Respect Group Limited T/A Respect Aged Care

[2020] FWC 6598

[2020] FWC 6598

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.319 - Application for an order relating to instruments covering new employer and non-transferring employees

Respect Group Limited T/A Respect Aged Care
(AG2020/3484)

COMMISSIONER JOHNS SYDNEY, 23 DECEMBER 2020

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

[1] On 17 November 2020, Respect Group Limited T/A Respect Aged Care (the Applicant) made an application pursuant to s.319 of the Fair Work Act 2009 (Cth) (the Act) for an Order that the Lockhart & District Aged Care Association Inc., NSWNMA and HSU NSW Enterprise Agreement 2017-2020 1 (the Agreement) covers non-transferring employees who perform or are likely to perform the transferring work covered by the Agreement.

[2] In the Form F40 – Application for Orders in relation to a transfer of business, the Applicant sets out the Orders sought as follows:

“That the Lockhart & District Aged Care Association Inc NSWNMA and HSU NSW Enterprise Agreement 2017-2020 (Lockhart EA) will cover those employees (Non-Transferring Employees) who:

a) from 18 November 2020 will be employed by Respect; and

b) who will perform the same, or substantially the same work for Respect as Transferring Employees covered by the Lockhart EA.”

[3] In support of the application, a statutory declaration of Mr Nicholas Adams, People and Culture Manager of the Applicant, was filed. On 27 November 2020, my Chambers wrote to Mr Adams with draft directions, which, if formally issued, would require the applicant to serve the Application on any affected employee or employee organisations and provided a deadline for any party opposed to the making of the order sought to file materials with the Commission.

[4] A response to the draft directions was received from Mr Adams on 1 December 2020. It stated that there are currently no non-transferring employees at the facility, that consultation with the Health Services Union of Australia (HSU) and the New South Wales Nurses and Midwives' Association (NSWNMA) had occurred and the organisations had been served with a copy of the Application.

Relevant legislation

[5] Section 319 of the Act states:

“319 Orders relating to instruments covering new employer and non-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 non-transferring employee because of subsection 314(1) does not, or will not, cover the non-transferring employee;

(b) an order that a transferable instrument that covers, or is likely to cover, the new employer, because of a provision of this Part, covers, or will cover, a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer;

(c) an order that an enterprise agreement or a modern award that covers the new employer does not, or will not, cover a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer.

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 non-transferring employee who performs, or is likely to perform, the transferring work for the new employer;

(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 non-transferring employee before the later of the following:

(a) the time when the non-transferring employee starts to perform the transferring work for the new employer;

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

Consideration:

[6] I consider each of the factors the Commission must take into account below in turn.

Section 319(3)(a)(i) – the views of the new employer

[7] As the employer is the Applicant in the matter, it is clear that the employer supports the application.

Section 319(3)(a)(ii) – the views of the employees who would be affected by the order

[8] In the application form and in his statutory declaration, Mr Adams has stated that whilst there are currently no non-transferring employees, he engaged with the HSU and NSWNMA on 5 November 2020. The evidence of Mr Adams is that the employee organisations were supportive of the application.

[9] Mr Adams further stated that he is not aware of any party who opposes the Order sought.

[10] This weighs in favour of the Order being granted.

Section 319(3)(b) – whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment

[11] The evidence of Mr Adams was that he was not aware of any terms or conditions in the Agreement that would be overall less beneficial than the corresponding terms or conditions in the Aged Care Award 2010 or the Nurses Award 2010 (the relevant Awards).

[12] This weighs in favour of the Order being granted.

Section 319(3)(c) – if the order relates to an enterprise agreement—the nominal expiry date of the agreement

[13] The Agreement reached its nominal expiry date on 30 June 2020.

[14] Mr Adams stated that, because the nominal expiry date has passed, the transferring employees and non-transferring employees are able to request the commencement of enterprise agreement bargaining.

[15] I consider this a neutral factor.

Section 319(3)(d) – whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace

[16] The evidence of the employer, as set out in the application form and the statutory declaration of Mr Adams was that, in the event the order sought was not granted, the employer would be required to apply the Relevant Awards. Mr Adams stated that this would require the employer to maintain separate rosters and payroll systems for the Transferring and Non-Transferring Employees, requiring additional work by HR and payroll staff, which would result in additional expense.

[17] This weighs in favour of the Order being granted.

Section 319(3)(e) – whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer

[18] As set out above, the employer has stated that the making of the Order result in less administrative burden which will increase productivity and reduce expenses.

[19] This weighs in favour of the Order being granted.

Section 319(3)(f) – the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer

[20] Mr Adams stated that the relevant Awards contain, amongst other things, differences in wage rates, shift penalties, allowances, hours of work and roster arrangements, and leave arrangements.

[21] I accept that the relevant Awards contain different conditions and wage rates, that this means there is not a high degree of synergy and that this weighs in favour of the Order being granted.

Section 319(3)(g) – the public interest

[22] In the application form, Mr Adams has stated that the Application is consistent with the objectives listed in section 309 of the Act in that the interests of the Non-Transferring Employees are safeguarded, there is no overall disadvantage in the terms and conditions of employment of the Non-Transferring Employees and the unions who are likely to represent the Non-Transferring Employees support the Application.

[23] I accept this statement and find that this weighs in favour of the Order being granted.

Conclusion:

[24] Having considered all the matters required by the Act, I am satisfied that the requirements have been met and an order in the terms sought by the Applicant should be made.

[25] An Order [PR725243] to this effect has been issued concurrently with this decision

COMMISSIONER

Matter dealt with on the papers

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