Ventia Utility Services Pty Limited T/A Ventia

[2021] FWC 4778

[2021] FWC 4778

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees

Ventia Utility Services Pty Limited T/A Ventia
(AG2021/5512)

Ventia Utility Services Pty Limited T/A Ventia
(AG2021/5513)

Electrical power industry
COMMISSIONER MIRABELLA	MELBOURNE, 6 AUGUST 2021

Application for an order relating to instruments covering new employer and transferring employees.

[1] Ventia Utility Services Pty Ltd (Ventia) has applied for orders pursuant to s 318 of the Fair Work Act 2009 (the Act) in relation to the EnergyAustralia Yallourn Enterprise Agreement 2020 1 (the EnergyAustralia Agreement), an enterprise agreement that applies to EnergyAustralia Pty Ltd (EnergyAustralia). The EnergyAustralia Agreement is a ‘transferrable instrument’ as defined in s 312 of the Act.

[2] Ventia is seeking orders from the Fair Work Commission that would have the effect that:

i) The EnergyAustralia Agreement would not cover Ventia or any employee whose employment ceases with EnergyAustralia Yallourn Pty Ltd and within 3 months of the date of cessation commences employment with Ventia.

ii) An employee who commences with Ventia following the operation of the above order will be covered by either two of the following enterprise agreements as are relevant to that employee:

•  Ventia Utility Services Pty Ltd CFMEU and AMWU Yallourn Power Station & Open Cut Mine 2020 2; or

•  Ventia Utility Services Pty Ltd ETU Yallourn Power Station & Open Cut Mine 2020 3 (the Ventia Agreements).

iii) The orders will come into operation on the day on which the order is made.

[3] Directions were issued by the Commission on 9 July 2021 allowing for submissions and materials to be filed in relation to the application by Ventia, any transferring employees and the unions that are a party to the Agreement, the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU), the Construction, Forestry, Maritime, Mining and Energy Union, the Australian Municipal, Administrative, Clerical and Services Union, The Australian Workers’ Union and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia.

[4] Ventia filed submissions which were accompanied by witness statements from two of its employees, Lindsay Fawcett the Alliance Manager and LeeAnn Elliston an Administration Officer.

Background

[5] EnergyAustralia operates a power station and open cut mine in the La Trobe Valley. It has an asset management and maintenance alliance with Ventia commonly referred to as ‘The Yallourn Alliance’. Under the existing arrangements, casual maintenance staff are usually employed by EnergyAustralia to work on scheduled outages and to supplement short term labour shortages. Permanent staff are employed by Ventia. Scheduled outages usually occur on an annual basis, during which up to 400 casual employees are engaged. Prior to the next scheduled outage, to commence on 1 September 2021, EnergyAustralia and Ventia are of the view that operations under the Yallourn Alliance would be more efficient if all casual employees were to be engaged by Ventia.

[6] Due to the nature of the work performed and workforce requirements, the number of ‘transferring employees’ has vacillated from the time the application was lodged. At the Mention/Directions hearing on 29 July 2021, Ventia advised the most recent number of transferring employees was 38.

Statutory Provisions

[7] Section 318(1) of the Act provides that the Commission may, on application by a person or organisation identified in s 318(2), 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.”

[8] The power to make orders under s 318 is premised on the Commission being satisfied that there has been, or that there is likely to be, a transfer of business for the purpose of s 311 of the Act. I am satisfied that there will likely be a transfer of business from EnergyAustralia to Ventia for the following reasons.

[9] First, the 38 employees of EnergyAustralia that are intended to be terminated prior to or on 1 September 2021, being the date of the next proposed scheduled outage, will within 3 months of termination become employees of Ventia (s 311(1)(a) and (b)). Secondly, having regard to the information in the application, I consider that the work performed by the transferring employees for EnergyAustralia is the same or substantially the same as the work they will perform for Ventia (s 311(1)(c)). Finally, there is a ‘connection’ between EnergyAustralia and Ventia as described in s 311(4), because EnergyAustralia will be outsourcing work it performs to Ventia (s 311(1)(d)).

[10] Next it will be necessary for me to consider s 318(3), which states that, in deciding whether to make an order under s.318(1), the Commission must take certain matters into account.

The views of the new employer and affected employees – s 318(3)(a)

[11] The view of Ventia as the new proposed employer, is that the application should be granted. It contends that there will benefits from standardising the terms and conditions of transferring employees to those of Ventia’s current workforce, in that the standardisation will create uniform employment conditions and thus removing a source of potential workplace disputation.

[12] LeeAnn Elliston of Ventia canvassed the views of EnergyAustralia staff who would be transferring employees. She provided comparisons and took questions of the relevant provisions in the EnergyAustralia Agreement and the Ventia Agreements. The collated views of the employees indicate that a majority support the application.

[13] Additionally, no transferring employees responded to the Directions issued by the Commission.

[14] The AMWU (by emails dated 29 June 2021 and 26 July 2021), the CFMEU (by emails dated 30 June 2021 and 26 July 2021) and ETU (by email dated 27 July 2021) have all consulted with their members employed by EnergyAustralia who will be the transferring employees, and advised of collective support for the applications.

[15] The views of the new proposed employer and the views of the affected employees, which are in support of the applications, weigh in favour of granting the orders sought.

Whether any employee will be disadvantaged – s 318(3)(b)

[16] The Commission must consider whether any of the transferring employees will be disadvantaged by the order in relation to their terms and conditions of employment. Ventia has submitted that depending on various shifts, lower loadings may in some instances apply under the Ventia Agreements. Further, that superannuation contributions under the EnergyAustralia Agreements are 12% and 10.5% under the Ventia Agreements but that under the latter, weekly rate base of pay plus allowances is 0.5% higher and that employees receive weekly redundancy payments to the relevant severance funds and long service payments to the Construction Portable Long Service Leave Fund.

[17] The absence of any demonstrable disadvantage weighs in favour of granting the orders sought.

The nominal expiry date of the agreement – s 318(3)(c)

[18] If the application under s 318 relates to an enterprise agreement, the Commission must consider the nominal expiry date of the agreement. The EnergyAustralia Agreement nominal expiry date is 1 February 2023. The nominal expiry date for the Ventia Agreements is 31 January 2024. I consider the nominal expiry date of the agreements to be a neutral factor.

Negative impact on productivity – s 318(3)(d)

[19] The Act requires the Commission to consider whether the transferrable instrument would have a negative impact on the productivity of the new employer’s workplace. Ventia submitted that if the application were not granted, there would be a negative impact on productivity because two different sets of employment conditions would apply to employees working side by side performing the same work tasks and that this would lead to a sense of unfairness. They contend that the confusion surrounding existing arrangements during scheduled outages would continue. This weighs in favour of granting the orders sought.

Whether the new employer will incur significant economic disadvantage - s 318(3)(e)

[20] Ventia submits that if the orders sought are not made, it would suffer economic disadvantage due to the additional workload of administering two sets of enterprise agreements for the same category of employees. They further contend that they will need to employ an additional payroll administrator during outages. This weighs in favour of granting the orders sought.

The degree of business synergy - s 318(3)(f)

[21] The Commission is required to consider the degree of business synergy between the transferrable instrument and any workplace instrument that already covers the new employer. While the terms of the Ventia Agreements on balance may be comparable to the EnergyAustralia Agreement, there are differences that would be problematic if both agreements applied to the same class of employees. To that extent, there is a lack of synergy between the transferable instrument and the existing Ventia Agreements which cover Ventia and its employees. This weighs in favour of the orders sought.

Public Interest – s318(3)(g)

[22] Section 318(3)(g) requires the Commission to consider ‘the public interest’. I am satisfied that it is not contrary to the public interest to grant the orders sought by Ventia. This weighs in favour of the orders sought.

Conclusion

[23] Having considered the application and supporting material and taking into account each of the requirements in s 318(3), I am satisfied that the orders sought should be granted.

[24] An order 4 will be separately issued with this Decision and will take effect on 6 August 2021.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

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 1   AE508007

 2   AE508755

 3   AE508818

 4   PR732502