Ultrarad Pty Ltd T/A Queensland X-Ray
[2023] FWC 3353
•14 DECEMBER 2023
| [2023] FWC 3353 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
Ultrarad Pty Ltd T/A Queensland X-Ray
(AG2023/4519)
| Health and welfare services | |
| COMMISSIONER DURHAM | BRISBANE, 14 DECEMBER 2023 |
Application for an order relating to instruments covering new employer and transferring employees
An application has been made by Ultrarad Pty Ltd T/A Queensland X-Ray (the Applicant) to the Fair Work Commission (the Commission) for an order pursuant to s.318 of the Fair Work Act 2009 (the Act).
Orders Sought
The Applicant is seeking orders that:
1. Pursuant to s. 318(1)(a) of the Fair Work Act 2009 (Cth), that the Commission orders that The Hunter Imaging Group Enterprise Agreement 2021 does not, and will not, cover Mr Domanic Hermans in relation to his employment with Ultrarad Pty Ltd.
2. Pursuant to s. 318(4) of the Fair Work Act 2009 (Cth), order 1 comes into effect at the time Mr Herman’s commences employment with Ultrarad Pty Ltd.
In support of this Application, Ultrarad Pty Ltd trading as Queensland X-Ray relies on:
1. A statement from Mr Jamie Byrnes, Operations Manager of Queensland X-Ray dated 22 November 2023.
2. A statement from Mr Dominic Hermans dated 22 November 2023 (with his offer of employment).
Jurisdictional Background
For the reasons set out below, the Applicant submitted that the Commission has jurisdiction to make the orders sought by the Applicant under s.318(1)(a) of the Act.
Relevantly:
(a) pursuant to s.318(2) of the FW Act, the Commission can only make the order sought under s.318(1)(a) of the Act on application by the new employer or a “transferring employee”;
(b) an order under s.318(1)(a) can be made if a “transferrable instrument” “would be likely to” “cover the new employer and a transferring employee” because of s.313(1)(a) of the Act;
(c) section 313(1)(a) of the Act provides that if a “transferrable instrument” covered “the old employer and a transferring employee immediately before the termination of the transferring employee’s employment” then “the transferable instrument covers the new employer and the transferring employee in relation to the transferring work after the time the transferring employee becomes employed by the new employer”;
(d) a “transferring employee” is defined in s.311(2) as an employee who satisfies the requirements of s.311(1)(a), (b) and (c) of the Act; and
(e) under s.312(1)(a), a “transferrable instrument” is an enterprise agreement.
It was submitted that Ultrarad Pty Ltd t/a Queensland X-Ray (Queensland X-Ray) and Hunter Imaging Pty Ltd (Hunter Imaging) are both constitutional corporations, and within the coverage of the Act. Further, it was submitted that both Queensland X-Ray and Hunter Imaging are employers within the meaning of the Act.
The Applicant submitted that Queensland X-Ray and Hunter Imaging are related entities as they are part of the Sonic Healthcare group of companies. As such Queensland X-Ray and Hunter Imaging are associated entities within the meaning of s. 50AAA of the Corporations Act 2001 (Cth).
The Applicant submits that Mr Hermans is currently substantially employed as a Diagnostic Radiographer at Hunter Imaging in the NSW Hunter region. Mr Hermans is an employee within the meaning of the Act.
Mr Hermans approached Queensland X-Ray about taking up a role as Diagnostic Radiographer at the Gold Coast. Mr Hermans has made the decision to relocate to Gold Coast long-term, and as such, is keen for employment with Queensland X-Ray in a permanent full-time role. Queensland X-Ray has made an offer of employment to him. A copy of Mr Hermans’ offer of employment was attached to the Application. The offer of employment is conditional on an order being made by this Commission under s 318(1) of the Act.
Mr Hermans seeks to commence employment with Queensland X-Ray on 8 January 2024 which is within three (3) months of his employment terminating with Hunter Imaging by way of resignation on 7 January 2024. This fact satisfies the requirement of s. 311(1)(a) and (b) of the Act.
It was submitted that the work Mr Hermans will perform for Queensland X-Ray is substantially the same to the work Mr Hermans performed for Hunter Imaging. This fact satisfies the requirement of s 311(1)(c) of the Act.
As a result of the corporate relationship between Queensland X-Ray and Hunter Imaging, there is a relevant connection between the two entities for the purposes of s. 311(1)(d) of the Act.
It was submitted that as a result of the matters set out above, and for the purposes of s. 311 of the Act, there would be a transfer of business from Hunter Imaging (the old employer) to Queensland X-Ray (the new employer), and that as Mr Hermans would commence with the new employer within 3 months of his employment terminating with the old employer, he would be a transferring employee.
The instrument covering Mr Hermans employment with the old employer was the HIG EA. On the basis of the above, this agreement is a transferrable instrument within the meaning of s. 312 of the Act. Accordingly, the HIG EA is likely to cover Mr Hermans in his employment with Queensland X-Ray.
Queensland X-Ray, the employer, has made this Application, as required by s. 318(2) of the Act. As such, the Commission has jurisdiction to make the order, subject to its consideration of matters it must take into account under s. 318(3) of the Act
Before examining each of the matters in s.318(3) of the FW Act the Commission “must take into account”, the following background as provided below.
Background
At Queensland X-Ray, Mr Hermans will be engaged as a Health Professional Level 1 Pay Point 6 (Radiographer) under the Health Professionals and Support Service Award 2020 (Award). It was submitted that Mr Hermans will be located in the Gold Coast Region, a location that accommodates for his personal needs.
For many reasons, including those set out below, Queensland X-Ray does not want the HIG EA applying to employees employed in its business. As such, Mr Hermans has been offered employment with Queensland X-Ray only on the condition that an order is made under s. 318(1) of the Act. If the order is not made, Mr Hermans will not be employed.
Statutory provisions
Section 318 of the Act relates to the application sought by the Applicant. Section 318(3) of the Act sets out those matters the Commission must have regard to in determining if the orders sought should be granted.
Section 318 provides as follows:
318 Orders relating to instruments covering new employer and 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 transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;
(b)an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.
Who may apply for an order
(2) The FWC may make the order only on application by any of the following:
(a)the new employer or a person who is likely to be the new employer;
(b)a transferring employee, or an employee who is likely to be a transferring employee;
(c)if the application relates to an enterprise agreement—an employee organisation that is, or is likely to be, covered by the agreement;
(d)if the application relates to a named employer award—an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (b).
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.
Restriction on when order may come into operation
(4) The order must not come into operation in relation to a particular transferring employee before the later of the following:
(a)the time when the transferring employee becomes employed by the new employer;
(b)the day on which the order is made.
Consideration
Matters that the FWC must take into account
318(3)(a)(i) – views of Queensland X-Ray
Queensland X-Ray applies for the order under s. 318(1)(a) of the Act
Queensland X-Ray seeks an order to facilitate the employment of Mr Hermans. If the order is not made, Queensland X-Ray will not employ Mr Hermans.
318(3)(a)(ii) – views of Mr Hermans
It was submitted that Mr Hermans has freely accepted an offer of employment with Queensland X-Ray, fully aware of the basis of the offer, including that the HIG EA does not transfer. Mr Hermans was not obliged to accept the offer. Mr Hermans has chosen to accept the offer and Mr Hermans supports the Application for the order.
A statement in support from Mr Hermans was attached to the Application.
318(3)(b) – whether Mr Hermans will be disadvantaged by the order
The Applicant submitted that the order (and consequently employment with Queensland X-Ray on the terms set out in his offer of employment) provides Mr Hermans with a number of advantages in relation to the terms and conditions of his employment with Queensland X-Ray:
(a) his rate of pay will increase from her substantive position’s hourly rate of $43.31037 to an hourly rate of $44.04;
(b) his service with Hunter Imaging Group will count as service with Queensland X-Ray, sick leave, annual leave and long service leave entitlements will be transferred to Queensland X-Ray;
(c) he will be entitled to an additional 5 days of annual leave (pro-rated as a part-time employee) in addition to the statutory entitlement of 4 weeks of paid annual leave per year of continuous service (pro-rated as a part-time employee) in accordance with Queensland X-Ray policy. This is a default entitlement which is more beneficial than employees covered by the HIG EA who need to satisfy eligibility criteria as a shift worker to be entitled to the additional 5 days of annual leave; and
(d) he will be entitled to paid parental leave at Queensland X-Ray which is not an entitlement under the HIG EA. The entitlement at Queensland X-Ray is twelve (12) weeks of paid parental leave.
The Applicant submitted that there are other benefits in the HIG EA that Mr Hermans will no longer be entitled to receive, but the loss of these benefits are accepted by Mr Hermans:
(a) he will no longer be entitled to severance pay as outlined in clause 32.2 of the HIG EA. The redundancy scale in the HIG EA is above the NES. This is a minor disadvantage (though Mr Hermans remains entitled to the NES standard determined to be fair by Parliament). The entitlement to redundancy pay is contingent on the role being made redundant and there being no redeployment opportunities. Mr Hermans accepts that he will not be entitled to this benefit as part of accepting the role at Queensland X-Ray. Further the increased redundancy entitlement is a benefit not enjoyed by employees at Queensland X-Ray (who are subject to the NES).
Further, Mr Hermans will also be required to undergo a probationary period of six months upon commencement of his permanent full-time contract at Queensland X-Ray.
318(3)(c) – nominal expiry date
The HIG EA which currently covers Mr Hermans has a nominal expiry date of 3 August 2024. The (insert name and expiry date of new agreement he will be covered by). As the operation of the new agreement will exceed the operation of the current agreement, I consider this to be a neutral consideration.
318(3)(d) – negative impact on productivity
The Applicant submitted this consideration has no application on the facts of this matter.
318(3)(e), (f) – economic disadvantage and degree of business synergy
It was submitted that the transfer of the HIG EA to Queensland X-Ray will result in additional administrative burdens in administrating different terms and conditions compared to employees at Queensland X-Ray.
Queensland X-Ray and Hunter Imaging are distinct and different entities. It was submitted whilst the industry in which they operate are aligned, the macro conditions are vastly different due to the size and make up of operations, with Queensland X-Ray being more hospital-based compared to Hunter Imaging.
Mr Hermans will be working alongside employees who will not be covered by the HIG EA. For legitimate business reasons, Queensland X-Ray does not want employees working alongside each other, covered by different terms and conditions. It seeks to avoid disparity and discontentment between employees performing similar work and working together.
318(3)(g) – public interest
Given the above, the Applicant submitted it is not against the public interest to grant the order sought by Queensland X-Ray.
I have reviewed the application documentation and the accompanying material including the Statements provided. These documents outline the circumstances which have given rise to the application. Further, the submissions contained in the application address the relevant legislative requirements which are asserted to provide for a proper basis for the making of the orders sought.
I am satisfied that the requirements of s.318 of the Act have been met. Orders will be issued with this Decision.
COMMISSIONER
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