Susan Balog

[2010] FWA 6846

[2010] FWA 6846

FAIR WORK AUSTRALIA

REASONS FOR DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 5, Item 9 - Application for an order remedying reduction in take-home pay resulting from a modern award

Susan Balog
(C2010/4616)

SENIOR DEPUTY PRESIDENT KAUFMAN MELBOURNE, 6 SEPTEMBER 2010

Application for take-home pay order - Reduction in take-home pay.

[1] On 17 August 2010 Ms Susan Balog (applicant) made an application under Schedule 5, Part 3, Item 9 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Transitional Act) for an order remedying an alleged reduction in her take-home pay resulting from the making of a modern award.

[2] The Transitional Act at Item 8 relevantly provides:

“Part 3—Avoiding reductions in take-home pay

8 Part 10A award modernisation process is not intended to result in reduction in take-home pay

(1) The Part 10A award modernisation process is not intended to result in a reduction in the take-home pay of employees or outworkers.

(2) An employee’s or outworker’s take-home pay is the pay an employee or outworker actually receives:

(a) including wages and incentive-based payments, and additional amounts such as allowances and overtime; but

(b) disregarding the effect of any deductions that are made as permitted by section 324 of the FW Act.

Note: Deductions permitted by section 324 of the FW Act may (for example) include deductions under salary sacrificing arrangements.

(3) An employee suffers a modernisation-related reduction in take-home pay if, and only if:

(a) a modern award made in the Part 10A award modernisation process starts to apply to the employee when the award comes into operation; and

(b) the employee is employed in the same position as (or a position that is comparable to) the position he or she was employed in immediately before the modern award came into operation; and

(c) the amount of the employee’s take-home pay for working particular hours or for a particular quantity of work after the modern award comes into operation is less than what would have been the employee’s take-home pay for those hours or that quantity of work immediately before the award came into operation; and

(d) that reduction in the employee’s take-home pay is attributable to the Part 10A award modernisation process.

...”

[3] The effect of the Transitional Act is that if an applicant can satisfy Fair Work Australia that he or she has suffered a modernisation-related reduction in his or her take-home pay, then Fair Work Australia is permitted to make an order remedying that reduction. 1

[4] The applicant is an employee of Fast Future Brands Pty Ltd, a national system employer that employs between 750 and 800 people around Australia 2. The applicant has very particular working circumstances, due to her being engaged in full-time study as well as her responsibilities as a single-parent caring for two young children3. The applicant’s working circumstances are that she only works on Sundays, and usually for three hours on each occasion, although sometimes a four hour shift is worked4.

[5] Prior to 1 January 2010, the applicant was paid according to the Shop, Distributive and Allied Employees Association - Victorian Shops Interim Award 1994 5 (the Pre-Reform Award). Since 1 January 2010, the applicant has been paid according to the General Retail Industry Award6 (the Modern Award).

[6] As a consequence of the award modernisation process, there has been a reduction in the hourly rate for an employee performing work on a Sunday in the process of the retail industry transitioning from the Pre-Reform Award to the Modern Award. The applicant demonstrated this at the hearing by presenting two pay slips, which were not disputed by the employer, that identified a Pre-Reform Award rate as $19.83, whereas the Modern Award rate is $16.47. The hourly rates under both the Pre-Reform and the Modern Awards are also subject to a 200% Sunday loading, which takes the take-home hourly rate on a Sunday to $39.66 under the Pre-Reform Award, and $32.94 under the Modern Award.

[7] It is apparent that the take-home pay of the applicant for working on a Sunday has decreased by an amount of $6.72 per hour, inclusive of the 200% loading.

[8] In oral submissions at the hearing, the employer agreed that the applicant’s rate of pay had been reduced, and the reason for this was because the employer had amended rates “in line with what the modern award had specified” 7.

[9] Also at the hearing, the employer noted that it had made an offer to the applicant for her to work additional hours, at the Modern Award rate, in order to allow her to make up for her lost income. Whilst I accept that the employer did not wish to decrease the applicant’s take-home pay, and thus offered her additional hours, I do not accept that the offer is acceptable as an alternative to a take-home pay order. The employer, in essence, is seeking that the employee work more hours for less pay.

[10] I am satisfied that the applicant has met the criteria set out in Item 8(3) of the Transitional Act, specifically that:

(a) a modern award made in the Part 10A award modernisation process applied to the applicant when the award came into operation; and

(b) the applicant is employed in the same position as (or a position that is comparable to) the position she was employed in immediately before the modern award came into operation; and

(c) the amount of the applicant’s take-home pay for working particular hours after the modern award came into operation is less than what would have been the applicant’s take-home pay for those hours immediately before the award came into operation; and

(d) that the reduction in the applicant’s take-home pay is attributable to the Part 10A award modernisation process.

[11] Each matter turns on it’s own circumstances, and this is no exception. Due to the applicant’s very particular working pattern, she has suffered an award ‘modernisation-related reduction in take-home pay’. Accordingly, the application is granted and an order will be issued with this decision.

SENIOR DEPUTY PRESIDENT

Appearances:

Balog, S, appearing for herself.

Kim, H, appearing for Fast Future Brands Pty Ltd.

Hearing details:

2010

MELBOURNE

30 AUGUST

 1 Schedule 5, Part 3, Item 9 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009

 2   PN40

 3   PN8

 4   PN63-66

 5   AP796250CRV

 6   MA000004

 7   PN14

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