Uniting (NSW.ACT) T/A Uniting
[2022] FWC 2887
•1 NOVEMBER 2022
| [2022] FWC 2887 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
Uniting (NSW.ACT) T/A Uniting
(AG2022/4222)
| COMMISSIONER MCKINNON | SYDNEY, 1 NOVEMBER 2022 |
Application that transferable instrument not cover transferring employees
Uniting (NSW.ACT) (“Uniting”) is a not-for-profit community organisation delivering services on behalf of the Uniting Church, Synod of New South Wales and the Australian Capital Territory. This includes services in the aged care sector, in both residential aged care and home and community care.
On 29 June 2022, Uniting purchased the business known as Crookwell/ Taralga Aged Care Limited (“CTAC”), which operates three sites in New South Wales – two in residential aged care (Sunset Lodge and Viewhaven Lodge) and one providing respite, personal care, domestic assistance, social support and transport (Upper Lachlan Site) (together, the “CTAC Sites”). It is expected that Uniting will become the aged care provider at the CTAC Sites from today (1 November 2022).
81 employees are employed at the CTAC Sites and are covered by the Crookwell/Taralga Aged Care Ltd, NSWNMA and HSU NSW Enterprise Agreement 2017-2020 (“CTAC Agreement”) (the transferring employees). It is intended that the transferring employees will continue working at the CTAC Sites and that their employment will transfer from CTAC to Uniting on or before 7 November 2022.
Uniting also has an enterprise agreement (the Uniting Aged Care Enterprise Agreement (NSW) 2017) that covers work performed at the CTAC Sites. Uniting has applied for orders under section 318 of the Fair Work Act 2009 (the Act) to the effect that the Uniting Agreement, rather than the CTAC Agreement, will cover the transferring employees upon the transfer of business from CTAC to Uniting.
I have decided to grant the application and these are my reasons. Orders will issue separately.
Consideration
Part 2-8 of the Act deals with transfer of business, including the transfer of enterprise agreements from one employer to another in connection with a transfer of business.
Section 311(1) of the Act defines “transfer of business” and section 312 defines the “transferable instruments” that may transfer from one employer to another in connection with a transfer of business. I find that there has been a transfer of business from CTAC to Uniting in relation to the CTAC Sites, on and from today. The CTAC Agreement is a transferable instrument for the purposes of section 312(1)(a).
Sections 317 and 318 of the Act empower the Commission to make orders in relation to a transfer of business, including orders that a transferable instrument will, or will not, cover the new employer in relation to the transferring employee. In deciding whether to make orders under section 318 of the Act, the Commission must take into account a range of factors set out in section 318(3).
The views of Uniting and the employees affected by the order
Uniting purchased the CTAC sites to ensure that it could continue to provide aged care services in regional areas of Crookwell and Taralga, New South Wales. There are particular financial challenges that come from operating aged care sites in regional areas. The introduction of the Uniting Agreement to the CTAC Sites as part of its broader business operations will better support the ongoing viability of the CTAC Sites. Those sites together account for 81 out of its total residential aged care workforce of approximately 5,984. While only a small proportion of the overall Uniting workforce, employees at the CTAC Sites are currently paid through a separate payroll arrangement unique to those sites and administered by a single CTAC employee. The alternative to orders under section 318 is, in Uniting’s submission, for Uniting to make a separate enterprise agreement that covers only the transferring employees. This will add cost to the business and impact the sustainability and operation of the CTAC Sites.
The Health Services Union (HSU) and the Australian Nursing and Midwifery Federation – New South Wales Branch (ANMF NSW Branch)/ New South Wales Nurses and Midwives’ Association (NSWNMA) do not oppose the application but seek undertakings to ensure that employees are not disadvantaged, as discussed further below.
No employee separately provided their views in relation to the application.
Whether any employees would be disadvantaged by the order
Uniting submits that employees will not be disadvantaged by the orders sought. However, the HSU and the ANMF have raised two issues of concern: firstly, in relation to breaks between shifts where overtime is payable, and secondly, in relation to the pay rate and progression for Assistants in Nursing (AIN) who do not hold a Certificate III qualification.
Uniting has given an undertaking to address the second of these issues, which is not opposed by the Unions. Uniting has separately audited its records to demonstrate that in a practical sense, the first issue does not arise in a way that is likely to be disadvantageous to employees. The report and analysis provided by Uniting also confirms that the vast majority of employees will be paid higher rates than those contained in the CTAC Agreement.
The undertaking is as follows:
“The applicant undertakes that no employee, considered to be a transferring employee and employed by Crookwell/ Taralga Aged Care Limited at the date of the signing of this undertaking, will receive a lower rate of pay pursuant to the Uniting Aged Care Enterprise Agreement (NSW) 2017, than the employee would have been paid pursuant to the Crookwell/ Taralga Aged Care Limited, NSWNMA and HSU NSW Enterprise Agreement 2017-2020.”
I am satisfied that when both the terms of the Uniting Agreement are considered overall against the terms of the CTAC Agreement, and now with the undertaking given by Uniting, employees will not be disadvantaged by the orders I propose to make.
The nominal expiry date of the agreement
Both the CTAC Agreement and the Uniting Agreement have a nominal expiry date of 30 June 2020. The parties are presently awaiting a determination in the Aged Care – Work Value Case and at this stage, anticipate that negotiations for a new enterprise agreement for Uniting will commence in early 2023.
Whether the transferable instrument would have a negative impact on productivity at Uniting or cause it significant economic disadvantage
Uniting submits that if the CTAC Enterprise Agreement continues to apply to the transferring employees, this will create disharmony and impact the wellbeing of employees at the CTAC sites due to the inconsistency of terms between the transferring employees and those who are covered by the Uniting Agreement. In this respect, Uniting submits that the Uniting Agreement provides for higher rates of pay and better terms and conditions than the CTAC Agreement.
I accept that incorporation of the CTAC Agreement into Uniting’s payroll, rostering and human resources systems will increase its costs associated with administration of the CTAC Agreement. Uniting estimates these costs at approximately $300,000 per year. This is likely to be an overestimation, including because some of those costs are likely to be offset by lower labour costs associated with the CTAC Agreement. Even so, there are productivity benefits to be gained from greater consistency of application in relation to the Uniting Agreement, as well as the expansion of Uniting’s recently introduced new rostering system (Optima) to the CTAC Sites. In this sense, I accept that the CTAC Agreement would have a negative impact on productivity at Uniting. It may also cause Uniting a degree of economic disadvantage, although whether this would be significant is not established.
Degree of business synergy between the CTAC Agreement and other workplace instruments that already cover Uniting
There is a degree of business synergy between the CTAC Agreement and the Uniting Agreement. Both are underpinned by the Nurses Award 2010, Aged Care Award 2010, Social, Community, Home Care and Disability Services Industry Award 2010 and the Health Professionals and Support Services Award 2010. There are also inherent tensions. The Uniting Agreement reflects Uniting’s ‘Household Model’ approach to the provision of care and its person‑centred approach. This forms the basis of training for Uniting’s employees. The CTAC Agreement does not reflect this model and its continuing operation will mean that the Household Model cannot be extended to the CTAC Sites. Uniting’s training programs will not be able to be used at the CTAC sites. The CTAC Agreement also provides for lower rates of pay for care and nursing staff in comparison to the Uniting Agreement, which Uniting submits makes it more difficult to obtain and retain nursing staff.
The public interest
There is no evidence that making the orders sought would be contrary to the public interest. If anything, the evidence tends to indicate that the application is in the public interest to the extent that it seeks to lift wages and conditions for employees in the aged care sector and improve productivity by reducing unnecessary regulatory burden. Accordingly, I find that granting the application will not be contrary to the public interest.
Conclusion
On balance, I am satisfied that it is appropriate to order that the Uniting Agreement, rather than the CTAC Agreement, will cover employees employed to work at the CTAC Sites.
Order PR747313 will issue separately to this decision.
COMMISSIONER
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