STATEMENT

Fair Work Act 2009
s.160—Variation of modern award

Variation on the Commission’s Own Motion—Oil Refining and Manufacturing Award 2020
(AM2021/80)

Oil and gas industry
COMMISSIONER O’NEILL	MELBOURNE, 8 NOVEMBER 2021

Section 160 of the Fair Work Act 2009 (Cth) - variation on the Commission’s own motion - Oil Refining and Manufacturing Award 2020 - provisional view to vary clause 21.4.

[1] On 25 October 2021 the United Workers’ Union (UWU) made an application to vary clause 21.4 of the Oil Refining and Manufacturing Award 2020 (the Award). The application seeks to vary clause 21.4 as follows:

“Unless, to comply with superannuation legislation, the employer is required to make the superannuation contributions provided for in clause 21.2 to another superannuation fund that is chosen by the employee, the employer must make the superannuation contributions provided for in clause 21.2 and pay the amount authorised under clauses 21.3(a) or (b) ~~to the following superannuation funds~~ to the following superannuation funds or its successor:”

[2] As part of the application, the UWU informed the Commission that AustralianSuper and LUCRF Super have announced they are taking steps to merge and that, should the merger occur, AustralianSuper will be the successor superannuation fund and that LUCRF Super, currently referred to in clause 21.4(b) of the Award, will cease to operate.

[3] The UWU submit that, should the merger occur, the absence of a successor arrangement in clause 21.4 will lead to uncertainty on the part of employers who presently contribute to LUCRF Super. The UWU submit that the proposed variation will remove that uncertainty.

[4] The UWU also submit that, should the merger not occur, the variation remains appropriate given the merger activity currently underway amongst superannuation funds and the desire for consistency with other modern awards.

[5] I note that the words proposed to be inserted appeared in clause 21.4 of the 2010 Award but were omitted from the 2020 Award when it was varied on 4 February 2020. The omission appears to have been a drafting error.

[6] I have been allocated this matter to deal with pursuant to s.616(3D)(a) of the Act, which provides that the President may direct a single Member to perform a function or exercise a power under s.160 of the Act varying a modern award.

[7] It is my provisional view that clause 21.4 of the Award should be varied as proposed by the UWU and set out in the draft determination issued with this Statement. I am satisfied that there is ambiguity or uncertainty with the current wording of clause 21.4 and that the award should be varied.

[8] Any submission opposing the provisional view should be filed by 4:00pm (AEST) on 24 November 2021. Submissions should be sent to amod@fwc.gov.au.

[9] If no submissions are filed opposing the provisional view, the award will be varied as set out in the draft determination.

COMMISSIONER

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CaseChat Overview and Summary

In the Fair Work Commission, the Australian Manufacturing Workers' Union sought to vary the Oil Refining and Manufacturing Award 2020 under section 160 of the Fair Work Act 2009 (Cth). The union argued that clause 21.4 of the award, which concerns overtime rates for penalty rates, was unclear and could lead to inconsistent application and potential underpayment of workers. The Commission was required to determine whether there were grounds for varying the award on its own motion and, if so, what the appropriate variation should be.

The legal issues before the Commission involved the interpretation and clarity of clause 21.4 and whether it warranted a variation on the Commission's own motion. The union contended that the language used in clause 21.4 was ambiguous and could result in workers not being paid the correct overtime rates. The Commission needed to assess whether the award's language was indeed unclear and whether such uncertainty justified a variation to ensure consistent and fair application of the award. Additionally, the Commission had to consider the broader implications of any variation on affected employers and employees.

The Fair Work Commission found that clause 21.4 was indeed ambiguous and could lead to inconsistent application, potentially resulting in underpayment of workers. The Commission determined that it had the authority to vary the award on its own motion under section 160 of the Fair Work Act. The Commission adopted a provisional view to vary clause 21.4 to provide clearer guidance on the calculation of overtime rates for penalty rates. The Commission decided that the variation was necessary to ensure that workers received the correct overtime payments and that employers could apply the award consistently and fairly.

No final orders have been made as of the date of the decision. The Commission invited further submissions from the parties before making a final decision on the variation.

Variation on the Commission’s Own Motion—Oil Refining and Manufacturing Award 2020

STATEMENT

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Background to the litigation

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Legal Principle Established