Terrestria Pty Ltd

[2013] FWC 4795

[2013] FWC 4795

FAIR WORK COMMISSION

DECISION

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

Terrestria Pty Ltd
(AG2013/5905)

Scientific services
COMMISSIONER SIMPSON	BRISBANE, 24 JULY 2013

Application for approval of Terrestria Pty Ltd - Single Enterprise Agreement - dismissed

[1] An application has been made for approval of an enterprise agreement known as the Terrestria Pty Ltd - Single Enterprise Agreement (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It was made by Terrestria Pty Ltd.

[2] On the 1 July and 10 July 2013 correspondence was sent to the applicant raising issues of concern. These issues were identical to the issues that were identified in their previous lodgement of matter AG2013/4888 which was withdrawn.

[3] The key issues were as follows;

1. The Applicant has not nominated a relevant award with which to compare the Terrestria Agreement. The Commissioner has identified two relevant modern awards with which to compare the Terrestria Agreement;

2. The maximum weekly hours of work under the NES (s 62 of the Act) is 38 hours. The Terrestria Agreement purports to set the ordinary hours of work at 40 hours per week. This is in conflict with the NES; and

3. Better-off-overall test (BOOT) analysis and concerns arising.

Relevant awards:

[4] I note the Applicant nominated the Biodiversity Assessment and Management Pty Ltd Single Enterprise Agreement 2009 (Biodiversity Agreement) as an agreement that has dealt with identical or substantially identical terms as the Terrestria Agreement.  I advised that the age of the Biodiversity Agreement precludes it from being considered in this context.

Maximum weekly hours under the NES:

[5] The maximum weekly hours of work under the NES (s 62 of the Act) is 38 hours.

Section 62 of the Act states:

Maximum weekly hours of work

(1)  An employer must not request or require an employee to work more than the following number of hours in a week unless the additional hours are reasonable:

(a)  for a full-time employee--38 hours; or

(b)  for an employee who is not a full-time employee--the lesser of:

(i)  38 hours; and

(ii)  the employee's ordinary hours of work in a week.

Employee may refuse to work unreasonable additional hours

(2)  The employee may refuse to work additional hours (beyond those referred to in paragraph (1)(a) or (b)) if they are unreasonable...

[6] In the case of a dispute arising in regards to an employee being requested to work more than 38 hours a week, it would be a matter for the Commission to decide whether additional hours are reasonable against the criteria in s 62(3) of the Act.

[7] Clause 24 of the Terrestria Agreement purports to set the ordinary hours of work at 40 hours per week. This is in conflict with the NES.

[8] Clause 25 of the Terrestria Agreement also purports to set a part-time employee’s hours as those fewer than 40 hours per week. This is in conflict with the NES.

Better off overall test:

[9] The Agreement contains a number of clauses that may be detrimental to employees as compared to the relevant awards. These are:

General issues:

1. Clauses 24-26 of the Terrestria Agreement appear to cover full-time, part-time and casual employees working an average of 40 hours per week on any day — Monday to Sunday. This issue has been addressed above at “Maximum weekly hours under the NES”;

2. The Terrestria Agreement does not contain a span of ordinary hours, Saturday penalties for work undertaken in ordinary hours, annual leave loadings or shift loadings. The relevant awards provide for these items depending on the award the employee’s classification would come under;

3. Clause 27.4 of the Terrestria Agreement appears to be a term providing for preferred hours or voluntary hours on Sundays or public holidays at ordinary time rates, this may be detrimental to the employee as compared to the relevant award;

4. Clause 27.3 of the Terrestria Agreement is not clear if it applies to employees working their ordinary hours on a Sunday or public holiday; and

5. Clause 20.3 of the Terrestria Agreement states casual employees are entitled to a casual loading of 20%, under both of the relevant awards a casual employee is entitled to a higher loading (this should be considered in the context of the overall rate of pay for those employees).

Professional Scientist:

1. A professional scientist is covered by the Professional Employees Award (See Schedule B — Classification Structure and Definitions of the Professional Employees Award).

The Professional Employees Award does not provide overtime, shift or weekend penalties — rather, this award places an obligation on the employer to compensate the employee by granting a number of other benefits as outlined in clause 18.3 of the Professional Employees Award. It is noted that under clause 18.3 such compensation or remuneration should include consideration of the penalty rate or equivalent and the conditions as applicable from time to time to the majority of employees employed in a particular establishment in which the employee is employed.

2. The casual loading in the Terrestria Agreement is lower than the Professional Employees Award, which is transitioning to 25% by 1 July 2014. The classification structure in the Terrestria Agreement appears to mirror the Professional Scientists’ Award. The wage rates in the Terrestria Agreement appear to be inclusive of the superannuation guarantee pursuant to the Superannuation Guarantee (Administration) Act 1992.

3. In a preliminary comparison of wage rates as compared between the Terrestria Agreement (excluding the superannuation component) and the Professional Employees Award. On that analysis it appears level 1 and level 2 employees are significantly below the current award rate of pay.

Administration:

1. Administrative staff are covered by the Clerks Award (see Schedule B — Classifications to the Clerks Award).

2. Clause 27.1 of the Clerks Award provides for overtime of time and a half for the first two hours and double time thereafter. Clause 27.2 provides that ordinary time worked on Saturdays attracts time and a quarter during the spread of ordinary hours and double time on Sundays. Afternoon and night shifts attract a 15% loading with permanent night shift attracting a 30% loading. The casual loading in the Terrestria Agreement is 20%, whereas the Clerks Award is transitioning to 25% by 1 July 2014. Again, the wages relating to administrative staff in the Terrestria Agreement are inclusive of superannuation.

3. In a preliminary comparison of wage rates as compared between the Terrestria Agreement (excluding the superannuation component) and the Clerks Award. It appears level 1 and level 2 employees are significantly below the award rate of pay.

Operational Employees:

1. The Applicant did not specify which award “operational employees” (as outlined in the Terrestria Agreement) would come under. I hold similar concern for operational employees to those raised for professional scientists and administrative staff above.

[10] I provided an opportunity for the Applicant to give a better-off-overall analysis comparing the position of employees on a regular roster under the Agreement with the position of that same employee on the same roster under the Award and in compliance with the NES (in particular the maximum weekly hours of work provisions in the NES and the relevant award). I requested a comparison to include weekdays, weekends (with particular reference drawn to Saturday work), public holidays, night shifts and overtime and any relevant allowances. The analysis was to be done for each classification and pay scale specified under the Agreement.

[11] I also provided an opportunity for the Applicant to give the undertakings as follows:

Notwithstanding clause 24 of the Agreement, the employer must not request or require a full-time employee to work more than 38 hours a week, unless the additional hours are reasonable, in accordance with the National Employment Standards.

Notwithstanding clause 25 of the Agreement, the employer must not request or require an employee who is not a full-time employee to work more than the lesser of: a) 38 hours; and, b) the employee’s ordinary hours of work in a week, unless the additional hours are reasonable, in accordance with the National Employment Standards.

[12] On 17 July 2013 the Applicant requested an extension of time in providing a response to the email dated 10 July 2013 that requested the undertakings. An extension was granted until close of business on 19 July 2013.

[13] The Applicant failed to provide a response by 19 July 2013. On 22 July 2013 another email was sent to the Applicant requesting a response as a matter of urgency.

[14] There was no response from the Applicant. Accordingly the application must be dismissed.

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