United Firefighters' Union of Australia
[2014] FWCFB 3652
•19 AUGUST 2014
| [2014] FWCFB 3652 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 6, Item 4 - Application to make a modern award to replace an enterprise instrument.
(EM2013/149)
Fire fighting services | |
VICE PRESIDENT WATSON | MELBOURNE, 19 AUGUST 2014 |
Preliminary Full Bench Decision on Threshold Issues regarding the Victorian Firefighting Industry Employees Interim Award 2000- whether award is an enterprise instrument - status of common rule declaration - effect of common rule declaration on the status of the award - award does not only apply to a single enterprise - application to make a modern enterprise award dismissed - Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 Schedule 6, Items 2, 4. Workplace Relations Amendment (Work Choices) Act 2005 Part 2 Schedule 4, Item 4, sub-items (4), (5).
Introduction
[1] This decision concerns a threshold issue that arises in relation to an application by the United Firefighters Union of Australia (the UFU) for the making of a Modern Enterprise Award covering employees employed by the Metropolitan Fire and Emergency Services Board (the MFB) in classifications covered by the Victorian Firefighting Industry Employees Interim Award 2000 (the 2000 Award).
[2] The threshold issue, raised by the MFB, is that the 2000 Award is not an enterprise instrument and the jurisdiction to make a modern enterprise award is not enlivened.
[3] At the hearing of this matter on 28 May 2014 Mr J McKenna, of counsel, appeared for the UFU. Mr F Parry QC with Mr R Dalton counsel appeared for the MFB.
Relevant Statutory Provisions
[4] The UFU application is made under Item 4 of Schedule 6 to the Fair Work (Transitional Provisions and Consequential Amendments)Act 2009 (the Transitional Act) which relevantly provides:
4 The enterprise instrument modernisation process
(1) The enterprise instrument modernisation process is the process of making modern awards under this Division to replace enterprise instruments.
(2) On application, the FWC may make a modern award (a modern enterprise award) to replace an enterprise instrument.
(3) The application may be made only:
(a) by a person covered by the enterprise instrument; and
(b) during the period starting on the WR Act repeal day and ending at the end of 31 December 2013.
(4) A modern enterprise award must be made by a Full Bench.
[5] It is inherent in the nature of the enterprise instrument modernisation process that an enterprise instrument exists so that it can be subject to the process. The term “enterprise instrument” is defined in Item 2 of Schedule 6 as follows:
2 Enterprise instruments
(1) Each of the following is an enterprise instrument:
(a) an enterprise award-based instrument;
(b) an enterprise preserved collective State agreement;
(c) a Division 2B enterprise award.
(2) An enterprise award-based instrument is an award-based transitional instrument, other than a State reference public sector transitional award, to which sub-item (2A) or (2B) applies.
(2A) This sub-item applies to an award-based transitional instrument that is an award or a State reference transitional award, if the award or State reference transitional award covers employees in:
(a) a single enterprise (or a part of a single enterprise) only; or
(b) one or more enterprises, if the employers all carry on similar business activities under the same franchise and are:
(i) franchisees of the same franchisor; or
(ii) related bodies corporate of the same franchisor; or
(iii) any combination of the above.
(2B) This sub-item applies to an award-based transitional instrument that is a notional agreement preserving State awards, if the notional agreement includes terms and conditions from a State award (within the meaning of the WR Act) that covered employees in:
(a) a single enterprise (or a part of a single enterprise) only; or
(b) one or more enterprises, if the employers all carried on similar business activities under the same franchise and were:
(i) franchisees of the same franchisor; or
(ii) related bodies corporate of the same franchisor; or
(iii) any combination of the above.
(3) An enterprise preserved collective State agreement is a transitional instrument that is a preserved collective State agreement in relation to which the following paragraphs are satisfied:
(a) a State or Territory law had, on the day before the commencement of Part 2 of Schedule 4 to the Workplace Relations Amendment (Work Choices) Act 2005, the effect (however described) of converting a State award (within the meaning of the WR Act) into the relevant State employment agreement (within the meaning of the WR Act);
(b) if the State award had continued to have effect in relation to employees, a notional agreement preserving State awards to which subitem (2B) applies would have been taken to come into operation in relation to those employees.
(4) A Division 2B enterprise award is a Division 2B State award that covers:
(a) a single enterprise (or a part of a single enterprise) only; or
(b) one or more enterprises, if the employers all carry on similar business activities under the same franchise and are:
(i) franchisees of the same franchisor; or
(ii) related bodies corporate of the same franchisor; or
(iii) any combination of the above.
[6] In this case the MFB contends that, for the purposes of Sub-Item 2A, the 2000 Award is not an award that only covers employees in a single enterprise (or part of a single enterprise), and no other paragraph of Item 2 applies. The UFU contends that the 2000 Award only covers employees in a single enterprise and accepts that if it does not, it is not an enterprise instrument. The resolution of this conflict requires a consideration of the coverage of the 2000 Award.
The Coverage of the 2000 Award
[7] Clause 3.1 of the 2000 Award provides:
- Metropolitan Fire and Emergency Services Board
- Country Fire Authority
This award shall be binding upon the United Firefighters Union of Australia, its members and those employees eligible to be members employed in any of the classifications set out in this award, and the employees identified below:
[8] On 18 November 2004 the Australian Industrial Relations Commission made a declaration pursuant to sections 141 and 493A of the Workplace Relations Act 1996 (the WR Act) that the 2000 Award was to have common rule effect as from 1 January 2005. As a result of the common rule declaration a number of private sector organisations engaged in fire fighting became bound by the 2000 Award.
[9] Both the MFB and CFA have been held by the Federal Court to be constitutional corporations by virtue of their trading activities. The decision concerning the status of the CFA is under appeal and contentions made by the parties before the Court seek a reconsideration of its status. However for the purposes of the threshold argument advanced in the proceedings before this Full Bench, the MFB contends that the 2000 Award is not an enterprise award in any event because of its common rule status. The UFU contends otherwise.
[10] The arguments require a consideration of the effect of the common rule declaration on the status of the 2000 Award and a consideration of the legislative provisions applying to the 2000 Award.
Legislative History
[11] Common Rule Declarations were made under section 141 of the WR Act. That section permitted the Commission to declare, in the context of an industrial dispute it was dealing with in a Territory, that any term of an award shall, subject to conditions, exceptions and limitations be a common rule in that Territory, for the industry in which the industrial dispute arose. Section 493A extended the power in s.141 to employment in Victoria.
[12] Section 142C of the WR Act, which commenced in 2004, provided:
“To avoid doubt, a common rule declared under subsection 141(1) or (2) is taken to be an award of the Commission for the purposes of sections 152, 170LY and 170VQ.”
[13] Section 142(1) dealt with the effect of variations to the underpinning award. It provided:
“Subject to this section, where the Commission varies a term of an award that is a common rule in a Territory for an industry, the variation is, by force of this sub-section, a common rule in the Territory for the industry with effect from the date of effect of the variation.”
[14] It appears to us clear that an award on the one hand and a declaration on the other, were separate instruments, each having effect as an award. The more difficult question is whether the making of a common rule declaration affected the scope of the award itself. The wording of section 142 suggests that it did, and that an award subject to a declaration became a common rule award with effect across the relevant industry in the relevant State or Territory.
[15] In 2006, by virtue of the Workplace Relations Amendment (Work Choices) Act 2005 (the Work Choices Act),awards undertook a transformation. Awards became replaced by new instruments known as “Pre-Reform Awards”. This change was effected by Schedule 4 to the Work Choices Act. Item 4 of that schedule was as follows:
4 Operation of awards in force before commencement
(1) In this item:
award means an award within the meaning of subsection 4(1) of the Workplace Relations Act 1996 as in force immediately before the reform commencement.
eligible entity has the same meaning as in Division 6A of Part VI of the amended Act.
employee has the meaning given by subsection 4AA(1) of the amended Act.
employer has the meaning given by subsection 4AB(1) of the amended Act.
outworker term has the same meaning as in Division 6A of Part VI of the amended Act.
(2) This item applies to an award (the original award) in force immediately before the reform commencement.
(3) The original award is taken to be replaced by an instrument (the pre-reform award)in the same terms as the original award that, on and from the reform commencement, has effect under the Workplace Relations Act 1996 and binds the following:
(a) each employer that was bound immediately before the reform commencement by the original award;
(b) each organisation that was bound immediately before the reform commencement by the original award;
(c) each employee of an employer referred to in paragraph (a), in relation to the employee’s employment by the employer, to the extent that the original award regulates work performed by the employee;
(d) each eligible entity that was bound immediately before the reform commencement by the original award, but only in relation to outworker terms.
(4) To avoid doubt, the pre-reform award binds an employer or eligible entity that was bound by the original award immediately before the reform commencement, whether the employer or eligible entity was bound:
(a) in its own right or as a member of an organisation; or
(b) because of the operation of paragraph 149(1)(d) or (e) of the Workplace Relations Act 1996, as in force immediately before the reform commencement.
(5) To avoid doubt, if the original award bound an employer, an eligible entity or an organisation as a common rule under paragraph 149(1)(e), the pre-reform award is, to the extent that the pre-reform award binds that employer, eligible entity or organisation, subject to any conditions, exceptions or limitations to which the original award was subject because of the operation of section 141 of the Workplace Relations Act 1996 as in force immediately before the reform commencement.
[16] This provision is critical to the argument in this case because the 2000 Award is a pre-reform award by application of this provision.
The Current Scope of the 2000 Award
[17] The MFB contends that the effect of the common rule declaration was to extend coverage of the award subject to certain specified exclusions or limitations. Further, it contends that the 2000 Award, as extended by the common rule declaration, became a pre-reform award by virtue of item 4 of Schedule 4 of the Work Choices Act. The MFB relies in particular on sub-items (4) and (5) of Item 4 to contend that the pre-reform award binds employers because of the operation of the common rule provisions of the WR Act.
[18] The UFU contends that the Common Rule Declaration was an additional instrument to the 2000 Award, it was an award in its own right, and its effect was not to make the 2000 Award apply to the common rule parties. It submits that the transitional provisions of the Work Choices Act make it clear that common rule parties were bound by pre-reform awards but the Work Choices Act did not extend the scope of the 2000 Award to common rule parties.
[19] In our view the construction of the various legislative provisions advanced by the MFB is to be preferred. It is strongly arguable that the effect of the common rule declaration, regardless of its status as an award or other instrument, was to extend the coverage of the 2000 Award to the common rule parties.
[20] However the position prior to 2006 is in some ways beside the point. Whatever situation applied before 2006, because of the Work Choices legislation, the 2000 award covered the common rule parties when it became a pre-reform award. In our view, Sub-Items 4 and 5 do more than bind common rule employers to common rule declarations. The provisions make it clear that pre-reform awards bind employers who are bound by the award because of a common rule declaration. The 2000 Award was one such award.
Conclusions
[21] It follows that the 2000 Award is not an award that applies only to a single enterprise and is therefore not an enterprise award based instrument capable of being subject to modernisation under Item 4 of Schedule 6 to the Transitional Act.
[22] As the 2000 Award is not capable of being the subject of an application for modernisation under item 4 of Schedule 6, the application by the UFU is invalid and must be dismissed.
[23] In our view, as a result of the award modernisation process, the 2000 Award was completely replaced by the Fire Fighting Industry Award 2010. Pursuant to Item 3 of Schedule 5 of the Transitional Act we intend to make an order terminating the 2000 Award.
[24] Any party wishing to make submissions on this proposed course of action beyond the submissions already made in the proceedings should do so in writing within 7 days of the date of this decision.
VICE PRESIDENT
Appearances:
Mr F Parry, QC, and with him Mr R Dalton of Counsel, with permission for Metropolitan Fire and Emergency Services Board.
Mr J McKenna, of Counsel, with permission for United Firefighters Union of Australia
Hearing details:
2014
Melbourne
28 May
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