AG2010/838, Transcript of Proceedings [2010] FWATrans 895 (20 May 2010)

TRANSCRIPT OF PROCEEDINGS

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Fair Work Act 2009 26222-1

COMMISSIONER MCKENNA

AG2010/838

s.185 - Application for approval of a single-enterprise agreement

Application by Melbourne Nursing Agency Pty Ltd
(AG2010/838)





Sydney

11.24AM, MONDAY, 3 MAY 2010

PN1

THE COMMISSIONER: Thank you. Good morning and firstly my apologies for the delay in starting. Could I have the appearances please?

PN2

MS A GRANT: Commissioner, I am a solicitor and I seek permission to appear for the applicant in this matter, Melbourne Nursing Agency Proprietary Limited. Also with me today is MS P RYAN, solicitor, and observing today is my colleague, MS H MILLS, solicitor. I note that the employee’s representative, Ms Heather Stevenson was not required to attend this morning.

PN3

THE COMMISSIONER: Thank you. Take a seat. Could I begin by asking you to tell me a little bit about this agreement? It is proposed to cover only four employees, two of whom voted on it.

PN4

MS GRANT: At the time the agreement was made, that is correct, four employees. The agreement is proposed to cover clerical employees of the employer as well as patient services employees who are trainees of the employer. Essentially the employer is a small business that places health professionals within a range of public, private and community based health care organisations, so they employ the local registered nurses and health care workers, and they match their staff to the specific shift requirements of their clients. That is essentially what
the - - -

PN5

THE COMMISSIONER: Is it a labour hire company?

PN6

MS GRANT: Essentially, yes.

PN7

THE COMMISSIONER: So when you say it is a small company, how many employees does it have?

PN8

MS GRANT: At the time the agreement was made there were four in terms of the employees to be covered by this agreement, but in terms of the nurses employed on a casual basis, and other healthcare professionals, I’m not certain of the actual number. I would need to seek instructions to check on the number there. They would certainly have a lot of employees on the books in that regard.

PN9

THE COMMISSIONER: So the Melbourne Nursing Agency employs only four employees, apart from the casuals that it places in different locations?

PN10

MS GRANT: At the time the agreement was made, yes, that’s correct.

PN11

THE COMMISSIONER: How many does it now employ?

PN12

MS GRANT: I believe it is the same number, four employees, which is the same as the time the agreement was made, so four clerical employees as well as - it is proposed to also cover patient services employees as well who are trainees.

PN13

THE COMMISSIONER: Is the business expanding at the moment?

PN14

MS GRANT: I think it has - that is the idea, that it will, but just currently that is the number of employees that are to be covered.

PN15

THE COMMISSIONER: Well, I just raise it in this context, that this agreement covers a multitude of classifications and I just have a hesitation about an agreement which is covers so many classifications in circumstances where you tell me it actually only covers four employees.

PN16

MS GRANT: In terms of the clerical employees, in clause 6 of the agreement it outlines two levels, and the clerical employee to be covered by this agreement would be classified as either a level 1 clerical employee or a level 2 clerical employee, and there is certainly coverage for both permanent and casual clerical employees and trainees within the agreement. In terms of patient services employees, the only employees to be covered in that regard are trainees.

PN17

THE COMMISSIONER: So does this cover casual employees who would be put out in host organisations?

PN18

MS GRANT: No. Well, patient service employees who are trainees obviously be working within that healthcare setting outside of the employer’s location of their primary business, so the patient service employees would be working within the healthcare organisations but on a traineeship.

PN19

THE COMMISSIONER: Yes, but what I’m trying to clarify is that this is an agreement which comes before Fair Work Australia as covering four employees. I have the impression, rightly or wrongly, subject to any submissions or further evidence that there might be adduced that it is intended to have a more expansive operation, that is outside let us say for example, the head office of the Melbourne Nursing Agency.

PN20

MS GRANT: It is in terms of the patient services employees who would not work at the actual agency itself, they would work out at the client’s premises. In terms of the clerical employees, they’re based in the employer’s primary location in the Melbourne CBD.

PN21

THE COMMISSIONER: How many patient services employees are there?

PN22

MS GRANT: At the time the agreement was made there were no patient services employees who were training. The only employees at the time the agreement was made who were employed by the employer were the four clerical employees.

PN23

THE COMMISSIONER: Well, how could they vote on an agreement concerning patient service employees if they were only clerical employees?

PN24

MS GRANT: I understand your point. Would I be able to provide you with further submissions on that particular point?

PN25

THE COMMISSIONER: Yes. I have the strong impression from this agreement, as I say, subject to matters that might be advanced, that this is an agreement which is intended to have a much wider operation than it might otherwise appear on the face of the papers, and now you tell me that although only clerical employees voted on this agreement, in fact it is intended to cover patient services employees who would be placed outside the head office.

PN26

MS GRANT: And on a traineeship. Patient services employees who are not on a traineeship are outside the scope of this agreement. This agreement is only intended to cover patient services employees who are trainees which we submit is a fairly distinct group within the class of employee to be covered by the agreement.

PN27

THE COMMISSIONER: But none of the employees who voted on this agreement were actually patient services employees, they were just clerical staff. Is that correct?

PN28

MS GRANT: That is correct, yes.

PN29

THE COMMISSIONER: That presents a problem. It presents a fundamental problem. I would need some further material in relation to that because if the only employees who actually voted on this agreement are being used as a vehicle to vote other classes of employees there is a self evidence difficulty.

PN30

MS GRANT: Certainly, Commissioner.

PN31

THE COMMISSIONER: Putting aside that general concern which is a fundamental concern, could I take you to some aspects of the application papers themselves. I’ll take you to the form F17, the employer’s declaration in support of the application for the approval of an enterprise agreement. Clause 2.4 of the employer’s declaration requires the following information, “Please specify the steps taken by the employer to ensure the relevant employees were given or had access to the written text of the agreement and any other material incorporated by reference in the agreement during the 7-day period ending immediately before the start of the voting process”.

PN32

The response given is, “At least 8 days before the secret ballot all employees were provided individually with a copy of the proposed Melbourne Nursing Agency” et cetera, “And the How, When and Where document which provided a URL link to the Fair Work Act and the location of the company policies and procedures”. I don’t regard formulations in statutory declaration which simply say something in the nature of at least 8 days beforehand is satisfactory. I would require information as to the specific date on which that was provided.

PN33

MS GRANT: Certainly, Commissioner. I can provide that for you.

PN34

THE COMMISSIONER: I would like to see a copy of the How, When and Where document. Presumably this was done by some electronic means and it says that there was a URL link to the Fair Work Act.

PN35

MS GRANT: I have a copy of the How, When and Where document with me today. It is not the original copy that was actually given out to the employees. The date of the ballot and those sort of details aren’t filled in, but if you would like to see it?

PN36

THE COMMISSIONER: No, I would like to see the one that was given to the employees.

PN37

MS GRANT: Certainly.

PN38

THE COMMISSIONER: Also the specific date on which it was provided. Was it done electronically, if there was a URL link?

PN39

MS GRANT: I would have to seek instruction from Ms Stevenson on that, whether or not it was handed to them individually or if it was emailed to them.

PN40

THE COMMISSIONER: If it was emailed to them, which seems to be the suggestion given the reference to a URL link, I want to see the date of that email. Similarly in clause 2.5 it says “Please specify the steps taken by the employer at least 7 days before the start of the voting process to notify all relevant employees of the time and place at which the vote was to occur and the voting method to be used”. Once again, I don’t regard a statutory declaration saying “At least 8 days before the start of the voting process” to be acceptable. I want the specific date.

PN41

As to this How, When and Where document as identified in the employer’s declaration, it says the date, location and time at which the vote was to occur, that it was to be a secret ballot, there would be a nominated returning officer. Who was the returning officer do you know?

PN42

MS GRANT: I’m not entirely sure of the precise employee who was the returning officer, but certainly one of the four employees to be covered by the agreement.

PN43

THE COMMISSIONER: Do you have any basis to say that?

PN44

MS GRANT: That was my instruction, that the returning officer certainly was one of those four clerical employees.

PN45

THE COMMISSIONER: So do you have a standard How, When and Where document, but not specifically the one that -

PN46

MS GRANT: I have the How, When and Where document that the employer certainly used, but not the one that has the details of the date of the ballot. So I have got - the one I can show you explains a lot of the content within the declaration as to how the vote was to occur, providing the URL link as well, but certainly not the copy that the employer distributed.

PN47

THE COMMISSIONER: Actually, on that topic, as to documentation, did I ask you for a copy of the Notice of Representational Rights? No?

PN48

MS GRANT: No.

PN49

THE COMMISSIONER: I would need to see that and advices confirming when it was provided. It says here that it was on 2 March. Was it done by email?

PN50

MS GRANT: I would have to see the means by which - I know they certainly took a personalised approach, either handing it to the employees individually or by email. We will just have to seek instructions as to the precise means.

PN51

THE COMMISSIONER: At clause 2.6 it says “Please specify the steps taken by the employer to explain the terms of the agreement and the affect of those terms to relevant employees”. It says at the first dot point that “The employer met with each employee individually prior to the secret ballot taking place”. That would appear to suggest that the access period requirements have not been met. If this explanation occurred prior to the secret ballot taking place it would appear to be a difficulty.

PN52

MS GRANT: In relation to the access period, my understanding Commissioner is that the access period relates to providing employees with access to the agreement itself and any additional documentation in relation to explaining the terms of the agreement. However, I’m not sure it specifically has to be within the access period.

PN53

THE COMMISSIONER: Yes, that may well be right. Perhaps you could have another look at that?

PN54

MS GRANT: Absolutely.

PN55

THE COMMISSIONER: Clause 2.7 says “Please provide the following details of the vote on the agreement”. You’ve got four employees and you could only manage to get two along to the vote?

PN56

MS GRANT: The employer certainly took all reasonable steps to ensure that all employees to be covered by the agreement were given a reasonable opportunity to vote, and certainly encouraged them to vote, but out of those four employees only two chose to participate in the secret ballot held on that day.

PN57

THE COMMISSIONER: Now, clause 2.9, and this goes to the heart of what we have been discussing earlier. It says that “The employees to be covered by the enterprise agreement are as follow: all clerical employees and all patient services employees who are trainees”. But you tell me that only clerical employees participated in the vote for this agreement?

PN58

MS GRANT: That is correct, yes.

PN59

THE COMMISSIONER: Clause 2.14 says “Does the agreement contain any discriminatory terms?” and the answer given is “No”. I will be taking you to some provisions later in the agreement. At clause 2.29 you identify that the agreement does contain terms providing for school based apprentices or trainees to receive loadings in lieu of paid leave.

PN60

MS GRANT: I would say that the intention of this agreement is not to cover school based trainees. I think that maybe an error in that regard. There certainly are loaded rates of pay for trainees to be covered by the agreement, but not school based trainees.

PN61

THE COMMISSIONER: Well, this is what your client’s statutory declaration says.

PN62

MS GRANT: I can certainly seek further clarification on that.

PN63

THE COMMISSIONER: At clause 3.1 and following you have identified various instruments, but as you have confirmed various of those instruments would not have applied to the small group of employees who participated in the ballot.

PN64

MS GRANT: The employees who participated in the ballot, and certainly the four employees to be covered were clerical employees, but because we have obviously provided for patient services employees to be covered as well, those are the reference instruments used for particular classes of employees.

PN65

THE COMMISSIONER: I have come to it a few times now and the difficulty that I see is that employees have purported to vote on the terms and conditions of employees who are covered by other reference instruments and those who did not actually participate in the ballot. Anyhow, I will hear what you have to say in relation to that when the matter is relisted.

PN66

MS GRANT: Thank you, Commissioner.

PN67

THE COMMISSIONER: Clause 3.4 says “Does the agreement contain any terms or conditions of employment that are less beneficial than the equivalent terms and conditions in the reference instruments identified in question 3.1 or 3.2?” So there are nine instruments identified in clause 3.1 and 3.2, with some duplication of the National Training Wage Award. The employer’s declaration says “If yes, identify the terms and conditions in the reference instruments that are more beneficial than the agreement, the employees affected and the specific terms in the agreement that bring about the reductions.” In the last line of the first paragraph it says “There are no terms and conditions in these reference instruments that are more beneficial than this enterprise agreement”.

PN68

MS GRANT: That is in terms of the modern awards that have been referenced. In relation to the pre 1 January Federal awards that have been referenced, particularly in relation to rates of pay, we have listed there for each class of employees the reference instrument and the terms of those instruments that are more beneficial than the agreement in that regard.

PN69

THE COMMISSIONER: What about the transitional arrangements that apply in relation to the other instruments? Are there any?

PN70

MS GRANT: There are, yes.

PN71

THE COMMISSIONER: You say that there are no terms and conditions that are less beneficial than might otherwise apply?

PN72

MS GRANT: In relation to the modern awards?

PN73

THE COMMISSIONER: Question 3.4 says “Does the agreement contain any terms or conditions of the employment that are less beneficial that equivalent terms and conditions in the reference instruments identified in questions 3.1 or 3.2?”

PN74

MS GRANT: What we have submitted there, Commissioner is that the terms and conditions of employment that are referenced in relation to the modern awards referenced are not more beneficial than the agreement. However, in terms of the reference instruments existing prior to 1 January, so the Federal awards for both the clerical and the patient services employees, we have listed there the elements of those particular reference instruments that are more beneficial than the agreement, particularly in terms of rates of pay and the elements relating to penalties and loadings under the particular instruments.

PN75

THE COMMISSIONER: The employer’s declaration says “Your answer must indicate whether all or only some employees are affected, and if only some employees are affected identify the groups of employees affected”. That required information is not identified in the employer’s declaration.

PN76

MS GRANT: Would I be able to provide that further to you?

PN77

THE COMMISSIONER: Yes.

PN78

MS GRANT: Thank you.

PN79

THE COMMISSIONER: Would you also have a look to check whether there are any less beneficial provisions?

PN80

MS GRANT: Certainly.

PN81

THE COMMISSIONER: Then the equivalent terms and conditions in the reference instruments identified in questions 3.1 and 3.2. It is required information.

PN82

MS GRANT: In think our argument in the declaration Commissioner was that in relation to the modern awards the terms and conditions - there are no terms and conditions of the relevant modern awards that are more beneficial than the agreement, but certainly I can revise that information for you and provide further submissions on that.

PN83

THE COMMISSIONER: You have, for example, identified in clause 3.5 terms and conditions that are more beneficial that the equivalent terms in the reference instruments identified in clause 3.1 and 3.2.

PN84

MS GRANT: Yes.

PN85

THE COMMISSIONER: In relation to that you say that there is an averaging of hours over 52 weeks?

PN86

MS GRANT: That is correct. In terms of - would you like me to explain how the rates of pay have been calculated?

PN87

THE COMMISSIONER: Well, I think what I would like to do today is to flag some things that immediately arise from the face of the documents but an averaging of hours over 52 weeks would be industrially atypical.

PN88

MS GRANT: Yes, it is not entirely - I mean, we really are looking at the average weekly hours of employees and that is then converted into a monetary value which is then converted to a salary, and then that salary is converted to an hourly rate within the agreement.

PN89

THE COMMISSIONER: Yes, I will certainly need to be taken by you when the matter resumes to some of the matters addressed in this employer’s declaration such as, “Please note that the loaded rates of pay which incorporate annual leave and personal leave entitlements in lieu and in advance are in all instances 12 per cent higher than the comparative unloaded rates”.

PN90

MS GRANT: This is a Victorian instrument.

PN91

THE COMMISSIONER: I know in New South Wales, under the Annual Holidays Act that casual employees are entitled to one-twelfth by virtue of the operation of the Annual Holidays Act and here you are providing 12 per cent.

PN92

MS GRANT: If I could just explain. The casual employees who are under, I believe the Clerical Victorian Award, do receive that one twelfth for annual leave. In relation to the loaded and unloaded rates within the agreement however this is just for permanent employees, so the loaded rates in the agreement for permanent employees essentially load into the hourly rate for annual and sick leave entitlements and - - -

PN93

THE COMMISSIONER: At one twelfth? Both entitlements?

PN94

MS GRANT: Under the NES the annual leave entitlement I believe is roughly 7.69 per cent, and the sick leave entitlement is approximately 3.85 per cent, the difference being really required between the unloaded and loaded rate being 11.54 per cent, and essentially the loaded rate within the agreement is a clear 12 per cent higher than the unloaded rate in the agreement which we are saying provides greater compensation in that regard to employees who are paid a loaded rate.

PN95

THE COMMISSIONER: At the bottom of that page which is unnumbered it says that “The hourly rate calculated with reference to the modern award at the end of the transitional period is $21.78 and that the hourly rate in this agreement is $20.94.

PN96

MS GRANT: Yes. The reason why we have provided the calculations in annexure A, part 2 is the fact that we have really provided two rate calculations. The first calculation is in relation to the rates set down in Schedule A of the agreement which is based on the arrangements that exist at test time, and then due to Part 4D of the Fair Work Transitional Provisions and Consequential Amendments Regulation, which provides further clarity as to the assessment of the better off overall test being that the agreement is to compete against the modern award at test time, but also on 31 July in each year of the transitional period.

PN97

In the second rate calculations we have undertaken in relation to the agreement we have actually looked at the fully transitioned modern award to ensure that employees are better off overall, not only at test time but throughout the transitional period.

PN98

THE COMMISSIONER: I’ll just touch on some preliminary matters which arise from the content of the agreement itself. At clause 4.3 it says “The hourly rate of pay for casual employees includes a casual loading and is in lieu of paid leave entitlements unless specifically mentioned otherwise in this agreement”. Coming back to this point about annual leave, and not being familiar with the arrangements that apply by operation of statute in Victoria as opposed to New South Wales, what is the position with the annual leave for casual employees?

PN99

MS GRANT: That had been taken into account in the rate calculations for casuals in Schedule A of the agreement, the first set of rate calculations for clerical employees.

PN100

THE COMMISSIONER: Now, at clause 5.2.2 of the agreement - do you have a copy of the Act with you?

PN101

MS GRANT: I do, yes.

PN102

THE COMMISSIONER: If you turn to section 172 of the Act. You will see at section 170(1)(c) of the Act it says that “An agreement that is about one or more of the following matters may be made in accordance with the this Part”. At (c) it says “Deductions from wages for any purpose authorised by an employee who will be covered by the agreement”. Similarly in section 324 of the Act, concerning permitted deductions. If you look at section 324(1)(b), “An employer may deduct an amount payable to an employee in accordance with 321(1) if relevantly the deduction is authorised by the employee in accordance with an enterprise agreement”

PN103

Clause 5.2.2 contemplates deductions that are not authorised, unilateral. I know that this is allowed under the modern award. There are different statutory provisions which apply in relation to enterprise agreements and awards, specifically section 324 of the Act provides as follows, at 324(1)(c), “The deduction is authorised by or under a modern award or an Fair Work Australia order”. So there are different statutory formulations in relation to awards and enterprise agreements. You will need to have a look at that.

PN104

MS GRANT: Thank you, Commissioner.

PN105

THE COMMISSIONER: Clause 7, on page 4 says that “The ordinary hours of work for employees will not exceed 38 hours per week on average of 26 weeks”. How does that compare with the reference instruments?

PN106

MS GRANT: In terms of the Act I note that section 63 states that “A modern award or an enterprise agreement may include terms providing for the averaging of hours of work over a specified period”. So whilst the relevant modern awards provide for averaging over a lesser period we would submit that this clause does not offend the better off overall test as it provides greater flexibility for both the employer and employees to be covered.

PN107

THE COMMISSIONER: That wasn’t my question, with respect. How does that compare with the reference instruments?

PN108

MS GRANT: My understanding is that it provides a greater averaging period in terms of averaging ordinary hours of work than provided fully in the modern awards.

PN109

THE COMMISSIONER: So that would be at least one disadvantage for the employees?

PN110

MS GRANT: We submit that it is not a disadvantage. In fact it is a greater advantage because they are afforded greater flexibility under the agreement than they would be under the relevant reference instrument.

PN111

THE COMMISSIONER: The contrary view would be that they would not attain overtime payments they would otherwise have attracted over a shorter averaging period.

PN112

MS GRANT: If I could give you further submissions on that.

PN113

THE COMMISSIONER: Yes.

PN114

MS GRANT: Thank you.

PN115

THE COMMISSIONER: Clause 7.3 says “Penalties for working additional hours must be claimed by the employee and approved by the employer in advance and in writing”. What does that mean please?

PN116

MS GRANT: We note the difficulties with that first sentence, Commissioner, and the employer has actually prepared an undertaking that if accepted would remove that first sentence of clause 7.3.

PN117

THE COMMISSIONER: When the matter resumes I’ll have a look at any proposed undertakings that you have rather than dealing with it in a piecemeal fashion. It says “Penalties for working approved additional hours are paid at time and a half for the first two hours and double time thereafter for each subsequent hour worked except for additional hours worked on Sundays which are paid at double time”. What arrangements apply on Saturdays?

PN118

MS GRANT: At the time the agreement was made employees don’t work on Saturdays.

PN119

THE COMMISSIONER: I’m looking at the agreement, not the present working arrangements.

PN120

MS GRANT: I understand. Would I be able to look into that for you?

PN121

THE COMMISSIONER: It certainly contemplates them working on Sundays.

PN122

MS GRANT: It certainly does, yes. My reading of that would be that it would be time and a half for the first two hours and double time thereafter on Saturday. Sunday obviously being double time for additional hours worked.

PN123

THE COMMISSIONER: You need to have a look at that in terms of the reference instruments.

PN124

MS GRANT: Certainly.

PN125

THE COMMISSIONER: Clause 7.4?

PN126

MS GRANT: Yes, in light of recent decisions the employer has also prepared an undertaking that if accepted would make 7.4 void and of no effect.

PN127

THE COMMISSIONER: Yes, it is a preferred hours provision.

PN128

MS GRANT: I would submit that it is slightly different from a preferred hours provision because it is really looking at additional hours that are not on an ongoing, continuous basis being worked. In that sense I think it is slightly different, but we do note recent decisions.

PN129

THE COMMISSIONER: Can I ask this? Would it have made any difference in any event given the extended averaging period in this agreement?

PN130

MS GRANT: Well, the incidence of an employee falling into an additional hours sort of arrangement would be I would think quite rare, but I don’t have instructions on that particular point.

PN131

THE COMMISSIONER: Yes, the next provision concerning rostering certainly envisages work on weekends. So the wage increases would just be the national minimum, is that the case?

PN132

MS GRANT: In line with section 206 of the Act, so looking at base rates of pay. In clause 9.1 is that?

PN133

THE COMMISSIONER: Yes.

PN134

MS GRANT: Yes, that is correct.

PN135

THE COMMISSIONER: To the extent that the wages component is the only component that is adjusted by the national minimum adjustment figures, how does that then impact on the loading component which is said to compensate for various other entitlements? Does that mean that over time that although the wages might go up the loading component would go down?

PN136

MS GRANT: The rates of pay, schedule A of the agreement, would - not really looking at clause 9.4 and those sort of adjustments, but just in terms of the schedule A rates of pay, if they fell below the base rates of pay under the award they would need to be adjusted in line with what section 206 of the Act requires.

PN137

THE COMMISSIONER: I’m not making myself clear. The wages over the life of the agreement would be adjusted by the national adjustments.

PN138

MS GRANT: If required, yes.

PN139

THE COMMISSIONER: To the extent that the hourly rates that are proposed contain a loading component, would there be adjustment of that?

PN140

MS GRANT: We would submit that that is not required under section 206 of the Act and what that means in terms of adjusting rates in an agreement in line with the base rates under the award in that regard.

PN141

THE COMMISSIONER: What would it mean for example, and I’m not sure, and subject to anything that you might say, if the loading is actually specified at these money amounts rather than, say, percentage amounts, that the money value of these would not necessarily keep pace with adjustments in the hourly rate of pay. They would in effect begin to fall backwards.

PN142

MS GRANT: Would I be able to provide further submissions on that point?

PN143

THE COMMISSIONER: Yes, certainly. Clause 11, Public Holidays, it says “This clause relates to all government gazetted public holidays in the relevant State or Territory in which work is being performed”. Is this intended to apply only to Victoria?

PN144

MS GRANT: The employer operates the business in Victoria.

PN145

THE COMMISSIONER: That was not my question. Is this intended to operate beyond Victoria?

PN146

MS GRANT: No, that is not my understanding. As the arrangements exist currently, that is not my understanding.

PN147

THE COMMISSIONER: Similarly, Traineeship Agreement, in the clause beforehand. It says “Traineeship agreement means an agreement between an employer and employee that is registered under the relevant State or Territory training authority or under a law of the State or Territory relating to the training of employees”. There are provisions in this agreement which tend to suggest it is intended to have a wider operation that might be indicated in the employer’s declaration.

PN148

MS GRANT: Could I address that separately when we provide further information?

PN149

THE COMMISSIONER: Yes.

PN150

MS GRANT: Thank you.

PN151

THE COMMISSIONER: Is clause 11 the only clause that deals with public holidays?

PN152

MS GRANT: Yes.

PN153

THE COMMISSIONER: Which public holidays are they entitled to, and if they work on public holidays what payment do they receive?

PN154

MS GRANT: The government gazetted public holidays as stated in 11.1 are the public holidays that would be applicable. In terms of payment, the hourly rates of pay at schedule A have loaded in a certain amount of public holidays so an employee who worked on a public holiday would still receive the rate of pay in schedule A, noting that that particular rate of pay is loaded in as a provision for public holidays being worked.

PN155

THE COMMISSIONER: So every employee who would be covered by this agreement would be envisaged to be receiving the loaded rate rather than for example, ordinary public holiday rates?

PN156

MS GRANT: That is correct, yes. I note in terms of the agreement calculations in annexure A of the employer declaration we have loaded in an average of four public holidays worked, across all employees. Certainly employees are getting compensated for working public holidays within the hourly rate.

PN157

THE COMMISSIONER: Clause 13, Annual Leave. This clause only applies to permanent employees, permanent employees being paid an unloaded hourly rate, so this does envisage people who are paid either the loaded rate or the unloaded rate, is that the case?

PN158

MS GRANT: That is correct. In schedule A you will note that we have rates for permanent employees and there are two sets of rates for the permanent employees, an unloaded rate and a loaded rate, both calculated essentially in the same way in that it loads in taking into account the average weekly working pattern.

PN159

THE COMMISSIONER: I must be missing something because in relation to the public holidays, I may have misunderstood things but I thought you said everybody would be paid the loaded rate and that is why public holidays aren’t dealt with here. Then the annual leave provisions then refer to permanent employees being paid the unloaded hourly rate.

PN160

MS GRANT: The unloaded and loaded hourly rate in schedule A of the agreement loads in an average of four public holidays worked, both sets of rates.

PN161

THE COMMISSIONER: Four public holidays?

PN162

MS GRANT: An average of four public holidays, across all employees, based on current work patterns.

PN163

THE COMMISSIONER: So your loadings only allow for four public holidays?

PN164

MS GRANT: That is correct, looking at the average worked, across all employees.

PN165

THE COMMISSIONER: Well, you have got four employees at the moment who would be covered by this agreement. They would have been entitled to more than four public holidays in a year.

PN166

MS GRANT: Based on the current working patters of employees and the fact that the employer herself actually works a lot of those hours on public holidays, that average is really based on what employees currently work, all employees.

PN167

THE COMMISSIONER: So you are saying to me that the hourly loading which is intended to cover entitlement payment for public holidays is only based on the inclusion of four public holidays?

PN168

MS GRANT: That is correct, four public holidays, across all employees.

PN169

MS R RYAN: Commissioner, it loads the penalty for those public holidays, not the payment for public holidays so that an employee who is not required to work on a rostered public holiday would be paid at their rate of pay, but somebody who was required to work on the public holiday, it assumed that across all employees the maximum time that they would be required to work over a year would be four. The loaded rate is not meant to compensate for payment on public holidays as such.

PN170

THE COMMISSIONER: Well, when the proceedings resume you can take me to that in more detail in that respect. Clause 13.3 reads as follows, “Subject to clause 13.4 an employee may elect to forego an entitlement to take an amount of annual leave, credited to the employee by way of a written request to the employer. Where such a request is made and approved by the employer the employee will receive a payment in lieu of the amount of annual leave at a rate no less that the employee’s agreed rate of pay at the time the election is made”. It is not entirely clear to me what that clause means but it seems to suggest that someone could work without taking any annual leave.

PN171

MS GRANT: It certainly relates to the cashing out of annual leave, pursuant to clause 13.4 of the agreement and the arrangements that would be applicable in that regard.

PN172

THE COMMISSIONER: It says “Paid annual leave entitlements - this is at clause 13.5. It says “Paid annual leave entitlements do not apply to employees who are paid a loaded rate as the cash provision is incorporated in lieu and in advance. Notwithstanding employees have an entitlement to take up to four weeks unpaid annual leave per year for the purpose of physical and mental rest and respite from work”. Perhaps it is just because of my unfamiliarity with this type of clause but it looks odd in terms of the National Employment Standards.

PN173

MS GRANT: In terms of how the loaded rate would work, and employee who is paid the loaded rate, which is 12 per cent, as we have discussed, above the unloaded rate, a person who is paid that rate would still be entitled to take their accrued annual leave, it is just that they don’t get paid for that annual leave when they take it. The hourly rate is high enough to compensate them for that entitlement in advance. We would submit that that is certainly not - - -

PN174

THE COMMISSIONER: So what provisions would apply to the taking of this unpaid leave for which they receive the casual loading?

PN175

MS GRANT: The casual loading? The loaded rate?

PN176

THE COMMISSIONER: The loaded rate.

PN177

MS GRANT: I’m sorry, in what regard?

PN178

THE COMMISSIONER: Well, the National Employment Standards would apply to the taking of leave generally. This has an atypical and unusual formulation in relation to annual leave and it does not detail, for example, the circumstances when it must be taken, when it may be taken. I’m talking about the unpaid annual leave here.

PN179

MS GRANT: Those arrangements would be the same as if an employee was on an unloaded rate and being paid for their annual leave entitlement. If the entitlement is still there they are still entitled to take their accrued leave, it is just that the payment is the difference I guess for the loaded rate employees.

PN180

THE COMMISSIONER: I would ask to be taken back to that when the matter resumes.

PN181

MS GRANT: Certainly.

PN182

THE COMMISSIONER: Clause 14, Sick and Carer’s Leave. Clause 14.2.4 says “An immediate family member is a spouse, child, parent, grandparent, grandchild or sibling of an employee, or a child, parent, grandparent, grandchild or sibling of a spouse of the employee”. It is unlawfully discriminatory. It does not include same sex partners.

PN183

MS GRANT: In that regard Commissioner, I note that section 12 of the Act contains a reference to a de-facto partner to include a same sex partner, and references in the agreement in relation to carer’s leave and compassionate leave and parental leave that make reference to spouse would, we submit, by virtue of the NES and the Act include same sex partners, but I can certainly - - -

PN184

THE COMMISSIONER: No, this agreement specifically refers to spouse and there are different definitions of spouse and de-facto partner in the Act.

PN185

MS GRANT: I can certainly speak with the employer and seek instructions as to how that clause can be - - -

PN186

THE COMMISSIONER: No, de-fact partner for a national system employer means “(a) a person who although not legally married to the employee lives with the employee in a relationship as a couple on a genuine domestic basis whether the employee and the person are of the same sex or different sexes, and (b) includes a former de-facto partner of the employee”. Spouse is defined as including a former spouse, and we know what spouse is. I think that the definition which is discriminatory on its face is immediate family member. It then pervades some of the other paid and unpaid leave entitlements, but you would need to go through those.

PN187

MS GRANT: Certainly. Parental Leave, and it says “Parental leave entitlements are in accordance with the Act and apply to permanent and eligible casual employees”. The Act is defined as the Fair Work Act et cetera. Long service leave, on the same page, says “Employees are entitled to long service leave in accordance with the Act”. What would you say would be the position in relation to that? Is it some state based long service leave Act?

PN188

MS GRANT: The reference to the Act is correct. It refers to the Fair Work Act as defined in the clause 2 definitions. If you would prefer me to revise that or - - -

PN189

THE COMMISSIONER: It is really a matter for you and your client as to what you propose but I am just raising some preliminary matters about the application. So is there a Victorian long service leave act or has that all gone by the by?

PN190

MS GRANT: There is, yes, I believe so.

PN191

MS RYAN: I think Commissioner that it has that broader reference to the Fair Work Act because the long service leave provision in the NES would also come in circumstances where an employee may have an entitlement different to the State statutory provision by virtue of their NAPSA which may come across with them.

PN192

THE COMMISSIONER: Yes. Clause 22.3, what is the usual position with redundancy payments for trainees? Is it dealt with in the Act? Certainly nothing unusual about the serious misconduct or the casual employees.

PN193

MS GRANT: I believe so, Commissioner.

PN194

THE COMMISSIONER: Good. If you can take me to it, I just can’t immediately locate it. It may well be there in section 123.

PN195

MS GRANT: Subsection (d), yes.

PN196

THE COMMISSIONER: Would these trainees under this agreement be under a specified period arrangement, limited to the duration of the training arrangement?

PN197

MS GRANT: That is correct, for a specified period.

PN198

THE COMMISSIONER: Clause 23, Stand down. Are there equivalent provisions in the reference instruments?

PN199

MS GRANT: I would have to consult with those, Commissioner. Would I be able to provide that further information?

PN200

THE COMMISSIONER: Yes, certainly.

PN201

MS GRANT: Thank you.

PN202

THE COMMISSIONER: Clause 24, Meal Breaks. It says “Employees who work a shift of 5 hours or more duration are entitled to an unpaid meal break of 30 minutes in accordance with the provisions of this agreement. The meal break is to be taken at a time agreed between the employer and the employee taking into account the operational requirements”. Ordinarily there would be some arrangement that if the meal break wasn’t provided the employee would be entitled to penalty rates for the want of a better description. Are there any such provisions in any of the instruments?

PN203

MS GRANT: I believe in the modern awards. I believe there are, and certainly the meal break provision at 24.1 and in clause 24.2, the rest breaks, has been derived directly from the modern award.

PN204

THE COMMISSIONER: If I take you to the Clerks Private Sector Award, clause 26.1 reads as follows. “Subject to the provisions of clause 28, Shiftwork, a meal period of not less than 30 minutes and not more than 60 minutes must be allowed to each employee. Such meal period must be taken not later than 5 hours after commencing work and after the resumption of work from a previous meal break. Employees required to work through meal breaks must be paid double time for all time so worked until a meal break is allowed”.

PN205

MS GRANT: Would we be able to revise that Commissioner?

PN206

THE COMMISSIONER: These are things that just arise from my preliminary reading of the document. I have a statutory declaration saying there are no disadvantages as against the modern award for example. I haven’t gone to the other instruments. You say you would have submissions to make in relation to that, and you have just submitted to me that this was a direct lift from the modern awards.

PN207

MS GRANT: That was my understanding.

PN208

THE COMMISSIONER: Yes. Rest break provisions, are they dealt with in this agreement?

PN209

MS GRANT: They are, in 24.2.

PN210

THE COMMISSIONER: You might need to have a look at that provision as well. The Savings clause at clause 28 of the agreement, it says “This agreement will not reduce the aggregate earnings per hour or week, as the case may be, of existing employees assuming identical rosters and hours are agreed and worked by the employee to those for the period one month prior to the operation of this agreement”, could you explain to me what this means please?

PN211

MS GRANT: Certainly. This just ensures that existing employees, when essentially being carried over to this new agreement are not being paid less than they would have previously. So there rate of pay is not going to be reduced essentially by being covered by this new proposed agreement.

PN212

THE COMMISSIONER: Will other new employees have their rates of pay reduced?

PN213

MS GRANT: This savings clause specifically refers to existing employees.

PN214

THE COMMISSIONER: As I understand it the better off overall test would involve a comparison of the relevant instruments, not the position of individual employees under the relevant instruments contingent on whether they have been employed before or after. My question is, does this agreement, considered in terms of the reference instruments disadvantage employees? I see that there is a form of a savings clause here. Is it envisaged that these four employee’s wages would have dropped but for the operation of this savings clause?

PN215

MS GRANT: That is not envisaged, no. I mean, I don’t have instructions as to each individual employee, it is really just a clause that ensures that existing employees will not be - that their aggregate earnings per week will not be reduced essentially, under the agreement that is proposed.

PN216

THE COMMISSIONER: I’m told that this is better off overall.

PN217

MS GRANT: That is correct.

PN218

THE COMMISSIONER: What is the need then for a savings clause of this nature?

PN219

MS GRANT: Better off overall in relation to a comparison between the agreement and the modern award.

PN220

THE COMMISSIONER: You flagged that there were some areas where you are going to propose some undertakings, are there any other, just for my consideration before the next listing of the matter where you were proposing to put forward any other undertakings?

PN221

MS GRANT: The undertakings proposed at this point, Commissioner, related to clause 7.3 and clause 7.4 of the agreement.

PN222

THE COMMISSIONER: Thank you. They were the matters that I wished to raise as preliminary matters in relation to the enterprise agreement. I have to say that perhaps my strongest concern about the application is the fact that a very small number of employees voted for an agreement which covered classifications beyond their own. There have been a number of decisions now about agreements that do this. You may wish to have a look at them before you come back. I’m just not sure that is open. How long would you like before you come back?

PN223

MS GRANT: Is two weeks appropriate?

PN224

THE COMMISSIONER: Certainly. Well, today is the 3rd. I could give you any time presently on either the Monday or the Tuesday, whichever is convenient to you on Monday the 17th or Tuesday the 18th.

PN225

MS GRANT: Monday the 17th is fine.

PN226

THE COMMISSIONER: Would you prefer it morning or afternoon.

PN227

MS GRANT: Morning would be preferable thank you.

PN228

THE COMMISSIONER: Ten o’clock?

PN229

MS GRANT: Ten o’clock is fine, thank you. Is the employer representative, Ms Heather Stevenson, required to attend on that particular day?

PN230

THE COMMISSIONER: She would be coming in from Melbourne would she?

PN231

MS GRANT: She is based in Melbourne, so whether or not she would be - - -

PN232

THE COMMISSIONER: No. Thank you very much for your submissions.

<ADJOURNED UNTIL MONDAY 17 MAY 2010 [10.00AM]