Startek Employment Services Australia Pty Ltd
[2022] FWCA 3094
•15 SEPTEMBER 2022
| [2022] FWCA 3094 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument
Startek Employment Services Australia Pty Ltd
(AG2022/3391)
Advantage Employment Agreement 2007
| Clerical industry | |
| COMMISSIONER LEE | MELBOURNE, 15 SEPTEMBER 2022 |
Application for termination of the Advantage Employment Agreement 2007
This decision concerns an application made by Startek Employment Services Australia Pty Ltd (the Applicant) for the termination of the Advantage Employment Agreement 2007 (the Agreement) pursuant to Item 16 of Schedule 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act).
Item 16 of Schedule 3 to the Transitional Act provides:
“16 Collective agreement-based transitional instruments: termination by FWA
(1) Subdivision D of Division 7 of Part 2-4 of the FW Act (which deals with termination of enterprise agreements after their nominal expiry date) applies in relation to a collective agreement-based transitional instrument as if a reference to an enterprise agreement included a reference to a collective agreement-based transitional instrument.
(2) For the purpose of the application of Subdivision D to an old IR agreement, the agreement’s nominal expiry date is taken to be the end of the period of the agreement.”
Subdivision D of Division 7 of Part 2-4 of the Fair Work Act 2009 (the Act) states:
“225 Application for termination of an enterprise agreement after its nominal expiry date
If an enterprise agreement has passed its nominal expiry date, any of the following may apply to the FWC for the termination of the agreement:
(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.
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.
227 When termination comes into operation
If an enterprise agreement is terminated under section 226, the termination operates from the day specified in the decision to terminate the agreement.”
Consideration
Section 225
The Agreement is a collective agreement-based transitional instrument and has passed its nominal expiry date. The employer covered by the Agreement has made and is entitled to make the application to the Fair Work Commission for the termination of the Agreement.
Section 226
On the Form F24C declaration filed with the application, the Applicant states that it believes that termination of the Agreement is not contrary to the public interest because:
“The Advantage Employment Agreement 2007 was negotiated and approved prior to the introduction of the Contract Call Centre Award 2010.
Startek Australia considers the Contract Call Centre Award 2020 to provide more favourable terms of employment and that terminating the Agreement and transitioning to the Award to align terms and conditions of employment with those of the broader industry, would be in the best interest of Startek Employees.
We consider the termination of the Agreement would not result in any disadvantage to Startek employees or the broader community and therefore could not be considered contrary to public interest
The Australian Services Union (ASU) who is authorized to represent the industrial interests of Startek Australia employees is supportive of the termination of the Advantage Agreement, and of Startek Australia employees instead being covered by the Contract Call Centre Award.”
I am satisfied, in accordance with s.226(a) of the Act, that it is not contrary to the public interest to terminate the Agreement.
The Australian Municipal, Administrative, Clerical and Services Union (ASU) is an employee organisation covered by the Agreement. On 22 August 2022, my Chambers sent an email to the ASU seeking their views in relation to the application to terminate the Agreement. On the same day, the ASU responded in the following terms:
“In response to your queries regarding the ASU’s position regarding the termination of the referred Agreement we are most supportive of the application being made by Startek as the Agreement has some history to it.
· We have had issues with this Agreement for many years and believe it to be deficient in so many ways but as we were not a party to the Agreement we could not directly seek its termination despite raising our concerns with the previous owners. As you can see there has been a change of owners of the company which the Agreement originally covered.
· Early this year a number of members came to us where we explained the situation (as we had in the past) and they expressed a willingness to directly make an application themselves with our support. The application was based on the numerous deficiencies we audited some time ago (see attached).
· In February 2022 the ASU wrote to Startrek seeking that they initiate proceedings to terminate the Agreement otherwise we would initiate our own actions through our members (see correspondence attachment).
· Without going into detail numerous correspondence and meetings have occurred with Startek about the matter, and whilst appreciating Startek’s initiative to terminate the Agreement, we believe this has partly come about from our own efforts to see this done where the dispute is now around the timeframe to have this done since we first wrote to them back in February. From the ASU’s perspective we believe the application should have been initiated some time ago in order to have the Contract Call Centre Award operating by the end July as originally agreed between the parties.
· It has been our intention to seek leave to intervene on this matter so as to provide the Commission with, what we believe to be, some relevant background information if necessary. We understand that an application to terminate was made under the wrong provision and this has now been corrected. The ASU is aware that the staff have been made aware of the situation and has provided its own newsletters for circulation and is aware that Startek has provided its own as well.
· We are of the view that since its last communication Startek indicated that it would be able to have the Award operative from September having finalised the relevant payroll adjustments and we hope that this can be realised as soon as practically possible.”
On 22 August 2022, my Chambers also wrote to the Applicant directing them to take action to enable me to obtain information in relation to the views and circumstances of employees. Specifically, the Applicant was directed to provide to the employees covered by the Agreement a notice (the Notice) in the following terms:
“An application has been made by the Startek Employment Services Australia Pty Ltd to terminate the Advantage Employment Agreement 2007.
The matter has been allocated to Commissioner Lee of the Fair Work Commission for determination.
If the application to terminate the Advantage Employment Agreement 2007 is successful, your minimum employment entitlements will be regulated by the applicable modern award.
Commissioner Lee, when determining whether to terminate the agreement, is required to take into account the views of employees covered by the agreement.
If you have any views about the application to terminate the agreement, please advise the Commissioner by email at [email protected] or by calling (03) 8656 4534. Views are to be provided to the Fair Work Commission by no later than 4.00 PM on Monday, 27 August 2022.”
The Applicant was advised that once this course of action was followed, that it was to provide in a statutory declaration the details of the steps it took to make the Notice available to the employees. This was to be completed by 29 August 2022. On 29 August 2022, the Applicant provided a statutory declaration declared by Mr Sanjay Sanghvi (AVP – Human Resources) which confirmed that the Notice was provided to employees by way of email on Monday, 22 August 2022.
On 22 August 2022, my Chambers received the following email:
“Dear Commissioner Lee
I write in relation to the changes to the award in the subject of this email.
Under the current award, we do not have any paid breaks, annual leave loading and only receive the minimum hourly rate x 2 on public holidays for which we are required to work.
I would really appreciate these being reviewed and changed in line with the current award.
Thank you.
Davina”
My Chambers responded to this email on 30 August 2022 in the following terms:
“We note that the views expressed in the email below are in relation to “changes to the award”.
We note that the application relates to the termination of the Advantage Employment Agreement 2007.
It is the Commissioner’s understanding that the email does not express an objection to the termination of the Agreement.
Please provide any views by no later than close of business on Thursday, 1 September 2022.
In the absence of a response, the application will be determined based on the material before the Commission.”
No further views were received from any employees covered by the Agreement. I note that on the Form F24C declaration, the Applicant states as follows:
“On the 14th of April 2022 Startek communicated the intention to proactively terminate the Agreement to all staff, including the implication of the change being the transition of employment entitlements and conditions to the Contract Call Centre Award 2020 and note that to-date we have not received any feedback from employees to suggest that this or the transition of terms and conditions of employment to the Award would be in any way unwelcome.
Startek has been contacted by a small number of staff who have indicated their support of the termination of the Agreement.
The ASU has similarly advised that they have members who have reached out to them in support of the termination of the Agreement and transition to the Award.
The most significant differences between the Agreement and Award are:
1. the change to the span of ordinary hours from 6am-9pm to 7am-7pm Monday to Friday
2. The entitlement to penalty rates for Casual staff working outside the span of ordinary hours, on weekends and Public Holidays
3. Increase to the penalty rates applicable to work outside of ordinary hours from 15% to 25%
4. Increase to the penalty rates applicable to Saturday Night & Morning shift from 50% to 75%
5. Increase in the penalty rates applicable to permanent employees working day-shift on public holidays from 100% to 150%
6. Higher overtime rates for Casual employees under the Award”
The evidence in this matter weighs overwhelmingly in favour of the approval of the application to terminate the Agreement. I am therefore satisfied, in accordance with s.226(b) of the Act, that it is appropriate to terminate the Agreement having regard to all the circumstances, including the views of the employees, each employer, and each employee organisation covered by the Agreement and their circumstances, including the likely effect that the termination will have on each of them.
Having regard to the above, I am therefore required under s.226 of the Act to terminate the Agreement. The application to terminate the Agreement is therefore approved.
In accordance with s.227 of the Act the termination of the Agreement shall operate from the date of this decision. An order will be issued to this effect.
COMMISSIONER
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