Toll Transport Pty Ltd
[2023] FWCA 2431
•7 AUGUST 2023
| [2023] FWCA 2431 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.185—Enterprise agreement
Toll Transport Pty Ltd
(AG2023/2215)
TOLL HELICOPTERS ENGINEERS ENTERPRISE AGREEMENT 2022
| Airline operations | |
| DEPUTY PRESIDENT BELL | MELBOURNE, 7 AUGUST 2023 |
Application for approval of the Toll Helicopters Engineers Enterprise Agreement 2022.
An application has been made for approval of an enterprise agreement known as the Toll Helicopters Engineers Enterprise Agreement 2022 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act) by the employer Toll Transport Pty Ltd. The Agreement is a single enterprise agreement.
The notification time for the Agreement under s.173(2) was 29 April 2022 and the Agreement was made on 20 June 2023. Accordingly, the genuine agreement requirements are assessed under the Act as those applying before 6 June 2023 and the better off overall test (BOOT) is that applying on and from 6 June 2023.[1]
One of the bargaining representatives, Mr Duncan Lockwood, filed a Form F18 objecting to the approval of the Agreement. The objection was based on the contention that, for two categories of engineers, the Agreement failed the BOOT. The two categories are ‘Engineering Work Practice 3 (EWP3)’ and ‘Engineering Work Practice 5 (EWP5)’.
Succinctly stated, the issues concerns the ‘on call’ requirements for EWP3 and EWP5 employees and the ‘Standing by’ clause in the relevant award, being the Airline Operations – Ground Staff Award 2020 (Award).
Under the Agreement, the EWP3 and EWP5 work patterns are as follows (underlining added):
“iii. Engineering Work Practice 3 (EWP3)
(a) 8 Days on - 6 Days off and On Call.
1. 7.6 Hours per day. 30 mins unpaid meal break and 2 X 15-minute paid breaks.
2. No travel day applies unless it is in addition to the Engineers EWP standard roster and additional day/s are worked where overtime rates will apply. If traveling on a standalone day, payment will commence in accordance with Schedule 1, Clause 11.
3. Engineer on shift is considered On Call 24-7 (while on 8 days on) and shall attend with reference to fatigue section. On-coming Engineer will be On Call from commencement of shift. If On-coming Engineer is not able to be on call for first night, due fatigue or illness or other, Off-going Engineer will remain on call until 6am of day nine.
4. On occasions, Engineer(s) will be required to change to another EWP to backfill other engineers.
5. On occasions, Engineers will be required to supply back up to Sydney, Orange, Wollongong, Canberra, Oakey, Darwin, Townsville and other bases as applicable, including on Call.
6. Overtime will only be paid where an Engineer’s hours of work extend past the rostered finish time for an operational shift. For the purpose of clarity overtime will only be paid in addition to working 72.00 hours per block. This will be averaged over the entire 8 days on. Except Senior Base Engineer.”
“v. Engineering Work Practice 5 (EWP5)
(a) 15 Days on – 13 Days off and On Call, deployed or split day.
1. 7.6 Hours per day. 30 mins unpaid meal break and 2 X 15-minute paid breaks as required to meet fatigue limits.
2. No travel day applies. However, travel will happen on day 1 and day 15. Between 6 am and 6 pm where possible. Where travel it is in addition to the Engineers EWP standard roster and additional day/s are worked where overtime rates will apply. If traveling on a standalone day, payment will commence in accordance with Schedule 1, Clause 11.
3. On occasions, Engineer(s) will be required to change to another EWP to backfill other Engineers.
4. On occasions, Engineers will be required to supply back up to Sydney, Orange, Wollongong, Canberra, Oakey, Darwin, Townsville and other bases as applicable, including On Call.
5. Overtime will not be paid during any scheduled rostered-on period.
6. Scheduled Maintenance to be conducted, where possible, on change over day to increase efficiency and online availability.
7. Engineer(s) on shift is considered On Call 24-7 (while on 15 days on) and shall attend with reference to fatigue section. On-coming Engineer will be On Call from commencement of shift if no travel occurs.
8. Engineer(s) on shift is considered available to meet operation needs 24-7 while on shift.”
Clause 24.4 of the Award is as follows (underlining added):
“24.4 Standing by
(a) Clause 24.4 applies only to employees in one of the classifications in clause 18.3.
(b) Subject to any custom prevailing at an enterprise, where an employee is required regularly to hold themselves in readiness to work after ordinary hours, the employee must be paid standing by time at the employee’s ordinary hourly rate for the time they are standing by.”
It is because of the ‘on call’ provisions in the Agreement that Mr Lockwood says that employees are “required to regularly hold themselves in readiness for work after ordinary hours.” There did not appear to be any dispute about this element and I am satisfied to proceed on the basis that the nature of the ‘on call’ requirements described in the Agreement would be sufficient to enliven the section of cl. 24.4 of the Award just quoted.
Where the employer and Mr Lockwood diverge is the underlined section of the Award, above. The employer contends that, since at least 2016, there has been a custom prevailing at the workplace such that the relevant employees are regularly required to hold themselves in readiness to work after hours.
After initially receiving material from the parties through correspondence with chambers, I listed the matter for conference on 27 July 2023 to determine if the matter might resolve. It did not resolve, and I issued directions requiring the employer and Mr Lockwood (and any other interested party who chose to do so) to file and serve material upon which they relied, together with any reply. The issues identified for dispute was whether cl 24.4 of the Award should apply in the assessment of the ‘better off overall test’, as well as any calculations or modelling the parties wish to rely upon for the BOOT assessment.
The parties complied with the directions. I briefly record my appreciation to them for complying with the directions generally on what was a relatively short timetable.
Upon reviewing that material, it appeared more appropriate to deal firstly with the question of cl. 24.4 of the Award because, if that matter was determined in favour of the employer, any BOOT calculations or modelling would be unnecessary, particularly having regard to how significantly far above Award rates employees would be paid under the Agreement.
The matter was heard on 4 August 2023. The employer called Mr Seamus Miller, Head of Engineering, to give evidence. Mr Miller was only briefly cross-examined. Mr Lockwood did not file a statement but did file various documents (whose provenance was not in dispute) and submissions.
Ultimately, I consider there was little dispute about the evidence but, as is often the case, the dispute was about what it meant and how the Award relevantly would operate upon those facts.
The critical factual matters relied upon by the employer were two antecedent enterprise agreements, being the Toll Helicopters Engineers Enterprise Agreement 2016 (2016 Agreement) and the Toll Helicopters Engineers Enterprise Agreement 2020 (2020 Agreement).
The employer states that the 2016 and 2020 Agreements demonstrate that there has been, since at least 2016, a custom where EWP3 and EWP5 employees are regularly ‘on call’.
For EWP3 employees, the on-call obligation under the 2016 and 2020 Agreements was stated as follows:
· In the 2016 Agreement, “Engineer on shift is considered On Call 24-7 (while on 8 days on) and shall attend with reference to fatigue section. Including day 9 ‘change over’ until 6am.” (Schedule 2, clause 6.3(a)3.)
· In the 2020 Agreement, “Engineer on shift is considered On Call 24-7 (while on 8 days on) and shall attend with reference to fatigue section. Including day 9 ‘change over’ until 6am.” (Schedule 2, clause 7.3(a)3.)
For EWP5 employees, the on-call obligation was stated as follows:
· In the 2016 Agreement, “Engineer(s) on shift is considered On Call 24-7 (while on 15 days on) and shall attend with reference to fatigue section. Including day 16 ‘change over’ until 6 am if no travel occurs.”
· In the 2020 Agreement, “Engineer(s) on shift is considered On Call 24-7 (while on 15 days on) and shall attend with reference to fatigue section. Including day 16 ‘change over’ until 6 am if no travel occurs.”
The relevant clauses under the current Agreement are materially unchanged since 2016. There was no suggestion that the above clauses from the 2016 and 2020 Agreements operated any differently in substance to those under the current Agreement.
In Logan v Otis Elevator Co Pty Ltd (1999) 94 IR 218 (Logan), a Full Court of the Industrial Relations Court of Australia considered a ‘standing by’ clause of an award that read as follows:
“Standing by
(g) Subject to any custom now prevailing under which an employee is required regularly to hold himself in readiness for a call back, an employee required to hold himself in readiness to work after ordinary hours shall until released be paid standing-by time at ordinary rates from the time which he is so to hold himself in readiness.”
There was some debate in Logan about the extent to which the word “now” operated in the sub-clause “Subject to any custom now prevailing under which…”. In that matter, the word “now” was held not to limit that sub-clause. I note that cl. 24.4 of the Award, which I am considering, does not contain the word “now” at all.
The Full Court held that, in relation to the opening words of the sub-clause (my emphasis):
“the sub-clause does not apply where there is a ‘‘custom’’ under which the employee is regularly required to hold himself in readiness for a call back. In this context the word ‘‘custom’’ means no more than a prevailing and accepted practice. Moore J held there was such a practice in relation to Otis’ local representatives.”
Some of the factual findings made by Moore J referred to by the Full Court included evidence of “24 hours call out”, including evidence of such practices with other employees of the employer both before and after Mr Logan commenced employment with that employer.
I see no material difference between the Award clause I must consider and that considered in Logan. A similar conclusion was reached by Commissioner Gregory, with whose views I respectfully agree, in Re Cummins South Pacific Pty Ltd[2019] FWCA 1245 (Cummins).
In Cummins, Gregory C was considering an identical ‘standing by’ provision as part of a BOOT assessment against an enterprise agreement that provided a ‘Standby Allowance’ of $75 per week. The employer provided evidence demonstrating a practice of regular standby periods going back to at least 2005. The Commissioner was satisfied that the opening sub-clause of the award provision was engaged, such that there was a custom where employees were regularly required to hold themselves in readiness for work after hours.
I, too, am satisfied that, in the case of Toll Transport Pty Ltd, there has been a prevailing and accepted practice, since at least 2016, where EWP3 and EWP5 employees have been on call ‘24-7’ during their 8 days on and 15 days on, respectively. That practice is plainly evidenced by the 2016 and 2020 Agreements and there was no suggestion that actual work practices operated any differently.
Mr Lockwood raised a number of matters against the employer’s position. He contends that “customary” implies what is ordinarily expected and subsequently performed by the employee as part of their regular job responsibilities. He says that customary does not denote a traditional practice. It is not entirely clear to me how Mr Lockwood’s position differs from that stated in Logan but, so far as it does, I apply what was stated in Logan. Perhaps what is at the heart of Mr Lockwood’s objection is that, in his view, EWP3 and EWP5 employees are not adequately compensated for the on call work.
He also contends that there has never been a real opportunity to negotiate for the on call work and says (and there was no dispute to the contrary) that the 2016 Agreement was effectively negotiated as a greenfields agreement. He also says that the 2020 Agreement was negotiated during the COVID-19 pandemic and therefore there was no real opportunity to negotiate the on call component at that time.
I do not consider that EWP3 and EWP5 employees are not sufficiently compensated for the purpose of the BOOT. Mr Lockwood’s argument appears to proceed on the basis that cl.24.4 of the Award does or ought to apply. I disagree. I am satisfied that the opening sub-clause in cl.24.4 of the Award is engaged, such that ‘standing by’ payments are not relevant for the BOOT. Mr Lockwood’s calculations[2] give a value to the standing by time at approximately $92,000. As a result, Mr Lockwood seeks to show that the BOOT fails by about $26,000 (under the Award, he says he would be entitled to about $205,000 and, under the Agreement, about $179,000).
There was some debate about the BOOT calculations. On the employer’s position, the BOOT would be passed even if Mr Lockwood’s proposed ‘standing by’ amounts were included. For avoidance of doubt, it has not been necessary for me to resolve specific BOOT disputes at this granular level (and I do not do so). I referred to Mr Lockwood’s calculations above only to illustrate the general magnitude of the ‘standing by’ component for his claim. I do not need to resolve the granular disputes about the parties’ respective BOOT modelling because I am satisfied that, since there is no applicable ‘standing by’ entitlement under cl.24.4 of the Award, the Agreement significantly passes the BOOT.
There were some other matters that I raised with the parties in correspondence. The employer has provided written undertakings. A copy of the undertakings are attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement. Pursuant to s.201(3), the undertakings are taken to be a term of the Agreement.
Subject to the undertakings referred to above, I am satisfied that each of the requirements of ss.186, 187, 188, 190, 193 and 193A as are relevant to this application for approval have been met. The Agreement does not cover all of the employees of the employer. However, taking into account the factors in sections 186(3) and (3A), I am satisfied that the group of employees was fairly chosen.
The Australian Licensed Aircraft Engineers Association (ALAEA), being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers the organisation.
The Agreement was approved on 7 August 2023 and, in accordance with s.54 of the Act, will operate from 14 August 2023. The nominal expiry date of the Agreement is 30 June 2025.
DEPUTY PRESIDENT
Annexure A
[1] The Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) made a number of changes to enterprise agreement approval processes in Part 2-4 of the Fair Work Act. Those changes broadly commenced operation on 6 June 2023, subject to various transitional arrangements that included those to effect described above.
[2] Mr Lockwood attached an Excel spreadsheet with various calculations to the material he filed on 31 July 2023.
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