Regis Aged Care Pty Ltd T/A Regis
[2024] FWC 846
•3 APRIL 2024
| [2024] FWC 846 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
Regis Aged Care Pty Ltd T/A Regis
(AG2024/522 & AG2024/523)
| Aged care industry | |
| COMMISSIONER SIMPSON | BRISBANE, 3 APRIL 2024 |
Application for an order relating to instruments covering new employer and transferring employees
Applications have been made by Regis Aged Care Pty Ltd T/A Regis (Regis / the Applicant) to the Fair Work Commission (the Commission) for orders pursuant to s.318 of the Fair Work Act 2009 (the FW Act).
On 4 March 2024, matters AG2024/522 and AG2024/523 (the Applications) were both allocated to my chambers. The Applications arise from a common transaction (namely, a proposed transfer of business which is scheduled to occur on 8 April 2024) and relate to the same workforce. AG2024/522 relates to support staff, while AG2024/523 relates to nursing staff.
On 4 March 2024, the Applicant made a request that both matters be heard together. It was determined that this was the most efficient way to deal with the Applications and accordingly, I proceeded to deal with the Applications concurrently.
Orders Sought
The Applicant seeks orders from the Commission pursuant to s 318 of the FW Act that the Gold Coast Homestead - Nurses Enterprise Agreement 2012 (GCH Nurses Agreement) and the Gold Coast Homestead – Support Staff Enterprise Agreement 2012 (GCH Support Staff Agreement) do not apply to the employment of employees whose employment transfers to the Applicant from CPSM Pty Ltd ACN 145 835 981 (CPSM), and that in lieu the Applicant’s own industrial instruments apply ie:
(a)for nursing staff (AG2024/523), the Regis Aged Care Registered Nurses, Enrolled Nurses and Assistants in Nursing Queensland Agreement 2022 (Regis Nurses Agreement), with a nominal expiry date of 30 June 2024; and
(b)for support services staff (AG2024/522), the Regis Aged Care Support Services Staff, Queensland Agreement 2018 (Regis Support Services Agreement), with a nominal expiry date of 31 December 2022;
(together, the Applicant’s Instruments).
BACKGROUND
Directions Hearing
A Directions Hearing was held on 13 March 2024. This was attended by the Applicant, AWU and the QNMU. Subsequent to this listing, Directions were issued for the Applicant to serve a copy of the F40 Application with attachments on the employees as well as a copy of the Directions. The Directions also provided that if any transferring employee or union wished to be heard on the matter, they were to provide any views in relation to the Application by 28 March 2024.
Commission Analysis
A Commission analysis comparing the GCH Agreements and Regis Agreements was also sent to the parties on 18 March 2024. In summary, this indicated that while the agreements provide most provisions substantially the same as each other, the GCH Agreements are either silent or provides some less beneficial terms when compared to the Regis Agreements and as such, employees who transfer to the Regis Agreements can be considered better off than they would be under the GCH Agreements.
APPLICANT SUBMISSIONS
The Applicant filed submissions and witness statements of Claire Slattery and Millicent Mitchell in support of the Application.
Background
The Applicant is an aged care provider with 63 aged care facilities across Queensland, Victoria, New South Wales, Northern Territory, South Australia, Western Australia and Tasmania. The Applicant offers care for residents with all levels of care needs, from independent living to high care. Across these operations, the Applicant and its related entities currently employ over 9000 employees.
On 1 December 2023, the Applicant acquired 100% of the shares in CPSM. As a result, the Applicant became the operator of five aged care facilities variously located in Queensland at:
(a)Camp Hill Aged Care;
(b)Holland Park Aged Care;
(c)Lodges on George;
(d)Aspley Aged Care; and
(e)Magnolia Aged Care Coomera,
(together, CPSM facilities).
The Applicant submitted certain CPSM employees at the CPSM facilities are currently covered by either the GCH Nurses Agreement or the GCH Support Staff Agreement (together, GCH Agreements).
The GCH Nurses Agreement came into operation on 6 August 2012, and has a nominal expiry date of 30 June 2015. It applies to certain CPSM employees at each of the CPSM facilities who are employed in the Nursing Assistants, Enrolled Nurses and Registered Nurses classification streams. The QNMU is a party to the GCH Nurses Agreement.
The GCH Support Staff Agreement came into operation on 6 August 2012, and has a nominal expiry date of 30 June 2015. It applies to certain CPSM employees at each of the CPSM facilities who are employed in the Environmental Services and Diversional Therapy and Administration classification streams.
The Applicant submitted that whilst all employees at the CPSM facilities are presently employed with CPSM, the named employers in the GCH Agreements are Kingston Cove Pty Ltd as trustee for the Tweed City Trust, and Mardalo Pty Ltd as trustee for the Barbara Lowe Family Trust (legacy entities).
Since the acquisition of the CPSM shares on 1 December 2023, the Applicant has sought to determine how the GCH Agreements came to apply to employees at the CPSM facilities. The Applicant submitted based on the Applicant’s inquiries, and from the very limited records and other information made available to the Applicant by CPSM, the Applicant understands that:
(a)in or around 2015 (the exact date is not known), CPSM acquired the assets and business of the legacy entities, and as part of that acquisition, employees of the legacy entities transferred in their employment to CPSM; and
(b)the GCH Agreements therefore became “transferable instruments” (as defined in section 312 of the FW Act) and so transferred with those employees to CPSM.
Following enquiries made with CPSM and the Fair Work Commission, the Applicant has not located, and is not otherwise aware of, any orders made in relation to the GCH Agreements pursuant to either section 318 or section 319 of the FW Act.
The Applicant submitted it therefore appears that the GCH Agreements may in fact only apply to a small number of CPSM employees, being those who were employed at the time that CPSM acquired the legacy entities, whilst all other employees (ie those who commenced employment with CPSM after that acquisition) are covered by either the Nurses Award 2020 or the Aged Care Award 2020.
The Applicant’s inquiries into this matter are ongoing; however, given the very limited records and other information available to the Applicant, the Applicant considers that it may never be able to determine exactly which CPSM employees continue to be covered by the GCH Agreements.
Proposal to transfer the employment of CPSM employees to the Applicant
It is the Applicant’s intention to transfer the employment of all CPSM employees to the Applicant on 8 April 2024 (Transfer Date).
The Applicant submitted as at 1 March 2024 there were approximately 1,055 CPSM employees that the Applicant proposes will transfer to the Applicant on the Transfer Date (Transferring Employees). The Transferring Employees comprised approximately:
(a) 617 nursing staff;
(b) 395 support services staff;
(c) 15 clerical/administrative staff; and
(d) 28 managerial and senior managerial staff.
The Applicant submitted if these applications are not granted, then immediately after the Transfer Date, the Applicant will have split industrial coverage across its Queensland workforce at the CPSM facilities, such that the Transferring Employees working side by side will be either:
(a) covered by the Applicant’s Instruments, by virtue of the transfer of business provisions in the FW Act; or
(b) continue to be covered by the GCH Agreements, notwithstanding the transfer of their employment to the Applicant.
The Applicant submitted with the exception of the CPSM facilities, the Applicant’s Queensland aged care facilities are covered by common industrial regulation for respective groups of employees, including the Applicant’s Instruments.
The Applicant does not want different regulation at its various Queensland sites. The Applicant has a long, established practice of having staff in its aged care facilities in common work groups employed under uniform terms and conditions of employment. The Applicant typically does not have enterprise agreements that apply only to select facilities or to a single facility.
The strong preference of the Applicant, therefore, is that it be able to apply the Applicant’s Instruments to the CPSM employees upon the transfer of their employment to the Applicant, such that all nursing and support services employees of the Applicant in Queensland will be covered by common regulation.
Requirements of the FW Act
The Applicant submitted they have standing to bring these applications as a person who is likely to be the new employer of the Transferring Employees (subsection 318(2)(a)). The FW Act grants the Commission discretion to make certain orders in the case of a transfer of business.
Relevantly, in applications pursuant to section 318 of the FW Act, the Commission must also take account of the specific matters identified in subsection 318(3) of the FW Act ie:
(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.’
The Applicant submitted no single factor is determinative in the exercise of the Commission’s discretion.
The Applicant submitted the Commission’s discretion must be exercised in the context of section 309 of the Act, being the objects of Part 2-8 of the Act, which require a balance between the protection of employee terms and conditions of employment and the interests of employers being able to efficiently conduct their business.
The Applicant submitted in the exercise of its discretion under the FW Act, the Commission must also have regard to the more general requirements of sections 577 and 578 of the FW Act.
Applicant Consideration
The Applicant submitted in all of the circumstances of these applications, and having regard to the particular matters in subsection 318(3) of the FW Act of which the Commission must take account, there is a compelling case that the Commission should exercise its discretion to grant all of the orders sought by the Applicant.
Views of the new employer
A central motivating factor in the making of these applications is that the Applicant does not want its existing state based approach to industrial regulation to be eroded. Presently. the Applicant’s Instruments cover all of its existing Queensland facilities.
To continue that approach, the Applicant’s intention is for the Applicant’s Instruments to apply to all persons who are employed at the CPSM facilities, rather than the GCH Agreements continuing to apply to certain Transferring Employees.
The Applicant seeks to ensure that it has a unified and effective Queensland workforce, including by not having certain employees at the CPSM facilities (and potentially at other operations) working alongside people in the same role who are covered by a different industrial instrument.
The Applicant submitted this uniform approach to industrial regulation will assist the Applicant to prevent negative impacts on productivity at the CPSM facilities (and potentially at its other operations in Queensland), and maximise business synergy across the Applicant’s Queensland facilities. The Applicant submitted examples of the issues which are likely to arise if the applications are not granted and the GCH Agreements apply to certain Transferring Employees are provided in the Applicant’s evidence, including the witness statement of Claire Slattery.
The Applicant submitted factors of particular relevance to the concerns and objective of the Applicant, as detailed in Ms Slattery’s witness statement, include administrative and operational inefficiencies, and/or industrial disharmony, that are likely to arise if the applications are not granted, due to differences in:
(a)classification structures;
(b)progression through pay points;
(c)pay arrangements (including minimum rates of pay);
(d)work arrangements (including mandated break times and break durations, and shift patterns); and
(e)provisions in the GCH Agreements that are specific to CPSM’s operations and that are therefore either of no relevance to, or are not sufficiently reflective of, the Applicant’s operations.
Such differences are liable to:
(a)create difficulties in rostering arrangements at the CPSM facilities to the point where they become unworkable (in such a case, the simultaneous compliance with both sets of enterprise agreements might be impossible);
(b)complicate the Applicant’s ability to ensure quality of care is prioritised at all times, and that staff are always on hand to attend when care is required; and
(c)create confusion among staff, including in relation to their break and rostering entitlements.
The Applicant would also need to modify its payroll systems at the CPSM facilities to accommodate these varying arrangements. The Applicant submitted that this arrangement would become increasingly complex and costly, as more and more new employees - who would be covered by the Applicant’s Instruments - commence working at the CPSM facilities.
The Applicant submitted due to such differences between the GCH Agreements and the Applicant’s Instruments, there would also be an increased risk of the incorrect application of entitlements under the various enterprise agreements, particularly as the number of employees working at the CPSM facilities who are covered by the Applicant’s Instruments increases.
Finally, the Applicant considers that having the Applicant’s Instruments apply to the Transferring Employees will remove the present uncertainty over the legacy coverage of the GCH Agreements, which may otherwise not be satisfactorily resolved. The Applicant does not wish to be in the invidious position of not knowing, on an indefinite basis, precisely which employees are covered by the GCH Agreements, and which employees are covered by the Applicant’s Instruments.
The views of the employees who would be affected by the proposed orders
The Applicant submitted they have consulted with the Transferring Employees as part of the transfer of business process.
The Applicant submitted overall, the Transferring Employees’ response to the proposed transfer of their employment from CPSM to the Applicant has so far been positive, and no employees have thus far raised any concerns about the applications or the Applicant’s Instruments applying to them. Examples of minor queries raised by the Transferring Employees in response to the proposed transfer of their employment to the Applicant, and the proposed application of the Applicant’s Instruments, were contained in the Applicant’s evidence, namely the witness statement of Millicent Mitchell.
Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment
The Applicant submitted a precise comparison of industrial instruments to ascertain advantage/disadvantage is inherently difficult and it is no doubt why the test under the FW Act for approval of enterprise agreements is the better of overall test, rather than one based on line by line analysis.
The Applicant submitted similarly, in the case of transfer of business applications, the Supplementary Memorandum to the Fair Work (Transitional Provisions and Consequential Amendments Act) 2009 (Cth) confirms a requirement that the Commission satisfy itself that “overall, the employees would not be disadvantaged” (emphasis added).
A comparison of the Applicant’s Instruments with the GCH Agreements was undertaken by the Fair Work Commission, with the outcome of that comparison provided to the parties on 18 March 2024.
The Commission’s view, as confirmed in those comparisons, was that the GCH Agreements are either silent or provide less beneficial terms when compared to the Applicant’s Instruments and as such, CPSM employees - if they were to transfer to the Applicant’s Instruments - could be considered to be better off than they would be if the GCH Agreements continued to apply.
In relation to specific provisions of the GCH Agreements and the Applicant’s Instruments, there are:
(a)certain provisions that reflect CPSM’s own internal organisational and operational arrangements; and
(b)provisions in the Applicant’s Instruments which are superior to those in the GCH Agreements, including:
(i) for nursing staff:
(A)minimum rates of pay;
(B)spread of hours;
(C)allowances;
(D)penalty rates and loadings for casual employees;
(E)higher duties pay;
(F)paid parental leave; and
(G)paid study leave,
(ii) for support staff:
(A)minimum rates of pay;
(B)minimum hours of engagement;
(C)payment for work performed during meal breaks;
(D)penalty rates and loadings for casual employees;
(E)allowances; and
(F)long service leave
The above provisions are outlined in detail in the witness statement of Ms Slattery.
The Applicant submitted importantly, the Applicant is making offers of employment to the Transferring Employees on a commitment that their overall terms and conditions would be no less favourable than those which they currently enjoy with CPSM.
Accordingly, coverage by the Applicant’s Instruments, supported by the Applicant’s offers of employment, will not result in the Transferring Employees overall being disadvantaged (and in many instances, it will result in an improvement to Transferring Employees’ terms and conditions of employment, including their minimum rates of pay).
A small number of Transferring Employees performing administrative/clerical work, and who appear to be covered by the GCH Agreements, will not be covered by the Applicant’s Instruments if these applications were approved. However, the Applicant is making offers of employment to these employees on the above grounds, ie that they will be employed on terms and conditions that, overall, are no less favourable than their existing terms and conditions of employment with CPSM. This was corroborated in the witness statement of Ms Slattery.
Nominal expiry dates of the agreements
The various agreements impacted by these applications all have different nominal expiry dates, as set out above. The Regis Support Services Agreement passed its nominal expiry date on 31 December 2022, while the Regis Nurses Agreement is yet to pass its nominal expiry date (which is 30 June 2024). In the case of the GCH Agreements, those instruments passed their nominal expiry dates almost nine years ago.
Negative impact on productivity of the new employer’s workplace
The Applicant submitted that if the applications are not granted, the ongoing coverage of the GCH Agreements to the Transferring Employees will have negative impacts on the operations of the CPSM facilities, and potentially the wider business of the Applicant.
Whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer
The Applicant submitted the ongoing coverage of the GCH Agreements to the Transferring Employees would result in economic disadvantage to the Applicant due to the need to establish and maintain separate and additional administrative arrangements for the Transferring Employees (including separate payroll systems), and in some instances separate work practices, eg break times and work patterns.
The Applicant submitted over time, and subject to when the Applicant’s Instruments are renegotiated and replaced by new enterprise agreements (which presumably would also cover the Transferring Employees), the mounting cost of applying the GCH Agreements to the Transferring Employees could be substantial.
The degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer
The Applicant submitted there is limited business synergy between the respective industrial instruments, representing a further ground in support of the applications.
The GCH Agreements and the Applicant’s Instruments reflect the differing organizational structures and approach of the old and new employers. This is exampled by:
(a)CPSM’s common agreement for certain employees as opposed to the Applicant’s approach of separate state based enterprise agreements for nursing and support service work streams, and arrangements underpinned by the Aged Care Award for clerical employees;
(b)differing classification structures; and
(c)time off in lieu arrangements.
Again, the granting of the applications will otherwise ensure employees in the respective work streams in all of the Applicant’s Queensland operations are covered by the same industrial regulation and core conditions of employment. This will substantially promote efficiency and workforce unity and harmony within the Applicant’s business.
Public interest
The Applicant submitted residential aged care is a very important service to the community, the need for which is increasing. It is in the public interest that providers of this service be able to operate as efficiently as possible, and that productivity is not impeded or subject to potential disruption.
EMPLOYEE / UNION VIEWS
The QNMU emailed my chambers on 28 March 2024 noting they did not wish to be heard. Likewise, the AWU also emailed on this date with submissions that indicated they did not object to the transfer.
To date, no material has been received from any employees of the Applicant.
CONSIDERATION
I have considered the submissions and am satisfied that employees will not be disadvantaged overall if the orders sought are granted.
There are no public interest grounds that would prevent the granting of the application.
CONCLUSION
I am satisfied that the requirements of s.318 of the FW Act have been met. Orders will be issued with this Decision.
COMMISSIONER
Printed by authority of the Commonwealth Government Printer
<AE895675 & AE895680 PR773111>
0
0
0