Tunnel Force Australia Pty Ltd
[2012] FWA 9073
•26 SEPTEMBER 2012
[2012] FWA 9073 |
|
DECISION |
Fair Work Act 2009
s.217—Enterprise agreement
Tunnel Force Australia Pty Ltd
(AG2012/10589)
TUNNEL FORCE AUSTRALIA ENTERPRISE AGREEMENT 2010
Building, metal and civil construction industries | |
COMMISSIONER GOOLEY | MELBOURNE, 26 SEPTEMBER 2012 |
Application for approval of the Shift allowances in section 22.5 and section 4 of Appendix D.
[1] Tunnel Force Australia Pty Ltd (the Applicant) made an application pursuant to section 217(1)(a) of the Fair Work Act 2009 (FW Act) to vary the Tunnel Force Australia Enterprise Agreement 2010 (the Agreement), an agreement approved by Fair Work Australia on 28 April 2010 which operated from 5 May 2010 and has a nominal expiry date of 5 May 2012.
[2] The Agreement provides at clause 22.5 for the payment of shift allowances as follows:
“22.5 Shift Allowances
(a) Where an Employee is required to perform weekday afternoon or night shift work that continues for at least five consecutive shifts, the Employee/s shall be paid a shift loading of 25% for such work.
(b) An Employee who works on a weekday afternoon or night shift which does not continue for at least five successive afternoons or nights shall be paid for such shift time and a half for the first three hours thereof and double time thereafter. Shift loading will not apply.”
[3] Section 4 Shift Allowance of Appendix D provides as follows:
“4. SHIFT ALLOWANCE
(a) Shift Workers will be paid the following rates for ordinary hours worked:
(i) Afternoon Shift for CW/ECW, EW and MTW grades - Wage Rate plus 25% of the Wage Rate.
(ii) Night Shift for CW/ECW, EW and MTW grades - Wage Rate plus 50% of the Wage Rate.
(iii) Afternoon Shift for CW and MCW grades - Wage Rate plus 15% of the Wage Rate.
(iv) Night Shift for CW/ECW and MCW grade - Wage Rate plus 30% of the Wage Rate.
(b) Shift loading shall not apply to shift work performed on a Saturday or Sunday.
(c) Where an Employee works for less than five continuous shifts the overtime rates prescribed in clause 21 of this Agreement will be payable in lieu of the applicable shift loading.
(d) Under no circumstances shall an Employee be entitled to shift loading pursuant to this clause and overtime rates under clause 21 of this Agreement at the same time. For the avoidance of doubt an Employee shall only be entitled to shift loading or overtime but not both.”
[4] The Applicant submitted that there is uncertainty and ambiguity between clause 22.5(b) and sub-paragraphs 4(a)(i), (ii), (iii) and (iv) of Appendix D and to resolve that uncertainty and ambiguity, sub-paragraphs 4(a)(i), (ii), (iii) and (iv) of Appendix D should be deleted.
[5] I directed that the Applicant provide a copy of the application and notice of hearing to employees covered by the Agreement. A statutory declaration filed by the employer advised that there were no employees currently employed by the Applicant but that there would be employees employed in the near future.
The Legislative Framework
[6] Section 217 of the FW Act provides Fair Work Australia with the power to vary an enterprise agreement to remove an ambiguity or uncertainty as follows:
“(1) FWA may vary an enterprise agreement to remove an ambiguity or uncertainty on application by any of the following:
(a) one or more of the employers covered by the agreement;
(b) an employee covered by the agreement;
(c) an employee organisation covered by the agreement.
(2) If FWA varies the enterprise agreement, the variation operates from the day specified in the decision to vary the agreement.”
Consideration
[7] What are the differences between the clauses:
CLAUSE 22.5 | Appendix D Sub-paragraphs 4(a)(i) and (ii) | Appendix D Sub-paragraphs 4(a)(iii) and (iv) | |
Afternoon shift cts 5 shifts | 25% loading | 25% loading (CW/ECW, EW and MTW grades) | 15% loading (CW and MCW grades) |
Night shift cts 5 shifts | 25% loading | 50% loading (CW/ECW, EW and MTW grades) | 30% loading (CW/ECW and MCW grades) |
[8] It is not clear that there are inconsistencies between clause 22.5 of the Agreement and sub-paragraphs 4(a)(i) and 4(a)(ii) of Appendix D. The latter provides penalty rates for specific classifications. Not all the classifications are included. It is therefore reasonable to assume that clause 22.5 provides a shift penalty for those who are not included in Appendix D.
[9] There is an inconsistency within clause 4 of Appendix D which provides different rates for afternoon and night shifts with no explanation as to when one and not the other applies. This gives rise to an uncertainty.
[10] Having found that uncertainty exists, the Tribunal has the discretion to vary the Agreement to remove ambiguity or uncertainty. “In exercising such a discretion the Commission is to have regard to the mutual intention of the parties at the time the Agreement was made.” 1
[11] That task in this case is not assisted by the fact that no employees remain employed with the Applicant.
[12] In the statutory declaration filed with the application for approval of the Agreement the Applicant identified clause 22 of the Agreement as providing for a less beneficial entitlement than the modern award however this statement is true of both clause 22 and Appendix D.
[13] The Applicant submitted that the confusion in the Agreement arose from the fact that the Agreement was made during the transitionary period and the Agreement sought to bring together the modern award and the predecessor award.
[14] The modern award is the building and Construction General On-site Award 2010 (the modern award) and the predecessor award was the National Building and Construction Industry Award 2000 (the predecessor award). 2 The difficulty with the submissions of the Applicant is that both the modern award and the predecessor award provided for the same shift penalty rates for afternoon and night shift of 50%.
[15] The Applicant submitted that it was the intention of the parties that the 25% penalty apply, however no evidence was called to support this submission. As the submissions were given on instructions it is more likely that those instructions were based on the intentions of the Applicant. However that does not assist me to determine what the mutual intentions of the parties were.
[16] In supplementary submissions filed after the hearing the Applicant submitted that when Commissioner Ryan approved the Agreement he had no regard to clause 4 of Appendix D. It is not clear on what basis that submission is made. Further the Applicant submitted that Senior Deputy President Richards had approved the Austunnel Pty Ltd Enterprise Agreement 2012 which provided for a shift penalty of 15%. It is not clear what conclusion the Applicant wants drawn from this submission.
[17] The Applicant submitted that its Agreement would pass the better off overall test even with a 25% night shift penalty. I accept that it would not be a proper exercise of my discretion to vary an agreement if employees would be worse off under the agreement than under the modern award however it is not a relevant consideration that the variation sought by the Applicant would not result in employees being worse off than under the modern award.
[18] The Applicant submitted that sub-paragraphs 4(a)(iii) and (iv) of Appendix D should be removed. I am prepared to exercise my discretion to remove these sub-paragraphs.
[19] However without more evidence as to the mutual intention of the parties I am not prepared to make any other variations to the Agreement.
[20] I note that the Agreement has passed its nominal expiry date and the Applicant advised that it intended negotiating a new agreement with employees once they have been engaged. The parties will then have an opportunity to address, as part of that renegotiation, the penalty to be paid for shift work.
COMMISSIONER
1 Tenix Defence Pty Limited re Tenix Defence Systems Pty Ltd Certified Agreement 2001- 2004 PR917548 at [54]
2 Statutory Declaration of Mr Nicholas O’Connor 4 February 2010.
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