. Clause 7.1.1 of the Agreement provides that if the employee does not provide the required notice of termination, the employer may withhold monies due to the employee on termination. The effect of this clause is it appears to permit the employer to withhold monies owing to the employee under the NES (such as accrued but unused annual leave or long service leave on termination or redundancy payments) and does not appear to limit the source of monies which may be deducted. The clause may be unenforceable if found to be contrary to s 324 which provides for the circumstances where an employer may be permitted to make deductions from an employee’s pay. In response to this the Applicant provided an undertaking.
Section 186(2)(d) requires the Commission to be satisfied the agreement passes the better off overall test (BOOT). The test is found in s 193 of the Act and it is to be applied in accordance with s 193A. Under s 193 the Commission must be satisfied, as at the time the application for approval was made, that each award covered employee, and each reasonably foreseeable employee, for the agreement would be better off overall if the agreement applied to the employee than the relevant modern award.
Here the relevant award is the Manufacturing and Associated Industries and Occupations Award 2020 and the Clerks – Private Sector Award 2020. In applying the test, the Commission is required by s 193A to make a global assessment of whether each employee would be better off having regard to the terms of the agreement which would be more beneficial than the Award and the terms which would be less beneficial. In making that assessment, the Commission may have regard to the patterns or kinds of work, or types of employment, that are reasonably foreseeable at the time of the application.
An issue was raised in relation to level 1 and 2 administrative employees being paid 1.56% - 6.26% below the award. In response to this the Applicant clarified that they do not employ clerical staff below Level 3. Additionally, an undertaking was provided.
An additional issue was raised in relation to adult apprentices as the Agreement does not specify if adult apprentices can be engaged as such. The Applicant provided clarification that they do not employ Adult Apprentices. An undertaking was provided to that regard.
A further issue was raised in relation to Apprentice classifications as under the Agreement Level 1 Non-Adult Apprentices are paid 0.82% below the Award. In response to this the Applicant provided an undertaking.
A further issue was raised in relation to loaded pay rates as Agreement clause 4.1 provides the employer may provide employees with a higher hourly rate of pay, which shall be used ‘for all purposes, such as annual leave, personal/carer's leave and any other authorised paid leave’. It is unclear if this is intended to also compensate for penalties and entitlements. In response to this the Applicant provided an undertaking.
A further issue was raised in relation to maximum daily hours as Clause 5.1.4 of the Agreement provides that the maximum ordinary daily hours shall not exceed 12 hours a day whereas Clause 13.17 of the Award provides that the maximum number of ordinary hours that can be worked on any day is 10. In response to this the Applicant provided an undertaking.
Given the explanations provided by the applicant, the undertakings provided, and having regard to s.193A(6), and in particular the types of employment and patterns of work of the employees covered by the Agreement, I am satisfied that the BOOT is met. A copy of the undertakings in relation to the matters raised is attached in Annexure A.
The terms of the undertakings were provided to all bargaining representatives. No objection was raised. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and will not result in substantial changes to the Agreement. Pursuant to s.201(3), the undertakings are taken to be terms of the Agreement. I note that should the work patterns, kinds of work or types of employment under the Agreement change, an application under s.227A is available for a reconsideration of the BOOT.
The Agreement does not cover all of the employees of the employer, however, taking into account the factors in sections 186(3) and (3A) I am satisfied that the group of employees was fairly chosen.
Having regard to the undertakings and the material contained in the application and filed in relation to it, including submissions of the applicant as to intended operation of the Agreement, I am satisfied that each of the requirements of ss.186 and 187 are met.
The Agreement was approved on 26 August 2024, and, in accordance with s.54, will operate from 2 September 2024. As per Clause 1.3.1 the nominal expiry date 26 August 2027.
DEPUTY PRESIDENT
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Annexure A
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