Warrigal Care T/A Warrigal
[2023] FWC 2881
•1 NOVEMBER 2023
| [2023] FWC 2881 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees
Warrigal Care T/A Warrigal
(AG2023/3452)
| Aged care industry | |
| COMMISSIONER P RYAN | SYDNEY, 1 NOVEMBER 2023 |
Application for an order relating to instruments covering new employer and transferring employees.
Introduction and Background
This decision concerns an application by Warrigal Care T/A Warrigal (Applicant) for orders pursuant to s.318 and s.319 of the Fair Work Act 2009 (FW Act) (Application).
The Applicant provides aged care services, both residential care and home services, throughout the Australian Capital Territory and New South Wales. The Applicant is covered by the Warrigal and NSW Nurses and Midwives’ Association, Australian Nursing and Midwifery Federation NSW Branch, Health Services Union NSW/ACT/QLD Branch and the Australian Nursing and Midwifery Federation – Australian Capital Territory Branch Enterprise Agreement 2022[1] (Warrigal Agreement).
St Andrews Village (St Andrews) is a provider of residential care services throughout the Australian Capital Territory. The Applicant has entered into an arrangement with St Andrews to acquire its residential care home, community village and group social.
On 6 November 2023, the employees of St Andrews will be employed by Warrigal.
The Applicant seeks orders from the Fair Work Commission (Commission) relating to employees of St Andrews who will be employed by the Applicant on 6 November 2023 (Transferring Employees) and whose employment is covered by the St Andrews Village Enterprise Agreement 2017-2020[2] (St Andrews Agreement).
The Applicant seeks orders in the following terms:
1. An order pursuant to section 318(1)(a) the Act that the St Andrews Village Enterprise Agreement 2017 – 2020 (“St Andrews Village Enterprise Agreement”) will not cover:
a) Warrigal; or
b) The transferring employees who will perform, or are likely to perform, the transferring work for Warrigal (St Andrews Village) (i.e. transferring employees).
2. An order pursuant to section 319(1)(a) of the Act that the St Andrews Village Enterprise Agreement will not cover any new non-transferring employees who will perform, or are likely to perform, the transferring work for Warrigal.
3. An order pursuant to section 318(1)(b) of the Act that the Warrigal and NSW Nurses and Midwives’ Association, Australian Nursing and Midwifery Federation NSW Branch, Health Services Union NSW/ACT/QLD Branch and the Australian Nursing and Midwifery Federation – Australian Capital Territory Branch Enterprise Agreement 2022 (AG2022/4631) (“Warrigal Enterprise Agreement”) will cover the Transferring Employees.
The Application included detailed information comparing the St Andrews Agreement to the Warrigal Agreement, as well as the steps it had taken to consult with the Transferring Employees.
Upon the matter being allocated to my Chambers, the matter was listed for hearing on 27 October 2023 and directions were issued for the parties to file any material and submissions in support of, or in opposition to, the Application. I also directed the Applicant to provide a copy of the notice of listing, the directions and the Application to any affected employee and employee organisation.
The Applicant filed additional information regarding the steps it had taken to consult with the Transferring Employees, including a copy of a presentation.
There were no submissions or material filed by any affected employees or employee organisations.
The Applicant and the Health Services Union (HSU) appeared at the hearing. During the hearing of the matter, the Applicant confirmed that it did not seek an order pursuant to s.319 of the FW Act and relied on the material filed.
The HSU stated that it had consulted with its members and that it supported the Application.
Relevant Legislation
Section 313 of the Act relevantly provides:
313 Transferring employees and new employer covered by transferable instrument
(1) If a transferable instrument covered the old employer and a transferring employee immediately before the termination of the transferring employee’s employment with the old employer, then:
(a) the transferable instrument covers the new employer and the transferring employee in relation to the transferring work after the time (the transfer time) the transferring employee becomes employed by the new employer; and
…
(3) This section has effect subject to any FWC order under subsection 318(1).
Sections 317 and 318 of the Act relevantly provide:
317 FWC may make orders in relation to a transfer of business
This Division provides for the FWC to make certain orders if there is, or is likely to be, a transfer of business from an old employer to a new employer.
318 Orders relating to instruments covering new employer and transferring employees
Orders that the FWC may make
(1) The FWC may 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.
Who may apply for an order
(2) The FWC may make the order only on application by any of the following:
(a) the new employer or a person who is likely to be the new employer;
(b) a transferring employee, or an employee who is likely to be a transferring employee;
(c) if the application relates to an enterprise agreement—an employee organisation that is, or is likely to be, covered by the agreement;
(d) if the application relates to a named employer award—an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (b).
Matters that the FWC must take into account
(3) In deciding whether to make the order, the FWC must take into account the following:
(a) the views of:
(i)the new employer or a person who is likely to be the new employer; and
(ii)the employees who would be affected by the order;
(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment;
(c) if the order relates to an enterprise agreement—the nominal expiry date of the agreement;
(d) whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace;
(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;
(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;
(g) the public interest.
Restriction on when order may come into operation
(4) The order must not come into operation in relation to a particular transferring employee before the later of the following:
(a) the time when the transferring employee becomes employed by the new employer;
(b) the day on which the order is made.
Consideration
In deciding whether to make an order pursuant to s.318(1) of the FW Act, the Commission must take into account the matters set out in s.318(3).
Before turning to those matters, I have had regard to all of the materials before the Commission and I am satisfied as to the following:
That there will be, or is likely to be, a transfer of business from St Andrews to the Applicant (ss.311(1) and 317 of the FW Act);
That the employees of St Andrews who will be, or are likely to be, employed by the Applicant will be transferring employees (s.311(2) of the FW Act);
That the St Andrews Agreement covers St Andrews and the persons likely to be transferring employees (s.313(1) of the FW Act);
That the St Andrews Agreement is a transferable instrument (s.312(1) of the FW Act); and
That the Applicant as the new employer, or a person who is likely to be the new employer, of the transferring employees can make an application for the order sought (s.318(2)(a) of the FW Act).
I now turn to a consideration of the matters set out in s.318(3) of the FW Act.
Views of the new employer – s.318(3)(a)(i)
The Applicant is the new employer, or a person who is likely to be the new employer, who seeks, and is supportive of, the proposed Order. This weighs in favour of making the proposed Order.
Views of the employees who would be affected by the order – s.318(3)(a)(ii)
The directions issued by my Chambers sought the views of the transferring employees. The HSU consulted with its members and stated it was supportive of the making of the proposed orders. No employees sought to provide their views directly to the Commission. This weighs in favour of making the proposed orders.
Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment – s.318(3)(b)
The rates of pay under the Warrigal Agreement are between 2.97% and 15.76% more beneficial than the St Andrews Agreement and will increase by 3% from the first full pay period to commence on or after 1 October 2024.[3] Furthermore, it is a term of the Warrigal Agreement that the rates of pay do not fall below the corresponding rate in the Public Health System Nurses’ and Midwives’ (State) Award (NSW) for the following classifications: Registered Nurses, Clinical Nurse Specialist, Nurse Practitioner, Clinical Nurse Consultant and Clinical Nurse Educator.[4]
The Warrigal Agreement also provides for more favourable rates for allowances, weekend penalty rate loadings for aged care employees, and annual leave entitlements for nursing employees.
Having regard to the terms and conditions of the Warrigal Agreement, I am satisfied that the transferring employees will not be disadvantaged overall if the proposed Orders are made. This weighs in favour of making the proposed orders.
The nominal expiry date of the agreement – s.318(3)(c)
The nominal expiry date of the St Andrews Agreement is 30 June 2020. The nominal expiry date of the Warrigal Agreement is 30 June 2025. I consider this a neutral factor in relation to the making of the proposed orders.
Whether the transferable instrument would have a negative impact on the productivity of the new employer’s workplace – s.318(3)(d)
The Applicant submitted that the operation of different enterprise agreements within the same employee cohort may lead to dissatisfaction amongst employees resulting in a negative impact on the productivity of the Applicant’s workplace. Furthermore, the Applicant submitted the requirement to administer two enterprise agreements will impose an administrative burden on the Applicant.
I accept these submissions and that this weighs in favour of making the proposed orders.
Whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer – s.318(3)(e)
The Applicant submitted that it would suffer economic disadvantage if it were required to administer two different enterprise agreements which will create complexity within its management and operations functions.
I accept that if the proposed orders are not made there is potential for the Applicant to suffer economic disadvantage arising from the administration of two different enterprise agreements. This weighs in favour of the making the proposed orders.
The degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer – s.318(3)(f)
Having regard to the materials before me, I am satisfied that there is limited synergy between the St Andrews Agreement and the Warrigal Agreement and that this weighs in favour of making the proposed orders.
The public interest – s.318(3)(g)
The Applicant submitted that the making of the proposed Order are in the public interest as they will ensure there is a harmonious workforce at St Andrews Village, which will reduce the likelihood of any impact to the care and support provided to residents.
Having regard to the material before me, I am not of the view that there are public interest reasons weighing against making the proposed orders.
Conclusion
Having considered the matters required by s.318(3) of the FW Act and all the materials before me, I am satisfied that it is appropriate that the Application be granted. An Order PR767849 to that effect will be issued in conjunction with this decision.
In accordance s.318(4) of the FW Act, the Order shall take effect from the later of the following:
a.the time when the transferring employees become employed by the Applicant; or
b.the day on which the Order is made.
COMMISSIONER
Appearances:
M. Healey for the Applicant.
L. Hampson for the Health Services Union.
Hearing details:
2023.
Sydney (via Microsoft Teams video-link):
27 October.
[1] AE518395.
[2] AE428783.
[3] Warrigal Agreement, Schedule A.
[4] Ibid.
Printed by authority of the Commonwealth Government Printer
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