RSL Care RDNS Limited T/A Bolton Clarke
[2024] FWC 1247
•14 MAY 2024
| [2024] FWC 1247 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
RSL Care RDNS Limited T/A Bolton Clarke
(AG2024/1055)
| COMMISSIONER CONNOLLY | MELBOURNE, 14 MAY 2024 |
Application for an order relating to instruments covering new employer and transferring employees
On 3 April 2024, RSL Care RDNS Limited T/A Bolton Clarke (the Applicant) made an application under section 318 of the Fair Work Act 2009 (Cth) (Act) in relation to the following enterprise agreement:
·McKenzie Aged Care Group Enterprise Agreement 2016 [2016] FWCA 8907 (McKenzie Aged Care EA).
The Applicant seeks orders that:
1. In accordance with section 318(1)(a) of the Fair Work Act 2009 (Cth), the McKenzie Aged Care Group Enterprise Agreement 2016 ([2016] FWCA 8907) will not cover the Applicant, or any employee employed by the Applicant based in New South Wales.
2. That, in accordance with section 318(1)(b) of the Fair Work Act 2009 (Cth), the Allity Enterprise Agreement (New South Wales) 2018 ([2019] FWCA 4510) will cover the Applicant and any employee employed by the Applicant based in New South Wales who was previously covered by the McKenzie Aged Care Group Enterprise Agreement 2016 ([2016] FWCA 8907) immediately prior to 20 May 2024.
3. The order will apply on and from 20 May 2024.
On 8 April 2024, I issued directions to the Applicant as follows:
(1) The Applicant is to take all reasonable steps to make available to employees covered by the Agreement, employees to be impacted by the orders sought and any employee organisations covered by the Agreement a copy of these Directions and the Application, by close of business Friday 12 April 2024;
(2) The Applicant is to file and serve a short witness statement illustrating compliance with direction (1), by close of business Friday 19 April 2024;
(3) If any party, including any employee or employee organisation, opposes the application, advice should be given to my chambers, in writing by close of business Wednesday, 24 April 2024. Such advice should be sent to [email protected]; and
(4) If no objection is received by chambers by the time identified in paragraph (3), this matter will be determined on the material filed.
The Relevant Legislation
Section 311 of the Act relevantly provides:
“311 When does a transfer of business occur
Meanings of transfer of business, old employer, new employer and transferring work
(1) There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:
(a) the employment of an employee of the old employer has terminated;
(b) within 3 months after the termination, the employee becomes employed by the new employer;
(c) the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;
(d) there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).
Meaning of transferring employee
(2) An employee in relation to whom the requirements in paragraphs (1)(a), (b) and (c) are satisfied is a transferring employee in relation to the transfer of business.
Transfer of assets from old employer to new employer
(3) There is a connection between the old employer and the new employer if, in accordance with an arrangement between:
(a) the old employer or an associated entity of the old employer; and
(b) the new employer or an associated entity of the new employer;
the new employer, or the associated entity of the new employer, owns or has the beneficial use of some or all of the assets (whether tangible or intangible):
(c) that the old employer, or the associated entity of the old employer, owned or had the beneficial use of; and
(d) that relate to, or are used in connection with, the transferring work.”
Sections 317 and 318 of the Act relevantly provide:
“317 FWC may make orders in relation to a transfer of business
This Division provides for the FWC to make certain orders if there is, or is likely to be, a transfer of business from an old employer to a new employer.
…
“318 Orders relating to instruments covering new employer and 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 transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;
(b) an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.
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 transferring employee, or an employee who is likely to be a transferring employee;
(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 transferring employee before the later of the following:
(a) the time when the transferring employee becomes employed by the new employer;
(b) the day on which the order is made.
Transfer of Business
I am satisfied that there has been a transfer of business from the MacKenzie Aged Care Group Pty Ltd ACN 006 276 124 (MACG Pty Ltd) to the Applicant and that Bolton Clarke is a “new employer” pursuant to s.311(1) of the Act, having regard to the material before me by virtue of:
· The acquisition of MACG Pty Ltd by the Applicant by virtue of an acquisition agreement under a confidential deed executed 23 December 2022, and completed on 23 February 2023.
· All employees in the operation of MACG affected by this Application being employed by MACG Pty Ltd at this time.
· By the 13 of March 2023, all former MACG employees were transferred from MACG Pty Ltd to the Applicant.
· The acquisition involving a transfer of business, including a transfer of employment with the relevant connection required by s.311(1)(d) that has been established by reference to;
a.The transfer of some assets used by employees when employed by MACG Pty Ltd, and separately;
b.The corporate relationship between the Applicant and MACG Pty Ltd as associated entities at the time the employment transferred.
As I am satisfied that Bolton Clarke is a “new employer” as defined pursuant to s.311(1) of the Act, it may apply to the Commission under s.318 of the Act for orders relating to a transferable instrument.
Transferable Instrument
On consideration of the Applicant’s submissions and the evidence before the Commission, I am satisfied that at the time of the transfer of business it recognised the following transferring instrument, which applied to transferring employees at the time;
· McKenzie Aged Care Group Enterprise Agreement 2016 [2016] FWCA 8907.
As this is an enterprise agreement that has been approved by the Commission, the Agreement is a transferable instrument pursuant to s.312(1)(a) of the Act.
Section 313 of the Act provides that the Agreement covers Bolton Clarke and the transferring employees, subject to any order of the Commission under s.318(1) of the Act as sought by this application.
At the time of application, the Applicant submits it has its own enterprise agreement covering work of the type covered by the transferable instrument. This is the Allity Enterprise Agreement (New South Wales) 2018 ([2019] FWCA 4510 (Allity NSW EA).
Who May Apply for An Order?
The application has been made by Bolton Clarke, the new employer. This meets the requirements of s.318(2) of the Act.
Bolton Clarke seeks an Order that the transferrable instrument, being the McKenzie Aged Care EA, not cover the Applicant and former employees of MACG Pty Ltd.
Matters That the FWC Must Take into Account – Section 318
Section 318(3)(a) the views of the new employer or a person who is likely to be the new employer and the employees who would be affected by the order
Bolton Clarke, the new employer, has made the application under s.318 of the Act and supports the making of the Order sought. It also submits that employees who would be affected by the Order are supportive of the making of the Order sought.
The Applicant’s filed materials includes a witness statement from Ms Olivia Kofoed, Group General Manager Employees Relations and Policy for the Applicant. Ms Kofoed attests that in compliance with my Directions on 11 April 2024, the Applicant sent all employees a copy of the Directions and the Applicant’s application.
These Directions provided an opportunity to any employee, or employee organisation, who opposes this application to advise my Chambers by close of business on Wednesday, 24 April 2024. As of this time, no employee has contacted my Chambers indicating their opposition to the making of the Order sought.
The Applicant’s submission included further material indicating it has conducted a survey of employees seeking their confidential views on the making of the order. They submit, 100% of employees surveyed indicate they support the making of the Order.
Having regard to these matters, I have formed the view that this factor weighs in favour of granting the Order.
Section 318(3)(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment
Bolton Clarke submits that no employee would be disadvantaged by the Order sought and that on an overall basis, employment arrangements for employees will be more favourable given the increased rates and entitlements under the Allity NSW EA. Furthermore, they submit that they have committed to ensure any relevant historical entitlements will be “grandfathered” or “top up” for the life of the Allity NSW EA to ensure employees are no worse off.
On 19 April 2024, I received submissions from Ciaran Byrne of the Health Services Union NSW/ACT/QLD and on 23 April 2024, I received submissions from Sherene Daniel of the Australian Nursing and Midwifery Federation NSW who, pursuant to these directions, had been provided with a copy of the application on 11 April 2024. Both the HSU’s and ANMF’s submissions do not oppose the application and are in favour of the making of the Order.
Having considered all the material before me, I am satisfied that no employee would be disadvantaged in relation to their terms and condition of employment by the Order and that therefore, this factor weighs in favour of granting the Order sought.
Section 318(3)(c) if the order relates to an enterprise agreement—the nominal expiry date of the agreement
The nominal expiry date of the McKenzie Aged Care EA is 30 June 2019, and the Agreement is well past its nominal expiry date. This does not weigh against the granting of the Order sought.
Section 318(3)(d) whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace
Bolton Clarke submits that the making of the Order will not negatively impact on the productivity in the workplace. Rather, its submissions are that the making of the Order will have a positive impact on the productivity of its workplace with regard to payroll administration, rostering, alignment of terms and conditions and business synergies.
I am persuaded that these submissions have merit and have formed the view that this factor weighs in favour of granting the Order.
Section 318(3)(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer
Bolton Clarke submit that should the Order not be made the Applicant shall continue to bear the administrative cost of multiple industrial arrangements and that this economic disadvantage is a relevant consideration. I consider this to weigh in favour of granting the Order sought.
Section 318(3)(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer
Bolton Clake submits that administering multiple and inconsistent industrial arrangements as is presently the case has a negative impact on its overall business synergy.
I consider this factor weighs in favour of granting the Order sought.
Section 318(3)(g) the public interest
Bolton Clarke submit that the making of the Order will not offend the public interest. Further, they submit it is in the public interest and the interest of its workforce and overall productivity to have aligned and harmonious industrial arrangements in place under a single agreement for employees doing the same type of work.
Given the circumstances and having regard to the material before me, I am not of the view that there are any public interest reasons not to make the Order sought.
Conclusion
Having considered each of the matters set out in s.318(3) of the Act, I am satisfied that the Order sought should be made, taking effect on and from 20 May 2024.
An Order to this effect will be issued along with this decision.[1]
COMMISSIONER
Final written submissions:
23 April 2024.
[1] PR774947.
Printed by authority of the Commonwealth Government Printer
<PR774946>
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