RACWA Holdings Pty Ltd

[2021] FWC 6121

[2021] FWC 6121

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees

RACWA Holdings Pty Ltd
(AG2021/7716)

Banking finance and insurance industry
DEPUTY PRESIDENT BEAUMONT	PERTH, 14 OCTOBER 2021

Application for an order relating to instruments covering new employer and transferring employees.

[1] RACWA Holdings Pty Ltd (RACWA)has applied for an order under s 318 of the Fair Work Act 2009 (Cth) (Act) relating to the transfer of one employee (Transferring Employee) 1 from RAC Insurance Pty Ltd (RAC) to its business. The Transferring Employee is currently covered by the RAC Insurance Enterprise Agreement 20202 (Agreement).

[2] RACWA and RAC are related entities of RAC Group. 3 The Transferring Employee was previously employed by RAC in the role of Marketing Communications Manager – Security. However, following an organisational change, the RAC Group marketing function was moved to the ‘Member Value and Connection Function’; this department forms part of RACWA.

[3] The Transferring Employee accepted permanent employment as a Marketing Communications Manager – Security, with RACWA. The offer of employment with RACWA was not contingent on the order that RACWA now seeks. The transfer of employment took effect on 1 July 2021, and the work that the Transferring Employee is now performing is the same, or substantially similar, to the work she performed for RAC.

[4] RACWA was content for the application to be determined on the papers. The application contained detailed submissions and was supported by the Statutory Declaration of the Transferring Employee. 4

[5] In short, I have reviewed the application documentation and the accompanying material. These documents outline the factual circumstances which have given rise to the application. Further, the submissions contained in the application address the relevant legislative requirements which provide a proper basis for the making of the order sought.

[6] Relevantly, the proposed order reads:

An order pursuant to s 318(1)(a) of the Act that the Agreement will not cover the Transferring Employee who will perform, or is likely to perform, work for RACWA.

[7] I am satisfied this circumstance is a transfer of business and that the Agreement is a transferable instrument. If the order under s 318(1)(a) was not made, then by virtue of s 313(1)(a), the Agreement would cover the Transferring Employee notwithstanding her employment with RACWA. I have considered all the factors set out in s 318(3) and have concluded that it is appropriate and not contrary to the public interest to make the order sought.

[8] My detailed reasons for granting the order follows.

Legislative framework

[9] Section 318 of the Act sets out the circumstances in which an order such as that sought by RACWA may be made by the Commission:

318 Orders relating to instruments covering new employer and transferring employees

Orders that the FWC may make

(1) The FWC may make the following orders:

(a) an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;

(b) an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.

Who may apply for an order

(2) The FWC may make the order only on application by any of the following:

(a) the new employer or a person who is likely to be the new employer;

(b) a transferring employee, or an employee who is likely to be a transferring employee;

(c) if the application relates to an enterprise agreement—an employee organisation that is, or is likely to be, covered by the agreement;

(d) if the application relates to a named employer award—an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (b).

Matters that the FWC must take into account

(3) In deciding whether to make the order, the FWC must take into account the following:

(a) the views of:

(i) the new employer or a person who is likely to be the new employer; and

(ii) the employees who would be affected by the order;

(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment;

(c) if the order relates to an enterprise agreement—the nominal expiry date of the agreement;

(d) whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace;

(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;

(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;

(g) the public interest.

Restriction on when order may come into operation

(4) The order must not come into operation in relation to a particular transferring employee before the later of the following:

(a) the time when the transferring employee becomes employed by the new employer;

(b) the day on which the order is made.

Consideration of matters that the Commission must take into account

[10] Without recounting the particulars set out in the application or in the material accompanying the application, I am persuaded, having regard to that material, and taking into account the matters in s 318(3) of the Act, that an order should issue. I am satisfied that:

a) RACWA has standing to make the application;

b) the Transferring Employee is aware that the effect of the application is to:

i. move her position with RACWA outside the scope of the Agreement;

ii. render her position with RACWA both award and enterprise agreement free;

iii. have the terms and condition of her employment primarily governed by her contract of employment;

c) having had regard to the terms and conditions in her contract of employment, the Transferring Employee is of the view that she will benefit from the order sought as under her employment contract she receives remuneration that is 12.17% above the remuneration under the Agreement;

d) the application of the Agreement (a transferable instrument) to one employee will interfere with RACWA’s business synergies considering its other employees are not covered by a modern award or enterprise agreement. By way of example, different requirements will operate for the Transferring Employee regarding rostering, normal span of hours, overtime and penalty payments in comparison to her colleagues;

e) if the order is not granted, RACWA will endure the administrative inconvenience of managing one set of working arrangements for non-award covered employees and another set for the Transferring Employee who is covered by the Agreement;

f) whilst the Transferring Employee would lose several benefits under the Agreement if the order sought is granted, including volunteer leave, unplanned events leave, guaranteed salary increases and the accrual of personal leave at 12 days per year (after three years of service) instead of 10 days per year, the Transferring Employee is resolute in her support of the application; and

g) there are no matters about which I am aware that would render the making of the order contrary to the public interest. The goals that would be achieved by making the order, namely of business synergy, greater earning potential, as well as the fact that the Transferring Employee had accepted the new position with RACWA, are all matters that are concordant with the public interest.

Conclusion

[11] In accordance with s 318(4), the Order 5 shall have effect from the date of the Order.

DEPUTY PRESIDENT

Appearances:

Hearing details:

Final written submissions:

Printed by authority of the Commonwealth Government Printer

<AE509821  PR734869>

 1   Statutory Declaration of Ms Penelope Newcombe in support of the Applicant’s Application.

 2   [2020] FWCA 6744; PR725435.

 3   Form F40 – Application for orders in relation to a transfer of business.

 4   Statutory Declaration of Ms Penelope Newcombe in support of the Applicant’s Application.

 5   PR734905.