RAC Insurance Pty Limited T/A RAC Insurance

[2020] FWCA 6744

[2020] FWCA 6744

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

RAC Insurance Pty Limited T/A RAC Insurance
(AG2020/3232)

RAC INSURANCE ENTERPRISE AGREEMENT 2020

Banking finance and insurance industry
COMMISSIONER WILSON	MELBOURNE, 18 DECEMBER 2020

Application for approval of the RAC Insurance Enterprise Agreement 2020.

[1] An application has been made for approval of an enterprise agreement known as the RAC Insurance Enterprise Agreement 2020 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by RAC Insurance Pty Limited T/A RAC Insurance. The Agreement is a single enterprise agreement.

[2] The application was filed in the Fair Work Commission (the Commission) on 26 October 2020. After the application was filed, the Finance Sector Union of Australia (FSU) filed a Form F18 statutory declaration on 13 November 2020 which advised the union disagreed with one or more statements in the employer’s Form F17 statutory declaration relating to the Agreement. In particular, the FSU disagreed with the Applicant on a number of matters, including the span of hours, definition of “shiftworker” for the purpose of the additional week of annual leave and Claims Assist Flexible Roster Employees being better off overall under the Agreement.

[3] Following the Commission’s preliminary assessment process, and in the usual course, my Chambers sent correspondence to the parties named in the initiating application setting out the concerns I held in relation to the Agreement in respect of the National Employment Standards (NES) and the Better Off Overall Test (BOOT). This correspondence was issued on 16 November 2020. The correspondence also requested the FSU expand upon their commentary in the Form F18.

[4] Once filed, the FSU’s expanded commentary canvased the matter of Claims Assist Flexible Roster Employees possibly not being better off overall under the Agreement.

[5] I also received written responses from the Applicant. In response to the Commission’s concerns, the Applicant made submissions on the consistency of the proposed Agreement with the NES and whether the BOOT had been passed, and proposed undertakings addressing the matters of carer’s leave, overtime and rostered hours of work of part-time employees. The Commission’s concerns were resolved by the Applicant’s submissions and proposed undertakings, other than for the matter contested by the FSU.

[6] On reviewing the material provided by the employer and the FSU, I issued Directions to parties on 1 December 2020 for the FSU’s concern to be fully articulated and responded to by the Applicant. A hearing on the matter was convened on 15 December 2020.

[7] The parties confirmed in the hearing before me that the only issue in contention is the classification descriptor for Grade B Claims Assist Flexible Roster Employees.

SCOPE OF THIS DECISION

[8] This is a decision relating to provisions within the Act’s Part 2 – 4, Enterprise Agreements.

[9] Part 2 – 4, Division 3 (Bargaining and representation during bargaining) sets out certain procedural steps for the commencement of bargaining and bargaining itself. No matters arise under this part.

[10] Part 2 – 4, Division 4 (Approval of enterprise agreements) contains requirements to be satisfied for the Commission to approve an Enterprise Agreement. No matters arise under this part.

[11] In relation to the matters set out within Subdivision B (Approval of enterprise agreements by the FWC) s.186 concerns require determination.

[12] No matters within s.187 arise for determination.

[13] The Commission is also required to consider whether any concerns it holds in relation to s.186 may be remedied through an Undertaking given under s.190.

[14] The provisions of Subdivision D (Unlawful terms) does not require consideration.

[15] The provisions of Subdivision E (Approval requirements relating to particular kinds of employees) does not require consideration.

[16] No matters within Subdivision F (Other matters) arise for determination (dealing with the model flexibility and consultation terms).

[17] As a result, it may be seen that the only matter requiring determination in this decision is the requirements in s.186 that employees are better off overall under the Agreement.

COMMISSION HELD CONCERNS

[18] On 16 November 2020, correspondence was sent by my Chambers setting out matters I viewed as concerns relating to the NES and the BOOT including:

● Notification requirements for carer’s leave; and

● Overtime for classification D and part-time employees.

[19] The Commission’s concerns have been adequately resolved through RACI’s proposed undertakings, which are in the following terms:

“3. Carer's leave

RACI undertakes that clause 16.2(g)(iv) of the Agreement will operate subject to the National Employment Standards, in that the notice requirements set out in section 107(2) will apply.

4. Overtime

RACI undertakes that Grade D employees will not be required to work, more than 13 hours of overtime in any week.

In the event that Grade D employees do work more than 13 hours of overtime in any week, the overtime penalties set out in clause 9.8(e) of the Agreement will apply.

5. Rostered hours of work for part-time employees

RACI undertakes that part-time Grade A and B employees will not be required to work, less than 10 or 11 hours per week.

In the event that that a Grade A or Grade B employee is rostered to work less than 10 or 11 hours, RACI will provide an hourly loading that ensures that they are always better off overall than under the Banking, Finance and Insurance Award 2020 in any given week.”

[20] The FSU has not submitted these undertakings should not be accepted by the Commission, do not resolve the concerns held by the Commission or would be likely to cause financial detriment to any employee covered by the Agreement or result in substantial changes to the Agreement.

OBJECTIONS OF THE FSU

[21] RACI at item 9 of its Form F17 states that the Grade B classification in the Agreement corresponds with the Level 2 classification in the Award. The FSU disagrees that Grade B is equivalent to Level 2 and assert it is more appropriately equivalent to Level 3 in the Award when the classification descriptors are compared.

CONSIDERATION OF THE FSU OBJECTIONS

Relevant Comparator for Claims Assist Employees

[22] The FSU asserts the Agreement as currently drafted is not capable of approval as it contains a classification that is not used against the appropriate Award comparator in the Banking, Finance and Insurance Award 2020 (Award):

“The classification descriptor for Level 2 employees under the Award includes an indicative job list, which lists positions such as: telemarketer, sales and service trainee, data processing officer, teller/customer service representative with less than 12 months experience, entry level claims officer.

The agreement classification descriptor in the agreement for Band B includes that ‘These roles require specialised skills gained either through extended job experience or extended job‐related training; Able to handle more complex administrative processes; &/or research; or fully trained technical or office sales/customer service specialist’.” 1

[23] The Grade B classification descriptor in the Agreement provides:

Band	Band Title	Skills	Decision Making & Complexity of Tasks	Sphere of Influence Scope/Timeframe
B	Support Transitional/Intermediate	• Carries out a range of higher-level administrative, technical, research or sales/customer service tasks that may require some specialised (generally non- theoretical skills) gained through on-the- job training • May be developing industry knowledge in insurance or other financial services through training, work experience or a course relevant to the area of work • Essential to achieving job objectives are combined skills in understanding people & adapting standard responses to customer needs (internal or external), whether this be related to process or product • Ability to communicate, understand &/or to convey technical issues & information (as they relate to process, product or methodology), & translate into actions • These roles require specialised skills gained either through extended job experience or extended job-related training • Able to handle more complex administrative processes; &/or research; or fully trained technical or office sales/customer service specialist • May coach/manage staff working in process/customer service environment or co-ordinate activities of team members	• Applies standard procedures and knowledge • Independence regarding HOW tasks are performed within clear guidance about WH AT needs to be achieved and WHEN • Some complexity in the extent and choice of actions required • Works primarily on specialist or technically complex issues that are governed by guidelines & have established precedents – i.e. assistance may be available from solutions developed earlier, or elsewhere within the business • Expected to solve all recurring issues & challenges within the scope of the role, without a requirement to refer to a higher level (i.e. improvements to process & methods should be routinely made on the basis of previous experience and application of professional standards) • Decisions made & actions taken are subject to periodic review and guidance by more senior managers	• Works for extended periods under general supervision only • Ongoing regular tasks

[24] The Level 2 classification description in the Award provides:

“A.2 Level 2

A Level 2 position performs tasks and service requirements given authority within defined limits and employer established guidelines, using a more extensive range of skills and knowledge at a level higher than in Level 1.

Level 2 employees are responsible for their own work which is performed within established routines, methods and procedures.

Typical activities and skills may include but are not limited to:

○ processing of standard documentation;

○ undertaking cashiering functions;

○ answering enquiries from members and external parties using a detailed knowledge of specific business activities;

○ drafting correspondence appropriate to job function;

○ organising own work schedule; and/or

○ providing information/assistance to other staff members.

Indicative job list—telemarketer, sales and service trainee, data processing officer, teller/customer service representative with less than 12 months experience, entry level claims officer.”

[25] The FSU contend that the Level 2 classification descriptor when compared with Grade B, that the skills and experience of an employee required to perform a role such as the Claims Assist position is greater than that of an employee that would be classified at Level 2 and is more appropriately compared with Level 3.

[26] The level of experience and performance expected of a Grade B employee is greater than that of a less experienced trainee or entry-level claims officer that would typically be employed under Level 2 and would typically be someone who has more than 12 months’ experience. 2

[27] The Level 3 classification description in the Award provides:

“A.3 Level 3

A Level 3 position is one in which tasks and service requirements are performed using a more extensive range of skills and knowledge at a higher level than required in Level 2.

The position encompasses limited discretion in achieving task outcomes. A level of delegation and authority may be employed consistent with the job function and is performed predominantly within established policies and guidelines.

Those employed at this level are responsible and accountable for their own work, and may be expected to provide direction to other staff.

Typical activities and skills may include but are not limited to:

○ undertaking of projects;

○ preparing reports and recommendations within their own job function;

○ drafting of routine correspondence;

○ administering/maintaining staff records; and/or

○ delivery and/or co-ordination of learning and development activities.

Indicative job list—receptionist, loans processing officer, helpdesk operator, credit analyst, card services operator, contact centre officer, payroll clerk, teller or sales representative with at least 12 months’ experience, insurance clerk, case manager, account manager, technical officer, statistical clerk.”

[28] The FSU’s argument against the classification descriptor being a Level 2 equivalent relates to the level of skill and expertise the employee is expected to possess to perform the role:

“12. A Grade B Claims Assist employee is expected to be more experienced than a Level 2 ‘trainee’ or ‘entry-level’ claims officer and would be required to deal with more specialist or technically complex issues, for example. They would also have the ‘ability to communicate, understand &/or to convey technical issues & information’ which is more closely aligned to Level 3 employees who would be ‘responsible and accountable for their own work and may be expected to provide direction to other staff’.

13. Further, Grade B employees meet the Level 3 requirement outlined in the Award because they are ‘expected to solve all recurring issues & challenges within the scope of the role, without a requirement to refer to a higher level (i.e. improvements to process & methods should be routinely made on the basis of previous experience and application of professional

standards)’.

…

16. According to the Agreement Grade B employees ‘require specialised skills gained either through extended job experience or extended job-related training’. It could be said then that in order to perform a Grade B role it is ‘mandatory’ to have the requisite specialised skills that can only be gained though greater experience than that of an employee who would be at, or closer to an entry-level employee classified at Level 2.”

[29] The FSU are concerned Grade B employees may not be better off overall if they were correctly compared to Level 3 under the Award due to the extended span of hours and weekend penalties.

[30] The Applicant disputes the FSU’s assertion that the classification descriptor for Grade B employees is incorrect:

“(a) Claims Assist Employees, having regard to the language of the Agreement, understood its proper context having regard to the nature of the Applicant’s enterprise and the work performed by such employees, are properly translated and should be assessed against Award Level 2 when undertaking the Better Off Overall Test (BOOT); and

(b) In any event, whether assessed against Award Level 2 or Award Level 3, Claims Assist Flexible Roster Employees are better off overall under the terms of the Agreement when compared to the Award.” 3

[31] RACI disagrees with the FSU’s interpretation of contrasting the Agreement’s terms to the Award. The Applicant views that the correct approach to interpretation should be undertaken in the proper practical context based on the actual tasks such employees perform; and in light of the context to which B and B descriptors are expressed in the Agreement. 4 RACI view the FSU’s interpretation as too narrow in scope.

[32] The Applicant submits that Level 2 is the correct comparator level as the activities and skills required of the employee include:

“(a) processing of standard documentation;

(b) answering enquiries from members and external parties using a detailed knowledge of

specific business activities;

(c) drafting correspondence appropriate to job function;

(d) organising own work schedule; and/or

(e) providing information/assistance to other staff members.”

[33] RACI asserts that Claims Assist Employees are regarded as the Applicant’s entry level claims officers 5 and are not required to hold any qualifications. Further, when compared against Level 3 of the Award, Grade B employees do not:

“(a) undertaking of projects;

(b) preparing reports and recommendations within their own job function;

(c) administering/maintaining staff records; and/or

(d) delivery and/or co-ordination of learning and development activities.” 6

[34] The evidence before me supports the RACI submission with Claims Assist Employees being those in entry level positions and that, were they to work under the Award, their Award classification would be Level 2.

[35] Evidence given by RACI’s Human Resources Business Partner, Michelle Crawford identified not only the duties that Claims Assist Employees performed, but also the duties they did not perform:

“11. Approximately 90% of the duties of Claims Assist employees involve them taking calls and interacting with members on the telephone. However, Claims Assist employees may also be required to perform:

(a) some drafting of standard form communications, and ad hoc administrative tasks such as printing and mailing communications to members;

(b) answering queries from members regarding their claim, based on the case notes and advice that is placed on the member’s claim file by a claims specialist;

(c) answering queries from members regarding their policy coverage (where those queries are complex, they are required to be transferred to the appropriate claims specialist); and

12. Claims Assist employees do not:

(a) make any decisions regarding the acceptance or settlement of a claim other than certain simple claims;

(b) deal with complex insurance claims or matters;

(c) draft complex insurance claim correspondence;

(d) supervise or train other employees; or

(e) deal with technical issues or advice.” 7

[36] I am satisfied this evidence confirms the RACI submission that Claims Assist Employees, classified under the Agreement as Grade B employees, would if paid under the Award be classified as Level 2 employees.

Whether Claims Assist Employees are Better Off Overall under the terms of the Agreement when Compared to Level 3 Award Conditions

[37] The Applicant submits that if it is not accepted by the Commission that the correct classification match is Level 2 then the Agreement is capable of approval as employees would still be better off overall if compared with the Level 3 classification. On that subject they submit that even on the FSU’s modelling, it indicates that “Claims Assist Employees receive an annual base salary of $57,870 under the Agreement compared to $48,199 under the Award.” 8 Furthermore, they submit that when loadings, penalties and allowances are included in a comparison that employees remain better off overall.

[38] The Commission notes that Clause 14.7 of the Agreement sets out the pay for a Claims Assist Flexible Roster Employee, which includes a 10% allowance, and that Clause 9.10(e) provides for a further payment to be made to the employees where they work a large number of weekends:

“Claims Assist Flexible Roster employees will not be rostered to work more than 15 Saturdays and 7 Sundays per year. If a Claims Assist Flexible Roster employee is required to work more than 15 Saturdays and 7 Sundays per year, they will be paid the allowances set out in clause 9.6.”

[39] The effect of Clause 9.6 is to provide for afternoon, Saturday and Sunday shift loadings.

[40] Taken together, these matters allow the Commission to be satisfied that Claims Assist Employees, as well as all other employees working under the Agreement will be better off overall working under the Agreement.

CONCLUSION

[41] Having considered the matter of the classification descriptors, and relying on the material filed by both parties and the oral submissions provided in the hearing, I am satisfied that the correct classification comparison for Grade B employees in the Agreement is Level 2 in the Award.

[42] I am satisfied that the better off overall test has been passed.

[43] The Employer has provided written undertakings. A copy of the undertakings is attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement. The undertakings are taken to be a term of the agreement.

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

[45] The Finance Sector Union of Australia being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers the organisation.

[46] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 25 December 2020. The nominal expiry date of the Agreement is 18 June 2023.

COMMISSIONER

Appearances:

Mr J. Parkinson for the Applicant

Ms L. Sutherland for the FSU

Hearing details:

Melbourne (via video conference);

15 December;

2020.

Annexure A

 1   Email from FSU attaching updated spreadsheet, 26 November 2020.

 2   FSU’s Outline of Submissions, 4 December 2020, [8]-[10].

 3   Applicant’s Outline of Submissions, 10 December 2020, [7].

 4   Ibid, [16].

 5   Witness Statement of Michelle Crawford, 10 December 2020, [10].

 6   Applicant’s Outline of Submissions, 10 December 2020, [24].

 7   Witness Statement of Michelle Crawford, 10 December 2020.

 8   Applicant’s Outline of Submissions, 10 December 2020, [37].

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