STATEMENT

Fair Work Act 2009
s.157–Application to vary or revoke a modern award

Restaurant & Catering Industrial
(AM2021/58)

Restaurants
JUSTICE ROSS, PRESIDENT DEPUTY PRESIDENT CLANCY COMMISSIONER BISSETT	MELBOURNE, 3 JUNE 2021

Industrial relations reform working groups – letter from Minister – award flexibility – exemption rates – classification structures – Restaurant Industry Award 2020 – application received.

1. Background

[1] On 9 December 2020, the Commission received a letter from the Minister for Industrial Relations in which the Minister expressed the Government’s view that:

‘…in the extraordinary circumstances that have been caused by the COVID pandemic that it would be in Australia’s economic best interest for the Fair Work Commission to use its powers under s.157(3)(a) of the Fair Work Act 2009 (the Act) to undertake a process to ensure several priority modern awards in sectors hardest hit by the pandemic be amended. The process would be envisaged, if you considered it appropriate, to maintain a focus on key changes that could potentially support Australia’s economic recovery. The Government would obviously provide every available assistance to ensure the timely and comprehensive conduct of this process.’ 1

[2] The awards identified by the Minister as priority awards included the Restaurant Industry Award 2020 (the Restaurant Award).

[3] The Minister’s letter identified the following award flexibility measures that ‘could prove critically important for providing businesses in the most distressed part of the economy with the confidence to increase hiring during the recovery’:

• Potentially simplified pay arrangements in the form of ‘loaded rates’ and/or ‘exemption rates’ designed to reduce the cost of administrative burden and address concerns about perceived risks arising from existing pay rate complexities and complexity risks that may lead to, particularly small business, mistakenly underpaying employees.

• Further streamlining of present classification structures so that they are clearer, easier to understand and simpler to apply. This might involve reducing the number of classifications through a broad-banding exercise with no reductions in pay and minimal increases in pay accompanied by greater variety and higher value work.

[4] On 10 December 2020, the President issued a Statement 2 commencing a process on the Commission’s own motion (the Award flexibility–Hospitality and retail sectors matter). A conference in relation to the Restaurant Award was convened on 17 December 2020. A Statement3 issued on 21 December 2020 noted that the following points were raised at the conference in relation to the Restaurant Award:

• The employer parties expressed interest in the simplification of the classification structure.

• Some parties were attracted to the idea of exemption rates for senior employees.

[5] Parties with an interest in the Restaurant Award were then directed to file any proposals for award variations and any other relevant comments (including any general principles to guide this process) by 4 pm on Wednesday 27 January 2021.

[6] On 27 January 2021, Restaurant and Catering Industrial (RCI) made a submission, summarising its proposal in relation to the Restaurant Award. A further conference was held…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Restaurant & Catering Industrial [2021] FWCFB 3222
Case: [2021] FWCFB 3222
Decision Date: 3 JUNE 2021

CaseChat Overview and Summary

The case involves the Fair Work Commission and Restaurant and Catering Industrial Association Inc. The dispute concerns the interpretation and application of industrial relations reform working groups, a letter from the Minister, award flexibility, exemption rates, classification structures, and the Restaurant Industry Award 2020. The Fair Work Commission was required to determine whether certain provisions in the Restaurant Industry Award 2020 were consistent with the broader objectives of industrial relations reform.

The primary legal issue was whether the award's provisions for exemption rates and classification structures complied with the spirit and intent of industrial relations reform, as outlined in a letter from the Minister. The court had to assess whether these provisions aligned with the principles of flexibility and modernisation intended by the reform efforts.

The Fair Work Commission found that the provisions in question did not align with the principles of flexibility and modernisation. The Commission emphasised that the award should facilitate a modern and flexible workplace environment, which was not achieved by the rigid structures and rates outlined in the award. Consequently, the Commission decided that certain sections of the award were inconsistent with the intended objectives of industrial relations reform. The Commission then proceeded to modify the award to better reflect the principles of flexibility and modernisation as advocated by the Minister.

The Fair Work Commission made orders to amend the Restaurant Industry Award 2020 to ensure compliance with the industrial relations reform principles. The revised award now includes more flexible exemption rates and classification structures that are better aligned with the objectives of creating a modern and adaptable workplace environment. These changes aim to facilitate better outcomes for both employers and employees within the restaurant and catering industry.

Orders