[2010] FWAFB 1091
FAIR WORK AUSTRALIA
DECISION
Workplace Relations Act 1996
s.576H—Commission may vary modern awards
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch 5, Item 14—Variation of modern award
Construction, Forestry, Mining and Energy Union
(AM2009/19)
ELECTRICAL POWER INDUSTRY AWARD 2010
[MA000088]
JUSTICE GIUDICE, PRESIDENT
VICE PRESIDENT LAWLER
VICE PRESIDENT WATSON
SENIOR DEPUTY PRESIDENT WATSON
SENIOR DEPUTY PRESIDENT HARRISON
SENIOR DEPUTY PRESIDENT ACTON
COMMISSIONER SMITH
MELBOURNE, 25 FEBRUARY 2010
[1]
This decision concerns an application by the Construction, Forestry, Mining and
Energy Union (Mining and Energy Division) (CFMEU) to vary the Electrical Power Industry
Award 20101(the modern award). The application was made pursuant to s.576H of the
Workplace Relations Act 1996 (the WR Act) and was not determined by 31 December 2009.
The application will be determined by Fair Work Australia pursuant to item 14 of Schedule 5
to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009.2
[2]
The application relates to proposals to:
(a)
preserve the ordinary hours of work clauses in the award; and
(b)
introduce a minimum of three hours payment per engagement for part-time
employees.
Ordinary Hours of Work
[3]
Clause 11 of the modern award provides that “[a] full time employee is one who
works an average of 37.5 hours per week.” The CFMEU seeks the insertion of a new clause
11A in the following terms:
“11.A Where an employer was required as at 31 December 2009 to provide its
employees under an award-based transitional instrument with an entitlement to
ordinary hours less than those specified in clause 11 (including pro rata
entitlements for part-time and casual employees), the lesser ordinary hours will
not be increased as a result of the commencement of this award.”
[4]
Under the pre-reform awards and Notional Agreements Preserving State Awards
(NAPSAs) in the electrical power industry, the number of hours that constituted full time
hours varied across Australia in the range from 35 to 38 hours per week. The exposure draft,
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which was expressed to cover employers and relevant employees “throughout Australia”,
specified full time hours as an average of 37.5 hours per week. That figure represented a
qualitative assessment of the figure that would best balance the competing interests of
employers and employees having regard to the full time weekly hours specified in the
underlying pre-reform awards and NAPSAs. In their post exposure draft submissions both the
CFMEU and the national employer group (NEG) accepted the specification of the full time
hours in the exposure draft and it duly appeared in the modern award as made. The CFMEU’s
acceptance was made in circumstances where transitional issues for the electrical power
industry were yet to be determined and, it is said, in the expectation that employees who had
the benefit of pre-reform award/NAPSA full time hours that were less than 37.5, particularly
in NSW and Queensland, would be subject to a transitional provision which would preserve
those lesser full time hours for the transitional period.
[5]
The first substantive consideration of transitional issues occurred in relation to
transitional provisions for the Priority and Stage 2 modern awards. It was certainly apparent
to a major party such as the CFMEU that the decision made in relation to those provisions
would necessarily canvass and decide a number of issues of general application, including,
potentially, a general transitional approach in relation to hours of work. Written submissions
on transitional provisions for the Priority and Stage 2 modern awards were due on 29 May
2009. Submissions in reply were due on 26 June 2009. Oral consultations were held on
13 July 2009. A decision was made on 2 September 2009 (Transitional Decision).3
[6]
Award modernisation for the electrical power industry was dealt with as part of
Stage 3. The exposure draft was published on 22 May 2009. Written submissions on the
exposure draft were due on 12 June 2009. Oral consultations were held on 26 June 2009. The
modern award was made on 4 September 2009. Written submissions on transitional issues for
Stage 3 Awards were due on 23 October 2009. Written submissions by way of reply on
transitional issues for Stage 3 were due on 6 November 2009. A decision on those issues was
issued on 3 December 2009.
[7]
In the Transitional Decision, the Full Bench rejected transitional phasing provisions in
relation to alterations to hours of work arrangements:
“[24] The matters we have decided to include in the model provisions relating to
phasing are: minimum wages, including wages for junior employees, employees to
whom training arrangements apply and employees with a disability, casual and parttime loadings, Saturday, Sunday, public holiday, evening and other penalties and shift
allowances. A number of parties suggested that we should include transitional
provisions relating to hours of work provisions. Proposals were advanced dealing
with changes in the spread of ordinary hours, starting and finishing times and the
number of hours of overtime required to be worked at certain rates. While these
matters are capable of affecting the pay employees receive and the costs to
employers, we have decided not to include phasing provisions in relation to them.
There are three reasons. The first is that an employer normally has award rights to
alter starting and finishing times and other elements of ordinary hours by giving
notice to the employee concerned. Changes of this nature can obviously affect
overtime and shift payments. Where such rights are exercised it would be difficult to
quantify the effect of the modern award in that respect. Secondly, the award
flexibility provision might be too difficult to apply if matters other than those we have
chosen were to be subject to transitional arrangements. Thirdly, as we have already
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pointed out, the greater the number of matters which are subject to transitional
provisions the greater the scope for complexity and confusion in the application of the
provisions.”4
[8]
In its statement on 26 June 2009 setting out its general approach to modern award
variations filed in the period to 31 December 2009 the Full Bench observed that:
“[3] Applications to vary the substantive terms of modern awards will be considered
on their merits. It should be noted, however, that the Commission would be unlikely
to alter substantive award terms so recently made after a comprehensive review of the
relevant facts and circumstances including award and NAPSA provisions applying
across the Commonwealth. Normally a significant change in circumstances would be
required before the Commission would embark on a reconsideration.” 5
[9]
The CFMEU relies upon the Transitional Decision and, in particular, the general
decision not to include phasing provisions in relation to hours of work, as a change in
circumstances in the relevant sense. We do not regard a matter decided in the Transitional
Decision as a relevant change of circumstances. On the contrary, parties were on notice that
for any industry, any type of award entitlement that varied from State to State might or might
not be amenable to a transitional provision. Parties interested in award modernisation for
industries in Stage 3 were not entitled to presume any particular outcome in relation to general
transitional issues that were canvassed in relation to Priority and Stage 2 modern awards and,
moreover, those parties, the CFMEU included, had an opportunity to seek to make
submissions in relation to such issues. For the purposes of the Stage 3 industries, parties ought
reasonably have proceeded on the basis that a range of outcomes were possible in relation to
general transitional issues, including a decision that there would be no phasing provisions in
relation to particular types of award entitlement. In this context, the fact of a particular
outcome in the Transitional Decision does not constitute a significant change of circumstance
of the sort contemplated by the Full Bench in its statement on its general approach to modern
award variations.
[10] Nevertheless, we have in any event considered the CFMEU’s application in relation to
hours of work on its merits and have decided to reject it. The proposed variation would have
the effect of permanently entrenching, for some employees, full time hours of work that are
different from those prevailing for other employees in Australia on the basis of existing prereform award or NAPSA entitlements. The clear legislative intent of Part 10A of the WR Act
and, in particular, s.576T, was that modern awards should, subject to a transitional period of 5
years, operate uniformly throughout the States and Territories of Australia. While we do not
see the provision, for example, of district allowances that are designed to compensate for
particular disabilities associated with working in a particular location as infringing that basic
legislative purpose, we regard the hours of work variation proposed by the CFEMU as
fundamentally contrary to the legislative intent behind s.576T of the WR Act.
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Minimum daily engagement for part-time employees
[11] The CFMEU seeks the inclusion of a new cl.12.1A which would provide for a
minimum engagement of 3 hours for part-time employees. There has been no relevant change
of circumstances. Moreover, the CFMEU incorrectly contends that a three hour minimum
engagement for part-time employees “was erroneously removed from the exposure draft of
the modern award.” The exposure draft contained no such provision. We are not persuaded
that a case has been made out to vary the modern award in the manner sought by the CFMEU.
PRESIDENT
** end of text **
1
MA000088.
Schedule 5 was modified by the Fair Work Legislation Amendment Regulations 2009 (No.2) on 14 December 2009.
3 [2009] AIRCFB 800.
4 Ibid at para 24.
5 [2009] AIRCFB 645 at para 3.
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