Schindler Lifts Australia Pty Ltd

[2019] FWCA 4237

[2019] FWCA 4237

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.217—Enterprise agreement

Schindler Lifts Australia Pty Ltd
(AG2019/1740)

SCHINDLER LIFTS AUSTRALIA PTY LTD – VICTORIAN ENTERPRISE AGREEMENT 2018-2021

Building, metal and civil construction industries

COMMISSIONER BISSETT

MELBOURNE, 18 JUNE 2019

Application for variation of the Schindler Lifts Australia Pty Ltd - Victorian Enterprise Agreement 2018-2021.

[1] Schindler Lifts Australia Pty Ltd (Applicant) has made an application to the Fair Work Commission (Commission) to vary the Schindler Lift Australia Pty Ltd – Victorian Enterprise Agreement 2018-2021 1 (Agreement) to remove ambiguity or uncertainty. In particular the Applicant seeks to vary:

(i) Dispute resolution procedures – clauses 10(a)(ii);

(ii) CPI increases – clauses 49.6, 52.4, 52.5(a)(i) and (ii) and Part 15 clause 1.6(c);

(iii) New Projects Victorian site allowance – clause 52.5(b); and

(iv) Requirements for work to continue on sites effected by heat – clause 56.8.6.

[2] The application is made pursuant to s.217 of the Fair Work Act 2009 (FW Act). Section 217 of the FW Act provides as follows:

217 Variation of an enterprise agreement to remove an ambiguity or uncertainty

(1) The FWC may vary an enterprise agreement to remove an ambiguity or uncertainty on application by any of the following:

(a) one or more of the employers covered by the agreement;

(b). an employee covered by the agreement;

(c). an employee organisation covered by the agreement.

(2) If the FWC varies the enterprise agreement, the variation operates from the day specified in the decision to vary the agreement.

[3] The Agreement was approved Commission on 26 February 2019 and commenced operation on 5 March 2019. It was approved with undertakings, none of which touch on the clauses said to be ambiguous or uncertain.

[4] The application to vary the Agreement to remove ambiguity or uncertainty was made on 24 May 2019. The application was made by the employer covered by the Agreement. As is relevant to my ultimate consideration both the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU), as bargaining representatives for the Agreement and covered by the Agreement, have both indicated support for the variations.

[5] The application was subject to a Mention by telephone on 5 June 2019. The Applicant sought, and the CEPU agreed (the AMWU having indicated earlier agreement in writing) that the application be dealt with on the basis of the written application. Given the precision of the written application and that there was no opposition to the application I decided that I would determine the matter on the basis of the written application.

[6] As s.217 of the FW Act makes clear the Commission’s power to vary the Agreement is only enlivened if ambiguity or uncertainty exists within the Agreement. It is therefore necessary, in the first instance, to determine if the Commission does have jurisdiction to do what is sought in the application.

Are the clauses ambiguous or uncertain?

(i) Dispute resolution procedures – clauses 10(a)(ii) and (vii)
[7] The ambiguity is said to arise through the interaction of clauses 10(a)(ii) and 10(a)(vii) sought to be varied are:

10 DISPUTE RESOLUTION PROCEDURES

(a) The following procedure shall apply:

…

(ii) Where any such attempt at resolution has failed at step (i), within one working day the employee shall notify the employee representative and the supervisor shall brief the State Manager. These Parties shall document and attempt to resolve the dispute within the next two working days.

…

(vii) At all stages of the above dispute resolution procedure, the employee is entitled to have a representative of their choice.

[8] The Applicant submits that clause 10(a)(ii), when read in conjunction with clause 10(a)(vii) is ambiguous as it implies that an “employee representative” will be involved in dispute resolution in all cases. Clause 10(a)(vii) however states that an employee may be represented if they chose, leaving it open for them to choose not to be represented.

[9] The Applicant submits that the ambiguity can be resolved by amending clause 10(a)(ii) to read:

10 DISPUTE RESOLUTION PROCEDURES

(a) The following procedure shall apply:

…

(ii) Where any such attempt at resolution has failed at step (i), within one working day the employee shall notify their employee representative if they choose one and the supervisor shall brief the State Manager. These Parties shall document and attempt to resolve the dispute within the next two working days…

[10] I am satisfied that the clause, as read, is ambiguous. I am further satisfied that the variation as proposed resolves the ambiguity.

(ii) CPI increases – clauses 49.6, 52.4, 52.5(a)(i) and (ii) and Part 15 clause 1.6(c)

[11] The relevant parts of the clauses in relation to how the rates therein that are said to be uncertain read as follows:

a. Clause 49.6 Housing Commission Flats Allowance:

…This figure will be subject to CPI (all groups Melbourne) as from September 2019.

b. Clause 52.4 Demolition Allowance:

…From the date of approval $7.05 per hour increasing by the CPI (‘all groups Melbourne’) from the September 2019 quarter statistics…

c. Clause 52.5(a)(i) Site Allowance - City of Melbourne, New Projects:

•  increasing by the CPI (‘all groups Melbourne’) from the September 2019 quarter statistics…

d. Clause 52.5(a)(ii) Site Allowance - City of Melbourne, Renovations, Restoration &/or Refurbishment work:

•  increasing by the CPI (‘all groups Melbourne’) from the September 2019 quarter statistics…

e. Part 15 clause 1.6(c) Metal Engineering Construction Site Project Allowance:

(c) The Project disability Allowances in this clause are to be adjusted annually on 1 October in line with CPI movements to the nearest 5 cents.

[12] The Applicant submits that the clauses are uncertain for one of the following reasons:

a. It is not clear when the increase to the allowance is to take effect, or how frequently (clauses 49.6, 52.4, 52.5(a)(i) and (ii));

b. It is not clear which CPI figure is to be used as the reference point for the increase to the relevant allowance, either:

i. Temporally — It is not clear whether the relevant CPI figure is to be fixed as at a single point in time for all future increases (in particular, as at the September 2019 quarter) (clauses 49.6, 52.4, 52.5(a)(i) and (ii)), or whether it is to be updated at the time the increase to the allowance is to take effect (for example, “annually”: Part 15 clause 1.6(c)); or

ii. Geographically — that is, it is not clear whether the relevant CPI figure is that for Melbourne, the weighted average of the eight capital cities, or some other figure (Part 15 clause 1.6(c)); and

c. It is not clear how the CPI figure, which is expressed as a percentage, is to translate as an increase in monetary terms, rounded or otherwise (clauses 49.6, 52.4, 52.5(a)(i) and (ii)).

[13] The Applicant proposes that the clauses be amended by replacing those parts set out above with the following:

a. Clause 49.6 Housing Commission Flats Allowance:

…his allowance will be adjusted annually (effective from 1 September 2019) in accordance with CPI movements (All Groups, Melbourne) for the preceding 12 month period from July to June. Increases to be rounded to the nearest 5 cents – either up or down.

b. Clause 52.4 Demolition Allowance:

…From the date of approval $7.05 per hour. This allowance will be adjusted annually (effective from 1 September 2019) in accordance with CPI movements (All Groups, Melbourne) for the preceding 12 month period from July to June. Increases to be rounded to the nearest 5 cents – either up or down…

c. Clause 52.5(a)(i) Site Allowance - City of Melbourne, New Projects:

•  This allowance will be adjusted annually (effective from 1 September 2019) in accordance with CPI movements (All Groups, Melbourne) for the preceding 12 month period from July to June. Increases to be rounded to the nearest 5 cents – either up or down…

d. Clause 52.5(a)(ii) Site Allowance - City of Melbourne, Renovations, Restoration &/or Refurbishment work:

•  This allowance will be adjusted annually (effective from 1 September 2019) in accordance with CPI movements (All Groups, Melbourne) for the preceding 12 month period from July to June. Increases to be rounded to the nearest 5 cents – either up or down…

e. Part 15 clause 1.6(c) Metal Engineering Construction Site Project Allowance:

(c) The Project disability Allowances in this clause will be adjusted annually (effective from 1 September 2019) in accordance with CPI movements (All Groups, Melbourne) for the preceding 12 month period from July to June. Increases to be rounded to the nearest 5 cents – either up or down…

[14] I am satisfied that the clauses are uncertain in that there is lack of certainty in relation to the actual CPI figure and then in its application and timing in adjusting the allowances therein. I am further satisfied that the proposed variations resolve that uncertainty.

(iii) New projects Victorian site allowance – clause 52.5(b)

[15] Clause 52.5(b) of the Agreement provides for site allowances on new projects in Victoria as follows:

(b) New Projects Victoria

Project Value ($M)	Hourly rate $ ph
Up to - $7.6	2.68
$7.6 - $18.6	2.81
$18.6 - $37.4	3.16
$37.4 - $74.7	3.73
$74.7 - $149.3	4.47
$149.3 - $224.0	4.59
$224.0 - $298.5	4.76
$298.5 - $447.9	4.93

[16] The Applicant submits that the clause does not provide an allowance for projects with a value of over $447.9 million suggesting that it is uncertain if any allowance is payable for such projects. This, the Applicant says, is contrary to the underlying principle in the clause that the site allowance rate increases incrementally with the value of the project.

[17] The Applicant also submits that this uncertainty can be rectified by the inclusion of the following words immediately after the table:

For project values above $447.9 million there shall be an increment in site allowance of 10 cents per $100 million or part thereof…

[18] I am satisfied that the uncertainty in that it does not provide a site allowance for projects in excess of $4476.9 million may suggest that no allowance is payable for such a project. I am further satisfied that the proposed variation resolves this uncertainty.

(iv) Requirements for work to continue on sites affected by heat – clause 56.8.6

[19] Clause 56.8 of the Agreement provides for arrangements for working in heat. Clause 56.8.6 of the Agreement specifically provides:

56.8.6 On days forecast to be 35 degrees Celsius plus, work can start at 6.00am by agreement between the Parties, notification is to take place not less than 1 hour prior to the normal finish time on the preceding day

[20] The Agreement defines the “Parties” to the Agreement in clause 4 as:

•  Schindler Lifts Australia Pty Ltd;

•  All employees in Victoria and Tasmania; and

•  The AMWU and CEPU.

[21] A literal reading of clause 56.8.6 would require that work could only start at 6.00am by agreement between the Applicant and all employees and both unions. This, the Applicant submits would create an absurd and unworkable outcome. The Applicant says that such an outcome is contrary to the clear underlying principle of the clause which is to allow work to continue on days where the temperature exceeds 35 degrees Celsius.

[22] If “Parties” as defined in clause 4 is not the intended pool that must agree to the 6.00am start it is uncertain as to who should be required to reach agreement for such a start to occur.

[23] The Applicant therefore proposes that the clause be varied as follows:

56.8.6 On days forecast to be 35 degrees Celsius plus, work can start at 6.00am by agreement between the Parties employer and affected employees, notification is to take place not less than 1 hour prior to the normal finish time on the preceding day.

[24] I am satisfied that there is uncertainty in the operation of the clause because of the definition of “Parties” contained in clause 4 of the Agreement and that clause 56.8.6 should be amended to overcome this uncertainty as proposed by the Applicant.

Clauses as amended

[25] A complete copy of the clauses as amended is at annexure A to this decision. A copy of the Agreement as varied by this decision is attached.

Conclusion

[26] For the reasons given above I am satisfied that the Agreement is attended by ambiguity and uncertainty.

[27] I am satisfied that the clauses, as varied, will resolve this ambiguity and uncertainty.

[28] In reaching my decision I have taken into account that there is agreement between the Applicant and the AMWU and CEPU party to and covered by the Agreement as to the issues and the resolution of those issues.

[29] The Agreement will be varied as sought with a date of effect on 18 June 2019.

COMMISSIONER

<AE501998  PR709482>

Annexure A

 1   AE501998.

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