Woolworths Group Ltd

[2020] FWC 5018

[2020] FWC 5018

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement

Woolworths Group Ltd
(AG2020/1545)

COMMISSIONER HARPER-GREENWELL MELBOURNE, 28 SEPTEMBER 2020

Application for approval of the Melbourne Fresh Distribution Centre Enterprise Agreement 2020 - right of union to be heard.

[1] An application has been made for approval of an enterprise agreement known as the Melbourne Fresh Distribution Centre Enterprise Agreement 2020 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by Woolworths Group Limited (the Applicant). The Agreement is a single enterprise agreement.

[2] The Shop, Distributive and Allied Employees’ Association (SDA) being a bargaining representative for the Agreement, filed a Form F18 in support of and wish to be covered by the Agreement.

[3] On 10 June 2020 the United Workers’ Union (UWU), who were not listed as a bargaining representative on the Form F16, sent an email to the Fair Work Commission Melbourne Registry indicating that it sought to be heard in this matter. On that same day Member Assist (the Agreements team) sent an email to the UWU informing them that the matter was yet to be allocated to a Member.

[4] On 11 June 2020, the UWU sent an email to the Agreements Team informing the Commission they wish to make submissions on why it should be heard on this application and requested the Commission provide them with copies of the Form F16 and Form F17 that formed part of the application for approval of the Agreement.

[5] This application was subsequently allocated to my Chambers on 16 June 2020. My Chambers wrote to the UWU that same day providing redacted copies of the Form F16 and Form F17 in accordance with the Commission’s privacy obligations. It was noted in the correspondence to the UWU that they were not listed as a union bargaining representative on the Form F16 and if the UWU seeks to be heard in relation to the application they were to file in the Commission and serve on the Applicant submissions addressing the standing of the UWU to be heard and submissions pertaining to any concerns they had regarding the application by 18 June 2020. The UWU corresponded with my Chambers requesting an extension for the filing of their submissions which was subsequently granted.

[6] On 18 June 2020 the UWU sent an email to Chambers requesting unredacted copies of the F16 and F17 and the document titled “Summary of in principle agreement” (Summary document) referred to in the F17.

[7] The Applicant did not object to the UWU being provided with a copy of the Summary document. The Applicant did however object to the UWU being provided with unredacted versions of the F16 and F17, submitting to provide the information would be in breach of the privacy of individuals involved in the agreement making process.

[8] The Commission sent a copy of the Summary document to the UWU on the same day the request was made. The UWU was not provided with the unredacted F16 and F17 as requested however they were provided with an opportunity to make submissions in writing by 5pm Monday 22 June 2020 addressing any prejudice that may have been caused in preparation of their submissions.

[9] The UWU filed submissions 1 in accordance with the Commissions directions on 22 June 2020, the submissions also contained their objections to the approval of the Agreement. The UWU submits that the Commission may choose, in a particular case, to hear from an employee organisation who may not be party to the agreement under s.590 of the Act so as to inform itself in relation to any matter in such a manner it considers appropriate. The UWU requested that in the process of informing itself the Commission should grant permission to the UWU to be heard in relation to the application for approval of the proposed agreement for the following reasons:

•  Clause 5.2 entitles full-time employees to ‘10 days (76 hours)’ of paid personal/carer’s leave. Whereas by contrast the NES provides at s.96(1) of the Act an entitlement of ‘10 days of paid personal/carer’s leave.’

•  The Agreement at clause 3.1.2 provides that part-time employees will be rostered for an ‘average’ of at least 12 Ordinary Hours per week, and up to a maximum of 38 hours per week. As such the proposed agreement does not provide certainty regarding hours of work for part-time employees. Further there are no provisions for certainty of start and finish times for a part-time employee.

•  The Agreement at clause 3.1.2(a) provides for part-time employees to work additional hours up to 38 hours per week to be paid at ordinary rates.

•  The Agreement shift loadings and weekend penalties are lower than the Award rates.

•  The Agreement excludes numerous allowances payable under the Award.

[10] The UWU further submits that there are concerns as to genuine agreement because the Summary document provides that part-time employees have a minimum engagement of 12 Ordinary Hours per week whereas the Agreement provides for at least an average of 12 Ordinary Hours and those hours can be averaged over a 4 week period. They submit the Agreement does not provide details as to the certainty of hours arrangements for part-time employees as set out in clause 10 of the Storage Services and Wholesale Award 2010 (the Award). The Commission notes that the Award referenced in the parties material, the Form F17 filed by the Applicant and in the Agreement at page 39 is incorrect, and the correct Award reference is the Storage Services and Wholesale Award 2020.

[11] On 30 June 2020 the Applicant filed submissions 2 objecting to the UWU’s application to be heard in relation to the approval of the Agreement because the Shop, Distributive and Allied Employee’s Association (SDA), was the bargaining representative for the employees covered by the Agreement and have acted as representatives and signatories to the Applicants enterprise agreements for over 30 years. The submit the SDA adequately represents the interests of the employees covered by the proposed Agreement. The Melbourne Fresh Distribution Centre (MFDC) largely replaces the operations of Melbourne Produce Distribution Centre where they say the SDA have acted as a representative and signatory for the enterprise agreements for over 30 years. They further submit that the SDA is a signatory to 7 of the 15 enterprise agreements covering Woolworths (and related bodies corporates’) distribution centres.

[12] The Applicant submits enabling the UWU to be heard would complicate and lengthen the approval process which they say would be against the objects of Part 2-4 (Enterprise Agreement) of the Act. The Applicant also submits that permitting the UWU to be heard would provide an inappropriate precedent and there was no advantage to the UWU being heard as the Commission could satisfactorily inform itself of all the matters the UWU referred to in its submissions. In support of their submission the Applicant relies on the decision of Commissioner Bissett in Reserve Support Services Pty Limited T/A Reserve Support Services 3 in which the Commissioner stated that the decision in Collinsville “stands for the proposition that a union that is not a bargaining representative does not have the right to be heard”.4

[13] After considering the submissions of the parties regarding the UWU’s request to be heard the parties were notified that the matter would be listed for conference and any objections to the UWU’s participation would be dealt with at the conference.

[14] The matter was listed for conference on the 2 July 2020. On 1 July 2020 the Applicant consented to the UWU being provided with the details outlined in question 2.10 of the F17 being the number of employees covered by the agreement who cast a valid vote and how many of those employees voted to approve the agreement.

[15] Although the Applicant objected to the UWU being heard, submitting that the UWU’s concerns could be adequately dealt with by the Commissions without the UWU’s submissions, the Applicant acknowledges that I have the power under s.590 to inform myself and consented to the concerns of the UWU being addressed at conference in an attempt to resolve those concerns.

[16] At the conference convened on 2 July 2020 the parties were afforded an opportunity to address me on the Agreement approval issues raised by the UWU. I advised the parties if the matters could not be resolved during the conference, I would proceed to hear them on the matter of the UWU’s request to be heard in this Application.

[17] The matter did not resolve at conference. After a short adjournment the matter proceeded into formal hearing and the parties were afforded the opportunity to make oral submissions in addition to their written submissions on the issue of Standing. The UWU submits that it represents several thousand employees at a number of Woolworths distribution centres across the country. Of the 12 distribution centres the UWU submit they have 9 agreements where the Union has sought and was granted coverage. Further they submit at a point in time when the site becomes operational the UWU will have constitutional coverage of the work to be carried out at the site.

[18] At the time the Application was made and at the time of the conference/hearing the UWU was not aware of any members it may have that would be covered by the Agreement. At the end of the hearing the UWU submitted that should I decide they do not have Standing to be heard they would seek to make further submissions in that regard.

[19] The Full Bench decision in Construction, Forestry, Mining and Energy Union v Collinsville Coal Operations Pty Limited 5, deals with the right of an employee organisation to be heard in an application for the approval of an agreement. The Full Bench stated at [65]-[66] and [69]:

“[65] In our view the right, interest or legitimate expectation that is said to be affected by application of the kind before the Senior Deputy President must be identified and understood against the framework of enterprise bargaining and agreement making established by the FW Act. It is not enough, without more, to point to the status of the CFMEU as an employee organisation with a history of representation at the workplace or in the industry. Moreover, this is not a case where some of the members of the CFMEU voted against the approval of the Agreement or did not vote at all. All of the employees covered by the Agreement voted, and all of those employees (including Employee 2) voted in favour of approving the Agreement.

[66] The statutory framework includes that enterprise agreements are made principally between an employer and employees; that bargaining representatives have a role in relation to enterprise bargaining either by default or by appointment; that default bargaining representatives can be displaced by appointment or by revocation; that enterprise agreements operate primarily at the single enterprise level and do not create rights of general application across an industry or have common rule application; that rights of an employee organisation to be involved in the bargaining process under the FW Act is not separate from its standing as a bargaining representative; and that its capacity to be involved in protected industrial action by seeking a protected action ballot authorisation cannot be separated from its standing as a bargaining representative.

...

[69] That an employee organisation has an ongoing relationship with its members who might become covered by an agreement and has a role under its rules in representing those members is not relevant in the context of a right to be heard in relation to the approval of an agreement. The FW Act does not confer a right on employee organisations (other than in the case of the greenfields agreement) to be covered by an agreement if it was not a bargaining representative. Likewise, the FW Act does not confer upon an employee organisation a role in enterprise bargaining under the FW Act outside of its status as a bargaining representative. The mere fact that an employee organisation has an ongoing relationship with its members and is entitled to represent their industrial interests is not a sufficient basis to conclude that the approval of an enterprise agreement will adversely affect a right, interest or legitimate expectation of that employee organisation.” (references omitted)

[20] The Full Bench observed at [70] the fact that an employee organisation has amongst its interests, objects and expectations, that it will obtain and maintain reasonable employment conditions for its members is an insufficient basis to give rise to a right, interest or legitimate expectation and thereby a conferral on the employee organisation of a right to be heard in relation to an application to approve an agreement.

[21] The UWU has been afforded the opportunity to make both written and oral submissions. I am satisfied the UWU has been provided with a reasonable opportunity to be heard on the matter of Standing and to accede to further requests to be heard on this issue would not only prejudice the Applicant it would unreasonably further delay the Agreement approval process.

[22] I do not consider the reasons provided by the UWU to be sufficient enough reason to grant Standing to be heard further. Therefore, I do not propose to grant the UWU an opportunity to be heard further on the matters outlined in its written submission or its oral submissions pertaining to the Agreement approval.

[23] In the process of informing myself under s.590 of the Act the UWU has already been afforded the opportunity to make both written and oral submissions outlining their objections to the approval of the Agreement. As properly put by the Applicant, the UWU concerns about matters that may affect the approval of the Agreement were well ventilated in the conference before the Commission and therefore what has been heard by the Commission cannot subsequently be unheard.

[24] Although I do not propose to grant the UWU any further opportunity to be heard I have taken into consideration the concerns of the UWU as part of the overall assessment of the Agreement in the approval process.

[25] The UWU submits that Clause 5.2 of the Agreement which deals with Personal/Carers leave is inconsistent with the findings in Mondelez v AMWU 6 (Mondelez v AMWU), which at the time of the conference was the subject of appeal in the High Court.

[26] Clause 5.2 of the Agreement provides that full-time employees are entitled to 10 days (76 hours) (emphasis added) of paid personal/carer’s leave (in accordance with the NES) and part-time employees are entitled to personal/carer’s leave on a pro-rata basis based on the number of Ordinary Hours worked, including additional hours. The UWU takes issue with the inclusion of the reference to 76 hours.

[27] The Applicant recognises that clause 5.2 should be read consistently with the National Employment Standards, however to avoid doubt the Applicant has proposed to provide an undertaking that the NES will be complied with.

[28] The SDA submits that they would support any undertaking required to comply with any decision handed down by the High Court in Mondelez v AMWU.

[29] Subsequent to the conference the High Court handed down its decision. The decision in Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union; Minister for Jobs and Industrial Relations v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union 7(Mondelez) provided clarity on what is meant by ‘a day’ in section 96 of the Act for the purpose of calculating an employee’s entitlements to paid personal/ carer’s leave. The majority of the High Court found that the expression ’10 days’ in the Act refers to a ‘notional day’ consisting of one-tenth of the equivalent of an employee’s ordinary hours of work in a two-week period. An employee’s entitlement to ’10 days of paid personal leave’, regardless of their roster arrangement, is therefore to be calculated and paid at the rate of 1/26 of that employee’s ordinary hours of work in a year.

[30] The Agreement provides that personal/carers leave will be in accordance with the NES. Taking into consideration clause 3.1 which provides for a maximum of 38 Ordinary Hours to be worked per week (averaged over a 4 week cycle), I am satisfied that clause 5.2 is not inconsistent with the provisions of section 96 (1) of the Act. The Commission does not require the Applicant to provide the undertaking proposed during the conference held on 2 July 2020.

[31] The UWU submits that the Agreement allows part-time employees to be directed to work additional Ordinary Hours. It submits the Agreement also provides for an average (emphasis added) of 12 hours per week rather than the Award minimum of 3 hours per shift and part-time employees may be left worse off it they work large amounts of overtime and do not receive overtime hours. Further they submit that the Agreement does not provide the same safeguards provided by the Award for specifying days and hours to be worked for part-time employees.

[32] The Applicant submits that the Agreement should be read as to provide a part-time employee with a minimum of 12 hours per week and not an average of 12 hours per week and submits that it is prepared to provide an undertaking to that effect. They further submit that the clause is identical in terms of Agreements which they have negotiated with the UWU and had approved by the Commission without being subjected to objections.

[33] The Applicant further submits that the Agreement provides the more beneficial terms of a minimum of 4 Ordinary Hours per shift as opposed to the Clause 10.5 of the Award that provides for a minimum of 3 consecutive hours per shift.

[34] The SDA submit that they would not oppose the undertaking proposed by the Applicant. They further submit the clauses being objected to by the UWU are clauses that can be found in Agreements previously negotiated by the UWU (or the NUW as it was at the time) with Woolworths that were approved without any dispute being raised by the UWU or objections, nor was there are requirement for undertakings. The SDA submit that a relevant consideration is that the current Agreement has significant advantages including significantly higher wages than the recent Agreement that was negotiated with the UWU and approved by this Commission without any objection being raised by the UWU.

[35] It is not of relevance whether previous agreements approved by this Commission held similar or same clauses negotiated by the UWU. The Commission assess each application before it on its own merits.

[36] Clause 3.1 outlines the different employment arrangements and provides that the maximum number of Ordinary Hours that can be worked by an employee is 38 hours per week averaged over a 4 week cycle. An employee may be rostered to work no more than 10 Ordinary Hours per shift and no more than 5 shifts in any week. The Agreement also provides for a minimum of 4 hours per shift.

[37] Clause 3.1.2 provides that a part-time employee will be rostered for an average (emphasis added) of at least 12 Ordinary Hours each week.

[38] Clause 3.1.2(a) states the following:

“There may be weeks where you could be available, and want to work additional Ordinary Hours. As a part-time team member you may work up to 38 Ordinary Hours in a particular week by mutual agreement.” (emphasis added)

[39] The Agreement provides that a part-time employee can provide on-going consent to work additional Ordinary Hours however this must be in writing or electronically and consent can be withdrawn at any time. The Agreement states that it is the employee’s choice as to whether they choose to work the additional Ordinary Hours or not. Employees seeking to work additional Ordinary Hours are to notify the Applicant a week in advance of being offered any available hours.

[40] Contrary to the submission of the UWU it is clear on a plain reading of clause 3.1.2(a) for a part-time employee to work additional Ordinary Hours there must be a mutual agreement reached between the employee and the employer. I am satisfied the Agreement does not provide for circumstances in which a part-time employee can be directed to work additional Ordinary Hours. Further, there are sufficient safeguards in place to ensure part-time employees are able to refuse to work additional Ordinary Hours if they become available.

[41] The UWU submits that the Agreement lacks the safeguards to be found in Clause 10 of the Award. Clause 10 provides at 10.3:

“At the time of engagement the employer and the part-time employee will agree in writing, on a regular pattern of work, specifying at least:

a) the hours worked each day;

b) which days of the week the employee will work; and

c) the actual starting and finishing times each day.”

[42] Clause 10.4 provides that any agreed variation to the regular pattern of work will be recorded in writing. Clause 10.5 provides that a part-time employee must be engaged for a minimum of 3 consecutive hours on any shift.

[43] The Applicant submitted that employees are placed on a roster so that the base hours are repeated at the same time each week and the concerns raised by the UWU would not arise due to rostering arrangements.

[44] The Applicant submits that when reading clauses contained within 3.1 as a whole it is evident that employees will be provided with a base contract that provides at least 12 hours of work per week. I am satisfied that this is the case and a minimum engagement of at least 12 Ordinary Hours of work per week is a more beneficial term than that provided for in the Award.

[45] The Agreement provides for a minimum shift engagement and it specifies that part-time employees will be engaged for an average of at least 12 Ordinary Hours each week. Clause 3.2 provides that Ordinary Hours rosters may be the same from week to week or they may cycle over a two, three or four week period. Rosters are provided through electronic means and can be changed by mutual agreement or in certain circumstances by consultation with notice.

[46] The Agreement provides that employees will be provided with their rostered hours in writing, the hours to be worked each day, the days of the week to be worked. I am satisfied that the Agreement provides for the requirement to provide part-time employees with their Ordinary Hours of work, notice of the hours to be worked, start and finish times in writing.

[47] The UWU submits that the Agreement contains significantly lower shift loadings and weekend penalties than the Award and excludes a number of allowances payable under the Award.

[48] The Applicant submits the significantly higher base rates, which are between 35 to 38% higher than the Award, in all working hours combinations under the Agreement leaves the employees better off overall.

[49] Modelling conducted by the Commission has determined that the Agreement offers rates of pay between 35.32% and 35.99% above the Award. The Agreement weekend penalty rates are Saturdays 140% and Sundays 170% when compared to the Award rates of Saturdays 150% and Sundays 200%. Appendix B provides a table showing relevant penalty rates applicable at certain times. Even though the Agreement provides for lower weekend penalty rates, I am satisfied the rates of pay are high enough to compensate for this reduction.

Genuine Agreement-explanation to employees

[50] The UWU contends that the Agreement was genuinely agreed because the employees balloted for the proposed agreement have no experience at the proposed site as work at the site is yet to commence. They further submit the Summary document at [16] is misleading in that it inaccurately compares the terms of the Award to the Agreement in that it states “Part time employees have a minimum 12 Ordinary Hours per week engagement (the Award only has a 3 hour minimum)”. They submit the proposed Agreement at clause 3.1.2 does not guarantee 12 Ordinary Hours per week. Rather it provides a 12 hour weekly average.

[51] The Applicant and the SDA submit that a comprehensive explanation of the terms was provided to employees. The SDA participated in the explanation to all employees which included a ‘page turn’ of the Agreement. The SDA conducted small group meetings explaining the negotiation process and the proposed terms of the Agreement.

[52] The Applicant submits the word “average” is misplaced as it was at all times the intention of the Applicant to provide employees with a minimum engagement of 12 hours per week. They submit an undertaking to that effect should be sufficient to alleviate any concern the Commission may have about genuine agreement.

[53] As outlined earlier the Applicant submits that the employees who have been engaged to work at the MFDC have worked at the site that the MFDC is primarily replacing and have the relevant experience required. The UWU not being a party to the Agreement was not present at the meetings being conducted and rely on a single sentence in the summary document. The SDA was capable and did at all times represent the employees that are to be covered by the Agreement. It is the SDA’s submission that the terms were adequately explained to the employees. On the materials before me I have no reason to believe that the Agreement was not genuinely agreed.

[54] The Applicant has submitted that it was the intention of the parties to the Agreement that part-time employees were to be provided with a minimum of 12 Ordinary Hours per week. An undertaking of the kind proposed by the Applicant would be sufficient to address the concerns of the Commission.

Would the Agreement pass the better off overall test?

[55] The relevant modern award for the purposes of the better off overall test (BOOT) is the Storage Services and Wholesale Award 2020.

[56] The Agreement operates in place of the Award. Overall the Agreement provisions are relatively consistent with the Award. The Agreement rates are sufficiently high enough to compensate for the Allowances in the Award that have not been provided for in the Agreement.

[57] The Agreement contains a range of more beneficial terms for employees compared to the Award including a higher minimum engagement for part-time employees, protective clothing with a reimbursement for safety boots up to $180, 15 minute paid meal breaks, annual leave is paid at the employees ordinary rate plus penalty rates and paid domestic violence leave.

[58] In addition to the lower penalty rates discussed earlier in this decision, the Agreement also contains a number of less beneficial terms not addressed earlier in this decision including no meal allowance, first aid allowance or cold allowance. However, I am satisfied the rates in the Agreement are sufficiently high enough to compensate for the less beneficial terms.

[59] The Employer has proposed to provide written undertakings to address the concerns of the Commission pertaining to the engagement of part-time employees outlined earlier in this decision.

[60] Subject to the provision of satisfactory undertakings on the basis of the material contained in the application, the accompanying statutory declaration and the submissions of the Applicant and the SDA on the 2 July 2020, I am satisfied that the Agreement is capable of passing the BOOT and is therefore capable of approval.

[61] The Applicant’s undertakings are to be provided to my Chambers by 5:00pm Tuesday 29 September 2020.

COMMISSIONER

Appearances:

L Meagher from the Applicant
D Macken of A.J Macken & Co for The Shop, Distributive and Allied Employees’ Association
R Payne from the United Workers’ Union

Hearing details:

2020.
Melbourne (by Telephone):
July 2.

Printed by authority of the Commonwealth Government Printer

<PR722890>

 1   Exhibit R1, UWU Submissions

 2   Exhibit A1, Applicant Submissions

 3   [2019] FWC 6519

 4   Ibid at [32]

 5   [2014] FWCFB 7940

 6 [2019] FCAFC 138

 7 [2020] HCA 29