Seven Network (Operations) Limited

[2020] FWCA 2387

[2020] FWCA 2387

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.210—Enterprise agreement

Seven Network (Operations) Limited
(AG2020/1142)

SEVEN NETWORK (OPERATIONS) LIMITED (NEWS, PUBLIC AFFAIRS AND OPERATIONS) AGREEMENT 2019

Broadcasting and recorded entertainment industry
COMMISSIONER LEE	MELBOURNE, 6 MAY 2020

Application for variation of the Seven Network (Operations) Limited (News, Public Affairs and Operations) Agreement 2019.

[1] An application has been made for approval of a variation to the Seven Network (operations) Limited (News, Public Affairs and Operations) Agreement 2019 (the Agreement). The application was made by Seven Network (Operations) Limited pursuant to section 210 of the Fair Work Act 2009 (the Act).

[2] The application seeks to vary various clauses of the Agreement. The effect of the variations is to remove the entitlement to a 2% wage increase that is payable from the first full pay period after 4 April 2020. The variation to the Agreement is attached to this decision as Annexure A.

[3] The Applicant has provided a written undertaking. A copy of the undertaking is attached in Annexure B. I have sought the views of the bargaining representatives on the undertaking. I am satisfied that the undertaking will not cause financial detriment to any employee covered by the Agreement and that the undertaking will not result in substantial changes to the Agreement. The undertaking is taken to be a term of the Agreement.

[4] Subject to the undertaking referred to above, and on the basis of the material contained in the application and accompanying statutory declaration, I am satisfied that each of the requirements of ss.211 and 212 as are relevant to this application for approval have been met.

[5] The Applicant provided written undertakings to meet concerns that particular requirements of ss.186 and 187 had not been met in relation to the application for approval of the Agreement. The undertakings were accepted and the Agreement was approved on 28 March 2019. Those undertakings form part of the Agreement as varied.

[6] The application was not accompanied by a properly witnessed statutory declaration. Pursuant to s.586 of the Fair Work Act 2009 and in accordance with paragraphs 14–17 of the Statement issued by the Fair Work Commission on 31 March 2020, in the circumstances I consider it appropriate to dispense with compliance with the Rules and approve the application.

[7] The Applicant has requested that the application have an operative date of the variation from 1 April 2020. That will mean the variation, if granted from that date, will have retrospective effect.

[8] The Applicant made submissions as to why the request for the 1 April 2020 operative date was made. The Agreement, absent the variation, provides for a pay rise for employees covered by it of 2% to take effect from the first full pay period on or after 4 April 2020. The actual date of effect of the obligation applying that provision is 7 April 2020 as this is when the full first full pay period after 4 April 2020 commences.

[9] On 6 April 2020 the relevant employees were made aware of the proposed variation by email. That email included the following wording:

“Seven is proposing to amend the NPAO Agreement so that there will be no increase to employees’ pay in 2020.”

“Seven proposes that the variations to the NPAO Agreement take effect from 1 April 2020.” 1

[10] Therefore, the Applicant submits that:

“The purpose of the variation proposed to employees (and approved by them) was therefore clear - to avoid the need to increase rates of pay at all in 2020, in circumstances where such increases would otherwise be required to be implemented from the first full pay period commencing on or after 4 April 2020.” 2

[11] The Applicant submits that the broader context in which the variation was proposed is the significant impact of the COVID-19 pandemic which is having a significant impact on businesses. Further that the earlier operative date would also avoid the administrative burden of administering rates of pay for a short period and then remove them again.

[12] The Applicant submits that the approval of retrospective operation is consistent with a previous decision of the Commission in Catalina Country Club Enterprise Agreement 2009 3 (Catalina Country Club).

[13] The CPSU, the Community and Public Sector Union, supported by the Media, Entertainment and Arts Alliance, do not oppose approval of the variation but do oppose the approval having an operative date of 1 April 2020.

[14] In summary, the grounds for opposition are:

● The authority of Catalina Country Club, is distinguishable from the present application as it was an application made under s 223,
● In any case in Catalina Country Club, Deputy President Sams expressed the view “In most circumstances, orders, decisions and determinations of the Commission operate from the date of publication of the Commission’s decision” 4 and “Ordinarily, I would be hesitant to make orders of retrospective application in a matter such as this, particularly where the rights of, or obligations on parties may be materially affected”5.
● That in, Catalina Country Clubthe variation was made retrospective to the date of the application.
● It is accepted that the COVID-19 crisis is an exceptional circumstance, but that employees shouldn’t lose a pay increase to which they were entitled before they had the opportunity to consider or vote on the proposed variation. The pre-emptive date sought will retrospectively remove an entitlement.

[15] The administrative burden said to flow from the operative date not being 1 April 2020 was a matter the Applicant could have avoided by the Applicant initiating the process at an earlier date.

[16] Supplementary submissions were made at the Hearing held yesterday.

[17] At the conclusion of the Hearing, I determined to approve the application; and that pursuant to s216 the variation will come into operation from 6 April 2020.

[18] I note that the Applicant has sought the variation will operate from 1 April 2020. I agree with the sentiment expressed in Catalina Country Club that in most circumstances, orders and decisions of this Commission operate from the date of decision. However, in certain circumstances the Commission may be satisfied, as a matter of discretion, that it is appropriate that the operation of a decision, in this case to vary an agreement, operate prospectively or retrospectively. Any decision in this regard should take into account all the circumstances of the case. The circumstances of this application favour allowing the variation to operate retrospectively. However, the Applicant seeks the variation operate from a time prior to employees even being made aware of the application. I do, as a matter of principle, have concerns about allowing an operative date that is prior to the time that the proposal was put to employees for consideration, that time being 6 April 2020. However, I acknowledge that from the submissions of the company that employees were clearly told on that date what the intent of the proposed variation would be, to the effect that there would be no increase payable during 2020. It is apparent this variation gives effect to that proposal.

[19] I acknowledge and as said above, I agree with the submissions of the unions that generally the approach of the Fair Work Commission is to approve variation decisions or termination of agreement decisions from the date the Commission Member determines the matter. However, I am satisfied that there are exceptional circumstances in this case. The advent of the COVID-19 pandemic and the significant impact that this is having on a range of industries including this industry is certainly an exceptional circumstance. The other particular circumstance to take into account is that there was a clear indication that the intent of the application to vary the Agreement was that there would be no obligation to pay the increase to which employees were entitled in 2020. I agree with the union submissions that it was open to the company to pursue the application to vary at an earlier time. Nevertheless, employees were made aware of the proposal for change in clear terms, prior to the entitlement to the increase.

[20] It is for these reasons I determined at the Hearing yesterday that the variation will operate from 6 April 2020,

[21] The variation is approved and the consolidated version of the Agreement, as varied, is attached to this decision.

[22] In accordance with s.216 of the Act, the date specified in this decision from which the variation will operate is 6 April 2020.

COMMISSIONER

 1   Applicant’s email to employees dated 6 April 2020 ( Applicant’s submissions dated 29 April 2020 at [15] and [16])

 2   Applicant’s submissions dated 29 April 2020 at [17]

 3   [2013] FWCA 2005

 4   [201]3 FWCA 2005 at [124]

 5   [201]3 FWCA 2005 at [125]

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