Transport Workers’ Union of Australia

[2023] FWC 762

[2023] FWC 762

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.319 - Application for an order relating to instruments covering new employer and non-transferring employees

Transport Workers’ Union of Australia

(AG2023/669)

DEPUTY PRESIDENT DEAN CANBERRA, 5 APRIL 2023

Application for an order relating to instruments covering new employer and non-transferring employees.

1. Hillbus Co Pty Ltd (Hillbus) has retained a bus operations contract from Transport for NSW. As part of the contract, Hillbus will transfer its workforce to the newly established related entity, CDC NSW Region 4 Pty Ltd (CDC).

1. Hillbus and its current employees are parties to the CDC and TWU Drivers Agreement 2022 and the CDC Dural Depot Drivers Agreement 2022 (the Agreements). By virtue of s.312(1)(a) of the Fair Work Act 2009 (the Act), the Agreements become transferable instruments and cover CDC and its transferring employees in relation to the transferring work in accordance with s.313(1).

1. The Transport Workers’ Union of Australia (TWU) has applied under section 319(1)(b) of the Act for orders that the Agreements that cover CDC, will also cover non-transferring employees who perform the transferring work for CDC. Analogous applications were made by CDC but were subsequently discontinued on 16 March 2023 (the discontinued applications).

1. The TWU filed written submissions in support of the application and sought the matter to be determined on the papers. CDC was notified of the application and indicated that it did not oppose the application and did not seek to be heard. In the circumstances, I consider it appropriate to determine the matter based on the material before the Commission.

Relevant Legislation

1. Section 314 of the Act provides:

314 New non-transferring employees of new employer may be covered by transferable instrument
(1) If:

(a) a transferable instrument covers the new employer because of paragraph 313(1)(a); and
(b) after the transferable instrument starts to cover the new employer, the new employer employs a non-transferring employee; and
(c) the non-transferring employee performs the transferring work; and
(d) at the time the non-transferring employee is employed, no other enterprise agreement or modern award covers the new employer and the non-transferring employee in relation to that work;

then the transferable instrument covers the new employer and the non-transferring employee in relation to that work.
(2) A non-transferring employee of a new employer, in relation to a transfer of business, is an employee of the new employer who is not a transferring employee.
(3) This section has effect subject to any FWC order under subsection 319(1).

1. Section 319(1) of the Act sets out the provisions for orders that the Commission may make in relation 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;
(c) an order that an enterprise agreement or a modern award that covers the new employer does not, or will not, cover a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer.

Note: Orders may be made under paragraphs (1)(b) and (c) in relation to a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer, whether or not the non-transferring employee became employed by the new employer before or after the transferable instrument referred to in paragraph (1)(b) started to cover the new employer.

1. Section 319(3) of the Act further sets out the matters that the Commission must take into account in deciding whether to make an order:

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.”

Submissions

1. The TWU’s submissions address each of the provisions under s.319(3) of the Act which I am required to consider.

Views of the new employer– s.319(3)(a)(i)

1. The Commission has received email communication from CDC that it does not oppose the application. The TWU submits that this supports the making of the orders sought.

Views of the employees who would be affected by the order - s.319(3)(a)(ii)

1. The TWU claims that it represents the existing employees and has the right to represent future employees who will be affected by the application. The TWU submits that it has received overwhelming support from its members who lobbied the union to make the current application after the earlier applications were discontinued.

Whether any employees would be disadvantaged by the order - s.319(3)(b)

1. The TWU asserts that in the absence of the orders sought, non-transferring employees of CDC will be engaged pursuant to the Passenger Vehicle Transportation Award 2020 (the Award). Non-transferring employees will be better off overall being covered by the Agreements in comparison to the pay and conditions under the Award.

The nominal expiry date of the agreement - s.319(3)(c)

1. The Agreements both have a nominal expiry of 30 June 2026. It is submitted that the Agreements were only recently approved by the Commission and were achieved on the proviso that the pay and conditions would continue to apply to employees until 2026.

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

1. The TWU notes that in the discontinued applications made by CDC, it was submitted that there would be no disadvantage to the productivity of the workforce as a result of the transferrable instrument extending to non-transferring employees. It submits that the fact that the CDC does not oppose the current application indicates that there are no concerns of any negative impact on productivity.

Any significant economic disadvantage to the new employer - s.319(3)(e)

1. The TWU submits that the CDC has stated in their discontinued applications that there would also be no economic disadvantage as a result of the transferrable instrument being applied to their new employees. This is supported by the fact that CDC does not oppose the application.

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

1. The TWU claims that there will be a higher degree of business synergy if transferring and non-transferring employees are engaged in accordance with the same employment conditions under the Agreements.

The Public interest - s.319(3)(g)

1. The TWU submits that it is in the public interest that the transition of Transport for NSW bus operations contracts take place smoothly and without generating concerns amongst employees and the greater public. It is also in the public interest to ensure that employees working within the same yard that are engaged by the same employer and are subject to the same employment conditions. This will ensure that there is no two-tier workforce that are competing with one another whilst completing the same work.

Consideration

1. I have considered the material provided by the Applicant and accept the matters put in support of the orders sought.

1. Taking into account each of the matters set out in s.319(3) of the Act, I am satisfied that the orders should be made. The orders will be issued with this decision.

DEPUTY PRESIDENT

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