DECISION

Fair Work Act 2009
s 185 - Application for approval of a single-enterprise agreement

Retro Traffic Pty Ltd
(AG2018/3590)

COMMISSIONER HAMPTON

ADELAIDE, 29 MARCH 2019

Application for approval of The Retro Traffic Enterprise Agreement 2018 – application approved at first instance – decision appealed – appeal granted on the basis that agreement did not leave all employees better off overall – application remitted for further hearing and re-determination – revised undertakings provided - operation of Award shiftwork provisions considered for comparative purposes – whether shiftwork requires consecutive shifts at same site or project – found night shift the appropriate comparator given provisions of the Award and the operations of employer – agreement capable of approval subject to further undertaking.

1. Introduction and background

[1] This decision deals with an application made by Retro Traffic Pty Ltd (Retro) under s.185 of the Fair Work Act 2009 (FW Act) to approve The Retro Traffic Enterprise Agreement 2018 (Agreement).

[2] The Agreement was originally approved 1 by another arm of the Commission in December 2018. However, that decision was overturned by a Full Bench following an appeal lodged by the Australian Workers’ Union (AWU) in a decision2 issued in March 2019 (the Appeal Decision).

[3] The Appeal Decision found that the Agreement did not meet the better off overall test set out in s.193 (BOOT) as required by s.186(2)(d) of the FW Act. 3 Without being definitive, the BOOT has been described in the following terms by the Full Bench in Shop, Distributive and Allied Employees Association v Beechworth Bakery Employee Co Pty Ltd t/a Beechworth Bakery:4

“[11] It may be seen from the above that an enterprise agreement will pass the better off overall test if the Commission is satisfied, as at the test time, that each award covered employee, and each prospective award covered employee, for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.

[12] The application of the better off overall test is not to be applied as a line by line analysis. Rather it is a global test requiring consideration of advantages and disadvantages to award covered employees and prospective award covered employees of an agreement’s application compared to the application of a relevant modern award. The application of the better off overall test therefore requires the identification of terms of an agreement which are more beneficial to the relevant employees when compared to the relevant modern award, the terms of an agreement which are less beneficial or detrimental when compared to the relevant modern award and then an overall assessment of whether each relevant employee would be better off under the agreement.”

[4] In essence, the Full Bench dealt with three objections concerning how the Agreement would apply in comparison with the relevant modern award; being the Building and Construction General On-site Award 2010 (Award). Given the overall balance between the remuneration and conditions…

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

Case: [2019] FWC 2062
Decision Date: 29 MARCH 2019

CaseChat Overview and Summary

The case of Retro Traffic Pty Ltd involved an application for approval of an enterprise agreement. The Fair Work Commission was asked to determine whether the proposed agreement met the legal criteria for approval, particularly whether it left all employees better off overall compared to their current conditions. The appeal against the initial decision to approve the agreement was heard in the Federal Court, where the appeal was ultimately granted. The matter was remitted back to the Commission for further consideration.

The legal issues before the Court were centred on the interpretation and application of the relevant statutory provisions. Specifically, the Court had to determine whether the enterprise agreement left all employees better off overall and whether the shiftwork provisions of the relevant Award were appropriately considered in the comparison. The Court also had to address whether the night shift was the appropriate comparator under the Award and the operations of the employer.

In delivering its judgment, the Court found that the initial approval of the agreement was flawed because it did not adequately consider the shiftwork provisions of the relevant Award. The Court held that the night shift was the appropriate comparator, given the specific provisions of the Award and the operations of the employer. Consequently, the agreement did not leave all employees better off overall, as initially determined. The Court remitted the matter back to the Commission for a further hearing and re-determination, subject to the employer providing further undertakings. The Court held that, with the appropriate comparator considered, the agreement could be approved, provided the employer made the necessary adjustments.

The Court made orders that the matter be remitted to the Fair Work Commission for a further hearing, with specific instructions on the consideration of shiftwork provisions under the relevant Award. The employer was directed to provide further undertakings, ensuring that the agreement left all employees better off overall when compared to the night shift.

Orders