[2018] FWC 2004

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Sunnyfield
(AG2017/3992)

SUNNYFIELD SHARED LIVING GROUP HOMES ENTERPRISE AGREEMENT 2017-2018

Social, community, home care and disability services industry

DEPUTY PRESIDENT KOVACIC

CANBERRA, 6 APRIL 2018

Application for approval of the Sunnyfield Shared Living Group Homes Enterprise Agreement 2017 – 2018 – Agreement does not pass the better off overall test – Application dismissed.

[1] An application has been made for approval of an enterprise agreement known as the Sunnyfield Shared Living Group Homes Enterprise Agreement 2017-2018 (the Agreement). The application was received by the Fair Work Commission (the Commission) on 4 September 2017. The Application was made by Sunnyfield (the Applicant) pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single enterprise agreement.

[2] The Health Services Union (NSW) (HSU) in its Form F18 – Statutory Declaration of employee organisation in relation to an application for approval of an enterprise agreement (other than a greenfields agreement) stated that it disagreed with one or more of the answers given to questions in the Form F17 – Employer’s statutory declaration in support of an application for approval of an enterprise agreement (other than a greenfields agreement). Specifically, the HSU in its Form F18 referred to clause 22 – Length of shifts and the management of overtime of the Agreement stating that “the trigger for overtime is 12 hours per day, which is above the Social, Community, Home Care and Disability Services Industry Award 2010 trigger of 10 hours per day.” Nevertheless, the HSU supported the approval of the Agreement.

[3] On 15 December 2017 the Commission’s Member Support Research Team sent an email to the Applicant setting out the Commission’s preliminary views regarding the Agreement. The email read as follows:

“The Deputy President has reviewed the file and notes the following:

1. Clause 8 of the agreement indicates that flexibility provisions will be in accordance with the Award. The flexibility provision of the Social, Community, Home Care and Disability Services Award 2010 (the Award) does not appear to meet all of the requirements of section 203 of the Fair Work Act 2009. For example, the Award flexibility provision does not state that the individual flexibility arrangement must only be about matters that would permitted matters if the arrangement were an enterprise agreement and must not include a term that would be an unlawful term if the arrangement were an enterprise agreement. The Deputy President wishes to inform the parties that in the event the agreement is approved, the model flexibility term will be inserted as a term of the agreement. You are not required to take any action in relation to this issue.

2. Clause 29 of the agreement provides that for those employees who commenced employment before the agreement commenced, the employer will apply the long service leave provisions in the NAPSA previously applying to these employees. Employees who commence employment after the agreement commenced will be paid long service leave in accordance with the Award. The NAPSA referred to does not appear to be defined and the Award does not appear to provide for long service leave. The Deputy President invites you to provide an undertaking in relation to this issue.

3. Clause 2.3 of the agreement provides that the agreement will be read in conjunction with the Award. It appears that it was the intention of the parties to incorporate the Award. The Deputy President is of the view that the words ‘in conjunction’ do not achieve that result. If incorporating the Award was the intention of the parties, the Deputy President invites you to provide an undertaking to that effect.

4. Clause 16 of the agreement indicates that the rates of pay are in accordance with the award and the pay equity order. It is unclear how employees offered Award rates of pay will be better off under the agreement than under the Award. You may wish to provide submissions in relation to this issue.

5. The agreement provides that the ordinary hours of a full time employee may be worked up to 12 hours per shift and employees (including part time employees) will be entitled to overtime for work in excess of 12 hours on any one shift. The Award provides that by agreement, the ordinary hours of work may be up to 10 hours per shift and overtime is payable for work done in addition to the rostered ordinary hours on any day. It does not appear that employees paid Award rates of pay who would otherwise be entitled to overtime for work in excess of 10 hours per day will be better off overall under the agreement than under the Award. You may wish to provide an undertaking in relation to this issue.

6. Clause 26 of the agreement states that employees who are required to attend compulsory training and/or meetings outside the employee’s ordinary hours of work will be paid at the ordinary time rate. It appears that under the Award employees attending compulsory training and/or meetings outside ordinary hours would be entitled to overtime. Employees otherwise entitled to overtime for attendance at compulsory training and/or meetings outside ordinary hours may not be better off overall under the agreement than under the Award. You may wish to provide an undertaking in relation to this issue.

If undertakings are to be provided, please ensure that they are signed by the employer as required by section 2.07 of the Fair Work Regulations 2009. The Deputy President has also asked that you seek the views of any bargaining representatives regarding proposed undertakings. Any objections to the proposed undertakings should be raised with the Commission prior to the approval of the agreement.”

[4] The Applicant responded on 12 January 2018 and in doing so proffered an undertaking in respect of clause 26 of the Agreement. However, the Applicant’s response did not satisfy the Commission’s concerns regarding a number of elements of the Agreement. This resulted in further correspondence between the Commission and the Applicant, primarily in relation to whether the Agreement passed the better off overall test (BOOT). On 19 February 2018 the Commission sent an email to the Applicant which inter alia raised a further issue regarding the Agreement. Specifically, the Commission sought the Applicant’s view as to whether clause 13 - Redundancy of the Agreement was an unlawful term on the basis that it was discriminatory term.

[5] In subsequent developments and against the background of the Commission’s concern as to whether the Agreement passed the BOOT, on 14 March 2018 the Commission listed the application for a mention and directions hearing. Permission was granted for the Applicant to be represented at that hearing, with Mr Brian Williamson appearing with Ms Margaret Loumbos, Sunnyfield’s Executive Manager Human Resources, for the Applicant and Ms Emma Williams appearing for the HSU. At the hearing both parties made oral submissions regarding the application and advised that they did not wish to have the opportunity to provide any further submissions in writing.

The Applicant’s case

[6] In its Form F17 the Applicant declared that it thought the Agreement passed the BOOT 1. In its response of 12 January 2018 to the Commission’s preliminary views regarding the Agreement the Applicant stated as follows in respect of the 12 hour shift issue:

“This request from our employees, which was supported by the Union, initially drove the request from staff and the union for an EBA. Sunnyfield were supportive of this request as it created a family friendly, flexible working environment for our largely female workforce and was based on a risk assessment. Employees requested 12 hour shifts so that their working hours and week could be consolidated, thereby offering working conditions more conducive to working parents and single parents, reducing travel times and days worked. This was a vital issue for staff during negotiations.”

[7] Further, on 14 February 2018 the Applicant proffered the following undertaking regarding the 12 hour shift issue:

“In relation to the implementation/continuation of 12 hour shifts, Sunnyfield undertakes that where staff request to work 12 hour shifts, they confirm that request by completing and signing a “12 hour shift nomination form”.”

[8] At the hearing, the Applicant set out the context within which negotiations for the Agreement occurred, characterising the Agreement as effectively a “rollover” agreement which largely reflected the current agreement, the Sunnyfield Housing & Support Division Group Home Enterprise Agreement 2012-2015 2. More specifically, the Applicant submitted that:

• the Agreement was a holding pattern agreement pending the implementation of the National Disability Insurance Scheme (NDIS) and the associated move from block to individual funding; and

• the approach underpinning the Agreement was that the relevant modern award, the Social, Community, Home Care and Disability Services Award 2010 3 (the Award), would apply subject to some exceptions.

[9] With regard to the issue of 12 hour shifts, the Applicant posited that:

• particularly in the central coast area of NSW a lot of employees wanted to work 12 hour shifts because they have second jobs and/or for lifestyle reasons;

• close to 200 of the over 330 employees who would be covered by the Agreement have elected to work 12 hour shifts;

• it could not afford to go into an overtime arrangement for shifts exceeding 10 hours (the maximum ordinary hours which can be worked per shift under the Award 4);

• working 12 hour shifts provided employees with a break from difficult clients; and

• the request for 12 hour shifts came from employees rather than the Applicant.

[10] Beyond that, key aspects of the Applicant’s submissions included that:

• in terms of access to the enhanced sleepover and nauseous linen allowances provided in the Agreement, not all employees would receive the nauseous linen allowance and, whilst the sleepover allowance was broadly accessed, some employees did not undertake sleepovers; and

• the enhanced redundancy arrangements provided for in the Agreement had been in existence for some time and constituted positive discrimination similar to the extra weeks’ notice provided in the National Employment Standards (NES) to employees over 45 years of age who had completed at least 2 years continuous service.

The HSU’s case

[11] The HSU agreed with the Applicant’s submissions regarding the Agreement’s redundancy provision. However, in respect of the 12 hour shift issue, the HSU submitted that while it understood the Applicant’s circumstances it believed that employees should have the option of receiving the overtime payment for 2 hours in circumstances where they worked a 12 hour shift.

Consideration of the issues

[12] Initially I would indicate that the undertakings proffered by the Applicant in respect of clauses 2.3, 26 and 29 of the Agreement address the concerns raised by the Commission in respect of those provisions (see paragraph [3] above).
[13] A key issue in dispute in this case is whether the Agreement passes the BOOT. In this regard I note that the rates of pay provided for in the Agreement reflect those provided in the Award and associated Equal Remuneration Order 5. Further, the Agreement incorporates the Award.

[14] The more beneficial aspects of the Agreement relative to the Award are:

• a sleepover allowance of $80.00 per night as opposed to $45.45 per night under the Award (a differential of $24.55 per night);

• a nauseous linen allowance of $2.50 per week which may be claimed for one or more occurrences of the need to clean up, wash and replace client related nauseous linen – the Award does not provide for such a payment; and

• the employer paying the costs associated with employee criminal record and working with children checks – again the Award does not provide for this.

[15] In addition, the redundancy benefits provided for in the agreement exceed those in the NES for all but employees under the age of 45 with less than 2 years’ service.

[16] As to the less beneficial aspects of the Agreement, under the Award employees working 12 hour shifts would be entitled to 2 hours overtime, paid at time and a half, for each 12 hour shift worked Monday to Saturday (there would be no differential for 12 hour shifts worked on Sundays or public holidays). The pay differential ranges from $19.88 per shift for a Social and community services employee level 1 at pay point 1 to $35.49 per shift for a Social and community services employee level 8 at pay point 3 for shifts worked Monday to Saturday. As noted above, at the hearing the Applicant indicated that close to 200 employees had nominated to work 12 hour shifts.

[17] Weighing up the more beneficial and less beneficial aspects of the Agreement, I note the Applicant’s email advice of 6 February 2018 which indicated that an average of 192 employees would have benefitted from the enhanced sleepover allowance and an average 131 employees would have benefitted from the nauseous linen allowance (with those averages based on the previous three months had the Agreement been in operation). Further, while I note the Agreement’s enhanced redundancy provision, I consider the weight that can be attached to that more beneficial provision is diminished by the fact that the benefit only crystallises in circumstances where an employee is made redundant. Lastly, I note that the Applicant also advised on 6 February 2018 that criminal record and working with children checks are compulsory and that every staff member is reimbursed for the costs associated with these checks. However the Applicant provided no information as to the frequency or cost of these checks. In that regard, I note that the website of the NSW Office of the Children’s Guardian states that a Working With Children Check currently costs $80 and is valid for 5 years 6. In other words, the value of this benefit would differ across employees though it would clearly benefit all new employees.

[18] Having regard to the above analysis, on balance I am not satisfied that the Agreement passes the BOOT. More specifically, I do not consider that those employees who elect to work 12 hour shifts will be better off overall under the Agreement despite the Agreements more beneficial provisions. In respect of the 12 hour shift issue, the Applicant advised the Commission on 12 January 2018 that “There is no advantage to Sunnyfield in paying overtime for the 11th and 12th hours worked if employees are not required to work ordinary hours on other days. Sunnyfield cannot give this undertaking.” Further, as mentioned above, at the hearing the Applicant submitted it could not afford to go into an overtime arrangement for shifts exceeding 10 hours. Accordingly in the absence of an undertaking to address the remaining BOOT issue regarding 12 hour shifts, the Commission cannot approve the Agreement.

[19] Finally, in respect of the Agreement’s redundancy clause, I would indicate that having regard to the parties submissions and the decision of President Fisher of the Industrial Commission of New South Wales (NSWIRC) in Shop, Distributive & Allied Employees’ Assn (N.S.W.) & Ors v Countdown Stores & Ors 7 I am satisfied that the provision is not discriminatory but rather is intended to recognise the “added difficulty” attached to redundancy for employees over the age of 458. By way of background, Fisher P determined in the above decision that employees who attained the age of 45 should be paid at the rate of 1.25 weeks for every week of severance pay they were entitled to under the scale of severance payments he determined in that decision. Further, I note that that differential was subsequently reflected in the Nurses (Private Sector) Redundancy (State) Award9, an award of the NSWIRC, which provided for severance payments identical to those set out in the Agreement.

Conclusion

[20] For all the above reasons I am not satisfied that the Agreement passes the BOOT. Accordingly the Agreement cannot be approved and the application will be dismissed. An Order to that effect will be issued in conjunction with this Decision.

Appearances:

B. Williamson with M. Loumbos for the Applicant
E. Williams for the HSU

Telephone hearing:

2018

Canberra and Sydney

March 20

1 Response to Item 3.6 of the Form F17

2 AE895831

3 MA000100

4 Ibid at clause 25.1(b)

5 PR525485

6 (1983) 7 IR 273

8 Ibid at 293

9 AN120380

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