Precast Civil Industries Pty Ltd T/A BCP Precast

[2018] FWC 3672

[2018] FWC 3672

FAIR WORK COMMISSION

DECISION

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

Precast Civil Industries Pty Ltd T/A BCP Precast
(AG2017/6365)

COMMISSIONER MCKINNON MELBOURNE, 21 JUNE 2018

Application for approval of the BCP Precast Warnervale Enterprise Agreement 2017.

[1] Application has been made by Precast Civil Industries Pty Ltd T/A BCP Precast under (Precast) s.185 of the Fair Work Act 2009 (the Act) for approval of a single enterprise agreement known as the BCP Precast Warnervale Enterprise Agreement (the Agreement). The Agreement is intended to operate to the exclusion of the Concrete Products Award 2010 (the Concrete Award) and the Manufacturing and Associated Industries and Occupations Award 2010 (the Manufacturing Award). The Australian Workers’ Union (AWU) was a bargaining representative for the Agreement as were two individual employees.

[2] Concerns have been identified about whether the Agreement passes the better off overall test, having regard to terms in the Agreement dealing with hours of work, shift, overtime, minimum engagement periods, overtime, allowances, annual leave and leave loading, termination, and redundancy. On 27 April 2018, 14 May 2018 and 30 May 2018 the Applicant provided responses to the issues raised.

National Employment Standards

[3] Clause B.43 of the Agreement may be less beneficial than the National Employment Standards (NES) at section 117 to the extent that it excludes an entitlement to notice of termination in circumstances where an employee is deemed to have abandoned their employment if absent for more than 3 days. 1 An undertaking has been given to address the concern.

[4] Clause B.20 appears to be inconsistent with the NES (section 93(2)(c)) because it provides that annual leave loading is not payable when annual leave is cashed out. An undertaking has been given to address this concern.

Better Off Overall Test

[5] Section 193(1) of the Act provides as follows:

“193(1) An enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if the FWC is satisfied, as at the test time, that 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.”

[6] The Agreement contains a range of more beneficial terms than the Awards, including in relation to the rates of pay (with rates ranging from 1.67% to 52.86% above the Awards), provision of additional uniforms, leading hand allowance, movement of rest breaks for earlier finish times and a patching and grinding allowance. Rates of pay for employees employed after 12 March 2015 are in the range of 2.07% to 7.13% above Award rates of pay.

[7] The Agreement contains a number of less beneficial terms when compared to the Award including a different span of hours, application of casual loading, higher duties, job search entitlement, allowances, minimum engagement periods, accident pay, directed annual leave, shift definitions, overtime for part time employees and casual conversion.

[8] The span of hours in the Agreement is 5.00am to 6.00pm, Monday to Friday, while the Awards span of hours is 6.00am to 6.00pm. Precast has given an undertaking to address the concern.

[9] The Agreement provides for casual loading only on ordinary hours. There is no casual loading for work outside of ordinary hours, for example on weekends. Precast has given an undertaking to address the concern.

[10] Clause B.6 of the Agreement provides that employees performing higher duties will be paid their normal rate of pay for work of four hours or less in the higher role. Employees regularly working periods of four hours less in a higher classification may not be better off overall. Precast has provided an undertaking to address this concern.

[11] The Agreement does not deal with access to time off for the purposes of job search once given notice of termination or redundancy. Precast has provided an undertaking to address this concern.

[12] Clause B.18 of the Agreement provides for leading hand allowance, tool allowance and first aid allowance at rates that are below those in the Awards. In addition, there is no meal allowance for employees that would be covered by the Manufacturing Award. Employees who would be entitled to allowances under Clause 32 of the Manufacturing Award may not be better off overall in the absence of those allowances under the Agreement . Precast has given an undertaking to address the concern.

[13] There is no minimum engagement for part time employees, Saturday overtime and work on public holidays. The rates of pay in the Agreement do not appear to be sufficient to compensate each class of prospective employee if they work less than the minimum engagement periods and only a partial undertaking has been given to address the concern.

[14] The Agreement makes no provision for accident pay while Clause 18 of the Concrete Award does. The rates of pay in the Agreement do not appear to be sufficient to leave employees better off overall if they suffer an injury that would otherwise qualify for accident pay under the Agreement. Precast have provided an undertaking to address this concern.

[15] Clause B.20 of the Agreement deals with directed annual leave but does not contain a number of the safeguards in the Concrete Award and the Manufacturing Award. Precast submit that the rates of pay in the Agreement are sufficient to overcome this concern.

[16] It is unclear when a part time employee becomes entitled to overtime penalties under the Agreement because there are inconsistent overtime penalty rules in the Agreement. Clause B.4 provides that overtime is payable for work in excess of hours mutually agreed, while clause B.14 provides that overtime is payable for work in excess of 7.6, 10 or 12 hours. The Manufacturing Award provides that part time employees are paid overtime for work in excess of agreed hours. Part time employees covered by the Manufacturing Award may not be better off overall if required to work hours in excess of agreed hours and Precast has given in relation to the concern but I am not satisfied that it is an adequate answer to the concern. It would make clause B.4 operate subject to clause B.14, so that part time employees would only receive overtime penalties for hours in excess of 7.6, 10 or 12 hours per day as opposed to work in excess of agreed upon hours as provided by the Award. In the circumstances, I am not satisfied that the undertaking would not cause financial detriment to employees.

[17] Clause B.3 of the Agreement makes clear that the company cannot guarantee casual employees a full time position if they have worked for more than 12 months in a full time position. Clause 14.4 of the Manufacturing Award and Clause 11.6 of the Concrete Award provide the option of conversion from casual to permanent employment after 6 months. The benefits provided by the Agreement do not appear to be sufficient to compensate for the loss of this entitlement.

Undertakings

[18] As noted above, Precast has given a range of undertakings to address the concerns identified in relation to the Agreement. A copy of the undertakings provided to date is attached in Annexure A.

[19] I am not satisfied that the Agreement passes the better off overall test in accordance with s.182(2)(d) and s.193 of the Act. While the undertakings would assist in overcoming the range of concerns, I am concerned that when viewed as a whole, the effect of accepting the undertakings is likely to result in substantial change to the Agreement.

[20] Bargaining representatives will be given 7 days to file submissions on whether the effect of accepting the undertakings is likely to result in substantial changes to the Agreement. The application will then be determined.

COMMISSIONER

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Annexure A

 1   Bienias v Iplex Pipelines Australia Pty Limited[2017] FWCFB 38