Scitech Discovery Centre
[2022] FWCA 562
•21 FEBRUARY 2022
| [2022] FWCA 562 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.225—Enterprise agreement
Scitech Discovery Centre
(AG2022/291)
Scitech Casual Employees Enterprise Agreement 2011
| Amusement, events and recreation industry | |
| DEPUTY PRESIDENT BEAUMONT | PERTH, 21 FEBRUARY 2022 |
Application for termination of the Scitech Casual Employees Enterprise Agreement 2011
This decision concerns an application by Scitech Discovery Centre (the Applicant) for the termination of the Scitech Casual Employees Enterprise Agreement 2011 (the Agreement),[1] under s 225 of the Fair Work Act 2009 (the Act).
Section 225 of the Act allows an employer to apply to the Commission for the termination of an agreement that has passed its nominal expiry date.
Section 226 of the Act, set out below, details the considerations for the Commission when dealing with such an application.
226 When the FWC must terminate an enterprise agreement
If an application for the termination of an enterprise agreement is made under section 225, the FWC must terminate the agreement if:
(a) the FWC is satisfied that it is not contrary to the public interest to do so; and
(b) the FWC considers that it is appropriate to terminate the agreement taking into account all the circumstances including:
(i) the views of the employees, each employer, and each employee organisation (if any), covered by the agreement; and
(ii) the circumstances of those employees, employers and organisations including the likely effect that the termination will have on each of them.
The Applicant held no objection to the application being determined on the papers and I consider that it is appropriate to do so.
In support of its application, the Applicant provided a statutory declaration from Sam Kronja its interim Chief Executive Officer (CEO) and undertakings (see Annexure A).
The Applicant provided context about the application to terminate the Agreement in the CEO’s statutory declaration. That context is as follows.
Background to the application
The Agreement was negotiated with casual employees in 2010 and has been in operation since 7 March 2011. It covers all the Applicant’s casual employees who would otherwise be covered by the Amusement Events and Recreation Award 2020 (Award).[2]
The Applicant employs 140 employees in roles on either a full-time, part-time, or casual basis. Employees performing roles on a full-time and part-time basis are employed under common law contracts underpinned by the Award. In contrast, the casual employees are engaged under the Agreement. The Agreement has not been varied since approval and its nominal term expired on 30 June 2013. Those casual employees covered by the Agreement are not in the process of bargaining for a replacement to the Agreement and the Applicant has not received any indication from employees covered that they would like to bargain for a replacement agreement
Currently, the Agreement covers 32 casual employees, which represents 24% of the Applicant’s total workforce. These casual employees are engaged in the following positions: a) Discovery Centre, Casual Science Presenter (28 staff); b) Outreach, Casual Science Presenter (2 staff); and c) Discovery Centre, Casual Customer Service (2 staff).
Should the Agreement be terminated, consistent with the employment practices in-place for full-time and part-time staff (including those employed in Science Presenter and Customer Service positions), the casual employees would be employed by the Applicant on common law contracts underpinned by the Award.
The Applicant explained that the Agreement creates operational and administrative inefficiencies for it. The significant amount of time that has passed since its nominal expiry date meant, said the Applicant, that the Agreement no longer meets its operational needs.
The Applicant detailed that some of its employees perform the same work albeit they are employed on a permanent or casual basis. In such circumstances, these employees were afforded different terms and conditions of employment dependent on their type of employment. According to the Applicant, this situation presented an administrative burden with additional time (and therefore labour costs) required to ensure compliance with two streams of employment terms and conditions. By way of example, the Applicant referred to casual employees and permanent employees having access to different dispute resolution and disciplinary procedures.
While the Agreement is expressed to cover all of the Applicant’s casual employees (clause 1.2(b)), Appendix B contained job descriptions for only three roles. The job descriptions were developed in 2010 for Science Presenters for the Applicant’s Outreach Planetarium and Science Programs. The job descriptions are not referred to in the body of the Agreement.
The Applicant states that Appendix B in the Agreement causes confusion for the causal employees because the job descriptions are no longer current. Plus, the Applicant also employs causal employees in other positions that are not contained in Appendix B. Simply put, said the Applicant, the Agreement no longer reflects the Applicant’s operational reality.
The Applicant observed that the Agreement only provides for one base rate of pay (clause 4.2(a)), with additional rates only provided for casual employees engaged on touring duties (clause 4.2(c)) or supervisory duties (clause 4.2(d)). The Applicant explained that this structure meant it was not able to easily delineate casual employees on a pay or classification structure that reflects the nature (or seniority) of their position. This proved inconsistent with the classification structure that it implemented for full-time and permanent employees working in similar roles.
At the time the Agreement was made in 2010, the Applicant was said to have employed casuals in the positions contemplated by Appendix B of the Agreement. The rates of pay in the Agreement were designed having regard to the duties of those positions at the time, which ranged from lower-level duties such as front of house procedures, but also various higher end duties, including science and exhibition presentations.
The Applicant submitted that it had since identified that it was no longer financially or operationally feasible to structure the duties undertaken by its casual employees in this way. According to the Applicant, this was because it was not able to engage employees to perform only lower grade duties, without having to pay them a base rate of pay designed for positions that also perform higher grade duties.
The Applicant pressed that its operations now required casual positions engaged to perform not only higher-level duties, but also to perform only lower-level duties. In the Applicant’s view, the Agreement acted as a barrier for it to implement this structure, as it was unable to pay casual employees a rate of pay that correctly reflected the nature of the duties they performed.
Should the Agreement be terminated, the Applicant confirmed it would adopt the classification structure provided under the Award for casual employees. This outcome would permit it to implement the employment structure it has identified as required to meet its operational requirements. The new structure would thereafter permit the Applicant to properly delineate positions based on the seniority of the duties undertaken by its causal employees.
The Applicant noted that adopting the classification structure under the Award would not lead to a loss of pay for any current casual employees covered by the Agreement. The undertaking provided by the Applicant reflects this (see Annexure A). The Applicant detailed that this was because the ability to employ new employees to perform only lower-level duties meant that those lower-level duties could be removed from the positions of current casual employees, allowing those same employees to occupy positions with higher grade duties.
The Applicant confirmed that all casual employees currently employed in customer service positions would be promoted to senior customer service positions and would retain their current pay. The customer service positions would be delineated into ‘entry level’ and ‘senior’ positions. All existing customer service employees will be considered ‘senior’ employees, therefore attracting a higher rate of pay and higher duties. The Applicant had determined the customer service position would fall within the grade 3 classification under the Award.
Regarding science presenters, the position of casual science presenter would be re-classified from a grade 3 classification to a grade 7 classification under the Award. This again was to be facilitated by providing this position with additional responsibilities and opportunities in assisting the Applicant’s design team with programs and exhibits.
It was acknowledged that the entry level customer service position would be paid less than the current customer service positions (which would of course become senior customer service positions). However, the rate of pay for the entry level customer service position would be higher than the Award by 5%.
The Applicant garnered the views of its casual employees by conducting an anonymous survey to see whether the termination of the Agreement was supported. Prior to conducting the survey, information sessions were held regarding the proposed termination of the Agreement. Following those information sessions, the Applicant held a seven-day consultation period with the casual employees from 19 November 2021 to 30 November 2021. During this period, casual employees were encouraged to provide feedback on the proposed termination of the Agreement. The vote/survey was conducted on 1 December 2021 and a majority of casual employees voted in support of the termination of the Agreement.
Consideration
I am satisfied the requirements of s 225 of the Act are met. The Agreement has passed its nominal expiry date, and pursuant to s 225(a), the CEO declared the Applicant is the employer covered by the Agreement. As such, the Applicant has standing to bring the application under s 225(a) of the Act.
Section 226(a) of the Act – Not contrary to the public interest
Attention first turns to whether the termination of the Agreement is ‘not contrary to the public interest’.
The ‘public interest’ refers to matters that might affect the public as a whole, such as the achievement or otherwise of the object of the Act, employment levels, inflation, and the maintenance of proper industrial standards.[3] It is distinct in nature from the interests of the parties, though those interests may be simultaneously affected.[4]
The object of the Act set out in s 3 is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians. The object is to be achieved, among other things, by ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions, and by achieving productivity and fairness through an emphasis on enterprise-level collective bargaining. Section 578 requires that in performing functions or exercising powers, the Commission must take this object into account.
It is also relevant to highlight that the Full Bench in Aurizon Operations Limited; Aurizon Network Pty Ltd; Australian Eastern Railroad Pty Ltd (Aurizon) concluded that it cannot be expected that the terms and conditions of an agreement will continue unaltered in perpetuity after it has passed its expiry date.[5] This is because the Act contemplates the terms and conditions of an agreement may be altered by making a new agreement or by terminating the existing agreement.
If the Agreement was terminated and the Applicant engaged new employees, those future employees would be covered by the Award, as will the existing ones. On this basis, the termination of the Agreement would not adversely affect the public interest in so far as the maintenance of proper industrial standards was concerned.
The Applicant contended that the foreseeable consequences of the termination are: (a) it being better positioned to employ employees who perform the same duties under the same industrial instrument irrespective of employment type; (b) a decrease in the administrative burden arising from dealing with two different industrial instruments; and (c) the introduction of a classification system that meets the operational requirements of the Applicant.
Based on the material contained in the declaration of the Applicant filed with the application and additional materials filed, I am satisfied that the termination of the Agreement is not contrary to the public interest.
Section 226(b) of the Act – Appropriateness
The approach to assessing ‘appropriateness’ in the context of ss 226(b)(i) and (ii) of the Act was detailed by the Full Bench in Aurizon. It said:
[A]ll of the circumstances also need to be taken into account in considering whether termination of the agreements is appropriate. In particular the views of employers and employees covered by the agreement, their circumstances, and the impact of termination need to be taken into account. The requirement in s. 226(b) to take into account all of the circumstances including those set out in s. 226(b)(i) and (ii) is a requirement to take the matters into account and to give them due weight in assessing whether it is appropriate to terminate an enterprise agreement. In assessing appropriateness by taking into account all of the circumstances, we approached the task by reference to the construction of s. 226 and the contextual matters that bear upon that construction dealt with earlier as well as giving specific consideration to the matters identified in s. 226(b)(i) and (ii).[6]
I intend to adopt this approach.
The Applicant has undertaken a comprehensive consultative process with its employees regarding the proposed termination and the effect that it would have on them. Those same employees have demonstrated support for the termination, albeit some opted not to vote. During the consultative process, the Applicant has provided the employees with the undertakings which have now been reduced to writing in Annexure A.
Taking into account all of the circumstances including those in ss 226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement.
Conclusion
An Order[7] will be issued terminating the Agreement with effect on 21 February 2022.
DEPUTY PRESIDENT
Determined on the papers
Annexure A
[1] [2011] FWAA 1304; AE884399;PR507160.
[2] MA000080.
[3] Re Aurizon Operations Limited[2015] FWCFB 540, [129] (‘Aurizon’).
[4] Re Kellogg Brown and Root Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000 (2005) 139 IR 34, [23].
[5] Aurizon (n 3) [176].
[6] Ibid [167].
[7] PR738516.
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