The Forward Road Pty Ltd T/A The Forward Road

[2017] FWC 4210

[2017] FWC 4210

FAIR WORK COMMISSION

DECISION

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

The Forward Road Pty Ltd T/A The Forward Road
(AG2017/3045)

DEPUTY PRESIDENT KOVACIC CANBERRA, 14 AUGUST 2017

Application for an order relating to instruments covering new employer and non-transferring employees in agreements - orders made that the JBC Canberra Enterprise Agreement 2013 will apply to any transferring employees and non-transferring employees who perform or are likely to perform the transferring work of the new employer.

[1] This decision concerns an application made pursuant to ss.318 and 319 of the Fair Work Act 2009 (the Act) by the Forward Road Pty Ltd T/A The Forward Road (the Applicant) seeking orders that:

• the JBC Canberra Enterprise Agreement 2013 (the Agreement) cover transferring employees; and



• the Agreement covers non-transferring employees who perform or are likely to perform the transferring work of the new employer

[2] The application was heard on 11 August 2017 with Mr Rob Woolley, a director of the Applicant, appearing for the Applicant together with Mr Fergus Nelson, a director of Just Better Care Canberra (JBCC) and co-owner with Mr Woolley of the Applicant.

[3] By way of background, the application arises in circumstances where Mr Woolley has purchased 50 per cent of JBCC which, as a result, is to be rebranded as The Forward Road. The sale is expected to be finalised in early 2018 with all operations to be transferred to the Applicant at that time. The Applicant currently has no employees, while JBCC has approximately 60 employees who will all transfer to the new entity.

Relevant legislation

[4] The relevant sections of the Act are ss.313, 318 and 319 which provide as follows:

“313 Transferring employees and new employer covered by transferable instrument

(1) If a transferable instrument covered the old employer and a transferring employee immediately before the termination of the transferring employee’s employment with the old employer, then:

(a) the transferable instrument covers the new employer and the transferring employee in relation to the transferring work after the time (the transfer time) the transferring employee becomes employed by the new employer; and

...

(3) This section has effect subject to any FWC order under subsection 318(1).

318 Orders relating to instruments covering new employer and transferring employees

Orders that FWC may make

(1) FWC 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.

…

Who may apply for an order

(2) FWC 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;

…

Matters that FWC must take into account

(3) In deciding whether to make the order, FWC 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.

Restriction on when order may come into operation

(4) The order must not come into operation in relation to a particular transferring employee before the later of the following:

(a) the time when the transferring employee becomes employed by the new employer;

(b) the day on which the order is made.

319 Orders relating to instruments covering new employer and non- transferring employees

Orders that the FWC may make

(1) The FWC 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 non-transferring employee because of subsection 314(1) does not, or will not, cover the non-transferring employee;

(b) an order that a transferable instrument that covers, or is likely to cover, the new employer, because of a provision of this Part, covers, or will cover, a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer;

…

Matters that the FWC must take into account

(3) In deciding whether to make the order, the FWC 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. “

[5] Before turning to consider each of the matters specified in s.318(3) and s.319(3) of the Act, I note that the Forward Road, as the new employer, has standing pursuant to s.318(2)(a) and s.319(2)(a) of the Act to make the application for the orders sought.

The views of the new employer [s.318(3)(a)(i) and s.319(3)(a)(i)]

[6] The Applicant submitted that employees and the new employer will be unaffected by the orders sought.

The views of the employees who would be affected by the order [s.318(3)(a)(ii) and s.319(3)(a)(ii)]

[7] On 27 July 2017, the Commission invited employees of JBCC to provide a written statement or attend the hearing with no employee expressing a view.

Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment [s.318(3)(b) and s.319(3)(b)]]

[8] The Applicant submitted that no employees will be disadvantaged by the order as all employees are currently working under the Agreement.

The nominal expiry date of the agreement [s.318(3)(c) and s.319(3)(c)]

[9] The JBCC Canberra Enterprise Agreement has a nominal expiry of 13 September 2017.

Whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace [s.318(3)(d) and s.319(3)(d)]

[10] The work environment of the JBCC will be replicated by the Applicant resulting in no negative impact on productivity or the working environment.

Any significant economic disadvantage to the new employer [s.318(3)(e)] and [s.319(3)(e)]

[11] The Applicant submitted that it will not incur significant economic disadvantage as a result of the orders sought, as nothing will change from the current circumstances.

The degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer [s.318(3)(f)] and [s.319(3)(f)]

[12] In its application, the Applicant submitted that this is not relevant to the application as The Forward Road is a new entity.

The public interest [s.318(3)(g)] and [s.319(3)(g)]

[13] The Applicant submitted that The Forward Road and JBCC have the same public interest, therefore the Agreement is applicable to the new employer.

[14] There is no evidence that it would be against the public interest to issue the order.

Conclusion

[15] Taking into account each of the matters set out in ss.318(3) and 319(3), I am satisfied that the orders sought should be made.

[16] The orders (PR595311) will be issued to provide that the Agreement will cover the transferring employees of the Applicant and the non-transferring employees who perform the same or similar work as the transferred employee.

Appearances:

R. Woolley and F. Nelson for the Applicant

Hearing details:

2017.

Canberra:

11 August 2017.

Printed by authority of the Commonwealth Government Printer

<Price code A, AE403800, PR595310 >