Wesley Mission Queensland Limited

[2024] FWC 2666

[2024] FWC 2666

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.319 - Application for an order relating to instruments covering new employer and non-transferring employees

Wesley Mission Queensland Limited

(AG2024/3323, AG2024/3324, AG2024/3325, AG2024/3326, AG2024/3327)

COMMISSIONER HUNT BRISBANE, 26 SEPTEMBER 2024

Applications for orders relating to instruments covering new employer and non-transferring employees

1. On 29 August 2024, Wesley Mission Queensland Limited (the Applicant) made five applications under s.319(1) of the Fair Work Act 2009 (the Act) seeking orders from the Fair Work Commission (the Commission) that certain enterprise agreements (the Transferable Instruments) cover any non-transferring employees employed by the Applicant who perform, or are likely to perform, the work contained within the classification structures of the Transferable Instruments.

1. The relevant Transferable Instruments the subject of the applications are:

·   the Blue Care/Wesley Mission Brisbane Nursing Employees Enterprise Agreement 2013, approved on 19 April 2013, with a nominal expiry date of 30 June 2016;

·   the Wesley Mission Queensland Allied Health and Community Service Stream Employees Enterprise Agreement 2018, approved on 16 April 2019, with a nominal expiry date of 31 August 2021;

·   the Wesley Mission Queensland Residential Disability Services Care and Support Employees Enterprise Agreement 2019, approved on 17 July 2019, with a nominal expiry date of 3 May 2022;

·   the Wesley Mission Queensland Administration Employees Enterprise Agreement 2018, approved on 7 December 2018, with a nominal expiry date of 30 June 2021; and

·   the Wesley Mission Queensland Care and Support Employees Enterprise Agreement 2018, approved on 16 July 2020, with a nominal expiry date of 30 September 2021.

1. The Transferable Instruments are agreements entered into by The Uniting Church in Australia Property Trust (Q.) T/A Wesley Mission Queensland (the Previous Employer) and its employees. Since the approval of the Transferable Instruments, a decision was made to create a new incorporated entity, the Applicant, and all relevant employees of the Previous Employer who were covered by the Transferable Instruments, have transferred employment from the Previous Employer to the Applicant.

1. Section 311(1) of the Act sets out the circumstances in which a transfer of business occurs. It states:

“311      When does a transfer of business occur

Meanings of transfer of business, old employer, new employer and transferring work

(1)        There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:

(a)        the employment of an employee of the old employer has terminated;

(b)        within 3 months after the termination, the employee becomes employed by the new employer;

(c)        the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;

(d)        there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).”

1. Section 312 of the Act also indicates that a “transferable instrument” includes “an enterprise agreement that has been approved by the FWC”.

1. Section 313 of the Act provides that “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 transferrable 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…”

1. I am satisfied that there was a transfer of business and that the employees of the Previous Employer transferred to the Applicant under the terms of the Act. I am also satisfied that the Transferable Instruments are transferable instruments and that they now cover the Applicant and the transferring employees.

1. Section 314 of the Act also provides for a transferable instrument to cover other employees in certain circumstances. It states:

“314      New non-transferring employees of new employer may be covered by transferable instrument

(1)        If:

(a)        a transferable instrument covers the new employer because of paragraph 313(1)(a); and

(b)        after the transferable instrument starts to cover the new employer, the new employer employs a non-transferring employee; and

(c)        the non-transferring employee performs the transferring work; and

(d)        at the time the non-transferring employee is employed, no other enterprise agreement or modern award covers the new employer and the non-transferring employee in relation to that work;

then the transferable instrument covers the new employer and the non-transferring employee in relation to that work.

(2)        A non-transferring employee of a new employer, in relation to a transfer of business, is an employee of the new employer who is not a transferring employee.

(3)        This section has effect subject to any FWC order under subsection 319(1).”

1. I observe that the Nurses Award 2020, the Health Professional and Support Services Award 2020, the Social, Community, Home Care and Disability Services Industry Award 2010, the Aged Care Award 2020 and the Clerks – Private Sector Award 2020 (the Awards) are likely to cover the Applicant’s enterprise. Given the coverage of a modern award, s.314(1) does not operate to have the Transferable Instrument cover the non-transferring employees.

1. However, as indicated, the provisions contained in s.314 are subject to s.319 of the Act, which allows for the Commission to make an order that a transferring instrument covers non-transferring employees.

1. Section 319 of the Act provides as follows:

“319      Orders relating to instruments covering new employer and non-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 likely to, cover the new employer and a non-transferring employee because of subsection 314(1) does not, or will not, cover the non-transferring employee;

(b)        an order that a transferable instrument that covers, or is likely to cover, the new employer, because of a provision of this Part, covers, or will cover, a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer;

(c)        an order that an enterprise agreement or a modern award that covers the new employer does not, or will not, cover a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer.

Note:    Orders may be made under paragraphs (1)(b) and (c) in relation to a non-transferring employee who performs, or is likely to perform, the transferring work for the new employer, whether or not the non-transferring employee became employed by the new employer before or after the transferable instrument referred to in paragraph (1)(b) started to cover the new employer.

(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 non-transferring employee who performs, or is likely to perform, the transferring work for the new employer;

(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).

(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 transferrable 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 non-transferring employee before the later of the following:

(a)        the time when the non-transferring employee starts to perform the transferring work for the new employer;

(b)        the day on which the order is made.”

1. The Applicant is entitled to bring the applications, which rely upon the terms of s.319(1)(b) of the Act, in effect, to extend the coverage of the Transferable Instruments to any non-transferring employees.

1. In dealing with each of the applications, the Commission is required to have regard to each of the matters in s.319(3) in determining whether Orders should be made. I now turn to deal with each of those considerations.

The views of the new employer – s.319(3)(a)(i)

1. The Applicant, as the applicant and new employer, supports the applications and the orders sought.

The views of the new employees – s.319(3)(a)(ii)

1. It is not possible to obtain the views of the new employees who will be affected by the orders because there are no non-transferring employees currently employed by the Applicant.

Whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment – s.319(3)(b)

1. The Applicant submitted that any non-transferring employees would not be disadvantaged by an order.

1. While the Applicant acknowledged that the Transferable Instruments have passed their nominal expiry dates meaning that some rates of pay are less than those provided by the Awards, the Applicant submitted that employees currently covered by the Transferable Instruments are being paid base rates that are at least the same as those in the Awards. In any event, the Applicant pointed to s.206 of the Act which requires employees under the Transferable Instruments to be paid base rates of pay that are at least the same as those under the Awards.

1. The Applicant also noted that on an overall basis, the terms and conditions of the Transferable Instruments are better than those in the Awards. Finally, in respect of the Blue Care/Wesley Mission Brisbane Nursing Employees Enterprise Agreement 2013, the Wesley Mission Queensland Allied Health and Community Service Stream Employees Enterprise Agreement 2018 and the Wesley Mission Queensland Administration Employees Enterprise Agreement 2018, the Applicant has begun bargaining for replacement agreements.

1. I agree with the Applicant’s submission and I am satisfied that the employees would not be disadvantaged in relation to their terms and conditions of employment by the making of an order.

The nominal expiry date of the Transferable Instrument – s.319(3)(c)

1. All of the Transferable Instruments have passed their nominal expiry dates, being, respectively, 30 June 2016, 31 August 2021, 3 May 2022, 30 June 2021 and 30 September 2021.

Negative impact on the productivity of the new employer’s workplace – s.319(3)(d)

1. The Applicant submitted that the transfer of business will have little noticeable impact on its operations and productivity. Despite the change of name and corporate status, the Applicant retains its financial capacity, organisational legal structure and service delivery capacity. Therefore, the Applicant argued that its productivity will be positively impacted by an order, as it would ensure that all employees performing the same work, in the same classification at the same location will have identical guaranteed employment terms and conditions, thereby improving or at least maintaining employee engagement and productivity.

1. I am satisfied that there will be no negative impact on productivity if the order is made in respect of each of the applications. In contrast, if the order is not made and transferring and non-transferring employees are on different terms and conditions of employment, this may have a negative impact on team engagement and in turn upon workplace productivity.

Economic disadvantage – s.319(3)(e)

1. As the Applicant has retained its financial capacity following the transfer of business, it submitted that it will not incur any significant economic disadvantage if an order in each application were granted. The Applicant submitted that it would suffer economic disadvantage if an order in each application was not granted, as it would be required to reconfigure its payment systems to ensure non-transferring employees are paid and accrue leave in accordance with the relevant Award. The Applicant stated it would not have the capacity to perform this task, which would need to be outsourced, and it would be required to invest in training for relevant staff to implement the new systems.

1. I am satisfied that the Applicant would not incur any significant economic disadvantage should an order be issued in each application, and would instead be likely to incur economic disadvantage if an order were not made in each application.

Degree of business synergy – s.319(3)(g)

1. The Applicant submits that having all employees who perform the same at work at the same location subject to the same terms and conditions will promote business synergy, as it will allow non-transferring employees to receive the benefits of the Transferable Instruments which were negotiated specifically for the needs of the Applicant and its employees.

1. I am satisfied that if the sought order is granted, it will confirm a single framework of regulation that has been negotiated and approved in the context in which it has and will continue to apply.

Public interest – s.319(3)(g)

1. The Applicant submitted it would be in the public interest to grant an order, as it would balance the protection of employees’ terms and conditions of employment with the Applicant’s interests in running its business efficiently, would provide consistency for employees performing the same work, would maintain currently approved employment conditions and would allow new employees to receive the benefits of such, and would alleviate business inefficiencies that would arise from having to reconfigure its payment and administration systems to accommodate different sets of terms and conditions for employees performing the same work.

1. I have sought the views of the respective employee organisations covered by the respective Transferable Instruments, being the Australian Workers’ Union, the Australian Nursing and Midwifery Federation – QMNU Branch, the Australian Municipal, Administrative, Clerical and Services Union Queensland (Services and Northern Administrative), and the United Workers’ Union (the Unions). Each of the Unions stated that they consent to the orders proposed by the Applicant in respect of each of the Transferable Instruments the respective Unions are covered by.

1. I am therefore satisfied that it is in the public interest to grant the orders sought by the Applicant.

Conclusion

1. Having considered each of the matters in s.319(3) of the Act, I am satisfied that it is appropriate for orders to be made in respect of each of the applications. In accordance with s.319(4) of the Act, the Orders will come into operation in relation to each non-transferring employee when the later of the following occurs:

·   the time when the non-transferring employee starts to perform the transferring work for the new employer; or

·   the day on which the order is made.

1. Orders [PR779630, PR779632, PR779633, PR779634, and PR779635] will be issued to this effect.

COMMISSIONER

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