Yum Restaurants Australia Pty Ltd T/A Pizza Hut

[2014] FWCA 6547

[2014] FWCA 6547

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement

Yum Restaurants Australia Pty Ltd T/A Pizza Hut
(AG2014/1514)

PIZZA HUT QUEENSLAND - SDA EMPLOYEE RELATIONS AGREEMENT 2014

Fast food industry
COMMISSIONER BULL	SYDNEY, 18 SEPTEMBER 2014

Application for approval of the Pizza Hut Queensland - SDA Employee Relations Agreement 2014.

[1] An application has been made for approval of an enterprise agreement known as the Pizza Hut Queensland - SDA Employee Relations Agreement 2014 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). The Agreement is a single-enterprise agreement.

[2] In this matter, the Applicant, Yum Restaurants Australia Pty Ltd T/A Pizza Hut was represented by ER Strategies Pty Ltd. The application indicated that the Shop, Distributive and Allied Employees Association (SDA), was a bargaining representative for the Agreement.

Extension of time

[3] The application was lodged at Brisbane on 24 June 2014. Section 185(3)(a) of the Actprovides that an application for approval must be made within 14 days after the Agreement is made. I note that the application was lodged out of time. Section 185(3)(b) of the Actconfers a discretion on FWC to extend time. In light of the reasons provided by the Applicant, I have decided to exercise the discretion provided by subsection 185(3)(b) of the Act and extend time accordingly.

Employers to be covered by the Agreement

[4] In the Form F16 - Application for approval of an enterprise agreement, which was filed with the application, the Commission noted that there is more than one employer that will be covered by the Agreement. The list of the employers to be covered by the Agreement is provided at Schedule 3 of the Agreement.

[5] Pursuant to s.172(2) of the Act it provides that an employer, or 2 or more employers that are single interest employers, may make an enterprise agreement (a single-enterprise agreement). In particular, s.172(5) of the Act states that two or more employers are single interest employers if:

(a) The employers are engaged in a joint venture or common enterprise; or

(b) The employers are related bodies corporate; or

(c) The employers are specified in a single interest employer authorisation that is in operation in relation to the proposed enterprise agreement concerned.

[6] The Applicant’s representative advised the Commission that the employers listed in Schedule 3 of the Agreement are single interest employers engaged in a common enterprise and referred to the Full Bench decision of Yum Restaurants Australia Pty Ltd and Shop, Distributive and Allied Employees Association 1 in which the Full Bench concluded at paragraph 14:

“We have no doubt that the operations of the Pizza Hut franchisees and the Franchisor, Yum are conducted as a common enterprise. They have a common purpose which can be described as the successful operation of Pizza Hut stores. In various ways they contribute to the purpose that unites them. The totality of the evidence leads to that finding.”

[7] I am satisfied that the employers listed in Schedule 3 of the Agreement are single interest employers pursuant to s.172(5)(a) of the Act, in that they are employers engaged in a common enterprise.

Correction of error

[8] With respect to Schedule 3 - Pizza Hut Franchisees, the Applicant has advised of errors relating to the list of franchisees to be covered by the Agreement. The Applicant requested that the schedule be amended to:

● Delete reference to ‘As trustee for the Wyndham Family Trust’.
● Add to Windsing Pty Ltd ‘As trustee for the Wyndham Family Trust’.
● Add ‘Unreal Car Sound Pty Ltd ABN 16 719 191 030 as trustee for Unreal Trust’.

[9] The Commission requested a copy of the votes by the employees with respect to the above named franchisees to demonstrate that those franchisees were part of the enterprise bargaining process. A copy of the votes were provided to the Commission.

[10] Pursuant to s.586(a) of the Act, the Commission may allow for a correction or amendment of any application, or other document relating to a matter before the Commission, on any terms it considers appropriate. On the submission made by the Applicant with respect to the amended schedule of franchisees, the schedule will be amended to correct the errors.

[11] A copy of the amended schedule 3 is attached to this decision at Annexure A.

Undertaking

Dispute settlement procedure

[12] Upon request from the Commission, the Applicant has provided an undertaking with respect to clause 6.4 - Grievance Procedure, of the Agreement. The undertaking states that the dispute settlement procedure in the Agreement will apply to any disputes that arise in relation to the National Employment Standards as per s.186(6)(a)(ii) of the Act.

[13] The undertaking is taken to be a term of the Agreement. A copy of the undertaking is attached at Annexure B.

[14] Pursuant to s.190(4) of the Act, the SDA has been made aware of the undertaking provided. The SDA has not advised of any concerns with the undertaking provided.

Better off overall test

[15] In its correspondence to the Applicant and the SDA, the Commission raised a number of concerns relating to terms in the Agreement that appeared to be less than the entitlement employees would have been afforded under the relevant reference industrial instruments stated as applying by the Applicant for the purpose of the better off overall test. In particular, the concerns related to the minimum shift engagement of employees, penalties and allowances.

[16] The Applicant stated in its Form F17 - Employer’s statutory declaration in support of an application for approval of enterprise agreement, that the following modern awards and NAPSA’s applied:

● Fast Food Industry Award 2010
● Restaurant Industry Award 2010
● Pizza Hut - SDA National Employee Relations Agreement 2004
● Retail Take-Away Food Award - South-Eastern Division 2003
● Cafe Restaurant and Catering Award - State (Excluding South-East Queensland) 2003

[17] Subsequently the Applicant advised that correct reference instruments were the Fast Food Industry Award 2010 and the Restaurant Industry Award 2010 and re-filed its Form F17 stating the correct industrial instruments.

[18] Further modelling was undertaken by the Commission that demonstrated employees would be better off overall under the Agreement when compared to the Fast Food Industry Award 2010 and the Restaurant Industry Award 2010, being the relevant modern awards for the purpose of the better off overall test.

[19] With respect to clause 11.3.1 and 11.3.2 of the Agreement it provides that casuals and delivery drivers will not be engaged for less than 2 hours and 2 and half hours for other employees. The Fast Food Industry Award 2010 (the Fast Food Award) provides that the minimum daily engagement is three hours. The Commission requested the Applicant to provide an undertaking in relation to this concern.

[20] The Applicant has advised the Commission that providing an undertaking in relation to this concern would materially alter the basis of the Agreement entered into between the parties.

[21] The Applicant submits the Agreement provides offsetting enhanced minimum conditions for employees compared to the 3 hours under the Fast Food Award, in that they would need to be provided with at least 3x3 hour shifts per week or some other combination to receive at least the minimum average of 9 hours per week under the Agreement. Further, the Applicant has stated the additional remuneration provided under the Agreement adequately reimburses employees for any reduction in overall entitlements arising for the reduced minimum shift period.

[22] With respect to the clothing allowance provided for at clause 35.3.2 the allowance for full-time employees would be less than the allowance provided under the Fast Food Award and where a part-time or casual employee were to work four or more shifts in one week that allowance provided under the Agreement is less than the entitlement an employee would have been afforded under the Fast Food Award.

[23] The Applicant submits there are only a small number of full-time employees engaged under the Agreement, and for them, the reduction in relation to the clothing allowance when compared to the Fast Food Award allowance is 0.2% which is covered by the additional penalty loading applying to all wage rates under the Agreement.

[24] The Applicant has advised that the vast majority of employees are either part-time or casual and that any employee working less than 4 shifts per week would receive a significantly higher clothing allowance under the Agreement which may be offset against the more limited situations where an employee works 4 or 5 shifts per week.

[25] Upon review of the submissions and undertaking provided by the Applicant, I am satisfied that employees would be better off overall under the Agreement.

[26] The Shop, Distributive and Allied Employees Association being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers this organisation.

[27] I am satisfied that each of the requirements of ss.186, 187 and 188 of the Act as are relevant to this application for approval have been met.

[28] The Agreement is approved. In accordance with section 54(1), the Agreement will operate from 25 September 2014. The nominal expiry date of the Agreement is 14 January 2016.

[29] This decision is to be brought to the attention of the employees.

COMMISSIONER

Annexure A

Annexure B

 1   [2010] FWAFB 7591

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