RPEP Holdings Pty Ltd
[2010] FWA 1981
•10 MARCH 2010
Note: An appeal pursuant to s.604 (C2010/3333) was lodged against this decision - refer to Full Bench decision dated 21 July 2010 [[2010] FWAFB 4672] for result of appeal.
[2010] FWA 1981 |
|
DECISION |
Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement
(AG2009/24641)
COMMISSIONER LARKIN | SYDNEY, 10 MARCH 2010 |
Application for approval of the RPEP Holdings Pty Ltd ACN 120 840 397 (Cleaning) Enterprise Bargaining Agreement 2009 – no disadvantage test – application refused.
[1] RPEP Holdings Pty Ltd (the employer) lodged with Fair Work Australia an application pursuant to s.185 of the Fair Work Act 2009 (the Act) for approval of a single enterprise agreement. The agreement is titled the RPEP Holdings Pty Ltd ACN 120 840 397 (Cleaning) Enterprise Bargaining Agreement.
[2] The agreement was made during the bridging period 1 as defined in the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act), accordingly, when considering whether to approve the agreement I have taken into account the provisions of Part 2-4 of Chapter 2 of the Act as modified by Schedule 7 of the Transitional Act.
[3] The industry of the employer was stated to be Facility Management and the kind of work performed by employees under the agreement was stated to be commercial contract cleaning. The agreement is to operate in all States and Territories of Australia and is said to cover 121 employees of which 44 voted and 42 approved the agreement. The statistical information provided with the application stated that of the employees to be covered by the agreement 56 were female, 50 were from a non-English speaking background, 1 was an Aboriginal and Torres Strait Islander person, 114 were part-time and 29 over the age of 45 years. The reference instruments for the purpose of the no-disadvantage test were cleaning and building services awards and NAPSAs in operation in each State and Territory. 2
[4] On 15 January 2010 correspondence was forwarded to the employer seeking clarification in relation to the working of shift work under the agreement. On 21 January 2010 the employer advised that employees did work Saturday and Sunday shifts and were 7 day shift workers. In the correspondence it was said that “Shift staff are employed part time during the following shifts, and for a minimum of 3 hours; afternoon shift, early morning shift and night shift”. The employer advised that the afternoon shift commenced after 6.00pm and finished before 1.00am, the early morning shift commenced at 3.00am and finished by 6.00am and the night shift commenced after 1.00am and finished before 8.00am.
[5] The application was heard on 2 February 2010. Mr Pucci, Managing Director, appeared on behalf of the employer with Ms Fowler his Personal Assistant.
[6] During proceedings I put to Mr Pucci that on the material before me I was not satisfied that the agreement would pass the no-disadvantage test. Those concerns related to quantum of annual leave for shift workers, rates of pay, overtime payment, payment for work on a public holiday, shift penalty and weekend penalty payments. These issues and others associated with the employer’s business operation were discussed during the proceedings and Mr Pucci was afforded an opportunity to put further material in support of the application. The employer’s further material was filed on 22 February 2010.
[7] Fair Work Australia must be satisfied that the agreement passes the no-disadvantage test, as required by ss.186(2)(d) of the Act. The Explanatory Memorandum to the Fair Work (Transitional Provisions and Consequential Amendments) Bill, states:
“Item 4 – When does an agreement pass the no-disadvantage test?
326. This item provides that an enterprise agreement made during the bridging period must pass the no-disadvantage test. An enterprise agreement passes the no-disadvantage test if FWA is satisfied, that an enterprise agreement would not result, on balance, in a reduction in the employees’ overall terms and conditions of employment under any reference instrument relating to one or more employees. A reference instrument is defined in subitem 5(1). This is the same test that applied to the approval of workplace agreements under Division 5A of Part 8 of the WR Act.”
[8] In considering the material before me and having regard to the submissions and supporting material lodged on behalf of the employer, I am not satisfied that the agreement passes the no-disadvantage test. Following are my reasons.
[9] The agreement at clause 5.0 refers to the Cleaning and Building Services Contractors (State) Award (the New South Wales NAPSA) as the reference instrument for the purpose of the no-disadvantage test. The agreement at clauses 5.0 and 7.0 provide that the agreement is to be read and interpreted wholly in conjunction with the terms of the NAPSA and where there is any inconsistency the agreement will take precedence.
[10] The agreement at subclause 13.2 sets out the following wages rates. I note subclause 13.3 provides for yearly increases in the rates of pay of 2.5% over the period of the agreement’s operation.
13.2 Wages
Cleaning Services
Classification | Basic Hourly Rate | Basic Hourly Rate | Basic Hourly Rate |
Cleaning Services | Full-Time 38 hr weekly Roster | Part-Time Rate @ 15% of basic hourly rate, inclusive of loading (less than 38 hrs weekly) | Casual rate Rate @ 25% of basic hourly rate Irregular Roster |
Level 1 | $15.60 | $17.95 | $19.50 |
Level 2 | $15.89 | $18.27 | $19.87 |
Level 3 | $16.78 | $19.29 | $20.97 |
[11] The above wage rates are an all inclusive payment for shift penalties, Saturday and Sunday work and allowances, excluding public holidays.
[12] The Pay Scale Summary developed by the Workplace Authority for the Cleaning and Building Services Contractors (State) Award (AN120123) for cleaners follows:
Classification | Basic Hourly Rate Full-time | Basic Hourly Rate Part-time | Basic Hourly Rate Casual | |
Cleaners | Night Shift Worker A* | $19.49 | $21.11 | |
Night Shift Worker B | $19.24 | $17.95 | $19.45 | |
Broken/ Afternoon/ Early Morning Shift Worker | $17.39 | $17.95 | $19.45 | |
Day Shift Worker A | $15.59 | $17.95 | $19.45 | |
Day Shift Worker B# | $15.59 | $18.49 | $20.03 | |
*The Rate of Pay for Night Shift Worker A shall apply to those part-time/casual employees who as at 12 July 1996 were engaged on night shift.
#The Rate of Pay for Day Shift Worker B shall apply to those employees who are engaged pursuant to a contract awarded by the NSW Government State Contract Board.
[13] A level 1 full-time cleaner under the agreement is paid an all up rate of $15.60 per hour. Under the New South Wales NAPSA a cleaner is paid, depending upon the particular shift worked, a minimum of $15.59 per hour to a maximum of $19.24 per hour.
[14] A level 1 part-time cleaner under the agreement is paid an all up rate of $17.95 per hour. Under the New South Wales NAPSA a cleaner is paid, depending upon the particular shift worked and date of engagement, a minimum of $17.95 per hour to a maximum of $19.49 per hour.
[15] A level 1 casual cleaner under the agreement is paid an all up rate of $19.50 per hour. Under the New South Wales NAPSA a cleaner is paid, depending upon the particular shift worked and date of engagement, a minimum of $19.45 per hour to a maximum of $21.11 per hour.
[16] As previously stated, the agreement rates of pay are an all up rate, excluding public holidays. The reference instruments provide for a weekend penalty payment for ordinary hours worked on a Saturday at time and a half and for ordinary hours worked on a Sunday, double time. The New South Wales NAPSA, at Table 6B, Saturday and Sunday Ordinary Time Hourly Rates – Cleaning Services Stream, sets out the applicable hourly rate of pay to commence on or after 1 July 2006 for full-time, part-time and casual employees working particular shifts. A cleaner working on a weekend shift under the agreement would be paid an hourly rate less than the rate that would apply under the New South Wales NAPSA for work performed on those shifts.
[17] Work performed on a Public Holiday is not included in the all up rate but paid at the rate of double time under the agreement. The reference instrument provides that work performed on a public holiday will be paid for at the rate of double time and one half. The employer submissions filed on 22 February 2010 stated that employees should be paid double time and a half pursuant to the New South Wales NAPSA.
[18] I raised with Mr Pucci during proceedings on 2 February 2010 issues associated with the definition of shift worker and the quantum of annual leave for a 7 day shift worker. On the basis of the material filed by the employer on 22 February 2010 it appears that some part-time employees work a 7 day roster, which includes afternoon and night shifts. The employer’s submission on this point stated “please refer to Annual Leave provisions of the NAPSA as stipulated in the following clauses of the EBA”. Those agreement clauses were stated to be clause 7.0 and subclauses 5.1 and 5.2.
[19] The agreement’s overtime provision (clause 23.0) for full time employees for work done in excess of 38 hours per week referred to the Act for method of calculation and payment. Part time employees for work exceeding 38 hours would be paid at the rate of time and a half for any overtime worked. The employer’s submissions of 22 February 2010, while not specifically stating so, sought to alter the provision to time and a half for the first 2 hours and double time thereafter for hours worked in excess of ordinary time hours.
[20] As stated in the Explanatory Memorandum, an enterprise agreement passes the test if that agreement would not result, on balance, in a reduction in the employees’ overall terms and conditions of employment under any reference instrument. The rates of pay in the agreement are but one factor in an employee’s overall terms and conditions of employment. As outlined above, the agreement’s all up rate of pay is less than the rates a level 1 cleaner would attract under the New South Wales NAPSA.
[21] When the terms and conditions of the agreement are considered as a whole and compared to the relevant reference instruments I am not satisfied that, on balance, the agreement passes the no-disadvantage test. I decline to approve the enterprise agreement subject to this application.
COMMISSIONER
Appearances:
Mr R Pucci, for the applicant.
Hearing details:
Sydney.
2010:
February, 2.
Final written submissions:
2010:
February, 22.
1 Item 2, Part 1 of Schedule 2.
2 AN140083; AN120123; AP773639; AP822844; AN160088; AN170119 and AN150028.
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