Telstra Corporation Limited

[2010] FWA 3898

[2010] FWA 3898

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees in agreements

Telstra Corporation Limited
(AG2010/9406)

Telecommunications services
COMMISSIONER ROE	MELBOURNE, 21 MAY 2010

Application for an order relating to instruments covering new employer and transferring employees in agreements.

[1] On 14 May 2010, Telstra Corporation Limited made application that:

“Pursuant to section 318(1) of the Fair Work Act 2009 (Cth) (Act), that each of the:

(a) Sensis (Clerical and Sales Employees) Award 2000;

(b) Sensis Pty Ltd Employment Partnership Agreement No.2 2001; and

(c) Sensis Advertising &Design Agreement 2003 - 2004,

(together, the Sensis Instruments)

not cover Telstra Corporation Limited (Telstra) or any employee.”

Background

[2] On 30 September 2009, Sensis and Telstra announced that from 30 October 2009 the Trading Post collection of businesses would cease to offer a print edition to customers in order to focus efforts on the online businesses. As a result of the closure of the Trading Post print operations, Sensis made 279 jobs across 9 locations redundant. Sensis is a company in which Telstra has a 100% shareholding.

[3] Telstra wishes to make offers of employment to the 132 Sensis employees who deliver the online Trading Post Services and employ them under the same collective agreement as currently applies to Telstra employees employed in the Telstra Media and Classifieds business group. The relevant collective agreement is the Telstra Media Employee Collective Agreement 2009-2012 (Telstra Media ECA).

[4] The matter was listed for hearing on 21 May 2010. Leave was granted for Mr C. O’Grady to appear for Telstra and Mr J. Bornstein to appear for the AMWU. Ms T Davison appeared for the CPSU. Evidence was provided by Lauren Sheens, Senior Human Resources Business Partner – Telstra Voice, Broadband and Media. Her evidence included documentation of the fact that all affected employees were provided with a copy of the application in this matter, and were provided with briefing on the transfer of applicable industrial instruments proposed by Telstra, and its implications. Further her evidence included that 118 of the affected employees completed a survey concerning the transfer and that 116 of those employees indicated that they had attended a briefing session and that 118 of those employees had confirmed that they had had the opportunity to speak to a manager or HR advisor on the matter. 112 of the 118 employees indicated that they did not object to being covered by the Telstra Media ECA. An additional employee subsequently indicated that they did not have an objection.

[5] The evidence of Ms Sheens also included a table which compared the current fixed remuneration (including super and leave loading) and the current total remuneration with the fixed and total remuneration which would apply to each transferring employee. That table demonstrated that no employee would suffer a decline in either fixed or total remuneration. The briefing material provided to employees and provided as part of the evidence of Ms Sheens also compared the wages and conditions of employment provided under the industrial instruments currently applying to the employees and the Telstra Media ECA. This summary showed that in broad terms there was no detriment in wages and conditions of employment.

[6] The CPSU advised that subject to receipt of an undertaking they did not oppose the transfer of applicable industrial instruments to the Telstra Media ECA in respect of employees covered by the Sensis (Clerical and Sales Employees) Award 2000 and or the Sensis Pty Ltd Employment Partnership Agreement No 2 2001. The undertaking sought by the CPSU and given by Mr O’Grady in proceedings on behalf of Telstra was that to avoid doubt; all service with Sensis by the affected employees will be recognised for the purpose of parental leave, personal leave and redundancy.

[7] The AMWU indicated that they did not support the application at this stage in respect to the employees covered by the Sensis Advertising & Design Agreement 2003-2004. The AMWU is a party to that Agreement. I indicated my intention based on the evidence provided to issue a decision in respect to the employees covered by the Sensis (Clerical and Sales Employees) Award 2000 and/or the Sensis Pty Ltd Employment Partnership Agreement No 2 2001. I determined that I would hear further evidence and submissions in respect to the application in respect to the employees covered by the Sensis Advertising & Design Agreement 2003-2004. In respect to those employees directions were issued in respect to the filing of witness statements and submissions in reply and that matter will be the subject of further hearing and decision. This decision relates solely to those employees covered by the Sensis (Clerical and Sales Employees) Award 2000 and/or the Sensis Pty Ltd Employment Partnership Agreement No 2 2001.

The legislation

[8] Section 318 of the Fair Work Act 2009 provides that:

“318 Orders relating to instruments covering new employer and transferring employees

Orders that FWA may make

(1) FWA may make the following orders:

(a) an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;

(b) an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.

Whomay apply for an order?

(2) FWA may make the order only on application by any of the following:

(a) the new employer or a person who is likely to be the new employer;

(b) a transferring employee, or an employee who is likely to be a transferring employee;

(c) if the application relates to an enterprise agreement—an employee organisation that is, or is likely to be, covered by the agreement;

(d) if the application relates to a named employer award—an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (b).

Matters that FWA must take into account

(3) In deciding whether to make the order, FWA must take into account the following:

(a) the views of:

(i) the new employer or a person who is likely to be the new employer; and

(ii) the employees who would be affected by the order;

(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment;

(c) if the order relates to an enterprise agreement - the nominal expiry date of the agreement;

(d) whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace;

(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;

(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;

(g) the public interest.”

Findings in respect of the employees covered by the Sensis (Clerical and Sales Employees) Award 2000 and/or the Sensis Pty Ltd Employment Partnership Agreement No 2 2001.

[9] The applicant is the new employer and is able to make the application. The application seeks orders that the Telstra Media Employee Collective Agreement (Telstra Media ECA) apply to the transferring employees.

[10] The transferring employees and their union, the CPSU, who would, but for this application, be covered by the Sensis (Clerical and Sales Employees) Award 2000 and/or the Sensis Pty Ltd Employment Partnership Agreement No 2 2001 have not opposed the making of this order and the evidence of Ms Sheens supports this contention.

[11] The views of the new employer, Telstra, is that the application of the Telstra Media ECA will encourage a single and harmonious workplace culture, promote consistency and certainty in employment terms and conditions, and positively impact productivity and efficiency in the workplace.

[12] I am satisfied that the affected employees will not be disadvantaged by the order sought in relation to their terms and conditions of employment.

[13] The Sensis (Clerical and Sales Employees) Award 2000 commenced operations in February 2003 and remains in operation as an enterprise award pursuant the provisions of the Act. The Sensis Pty Ltd Employment Partnership Agreement No 2 2001 has a nominal expiry date of 4 May 2003. The Telstra Media ECA by contrast is a recently agreed instrument which has a nominal expiry date of 7 May 2012.

[14] Telstra gave evidence that the transferable instruments would have a negative impact on the productivity of Telstra. This is primarily because of the effect on the integration of the transferring employees with the other employees of Telstra Media and the administrative costs of managing different policies and procedures.

[15] Telstra gave evidence that it would incur additional costs due to running two contrasting sets of payroll and other systems or due to re-configuring its current system to deal with the Sensis Instruments. I accept that there would be some costs associated with this.

[16] Telstra submitted that there is a lack of business synergy between the Sensis Instruments and the Telstra Media ECA.

[17] No submissions were made that the making of the orders is contrary to the public interest.

Conclusion

[18] I have taken into account the submissions and evidence and, have had regard to the criteria in section 318. My decision in on the basis that Telstra has undertaken that it will recognise all service with Sensis of the transferring employees for the purpose of parental leave, personal leave and redundancy. The granting of the application does not offend the objectives of the protection of employee’s terms and conditions of employment and the business interests of the employer. I will make the following orders pursuant to Section 318(1) of the Fair Work Act 2009:

1. That each of the Sensis (Clerical and Sales Employees) Award 2000 and the Sensis Pty Ltd Employment Partnership Agreement No 2 2001 not cover Telstra Coproration Limited (Telstra) or any employee transferring to Telstra Corporation Limited from Sensis Pty Ltd (Sensis).

2. The order shall have effect in respect of each transferring employee from 21 May 2010 or the date when the transferring employee becomes an employee of Telstra whichever is the later.

COMMISSIONER

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