Red Energy Pty Limited
[2024] FWC 627
•8 MARCH 2024
| [2024] FWC 627 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement
Red Energy Pty Limited
(AG2023/4746)
RED ENERGY PTY LTD ENTERPRISE AGREEMENT 2023
| Electrical power industry | |
| DEPUTY PRESIDENT GOSTENCNIK | MELBOURNE, 8 MARCH 2024 |
Application for approval of the Red Energy Pty Ltd Enterprise Agreement 2023
The applicant, Red Energy Pty Limited is an Australian energy retailer, which sells electricity and gas to residential and business customers in Victoria, New South Wales, South Australia and Queensland, and is wholly owned by Snowy Hydro Limited. The applicant made an enterprise agreement entitled the “Red Energy Pty Ltd Enterprise Agreement 2023” (Agreement) with employees covered by the Agreement when, on 18 November 2023, a majority of employees who cast a valid vote in the Agreement approval ballot voted to approve the Agreement. Eight hundred and eighty-one employees were employed at the time of the vote, 789 of those employees cast a valid vote, and 511 of these employees voted to approve the Agreement. On 1 December 2023, the applicant applied under s 185 of the Fair Work Act 2009 (Cth) (Act) for the Commission to approve the Agreement.[1]
The Agreement covers the applicant’s employees engaged across Australia in the positions set out in the classifications in Annexure A of the Agreement and who were subject to the Operations Employee Collective Agreement 2009, the Field Sales Employee Collective Agreement 2009, or are new employees. The classifications for which the Agreement provides cover employees in particular Sales, Customer Management and Administration roles, the majority of which are customer facing roles. Classifications also provide for employees engaged in Team Leader and Manager roles who are specifically responsible for the day-to-day supervision and management of the Sales and Customer Management employees.
The Australian Municipal, Administrative, Clerical and Services Union (ASU) is an organisation registered under the Fair Work (Registered Organisations) Act 2009 (Cth), entitled to represent the industrial interests of at least some of the employees covered by the Agreement and was a bargaining representative for the Agreement. The ASU opposes the approval of Agreement but has given notice pursuant to s 183 of the Act that if the Agreement is approved, it wants the Agreement to cover the ASU.[2] The ASU opposes the Agreement’s approval on several bases. The ASU contends the Agreement does not pass the better off overall test (BOOT), that it contains terms which contravene s 55 of the Act, that its dispute resolution provision does not meet the requirement in s 186(6) and that the Agreement was not genuinely agreed to by the employees covered by it,[3] although the genuine agreement contention was not ultimately pressed in its written submissions.[4] I deal with the remaining three bases of objection below. The parties have filed written materials pursuant to varied directions I made on 30 January 2024 and have agreed that the application may be determined on the papers – a course I consider appropriate in the circumstances.
BOOT
The relevant reference instruments for the purpose of assessing whether the Agreement passes the BOOT are the Electrical Power Industry Award 2020 (EPIA) and the General Retail Industry Award 2020 (GRA). The applicant pays its employees, including those covered by the Agreement, on an annualised salary basis. The Agreement contains the minimum bases salaries to which employees are entitled in each classification, but it does not set out in every, and, perhaps in most cases, actual salaries or rates of pay received by employees covered by the Agreement. These remuneration arrangements are set out in clause 5 of the Agreement (which should be read with Annexure A, and specifically Table 3 therein), and which respectively provide:
5. REMUNERATION
5.1. Salary rates
The following pay increases will apply:
(a) 4.5% pay increase from the first full pay period on or after 1 July 2023;
(b) 4% pay increase from the first full pay period on or after 1 July 2024;
(c) 3.5% pay increase from the first full pay period on or after 1 July 2025; and
(d) 3% pay increase from the first full pay period on or after 1 July 2026.
The above percentage increases will not apply to an Employee that receives a 'No' for Values, provided that the minimum annual base salary remains equal to or greater than the payments required under the applicable award including each of the items set out in clause 5.4 below. An Employee that has been assessed as a 'No' for Values would generally have received formal or informal counselling or performance management within the relevant period. The Employee would also generally have been made aware that the performance or conduct concerns will have implications on the values assessment.
If an Employee receives a 'No' for Values it means that they have failed to uphold Red Energy's values at all times and/or is the result of poor performance or conduct.
5.2. Reconciliation process for 'No' for Values
Red Energy will, in respect of each Employee who receives a 'No' for Values, conduct a reconciliation process to ensure the total remuneration paid to the Employee under the Agreement during the relevant period, is not less than what they would have been paid under the applicable award, and will pay the Employee the amount of any short-fall identified.
5.3. Minimum base salary
Employees' minimum annual base salary for all working hours is set out in Annexure A.
In addition to salary, Sales Employees will be eligible to earn commission in accordance with Red Energy's sales commission scheme. The sales commission scheme does not form part of this Agreement and may be changed at Red Energy's discretion at any time.
5.4. Composition of salary
In developing Employees' minimum annual base salaries, Red Energy has given specific consideration to a range of factors, including (but not limited to):
(a) base hours of 38 per week;
(b) allowances for disabilities and work conditions;
(c) ability allowances;
(d) locality payments;
(e) market salary information;
(f) licence payments, registration or qualification allowances; and
(g) annual leave loading.
No other payments will be made to Employees except as provided by this Agreement.
5.5. Payment method
Employee salaries will be paid fortnightly into each Employee's nominated bank account by Electronic Funds Transfer.
5.6. Superannuation
On behalf of its Employees, Red Energy will maim a superannuation payment based on the required percentage under the Superannuation Guarantee Administration Act 1992 each calendar month.
5.7. Salary sacrifice
Employees may request that Red Energy enter into a salary sacrifice arrangement. If the proposed arrangement is lawful and agreed to by Red Energy then:
(a) the salary sacrifice contributions from the pre-tax normal salary amount may be utilised for improvements to superannuation, or any other form of salary sacrifice approved by the Australian Taxation Office; and
(b) Employees agree to bear those costs, including Fringe Benefits Tax (FBT), associated with the arrangement so it is cost-neutral to Red Energy.
5.8. Travel allowance
Sales Consultant (Field) and Field Sales Team Leader Employees required to stay away from their usual place of residence for 1 or more nights in servicing their allocated area shall be paid an additional allowance of $40 per day.
5.9. Deductions
In the event that Red Energy overpays an Employee's salary, or some other benefit, Red Energy may recover the amount of the overpayment by deducting it from subsequent payments or from an Employee's final pay. Red Energy may also recover expenses or costs and non-payment of any accounts held by the Employee with Red Energy by making deductions from payments or from the Employee's final pay.
In these circumstances, Red Energy will give the Employee written notification of its intention to recover the expense, the amount to be recovered and a full explanation of the reasons for the deduction.
Where an Employee is absent from work without Red Energy's approval or without a proper reason, such absence will be unpaid. Where this occurs the Employee will be notified.
5.10. Reconciliation process for Sales Consultant (Field) Employees
Red Energy will conduct a reconciliation process in accordance with Annexure D in respect of Employees employed in the position of Sales Consultant (Field) and working the roster patterns identified in the Annexure.
. . .
Table 3: Minimum Annual Base Salaries
Position
From 1 July 2023 From 1 July 2024 From 1 July 2025 From 1 July 2026 Sales Consultant (Field) $51,850.00 $53,924.00 $55,811.34 $57,485.68 Sales & Brand (SME) $51,850.00 $53,924.00 $55,811.34 $57,485.68 Sales Consultant (Moves) $51,850.00 $53,924.00 $55,811.34 $57,485.68 Sales Consultant (Telesales) $51,850.00 $53,924.00 $55,811.34 $57,485.68 Customer Service & Sales Representative $52,250.00 $54,340.00 $56,241.90 $57,929.16 Customer Solutions Consultant $60,850.00 $63,284.00 $65,498.94 $67,463.91 Customer Initialisation Specialist $60,850.00 $63,284.00 $65,498.94 $67,463.91 Receptionist $60,850.00 $63,284.00 $65,498.94 $67,463.91 Customer Assist Specialist $60,850.00 $63,284.00 $65,498.94 $67,463.91 Quality Control Coordinator $60,850.00 $63,284.00 $65,498.94 $67,463.91 Field Sales Team Leader $65,000.00 $67,600.00 $69,966.00 $72,064.98 Customer Management Expert $66,750.00 $69,420.00 $71,849.70 $74,005.19 Customer Service & Sales Expert $66,750.00 $69,420.00 $71,849.70 $74,005.19 Sales Operations Administrator $71,600.00 $74,464.00 $77,070.24 $79,382.35 Team Manager – Customer Management $76,300.00 $79,352.00 $82,129.32 $84,593.20 Team Manager – Telesales $76,300.00 $79,352.00 $82,129.32 $84,593.20 Team Manager – Quality Control $76,300.00 $79,352.00 $82,129.32 $84,593.20 Customer Service & Sales Team Leader $76,300.00 $79,352.00 $82,129.32 $84,593.20
The ASU contend that the Agreement does not pass the BOOT, having regard to several matters.
First, the ASU contends that the minimum base rate of pay for employees under the Agreement may be inadequate as the year-on-year increases are conditional upon performance. In essence, this contention is based on a view that employees who are assessed as a “‘No’ for Values” (NFV) do not receive increases in salary for which clause 5.1 of the Agreement provides. It contends that, on a plain language reading of clause 5.1, an employee receiving amounts strictly pursuant to the Agreement may not receive the wage increases as long as the employee is still receiving above award rates. Consequently, the ASU says that when assessing whether the Agreement passes the BOOT, I should treat the base rates as being frozen for the duration of the Agreement as there is no assurance that employees will receive increases at all.
These contentions are rejected and the construction for which the ASU contends suffers from the error of reading clause 5.1 of the Agreement in isolation rather than in context, both of clause 5 and the Agreement as a whole.
As earlier noted, the Agreement does not specify the actual salaries - only the minimum base salaries for employees. The minimum base salaries are set out in Table 3 of Annexure A, which is earlier reproduced. Clause 5.3 of the Agreement provides that the “[e]mployees' minimum annual base salary for all working hours is set out in Annexure A”. Table 3 of Annexure A makes clear that there are different minimum based salaries applicable to each classification from the dates specified in the first row of the table. Clause 5.1 sets out the annual salary increases that will be applied to the actual salaries of employees covered by the Agreement during the period from 1 July 2023 to 1 July 2026. Table 3 of Annexure A sets out what the minimum base salaries will be during the same period. Thus, although the percentage increases specified in clause 5.1 will not apply to an employee who receives a NFV, that employee will nevertheless receive the variable stipulated minimum base salary during the period specified in Table 3 of Annexure A. And so, the contention that such an employee will not receive increases at all is incorrect. Table 3 of Annexure A has built in increases to which the employee is, during the specified period, as a minimum entitled.
As at test time the rates of pay in Table 3 of Annexure A of the Agreement are between 5.74% and 25.21% above the GRA and between 4.22% and 36.01% above the EPIA, as the table below shows.
Modern Award Classification Agreement Classification Modern Award Rate Agreement Rate Percentage Difference General Retail Award 2020 Retail Employee Level 1 Sales Consultant (Field) $24.73 $26.15 5.74% Retail Employee Level 1 Sales & Brand (SME) $24.73 $26.15 5.74% Retail Employee Level 4 Field Sales Team Leader $26.18 $32.78 25.21% Electrical Power Industry Award 2020 Administrative Grade 2 Sales Consultant (Moves) $25.09 $26.15 4.22% Administrative Grade 2 Sales Consultant (Telesales) $25.09 $26.15 4.22% Administrative Grade 2 Customer Service & Sales Representative $25.09 $26.35 5.03% Administrative Grade 2 Customer Solutions Consultant $25.09 $30.69 22.31% Administrative Grade 2 Customer Initialisation Specialist $25.09 $30.69 22.31% Administrative Grade 2 Receptionist $25.09 $30.69 22.31% Administrative Grade 2 Customer Assist Specialist $25.09 $30.69 22.31% Administrative Grade 2 Quality Control Coordinator $25.09 $30.69 22.31% Administrative Grade 4 Customer Management Expert $29.06 $33.66 15.84% Administrative Grade 4 Customer Service & Sales Expert $29.06 $33.66 15.84% Administrative Grade 3 Sales Operations Administrator $26.55 $36.11 36.01% Administrative Grade 6 Team Manager – Customer Management $34.18 $38.48 12.58% Administrative Grade 6 Team Manager – Telesales $34.18 $38.48 12.58% Administrative Grade 6 Team Manager – Quality Control $34.18 $38.48 12.58% Administrative Grade 6 Customer Service & Sales Team Leader $34.18 $38.48 12.58%
The classification matching set out above is as contended by the applicant, some of which is disputed by the ASU. However, beyond the ASU making an assertion that its classification comparison ought be preferred[5] and later submitting that:
“. . . 8 positions have been cross referenced against the Administrative Grade 2 classification under the EPI award, despite the Applicant assigning 3 different pay levels across those positions. This discrepancy suggests (but is not determinative) that the Applicant assigns more responsibility on the shoulders of workers in those higher paid position that would be at odds with a low-level classification.
24. The ASU considers that the Administrative Grade 2 classification under the EPI award a low-level classification, intended to cover administrative officers and customer service officers with minimal experience.
25. The Applicant submits that the Administrative Grade 2 classification under the EPI should also extend to their ‘Customer Initialisation Specialists’, ‘Customer Assist Specialists’ and ‘Quality Control Coordinators’. These roles could also fit comfortably under Administrative Grade 3 . . .”[6]
it led no evidence nor provided any analysis of the duties of the employees in the disputed classifications despite having the opportunity to so do. Conversely, the applicant provided a detailed examination of the disputed classifications and set out its rationale for the classification matching for which it contends.[7] Save for that which I have extracted above, this analysis was not challenged by the ASU and that which appears above is an assertion without rationale. I accept the applicant’s detailed analysis and its classification matching for the purposes of making the BOOT assessment. And it follows that the ASU’s contention, that I should vary the Agreement under section 191A of the Act to remove the NFV condition,[8] fails.
Second, the ASU point to the fact that various penalties, allowances and loadings found in the reference instruments are not included in the Agreement, and the overtime rates for which provision is made are lower than that in the reference instruments. It contends that part-time and casual employees are particularly impacted by the Agreement in respect of these matters. Much of its contention as to the deleterious effects of the absence of particular penalties and allowances hangs off its assertion, by reference to its contended classification matching (which I have rejected above), that a number of roles for which the Agreement receive only marginal increases above the reference instruments.[9]
Clause 5.4 of the Agreement earlier set out identifies the various matters that have been taken into account or incorporated in setting the annual base salaries for ordinary hours of work. These include: base hours of 38 per week; allowances for disabilities and work conditions; ability allowances; locality payments; market salary information; licence payments; registration or qualification allowances; and annual leave loading. The minimum base salaries also include some compensation for additional hours worked.[10]
Clause 6.2 of the Agreement sets out the span of hours as follows:
“6.2 Span of hours
(a) Operations Employees
Operations Employees are required to work between the period of:
(i)7:00 am and 9:00 pm Monday to Friday; and
(ii)7:00 am and 6:00 pm on Saturday.
Casual Employees will not be required to work at any time outside the hours of 7:00 am to 6:30 pm Monday to Friday.
(b) Field Sales Employees
Field Sales Employees are required to work between the period of:
(i)9:00 am and 8:00 pm Monday to Friday; and
(ii)9:00 am to 6:00 pm on Saturday.”
The applicant contended, without demur, that:
employees work 37.5 ordinary hours per week made up of 5 days of 7.5 hours, with a half hour unpaid meal break (although employees are paid based on 7.6 hours);
work is organised to provide coverage over the span of hours for each employee group as set out in clause 6.2 of the Agreement;
rosters are organised to distribute “late-shifts” and Saturday shifts evenly among employees over either an 8 week or 12 week cycle. Over the course of a year, this results in:
oSales (Telesales) and Sales (Move) employees working 12 Saturdays and 18 late shifts;
oCustomer Service and Sales Representatives and Customer Initialisation Specialists (verification only) working approximately 12 Saturdays and 6 late shifts;
oCustomer Solutions Consultants working approximately 12 Saturdays and 12 late shifts; and
oSales (Field) employees working approximately 36 Saturdays and may be required to travel on up to 3 hours for 12 Sundays.
it does not operate shift work or employ shift workers within the definition of either of the reference instruments; and
with the exception of Sales (Field) employees, there are no employees who work Saturdays or late-shifts regularly or on a standing basis. And these shifts are distributed over the roster and only worked from time to time.
I accept these are the working patterns of the employees covered by the Agreement and that they are the reasonably foreseeable working arrangements or patterns of work under the Agreement. The applicant has provided an analysis of the working arrangements, which includes a comparison of earnings for working those arrangements under the Agreement and the applicable reference instruments.[11] The analysis included the penalty rates, loadings and allowances that would apply to employees in each position under the reference instruments, based on their reasonably foreseeable patterns of work under the Agreement. The ASU accepts the applicant’s employees covered by the Agreement are unlikely to be ‘shiftworkers’ under the reference instrument. In each case examined, employees earn more under the Agreement than the reference instrument. In sum, the Agreement payment regime appears to provide a sufficient margin to compensate employees for the differences between the additional payments they will receive under the Agreement and the penalty rates provided under the reference instruments for overtime or public holidays taking into account the reasonably foreseeable patterns of work. I accept the analysis.
Turning to the requirement to work reasonable additional hours and compensation therefor, the Agreement provides that employees may be required to work reasonable additional hours and it limits the number of additional hours that an employee may be required to work to 12 hours per week. Of course, an employee may, in accordance with the National Employment Standards (NES), refuse to work these (or some of these) additional hours if the additional hours are unreasonable. The applicant says that the 12-hour per week cap was included in the Agreement because it exceeds the additional hours that its employees actually work. And that there are only limited additional hours worked after the usual ending of work and from time to time an employee may work an additional shift. The effect of additional hours on all employee groups is included in the analysis in Annexure 2 and I am satisfied that it shows that the minimum base salaries for which the Agreement provides include sufficient compensation for such additional hours as are or will likely be worked.
As to the impact of other allowances for which the reference instruments provide and the Agreement does not, and which, the ASU argues may result in the Agreement not passing the BOOT. I accept, for the reasons to which I will shortly turn, the Agreement’s minimum base salaries sufficiently compensate employees for the penalties, loadings and allowances that are relevantly applicable to their working arrangements.
As to the GRA allowances:
First, the meal allowance, which is triggered when an employee is working particular overtime. Under the GRA, overtime is work in excess of ordinary hours of work or outside the span of hours. The span of hours under the Agreement and the GRA are relevantly the same, noting the Agreement does not provide for working ordinary hours on a Sunday. A meal allowance (or the requirement to provide a meal) is triggered under the GRA if three conditions set out in clause 19.2(a)(i)-(iii) are met, namely:
(i) the employee is required to work overtime of more than one hour on any day after the time at which the employee ordinarily finishes work for the day; and
(ii) the employee was not given at least 24 hours’ notice of that requirement; and
(iii) the employee cannot reasonably return home for a meal within the period of the meal break.
The applicant contended, again without demur, that its employees are generally given more than 24 hours’ notice if required to work additional hours after they would ordinarily finish work. I accept the contentions and so the circumstance conditioning the GRA entitlement is unlikely to regularly arise. The ASU’s contention that a meal allowance could reasonably be triggered over the course of the Agreement, is not supported by any evidence about working arrangements to contradict the Applicant’s asserted working arrangements. Moreover, whether an allowance could be reasonably triggered says nothing about how often that might be so. It is that which is relevant to the BOOT assessment, and I am satisfied on the material that the circumstance earlier noted, which conditions the GRA entitlement, is unlikely to regularly arise.
Second, the GRA requirement for reimbursement of additional travel costs, which applies to an employee required to work at a place other than their usual place of work for a period of up to 3 weeks. The applicant says that it does not and has not required an employee to work at a place other than their usual place of work for a period of up to three weeks. I accept this contention and so the question of travel costs reimbursement is unlikely to regularly arise.
Third, travel time reimbursement under the GRA applies to an employee who on any day is required to work at a place other than their usual place of work. The applicant says that there are no employees who on any day are required to work at a place other than their usual place of work. The ASU points to clause 5.8 of the Agreement, which provides that Sales Consultant (Field) and Field Sales Team Leader employees required to stay away from their usual place of residence for 1 or more nights in servicing their allocated area shall be paid an additional allowance of $40 per day. The ASU says the proposed agreement clearly foresees circumstances in which Sales Consultant (Field) and Field Sales Team Leaders may require the travel allowance under clause 5.8 of the Agreement, it appears feasible that these employees may be entitled to the travelling time reimbursement. But this contention misunderstands the GRA provision and clause 5.8 of the Agreement. The GRA provision is engaged when on any day an employee is required to work at a place other than their usual place of work. The usual place of work for Sales Consultant (Field) and Field Sales Team Leader Employees is not one place but their allocated area. The allowance in clause 5.8 is payable when these employees are required to stay away from their home for 1 or more nights in servicing their allocated area. It follows that the travel is not to a place other than their usual place of work, but within that place and so the GRA provisions are not engaged.
I therefore accept that the circumstances which would enliven travel time reimbursement under the GRA would unlikely arise.
Fourth, under the GRA, a motor vehicle allowance is payable to an employee if an employer requests an employee to use their own motor vehicle in performing their duties. The applicant says that it supplies a company vehicle to Sales Consultant (Field) employees who require a vehicle to perform their duties. This seems accepted by the ASU. The applicant also says that it does not provide a motor vehicle allowance as it does not request employees to use their own motor vehicle to perform their duties. The ASU contends that it is feasible that a Sales Consultant (Field) employee may be required to utilise their own vehicle at some stage during the course of the Agreement, particularly in circumstances where a company vehicle may need repairs or replacement. This is unsupported by evidence and is, respectfully, to clutch at straws. The applicant says it does not request employees to use their own motor vehicle to perform their duties and there is no evidence to contradict the applicant’s contention. I accept that the applicant does not request employees to use their own motor vehicle to perform their duties. The circumstances where under the GRA, a motor vehicle allowance is payable to an employee will not arise.
Fifth, under the GRA a first aid allowance of $12.94 per week is payable to a first aid qualified employee who is appointed by the employer to perform first aid duty. The applicant says that its Field Sales employees have first aid qualifications. It says there is only one first aid qualified employee per travelling team appointed to this position at any one time and employees are appointed on a variable basis only, with Team Leaders routinely performing these duties. It contends that the allowance is adequately compensated for in the minimum base salaries. I agree.
Sixth, the GRA provides that an employer must pay an employee the greater of 3 hours pay or time between when the employee leaves home until they return home, if the employee is recalled to work by the employer to perform specific duties on a day when they have completed their normal roster or did not work on that day. The applicant says that it does not recall, for any reason, employees to work to perform specific duties on a day on which they have completed their normal roster or did not work. The ASU says, without recounting how frequently, that it is feasible that an emergency may necessitate the recall of staff over the course of the Agreement. That may be so, but self-evidently, emergencies will be infrequent and so would unlikely result a significant BOOT consideration.
Turning then to impact of other allowances in the EPIA, the ASU raises several matters.
First, the EPIA provides that, if an employer requires an employee to be available for duty after normal working hours in accordance with an availability roster, the employee will be paid a weekly allowance (pro-rated) of either $179.21 or $258.86 depending on the number of weeks an employee is rostered on availability duty. The applicant says it does not provide an availability allowance as it does not require employees to make themselves available outside of hours on a rostered basis. The ASU contends that it is feasible that an emergency may necessitate the use of an availability allowance over the course of the Agreement. Two things may be observed about this contention. First, emergencies are unlikely to be frequent events. Second, the EPIA availability allowance is triggered by the requirement that an employee be rostered for availability not that the employee might be required to work in an emergency. There is no evidence that the applicant maintains an availability roster. The applicant says, and in the absence of any countervailing compelling reason, I accept, that it does not require employees to make themselves available outside of hours on a rostered basis. On this basis, the absence of such an allowance from the Agreement is not material to the BOOT assessment.
Second, the EPIA provides that a first aid allowance of $18.92 per week is payable to a first aid qualified employee who is appointed by the employer as a first aid officer. The applicant says that it does not appoint employees covered by EPIA to “perform first aid duty”. By this, I take the applicant to mean that it does not appoint such employees as first aid officers. The ASU points to WorkSafe’s compliance code, a non-binding code which recommends there is ‘at least one first aid officer available at the workplace at any one time’. The ASU says that it is feasible that the applicant will follow WorkSafe’s recommendations over the course of the Agreement and direct an employee otherwise covered by the EPIA to be a first aid officer.
This is not a dispute about the applicant’s adherence to non-binding compliance codes. The applicant says it does not appoint from within this group of employees. Moreover, the applicant likely complies with WorkSafe’s compliance code, because as earlier noted, in the workplace, there are other employees covered by the GRA who perform first aid duty. The recommendation is that “at least one first aid officer [be] available at the workplace at any one time”, not that at least one first aid officer be available for each designated workgroup or occupational grouping.
Third, the EPIA requires a meal allowance of $18.60 to be paid for overtime work of 2 or more hours, and in call back circumstances outside ordinary hours, on a weekend or public holiday, or rostered day off where the recall is for at least 2 hours. The applicant says it does not require employees to return to work (other than for pre-planned overtime) outside of ordinary hours on a Saturday, Sunday or public holiday. It also points to the retail energy regulations, which prevent sales calls being made after 6.00 pm. This addresses meal allowances for recalls and some, but not all, overtime, which might attract the allowance under the EPIA. I accept, as the ASU contends, that it is feasible an employee will be required to work overtime for over 2 hours and less than 4 hours and therefore be entitled to a meal allowance in accordance with the EPIA. But I consider, having regard to the likely frequency of such overtime in light of the existing and likely continuing work patterns earlier discussed, that the circumstances triggering the allowance will be infrequent and are more than compensated for in the minimum base salaries for which the Agreement provides.
Fourth, the motor vehicle allowance in the EPIA becomes payable if an employee, by prior agreement with the employer, uses a private motor vehicle for work purposes where no company vehicle is provided or available. The applicant points out that the EPIA covers all employee groups covered by the Agreement except for Sales Consultant (Field), Sales & Brand (SME) or Field Sales Team Leader employees. The applicant does not provide a motor vehicle allowance to the employees covered by the EPIA because these employees work at head office or at home and therefore do not require use of a vehicle for work purposes. The ASU does not contest this and so the absence of an allowance for work-related private motor vehicle uses does not appear to be relevant to the BOOT assessment.
Fifth, the EPIA requires an employer to pay employees all reasonable fares, meals, accommodation and incidental expenses incurred by the employee on business related travel, where the employer requires an employee to travel in connection with work. The applicant does not require employees covered by the EPIA to travel for work. Consequently, the circumstances that would give rise to any payment under the EPIA will not arise. It follows that I do not accept the ASU’s contention that as the applicant has said if employees undertake work related travel they would be reimbursed for such costs in accordance with company policy, it is feasible that EPIA award covered employees may be entitled to payment, and this would have a material effect on the BOOT assessment. The circumstances posited by the applicant would be the exception, not the rule, and so the fact that an occasional entitled under the EPIA might be triggered is unlikely to move the dial very much at all in assessing whether the Agreement passes the BOOT.
The ASU raises other matters. It maintains that the provisions in the Agreement dealing with redeployment of employees to other roles are detrimental to employees with respect to termination and redundancy entitlements compared to the reference instruments. The concern relates to clauses 2.1 and 2.8 of the Agreement. The former provides:
“2.1. Employees' roles and responsibilities
Red Energy is committed to focusing on its customers' needs. Red Energy operates as a team and while Employees may occupy a particular position at any given point in time, this is always subject to the requirements of the team. Red Energy may redeploy Employees from time to time to best assist in achieving its business objectives, to another position that is within their skills and knowledge, provided that their overall terms and conditions are overall no less favourable than the terms of this Agreement. Before any Employee is redeployed to another position in accordance with this clause, Red Energy will consult with the affected Employee.
Employees acknowledge and agree that as the business changes, their roles and responsibilities may also change.”
The latter provides:
“2.8. Employees' role
Each Employee will be provided with a position description by Red Energy.
Employees agree to fulfil the responsibilities set out in the position description in accordance with this Agreement.
Employees will work as required to the extent of their knowledge, skills and abilities without limitation to undertake any task required. In accordance with clause 2.1, Red Energy may redeploy an Employee to a suitable position within the business. In the event that an Employee is redeployed, the following conditions will apply:
(a) if the relevant salary for the Employee's new position is lower than their current role, the Employee's existing salary (and benefits) will be preserved;
(b) the Employee will be covered by the relevant workplace agreement that applies to the new role; and
(c) if the Employee's new role is not subject to a workplace agreement they will remain covered by this Agreement.”
Read together, the applicant may from time to time redeploy an employee to a different role within the organisation if this best assists in achieving its business objectives. The different role is to a suitable position within the business which will be within the employee’s skills and knowledge. Provided that terms and conditions are overall no less favourable than the terms of the Agreement. And if the relevant salary for the employee’s new position is lower than their current role, the employee’s existing salary (and benefits) will be maintained. Consultation before redeployment is required. I accept that this might result in an effective demotion in status although not minimum base salary. However, this may impact the actual salary an employee receives, because the guarantee that the “overall terms and conditions are overall no less favourable” as between the positions is confined to the “terms of this Agreement”. However, the actual salary is payable as a matter of contract, not the Agreement. The over Agreement contractual terms cannot be unilaterally varied by the exercise of a redeployment right under the Agreement. Consent to a variation would be required.
As to the redundancy concerns, whether an employee is entitled to redundancy pay in a given circumstance will depend on the terms of the NES. If the NES conditions are met and an exception is not triggered, the NES entitlement will be payable. The reference instrument provisions provide additional benefits if, because of redundancy, an employee is transferred to new duties to which a lower ordinary rate of pay applies. In those circumstances, the employer is required to give notice consistent with the NES employment termination provisions or pay the difference in salary as between the existing role and the transferred role for the period of notice not given. The Agreement is more beneficial since it maintains the higher entitlement on an ongoing basis. In any event, the prospect of redundancy is a contingent event, which may not arise at all during the Agreement’s operation.
For these reasons, the operation of clauses 2.1 and 2.8 of the Agreement do not raise any material BOOT concerns.
The ASU raises concerns that overtime is not payable for work performed outside of the span of hours contained in clause 6.2 of the Agreement, unless these are overtime hours for the purposes of the Agreement. I agree with the applicant that the issue does not arise because, according to the foreseeable pattern of work, employees will only be required to work during the spread of hours set out in clause 6.2 and will only be rostered to work their ordinary hours during the relevant spread for their position.
For the reasons given, I am satisfied that none of the matters the ASU raises result in the Agreement not passing the BOOT.
However, noting the applicant’s detailed analysis proceeds on the basis of full-time employment, I am concerned that part-time actual and prospective employees covered by the Agreement may not be better off overall. The Agreement provides for part-time employment and provides that the applicant will inform part-time employees of their regular pattern of work, including the number of hours worked per day. Nothing in the Agreement prevents a part-time employee being engaged to work only on Saturdays. The GRA provides for ordinary hours of work on a Saturday to be paid at 125% while the EPIA provides for such work to be paid at 150%. As earlier noted, the Agreement rates are between 5.74% and 25.21% above the GRA and between 4.22% and 36.01% above the EPIA. The Agreement rates include work on a Saturday, the GRA and EPIA rates do not.
Thus, a part-time actual or prospective employee engaged to work only on Saturdays will in the preponderance of classifications, not be better off overall if the Agreement applied than if the GRA or EPIA applied. This kind or type of employment is, as I have indicated, permitted by the Agreement and there is nothing before me to suggest that it is not reasonably foreseeable at the test time. I will give the applicant an opportunity to provide an undertaking to address this concern.
Aside from the concern expressed above, considering the more and less beneficial terms of the Agreement, I would otherwise be satisfied the Agreement would pass the BOOT.
Section 55 and the NES
The ASU raises two NES-related matters in support of contention that the Agreement contravenes s 55 of the Act. First, it says the Agreement does not contain a definition of “shiftworker”, as required by s 196 of the Act. That section is only engaged if: an employee is covered by the Agreement and a modern award that is in operation and covers the employee defines or describes the employee as a shiftworker for the purposes of the NES. Each reference instrument has a shiftworker definition, but not one which will apply to any employee covered by the Agreement. There are no employees covered by the Agreement who are rostered to work on a Sunday. Work on a Sunday is key to both definitions. Clause 28.2(1) of the GRA provides that an employee is a shiftworker for the purposes of the NES if the employee is “regularly rostered to work on Sundays and public holidays in a business in which shifts are continuously rostered 24 hours a day for 7 days a week”; while clause 21.2 of the EPIA defines a shiftworker for the purposes of the NES, as an employee who “works a roster and who, over the roster cycle, may be rostered to work ordinary time shifts on any of the 7 days of the week” and “is regularly rostered to work on Sundays and public holidays.” In its reply submission, the ASU appropriately conceded that employees covered by the Agreement are unlikely to be considered “shiftworkers” for the purposes of the NES, within the meaning of clauses 28.2(1) of the GRA or 21.1 of the EPIA.
Next, the ASU says that clause 5.9 of the Agreement provides the applicant with an option to recover over-payments by making a deduction from amounts referable to untaken annual leave from an employee’s final pay on termination of employment contrary to the NES. But clause 5.9 cannot be read in isolation. It must be read with clause 1.5, which provides that the Agreement:
“. . . is subject to, and will be applied in accordance with, the National Employment Standards (NES). Nothing contained within this Agreement is intended to provide for conditions less than the NES. Where a provision of the NES provides a greater benefit to Employees than a provision of this Agreement, the NES will prevail to the extent of that benefit.”
Clause 1.5 of the Agreement is a complete answer to the ASU’s concerns.
Section 186(6) – dispute resolution
Finally, the ASU contends that the dispute resolution process as set out in Schedule B.2 of the Agreement does not comply with the requirements of s 186(6) of the Act in that, according to the ASU, the procedure does not enable employees to utilise the procedure for disputes relating to the NES, the procedure does not provide representation rights to employees and it does not provide for arbitration or mediation. The applicant accepts that the procedure does not expressly refer to disputes in relation to the NES but says that any such dispute would fall within this procedure. I am not persuaded that that is correct. I accept that the applicant does not intentionally seek to exclude NES disputes from the procedure. I will consider an appropriate undertaking.
The procedure is also silent on the issue of representation of an employee for the purpose of the disputes procedure, and while I accept that the applicant respects the rights of employees to be represented, should they wish to do so, and the clause does not prevent this from occurring, s 186(6) of the Act requires a disputes procedure that allows for the representation of employees covered by the Agreement for the purposes of that procedure. In my view, that means the procedure must let an employee be represented in express terms. The prevision at issue merely does not erect any barrier, but that is not enough. I will consider an appropriate undertaking.
The procedure allows the Commission to conciliate disputes. By so doing, the procedure allows the Commission to settle relevant disputes, and so in this respect it complies with s 186(6) of the Act. Although the procedure does not provide for arbitration or mediation, in the circumstances, neither is required for a dispute resolution term to comply. Consequently, the ASU’s contention that the dispute resolution process does not comply with s 186(6) because it does not empower the Commission to mediate or arbitrate a dispute is misconceived.
No other issues have been raised. On the basis of the material before me, save for the concerns identified in [40]-[41], [46] and [47], I am otherwise satisfied that each remaining requirement of ss 186, 187 and 188 as are relevant to this application for approval of the Agreement have been met. As to the concerns in [40]-[41], [46] and [47], the applicant may file any undertakings within 14 days of the date of this decision to address to concerns raised. Before doing so, the applicant must consult any bargaining representative about the undertakings and report to my Chambers the result of that consultation when it files any undertakings.
If acceptable undertakings are given and they otherwise comply with the Act’s requirements, I will approve the Agreement and note that the ASU has given notice that it wants the Agreement to cover it.
DEPUTY PRESIDENT
[1] Form F17A – Employer’s declaration in support of an application for approval of an enterprise agreement (other than a greenfields agreement) – notification time before 6 June 2023 at p 30
[2] Form F18 – Declaration of employee organisation in relation to an application for approval of an enterprise agreement (other than a greenfields agreement) at p 4
[3] ASU’s Points of Opposition, 22 December 2023
[4] ASU’s outline of submissions, 12 January 2024, particularly [1]-[3]
[5] ASU’s outline of submissions, 12 January 2024, at [21]-[22]
[6] ASU’s material in reply, 2 February 2024, at [23]-[25]
[7] Applicant’s outline of submissions, Annexure 1
[8] ASU’s outline of submissions, 12 January 2024, at [26]
[9] Ibid at [27]
[10] Applicant’s outline of submissions at [16]
[11] Applicant’s outline of submissions, Annexure 2 (head Annexure 1 but titled Annexure 2 –see email from the Applicant’s solicitors dated 25 January 2024 and the attachments thereto)
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