Transport Workers' Union of Australia v Coles Supermarkets Australia Pty Ltd

[2015] FWC 1591

[2015] FWC 1591

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.238 - Application for a scope order

Transport Workers' Union of Australia
v
Coles Supermarkets Australia Pty Ltd and others
(B2014/1361)

COMMISSIONER ROBERTS SYDNEY, 17 APRIL 2015

Application for a scope order.

[1] This decision deals with an application for a scope order lodged by the Transport Workers’ Union of Australia (the TWU) on 10 September 2014 pursuant to s.238 of the Fair Work Act 2009 (the Act). The Respondents to the application are Coles Supermarkets Australia Pty Ltd (Coles), the Shop, Distributive and Allied Employees Association (the SDA), the Australian Workers’ Union (the AWU), the Australasian Meat Industry Employees Union (the AMIEU) and a number of named individual bargaining representatives. The TWU is the bargaining representative for employees of Coles who are members of that union. The application is opposed by Coles and the SDA. The application is supported by the AMIEU and ‘not opposed’ by the AWU. Neither the AMIEU nor the AWU took part in hearings.

[2] The application contains the following grounds in support:

“Grounds:

Coles Supermarkets Australia is maintaining that the proposed Store Team Enterprise Agreement 2014 covers the following group of employees:

Drivers effecting delivery of goods ordered through the Coles Online website. These drivers presently referred to as Customer Service Agents.

The Applicant has concerns that bargaining for the proposed collective agreement is not proceedings efficiently or fairly because the agreement will cover employees that it is not appropriate for the agreement to cover.

Particulars:

The Transport Workers’ Union of Australia contends that it is not appropriate for the Store Team Enterprise Agreement 2014 proposed by Coles Supermarkets Australia Pty Ltd to cover drivers employed to undertake the delivery of goods ordered through the Coles Online website.

The Online Department is operationally distinct from the supermarket operation. The drivers report to an Online Manager. The drivers load their trucks from a loading dock outside the supermarket and spend the bulk of their working day driving a truck on the road or at customers’ premises delivering goods. The drivers perform work in a manner that is geographically and operationally removed from in-store operations.

The proposed Store Team Enterprise Agreement 2014 otherwise applies to employees employed to perform duties in a traditional retail environment within a retail store operated by Coles and does not cover employees performing a transport role of the nature undertaken by drivers making deliveries of goods purchased through the Coles Online website.

The proposed Store Team Enterprise Agreement 2014 is an edited version of the existing Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited Retail Agreement 2011. The Coles Supermarkets Agreement has a history dating back to 1986. The Transport Workers’ Union has had no involvement in its development throughout that entire period and those agreements have had no application to employees performing transport work.

Prior to 2010, the delivery of goods ordered through the Coles Online website was sub-contracted by Coles to external transport providers such as Linfox Australia Pty Ltd and others transport operators. Employees undertaking this work were covered by enterprise agreements negotiated by the Transport Worker’s Union and underpinned by conditions in transport awards.

In 2010, Coles commenced directly employing drivers to undertake the delivery of goods ordered through the Coles Online website to take over the delivery function previously undertaken by transport providers. When negotiating the Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited Retail Agreement 2011, Coles expressly excluded drivers from the bargaining and initiated bargaining with the Transport Workers’ Union for a separate agreement to apply to Customer Service Agents.

The existing Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited Retail Agreement 2011 contains only classifications appropriate for persons performing work within the confines of a retail store and does not contain classifications or conditions appropriate for drivers performing delivery work for orders made through the Coles Online website. It is not appropriate that employees undertaking a transport function be incorporated into a retail agreement.

The online delivery drivers have concerns and interests not shared by retail employees, including working in an environment where the exposure to work related injury far exceeds the exposure to risk of in-store employees, being subject to random drug and alcohol testing, undertaking an outdoor role, being subject to adherence with applicable road rules and working different patterns of working hours.

Neither the proposed agreement nor the existing arrangement makes provision for a driver specific WH&S committee. As a consequence, driver WH&S concerns are not being auctioned as the majority of membership of the WH&S committees are in-store workers with little understanding of and/or interest in transport industry issues. The safety concerns advanced by the Transport Workers’ Union, evidenced by industry fatality rates that are ten times the national average of all industries, are not addressed in the proposed agreement.

Drivers performing online delivery work represent approximately 2% or less of the total number of employees Coles seeks to cover under the proposed Store Team Enterprise Agreement 2014. The remaining majority of employees, being in-store workers, have little regard or understanding of transport industry considerations. As a consequence, employees performing online delivery work will be denied the opportunity to meaningfully participate in bargaining given they can be easily outvoted by store employees.

The log of fifty claims filed by the Transport Workers’ Union on behalf of its members for the proposed agreement has been rejected by Coles. Coles intends that the proposed ‘One Store Team Agreement’ will apply to online drivers and has rejected the inclusion of any transport specific provisions into the proposed agreement. The effect is that the Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited Retail Agreement 2011, that Coles had expressly stated did not apply to drivers, is being re-named and intended to apply to drivers.

The making of an order will promote fair and efficient bargaining by permitting negotiation of an agreement that will specifically cater for the needs, interests and circumstances of online delivery drivers employed by Coles which is not possible in the context of the bargaining for the proposed Store Team Enterprise Agreement 2014.

The bulk of employees to be covered by the proposed Store Team Enterprise Agreement 2014 are represented by the Shop, Distributive and Allied Employees’ Association. Members of the Transport Workers’ Union and other persons employed as online delivery drivers to undertake the delivery of goods ordered through the Coles Online website strongly support the negotiation of a separate agreement to apply to that class of employees.

The Applicant contends that the proposed agreement should cover the following employees:

The Transport Workers’ Union seeks that the Commission order that there be two proposed enterprise agreements. The scope of the first proposed agreement should cover the employees covered by the existing Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited Retail Agreement 2011 and should specifically exclude Customer Service Agents performing driving and delivery by road of goods ordered online.

The second of the proposed agreements should cover all Customer Service Agents employed by Coles Supermarkets Australia Pty Ltd to perform driving and delivery by road of goods ordered through the Coles Online website.”

[3] The Respondents were served with a notice pursuant to s.238(3) of the Act. The application first came before me on 18 September 2014 by way of a videoconference. Subsequent proceedings took place in Sydney on 2, 3, 11 December 2014; 29, 30 January 2015 and 4, 16 February 2015.

Legislative Framework

[4] Section 238 of the Act provides:

“238 Scope orders

Bargaining representatives may apply for scope orders

(1) A bargaining representative for a proposed single-enterprise agreement may apply to FWC for an order (a scope order) under this section if:

(a) the bargaining representative has concerns that bargaining for the agreement is not proceeding efficiently or fairly; and

(b) the reason for this is that the bargaining representative considers that the agreement will not cover appropriate employees, or will cover employees that it is not appropriate for the agreement to cover.

No scope order if a single interest employer authorisation is in operation

(2) Despite subsection (1), the bargaining representative must not apply for the scope order if a single interest employer authorisation is in operation in relation to the agreement.

Bargaining representative must have given notice of concerns

(3) The bargaining representative may only apply for the scope order if the bargaining representative:

(a) has given a written notice setting out the concerns referred to in subsection (1) to the relevant bargaining representatives for the agreement; and

(b) has given the relevant bargaining representatives a reasonable time within which to respond to those concerns; and

(c) considers that the relevant bargaining representatives have not responded appropriately.

When FWC may make scope order

(4) FWC may make the scope order if FWC is satisfied:

(a) that the bargaining representative who made the application has met, or is meeting, the good faith bargaining requirements; and

(b) that making the order will promote the fair and efficient conduct of bargaining; and

(c) that the group of employees who will be covered by the agreement proposed to be specified in the scope order was fairly chosen; and

(d) it is reasonable in all the circumstances to make the order.

Matters which FWC must take into account

(4A) If the agreement proposed to be specified in the scope order will not cover all of the employees of the employer or employers covered by the agreement, FWC must, in deciding for the purposes of paragraph (4)(c) whether the group of employees who will be covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.

Scope order must specify employer and employees to be covered

(5) The scope order must specify, in relation to a proposed single-enterprise agreement:

(a) the employer, or employers, that will be covered by the agreement; and

(b) the employees who will be covered by the agreement.

Scope order must be in accordance with this section etc.

(6) The scope order:

(a) must be in accordance with this section; and

(b) may relate to more than one proposed single-enterprise agreement.

Orders etc. that FWC may make

(7) If FWC makes the scope order, FWC may also:

(a) amend any existing bargaining orders; and

(b) make or vary such other orders (such as protected action ballot orders), determinations or other instruments made by FWC, or take such other actions, as FWC considers appropriate.’

Background

[5] Coles Supermarkets Australia Pty Ltd (Coles) employs some 80,000 non-salaried employees in about 760 Coles and Bi-Lo branded stores. The wages and conditions of those employees are governed by the Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited Retail Agreement 2011 (the 2011 Retail Agreement). That agreement has passed its nominal expiry date but remains in force. The underpinning award for the 2011 Retail Agreement is the General Retail Industry Award 2010 (the Retail Award). The TWU is not a party to either the 2011 Retail Agreement or the Retail Award.

[6] Around 1999, Coles developed its current Online Department, known as Coles Online. This is a web-based service whereby customers log in via the internet to order supermarket products, orders are then routed to a store with an Online Department on a geographic basis and employees in the Online Department of that store then select the appropriate goods, consolidate those goods into individual orders, load the goods into vans and the goods are then delivered to both individual customers’ homes and to a variety of business customers.

[7] Coles Online employs a total of some 3300 ‘Team Members’ with about 88 stores having an Online Department. Coles Online employees are divided into two groups, the Customer Service Agents (CSAs) and the Personal Shoppers. In total there are some 1260 CSAs, of whom around 400 (or 32%) are members of the SDA and around 116 (or 9%) are members of the TWU.

[8] Prior to 2010, distribution was first undertaken under contract with Australia Post and later the delivery service was contracted out to various transport companies such as Linfox. During the period when outside transport companies were performing deliveries for Coles, the persons driving those vehicles were covered by enterprise agreements negotiated by the TWU and their wages and conditions were based upon transport awards. Coles was not a party to any of those instruments.

[9] In 2010, Coles took a business decision to take over delivery of supermarket goods using a fleet of Coles-branded 4.495 gross tonne vehicle mass rigid automatic vans driven by CSAs directly employed by Coles. There is no dispute as to the TWU’s right to enrol CSAs whose primary job is delivery of goods by road. In August 2011, the TWU and the SDA reached a demarcation agreement relating to the enrolling of CSAs as members of each union.

[10] When the 2011 Retail Agreement was negotiated and approved, the agreement did not include a specific CSA classification. In this regard, Coles, the SDA and the TWU agreed that there would be negotiations for a separate agreement to apply to the CSAs. Negotiations for a CSA agreement continued into 2012 but then reached an impasse over whether the Retail Award as advocated by Coles or the Road Transport and Distribution Award 2010 (the Transport Award) as advocated by the TWU, would underpin any separate CSA agreement.

[11] The dispute between Coles and the TWU over the applicable modern award involved considerable litigation within this Commission, the Federal Circuit Court of Australia and ultimately the Federal Court of Australia.

[12] On 28 February 2014, Driver J of the FCCA published his decision in Transport Workers’ Union of Australia v Coles Supermarkets Australia Pty Ltd 1 (the FCCA decision). In that decision, his Honour, after an exhaustive examination of the facts, decided that:

“a) the Road Transport Award cannot cover Coles (and hence cannot cover CSAs); and


b) even if the Road Transport Award could cover CSAs, the Retail Employee Level 1(or higher) classification is the more appropriate classification for CSAs for the purposes of clause 4.7 of the Retail Award (and hence the Road Transport Award could not apply to CSAs).” 2

[13] The TWU appealed to the Federal Court against Driver J’s decision and a Full Court handed down its decision on 3 November 2014 3 (the Federal Court Decision). The Full Court dismissed the TWU appeal and thereby upheld Driver J’s conclusion that the Retail Employee Level 1 classification in the Retail Award is the most appropriate classification to cover CSAs. The Federal Court Decision was published prior to the first hearing before me.

[14] The TWU has now applied for a scope order to enable it to bargain with Coles for a separate agreement to cover CSAs. The TWU now accepts that the Retail Award is the applicable instrument for such purposes as the Better Off Overall Test (BOOT). Currently, Coles is voluntarily applying the terms of the 2011 Retail Agreement to CSAs, classifying them as Retail Employees. However, the TWU still maintains that the Road Transport Award is the appropriate reference point for the wages and conditions of CSAs.

Evidence

Witnesses for the TWU

Mr M Kaine

[15] Mr Kaine gave sworn evidence and adopted a witness statement 4. He is the Assistant National Secretary of the TWU and his statement is in the form of a reply to the evidence of Coles and SDA witnesses.

[16] In response to Ms Murphy’s evidence that Coles will maintain its position that the Transport Award is not an appropriate base to negotiate terms and conditions for CSAs, he says:

“TWU emphasis in negotiations on the terms and conditions of the Transport Award emanates from two sources. First, the desire as an industrial organisation that has represented the interests of transport drivers for 130 years to ensure that fair and safe driver terms and conditions - as set out as minima in the Award - apply to Coles Online drivers whose work overwhelmingly, on a proportional basis, mirrors that of other road transport drivers. Secondly, the need to overcome the refusal of the Coles negotiating team to provide any reason in substance to its rejection of those terms and conditions.”

[17] Mr Kaine asserts that Coles has been inflexible in dealing with the TWU during agreement negotiations:

“In contrast the TWU and drivers have made clear a willingness to explore the prospect of being part of the retail agreement if appropriate terms and conditions applied. It was not the TWU that brought to the negotiations a closed mind. The comment above, and others outline in Ms. Murphy’s statement demonstrates that Coles had predetermined its position and would not move at all from it.”

[18] In response to the evidence of Mr Lord, he says that the position of the TWU in agreement negotiations has consistently been that it is necessary to focus on terms and conditions “that would most appropriately apply to workers whose clear principal function is driving. It is nothing but logical for the TWU to bargain for provisions the substance of which have been expressly formulated to apply to drivers.” He goes on to say that the TWU did not insist that its agreement was dependent upon the application of the Transport Award. “The difficulty with the current negotiations is that there is little willingness by Coles to discuss terms and conditions that are appropriate for CSA’s.”

[19] In response to the evidence of Mr de Bruyn, Mr Kaine deals with the demarcation agreement between the TWU and the SDA and asserts that the SDA has breached that agreement by opposing the scope order(s) sought and by supporting the inclusion of CSAs in the proposed new agreement. This particular part of Mr Kaine’s evidence has not played a role in my decision making.

Ms T Walton

[20] Ms Walton gave sworn evidence and adopted a witness statement 5. She is the National Industrial Officer/Negotiator for the TWU and in that role represents the National Office in negotiations for enterprise agreements. She was involved during 2011 and 2012 in negotiations for an enterprise agreement to cover CSAs, for which the TWU has industrial coverage. She is familiar with the work of CSAs through her direct observation, participation in enterprise agreement negotiations with Coles and participation in matters before the Commission and the Federal Circuit Court of Australia.

[21] “To the best of my knowledge and belief, the primary function performed by CSAs is the driving of delivery trucks for the purpose of carrying and delivering goods ordered through the Coles Online website to domestic and commercial premises. The drivers also perform additional duties included but not limited to:

(a) Obtain paperwork for days deliveries;

(b) Move customer orders from Online Room to staging area and add refrigerated items to orders;

(c) Collect vehicle from parking area and perform pre-trip check;

(d) Load trucks (include bulk and frozen items and trolley);

(e) Remove truck from loading bay to waiting area to clear dock for waiting trucks;

(f) Check paperwork and get deliveries in order prior to scheduled departure time;

(g) Check for any order discrepancies;

(h) Drive a rigid vehicle not exceeding 4.5 tonnes gross vehicle mass (GVM) to perform deliveries of goods ordered online;

(i) Collect payments when required;

(j) Check customer identification for tobacco and alcohol deliveries when necessary;

(k) After completing deliveries, refuel truck and return to depot;

(I) Unload empty crates, esky and trolley;

(m) Return ice packs to freezer;

(n) Place returned orders into cool room;

(o) Return EFTPOS and GPS devices to chargers;

(p) Return delivery books and vehicle keys.

[22] Ms Walton went on to say that the position of CSA “was created as a result of Coles’ decision in 2010 to ‘in-source’ the Coles Online delivery work.” Prior to that date, the delivery functions were outsourced to companies such as Linfox. Ms Walton goes on to say that CSAs were intentionally excluded from the 2011 supermarket agreement. Coles sent correspondence to CSAs to that effect and informing them that it proposed to negotiate a separate agreement for them. The statement continues with material relating to the 2011 - 2012 negotiations for a new supermarket agreement. During those negotiations, the TWU maintained that the Road Transport and Distribution Award 2010 was the relevant award when considering wages and conditions for CSAs. That position was not accepted by Coles and led to litigation. The details of the results of that litigation are set out elsewhere in this decision.

[23] In 2014, Coles advised the TWU that it intended to commence re-negotiation of the Supermarkets Agreement and had decided that any new agreement would apply to CSAs as well. The TWU submitted a log of claims and she attended some 16 meetings: “Despite having attended 16 meetings, there has been relatively little time dedicated to discussion of the TWU’s claims. The negotiations are not proceeding efficiently and the short amount of time spent dealing with the TWU’s claims has not warranted the time, resources and expense of having our negotiating team in attendance. Coles has rejected or refused to discuss all of the TWU’s claims. Coles refuses to adopt any claims based on transport industry standards and insists the agreement will be based on a retail platform. Many of the TWU claims have been rejected because Coles is comfortable with the existing clauses in the supermarkets agreement and will not make changes. The TWU has had no involvement with the development of the supermarkets agreement over its 28 year history. The 2008 supermarkets agreement was negotiated and approved by FWC prior to Coles’ decision to in-source the transport operation.”

[24] The TWU does not accept the classification of CSA proposed by Coles and “has also advocated for the inclusion of driver-specific OH&S considerations in an enterprise agreement applying to drivers.” The TWU has also been pressing for the provision of protective gloves, wet weather gear and safety boots. Coles has rejected those claims, though the provision of gloves is a possibility.

[25] The negotiation process for a new supermarket agreement has been difficult because of the number of representatives in attendance and the disparity of issues under consideration. This has also led to inefficiency.

[26] “The TWU has sought the views of CSAs with respect to having a stand-alone agreement covering the work they perform. We have received 186 individual responses in support of a separate agreement for CSA drivers.”

[27] Ms Walton goes on to submit that CSAs are operationally distinct and they report through an Online Department Manager, which is distinct from the supermarket operations and they have little interaction with other members of staff in the retail store to which they are attached.

[28] “The online delivery drivers have concerns and interests not shared by retail employees, including working in an environment where the exposure to work related injury far exceeds the exposure to risk of in-store employees, being subject to random drug and alcohol testing, undertaking an outdoor role, being subject to adherence with applicable road rules and working different patterns of working hours.”

[29] “Drivers performing online delivery work represent approximately 2% or less of the total number of employees Coles seeks to cover under the proposed Store Team Enterprise Agreement 2014. The remaining majority of employees, being in-store workers, have little regard or understanding of transport industry considerations. As a consequence, employees performing online delivery work will be denied the opportunity to meaningfully participate in bargaining given they can be easily outvoted by store employees.”

[30] Ms Walton also adopted a Statement in Reply 6. In that statement, Ms Walton deals extensively with a reply to the evidence of Ms Murphy in relation to the progress of enterprise agreement negotiations and in reply to other Coles witnesses. I have paid regard to that material as far as it is relevant to my consideration.

Ms Ciccia

[31] Ms Ciccia gave sworn evidence and adopted a witness statement 7. Ms Ciccia is a CSA employed in the Online Department at Coles Narellan store in New South Wales. She previously worked at Casula under Ms Guest. She is a member and delegate of the TWU.

[32] Her statement goes on with details of her working hours and training. She says that she has only performed some ten picking shifts over the past three years. She is not aware of any of her supervisors or managers having transport experience and it is necessary for her to independently handle any problems with the vehicle she is allocated.

[33] Ms Ciccia’s statement then deals with on the job injuries and in that regard is similar to that of Mr Koomen. In relation to safety, Ms Ciccia says that CSAs are not represented on the OH&S Committee and the concerns of drivers are not often addressed. As to Personal Protective Equipment (PPE), her evidence is in line with that of Mr Koomen.

[34] Ms Ciccia goes on to say in relation to enterprise agreement negotiations: “There is nothing in the agreement for us, it is like we do not exist and they do not recognise us as drivers. They don’t even use the word driver. I feel like our concerns are not being recognised and our voice is lost among the larger number of in store employees.”

[35] “I consider myself a transport worker and feel that I am working in an environment which is totally disconnected from and foreign to in-store retail workers.”

[36] Ms Ciccia also adopted a Statement in Reply 8. Her further statement deals with the evidence of Ms Guest and says that CSAs rarely attend team meetings and that she is only rarely involved in picking for the Online Department.

Mr J Garsia

[37] Mr Garsia gave sworn evidence and adopted a witness statement 9. He is a delivery driver (CSA) attached to the Online Department at Coles Endeavour Hills Store in Victoria. He is a permanent part-time employee and a member of the TWU.

[38] Mr Garsia’s statement goes on to set out his working arrangements and schedule. He says that the majority of his shift hours are spent away from the store. Mr Garsia then sets out the details of his daily duties and I have paid regard to that material.

[39] Mr Garsia also says that he believes that drivers require safety boots instead of the current standard uniform requirement of black dress shoes. He also believes that gloves should be supplied as a necessary part of the job.

[40] Mr Garsia’s statement continues with the view that the safety issues faced by CSAs are very different to those faced by in-store employees. He says that vehicle safety is a further matter of concern to him and that Coles does not address such issues adequately.

[41] Mr Garsia says that rates of pay for drivers outside Coles are higher. He then moves on to the enterprise agreement negotiations and says that in current negotiations [as of November 2014]: “Coles would like the supermarkets agreements to apply to us. The retail agreements do not reflect the work we do. I do not believe Coles is really listening to our concerns about the lack of consultation with drivers, about appropriate footwear and about appropriate recognition for what we actually do. “Because we are a minority group within Coles, we feel as though our interests will not be properly protected under the ‘one-store’ agreement. Our requests and suggestions will be white washed and outvoted by other employees.”

[42] Mr Garsia also adopted a Statement in Reply 10. That statement deals with parts of the evidence of Mr Lord, Ms Bourke and Mr Dixon. I have paid relevant regard to that material.

Mr S Koomen

[43] Mr Koomen gave sworn evidence and adopted a witness statement 11. He is employed as a driver (CSA) in the Online Department at Coles Vermont South store in Victoria. He is a member of the TWU.

[44] Mr Koomen says that the hours worked by CSAs “are very different to in-store employees, because the amount of work/deliveries each day changes. Our rostered hours rarely match the hours worked because we can only finish work once we finish our deliveries and return to the store. An in-store employee has the choice to finish work at the rostered time if they have a prior appointment in the afternoon. If I have an appointment in the afternoon I can’t just leave at my rosterd finish time because I need to complete my deliveries before I finish. This happens often for me, where I have had to cancel or reschedule another commitment because I have to work past my rostered time.”

[45] In relation to training, Mr Koomen says that the current position is that new drivers are trained by existing drivers and occurs on the job. Mr Koomen goes on to deal with his daily duties, which evidence is in line with that generally from the TWU. He says that he does not regularly do picking and packing and this occurs on average of “a couple of hours a month”.

[46] His statement continues with information as to injuries which have occurred to CSAs and safety matters. He draws attention to the “diverse range of terrain each day” and there is no “reconnaissance of the delivery site before [Coles] accept new clients.”

[47] Accordingly to Mr Koomen, Coles does not supply PPE and he believes that CSAs should be supplied with gloves, steel capped boots and winter jackets. The shoes currently supplied are not suited to home deliveries. Mr Koomen then turns to driver turnover and pay rates, saying that there is a large turnover of CSAs at his store, this arises from the lack of full time work opportunities and that CSAs are paid the same rate as in-store workers. In relation to ‘driver pressures’ Mr Koomen says that there is considerable pressure to complete a delivery schedule and this has caused him to miss his breaks. He was once warned by his Manager that if he failed to complete his deliveries again, he could be removed from driving duties and required to perform shopping work.

[48] Mr Koomen’s statement then deals with enterprise agreement negotiations between the TWU and Coles. In his view, those negotiations have mostly covered issues not relevant to CSAs and the size of the negotiating team “can be intimidating”. He refers to Coles’ wish that all employees at the store work under the same conditions and strongly disputes this.

[49] Mr Koomen also adopted a Statement in Reply 12. That statement deals with parts of the evidence of Coles witnesses. I have paid relevant regard to that material.

[50] In particular, Mr Koomen replies to elements of the evidence of Mr Dixon, Mr Scott and Mr Lord. He says that safety issues are not adequately addressed by Coles and says that he does not perform personal shopping tasks in the store and rarely observes other drivers performing such tasks. He goes on to say that “we should have a separate agreement because the work that we do is quite different to those of workers in store and our needs are different.”

Witnesses for Coles

Ms N Guest

[51] Ms Guest gave sworn evidence and adopted a witness statement 13. She is currently Online Department Manager at Coles Casula NSW Store. She manages 83 team members and is responsible for the day to day operations of her department. Ms Guest’s statement goes on to set out the training she received for her current role.

[52] She then deals with rostering at Casula and the daily duties of CSAs. Subsequent material in Ms Guest’s statement in relation to such issues as vehicle safety is consistent with other evidence from Coles witnesses.

[53] Ms Guest says that she believes that CSAs are an extension of the physical store. She promotes interaction and team work between store departments.

Mr M Scott

[54] Mr Scott gave sworn evidence and adopted a witness statement 14. He is the Manager of Coles Vermont South Victoria Store. In that role he is responsible for the day to day operations of the store and the Online Department Manager reports to him.

[55] Mr Scott’s statement goes on to set out the training he received specific to the Online Department and his supervision of, and interaction with, the CSAs based at Vermont South. He is available to CSAs if they need to approach him with any problems or questions. The statement goes on to deal with consultation and safety issues and in that regard was broadly comparable to the evidence of other Coles witnesses.

Mr P Dixon

[56] Mr Dixon gave sworn evidence and adopted a witness statement 15. He is the National Training and Compliance Manager - Coles Online.

[57] Mr Dixon’s statement goes on to set out his role within Coles and the importance Coles places on safety. The statement then deals with training for CSAs, including a driving assessment. The statement sets out details of the scheduling of deliveries using the Oracle Realtime Scheduling System. The statement deals with requirements to meet delivery times, the rostering of hours of work for CSAs and their supervision.

[58] Mr Dixon’s statement also contains reply material to that of Ms Ciccia, to which I have paid regard.

[59] Mr Dixon says that any problems with vehicles are directed to a dedicated telephone number which is operated by an external service provider. The statement continues with some details about how Coles handles difficulties during deliveries and the role of the telephone contact line (1800 MY COLES). In an emergency, drivers are required to telephone ‘000’ ‘in the first instance’. CSAs can raise any safety issues with their online manager or another manager on duty and/or a store manager.

[60] Mr Dixon’s statement also includes details of the safety record of the Online Department. I have paid regard to that material but will not refer further to it here as it has been agreed that such details will be kept confidential.

Ms L Murphy

[61] Ms Murphy gave sworn evidence and adopted a witness statement 16. She is Employee Relations Manager - Retail, Human Resources for Coles.

[62] She was a negotiator for Coles in the making of the 2011 Agreement. She is also part of the bargaining process for a new supermarket team agreement [as at November 2014].

[63] Ms Murphy’s statement goes on to set out the Coles store structure and I have paid regard to that material. The statement continues at considerable length to discuss Coles plans and actions aimed at improving its service to customers. The making of a single agreement for all store employees “will provide a simple and flexible enterprise agreement to cover all weekly wage team members across the Coles and Bi-Lo branded stores and will promote the ‘one store, one team’ message to encourage all Store Team Members and CSAs to work effectively together to deliver the best customer experience (which is Coles’ ultimate business objective and consistent with its overarching commercial strategy). Importantly, the Store Team Agreement will harmonise terms and conditions of employment, which is important for CSAs who are treated as being covered by the Retail Agreement despite the fact that they are not in fact covered by it. This will improve administrative inefficiencies for Coles.”

[64] Ms Murphy says that the Online function is integrated into other store operations and coverage by a One Store Agreement “is a natural extension of this working alignment”.

[65] Ms Murphy’s statement continues with the detail of bargaining meetings held between April and November 2014. She states that the TWU has consistently maintained that the Road Transport Award should be the source of wages and conditions for CSAs.

[66] Ms Murphy goes on to state that: “Whether it is a Store Team Agreement or a national retail agreement plus a separate CSA agreement, Coles will continue to press, in relation to CSAs, for the changes it has sought in the bargaining process for the Store Team Agreement. In particular, notwithstanding any scope order, Coles will continue to maintain its position that the terms and conditions in the Transport Award are not an appropriate base to negotiate terms and conditions applicable to CSAs working in supermarkets.”

[67] In response to Mr Lord’s evidence, Ms Murphy says that “the vast bulk of the matters that were being pressed by the TWU in 2011 are still being agitated by the TWU in the current negotiations for the Store Team Agreement.” The statement also responds to the evidence of Ms Walton and asserts that “the TWU has had ample opportunity to ventilate their issues and put forward their position.”

[68] “Coles’ view is that the TWU’s reliance on broad transport industry standards and statistics is misplaced as it ignores the realities of the Online retail operation. Coles does not perceive there to be a distinction between CSAs and other Store Team Members and because of this, I am of the view that the interests and concerns of CSAs can (and are) being appropriately considered and accommodated during bargaining discussions. I also do not agree with Ms Walton that Coles has rejected or refused to discuss all of the TWU’s claims. ... Coles has spent considerable time discussing the TWU’s claims, and has given explanations for the reasoning behind its responses and in relation to its own claims.”

Ms B Bourke

[69] Ms Bourke gave sworn evidence and adopted a witness statement 17. She is the Online Department Manager at Coles Endeavour Hills Victoria Store. She manages approximately 60 Online Department team members and has completed the training which is provided to CSAs on their commencement. Ms Bourke sets out her role at the store and the operations of the Online Department in general at that store.

[70] She replies to the evidence of Mr Garsia and says that while she has no specific experience in the transport industry, this is not necessary as her role mainly consists of people management, customer service and other administrative processes. She goes on to deal with the role of 1800 MY COLES, which I have dealt with elsewhere in summaries of evidence.

[71] Ms Bourke’s statement continues with details of rostering arrangements in the Online Department of her store, consultation arrangements with staff and safety policies. I have paid regard to that material.

[72] In further reply to the evidence of Mr Garsia, Ms Bourke says that the Online Department is not external or separate to other sections of the store and that CSAs who wish to work additional hours have been given additional shifts in the store working in such areas as the deli and grocery departments.

Mr C Gardner

[73] A witness statement from Mr Gardner was tendered 18. Mr Gardner was not required for cross-examination. Mr Gardner is a Partner of Seyfarth Shaw Australia, solicitors for Coles.

[74] In his statement Mr Gardner gives a history of negotiations and litigation between the TWU and Coles. I have paid regard to that material which is not controversial as to its factual content.

Mr M Lord

[75] Mr Lord gave sworn evidence and adopted a witness statement 19. He is the Head of Operations - Coles Online and is responsible for managing the operations of Coles Online. The Online business employs approximately 3,100 persons, of whom about a third are CSAs.

[76] Mr Lord’s evidence goes on to set out how Coles Online operates and how orders are received and processed. Some 88 Coles stores now have an Online Department and that Department “is simply another department within a Coles Supermarket that services online customers.” Customers can choose to have their goods delivered by vehicle or arrange to pick up their order in a nominated store. Mr Lord’s evidence goes on to set out his view of the role of a CSA, including consolidation of orders and delivery of them. I have paid regard to the detail of that material.

[77] “The Coles Online business is an integral part of the Coles stores within which it operates. As noted above, Online Department Team Members select items from the shelves at each store and perform a range of general in store tasks.” Mr Lord says that the role of a CSA is customer service oriented and they are not recruited primarily on the basis of their driving capability as “they are the face of Coles at the customers’ premises.”

[78] Mr Lord goes on to deal with enterprise bargaining during 2014 and his evidence in that regard is consistent with that of Ms Murphy. He concludes his statement with a response to the evidence of Ms Walton and Ms Ciccia but there was nothing in that response which would have any impact on my decision making.

Witnesses for the SDA

Mr J de Bruyn

[79] Mr de Bruyn gave sworn evidence and adopted a witness statement 20.

[80] Mr de Bruyn is the National President of the SDA and led negotiations with Coles for the making of the 2011 Retail Agreement. As part of the 2011 Agreement, the SDA agreed with Coles that CSAs would not be covered by that Agreement: “Instead, we would negotiate a new and separate agreement for such employees with the involvement of the Transport Workers Union (TWU).” This was done so as not to delay the making of a new agreement for supermarket employees as the previous agreement had expired.

[81] Mr de Bruyn went on to say that after agreement negotiations were concluded, a demarcation agreement was made between the SDA and the TWU in August 2011. He then organised the beginning of negotiations between the TWU, the SDA and Coles to conclude the new Agreement to cover CSAs. There followed some eight bargaining meetings between September 2011 and March 2012.

[82] “By the end of March 2012, it was clear to me that no Agreement could be negotiated. I believed that this was due to the irreconcilable views of Coles and the TWU over: -

(a) Which modern award was the appropriate under-pinning instrument for the work of Customer Service Agents employed at Coles Supermarkets (The General Retail Industry Award of the Road Transport and Distribution Award); and

(b) What would be acceptable rates of pay and conditions of employment for Customer Service Agents.”

[83] Mr de Bruyn went on to say that it was his view that an acceptable agreement could be concluded with Coles providing for a higher rate of pay for CSAs with some particular appropriate conditions of employment. The basic framework of any such agreement would be the 2011 Retail Agreement.

[84] He went on to say that:

“The SDA was disappointed that no new Agreement for Customer Service Agents was concluded because: -

(a) It left Customer Service Agents in limbo with no clear understanding whether they were covered by a modern award or by the Coles Agreement that had expired in February.

(b) It ultimately left Customer Service Agents on the same rate of pay as Coles Team Members indefinitely despite a clear indication that Coles was prepared to pay them more.”

[85] The SDA now supports Coles in including CSAs in a new agreement for supermarket employees. Negotiations for such an agreement were in progress [as at November 2014]. The number of CSAs enrolled by the SDA is greater than those enrolled by the TWU.

Mr G Paton

[86] Mr Paton gave sworn evidence and adopted a witness statement 21. He is a CSA employed by Coles in Queanbeyan, NSW. Mr Paton is a member and delegate of the SDA.

[87] Mr Paton went on to say that his role as a CSA involves the picking and delivering of products to Coles customers. He works an early morning shift and starts at the store consolidating items for delivery, scanning them and loading them into a delivery vehicle. Other CSAs at Queanbeyan do similar work but some drivers do a larger number of deliveries. When he first commenced work for Coles, he was trained by a Coles Trainer from Sydney and this included a store induction. Recently, due to a shortage of drivers, he has been doing very little picking but other CSAs at Queanbeyan do.

[88] Mr Paton went on to say that casual CSAs in his store generally perform a mixture of driving and picking. As an SDA delegate, he feels that he has “a good understanding of what goes on in my store.” He believes that the work and training of CSAs in other Coles stores is similar to that of Queanbeyan.

[89] “I see myself as working in the retail industry. I do not just drive a van. I enter the customer’s house and I assist in unpacking the products. I am equipped with an EFTPOS machine and I complete transactions with the customer. I see the Online department as one of many departments within the store. I consider myself as a supermarket employee with a role that involves driving.”

Mr M Galbraith

[90] Mr Galbraith gave sworn evidence and adopted a witness statement 22. He is an industrial officer in the SDA National Office.

[91] Mr Galbraith’s evidence concerning negotiations during 2011 and 2012 for a proposed separate agreement for CSAs was consistent with that of Mr de Bruyn, whom he assisted in those negotiations. Those negotiations failed and the TWU then commenced legal action over the question of the appropriate underpinning award for CSAs. He said: “I do not see how the making of a scope order in the terms sought will facilitate bargaining for an enterprise agreement. I would see the SDA, TWU and Coles in similar position as in 2011 and 2012 and from my experience expect that those negotiations may again fail.”

[92] Mr Galbraith is currently [as at November 2014] involved in negotiations for a proposed Coles Supermarket Agreement to replace the 2011 Agreement. As at November 2014 there had been 21 negotiation meetings for the proposed new agreement, with a further meeting scheduled. All the meetings have included representatives of the SDA, the AMIEU, the AWU and the TWU. Mr Galbraith’s evidence goes on to detail events at the negotiation meetings and I have paid regard to that material.

[93] Mr Galbraith also gave evidence in reply to the statement of Ms Walton. He states that during negotiations, the TWU “raised the possibility of considering an annexure to the one-store agreement.” He went on to say that if a scope order is issued then he would expect agreement negotiations would have to recommence from or near the beginning and the work that has been done during the many negotiation meetings could be wasted and that this would be very inefficient. Also, should a scope order be issued, “it would also mean that the possibility of two sets of negotiations going on at the same time (with all but one of the same parties). This would almost double the required resources of the SDA and other unions and would not be fair or efficient.”

Witness oral evidence, cross-examination and re-examination

[94] I have carefully considered the additional oral evidence, cross-examination and re-examination of all witnesses. I will not detail that material here but my overall view is that all witnesses maintained their evidence under cross-examination, with some concessions. Those concessions were not such as to be determinative in my decision making.

Written submissions

The TWU

[95] The TWU, per Mr Gibian, tendered “Consolidated Final Submissions for the TWU” 23 and spoke to those submissions at the hearing held on 16 February 2015. Those submissions are an extensive expansion on those contained in the grounds in support of the application set out earlier in this decision and incorporate the TWU’s earlier outline of submissions, filed in accordance with the Directions.

[96] The submissions argue that the major functions of the CSA role can be summarised as follows:

“(a) The CSA reports to work at the relevant store and receives a physical manifest, or a digital equivalent, which effectively contains the orders to be delivered in a particular delivery run.

(b) The CSA locates his or her allocated truck and completes “pre-delivery tasks”, including the performance of a check on the safety aspects of the truck (a 4.5 tonne gross vehicle mass rigid truck).

(c) The CSA consolidates crates containing the ordered goods within the online area of the store and loads the crates onto the truck. The orders have already been loaded into crates and sealed by other staff.

(d) The CSA then leaves the store and commences undertaking deliveries to customers and engaging with them as required, including checking identification if the sales involve alcohol or tobacco products and completing sales using a mobile EFTPOS machine, if needed.

(e) The CSA’s role is solely to deliver the goods that have been ordered by the customer on the Coles Online website and is not able to sell any additional products to the customer at point of delivery.

(f) After completing a particular delivery, the emptied crate is returned to the truck and the CSA continues with the remaining deliveries until the allocated daily deliveries are completed.

(g) The CSA remains out on the road until all deliveries have been completed and then returns to the store, refueling the truck, unloading the empty crates, returning the keys, equipment and paperwork.”

[97] The TWU’s submissions go on to say that an ‘in-principle’ agreement was reached between Coles and the SDA on 1 December 2014 for the making of an agreement to replace the 2011 Agreement. Neither the terms of the Agreement nor advice that such an agreement had been reached were communicated to the TWU. The TWU “has concerns that bargaining for the proposed new Store Team Enterprise Agreement 2014 is not proceeding efficiently or fairly because of the coverage of in-store employees together with CSAs undertaking transport work.” [reference omitted]

[98] The submissions deal in some detail with whether the TWU participated in good faith bargaining. As that issue is not in contest, I will not deal with that material in this decision except to say that on examination of the information before me, the TWU bargained with Coles in good faith. No inferences in evidence etc. to the contrary have played any role in my decision making.

[99] The TWU argues in relation to s.238(4)(b) of the Act that “the intent of the Act is that employees have the opportunity to meaningfully participate in bargaining for the making of an enterprise agreement setting conditions of employment applying to their employment.”

[100] “The denial of an effective opportunity to bargain undermines collective bargaining and the objects of the Act. The approach of Coles to the bargaining to date has rendered CSAs without an effective voice in the bargaining because they can be simply drowned out by the large number of shop employees and has prevented any genuine consideration of appropriate conditions to apply to those employees. That result undermines collective bargaining and the objects, purpose and scheme of the Act. The fairness of the bargaining process will be enhanced by the making of a scope order that permits CSAs to meaningfully participate in bargaining.”

[101] The TWU argues: “that Coles is seeking to include within the coverage of its main retail agreement a group of employees who have never been covered by the predecessor instruments and who perform a different type of work to employees based solely within the store. Particularly in those circumstances, a fair bargaining process must ensure that the employees to be newly included in the agreement are given the opportunity to have a meaningful influence upon the bargaining process and negotiation appropriate conditions for that type of work. The CSAs performing online delivery work represent 2% or less of the total number of employees Coles seeks to cover under the proposed Store Team Enterprise Agreement 2014. The information provided by Coles is that there are currently approximately 1,259 persons employed as CSAs and almost 80,000 employees otherwise covered by the proposed agreement working solely within retail supermarkets. The interests of employees performing online delivery work are neglected in the context of the broader bargaining and those employees are denied the opportunity to meaningfully participate in bargaining given they can be easily outvoted by store employees.”

[102] The TWU submits that no consideration was given by Coles “to the particular needs and interests of CSA employees.” Coles simply rejected all TWU claims and would not agree to any variation to its proposed agreement. “Coles simply rejected, out of hand and without explanation, any deviation from the terms of the 2011 Retail Agreement.” It is alleged by the TWU that Coles took the above approach in the knowledge that CSAs “could have no impact upon the approval of the agreement”. This knowledge had led Coles to believe that there is no need to make any concession in relation to CSAs.

[103] The relative numbers of CSAs when compared with the total number of employees under the Retail Agreement means that the current bargaining regime “stand[s] in the way of progress being made and prevent[s] the needs and interests of CSAs being given genuine consideration. Bargaining for an agreement to specifically apply to CSAs will permit appropriate attention being directed at the conditions of CSAs and provide incentive for the parties to concentrate on those issues in order to reach agreement. The making of the scope order sought will thereby improve the fairness of the bargaining process.

[104] “CSAs represent a distinct group of employees whose needs, interests and circumstances diverge from those of in-store employees arising from the distinctive nature of the work performed, the environment in which work is undertaken and a differing industrial history. … The primary function of CSAs is to undertake the driving and delivery function for Coles Online, which is unlike the work of any other employees to be covered by the proposed retail agreement. CSA employees perform the bulk of their work driving a truck on public roads making deliveries as well as the associated tasks of conducting pre-departure checks, consolidating orders and loading orders onto the trucks. CSAs are, unlike any supermarket employees, away from the store and any direct supervision and are not involved in service of customers in the store or sale of goods.”

[105] The submissions go on to set out in some detail the “distinct industrial interests and needs” of CSAs and I have paid regard to that material.

[106] “The efficiency of the bargaining process will be enhanced by confined negotiations that are able to focus specifically upon the issues relating to CSAs. Such an approach would not involve duplication of bargaining. To the contrary, the efficiency of the bargaining process for CSAs and for store retail employees is likely to be enhanced by separating those groups of employees. There is also no reason to believe, as suggested by the SDA, that the bargaining will have to recommence at the beginning. There is no reason to think the parties will forget or disregard such discussions as have occurred to date in relation to CSAs.”

[107] The submissions go on to deal with the ‘fairly chosen’ question. The TWU argues that: “In applying s 238(4)(c), it must be remembered that the Commission is not required to determine that the coverage proposed by Coles is not fairly chosen. Although there are grounds upon which the Commission might form that view, it is not necessary to do so. The only finding required to be made is that the group to be covered under the proposed scope order would be fairly chosen. There may be more than one way of fairly choosing the group of employees to be covered by an agreement. The Commission is not required to assess what it might consider to be the preferable grouping to cover covered by an agreement.”

[108] The TWU goes on to say that in 2011/2012 Coles decided to negotiate a separate agreement to apply only to CSAs and thus to exclude those employees from the agreement covering work within the physical Coles stores. Such action by Coles indicates that it considers a separate agreement to cover CSAs as involving a ‘fairly chosen’ group. Now, when pressed by the TWU, Coles argues that the same group of employees is not ‘fairly chosen’. This should invite scepticism from the Commission. The submissions go on at some length to discuss the alleged operational and/or organisationally distinct role of CSAs in the following terms:

“(a) Coles has itself established a distinct classification for CSAs with a separate job description relating to the particular duties of that role emphasising that the primary function of the position is to ‘provide an outstanding home delivery service to all customers’. The driving and delivery function undertaken by CSAs is distinct in its nature, location and demands from work undertaken by staff facilitating the sale of goods to customers attending a retail store.

(b) The Online Department in a store is distinct organisationally from operations within the store. The Online Department is supervised by the Online Manager who only has responsibilities with respect to online employees and not any other employees within the store. Coles Online also has a head office headed by Mr Lord with specific responsibility for the operation of the Coles Online business. Coles Online is clearly a distinct aspect of Coles’ business.

(c) CSAs spend the majority of their working time either loading pre-packaged goods onto their truck in the Online Department and on the road driving and making deliveries rather than within a store. The tasks undertaken and skills required differ from those of in-store employees, are undertaken in a different environment and present distinct health and safety considerations and distinct issues in terms of hours of work and pay. CSAs have limited capacity to interact with staff working within the retail store.

(d) In order to undertake work as a CSA, employees are required to undertake specific training and possess particular skills, including being a competent and safe driver. The training provided to CSAs is predominantly devoted to skills necessary to perform that role. Four of the five day training program is specifically devoted to driving and delivery work. Coles cannot simply transfer an in-store employee to undertake CSA work without the necessary training and accreditation.

(e) Any other duties performed by CSAs are additional to and subsidiary to the primary function of driving and making deliveries. Reference is made in Coles’ evidence to CSAs performing a picking shift. At its highest, it is said that 51% of CSAs perform one rostered shopping shift per week. Even where one shopping shift is worked, that work usually amounts to no more than 4 hours per week.” [references omitted]

[109] The TWU submits that it is reasonable in all the circumstances for me to grant a scope order in the terms sought. The submissions in regard to that matter largely repeat earlier material which I have dealt with above. The TWU goes on to say that: “the question of the relevant award for the purposes of the application of the BOOT has now been resolved and there is nothing to prevent genuine negotiation.”

[110] The submissions close with details of the orders sought by the TWU: “In accordance with s 238 of the Fair Work Act 2009, it is ordered that those persons employed by Coles Supermarkets Australia Pty Ltd as Customer Service Agents to perform driving and delivery by road of goods ordered through the Coles Online website be allowed to bargain for a separate single enterprise agreement that will cover those employees.”

31. The primary judge was also correct to find that, if the Transport Award had covered the employment, the more appropriate classification was Retail Employee Level 1 under the Retail Award and not Transport Worker Grade 2 under the Transport Award, for the reasons which were given by the primary judge …” 31

[151] The Federal Court went on to say:

“34 When the primary judge turned to examine the question of whether Transport Worker Grade 2 or Retail Employee Level 1 was the more appropriate award classification his Honour was influenced by the fact that the latter classification appeared to be a more comprehensive match with the work of CSAs than the former. His Honour said:

‘229. As has already been discussed, the indicative tasks and job titles within the Retail Employee Level 1 classification specifically cover the tasks of a CSA. This degree of specificity supports the Retail Award as most appropriate. The fact that each CSA is a team member of a particular retail store and performs a range of tasks at their particular store provides a further important connection with the Retail Employee Level 1 classification. Even when undertaking delivery tasks, CSAs are involved in the consolidation of orders in the store with other team members and perform the customer service and transaction processing tasks which would ordinarily be performed by team members in the physical store. In short, the CSA role does not simply involve the collection and delivery of goods from a warehouse. …’

(Footnote omitted.)
and:

231. In light of the scope of clause B.1.1 of the Retail Award, all tasks performed by CSAs described earlier, including delivery driving tasks and van loading and unloading, fall within the Retail Employee Level 1 classification. This is because the Retail Employee Level 1 classification encompasses both “delivery of goods” and “packing of goods for despatch and despatch of goods”.

232. By contrast, delivery driving tasks are the only aspect of the CSA role that could fall under the Transport Worker Grade 2 classification. The Road Transport Award merely describes that classification as Transport Worker Grade 2 – Driver of a rigid vehicle (including a motorcycle) not exceeding 4.5 tonnes gross vehicle mass. No detail is provided around the types of tasks associated with that classification. Moreover, the indicative job title (Driver) covers only one component of the wide range of tasks performed by CSAs. This component is in any event covered equally by the Retail Employee Level 1 classification within the Retail Award as described above.
(Footnote omitted.) (Emphasis in original.)

35 We are unable to fault this approach. It appears to us that the primary judge applied himself diligently to the comparison and evaluation which was required. On the facts found by the primary judge we would reach the same conclusion.

36 The related conclusions that the Retail Award applied to the employment, and that the classification of Retail Employee Level 1 was a more appropriate classification than Transport Worker Grade 2, provided a further reason for the primary judge to conclude that the TWU case should be dismissed. Our agreement with those conclusions means that the appeal must be dismissed and we will so order.” 32

[152] Aside from the CSAs who gave evidence on behalf of the TWU and the SDA respectively, there is nothing to indicate the attitude towards a separate agreement for CSAs of the some 744 CSAs who do not belong to either the TWU or the SDA. When considering the views of employees, I have been influenced by the relative numbers of CSAs enrolled in the TWU and the SDA. If one is to presume that the 9% of CSAs who belong to the TWU are therefore in favour of a separate agreement then it follows that the 40% who belong to the SDA are opposed to such a course. It therefore follows that of the persons whose opinion on the matter can be possibly intuited, a majority of them do not want a separate agreement. In addition, should a scope order be granted, some 2040 (or 62% of the total) employees of Coles Online, working as Personal Shoppers, would be excluded.

[153] I have decided and find that there is nothing of any substance before me to convince me that the making of the order sought ‘will promote the fair and efficient conduct of bargaining’. In fact, the granting of such an order would have, in my view, exactly the opposite effect.

[154] I must also consider s.238(4)(c), taking into account the provisions of s238(4)(A), as to whether the group of employees who would be covered by the agreement proposed in the scope order was fairly chosen.

[155] In Cimeco Pty Ltd v Construction, Forestry, Mining and Energy Union 33(Cimeco), the Full Bench relevantly said at paragraph 21: “The work ‘fairly’ suggest that the selection of the group was not arbitrary or discriminatory.” The Bench went on to say: “In evaluating whether the group to be covered by the agreement has been fairly chosen it is entirely appropriate to have regard to the consequences of that choice, that is, which employees have been excluded from the agreement.”34

[156] I respectfully agree with the Full Bench in Cimeco and also rely on my comments about Personal Shoppers at paragraph 151 above.

[157] In Kwinana, the Full Bench said:

“[15] Enterprise agreements that cover all employees in a business are commonplace. Almost all such business will have organisation structures that will allow organisationally distinct groups to be identified. Many of those businesses contain operationally distinct groups. Yet it will rarely be the case that a 'whole of enterprise' group would be unfairly chosen.

[16] It follows that the weight to be attached to the geographical, operational or organisational distinctness of groups with a broader group will be neutral in determining whether an order ought be made, unless there are particular features of, or circumstances associated with, that distinctness that render the broader group one that is not fairly chosen.” 35

[158] The Bench in Kwinana went on to make an observation which is relevant to the TWU’s assertion of bad faith on the part of Coles and the SDA when they changed their earlier positions and opposed a separate agreement for CSAs:

“... The fact that the Union agreed in the 2010 approval applications that the separate operator and laboratory technician groups were fairly chosen does not prevent it from asserting in 2013 that a single group consisting of operators and laboratory technicians is also fairly chosen and more appropriate.” 36

[159] In the current proceedings, I would have thought that the observations in the Federal Court Decision referred to at paragraph 149 above may well have deterred the TWU from continuing to seek a scope order.

[160] It is apparent to me on the totality of the evidence and materials before me, and taking into account the Federal Court decision, that the CSAs within the Online Department do not constitute a ‘fairly chosen’ group and I so find.

[161] I now turn to s.238(4)(d) as to whether it is reasonable in all the circumstances to make the order. In my view and I find, it is not reasonable to make the order sought.

[162] The hearing proceeded over seven, sometimes glacially-slow, days. In the end, little emerged that had not been considered by the FCCA and a Full Court of the Federal Court. The TWU’s application for a scope order represents the grip that its attachment to the Transport Award has. Over time, this appears to have developed into an idée fixe, which not even the Federal Court can make it abandon. The factual situation is that CSAs as members of the Online Departments within Coles stores and overall as employees of Coles Online, are an integrated and integral part of the retail operations. They are not transport workers despite the fact that some of them choose to describe themselves as ‘drivers’, as does the TWU. They are not organisationally distinct any more than in-store Meat Department or Bakery employees are.

[163] The proper place for CSAs is within a new single Coles retail agreement and an in-principle agreement reached some five months ago between Coles and the SDA provides for a 5% loading for CSAs. In that context, I note the obiter comments of Driver J that, despite his finding that Retail Employee Level 1 was the appropriate classification for CSAs, his view was that the truck driving skills required of CSAs, which are both central to their role and additional to the usual tasks performed in store by them and other employees, ought to be adequately and appropriately recompensed. He went on to say that the Level 3 classification may be the most appropriate. In that context, the 5% wage differential for CSAs negotiated between the SDA and Coles requires further examination to give a complete picture.

[164] My examination of the Retail Award shows that the current differential between a Retail Employee Level 1, which is the level the Federal Court found was appropriate for CSAs, and the Level 3 position is currently around 3.83%. The differential between a Level 1 and Level 4 employee is currently around 5.67%. It is therefore obvious that the 5% differential between CSAs and other employees negotiated between the SDA and Coles very much adopts or exceeds the view expressed by Driver J in his obiter comments.

[165] The TWU and its witnesses placed a great deal of emphasis on such matters as safety, injuries, training, consultation and the specialised clothing and footwear needs of CSAs. The addressing of those matters does not require CSAs to be covered by a separate agreement and can be adequately dealt with in negotiations with Coles. Such issues do not ultimately form a reason or even a part of a reason to grant a scope order.

[166] Based on my reasoning above and the findings made as a result, I dismiss the scope order application.

COMMISSIONER

Appearances:

M Gibian of counsel for the Transport Workers’ Union of Australia.

S Wood, SC with M Felman of counsel for Coles Supermarkets Australia Pty Ltd.

W Friend, SC with C Dowling of counsel for Shop, Distributive and Allied Employees Association.

Hearing details:

2014.

December 2, 3, 11.

2015.

January 29, 30.

February 4, 16.

 1 [2014] FCCA 4.

 2   Ibid at para 239.

 3 [2014] FCAFC 148.

 4   Exhibit TWU 2.

 5   Exhibit TWU 3.

 6   Exhibit TWU 4.

 7   Exhibit TWU 5.

 8   Exhibit TWU 6.

 9   Exhibit TWU 7.

 10   Exhibit TWU 8.

 11   Exhibit TWU 9.

 12   Exhibit TWU 10.

 13   Exhibit Coles 29.

 14   Exhibit Coles 32.

 15   Exhibit Coles 33.

 16   Exhibit Coles 34.

 17   Exhibit Coles 35.

 18   Exhibit Coles 36.

 19   Exhibit Coles 37.

 20   Exhibit SDA 1.

 21   Exhibit SDA 3.

 22   Exhibit SDA 4.

 23   Exhibit TWU 12.

 24   Exhibit Coles 40.

 25   Exhibit SDA 5.

 26   [2013] FWC 9851.

 27   [2014] FWC 1361.

 28   [2014] FWCFB 1476.

 29   Ibid at paragraph 26.

 30   Ibid at paragraph 27.

 31 [2014] FCAFC 148 at paragraphs 30 and 31.

 32   Ibid at paragraphs 34-36.

 33   [2012] FWAFB 2206.

 34   Ibid at paragraph 22.

 35   [2014] FWCFB 1476 at paragraphs 15 and 16.

 36   Ibid at paragraph 20.

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