Steggles Poultry Processing Pty Limited

[2013] FWCA 8498

[2013] FWCA 8498

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement

Steggles Poultry Processing Pty Limited
(AG2013/2549)

STEGGLES POULTRY PROCESSING PTY LIMITED BERESFIELD SHOP EMPLOYEES ENTERPRISE AGREEMENT 2013 - 2017

Retail industry
COMMISSIONER BULL	SYDNEY, 29 OCTOBER 2013

Application for approval of the Steggles Poultry Processing Pty Limited Beresfield Shop Employees Enterprise Agreement 2013 - 2017.

[1] An application has been made for approval of an enterprise agreement known as the Steggles Poultry Processing Pty Limited Beresfield Shop Employees Enterprise Agreement 2013 - 2017 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single-enterprise agreement.

[2] On 8 October 2013, the Commission wrote to the Applicant via its representative, and the Shop, Distributive and Allied Employees Association (SDAEA), being a bargaining representative for the Agreement to advise that it had a number of concerns with aspects of the Agreement and the Form F18 - Declaration of employee organisation in relation to an application for approval of an enterprise agreement that was filed by the SDAEA with respect to the application.

[3] Correspondence was received from the Applicant and the SDAEA on 10 and 16 October 2013 respectively.

Form F18

[4] A Form F18 was completed by Ms Barabra Nebart, a Union Official with the SDAEA and filed with this application. The Commission notes that a point 6 of the Form the SDAEA has indicated that it disagrees with one or more of the answers given to questions in the statutory declaration filed by the Employer, Steggles Poultry Processing Pty Limited with respect to the application.

[5] In particular, the SDAEA lists the following as areas of the employer’s declaration it disagrees with:

Paragraph 3.5 / Attachment C - Additional terms and conditions in the proposed Agreement that are more beneficial than the reference instrument(s) or are not conferred by the reference instrument(s) -

Clause 11 Counselling / Disciplinary Procedure - the Agreement contains a Counselling / Disciplinary Procedure which is not a term of the General Retail Industry Award 2010.

Clause 15.2 Supervisor Allowance (clarification of Item 8 of Attachment C) - Whilst the Award does not contain an equivalent relief Supervisor Allowance, it does contain a comparable classification - Retail Employee Level 4 (ref. Schedule B.4.2 “Supervision of up to 4 sales staff (including self)”). The current base rate of pay for this classification is $724.50 per week or $19.07 per hour. The rate of pay under the Agreement performing this work from 12/8/2013 shall by $20.50 + $2.13 = $22.63. The Agreement rate shall by 18.7% better than the equivalent hourly Award rate for the same work.

Clause 15.4 Mixed Functions and Identifying Classification Level - the Agreement provides for the payment at a higher grade for the whole week when a person is relieving in a higher grade for more than 60% hours in a week. The Agreement also provides for the payment at a higher grade for the day week when a person is relieving in a higher grade for more than 2 hours in a day (but less than 60% hours in a week). The Award does not contain an equivalent entitlement.

Clause 16.6 Call Out Allowance - the Agreement provides for a minimum of 3 hours at double time plus travel allowance when required to attend a “Call Out”. Under the Award the employee would be entitled to a minimum 3 hours at the relevant overtime rate if reasonably required to attend in accordance with the Overtime requirements (Clauses 29.1 and 29.2).

Clause 18.2.1 Ordinary Hours - the spread of ordinary hours in the Agreement is more beneficial than the spread of hours in the Award (Clause 27.2). Under the Agreement the spread of hours on a Monday to Friday adjusts by one hour (i.e. it is one hour earlier in the morning and one hour earlier in the evening) and the spread of hours on a Saturday is one hour shorter (i.e. finishes at 5pm rather than 6pm under the Award).

Paragraph 4.1 - The Union believes there is 1 part-time employee covered by the Agreement but may have misunderstood. The Company should be able to clarify this matter.

[6] The Commission asked for the Applicant to provide its response to these concerns raised by the SDAEA.

[7] The Applicant submitted that in relation to the additional items identified by the SDAEA, it does not disagree that the items may be more beneficial than the General Retail Industry Award 2010 (the Award), however, these items may not always be seen as more beneficial and/or it may be difficult to identify/quantify the benefit.

[8] Further, the Applicant in its correspondence to the Commission stated:

Clause 11 Counselling/ Disciplinary Procedure – Its inclusion is more likely to be seen as an advantage rather than a disadvantage.

Clause 15.2 and 15.4 – relate to higher duties arrangements not present in the award and given that the Level 4 classification was not adopted in the Agreement the comparison of rates was not made, however had the classification been used then the allowance is clearly more beneficial and 15.4 provides clarity around its application.

Clause 16.6 Call Out Allowance – The inclusion of a call out provision in the Agreement when the award has none may or may not be seen as more beneficial. Across awards call out rates are not always comparable with overtime rates, however they are clearly better in this case.

Clause 18.2.1 Ordinary hours – the shift in the spread of hours may not necessarily be considered more beneficial, however it would appear that the earlier start and finish times is preferred by the employees and considered more beneficial by the SDA.

Paragraph 4.1 – The union questioned the composition of the workforce believing there was a part time employee. The Union was advised on 26/08/2013 that the employee in question was in fact a full time employee.

[9] The SDAEA was provided with an opportunity to respond to the submissions made by the Applicant with respect to these matters. On 16 October 2013, the SDAEA confirmed it had reviewed the email correspondence of the Applicant and that it supported the further submissions made on behalf of the Applicant.

[10] Given the support of the SDAEA in relation to the Applicant’s correspondence with respect to its concerns it had initially identified in its Form F18, I am satisfied that the SDAEA does not intend to pursue these concerns and is satisfied with the response provided by the Applicant.

Ordinary hours

[11] The Commission notes that the Agreement provides for a span of ordinary hours of work that is outside the span of ordinary hours provided for under the General Retail Industry Award 2010 (the Award), being the relevant modern award for the purpose of the better off overall test.

[12] The Applicant has advised that the rates of pay in the Agreement are higher, and compensate for the span of ordinary hours being outside those provided for under the Award. Further, the SDAEA has provided an indicative roster and calculations to demonstrate that employees would be better off overall with respect to the span of ordinary hours in the Agreement.

Meal allowance

[13] The Commission notes that at clause 15 - Wages, and in particular, sub clause 15.2, the Agreement provides for a meal allowance from 12 August 2013 of $14.35.

[14] The Award at clause 20.1(a) provides a meal allowance of $16.67 where an employee is required to work more than one hour of overtime after the employee’s ordinary time of ending work without being given 24 hours notice. Where such overtime exceeds four hours a further meal allowance of $15.09 will be paid.

[15] The Applicant submits that under the Award the meal allowance is only paid if the employee does not receive 24 hours notice, whereas, under the Agreement the allowance is paid in all cases after one and a half hours overtime is worked and therefore the employee is better off for all rostered overtime.

[16] The Applicant provided to the Commission a comparison table with respect to the meal allowance and submits that the higher rates of pay in the Agreement compensates employees for the lower meal allowance.

[17] Further, the Applicant has submitted that employees may be disadvantaged with respect to the meal allowance in that the allowance in the Agreement ‘does not kick in’ until more than one and a half hours of overtime, whereas, the meal allowance in the Award ‘kicks in’ after more than one hour of overtime.

[18] The Applicant has provided an undertaking that an employee who works more than one hour of overtime after his/her normal finishing time will be paid a meal allowance as per clause 15.2 of the Agreement.

[19] This undertaking is taken to be a term of the Agreement. A copy of the undertaking is attached at Annexure A.

[20] I have sought the views of the bargaining representative, the SDAEA, in respect of the undertaking, pursuant to s.190(4) of the Act. The bargaining representative has not advised of any concerns with the undertaking provided.

Individual Flexibility Term

[21] The Act requires at s.202(1) that an enterprise agreement must include a flexibility term.

[22] The mandated flexibility term is described in the Act as being a term that:

202(1)(a) enables an employee and his or her employer to agree to an arrangement (an individual flexibility arrangement) varying the effect of the agreement in relation to the employee and the employer, in order to meet the genuine needs of the employee and employer; and

(b) complies with section 203.

[23] The Applicant and the SDAEA were asked for further information concerning the application of clause 35 - Individual Flexibility.

[24] Sub clause 35.1 of the Agreement is in the following terms:

The Company and an employee covered by this Agreement may agree to make an individual flexibility arrangement (“IFA”) about the following terms of the Agreement:

Clause title Clause number

Employee initiated request for flexible

working arrangements 18.4

[25] In correspondence from the Applicant’s representative on 10 October 2013, the Commission was advised of the following:

The form of the individual flexibility clause was a negotiated matter agreed between the parties. Both the Applicant and the SDA have indicated a preference not to import the model flexibility clause into the Agreement.

Furthermore, this term has been used in all agreements across the Baiada group of companies and their worksite and was negotiated in goodfaith with the SDA, AMWU, AWU, AMIEU and NUW.

The individual flexibility term at clause 35 may provide additional flexibility where a request under clause 18.4 of the Agreement may otherwise be refused on reasonable business grounds, by allowing the parties to modify the operation of the terms of the agreement to accommodate the request.

[26] On 16 October 2013, the SDAEA provided correspondence to the Commission with respect to the individual flexibility arrangement in the Agreement.

[27] The following was submitted by the SDAEA:

The Union supports the submission regarding the Individual Flexibility Term. The form of the clause provided is consistent with other clauses approved by the Fair Work Commission under the current legislative framework, ref. Clause 45.1.1 of the Clifford Hallam Healthcare Beresfield Enterprise Agreement 2012 (AE401276) approved by Commissioner Riordan on 15 May 2013. The Union supports the Applicant in opposing any proposal to import the model flexibility provision into the proposed Agreement.

[28] The SDAEA objects to any proposal to import the model flexibility term under the Act on the basis that the flexibility term contained in this Agreement is consistent with other clauses approved by other members of the Commission. In particular, the SDAEA refers to the approval of the Clifford Hallam Healthcare Beresfield Enterprise Agreement 2012 1, approved by Commissioner Riordan on 15 May 2013 and submits that the flexibility term under the Clifford Hallam Healthcare Beresfield Enterprise Agreement 2012 is consistent with the flexibility term contained in this Agreement.

[29] I note that at clause 45 of the Clifford Hallam Healthcare Beresfield Enterprise Agreement 2012, and in particular, sub clause 45.1.1, the flexibility term states:

45.1.1 the Agreement deal with the following matter:

(i) the short Friday may be arranged in a way to suit the parties by mutual agreement between the Company and an employee(s) under Clause 20.1;

[30] Clause 20.1 of the Clifford Hallam Healthcare Beresfield Enterprise Agreement 2012 deals with the provision to allow employees to finish 2 hours early on Fridays.

[31] The flexibility term contained in the Agreement seeks to vary sub clause 18.4 - employee initiated request for flexible working arrangements. Sub clause 18.4 of the Agreement is in the following terms:

18.4.1 An employee who:

● Is a parent or has responsibility for the care of a child; or
● Is receiving treatment for illness or injury;

May request the Company for a change in working arrangements, such as change in hours if work or pattern of work, to assist the employee to care for the child or attend treatment. Any flexible working arrangement must be dealt with in accordance with the flexibility clause in this Agreement.

18.4.2 The request must:

● Only be initiated by the employee;
● Be in writing; and
● Set out details of the change sought and the reasons for the change.

18.4.3 The Company must give the employee a written response to the request within 21 days stating whether the Company grants or refuses the request. The Company may refuse the request only on reasonable business grounds and these grounds must be detailed in the written response.

[32] The Applicant’s representative submits that the flexibility term may provide additional flexibility where a request under clause 18.4 of the Agreement may otherwise be refused on reasonable business grounds, by allowing the parties to modify the operation of the terms of the Agreement to accommodate the request.

[33] Pursuant to s.202(1)(a) of the Act a flexibility term is described as being a term that enables an employee and his or her employer to agree to an arrangement varying the effect of the agreement in relation to the employee and the employer, in order to meet the genuine needs of the employee and the employer.

[34] I do not accept that the flexibility term in the Agreement would meet the genuine needs of both the employee and the employer if a request to vary the flexible working arrangements at sub clause 18.4 of the Agreement was refused on reasonable business grounds.

[35] Further, sub clause 18.4 already allows an employee and an employer to enter into an agreement on the terms set out in the clause with respect to a change in working arrangements. This clause is not assisted by a flexibility term.

[36] The submissions by the Applicant’s representative with respect to the flexibility term being a negotiated matter agreed between the parties and the fact that the flexibility term has been used in ‘all agreements across the Baiada group of companies and their worksites and was negotiated in goodfaith with the SDA, AMWU, AWU, AMIEU and NUW’, does not assist the Commission in determining whether the flexibility clause meets the requirements of Act that the term provides flexibility in order to meet the genuine needs of the employee and the employer.

[37] I am of the view therefore that clause 45 of the Agreement is not a flexibility term as described and required under the Act. It does not provide any flexibility the Agreement does not already allow nor does it provide flexibility in order to meet the genuine needs of the employee and the employer.

[38] Section 202(4) of the Act states that if an enterprise agreement does not include a flexibility term, the model flexibility term is to be taken to be a term of the agreement.

[39] The model flexibility term found at Schedule 2.2 of the Fair Work Regulations 2009 will be taken to be a term of the Agreement. A copy of the model flexibility term is attached at Annexure B.

[40] The Agreement covers all shop employees located at the employer’s Beresfield factory shop. I am satisfied that pursuant to s.186(3A) of the Act, this group is fairly chosen as being operationally or organisationally distinct.

[41] I am satisfied that each of the requirements of ss.187 and 188 of the Act as are relevant to the application for approval have been met.

[42] The SDAEA being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers this organisation.

[43] The Agreement is approved. In accordance with s.54(1) the Agreement will operate from 5 November 2013. The nominal expiry date of the Agreement is 13 August 2017.

COMMISSIONER

Annexure A

Annexure B

 1   [2013] FWCA 3061 (AE401276)

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<Price code G, AE405051  PR543906>