1
Fair Work Act 2009
s.604 - Appeal of decisions
Mitolo Group Pty Ltd
v
National Union of Workers
(C2014/7871)
VICE PRESIDENT HATCHER
DEPUTY PRESIDENT LAWRENCE
COMMISSIONER CARGILL SYDNEY, 21 APRIL 2015
Appeal against decision [2014] FWC 7682 & [2014] FWC 7981 of Deputy President Bartel
at Adelaide on 31 October 2014 and 11 November 2014 in matter number AG2014/1736.
Introduction
[1] The Mitolo Group Pty Ltd (Mitolo) seeks permission to appeal, and appeals, against
two decisions of Deputy President Bartel. The decisions concerned an application by Mitolo
for the approval of the Mitolo Group Horticultural Production Employees Collective
Agreement 2014 (Agreement). In the first decision, issued on 31 October 20141 (Decision),
the Deputy President found that, for the purpose of the application of the better off overall test
in s.193(1) of the Fair Work Act 2009 (FW Act), the relevant modern award was the Storage
Services and Wholesale Award 20102 (Storage Services Award) and not the Horticulture
Award 20103 (Horticulture Award) and on that basis the Agreement did not satisfy the better
off overall test. The Deputy President provided Mitolo the opportunity to provide
undertakings pursuant to s.190 that would permit the Agreement to be approved, but in the
second decision issued on 11 November 2014 (Further Decision)4, the Deputy President noted
that Mitolo had declined to provide any undertakings and therefore dismissed its application
for approval of the Agreement.
[2] Although Mitolo’s notice of appeal is, in formal terms, directed to both of the
identified decisions, its grounds of appeal and its submissions are concerned only with the
finding in the Decision that, for the purpose of the better off overall test, the Storage Services
Award and not the Horticulture Award was the relevant award. Mitolo contends that this
finding was in error, that the Agreement satisfied the better off overall test when compared to
the Horticulture Award, and that the Agreement should have been approved on this basis. It
1 [2014] FWC 7682
2 MA000084
3 MA000028
4 [2014] FWC 7981
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DECISION
E AUSTRALIA FairWork Commission
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sought that permission to appeal be granted, the decisions be quashed, and the Agreement be
approved.
[3] It should be noted that Mitolo did not, in the alternative, challenge the Deputy
President’s finding that the Agreement failed the better off overall test by reference to the
Storage Services Award. Therefore this appeal is concerned only with the issue of which
modern award applied to the employees of Mitolo who would be covered by the Agreement if
it took effect.
The Agreement
[4] No provision of the Agreement is, in terms, concerned with the scope of its coverage.
Clause 2 of the Agreement is the provision which comes nearest to dealing with the issue of
coverage. It provides:
“2. PARTIES TO THE AGREEMENT
2.1 This Agreement is BETWEEN the Company AND the Company’s
Horticultural Production Employees located at Angle Vale Road, Virginia SA
5120 and properties as assigned as covered by the Classification Structure of
this Agreement.”
[5] “Company” is defined in subclause 6.4 of the Agreement to mean Mitolo. The
expression “Horticultural Production Employees” is not defined.
[6] Clause 5 of the Agreement is entitled “Objectives of the Agreement”. Subclause 5.2
provides:
“5.2. The terms of this Agreement are aimed at providing, in a competitive market
place, facilities that are engaged principally in horticultural production including
seed treatment, preparation, trials and harvest and washing, grading, quality
checking and packing of horticultural crops that aligns with the vision and goals
of the Company. The Company and its Employees recognise the contribution of
all parties to this Agreement in setting a framework for increased productivity
and profitability, for the long-term security of Employees.”
[7] Clause 13 of the Agreement is concerned with the classification and work
requirements of employees, and provides:
“13. CLASSIFICATION AND WORK REQUIREMENTS
13.1. An Employee's engagement under this Agreement is in accordance with the
Classification Structure set out in Schedule B of this Agreement. An Employee,
subject to their qualifications, experience and fitness, is required to perform all of the
tasks of the position, including those tasks that are incidental or of a lower
classification to the main functions of their position.
13.2. An Employee's allocation to tasks and the location of work will be at the
Company's direction considering operational requirements. This includes but not
limited to;
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13.2.1. Performing harvest duties at Virginia and surrounding properties
during peak harvest season (September-January)
13.2.2. Taking product samples prior to harvest from various company farms
to detect variables affecting production.”
[8] The classification structure referred to in clause 13 as being set out in Schedule B
contains five levels, each of which contains classification criteria under a number of
subheadings. All five levels contain the subheadings of “General description” and “Indicative
duties”; levels 1 to 4 contain the subheading “Promotional criteria”, and levels 2 to 5 contain
the subheading “Points of entry”. It was observed by the Deputy President in the Decision,
and not challenged by any party in the appeal, that the classification structure in the
Agreement was “closely aligned” to that in the Horticulture Award, that the General
description criteria for the five levels in the Agreement was identical to those in the
Horticulture Award, and that the Indicative duties criteria for each level in the Agreement
were based on those in the Horticulture Award with some modifications, additions and/or
deletions, the most significant of which related to seed shed functions.5 The Deputy President
set out the indicative duties for each level in the Decision with the seed shed functions
emphasised, and we reproduce this here:
“Level 1 Employee
...
Performs general labouring duties;
Fruit or vegetable picking, thinning or pruning;
Operates small towing tractor engaged in transfer of produce bins and other
containers;
Performing a range of housekeeping tasks and participates in 5’s activities in
premises and grounds;
Sorting, packing or stacking of produce where this requires the exercise of
minimal judgement;
Horticultural crop and seed grading with less than 3 months experience that
requires the exercise of minimal judgement;
Performs basic recording functions related to work performed at this level;
Provides assistance within the scope of this level to other Employees as required;
May be undertaking structured training to enable entry into Level 2
...
Level 2 Employee
...
Performing a range of tasks involving the set up and operation of production
and/or packing, stacking or labelling equipment;
Repetition work on automatic, semi-automatic or single purpose machines or
equipment;
Performing minor maintenance/assembling/dismantling using basic written,
spoken and/or diagrammatic instructions in a production environment;
Sorting, packing or stacking of produce;
5 Decision at [13]
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Horticultural crop and seed grading with more than 3 months experience and
is able to demonstrate competency in grading techniques including but not
limited to varieties, product defects, and is able to grade to customer
specifications;
Cutting, treating and fertilising seed;
Maintains simple records and performs basic data entry;
Uses hand trolleys, pallet trucks or other mechanical or power driven lifting or
handling devices not requiring a licence;
Operates tractors with engine capacity of up to 70 kW;
Cleaning and sanitising of horticultural production equipment and environs in
accordance with HACCP plans and cleaning schedules;
Housekeeping duties beyond the scope of Level including but not limited to staff
amenities i.e. toilets and lunch areas;
General and routine product testing;
Provides assistance within the scope of this level to other Employees as required;
Assists in the provision of on-the-job training in conjunction with supervisors,
tradespersons or trainers; including
May be undertaking structured training to enable entry into Level 3
...
Level 3 Employee
...
Driving motor lorries or forklifts;
Operates tractors with engine capacity of over 70 kW;
Minor maintenance of plant;
Assists in the training, instruction and coordination of Employees;
Records detailed information on production and quality indicators;
Provides assistance within the scope of this level to other Employees;
Undertakes further training so as to enable advancement to Level 4
...
Level 4 Employee
...
Using precision measuring instruments;
Operation of pre-packaging machinery including but not limited to machine run
out, change over, set up and coding, loading of packaging consumables, operation
and monitoring;
Inventory and store control;
Licensed operation of all appropriate materials handling equipment;
Basic engineering and fault handling;
Basic non-trades maintenance involving the use of tools and equipment within the
scope of this Agreement;
Water and temperature testing, chemical application and adjustments for produce
washing processes;
Licensed and certified to operate engine driving and crane driving operation;
Performs quality checks on the work of others;
Quality assurance/control;
Accurate data entry for the coding and wrapping of graded and packed produce in
accordance with customer specification and company requirements;
Assists in the provision of on-the-job training
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Monitors variables affecting production yields, detects errors, investigates causes
and recommends collective/preventative action;
Provides assistance within the scope of this level to other Employees;
Exercises good interpersonal communications skills;
Undertakes further training so as to enable advancement to Level 5
...
Level 5 Employee
...
Inspects products and/or materials for conformity with established operational
standards and approves/passes first off samples;
Raising, planting, treatment and management of farm seed including but not
limited to plant trials;
Operates, sets up and adjusts maintenance functions including (but not limited to):
o Removing equipment fastenings including use of destructive cutting
equipment;
o Running adjustments to production equipment;
Operates all lifting equipment;
Basic production scheduling and materials handling within the scope of production
process or directly related functions;
Exercises high level stores and inventory responsibilities;
Provides on-the-job training
Provides assistance within the scope of this level to other Employees.”
Horticulture Award
[9] The coverage of the Horticulture Award is set out in clause 4, which relevantly
provides:
“4.1 This industry award covers employers throughout Australia in the horticulture
industry and their employees in the classifications listed in Schedule B—Classification
Structure and Definitions, to the exclusion of any other modern award.
4.2 Horticulture industry means:
(a) agricultural holdings, flower or vegetable market gardens in connection
with the sowing, planting, raising, cultivation, harvesting, picking, packing,
storing, grading, forwarding or treating of horticultural crops, including fruit
and vegetables upon farms, orchards and/or plantations; or
(b) clearing, fencing, trenching, draining or otherwise preparing or treating
land for the sowing, raising, harvesting or treating of horticultural crops,
including fruit and vegetables.
4.3 Horticulture industry does not mean:
(a) the wine industry;
(b) silviculture and afforestation;
https://www.fwc.gov.au/documents/documents/modern_awards/award/MA000028/ma000028-36.htm#P665_57985
https://www.fwc.gov.au/documents/documents/modern_awards/award/MA000028/ma000028-36.htm#P665_57985
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(c) sugar farming or sugar cane growing, sugar milling, sugar refining, sugar
distilleries and/or sugar terminals;
(d) any work in or in connection with cotton growing or harvesting; cotton
ginneries and associated depots; cotton oil mills and the extraction of oil from
seed;
(e) plant nurseries; or
(f) a broadacre mixed farming enterprise as defined in the Pastoral Award
2010.
. . .
4.9 Where an employer is covered by more than one award, an employee of that
employer is covered by the award classification which is most appropriate to the work
performed by the employee and to the environment in which the employee normally
performs the work.
NOTE: Where there is no classification for a particular employee in this award it is
possible that the employer and that employee are covered by an award with
occupational coverage.”
[10] The only expression used in the definition of “horticulture industry” in subclause 4.2
above which is defined in the Horticulture Award is “horticultural crops”. It is defined in
clause 3 as follows:
“horticultural crops includes all vegetables, fruits, grains, seeds, hops, nuts, fungi,
olives, flowers, or other specialised crops unless they are specifically named as a
broadacre field crop in the Pastoral Award 2010.”
[11] We have earlier described the classification structure in the Horticulture Award by
reference to its similarity to that in the Agreement, and it is not necessary to set out that
classification structure here.
Storage Services Award
[12] The coverage of the Storage Services Award is set out in clause 4, which relevantly
provides:
“4.1 This industry award covers employers throughout Australia in the storage services
and wholesale industry and their employees in the classifications listed in clause 14—
Classifications.
4.2 Notwithstanding clause 4.1, the award does not cover:
(a) an employer to the extent that the employer is covered by another modern
award that contains classifications relating to functions included within the
definition of the storage services and wholesale industry with respect to any
employee who is covered by that award;
. . .
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4.6 Where an employer is covered by more than one award, an employee of that
employer is covered by the award classification which is most appropriate to the work
performed by the employee and to the environment in which the employee normally
performs the work.
NOTE: Where there is no classification for a particular employee in this award it is
possible that the employer and that employee are covered by an award with
occupational coverage.”
[13] The expression “Storage services and wholesale industry” is defined in subclause 3.1
as follows:
“storage services and wholesale industry means the receiving, handling, storing,
freezing, refrigerating, bottling, packing, preparation for sale, sorting, loading,
dispatch, delivery, or sale by wholesale, of produce, goods or merchandise as well as
activities and processes connected, incidental or ancillary”
[14] The classification structure in Schedule B of the Storage Services Award is made up of
eight classifications: Storeworker Grades 1-4 and Wholesale Employee Levels 1-4. It is not
necessary for present purposes to set out the entirety of the classification; it is sufficient to
note that the indicative tasks of a Storeworker include “storing and packing of goods and
materials in accordance with appropriate procedures and/or regulations” and “receiving
goods, assembling orders, picking for processing” and those of a Wholesale Employee
include “the receiving and preparation for sale and/or display of goods”, “the pre-packing or
packing, weighing, assembling, pricing or preparing of goods or provisions or produce for
sale” and “the wrapping or packing of goods for dispatch and the dispatch of goods”.
Relevant to the classification of Wholesale Employee, the word “wholesale” is defined in
subclause 3.1 of the Storage Services Award to mean “the sale of commodities in large
quantities other than to final consumers”.
The Decision
[15] In her Decision the Deputy President made a number of findings of fact which were
relevant to her determination concerning award coverage. In relation to the group of
companies to which Mitolo belonged (Mitolo Group), the Deputy President found:
“[8] The employer is one of a number of companies within the Mitolo Group. There are
at least four employing entities within the Mitolo Group, including the employer;
Mitolo Management Pty Ltd; Mitolo Vineyards Pty Ltd; and Maranello Trading Pty
Ltd.
[9] The employer has approximately 190 employees, predominantly involved in
handling potatoes and onions on site. An Agronomist, a Seed Manager, a Technical
Manager and a Work Health and Safety Coordinator are also engaged at the site and
provide services to other companies within the Mitolo Group. The site itself is owned
by two Mitolo Group holding companies.
[10] Mitolo Management Pty Ltd employs the Group Human Resources Manager
(Ms Hentschke) and the Chief Financial Officer, both of whom provide services across
the Mitolo Group. Mitolo Vineyards Pty Ltd employs vineyard workers in the
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Riverland. Maranella Trading Pty Ltd employs Farm Managers and workers at farms
owned by the Mitolo Group, primarily in the Riverland and at Pinnaroo. Several farms
in close proximity to the employer’s Angle Vale Road site are operated by Maranella
Trading Pty Ltd, although only few if any workers are based there. Some employees of
the employer perform work on these properties.”
[16] In relation to the operations at Mitolo’s Angle Vale Road site, the Deputy President
found:
“[14] The produce at the Angle Vale Road site comprises 80% potatoes and 20%
onions. Ninety-five per cent of the total produce is sourced from Mitolo Group owned
farms. This produce is transported to the Angle Vale Road site in four tonne bins on
Mitolo Group fleet trucks, which also transport the packaged product from the Angle
Vale Road site.
[15] The process undertaken at the site with potatoes involves the removal of foreign
debris; washing; chemical treatment; grading according to specification and customer
requirements; waste removal; and bagging (including labelling with ‘use by’ dates).
The finished product is put into crates and stacked onto pallets before a final quality
inspection is undertaken. Pallets are wrapped and coded and moved to the cool room
by forklift to await dispatch. A similar process, save for washing, takes place for
onions.
[16] The production process is mechanised. A filtration/water recycling system is in
operation using water from dams on the Angle Vale Road site. Soil washed off the
potatoes is filtered from the water and deposited on the property. Waste trucks
transport large volumes of wasted potato as feed for Mitolo Group stock or for the
stock owned by local farmers.
[17] Company seed is managed on site and this includes seed trials, treatment and
cutting of seed. The seed is dispatched to Mitolo Group properties. Work performed
on other properties includes standing on the back of harvesters grading out rocks and
other debris, waste produce and mud; standing on the back of a planter ensuring even
distribution of seed; and general labouring duties such as weeding and planting trees.
[18] Emails from Ms Hentschke to Mr Garland in June 2014 identified 188 employees
who will be covered by the Agreement, broken down by title, classification level and
number, as follows:
Horticultural Graders (Level 1 & 2) 84
Product Inspector (Level 5) 6
Potato Wash Operators (Level 4) 4
Wash Labourers (Level 1) 3
Labourers (Level 2) 33
Labourers (packing produce) (Level 1) 18
Produce Tipper (Level 3) 3
CVS Operator (Level 5) 2
In line Grading Quality Control (Level 5) 5
Forklift Drivers (Level 3) 5
Produce Machine Operator (Level 4) 8
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Wrap (Coding products) (Level 4) 2
Minor Maintenance (Level 3) 2
Supervisors (Level 5) 8
Seed Shed
Horticultural Graders/Cutters (Level 1 & 2) 4
Seed Supervisor (Level 5) 1
Seed Labourer (Level 3) 1
[17] The Deputy President then made the following findings concerning the industrial
coverage of Mitolo and its employees at the Angle Vale Road site:
“[19] The employer and its employees are currently bound by the Mitolo Group
Employee Collective Agreement Process Workers (“the 2008 Agreement”) which is an
agreement made under the Workplace Relations Act 1996, as amended.
[20] At the time the 2008 Agreement was approved, the employer was a respondent to
the South Australian Vegetable Processing (NUW) Award 2003 (“the Vegetable
Processing Award”). This Award became a transitional instrument and its coverage
was subsequently incorporated into the Storage Services Award. The coverage of the
Vegetable Processing Award was expressed as follows:
‘6. COVERAGE OF AWARD
This award applies in respect of all persons employed in South Australia in the
vegetable processing industry, including persons engaged in, or in connection
with:
6.1 the reception, handling, storing, preparation, packing, distribution, delivery
or forwarding of vegetables; or
6.2 any other processing of vegetables.’
[21] The 2008 Agreement classification structure reflects, in identical terms, the
classification structure of the Vegetable Processing Award. It has some similarity to
the classification structure in the Agreement, with the most obvious difference being
the absence of indicative duties relating to the seed shed and the absence of any
reference to work performed ‘off-site’ in the 2008 Agreement.”
[18] The Deputy President characterised the issue of the relevant modern award as being a
question of fact and law, and went on to say that “The facts as to the work performed at the
Angle Vale Road site are not in dispute and any dispute concerning the processes and
activities that are undertaken is of negligible or no weight”.6 The Deputy President then
interpreted subclause 4.2(a) of the Horticulture Award as being that “horticulture industry”
meant:
“[77] ... agricultural holdings, flower or vegetable market gardens in connection with
the activities of sowing, planting, raising, cultivation, harvesting, picking, packing,
6 Decision at [74]
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storing, grading, forwarding or treating of horticultural crops and this includes fruit
and vegetable on farms, orchards and/or plantations.”
[19] The Deputy President then found (emphasis added):
“[78] While a number of the activities undertaken at the Angle Vale Road site are
included within the activities in the definition of “horticulture industry”, the important
qualification on those activities, namely where they are undertaken, is not met in any
substantial way.”
[20] Reference was then made to the Fair Work Australia decision in National Union of
Workers7, and the Deputy President said in relation to the conclusion in that decision
(emphasis added):
“[82] I respectfully agree with this conclusion. The distinction between the common
activities in the two modern awards is the environment in which they are undertaken.”
[21] The Deputy President then stated the following conclusions about the issue of award
coverage:
“[83] It follows that I am not persuaded by the employer’s argument that sub-clause
4.2(b) the Horticulture Award operates to expand the coverage of the horticulture
industry because it does not specify that the activities listed therein must be
undertaken upon a farm, orchard and/plantation. In my view there is no need for such
a qualification in the context of the activities identified. Sub-clause 4.2(b) is confined
to activities associated with “... preparing and treating land for the sowing, raising,
harvesting or treating of agricultural crops”.
[84] I accept the evidence and submissions of the employer and representatives in
support, that the indicative duties in the classifications under the Horticulture Award
are more aligned with the activities undertaken by employees. Nonetheless, the
classification definitions in the Storage Services Award are capable of covering the
work performed by employees, including at B.1.2(f)(i); B.2.2(e)(i); B.3.2(a);
B.3.2(f)(iv); B.5.1(b); B.5.1(g); and B.6.2(a) of the classification schedule.
[85] In relation to the activities undertaken in the seed shed and the work of employees
on Mitolo Group owned farms in the vicinity of the Angle Vale Road site, I have
reached the following conclusions. The operation of the seed department is an
important element in the horticultural activities of the Mitolo Group, however in the
context of the employer’s operations it is of lesser weight. The staff dedicated to the
seed trials and other seed related activities represent only a small proportion of the
total employees covered by the Agreement (at best 6 out of 188 employees or just over
3%).
[86] The main resources of the Angle Vale Road site are directed to the washing,
grading, treatment, and packing of potatoes and onions. The resources directed to
these activities include the work of employees directly undertaking this work and
those in supervisory and quality control positions; machinery and equipment
7 [2010] FWA 8228
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associated with these activities including hoppers, conveyer belts, grading lines,
bagging machines and the water recycling and filtration system; the employees
involved in the maintenance of this equipment/system; the movement of produce
within the site; and the cool rooms for produce awaiting dispatch. The substantial
character of the employer fits within the definition of ‘storage services and wholesale
industry’ as defined in the Storage Services Award.
[87] The seed department would not come within the coverage of the Horticulture
Award for the reasons outlined earlier in relation to the employer’s operations more
generally, that is, the environment in which this work is performed does not meet the
definition of ‘horticulture industry’.
[88] In relation to employees performing work on the Mitolo Group owned farms, the
evidence indicates that 12 employees performed work on farms in the past year and
that this work is secondary to their primary work at the Angle Vale Road site. In my
view this work is not of sufficient status in the overall operations of the employer to
bring the employer within the coverage of the Horticulture Award - the
characterisation of the employer’s business relates to its operations as a whole and not
to the work (or some of the work) of a small proportion of its employees.
[89] This conclusion also deals with Mr Duggan’s argument concerning the operation
of sub-clause 4.2(a) of the Storage Services Award ...
[90] I have determined that the Horticulture Award does not apply to the employees
who perform work on Mitolo Group owned farms and therefore sub-clause 4.2(a) has
no work to do. The construction advanced by Mr Duggan would result in the ‘dog
wagging the tail’8 where the performance of some work on farms by a small number
of employees would determine award coverage that is at odds with the substantial
character of the employer’s enterprise.
[91] Finally, there is the issue of whether produce is ‘stored’ at the Angle Vale Road
site. The storing of produce, goods or merchandise is one of the identified activities
within the definition of the “storage services and wholesale industry”, but it is not a
requirement that all the identified activities be performed by an employer to be
brought within the definition. The activities are disjunctive, albeit that they
collectively define the ‘storage services and wholesale industry’.
[92] As such, I do not consider that it is necessary to determine this issue, however
given the emphasis placed on it by the parties I make the following observations. In
my view the produce is stored, albeit for a short time of up to 3 days, in the sense that
it is placed somewhere pending dispatch. The more relevant issue is the weight that
attaches to this particular aspect of the operation in the context of the overall
characterisation of the Angle Road site. On this issue my conclusion would be limited
weight, having regard to the totality of the activities undertaken and the same day
turnaround of the clear majority of produce that is delivered to the site.
[93] I have concluded that the Storage Services Award is the relevant modern award
for the purposes of applying the BOOT. This conclusion is based primarily on the fact
8 Presumably the Deputy President meant to say “the tail wagging the dog”.
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that the employer’s operations do not fit within the definition of “horticulture
industry” which in turn defines the coverage of the Horticulture Award.
Notwithstanding that the Angle Vale Road operation has a commercial relationship
with, and is connected to the horticultural operations of the broader Mitolo Group, the
substantial character of the Angle Vale Road site falls within the definition of the
‘storage services and wholesale industry’.”
Submissions
[22] Mitolo submitted that the conclusion in the Decision that the Storage Services Award
and not the Horticulture Award was the relevant award was in error for five reasons:
(1) The business of the Mitolo Group was incorrectly characterised, and it was not
recognised that the substantial character of the business was one of a
horticulture business.
(2) The definitions and coverage provisions of the Horticulture Award were
incorrectly interpreted and applied.
(3) The definitions and coverage provisions of the Storage Services Award were
incorrectly interpreted and applied.
(4) Undue weight was placed on an Award Modernisation Statement of the
Commission which indicated that the coverage of one pre-reform award was
potentially relevant to the coverage of the Storage Services Award.
(5) There was a failure to take into account that the coverage of numerous pre-
modern awards and NAPSAs which applied to business such as the Mitolo
Group were incorporated into the coverage of the Horticulture Award during
the Award Modernisation process, most notably the Horticultural Industry
(AWU) Award 2000.
[23] In relation to the first contention of error, Mitolo submitted that although the Mitolo
Group consisted of a number of different legal entities, it operated a single integrated business
involving the seed development, planting, growing, harvesting, cleaning, treating, grading and
packing of potatoes and onions. The substantial character of that business was “agricultural
holdings ... in connection with the sowing, planting, raising, cultivation, harvesting, picking,
packing, storing, grading, forwarding or treating of horticultural crops, including ...
vegetables” and thus fell within the definition of “horticulture industry” in the Horticulture
Award. The integration of the Angle Vale Road site in that single business was demonstrated
by the fact that seed was grown, decanted and treated at that site, that it received crops grown
and harvested by the Mitolo Group elsewhere for cleaning, treating, grading and packing, that
many employees who worked at the site also worked on other properties in growing and
harvesting, that farm machinery used on other properties was maintained there, and that farm
waste was removed from the site to be used at other Mitolo Group properties. The Deputy
President erred in her characterisation of the business by looking only at the activities of the
specific employer, Mitolo, and not the Mitolo Group as a whole.
[24] In the alternative, it was submitted that even if it was necessary to characterise the
business of Mitolo alone, its substantial character was that of a business in the horticulture
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industry, since activities of the type referred to in the definition of “horticulture industry” in
the Horticulture Award were performed at the Angle Vale Road site. That site could
appropriately be characterised as a “farm” because it was zoned “Primary Production:
Precinct Description: Horticulture”; it was located in a rural area surrounded by farms and
horticultural businesses; seed development and the cleaning, treatment, grading and packing
of crops were conducted on site; the site’s functions were integrated with those of other farms
of the Mitolo Group and employees also worked on those farms; the site contained farm
machinery, farm chemicals, fertilizers, large dams and a water filtration system; and it
recycled waste to the other farms.
[25] As to the second contention of error, Mitolo submitted that the Deputy President erred
in determining at paragraphs [81] and [82] that the Horticulture Award did not extend beyond
the “farm gate”, which expression did not appear in that award. The use of the word
“including” in the definition of “horticulture industry” in subclause 4.2(a) meant that the
reference thereafter to a “farm” was not exhaustive, so that even if the Angle Vale Road site
was not a farm, this did not make a difference. Additionally, having regard to the integrated
nature of the business of the Mitolo Group, the Angle Vale Road site could be regarded as
being within the “farm gate” of that business.
[26] In relation to the third contention of error, Mitolo submitted that the Deputy President
erred by regarding clause 4.2(a) of the Storage Services Award as having no work to do.
Clause 4.2(a) limited the coverage of the Storage Services Award where another award
applied, and because the Horticulture Award applied to Mitolo, the effect of clause 4.2(a) was
to ensure that the Storage Services Award did not apply.
[27] In relation to the fourth and fifth contentions of error, Mitolo pointed to the fact that
the provisions of the Horticulture Award were largely based on the terms of the pre-reform
Horticultural Industry (AWU) Award 20009. That latter award clearly covered the work
performed by Mitolo at the Angle Vale Road site, since it applied to (among other things)
“processing, of fruits or vegetables” and the “storing, packing, or forwarding of fruits or
vegetables”. Unnecessary weight was placed on the fact that, at an early stage of the award
modernisation process, the South Australian Vegetable Processing (NUW) Award 200310 was
considered potentially relevant to the coverage of the Storage Services Award. That award
was ultimately incorporated into the Horticulture Award in the award modernisation process.
National Union of Workers11 was wrongly decided to the extent that it concluded otherwise.
[28] Mitolo submitted that permission to appeal should be granted in the public interest
because the Decision was attended by error and should not be permitted to stand, it conflicted
with principles established by Full Benches of the Commission and the High Court, it raised
important questions about the coverage of particular modern awards, and would have a
negative impact on a large number of businesses in the horticulture industry through
disturbing existing award coverage and imposing higher costs.
[29] Mitolo’s submissions were supported by the Australian Industry Group (AIG), the
National Farmers Federation (NFF), AusVeg SA, Potatoes South Australia, the Apple and
9 AP784867
10 AP823207
11 [2010] FWA 8228
[2015] FWCFB 2524
14
Pear Growers Association of SA Inc., HortEx Alliance Incorporated and Zerella Holdings Pty
Ltd, all of which appeared as interveners in the appeal.
[30] The National Union of Workers (NUW), which had appeared at first instance to
oppose the approval of the Agreement, made submissions in opposition to Mitolo’s appeal.
The NUW submitted that:
there was no error in the Deputy President’s conclusion concerning the relevant
award, and accordingly permission to appeal should be refused or, alternatively,
the appeal dismissed;
the task before the Deputy President was to identify the character, or the
substantial character, of Mitolo’s business and the work of the employees to be
covered by the proposed enterprise agreement, and on the basis of those
characterisations to determine which modern award applied;
the evidence made it clear that Mitolo’s main business was operating a vegetable
processing plant, and the other functions such as growing seeds and sending labour
to off-site farms was incidental to the main business of Mitolo, as the Deputy
President found;
because both of the modern awards under consideration fixed upon the industry of
“the employer”, it was necessary to characterise the business of Mitolo and not the
broader Mitolo Group;
subclause 4.2(a) of the Horticulture Award confined the definition of the
“horticultural industry” to farms, orchards and plantations, so that unless
vegetable processing occurred (relevantly) on a farm it was not covered by the
Horticulture Award;
the historical consideration in favour of this approach is that the words of clause
3.1 of the Storage Services Award were based on the NUW’s eligibility rule,
against a background whereby employees of Mitolo’s operations had been found
in 2000 to be eligible to join the NUW and the South Australian Vegetable
Processing (NUW) Award 2003, which bound Mitolo’s predecessor as a named
respondent, had been made on the basis of this finding;
the Horticultural Industry (AWU) Award 2000, unlike the current Horticulture
Award, was not confined to on-farm operations, and did not assist Mitolo’s case;
and
the restriction in the Horticulture Award’s coverage to on-farm operations was
deliberately added by the Australian Industrial Relations Commission when it
made the award as part of the award modernisation process.
[31] At the hearing of the appeal on 18 February 2015, we invited the parties to file further
submissions concerning the meaning and origin of the expression “agricultural holdings” in
clause 4.2(a) of the Horticulture Award. Mitolo and the AIG subsequently jointly submitted
that this expression had come into the coverage clause of the draft Horticulture Award during
the award modernisation process as a result of a proposal advanced by the Australian
[2015] FWCFB 2524
15
Workers’ Union, and was derived from the coverage clause of the Horticultural and Garden
Employees (State) Award, an award of the NSW Industrial Relations Commission. Mitolo and
the AIG further submitted that the expression meant “land owned ... for cultivation, including
crop-raising, etc; farming”. Their submission also pointed to the expression as having a legal
meaning (as exemplified in the Agricultural Holdings Act 1941 (NSW) and the subsequent
Agricultural Tenancies Act 1990 (NSW)), namely leasehold over a parcel or parcels of land
for agricultural production. Additional submissions to similar effect were made by the NFF
and Potatoes South Australia. The NUW submitted that that expression was a legal term of art
referring to a large farm leased to a tenant (or a sub-tenant or licensee) who performed
agricultural work upon it.
Consideration
[32] The better off overall test which, under s.186(2)(d) but subject to s.189, a non-
greenfields enterprise agreement must satisfy in order to be approved is set out in s.193(1).
Section 193(1) provides:
When a non-greenfields agreement passes the better off overall test
(1) An enterprise agreement that is not a greenfields agreement passes the better off
overall test under this section if the FWC is satisfied, as at the test time, that each
award covered employee, and each prospective award covered employee, for the
agreement would be better off overall if the agreement applied to the employee than if
the relevant modern award applied to the employee.
[33] What constitutes an “award covered employee” for the purpose of the better off
overall test is defined in s.193(4) as follows:
Award covered employee
(4) An award covered employee for an enterprise agreement is an employee who:
(a) is covered by the agreement; and
(b) at the test time, is covered by a modern award (the relevant modern award)
that:
(i) is in operation; and
(ii) covers the employee in relation to the work that he or she is to
perform under the agreement; and
(iii) covers his or her employer.
[34] “Test time” is defined in s.193(6) to mean the time the application for approval of the
agreement by the Commission was made.
[35] The task which the Deputy President had to undertake in applying the better off
overall test to the Agreement therefore required her to determine in the first instance whether,
at the time that Mitolo filed its application for approval of the Agreement, the employees
[2015] FWCFB 2524
16
covered by the Agreement were covered by a modern award that was, firstly, in operation,
secondly, covered the employee in relation to the work that he or she was to perform under
the agreement, and thirdly covered his or her employer. It is apparent that s.193(4) proceeds
on the assumption that no more than one modern award will cover any employee at the test
time. The modern award (if any) which so covers an employee will be the “relevant modern
award” for the purpose of the better off overall test in s.193(1).
[36] Section 48(1) relevantly provides that a modern award covers an employee or
employer if it is expressed to do so. Section 143(2) sets out the requirements for the
expression of coverage provisions in modern awards. There is a correspondence between the
reference to a modern award covering the employee in s.193(4)(b)(ii) and also covering the
employee’s employer in s.193(4)(b)(iii) and s.143(2), which provides as follows:
Employers and employees
(2) A modern award must be expressed to cover:
(a) specified employers; and
(b) specified employees of employers covered by the modern award.
[37] Thus the coverage provisions of modern awards will have a dual aspect: they will
describe coverage in terms of specified employers, and specified employees of those
employers. In order for any given employee to be covered by a modern award, that employee
must fall within the class of employees in respect of which the award is expressed to apply,
and additionally the employee’s employer must also fall within the class of employers in
respect of which the award is expressed to apply.
[38] The primary coverage provisions of the Horticulture Award (clause 4.1) and the
Storage Services Award (clause 4.1) are, consistent with s.143(2), expressed in terms of
coverage of specified employers and specified employees of those employers. In respect of
both awards, the employers covered are specified by reference to them being in an identified
industry, with that industry being given a definition in the award. The coverage of employees
is expressed in both awards by reference to them falling within the classifications in each
award.
[39] In relation to s.193(4)(b)(i), there is no issue that both the Horticulture Award and the
Storage Services Award were in operation at the time Mitolo filed its approval application.
Relevant to s.193(4)(b)(ii), the Deputy President made a finding that the employees covered
by the Agreement performed work which brought them within the classifications in the
Horticulture Award, and further found that the employees’ work brought them within
identified classifications in the Storage Services Award. Mitolo embraced the first finding,
and did not challenge the second finding. We consider that both findings were correct.
Therefore, for the purposes of s.193(4)(b)(ii), both awards covered the employees in relation
to the work that they were to perform under the Agreement.
[40] The contest at first instance and in the appeal turned on the s.193(4)(b)(iii)
requirement for coverage - that is, whether the Horticulture Award or the Storage Services
Award covered the employees’ employer, Mitolo. The determination of that question
necessarily involved consideration of whether Mitolo was in the “horticulture industry”, as
[2015] FWCFB 2524
17
defined in clause 4.2 of the Horticulture Award, or the “storage services and wholesale
industry” as defined in clause 3.1 of the Storage Services Award. We will first consider the
position under the Horticulture Award.
[41] Both parties advanced the position that the task of assessing whether the Horticulture
Award applied to Mitolo involved firstly characterising the substantial character of Mitolo’s
business, and then on the basis of that characterisation determining whether the award
applied. The principal difference in approach between Mitolo and the NUW concerned
whether the “substantial character” test was to be applied to Mitolo alone, or to the larger
business operated by the Mitolo Group. However because of the way industries are defined in
many modern awards, the application of a “substantial character” approach may be
inappropriate.
[42] This was discussed in the recent Federal Court Full Court appeal decision in Transport
Workers’ Union of Australia v Coles Supermarkets Australia Pty Ltd.12 In that case one of the
issues which arose for consideration was whether employees employed by a supermarket
chain who delivered groceries by truck fell within the definition of the “road transport and
distribution industry” in the Road Transport and Distribution Award 2010 (Transport
Award). The judge who heard the matter at first instance had applied the “substantial
character” approach to determine that the employees did not fall within the industry
definition. However the Full Court approached the issue in a different way as follows:
“[15] The primary judge decided that the Transport Award did not apply to the
employment. That finding was fatal to the case of the TWU. It is challenged on the
present appeal and represents the starting point in the analysis.
[16] Clause 4.1 of the Transport Award provides:
4.1 This industry award covers employers throughout Australia in the road
transport and distribution industry and their employees in the classifications
listed in clause 15 - Classifications and minimum wage rates to the exclusion
of any other modern award.
[17] The “road transport and distribution industry” is defined by cl 3 of the
Transport Award (relevantly here) as follows:
road transport and distribution industry means:
(a) the transport by road of goods, wares, merchandise, material or anything
whatsoever whether in its raw state or natural state, wholly or partly
manufactured state or of a solid or liquid or gaseous nature or otherwise, and/or
livestock, including where the work performed is ancillary to the principal
business, undertaking or industry of the employer;
...
(Emphasis added.)
12 [2014] FCAFC 148
[2015] FWCFB 2524
18
[18] The classification in Schedule C of the Transport Award which was said to be
apposite to the employment of CSAs was Transport Worker Grade 2, which
incorporated the classification of:
Driver of a rigid vehicle (including a motor cycle) not exceeding 4.5 tonnes
gross vehicle mass (GVM)
[19] The primary judge correctly acknowledged that:
155. ... The enterprise of an employer can have more than one character and be
in more than one industry. ...
[20] The primary judge recorded:
151. I accept on the evidence that the Coles Online business involves “the
transport by road of goods [etc]”. ...
and:
153. Coles acknowledges that the transport function might be ancillary to the
business of Coles for the purposes of the coverage clause of the Road
Transport Award ...
but went on to decide that Coles was not covered by the Transport Award because the
“substantial character” of its business was not transport but selling supermarket
products to retail customers.
[21] The “substantial character” test is one which was developed and expressed by
the High Court in relation to union eligibility rules (see R v Central Reference Board;
Ex parte Thiess (Repairs) Pty Ltd [1948] HCA 9; (1948) 77 CLR 123 at 135; Re
Federated Liquor and Allied Industries Employees’ Union of Australia; Ex parte
Australian Workers’ Union (1976) 51 ALJR 266 at 268-9; R v Moore; Ex parte
Federated Miscellaneous Workers’ Union of Australia [1978] HCA 51; (1978) 140
CLR 470 at 484-5). In our view, the “substantial character” test was not the
appropriate test for deciding whether the Transport Award applied.
[22] The test that should be applied is to discern the objective meaning of the words
used bearing in mind the context in which they appear and the purpose they are
intended to serve. Here, the definition in question expressly extended to work ancillary
to the principal business. That was the true question for examination.
[23] The employment in question fell comfortably within the road transport and
distribution industry as defined by cl 3 of the Transport Award, and therefore within
the coverage of the Transport Award stated in cl 4. The work in question was transport
of the requisite kind and was ancillary to the principal business of Coles.
[24] We are satisfied therefore that the TWU succeeds in its first challenge on the
appeal.”
http://www.austlii.edu.au/cgi-bin/LawCite?cit=%281978%29%20140%20CLR%20470?stem=0&synonyms=0&query=title(coles%20)&nocontext=1
http://www.austlii.edu.au/cgi-bin/LawCite?cit=%281978%29%20140%20CLR%20470?stem=0&synonyms=0&query=title(coles%20)&nocontext=1
http://www.austlii.edu.au/au/cases/cth/HCA/1978/51.html
http://www.austlii.edu.au/cgi-bin/LawCite?cit=%281948%29%2077%20CLR%20123?stem=0&synonyms=0&query=title(coles%20)&nocontext=1
http://www.austlii.edu.au/au/cases/cth/HCA/1948/9.html
[2015] FWCFB 2524
19
[43] We would derive from the Full Court’s decision the proposition that the “substantial
character” test will not be appropriate in determining coverage of a modern industry award at
least where the relevant industry is not defined in a way which operates by reference to a
characterisation of the employer’s business taken as a whole.
[44] We have earlier set out the definition of “horticulture industry” in clause 4.2 of the
Horticulture Award. Paragraph (b) of the definition is clearly not relevant to Mitolo, and no
party suggested otherwise. The definition is subject to certain exclusions in clause 4.3, but
again there was no issue that none of those exceptions was relevant. The question was
therefore whether Mitolo was, in respect of the area of employment covered by the
Agreement, in that part of the “horticulture industry” described in paragraph (a) of the
definition.
[45] We do not consider that paragraph (a) of the definition is readily amenable to the
“substantial character” test because it operates by reference to particular types of work
locations used for particular commercial activities. The primary part of the paragraph refers to
“agricultural holdings, flower or vegetable market gardens”, and thus emphasises at the
outset that the industry is to be defined by reference to where the commercial activity is
conducted. It then goes on to list certain types of commercial activity required to be
conducted at those locations. The subordinate part of the paragraph beginning with the word
“including” then describes additional types of locations - “farms, orchards and/or
plantations” - used in relation to fruit and vegetables. We accept Mitolo’s submission that
“including” is a word of extension, so to the extent that a relevant location cannot be
characterised as an agricultural holding or a flower or vegetable market garden, the location
will nonetheless fall within the industry definition if it is a farm, orchard or plantation.
[46] That work location was intended to be a critical element in the coverage of the
Horticulture Award is confirmed in the decision of the Full Bench of the AIRC in its Award
Modernisation decision of 3 April 200913 in which, among other things, it made the
Horticulture Award and other awards relating to agriculture and farming. In relation to
coverage, the Full Bench said: “Our overall approach to coverage of the pastoral and
horticultural awards is that they should be confined to agricultural production within the ‘farm
gate’.”14 It is clear therefore that it is not sufficient that commercial activities of the type
described in paragraph (a) of clause 4.2 are carried on by the employer; they must also be
carried out at the type of work locations specified in the paragraph.
[47] There was no issue that Mitolo carries out commercial activities of the types referred
to in paragraph (a) of clause 4.2, namely that at the Angle Vale Road site potatoes and onions
(which are “horticultural crops” as defined in clause 3.1 and are “vegetables”) are packed,
stored (albeit for short periods), graded and forwarded. Therefore the critical issue - as was
recognised by the Deputy President in the emphasised parts of the Decision which we have
earlier quoted - was whether, in respect of the employment relationships to which the
Agreement applied, the work locations were of a type referred to in clause 4.2(a). There was
no suggestion that, for relevant purposes, Mitolo operated a flower or vegetable market
garden or an orchard or plantation, so the question may be reduced to whether the Agreement
was to operate at an “agricultural holding” or a “farm”.
13 [2009] AIRCFB 345
14 Ibid at [53]
[2015] FWCFB 2524
20
[48] Consistent with the submissions of Mitolo, we consider that the ordinary meaning of
“agricultural holding” is a property or piece of land owned or used for farming or cultivation,
including crop-raising, forestry and stock-raising (based on the dictionary meanings of
“agriculture” and “holding”15). We also accept the submission of Mitolo and the NUW that
the expression also has an accepted meaning as a legal term of art, namely an agricultural
lease. Noting Mitolo’s submission that the expression “agricultural holding” seems to have
had its origin in awards of the NSW Industrial Relations Commission, we consider it unlikely
that award coverage would be drawn by reference to the legal basis upon which an employer
holds the land upon which it operates. There is no hint in the Award Modernisation decision
to which we have referred that the AIRC Full Bench intended, in restricting the coverage of
agricultural awards including the Horticulture Award to within the “farm gate”, for the
Horticulture Award to apply to leasehold farms only. We will apply the ordinary meaning.
[49] A “farm”, on its ordinary and most general meaning, is a tract of land devoted to
agriculture.16 It may also mean “a tract of land or water devoted to some other industry,
especially the raising of livestock, fish, etc.: a chicken farm; an oyster farm”17, but having
regard to the horticultural context we do not consider this definition to be relevant. We will
apply the general ordinary meaning, which does not appear to us to be any different to the
meaning of “agricultural holding”.
[50] The coverage clause of the Agreement is drawn in the first instance by reference to the
Angle Vale Road site, and the evidentiary finding of the Deputy President, which was not
challenged in the appeal, was that all but a small minority of employees worked only at the
Angle Vale Road site and that even those who worked elsewhere only did so on a secondary
basis. Mitolo’s notice of appeal did not challenge the findings of primary fact made by the
Deputy President concerning the nature and functions of the Angle Vale Road site. Those
findings, which we have earlier set out, make inescapable the conclusion that the Angle Vale
Road site is not an agricultural holding or a farm. Relevantly, it is not cultivated land and is
not used for the raising of crops or animals. It is best characterised as a mechanised vegetable
processing facility.
[51] The existence of the seed potato facility at the Angle Vale Road site, in which (on the
unchallenged finding of the Deputy President) 6 of the 188 employees to be covered by the
Agreement are employed, does not change the character of the site such as to permit it to be
characterised as an agricultural holding or farm. The seed potato function is performed in a
seed shed on the property, and the seed potatoes once processed are stored in a cool room
until required to be used for planting on separate farms owned by the Mitolo Group. In
Mitolo’s submissions, the functions performed in the seed shed in relation to the seed
potatoes, which are brought in from off-site, were described as follows:
“The seed potatoes are decanted (a process whereby the seed potato undergoes curing
and drying), graded and cut and then treated with chemicals, energiser and dusts which
assists with the growth of the seed potatoes.”
15 Using the Macquarie Online Dictionary definitions.
16 Macquarie Online Dictionary
17 Ibid
[2015] FWCFB 2524
21
[52] We accept that is an accurate summary of the evidence, and supports the conclusion
we have reached. It is best characterised as a processing and storage function. It is not a
function that requires the use of farm land.
[53] We therefore consider that the Deputy President was correct in finding that the
Horticulture Award did not cover Mitolo and its employees at the Angle Vale Road site.
[54] The coverage clause of the Agreement refers to the Agreement also applying at
“properties as assigned”. We assume this is a reference to the capacity of Mitolo under clause
13.2 of the Agreement to assign persons to perform harvesting functions at Mitolo Group
farms. In respect of this aspect of the work, Mitolo would clearly fall within paragraph (a) of
the definition of “horticulture industry” in clause 4.2(a). However it does not follow from that
conclusion that the Horticulture Award has any application. Clause 4.9 of the Horticulture
Award, which we have earlier set out, operates to prevent dual modern award coverage. As
will become apparent, we consider that the Deputy President was correct in concluding that
the Storage Services Award applied to Mitolo and its employees at the Angle Vale Road site.
Because, even for that minority of employees who perform any harvesting work at all, this on-
farm harvesting work is a minority of their total work, we consider that the Storage Services
Award’s classifications would be more appropriate to their work and the environment in
which they normally perform their work (that is, Angle Vale Road). Alternatively, even if we
were incorrect in this conclusion, as at the test time the large majority of employees were only
required to work at the Angle Vale Road site and therefore could never be covered by the
Horticulture Award for the reasons we have explained. That makes the conclusion reached by
the Deputy President concerning the better off overall test inescapable for the large majority
of employees.
[55] The Deputy President’s conclusion that the Storage Services Award applied we
consider to have been correct at least in respect of the Angle Vale Road site. In clause 4.1 of
that award, coverage of employers is expressed to operate by reference to them being in the
“storage services and wholesale industry”. The definition of that industry in clause 3.1 of the
Storage Services Award operates by reference to activities and products, and is not restricted
by location. The Deputy President’s primary findings of fact concerning the work activities
performed at the Angle Vale Road site compel the conclusion that they fall within the industry
definition, in that they substantially consist of the “receiving, handling, storing, ...
refrigerating, ... packing, preparation for sale, sorting, loading, dispatch ... of produce ... as
well as activities and processes connected, incidental or ancillary”. As earlier stated, Mitolo
did not challenge the Deputy President’s finding that employees at the Angle Vale Road site
fell within identified classifications in the Storage Services Award, and we agree with that
finding. Because, as we have earlier found, the Horticulture Award does not apply, the
Deputy President was also correct in finding that clause 4.2(a) of the Storage Services Award
has no work to do in the circumstances.
[56] The conclusions we have stated are sufficient to dispose of the appeal, but in deference
to the learned and comprehensive submissions made on behalf of Mitolo we consider we
should respond to some of the propositions raised in those submissions, as follows:
(1) It may be accepted, as submitted by Mitolo, that the evidence demonstrated
that the operation at the Angle Vale Road site constituted one part of a
vertically integrated business conducted by the Mitolo Group by which
horticultural products, namely potatoes and onions, are produced ready for
[2015] FWCFB 2524
22
sale. However it does not follow from that conclusion that the Horticulture
Award applied at the test time to the entirety of that business, given the
locational limitation in the coverage of that clause to which we have referred. It
is consistent with the intention of the Full Bench in the Award Modernisation
decision that the Horticulture Award not apply beyond the “farm gate” that, in
the case of the Mitolo Group, it would only apply to those persons directly
employed on the Mitolo Group’s farms in the cultivation and harvesting of
potatoes and onions and not to other parts of the operation. We note in this
connection Mitolo’s acceptance that the relevant modern road transport award
has coverage in respect of truck drivers it employs as part of that integrated
business.
(2) We do not consider that the character of the Angle Vale Road site as we have
described it is in any way altered because it is surrounded by farms, is located
in a rural-zoned area, and receives and sends product to Mitolo Group farms.
The same facility could readily be located in an urban area without any
difference as to its functional character (noting that the site is only a few
kilometres from the northern outskirts of Adelaide), in which case it could not
seriously be contended that it was a farm.
(3) That the pre-reform Horticultural Industry Award (AWU) Award 2000 would
have covered Mitolo at the Angle Vale Road site does not assist Mitolo,
because that award did not contain the locational limitation on coverage
deliberately placed in the modern Horticulture Award by the Full Bench in the
Award Modernisation decision to which we have earlier referred.
(4) The pre-reform South Australian Vegetable Processing (NUW) Award 2003, to
which Mitolo (then named Comit Farm Produce Pty Ltd) was a named
employer respondent, cannot be said to have been wholly incorporated into the
modern Horticultural Award, contrary to Mitolo’s submissions. That pre-
reform award applied to “all persons employed in South Australia in the
vegetable processing industry, including persons engaged in, or in connection
with ... the reception, handling, storing, preparation, packing, distribution,
delivery or forwarding of vegetables ...” without any limitation as to location.
That work, if it is performed on a farm, would now be covered by the
Horticulture Award. However if, as is the case with Mitolo, it is performed off-
farm, then it is covered by the Storage Services Award for the reasons we have
explained.
Conclusion
[57] Because Mitolo’s appeal has raised an issue concerning the coverage of the
Horticulture Award which is potentially of general application and involves a degree of
complexity, we consider that it is appropriate to grant permission to appeal. However, for the
reasons given, we consider that the Deputy President’s conclusion that the Storage Services
Award rather than the Horticulture Award covered the employees to which the Agreement
applied was correct, and therefore the appeal must be dismissed. We repeat that Mitolo’s
appeal did not challenge the Deputy President’s finding that she was not satisfied that the
Agreement satisfied the better off overall test by reference to the Storage Services Award,
[2015] FWCFB 2524
23
with the result that it has not been necessary or indeed available to us to give that issue any
consideration.
[58] Much of the evidence and submissions at first instance and some of the submissions
(particularly those of the interveners) in the appeal were concerned with the proposition that
the application of the Storage Services Award rather than the Horticulture Award to an
operation such as Mitolo’s at Angle Vale Road would result in increased employment costs
and a loss of business flexibility. In that context, we need to emphasise that, in applying the
better off overall test as required by the FW Act to the Agreement, considerations of this
nature did not arise for consideration. The question of which of the two awards applied to
Mitolo and its employees at the time Mitolo made its application is one which, as we have
explained, is resolved simply by the application of the coverage provisions of those awards,
interpreted according to their ordinary meaning, to the uncontested facts of this case.
[59] The 4 yearly review of modern awards required by s.156 of the FW Act is currently
proceeding. The Horticulture Award and the Storage Services Award fall within shortly
upcoming stages of the current review. If any party considers that the coverage or other
provisions of the two awards are such that the modern awards objective in s.134 of the FW
Act is not being met, the current review provides an opportunity for such an issue to be
agitated before a Full Bench of the Commission.
[60] We order as follows:
(1) Permission to appeal is granted.
(2) The appeal is dismissed.
VICE PRESIDENT
Appearances:
J. Fetter of counsel with E. Barrett for the National Union of Workers.
S. Smith, G. Vaccaro and P. Hentschke for Mitolo Group Pty Ltd.
Interveners
S. Smith, G. Vaccaro for the Australian Industry Group and Zerella Holdings Pty Ltd.
S. McKinnon for the National Farmers Federation.
B. Robertson for HortEx Alliance Inc.
R. Davis for Potatoes South Australia Inc.
P. White for Zerella Fresh.
J. Brooke-Barnett for Ausveg South Australia.
Hearing details:
THE SEA THE FAIR WORK SION
[2015] FWCFB 2524
24
2015.
Sydney:
February 18.
Printed by authority of the Commonwealth Government Printer
Price code C, PR563011
