United Workers' Union v Inghams Enterprises Pty Ltd t/a Inghams

[2021] FWC 2944

[2021] FWC 2944

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

United Workers’ Union
v
Inghams Enterprises Pty Ltd t/a Inghams
(C2020/7107)

DEPUTY PRESIDENT MANSINI MELBOURNE, 25 MAY 2021

Application to deal with a dispute in accordance with a procedure in an enterprise agreement.

[1] This decision relates to an application lodged by the United Workers’ Union (Union) under section 739 of the Fair Work Act 2009 (Cth) (Act) and the disputes avoidance procedure in the Inghams Enterprises (Victoria Processing and Distribution) Enterprise Agreement 2016 (Agreement).

[2] The Agreement covers and is expressed as binding upon: the Union, Inghams Enterprise Pty Ltd (Inghams) and employees of Inghams at its Somerville processing plant and Lyndhurst distribution centre.1

[3] This dispute concerns the rate of pay for employees commencing work prior to 4.00am.

Jurisdiction and the issue for determination

[4] Following two attempts at conciliation, there was no agreed resolution of the dispute. The parties agreed to arbitration of the following questions:

1. If an employee commences work before 4.00am, and their rostered hours fall within the span of day work, are they required to be paid an early morning shift allowance (clause 4.3(2)(a))?

2. In the alternative, are they able to be paid overtime for the time worked before 4.00am?

[5] There is no dispute between the parties and I am satisfied that the pre-requisites to the Commission’s involvement have first been followed, such that the Commission is empowered to resolve the dispute by determination of the agreed questions in accordance with the disputes avoidance procedure at clause 6.3 of the Agreement and s.739 of the Act.

The Agreement

[6] Part 4 of the Agreement is titled “HOURS OF WORK, BREAKS AND OVERTIME” and is comprised of the following clauses:

•  4.1 – Hours of Work

•  4.2 – Day Workers

•  4.3 – Shift Work

•  4.4 – Rosters

•  4.5 – Overtime

•  4.6 – Meal Interval

•  4.7 – Breaks

•  4.8 – Saturday and Sunday Work

•  4.9 – Public Holiday Guarantee

(clauses 4.1 to 4.5 are most pertinent, extracted in full at Annexure A to this decision).

The respective contentions

[7] Each party to the dispute contends that the Agreement is not ambiguous yet alternate constructions are pressed.

[8] The Union contends that employees commencing work at or after 2.00am and before 4.00am are working an “early morning shift”. It relies on the definition at sub-clause 4.3(2)(a) of the Agreement, which it says is not limited by reference to rostered work and expressly provides that any shift commencing at or after 2.00am and before 4.00am is treated as an early morning shift. It says in these circumstances the span of hours for day workers at clause 4.2 does not apply and an additional 15% penalty is payable for each hour of the shift worked.

[9] Inghams asks the Commission to find that a day worker who is asked to commence work prior to 4.00am is entitled to be paid overtime for the additional (un-rostered) time worked prior to 4.00am. Inghams seeks to distinguish this from scenarios: where the earlier commencement is not requested or approved by Inghams, in which case it says the earlier start is not paid; and where the time before 4.00am forms part of the employee’s usual 7.6 rostered hours (ie. the daily 8 hours is only met when the time worked before 4.00am is included) in which case it accepts that work on that day is paid as an early morning shift.

[10] The Union sought to rely on evidence that there are no written or published rosters and that, for some years, Inghams has requested employees to start shift before 4.00am and on short notice (just prior to the end of the prior shift or after concluding the prior shift and before starting the next shift). Inghams opposed this evidence on the grounds that the clause was not ambiguous and did not bring evidence in response.

Consideration

[11] The principles that apply to the interpretation of an enterprise agreement were summarised by a Full Bench of the Commission in AMWU v Berri Pty Ltd,2 drawing on the earlier Full Bench decision in AMIEU v Golden Cockerel Pty Ltd.3 The Full Bench in Berri affirmed that the interpretation of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a dispute over the interpretation of an enterprise agreement will turn on the language of the agreement, having regard to its context and purpose. Context might appear from the text of the agreement as a whole, the place and arrangement of the disputed provision in the agreement, and the legislative framework under which the agreement was made.4

[12] The Union applicant rests its argument on the meaning of “early morning shift”, being expressly defined at sub-clause 4.3(2)(a) of the Agreement. However this definition is not to be read in isolation. The disputed provision lives within Part 4 of the Agreement, which regulates the hours of work, breaks and overtime for all employees.

[13] Part 4 begins with clause 4.1, which provides the number of ordinary hours to be worked by all employees and averaged over a work cycle. Clause 4.1 also provides for the “arrangement” of ordinary hours in terms of the number of ordinary hours that may be worked in any given day and across a specified number of days per week which can be modified by consultation and agreement. There are also two sub-clauses which provide for the ordinary starting and finishing times to be modified in circumstances of hot weather and Christmas/New Year, respectively.

[14] Clause 4.2 is titled “Day Workers” and provides that ordinary hours for day workers shall be worked between the specified span of hours and on the specified days of the week (that is, between the hours of 4.00am and 6.00pm (or 7.00pm), Monday to Saturday).

[15] Clause 4.3 is titled “Shift Work” and commences with the words “The following shift work provisions will apply” before setting out, at sub-clauses (1) to (6), a series of provisions which: provide that a shift worker may work ordinary hours of work on any day of the week; define afternoon shift and night shift by finishing time; define early morning shift by commencing time; and provide entitlements to payment for working afternoon shift, night shift, early morning shift, on Saturdays, Sundays and public holidays. The definitions of night shift, afternoon shift and early morning shift are expressly “for the purposes of this provision” and, relevantly, “early morning shift” is defined as “any shift commencing at or after 2.00am and before 4.00am”. The drafters have expressed all entitlements under clause 4.3 as owing to a “shift worker” or “shift work employee” (not separately defined terms). Relevantly, shift allowances are expressed as payable to “A shift worker whilst on afternoon or early morning shift” and “A shift worker whilst on night shift”.5

[16] Clause 4.4 follows, titled “Rosters”. It plainly provides:

“(1) Rosters shall specify the commencing and finishing times of ordinary working hours of employees.”

[17] Sub-clause 4.4(2) goes on to provide for the possibility of variation to the rostered times of commencing and finishing shifts but only “once having been determined”. Although the Agreement does not expressly say whose determination or how such determination of the rosters is reached, Inghams has the ultimate responsibility for determining variations because, in the absence of agreement, rosters may be varied on 7 days’ notice by Inghams. This sub-clause 4.4(2) concludes by providing for circumstances (such as breakdown of plant or equipment) when ordinary starting and finishing times may be changed without payment of overtime.

[18] Overtime is then expressly provided at clause 4.5, commencing with an acknowledgement that overtime will be required to meet production demands given the nature of the industry, and Inghams may require any employee to work “reasonable overtime” at overtime rates. It plainly provides that:

“(2) (a) All work performed outside of ordinary time shall be termed overtime.”

[19] Clause 4.5 continues by providing a rate of pay or equivalent time off for overtime worked outside of ordinary time, as well as minimum overtime payments. By sub-clause 4.5(3), Inghams is required to “endeavour” to give at least one hour’s notice of the requirement to work overtime. The Agreement does not specify but also does not preclude overtime being worked before or after ordinary working hours. Elsewhere in the Agreement there is support for it being within the parties’ express contemplation that overtime may be worked before ordinary hours commence. For example, at sub-clause 3.5(2)(b) a meal allowance is payable to certain employees who (among other things) are “required to work on any day for more than one completed hour’s overtime before or after working ordinary hours without having been notified of such overtime the day or shift prior..”.

[20] The first question posed by the parties in resolution of this dispute asks the Commission to consider whether an early morning shift allowance under sub-clause 4.3(2)(a) is required to be paid to a class of employee who commences work before 4.00am and whose rostered hours fall within the span of day work.

[21] The entitlement to payment of the shift allowances only arises under sub-clause 4.3(3). In turn, only a “shift worker” as distinct from a “day worker” is entitled to the shift allowances. In the absence of any express definition of these terms, meaning may be taken from the surrounding text – in this case, “4.2 – Day Workers” and “4.3 – Shift Work”. By the terms of clauses 4.2 and 4.3, the distinction between a “shift worker” and “day worker” turns on the times of commencing and finishing ordinary working hours and the days on which ordinary working hours may be worked.

[22] The question itself assumes that there is a roster, and that the rostered hours fall wholly within the day work span. Pursuant to clause 4.2 of the Agreement, the ordinary hours of a day worker are to be worked within a span that is between 4.00am and 6.00pm or 7.00pm, Monday to Saturday. In the scenario posed by the agreed question, any time worked before 4.00am is outside of the ordinary hours for day workers.

[23] All work performed outside of ordinary time is overtime and subject to overtime rates (or the equivalent time off) in accordance with clause 4.5. I consider the better view is that the overtime payment provisions are read in accordance with the prefacing words at sub-clause 4.5(1), in that reasonable overtime may be required by Inghams (including on short notice) and only where Inghams so requires then the remainder of the clause (including entitlement to payment) applies. It follows however that there may be circumstances where a request to work overtime may be refused by an employee because it is not reasonable.

[24] For completeness, I am satisfied that the drafters of the Agreement specifically provided conditions for when overtime is worked before working ordinary hours and therefore that the conclusion is consistent with the Agreement when read as a whole. As noted above, there are some exceptions in the Agreement, whereby commencing times may be changed without payment of overtime, however those exceptions do not form part of the scenario posed in the agreed questions for determination.

Resolution

[25] I consider that an analysis of the text of the Agreement in this case is sufficient to determine the agreed questions. The evidence before the Commission does not establish a common understanding of the provisions in question and is not otherwise of interpretative significance in the context of the agreed questions. Further, in the absence of the necessary consent pursuant to sub-clause 6.3(2)(b), I consider it would be outside of jurisdiction to go beyond the agreed questions and make findings about the practical application of these provisions by way of arbitration.

[26] For the above reasons, I determine the answers to the questions posed by the parties are:

Question 1: No, if an employee commences work before 4.00am and their rostered hours fall within the span of day work then they are not required to be paid an early morning shift allowance.

Question 2: Yes, the class of employee defined by question 1 is able to be paid overtime for the time worked before 4.00am in accordance with clause 4.5.

DEPUTY PRESIDENT

Appearances:

Mr M de Rooy of the Applicant

Ms R Tolley of the Respondent.

Hearing details:

2021.
Melbourne (by video).
22 February.

Printed by authority of the Commonwealth Government Printer

<PR730074>

Annexure A

PART 4 – HOURS OF WORK, BREAKS AND OVERTIME

 4.1 Hours of Work

(1) The ordinary hours of work shall be an average of 38 per week to be worked on the basis of 228 hours within a work cycle not exceeding 42 consecutive days or such other work cycle as may be agreed between the Company and the majority of employees in the plant or work section or sections concerned.

(2) In any arrangement of ordinary hours where the ordinary working hours are to exceed eight and not more than ten hours on any day, so that ordinary hours are worked on an average of four (4) days per week for full-time employees, the Company shall consult with affected employees prior to the commencement of such changes to the arrangement of hours. The Company shall endeavour to commence such consultation twelve weeks prior to the commencement of the changes.

(3) Where the ordinary hours in subclause (2) are to be introduced for the despatch work area at the Lyndhurst distribution centre, at first instance despatch employees engaged on or after 1 April 2014 will be required to work such rosters, subject to these employees having the appropriate skills to meet operational requirements. If staffing requirements are such that additional employees are required, despatch employees engaged prior to 1 April 2014 may be required to work the ordinary hours as set out in subclause (2), above.

(4) In any arrangement or ordinary hours where the ordinary hours are to exceed ten and not more than twelve hours on any day, the arrangement of hours shall be subject to agreement between the Company and the majority of employees in the plant or work section or sections concerned.

(5) When the temperature for the following day is forecast to be 32 degrees Celsius or higher, the ordinary starting time for employees may be advanced by the Company up to 30 minutes.

(6) During December each year the Company and employees may by mutual agreement arrange ordinary working hours to allow employees to have have an earlier finish time than normal on the last working day before Christmas and New Year.

4.2 Day Workers

The ordinary hours for day workers shall be worked between the hours of 4:00am and 6:00pm, Monday to Saturday. Provided that, where the hours of work are arranged so that ordinary working hours exceed eight hours and not more than ten hours per day, so that ordinary hours are worked on an average of four (4) days per week for full-time employees, the ordinary hours for day workers shall be worked between the hours of 4:00am and 7:00pm, Monday to Saturday.

4.3 Shift Work

The following shift work provisions will apply:

(1) Hours

The ordinary hours of work of a shift worker may be worked on any or all of the days of the week.

(2) Definitions

(a) For the purpose of this provision:

“Afternoon shift” means any shift finishing after 6.00 p.m. and at or before midnight. Where the hours of work are arranged so that ordinary working hours exceed eight hours and not more than ten hours per day, “afternoon shift” means any shift finishing after 7.00 p.m. and at or before 1.00 a.m.

“Night shift” means any shift finishing subsequent to midnight and at or before 8.00 a.m. Where the hours of work are arranged so that ordinary working hours exceed eight hours and not more than ten hours per day, “night shift” means any shift finishing subsequent to 1.00am and at or before 9.30 a.m., excluding a shift within the definition of “early morning shift”.

“Early morning shift” means any shift commencing at or after 2.00am and before 4:00am.

(3) Shift allowances

(a) A shift worker whilst on afternoon or early morning shift shall be paid at the ordinary rate prescribed for a full-time day worker plus 15% per shift.

(b) A shift worker whilst on night shift shall be paid at the ordinary rate prescribed for a fulltime day worker plus 25% per shift.

(4) Saturday shifts

For shift work employees engaged as at the date the agreement is made, the minimum rate to be paid to a shift worker for work performed between midnight on Friday and midnight on Saturday shall be time and a half. Such extra rate shall be in substitution for and not cumulative upon the shift allowances - prescribed in subclause (3) above. Provided that, where a shift work employee volunteers to work ordinary time on a Saturday that would fall within the shift work span of hours defined in subclause (2) above, the shift work allowances in subclause (3) shall apply in addition to the rate of time and a quarter, to a maximum combined rate of time plus 40%. Note: all Lyndhurst distribution centre shift work employees engaged as at the date the agreement is made shall be paid time and a half for work performed on a Saturday.

For shift work employees engaged after the date the agreement is made, ordinary time on a Saturday that would fall within the shift work span of hours defined in subclause (2) above, shall be paid the shift work allowances in subclause (3) in addition to the rate of time and a quarter, to a maximum combined rate of time plus 40%.

(5) Sunday and public holiday shifts

(a) Shift workers for all time worked on a Sunday or Public Holiday shall be paid:

Sunday: two (2) times the ordinary rate (i.e. no shift allowance);

Public Holiday: two and a half (2.5) times the ordinary rate (i.e. no shift allowance).

(b) Where a shift falls partly on a Sunday, that shift, the major portion or which falls on the Sunday, shall be regarded as the Sunday shift, for the purposes of payment of the Sunday.

(6) (a) Except where otherwise provided, the rates in this clause are not cumulative. Where two or more allowances may apply to a particular situation then only the highest shift allowance shall be paid. For example, the afternoon and night shift allowances do not apply to Sunday or Public Holiday shifts.

(b) The payments prescribed by this clause shall stand alone and shall not be for any other purposes of this agreement.

4.4 Rosters

(1) Rosters shall specify the commencing and finishing times of ordinary working hours of employees.

(2) The times of commencing and finishing shifts once having been determined may be varied by agreement between the Company and the majority of employees concerned to suit the circumstances of the establishment or in the absence of agreement by seven days’ notice of alteration given by the Company to the employees, provided however, that the ordinary starting and finishing times may be changed without payment of overtime in the case of breakdown of plant or equipment or other exceptional circumstances or by agreement.

(3) Where the Company introduces a roster where the ordinary working hours are to exceed eight and not more than ten hours on any day or shift, so that ordinary hours are worked on an average of four (4) days per week for full-time employees, the Company will provide employees with at least four weeks’ notice of such roster change.

(4) In the event that the Company makes the decision to revert to a roster where the ordinary working hours are not to exceed eight on any day or shift, the Company will endeavour to provide employees with at least four weeks’ notice of the roster change. In exceptional circumstances it may not be reasonably practicable to provide employees with four weeks’ notice. In that event, the change will be made within a timeframe agreed between the Company and the Union, or in the absence of agreement, by two weeks’ notice from the Company.

4.5 Overtime

(1) It is recognised that given the nature of the industry, overtime will be required to meet production demands. The Company may require any employee to work reasonable overtime at overtime rates and such employee shall work overtime in accordance with such requirement.

(2) (a) All work performed outside of ordinary time shall be termed overtime.

(b) The rate of pay for overtime shall be time and a half for the first two hours and double time thereafter. Provided that where the Company and the individual employee concerned agree the equivalent time off (1:1) at a time agreed by the parties may be granted in lieu of payment.

(c) An employee required to work overtime on a Saturday shall receive a minimum of four hours work or shall receive four hours pay at the appropriate penalty rate.

(d) An employee who has left the Company’s premises and is recalled to work overtime, whether notified before the employee has left the Company’s premise or not shall be paid a minimum of three hours at the appropriate rate, provided that such employee presents for work as required.

(3) The Company will endeavour to give at least one hour’s notice of the requirement to work overtime. If an employee is requested to work for one hour then they will be paid for the hour, whether the entire hour is worked or not. The employee will work for the hour if required by the Company.

(4) Rest Period after Overtime

(a) An employee (other than a casual) who works so much overtime between the termination of his ordinary work on one day and the commencement of his ordinary work on the next day that he has not had at least ten consecutive hours off duty between those times shall, subject to this subclause, be released after the completion of such overtime until he has had ten consecutive hours off duty without loss of pay for ordinary working time occurring during such absence.

(b) If on the instructions of his Company such an employee resumes or continues work without having had such ten consecutive hours off duty he shall be paid an additional amount of ordinary time until he is released from duty without loss of pay for ordinary working time occurring during such absence.

(c) Overtime worked in the circumstances specified in subclause 2(e) of this clause shall not be regarded as overtime for the purpose of this subclause.

(d) The provisions of this subclause shall apply in the case of shift workers as if eight hours were substituted for ten hours when overtime is worked:

(i) for the purpose of changing shift rosters; or

(ii) where a shift worker does not report for duty and a day worker is required to replace such shift worker; or

(iii) where a shift is worked by arrangement between the employees themselves.

 1   Clause 1.2 of the Agreement; see also Inghams Enterprises Pty Limited T/A Inghams Group Limited [2017] FWCA 2444.

 2   [2017] FWCFB 3005 (Berri).

 3   [2014] FWCFB 7447 (Golden Cockerel).

 4   Berri at paragraph 114 and Golden Cockerel at paragraph 41.

 5   Sub-clause 4.3(3) of the Agreement.