1
Fair Work Act 2009
s.156 - 4 yearly review of modern awards
4 yearly review of modern awards – Fast Food Industry Award 2010
(AM2017/49)
Fast food industry
JUSTICE ROSS, PRESIDENT
DEPUTY PRESIDENT MASSON
COMMISSIONER LEE
MELBOURNE, 20 FEBRUARY 2019
Fast Food Industry Award 2010 – Award stage – substantive issues – Ai Group claims.
1. Introduction
[1] Section 156 of the Fair Work Act 2009 (the Act) requires the Commission to conduct a
4 yearly review of modern awards as soon as practicable after 1 January 2014 (the Review).
Subsection 156(2) deals with what must be done in the Review and provides that the
Commission must review all modern awards and may, among other things, make
determinations varying modern awards.
[2] This decision deals with two variations to the Fast Food Industry Award 2010 (the
Fast Food Award) sought by The Australian Industry Group (Ai Group) as part of the Review.
The two variations are the insertion of:
(i) a facilitative provision to allow employers and a majority of employees concerned
to agree to vary the end time of the evening penalty rate from 6.00am to 5.00am; and
(ii) a new part-time clause which permits ‘flexible part-time work’.
[3] The proposed variations are set out in the form of a draft variation determination at
Attachment 1 to this decision.
[4] The Shop, Distributive and Allied Employees Association (SDA) opposes the first
proposed variation1 but not the second.2 The Retail and Fast Food Workers Union
(RAFFWU) opposes both proposed variations.3
1 SDA submission 16 March 2018 at paras 4 – 20.
2 SDA submission 16 March 2018 at paras 21 – 66.
3 RAFFWU submission, 9 March 2018; RAFFWU submission, 26 July 2018.
[2019] FWCFB 272
DECISION
E AUSTRALIA FairWork Commission
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-raffwu-260718.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-raffwu-090318.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-sda-160318.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-sda-160318.pdf
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[5] The matter was heard over three days, 29 June 2018, 16 July 2018 and 19 July 2018;
and was followed by the filing of written submissions. The transcript of the proceedings and
the submissions are available on the 4 yearly review section of the Commission’s website. A
list of the written submissions filed is at Attachment 2 to this decision.
[6] Ai Group relied on affidavits from nine witnesses in support of its proposed variations,
only four4 of whom were required for cross-examination. The deponents of the affidavits are
set out in Attachment 3 to this decision.
[7] To assist the parties the Commission also published a ‘Fast food industry profile’
prepared by the Workplace and Economic Research section of the Commission. We return to
that publication later in our decision.
[8] It is necessary to first say something about the Commission’s task in the Review
before turning to describe the Fast Food industry and the two proposed variations.
2. The Review
[9] Section 156 deals with the conduct of the Review and s.156(2) provides that the
Commission must review all modern awards and may, among other things, make
determinations varying modern awards. In this context ‘review’ has its ordinary and natural
meaning of ‘survey, inspect, re-examine or look back upon’.5 The discretion in s.156(2)(b)(i)
to make determinations varying modern awards in a Review, is expressed in general,
unqualified, terms.
[10] If a power to decide is conferred by a statute and the context (including the subject-
matter to be decided) provides no positive indication of the considerations by reference to
which a decision is to be made, a general discretion confined only by the subject matter, scope
and purposes of the legislation will ordinarily be implied.6 However, a number of provisions
of the Act which are relevant to the Review operate to constrain the breadth of the discretion
in s.156(2)(b)(i). In particular, the Review function is in Part 2-3 of the Act and hence
involves the performance or exercise of the Commission’s ‘modern award powers’ (see
s.134(2)(a)). It follows that the ‘modern awards objective’ in s.134 applies to the Review.
[11] Section 138 (achieving the modern awards objective) and a range of other provisions
of the Act are also relevant to the Review: s.3 (object of the Act); s.55 (interaction with the
National Employment Standards (NES)); Part 2-2 (the NES); s.135 (special provisions
relating to modern award minimum wages); Division 3 (terms of modern awards) and
Division 6 (general provisions relating to modern award powers) of Part 2-3; s.284 (the
minimum wages objective); s.577 (performance of functions etc by the Commission); s.578
(matters the Commission must take into account in performing functions etc), and Division 3
of Part 5-1 (conduct of matters before the Commission).
[12] The modern awards objective is in s.134:
134 The modern awards objective
4 Mr Ian Flemington, Ms Annabel Sarah Anderson, Mr Nicola Agostino and Ms Elizabeth Montebello-Hunter.
5 Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161 at [38].
6 O’Sullivan v Farrer (1989) 168 CLR 210 at p. 216 per Mason CJ, Brennan, Dawson and Gaudron JJ.
https://www.fwc.gov.au/sites/awardsmodernfouryr/am201749-doc-profile-190718.pdf
https://www.fwc.gov.au/awards-and-agreements/modern-award-reviews/4-yearly-review/award-stage/award-review-documents/MA000003?m=AM2014/267
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What is the modern awards objective?
(1) The FWC must ensure that modern awards, together with the National
Employment Standards, provide a fair and relevant minimum safety net
of terms and conditions, taking into account:
(a) relative living standards and the needs of the low paid; and
(b) the need to encourage collective bargaining; and
(c) the need to promote social inclusion through increased
workforce participation; and
(d) the need to promote flexible modern work practices and the
efficient and productive performance of work; and
(da) the need to provide additional remuneration for:
(i) employees working overtime; or
(ii) employees working unsocial, irregular or unpredictable
hours; or
(iii) employees working on weekends or public holidays; or
(iv) employees working shifts; and
(e) the principle of equal remuneration for work of equal or
comparable value; and
(f) the likely impact of any exercise of modern award powers on
business, including on productivity, employment costs and the
regulatory burden; and
(g) the need to ensure a simple, easy to understand, stable and
sustainable modern award system for Australia that avoids
unnecessary overlap of modern awards; and
(h) the likely impact of any exercise of modern award powers on
employment growth, inflation and the sustainability,
performance and competitiveness of the national economy.
This is the modern awards objective.
When does the modern awards objective apply?
(2) The modern awards objective applies to the performance or exercise of
the FWC’s modern award powers, which are:
(a) the FWC’s functions or powers under this Part; and
(b) the FWC’s functions or powers under Part 2-6, so far as they
relate to modern award minimum wages.
Note: The FWC must also take into account the objects of this Act and any other applicable
provisions. For example, if the FWC is setting, varying or revoking modern award minimum
wages, the minimum wages objective also applies (see section 284).
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[13] The modern awards objective is to ‘ensure that modern awards, together with the
National Employment Standards, provide a fair and relevant minimum safety net of terms and
conditions’, taking into account the particular considerations identified in ss.134(1)(a)–(h)
(the s.134 considerations).
[14] The modern awards objective is very broadly expressed.7 It is a composite expression
which requires that modern awards, together with the NES, provide ‘a fair and relevant
minimum safety net of terms and conditions’, taking into account the matters in ss.134(1)(a)–
(h).8 Fairness in this context is to be assessed from the perspective of the employees and
employers covered by the modern award in question.9
[15] The obligation to take into account the s.134 considerations means that each of these
matters, insofar as they are relevant, must be treated as a matter of significance in the
decision-making process.10 No particular primacy is attached to any of the s.134
considerations11 and not all of the matters identified will necessarily be relevant in the context
of a particular proposal to vary a modern award.
[16] It is not necessary to make a finding that the award fails to satisfy one or more of the
s.134 considerations as a prerequisite to the variation of a modern award.12 Generally
speaking, the s.134 considerations do not set a particular standard against which a modern
award can be evaluated; many of them may be characterised as broad social objectives.13 In
giving effect to the modern awards objective the Commission is performing an evaluative
function taking into account the matters in s.134(1)(a)–(h) and assessing the qualities of the
safety net by reference to the statutory criteria of fairness and relevance.
[17] Further, the matters which may be taken into account are not confined to the s.134
considerations. As the Full Court observed in Shop, Distributive and Allied Employees
Association v The Australian Industry Group14 (Penalty Rates Review):
‘What must be recognised, however, is that the duty of ensuring that modern awards, together
with the National Employment Standards, provide a fair and relevant minimum safety net of
terms and conditions itself involves an evaluative exercise. While the considerations in
s 134(a)-(h) inform the evaluation of what might constitute a “fair and relevant minimum
safety net of terms and conditions”, they do not necessarily exhaust the matters which the
FWC might properly consider to be relevant to that standard, of a fair and relevant minimum
safety net of terms and conditions, in the particular circumstances of a review. The range of
such matters “must be determined by implication from the subject matter, scope and purpose
7 Shop, Distributive and Allied Employees Association v National Retail Association (No 2) (2012) 205 FCR 227 at [35].
8 (2017) 256 IR 1 at [128]; Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017]
FCAFC 161 at [41]–[44].
9 [2018] FWCFB 3500 at [21]-[24].
10 Edwards v Giudice (1999) 94 FCR 561 at [5]; Australian Competition and Consumer Commission v Leelee Pty Ltd [1999]
FCA 1121 at [81]-[84]; National Retail Association v Fair Work Commission (2014) 225 FCR 154 at [56].
11 Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161 at [33].
12 National Retail Association v Fair Work Commission (2014) 225 FCR 154 at [105]-[106].
13 See National Retail Association v Fair Work Commission (2014) 225 FCR 154 at [109]-[110]; albeit the Court was
considering a different statutory context, this observation is applicable to the Commission’s task in the Review.
14 Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161.
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of the” Fair Work Act (Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40;
(1986) 162 CLR 24 at 39-40).’15
[18] Section 138 of the Act emphasises the importance of the modern awards objective:
‘138 Achieving the modern awards objective
A modern award may include terms that it is permitted to include, and must include terms that
it is required to include, only to the extent necessary to achieve the modern awards objective
and (to the extent applicable) the minimum wages objective.’
[19] What is ‘necessary’ to achieve the modern awards objective in a particular case is a
value judgment, taking into account the s.134 considerations to the extent that they are
relevant having regard to the context, including the circumstances pertaining to the particular
modern award, the terms of any proposed variation and the submissions and evidence.16
[20] In 4 Yearly Review of Modern Awards - Penalty Rates (Hospitality and Retail Sectors)
decision (the Penalty Rates Case)17 the Full Bench summarised the general propositions
applying to the Commission’s task in the Review, as follows:
‘1. The Commission’s task in the Review is to determine whether a particular modern award
achieves the modern awards objective. If a modern award is not achieving the modern awards
objective then it is to be varied such that it only includes terms that are ‘necessary to achieve
the modern awards objective’ (s.138). In such circumstances regard may be had to the terms of
any proposed variation, but the focal point of the Commission’s consideration is upon the
terms of the modern award, as varied.
2. Variations to modern awards must be justified on their merits. The extent of the merit
argument required will depend on the circumstances. Some proposed changes are obvious as a
matter of industrial merit and in such circumstances it is unnecessary to advance probative
evidence in support of the proposed variation. Significant changes where merit is reasonably
contestable should be supported by an analysis of the relevant legislative provisions and,
where feasible, probative evidence.
3. In conducting the Review it is appropriate that the Commission take into account previous
decisions relevant to any contested issue. For example, the Commission will proceed on the
basis that prima facie the modern award being reviewed achieved the modern awards
objective at the time it was made. The particular context in which those decisions were made
will also need to be considered.
4. The particular context may be a cogent reason for not following a previous Full Bench
decision, for example:
the legislative context which pertained at that time may be materially different from
the Fair Work Act 2009 (Cth);
15 Ibid at [48].
16 See generally: Shop, Distributive and Allied Employees Association v National Retail Association (No.2) (2012) 205 FCR
227.
17 (2017) 256 IR 1.
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the extent to which the relevant issue was contested and, in particular, the extent of
the evidence and submissions put in the previous proceeding will bear on the weight
to be accorded to the previous decision; or
the extent of the previous Full Bench’s consideration of the contested issue. The
absence of detailed reasons in a previous decision may be a factor in considering the
weight to be accorded to the decision.’18
[21] Where an interested party applies for a variation to a modern award as part of the
Review, the proper approach to the assessment of that application was described by a Full
Court of the Federal Court in CFMEU v Anglo American Metallurgical Coal Pty Ltd (Anglo
American): as follows:19
‘[28] The terms of s 156(2)(a) require the Commission to review all modern awards every four
years. That is the task upon which the Commission was engaged. The statutory task is, in this
context, not limited to focusing upon any posited variation as necessary to achieve the modern
awards objective, as it is under s 157(1)(a). Rather, it is a review of the modern award as a
whole. The review is at large, to ensure that the modern awards objective is being met: that the
award, together with the National Employment Standards, provides a fair and relevant
minimum safety net of terms and conditions. This is to be achieved by s 138 – terms may and
must be included only to the extent necessary to achieve such an objective.
[29] Viewing the statutory task in this way reveals that it is not necessary for the Commission
to conclude that the award, or a term of it as it currently stands, does not meet the modern
award objective. Rather, it is necessary for the Commission to review the award and, by
reference to the matters in s 134(1) and any other consideration consistent with the purpose of
the objective, come to an evaluative judgment about the objective and what terms should be
included only to the extent necessary to achieve the objective of a fair and relevant minimum
safety net.’
[22] In the same decision the Full Court also said: ‘...the task was not to address a
jurisdictional fact about the need for change, but to review the award and evaluate whether the
posited terms with a variation met the objective.’20
[23] We will apply the above principles in this decision.
3. Fast Food Industry
3.1 Profile of a ‘typical’ Fast Food Industry employee
[24] The Fast Food industry can be broadly characterised as involving the production of
non-preservable items in that the food produced is for immediate consumption, rather than
stored for later use or sale.21 The Fast Food Award defines the ‘Fast Food industry’ as:
‘… the industry of taking orders for and/or preparation and/or sale and/or delivery of:
18 Ibid at [269].
19 CFMEU v Anglo American Metallurgical Coal Pty Ltd [2017] FCAFC 123.
20 Ibid at [46].
21 (2017) 256 IR 1 at [1265].
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Meals, snacks and/or beverages, which are sold to the public primarily to be
consumed away from the point of sale;
Take away foods and beverages packaged, sold or served in such a manner as to
allow their being taken from the point of sale to be consumed elsewhere should the
customer so decide; and/or
Food and/or beverages in food courts and/or in shopping centres and/or in retail
complexes, excluding coffee shops, cafes, bars and restaurants providing primarily a
sit down service inside the catering establishment.’22
[25] The ABS data of direct relevance to the Fast Food industry is quite limited.
[26] A paper23 by Commission staff provides a framework for ‘mapping’ modern award
coverage to the ANZSIC. Using this framework the Fast Food Award is ‘mapped’ to the
Takeaway food services industry class, which is at the ANZSIC 4 digit level.
[27] The ABS Labour Force survey is the usual source for data on employment. But data
on employed persons by industry is only available at the 3 digit or industry group level and
the relevant industry group is ‘Cafes, restaurants and takeaway food services’. In addition to
‘takeaway food services’ this industry group also includes persons employed in cafes and
restaurants (where consumption occurs on the premises) and catering services (where services
are provided at specified locations or events).
[28] The ABS Census of Population and Housing (Census) is the only data source with
information on employment at Takeaway food services level. The most recent Census data is
from August 2016.
[29] The August 2016 Census data shows that there were around 170, 000 employees in
Takeaway food services. About 23, 345 of these employees were employed on a full time
basis and the remaining 138, 438 worked part time (meaning they worked less than 35 hours
per week, as either a part time employee or a casual). Table 1 compares certain characteristics
of employees in the takeaway food services sector with employees in ‘all industries’, and
serves to highlight the distinctive features of employees in this sector.
Table 1: Employee characteristics of the Takeaway food services industry class, 9
August 201624
Takeaway food services All industries
(No.) (%) (No.) (%)
Gender
Male 76 461 44.9 4 438 604 50.0
22 Fast Food Industry Award 2010 Clause 3.1
23 Preston M, Pung A, Leung E, Casey C, Dunn A and Richter O (2012) ‘Analysing modern award coverage using the
Australian and New Zealand Industrial Classification 2006: Phase 1 report’, Research Report 2/2012 Fair Work Australia.
24 Source: ABS, Census of Population and Housing, 2016. Note: Part-time work in the Census is defined as employed
persons who worked less than 35 hours in all jobs during the week prior to Census night. Information on employment type is
collected for persons aged 15 years and over. Totals may not sum to the same amount due to non-response. For full-time/part-
time status and hours worked, data on employees that were currently away from work (that reported working zero hours),
were not presented.
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Takeaway food services All industries
(No.) (%) (No.) (%)
Female 93 762 55.1 4 443 125 50.0
Total 170 223 100.0 8 881 729 100.0
Full-time/part-time status
Full-time 23 345 14.4 5 543 862 65.8
Part-time 138 438 85.6 2 875 457 34.2
Total 161 783 100.0 8 419 319 100.0
Highest year of school completed
Year 12 or equivalent 82 206 48.8 5 985 652 68.1
Year 11 or equivalent 29 433 17.5 856 042 9.7
Year 10 or equivalent 34 907 20.7 1 533 302 17.4
Year 9 or equivalent 18 321 10.9 273 180 3.1
Year 8 or below 3381 2.0 112 429 1.3
Did not go to school 336 0.2 26 356 0.3
Total 168 584 100.0 8 786 961 100.0
Student status
Full-time student 100 952 59.6 715 436 8.1
Part-time student 7353 4.3 491 098 5.6
Not attending 61 091 36.1 7 618 177 86.3
Total 169 396 100.0 8 824 711 100.0
Age (5 year groups)
15–19 years 103 385 60.7 518 263 5.8
20–24 years 31 992 18.8 952 161 10.7
25–29 years 11 331 6.7 1 096 276 12.3
30–34 years 6104 3.6 1 096 878 12.3
35–39 years 3899 2.3 972 092 10.9
40–44 years 3592 2.1 968 068 10.9
45–49 years 3212 1.9 947 187 10.7
50–54 years 2785 1.6 872 485 9.8
55–59 years 2083 1.2 740 822 8.3
60–64 years 1265 0.7 469 867 5.3
65 years and over 545 0.3 247 628 2.8
Total 170 193 100.0 8 881 727 100.0
Average age 22.0 39.3
Hours worked
1–15 hours 92 643 57.3 977 997 11.6
16–24 hours 28 821 17.8 911 318 10.8
25–34 hours 16 977 10.5 986 138 11.7
35–39 hours 10 329 6.4 1 881 259 22.3
40 hours 7448 4.6 1 683 903 20.0
41–48 hours 2699 1.7 858 120 10.2
49 hours and over 2861 1.8 1 120 577 13.3
Total 161 778 100.0 8 419 312 100.0
[30] The profile of Fast Food employees differs from the profile of employees in ‘All
industries’ in four important respects:
(i) around 86 per cent of Fast Food employees work less than 35 hours per week,
compared to only 34.1 per cent of all employees;
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(ii) more than half (57.3 per cent) of Fast Food employees work 1–15 hours per week
and three-quarters (75.1 per cent) work 1–24 hours per week, compared to only 11.6
per cent and 22.4 per cent respectively of all employees;
(iii) over six in ten (60.7 per cent) Fast Food employees are aged between 15 and 19
years, and 79.5 per cent are aged between 15 and 24 years, compared with only 5.8 per
cent and 16.5 per cent respectively of all employees; and
(iv) almost two-thirds (63.9 per cent) of Fast Food employees are students (59.6 per
cent are full time students and 4.3 per cent study part time) compared to 13.7 per cent
of all employees.
[31] A comparison of the Census data from 2011 and 2016 shows that employment within
‘Takeaway food services’ has fallen by around 5, 000.25 Over this period, the Takeaway food
services industry class has experienced an increase in the proportion of employees working
less than 35 hours per week (from 79.7 per cent to 85.6 per cent) and full-time students (from
51.1 per cent to 59.6 per cent). The industry also experienced an increase in employees that
work 1–15 hours per week (from 49.6 per cent to 57.3 per cent) and employees aged between
15 and 24 years (from 71.1 per cent to 79.5 per cent).26
[32] Data on the duration of employment with a current employer from the Household,
Income and Labour Dynamics in Australia (HILDA) Survey are only available at the broader
ANZSIC 2-digit level. The relevant 2-digit industry subdivision that covers the Takeaway
food services industry class is the Food and beverage services sector.
[33] In addition to the Takeaway food services industry class, the Food and beverage
services industry subdivision also includes:
Cafes and Restaurants (4511) industry class;
Catering services (4513) industry class;
Pubs, taverns and bars (4520) industry class; and
Clubs (Hospitality) (4530) industry class.
[34] In 2016, employees in Food and beverage services were more likely to experience a
shorter duration of employment with an employer than employees across all industries. Chart
1 shows that almost 4 in 10 employees had been with their employer for less than a year while
almost a third of employees in Food and beverage services had been with their employer for 1
to less than 3 years.
25 ABS, Census of Population and Housing, 2011 and 2016.
26 Ibid.
10
Chart 1: Duration of employment with current employer for employees in Food and
beverage services, 201627
(ii) Award coverage
[35] The background to the making of the Fast Food Award was dealt with in the Penalty
Rates Case28 in which the Full Bench concluded (at [1182]) that the penalty rates in the Fast
Food Award were primarily set on the basis of the rates in the various pre-modernisation
instruments. The Full Bench also agreed (at [1181]) with the following submission advanced
by Ai Group in those proceedings:
‘(a) the focus in the award modernisation process was rationalising the number of awards that
operated in relation to the fast food industry;
(b) the principal concern of the employer parties was the inappropriateness of the National
Fast Food Award being used as the new safety net and, if was to be used, the increased costs
for employers in the fast food industry associated with the terms of that Award;
(c) although some material (in the form of statutory declarations) was relied upon by the
employer parties, that material was not tested in cross-examination…’ 29
[36] The evidence in the matter before us shows that in early February 2018:
27 Source: HILDA survey Wave 16, 2016.
28 (2017) 256 IR 1 at [1167]-[1183].
29 Submission on award modernisation proceedings, Ai Group, 10 June 2016 in AM2014/305–.
0
5
10
15
20
25
30
35
40
Less than 1 year 1 to less than 3
years
3 to less than 6
years
6 to less than 10
years
10 to less than
20 years
20 years or
more
Per cent
Food and beverage services All industries
https://www.fwc.gov.au/sites/awardsmodernfouryr/am2014305-sub-aig-100616.pdf
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there were 972 McDonald’s restaurants operating in Australia, employing 103, 136
persons.
there were 423 Hungry Jacks restaurants operating in Australia, of which 350 were
corporate restaurants and 73 were operated by franchisees. The corporate
restaurants employ 16, 134 persons.
Craveable Brands Limited operated 567 restaurants in Australia, of which 15 were
corporate restaurants and 522 were operated by franchisees. The total number of
persons employed in Craveable Brands restaurants was 11, 977. The restaurants
operate under three brands: Oporto, Red Rooster and Chicken Treat. The number of
corporate and franchisee restaurants operating under each brand is:
Oporto (1 corporate and 155 franchisee restaurants)
Red Rooster (9 corporate and 343 franchisee restaurants)
Chicken Treat (5 corporate and 52 franchisee restaurants).
[37] The total number of persons employed in McDonald’s restaurants; Hungry Jacks
corporate restaurants and Craveable Brands restaurants (collectively, the Major Fast Food
Chains) was 131, 247 in early February 2018. As mentioned above, the August 2016 Census
data shows that there were around 170, 000 employees in ‘Takeaway food services’. While
the two data sources are referable to different points in time it can be safely inferred that the
Major Fast Food Chains collectively employ a substantial majority (about three quarters) of
all Fast Food industry employees.
4. The Evidence
4.1 The Witnesses
[38] Ai Group filed 10 affidavits in support of the claims, from 9 witnesses.30 Of those
witnesses, four were required for cross-examination.
Ian Flemington
[39] Mr Flemington is the Chief People Officer of Craveable Brands and has held that role
since May 2015.31 Craveable Brands operates company-owned and franchisee restaurants
across Australia and New Zealand under the Oporto, Red Rooster and Chicken Treat brands.
Mr Flemington gave evidence that the one Oporto corporate restaurant, 84 franchised Oporto
restaurants, two Chicken Treat franchises and ‘a small number’ of Red Rooster franchises
30 Affidavit of Annabel Sarah Anderson dated 23 February 2018 (Exhibit Ai Group 3); Supplementary Affidavit of Annabel
Sarah Anderson dated 22 June 2018 (Exhibit Ai Group 4); Affidavit of Elizabeth Mary Montebello-Hunter dated 22 February
2018 (Exhibit Ai Group 7); Affidavit of Ian Flemington dated 23 February 2018 (Exhibit Ai Group 1); Affidavit of Nicola
Agostino dated 23 February 2018 (Exhibit Ai Group 6); Affidavit of Glenn Norman Sullivan dated 22 February 2018
(Exhibit Ai Group 9); Affidavit of John Francis Chapman dated 21 February 2018 (Exhibit Ai Group 10); Affidavit of
Alexander Martinoli dated 23 February 2018 (Exhibit Ai Group 11); Affidavit of Kate Nicole Swan dated 16 February 2018
(Exhibit Ai Group 12); Affidavit of Leasa Kate Francis Guilk dated 23 February 2018 (Exhibit Ai Group 13).
31 Affidavit of Ian Flemington dated 23 February 2018 (Exhibit Ai Group 1).
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operate under the Fast Food Award. As at 5 February 2018, Craveable Brands employed
11,594 employees in all its restaurants (928 full-time, 3,594 part-time and 7,072 casual
employees).
Annabel Sarah Anderson
[40] Ms Anderson is a Senior Employee Relations Advisor at McDonald’s Australia
Limited (McDonald’s) and has held that role since 14 August 2017.32 McDonald’s is
comprised of company owned restaurants and franchised restaurants. As at 2 February 2018
there were 972 McDonald’s restaurants in Australia (151 company owned and 821
franchised). As at 6 February 2018 McDonald’s employed a total of 103,058 employees
(6,849 full-time, 22,856 part-time and 73,021 casual employees). The McDonald’s
Enterprise Agreement 2013 (McDonald’s Agreement) applied to all employees employed in
the classifications of Crew Member, Crew Trainer or Maintenance, Delivery Driver, Shift
Supervisor, Shift or Trainee Manager or Manager.
Nicola Agostino
[41] Mr Nicola Agostino is the sole director of Agostino Group Holdings (AGH), a role he
has held since 2000.33 As at 1 February 2018, AGH operated three franchised McDonald’s
restaurants in Perth, Western Australia, all of which operate 24 hours a day, 7 days a week. As
at 1 February 2018, AGH employed a total of 362 employees across the three restaurants (28
full-time, 121 part-time and 213 casual employees) all of whom are covered by the
McDonald’s Australia Enterprise Agreement 2013.
Elizabeth Mary Montebello-Hunter
[42] Ms Montebello-Hunter is the National Field Human Resources Manager at Hungry
Jack’s and has held that role since May 2017.34 As at 1 February 2018 Hungry Jack’s operated
350 corporate restaurants and 73 restaurants were operated by franchisees. As at 1 February
2018 Hungry Jack’s corporate restaurants employed 16,134 employees (1,678 full-time,
14,067 part-time and 389 casual employees). The corporate restaurants operate under
Enterprise Agreements35 (six of which Ms Montebello-Hunter was aware of) and the
franchises operate either under Enterprise Agreements or the Fast Food Award.
Glenn Sullivan
[43] Mr Glenn Sullivan is a Food Operations Manager for Spargo Ten and Northern Food
Service (Spargo and Northern), which operate four Hungry Jack’s franchised restaurants in
Victoria and one in Queensland.36 Mr Sullivan gave evidence that as at 1 February 2018,
Spargo and Northern collectively employed 178 in all its restaurants (13 full-time, 0 part-time
and 165 casual employees). Approximately 50 to 60 per cent of those employees are school-
aged. All employees are employed under the Fast Food Award.
32 Affidavit of Annabel Sarah Anderson dated 23 February 2018 (Exhibit Ai Group 3); Supplementary Affidavit of Annabel
Sarah Anderson dated 22 June 2018 (Exhibit Ai Group 4).
33 Affidavit of Nicola Agostino dated 23 February 2018 (Exhibit Ai Group 6).
34 Affidavit of Elizabeth Mary Montebello-Hunter dated 22 February 2018 (Exhibit Ai Group 7).
35 Annexure EMH-1 to Affidavit of Elizabeth Mary Montebello-Hunter dated 22 February 2018 (Exhibit Ai Group 7).
36 Affidavit of Glenn Sullivan dated 22 February 2018 (Exhibit Ai Group 9).
13
John Chapman
[44] Mr John Chapman is the Chief Executive Officer of Airport Retail Enterprises (ARE),
which operates four Hungry Jack’s franchised restaurants.37 As at 1 February 2018, ARE
employed 123 employees across all its restaurants (11 full-time, 15 part-time and 97 casual
employees). All employees are employed under the Fast Food Award.
Alexander Martinoli
[45] Mr Alexander Martinoli is the Department Manager of a McDonald’s restaurant
located in Baulkham Hills, New South Wales and has held that position since 2016.38 Mr
Martinoli is employed on a part-time basis because he is studying full-time and works three
eight hour shifts each week. Preparing the rosters for crew members at the restaurant is Mr
Martinoli’s primary responsibility, but he also manages crew members and supervisors,
interviews prospective employees and schedules training for new employees. The restaurant
employs one full-time Restaurant Manager, 12 part-time crew members and 47 casual crew
members. All employees are employed pursuant to the McDonald’s Australia Enterprise
Agreement 2013.
Kate Swan
[46] Ms Kate Swan is a Certified Restaurant Trainer at Hungry Jack’s Pty Ltd and is
employed on a full-time basis.39 Ms Swan commenced employment with Hungry Jack’s in
2002 and has held various positions including Crew Member, Team Leader, Cadet Manager,
Assistant Manager and Restaurant Manager. In her current role, Ms Swan is responsible for
training managers in conducting recruitment interviews, cooking, roster preparation and
facilitating Restaurant Managers moving into restaurant ownership. Ms Swan is based at the
Cabramatta restaurant in Sydney but also works at other stores. Employees at the Cabramatta
restaurant are employed under the SDA Hungry Jack’s New South Wales / ACT Agreement
2004.
Leasa Guilk
[47] Ms Leasa Guilk is the Restaurant Manager of a Hungry Jack’s restaurant in
Blacktown, New South Wales and has held that position since November 2017.40 The
restaurant managed by Ms Guilk employs three full-time Assistant Managers and 61 part-time
crew members. The store does not employ any casual employees. All employees are
employed under the SDA Hungry Jack’s New South Wales / ACT Agreement 2004.
37 Affidavit of John Chapman dated 21 February 2018 (Exhibit Ai Group 10).
38 Affidavit of Alexander Martinoli dated 23 February 2018 (Exhibit Ai Group 11).
39 Affidavit of Kate Swan dated 16 February 2018 (Exhibit Ai Group 12).
40 Affidavit of Leasa Guilk dated 23 February 2018 (Exhibit Ai Group 13).
14
5. Ai Group Claim 1 – mechanism to change the end time of night shift
[48] Clause 25.5(a)(iii) of the Fast Food Award currently provides a 15 per cent loading for
ordinary hours of work performed between midnight and 6.00am, as follows:
‘25.5 Penalty rates
(a) Evening work Monday to Friday
…
(ii) A loading of 15% will apply for ordinary hours of work between midnight and
6.00 am, and for casual employees this loading will apply in addition to their 25%
casual loading.’
[49] As set out in the draft determination, Ai Group seeks to insert the following provision
at the end of clause 25.5(a)(ii):
‘The evening penalty rate end time (6.00 am) may be altered by up to one hour at the end of the
spread (up to 5.00 am), by agreement between an employer and the majority of employees
concerned.’
[50] As initially put, Ai Group’s claim was to vary the end time for the evening penalty
rate, from 6am to 5am, or, in the alternative, to insert a facilitative provision to allow an
employer to reach agreement with a majority of employees to vary the end time of the
evening penalty rate to 5am41 (the ‘facilitation claim’). At a conference before Commissioner
Lee on 1 December 2017 the SDA objected to us hearing Ai Group’s claim on the basis that
the matter had been fully heard and determined by the Penalty Rates Full Bench. The SDA
confirmed its objection in correspondence dated 13 December 2017 and asked that the
Commission strike out this aspect of Ai Group’s claim.
[51] On 8 February 2018 we issued directions inviting supplementary submissions
concerning the SDA’s objection. In response, Ai Group filed a submission on 9 February
2018 and the SDA filed a submission in reply on 20 February 2018. In a Statement issued on
1 March 201842 we rejected the SDA’s jurisdictional objection and indicated that we would
publish the reasons for that decision later.43 We rejected the SDA’s jurisdictional objection
because the facilitation claim before us is fundamentally different to the claim determined by
the Penalty Rates Case Full Bench.
[52] The issue of the end time of the evening penalty rate was determined by a Full Bench
of the Commission in the Penalty Rates Case.44 The Full Bench inserted an end time into
clause 25.5(a)(ii), and aligned that time with the end time for evening work in the Restaurant
Industry Award 2010 (which it reduced from 7am to 6am). The Full Benchdid so in answer to
2 claims in respect of the evening penalty rate:
41 Transcript, 1 December 2017 at [389].
42 [2018] FWCFB 1251.
43 [2018] FWCFB 2797.
44 (2017) 256 IR 1.
15
(i) a claim by Ai Group to adjust the commencing time of the evening penalty rate
in clause 25.5(a)(i) of the Award from 9pm to 10pm;45 and
(ii) a claim by RCI to vary clause 25.5(a) of the Award so that only a penalty rate
of 5% would be paid for work between midnight and 5am.46
[53] In dealing with RCI’s claim, the Full Bench noted that it was not submitted (at least
expressly) that the variation proposed would lead to an increase in the operating hours of fast
food businesses, or to an increase in employment. Nor did the Commission find there was
much (if any) direct, probative evidence to support such a contention.47
[54] In rejecting the claim by RCI, the Commission stated that a sufficient merit case had
not been advanced to support the extent of the changes proposed.48 At paragraph [1393] the
Commission held that:
‘As mentioned earlier, RCI is also seeking to vary the late night penalty in the Restaurant
Award in the same terms as its proposed variation to the Fast Food Award. We have dealt with
that proposal in Chapter 7.4.5(i) of our decision and have decided that the current 15 per cent
loading be payable between midnight and 6 am (not 7 am as it is in the current award term).
We adopt the same view in respect of the Fast Food Award. We note that the Fast Food
Award does not presently prescribe the span of hours during which the loading is paid. For the
reasons set out above ([1331]-[1335]) we propose to align the span of hours in the Fast Food
Award with that provided in the Restaurant Award.’
[55] As we have mentioned, the facilitation claim before us is fundamentally different to
the claim determined in the Penalty Rates Case and on that basis we reject the SDA’s
objection. We now turn to the submissions advanced in relation to the claim.
[56] Ai Group submits that the Fast Food Award should ‘facilitate the making of flexible
working arrangements for employees by efficient means, including for employees working
between 5.00am and 6.00am.’ It contended that the existing evening penalty clause does not
facilitate the making of flexible working arrangements for large groups of employees by
efficient means (given the number of employees making themselves available to work 5.00am
to 6.00am) as there is no effective mechanism to efficiently adjust by agreement the penalty
rate between 5.00am and 6.00am and on that basis it is argued that the current award
provision is failing to achieve the modern awards objective.
[57] Ai Group submits that it is likely that the proposed facilitative provision would be
utilised by participants in the fast food industry, given the terms of current enterprise
agreements (such as the McDonald’s Agreement) that have adjusted by agreement the penalty
rate such that it is not payable between 5.00am and 6.00am.
45 Ibid at [1161].
46 Ibid at [1164].
47 Ibid at [1344].
48 Ibid at [1392].
16
[58] Ai Group also submits that the need to consider contemporary circumstances is a
favourable consideration, given the prevalence of McDonald’s employees making themselves
available voluntarily to work 5.00am to 6.00am, without payment of a penalty for that period.
[59] The SDA and RAFFWU oppose the application contending, among other things, that
it ‘would be strikingly unfair to employees’ and that no cogent reason supported by probative
evidence has been advanced such as to demonstrate that it is necessary to amend the award in
the manner proposed.
[60] The evidence supports the following findings:
(i) some employers in the fast food industry (such as some employers operating
McDonald’s restaurants) open their restaurants between 5.00am and 6.00am as part of
normal trading hours;
(ii) some employers in the fast food industry (including some employers operating
McDonald’s restaurants) prepare their restaurants for opening between 5.00am and
6.00am; and
(iii) for one employer in the fast food industry (McDonald’s), there are as many as
10,962 employees each week day who make themselves available to work between
5.00am and 6.00am. Currently, that employer only requires an estimated 3,102
employees each week day to work between 5.00am and 6.00am.
[61] We also note Ms Anderson’s evidence that ‘the number of IFAs McDonald’s would
need to make for employees available to work Monday to Friday between 5am and 6am as at
10 April 2018 was 12,545’.49 We accept Ms Anderson’s evidence that if the Fast Food
Award was not varied and McDonald’s operated under the award, then requiring an IFA to
change the penalty rate end time from 5am to 6am, would involve:
‘significant administrative time and burden because it would require a written agreement signed
by the parties (which would necessarily require time in negotiating, preparing and executing
the agreement) in respect of over 10,000 individual employees. I estimate that it would take
10 minutes to negotiate, prepare and execute each agreement in respect of over 10,000
individual employees’50
[62] As we have mentioned, before varying a modern award the Commission must be
satisfied that if the modern award is varied in the manner proposed then it would only include
terms necessary to achieve the modern awards objective.
[63] The modern awards objective is to ‘ensure that modern awards, together with the NES,
provide a fair and relevant minimum safety net of terms and conditions’, taking into account
the particular considerations identified in paragraphs 134(1)(a)–(h) (the s.134 considerations).
The central issue is if the Fast Food Award was varied as proposed by Ai Group would it
provide a ‘fair and relevant minimum safety net’? Fairness in this context is to be assessed
from the perspective of the employees and employers covered by the modern award in
question. We now turn to the s.134 considerations.
49 Anderson Supplementary Affidavit, Exhibit Ai Group 5 at [8].
50 Anderson Affidavit, Exhibit Ai Group 3 at [58].
17
[64] Section 134(1)(a) requires that we take into account ‘relative living standards and the
needs of the low paid’. A threshold of two-thirds of median full-time wages provides a
suitable benchmark for identifying the ‘low paid’ for the purpose of s.134(1)(a).51 We are
satisfied that a substantial proportion of Fast Food industry employees are ‘low paid’.
[65] Ai Group submits that the proposed variation will not have an adverse impact on the
relative living standards and the needs of the low paid and that s.134(1)(a) is a neutral
consideration. Ai Group accepts that where an agreement is made between an employer and a
majority of employees pursuant to the proposed facilitative provision, a reduction in the
penalty rate between 5.00am and 6.00am will have an adverse impact on the relative living
standards and needs of the low paid; but submits that such a reduction will only occur through
the agreement of the majority of employees concerned (such that it is a consensual reduction)
and will only be for a small amount (the loss of 15 per cent loading for one hour only).
[66] The reasoning advanced by Ai Group is fallacious. First, contrary to the submission
put, it is not a ‘consensual reduction’. The change would be made with the agreement of a
simple majority of the employees concerned. Those opposed to such a change would have the
majority view imposed upon them. Second, Ai Group characterises the reduction as ‘for a
small amount’ (the loss of 15 per cent loading for one hour only). While the sum may appear
modest it must be seen from the perspective of the employees who would otherwise be
entitled to the loading. Such employees are overwhelmingly low paid. Any reduction in their
earnings is likely to have an adverse impact upon their capacity to meet their needs. In our
view s.134(1)(a) tells against the proposed variation.
[67] Section 134(1)(b) requires the Commission to take into account ‘the need to
encourage enterprise bargaining’. Ai Group contends that this is a neutral consideration and
relies on various passages from the Penalty Rates Case in support of its position. Ai Group
acknowledges that some of the major employers have addressed the issue by making and
having approved an enterprise agreement containing for the non-payment of the penalty rate
between 5.00am and 6.00am, but submits that:
‘there is no certainty that such enterprise agreements will continue in operation in the future or
will be replaced by enterprise agreements with the same or similar terms in the future.’52
[68] Currently, under the McDonald’s Agreement, the evening penalty is only paid
between 1.00am and 5.00am (see clause 28.3 of the McDonald’s Agreement) for crew and not
for managers (see clause 28.4 of the McDonald’s Agreement). The McDonald’s restaurants
do not experience difficulties in filling the shifts that cover 5.00am to 6.00am53 and currently
have more employees making themselves available for work between 5.00am and 6.00am
than positions to be filled.54 On this basis it is submitted that the McDonald’s restaurants do
not need to offer an incentive (such as a loading) to fill the period 5.00am to 6.00am.
51 See 4 yearly review of modern awards – Penalty Rates – Hospitality and Retail sectors [2017] FWCFB 1001 at [166]-
[168].
52 Ai Group submission 23 February 2018 at [39].
53 Anderson Affidavit Exhibit Ai Group 3 at [36], [42], [44]; see also Agostino Affidavit Exhibit Ai Group 6 at [21].
54 Anderson Affidavit Exhibit Ai Group 3 at [36], [42]; Agostino Affidavit, Exhibit Ai Group 6 at [21].
http://www.fwc.gov.au/decisionssigned/html/2017fwcfb1001.htm
18
[69] The Hungry Jacks Queensland Employee Collective Agreement 2009 provides that
there is no ‘early work penalty’ in South East Queensland (see clause 15.2(c)) and that outside
South East Queensland a 150 per cent penalty applies for ordinary time worked between
12:30am and 5:30am (see clause 15.3(c)). The SDA Hungry Jacks (South Australia and
Northern Territory) Certified Agreement 1999 makes no provision for an early work penalty
payment.
[70] We are not persuaded that varying the Fast Food Award in the manner proposed would
encourage enterprise bargaining. As conceded by Ai Group, some of the major employers in
the fast food industry have addressed this issue in their enterprise agreements. Varying the
award in the manner proposed would mean that it would be unnecessary to have an enterprise
agreement in order to address the issue raised; thus removing an incentive for fast food
employers to engage in enterprise bargaining. This consideration weighs against making the
variation proposed.
[71] Section 134(1)(c) requires that we take into account ‘the need to promote social
inclusion through increased workforce participation’. The use of the conjunctive ‘through’
makes it clear that in the context of s.134(1)(c), social inclusion is a concept to be promoted
exclusively ‘through increased workforce participation’. As the Expert Panel observed in the
2012-2013 Annual Wage Review decision55 obtaining employment is the focus of this
consideration.
[72] In its submission of 23 February 2018 Ai Group contends that s.134(1)(c) is concerned
with additional employment and that ‘in light of the absence of material addressing the issue a
neutral consideration’.56 In a later submission (dated 18 July 2018) Ai Group submits:
‘the variation in end time (and the removal of the penalty rate) may lead to an employee
receiving a greater number of hours worked over the week’57
[73] The Anderson Affidavit (Exhibit AiG 3 at [54](c)) is cited in support of this
submission. The relevant passage from Ms Anderson’s affidavit states:
‘During the time I was at the Bexley Mc Donald’s restaurant, I had conversations with the
employees who informed me that they preferred commencing work from 5am because:
…
(c) they desire to work more hours, and making themselves available to commence work at
5am provides them with more hours of work, and accordingly greater income.’
[74] In our view, Ms Anderson’s evidence does not support a finding that varying the Fast
Food Award to introduce the facilitative provision would lead to increased employment (in
terms of hours worked or number of persons employed). The consideration in s.134(1)(c)
does not provide any support for the variation sought.
[75] It is convenient to deal with ss.134(1)(d) and (f) together.
55 [2012] FWCFB 4000 at [100]-[102].
56 Ai Group submission, 23 February 2018 at [43].
57 Ai Group submission, 18 July 2018 at [15].
http://www.fwc.gov.au/decisionssigned/html/2013fwcfb4000.htm
19
[76] Section 134(1)(d) requires that we take into account ‘the need to promote flexible
modern work practices and the efficient and productive performance of work’ and s.134(1)(f)
requires that we take into account ‘the likely impact of any exercise of modern award powers
on business, including on productivity, employment costs and the regulatory burden’. We
note that s.134(1)(f) is expressed in very broad terms; it refers to the likely impact of any
exercise of modern award powers ‘on business, including’ (but not confined to) the specific
matters mentioned, that is, ‘productivity, employment costs and the regulatory burden’.
[77] Ai Group submits that, in terms of the insertion of the proposed facilitative provision
into the Fast Food Award itself, it will not have a direct impact on business (see section
134(1)(f)), although it provides the potential for the making of an agreement pursuant to the
proposed facilitative provision that could have a positive impact on business (through a
reduction in employment costs between 5.00am and 6.00am).
[78] We accept that if the claim was granted, and the award variation sought was made,
then an agreement made between an employer and a majority of employees pursuant to the
proposed facilitative provision would result in a reduction in the penalty rate between 5.00am
and 6.00am and a positive impact on the business as its employment costs will self-evidently
fall. On that basis it is to be regarded as a favourable consideration. However, there is no
evidence before us to suggest that the proposed variation will promote flexible work practices
or the efficient and productive performance of work.
[79] Section 134(1)(da) requires that we take into account the ‘need to provide additional
remuneration’ for:
‘(i) employees working overtime; or
(ii) employees working unsocial, irregular or unpredictable hours; or
(iii) employees working on weekends or public holidays; or
(iv) employees working shifts.’
[80] Ai Group submits that the need to provide additional remuneration for employees
working unsocial hours or working shifts is a neutral consideration as:
the insertion of the proposed facilitative provision into the Fast Food Award itself
will not affect the provision of additional remuneration for employees working
unsocial hours or working shifts; and
the reduction in the penalty rate between 5.00am and 6.00am, where an agreement
is made between an employer and a majority of employees concerned pursuant to
the proposed facilitative provision, is a reflection of the fact that the employer and
the majority of employees concerned do not regard the period of 5.00am to 6.00am
to be unsocial hours or shift work hours that need to attract an evening penalty and
is outweighed by other considerations affecting the employees concerned (such as
the earlier finishing of ordinary hours of work ).
20
[81] Section 134(1)(da) was given detailed consideration in the Penalty Rates Case.58 We
generally adopt those observations and only propose to highlight three matters.
[82] First, s.134(1)(da) speaks of the ‘need to provide additional remuneration’ for
employees performing work in the circumstances mentioned in s.134(1)(da)(i), (ii), (iii) and
(iv). The expression ‘additional remuneration’ in this context means remuneration in addition
to what employees would receive for working what are normally characterised as ‘ordinary
hours’, that is reasonably predictable hours worked Monday to Friday within the ‘spread of
hours’ prescribed in the relevant modern award. Such ‘additional remuneration’ could be
provided by means of a penalty rate or loading paid in respect of hours worked at particular
times (as is the case in clause 25.5 of the Fast Food Award).
[83] Second, the expression ‘the need for additional remuneration’ must be construed in
context, and the context tells against the proposition that s.134(1)(da) requires additional
remuneration be provided for working in the identified circumstances. Section s.134(1)(da) is
a relevant consideration, it is not a statutory directive that additional remuneration must be
paid to employees working in the circumstances mentioned in paragraphs 134(1)(da)(i), (ii),
(iii) or (iv); rather, s.134(1)(da) is a consideration which we are required to take into account.
[84] The requirement to take a matter into account does not mean that the matter is
necessarily a determinative consideration. This is particularly so in the context of s.134
because s.134(1)(da) is one of a number of considerations which we are required to take into
account. No particular primacy is attached to any of the s.134 considerations. The
Commission’s task is to take into account the various considerations and ensure that the
modern award provides a ‘fair and relevant minimum safety net’.
[85] Third, the use of the disjunctive ‘or’ in s.134(1)(da)(ii) makes it clear that the
provision is dealing with separate circumstances: ‘unsocial, irregular or unpredictable hours’
(emphasis added). Section 134(1)(da)(ii) requires that we take into account the need to
provide additional remuneration for employees working in each of these circumstances. The
expression ‘unsocial … hours’ would include working late at night and or early in the
morning, given the extent of employee disutility associated with working at these times.
‘Irregular or unpredictable hours’ is apt to describe casual employment.
[86] As we have mentioned, clause 25.2(a)(ii) of the Fast Food Award provides additional
remuneration for working between 5am and 6am (a 15% loading). This additional loading
reflects the disutility associated with working the unsocial hours between 5am and 6am. To
the extent that the variation sought would facilitate an arrangement in which no additional
remuneration was provided for the working of unsocial hours, s.134(1)(da) tells against
making the variation sought. The suggestion that such an arrangement would only be
introduced by consent is no answer as the ‘consent’ is provided by majority agreement. Once
a majority of employees have agreed to the removal of the penalty rate the entitlement is
removed for all employees.
[87] Section 134(1)(g) requires that we take into account ‘the need to ensure a simple, easy
to understand, stable and sustainable modern award system for Australia that avoids
unnecessary overlap of modern awards’.
58 [2017] FWCFB 1001 at [184]-[203].
21
[88] The SDA contends that s.134(1)(g) does not support the proposed variation. It submits
that the proposed facilitative provision would introduce uncertainty into the Fast Food Award
and points to the fact that the phrase ‘majority of employees concerned’ is ambiguous. We
agree that there is some uncertainty as to how the majority provision would operate in
practice; to that extent the proposed facilitative clause is not ‘easy to understand’ and
accordingly s.134(1)(g) is a consideration which weighs against making the variation
proposed.
[89] Section 134(1)(h) requires that we take into account ‘the likely impact of any exercise
of modern award powers on employment growth, inflation and the sustainability, performance
and competitiveness of the national economy’. The matters mentioned in s.134(1)(h) focus on
the aggregate (as opposed to sectorial) impact of an exercise of modern award powers. The
variation of the Fast Food Award in the manner proposed will not give rise to any significant
impact on the national economy.
[90] In addition to the s.134 considerations, three general observations may be made about
the fairness of the proposed facilitative provision,:
(i) there is no requirement to provide a corresponding benefit to compensate
employees for the loss of the penalty payment (as would be required if the
penalty payment was removed as part of an IFA or an enterprise agreement);
(ii) the decision to remove the penalty payment will be made by a majority of the
employees, in circumstances where most of those entitled to vote on the
proposition will not actually be working between 5am and 6am (for example,
McDonald’s only require 3102 employees each day to work between 5am and
6am, out of a total of 103,136 employees); and
(iii) the vote will apparently bind future employees, in perpetuity, in circumstances
where there is a significant turnover of employees. There does not appear to be
any mechanism to provide future employees with any say in the matter.
[91] As to the last observation above, it is apparent from Chart 1 that it is likely that there is
a higher turnover of employees in businesses covered by the Fast Food Award than in other
sectors. Almost 40 per cent of employees in the Food and beverage services sector have been
with their employer for less than a year (compared with about 22 per cent of employees in all
industries). The Takeaway food services sector is characterised by a high proportion of part-
time and young workers. About 85 per cent of ‘Fast Food’ employees work less than 35 hours
per week (compared to 34.2 per cent for all employees) and just over 60 per cent of ‘Fast
Food’ employees are young workers, aged 15 to 19 years (compared to only 5.8 per cent for
all industries).
[92] In our view the proposed variation lacks merit. If the award was varied in the manner
proposed by Ai Group it would not provide ‘a fair and relevant minimum safety net of terms
and conditions’; it would not achieve the modern awards objective. In reaching this
conclusion we have taken into account the s.134 considerations insofar as they are relevant to
the claim. We reject the claim for those reasons.
22
5. Ai Group Claim 2 – Flexible Part-time Clause
[93] Ai Group seeks to delete the part-time employment provisions in the Award (clause
12) and insert a new ‘flexible part-time clause’.59 A comparison between the current clause 12
and Ai Group’s proposed clause is set out at Attachment 5 to this decision. Clause 12 of the
current Award provides:
‘12. Part-time employees
12.1 A part-time employee is an employee who:
(a) works less than 38 hours per week; and
(b) has reasonably predictable hours of work.
12.2 At the time of first being employed, the employer and the part-time employee will agree,
in writing, on a regular pattern of work, specifying at least:
the number of hours worked each day;
which days of the week the employee will work;
the actual starting and finishing times of each day;
that any variation will be in writing;
that the minimum daily engagement is three hours; and
the times of taking and the duration of meal breaks.
12.3 Any agreement to vary the regular pattern of work will be made in writing before the
variation occurs.
12.4 The agreement and any variation to it will be retained by the employer and a copy given
by the employer to the employee.
12.5 An employer is required to roster a part-time employee for a minimum of three
consecutive hours on any shift.
12.6 An employee who does not meet the definition of a part-time employee and who is not a
full-time employee will be paid as a casual employee in accordance with clause 13—Casual
employment.
12.7 A part-time employee employed under the provisions of this clause will be paid for
ordinary hours worked at the rate of 1/38th of the weekly rate prescribed for the class of work
performed. All time worked in excess of the hours as agreed under clause 12.2 or varied under
clause 12.3 will be overtime and paid for at the rates prescribed in clause 26—Overtime.’
[94] As set out in the draft determination, the clause Ai Group seeks to replace the current
Award provisions with is as follows:
59 Ai Group submission, 23 February 2018 at [2](b).
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-aig-230218-amended.pdf
23
‘12. Part-Time Employment
12.1 A part time employee is an employee who:
(a) Works at least 8 but less than 38 hours per week;
(b) Has reasonably predictable hours of work; and
(c) Receives on a pro-rata basis, equivalent pay and conditions to those of full- time
employees.
12.2 At the time of engagement, the employer and the part-time employee will agree in
writing upon:
(a) the number of hours of work which are guaranteed to be provided and paid to the
employee each week or, where the employer operates a roster, the number of hours of
work which are guaranteed to be provided and paid to the employee over the roster
cycle (the guaranteed minimum hours); and
(b) the days of the week, and the periods in each of those days, when the employee
will be available to work the guaranteed minimum hours (the employee’s agreed
availability).
12.3 The employee may not be rostered to work less than 3 consecutive hours in any shift.
12.4 The guaranteed minimum hours shall not be less than 8 hours per week.
12.5 Any change to the guaranteed minimum hours may only occur with written consent of the
part-time employee.
12.6 Where there has been a genuine and ongoing change in the employee’s personal
circumstances, the employee may alter the days and hours of the employee’s agreed
availability on 14 days’ written notice to the employer. If the alteration to the employee’s
agreed availability cannot reasonably be accommodated by the employer within the
guaranteed minimum hours then, despite clause 12.2, those guaranteed minimum hours will no
longer apply and the employer and the employee will need to reach a new agreement in
writing concerning guaranteed minimum hours in accordance with clause 12.2.
12.7 An employee may be offered ordinary hours in addition to the guaranteed minimum
hours (additional hours) within the employee’s agreed availability. The employee may agree
to work those additional hours provided that:
(a) The additional hours are offered in accordance with clause 25 – Hours of Work
and clause 26 - Rostering;
(b) The employee may not be rostered for work outside of the employee’s availability;
(c) Agreed additional hours are paid at ordinary rates (including any applicable
penalties payable for working ordinary hours at the relevant times) and accrue
entitlements such as annual leave and personal/carer’s leave;
24
(d) The agreement to work additional hours may be withdrawn by a part-time
employee with 14 days written notice;
(e) Additional hours worked in accordance with this clause are not overtime; and
(f) Where there is a requirement to work overtime in accordance with clause 26,
overtime rates will apply.
12.8 A part-time employee who immediately prior to (operative date of variation) has a
written agreement with their employer for a regular pattern of hours is entitled to continue to
be rostered in accordance with that agreement, unless that agreement is replaced by a new
written agreement made in accordance with clause 12.2.
12.9 Where a part-time employee has over a period of at least 12 months regularly worked a
number of ordinary hours that is in excess of the guaranteed minimum hours, the employee
may request in writing that the employer agree to increase the guaranteed minimum hours. If
the employer agrees to the request, the new agreement concerning guaranteed minimum hours
will be recorded in writing. The employer may refuse the request only upon reasonable
business grounds, and such refusal must be provided to the employee in writing and specify
the grounds for refusal.
12.10 An employee who does not meet the definition of a part-time employee and who is not a
full-time employee will be paid as a casual employee in accordance with clause 13 – Casual
Employment.
12.11 A part-time employee employed under the provisions of this clause must be paid for
ordinary hours worked at the rate of 1/38th of the minimum weekly rate prescribed for the
class of work performed.’
[95] The claim also seeks to insert a new clause 26—Rosters, as follows:
‘26. Rosters
26.1 A roster for part-time employees must be prepared by the employer and made available to
the employee which sets out the name of each employee, the days of the week to be worked,
and their start and finishing times.
26.2 The roster will be alterable by mutual consent at any time or by amendment of the roster
on seven days’ notice.’
[96] It is also proposed that the existing clause 26.2 (dealing with when overtime shall be
paid) be deleted and replaced by:
‘27.2 A full-time employee shall be paid overtime for all work as follows:
(a) In excess of:
(i) 38 hours per week or an average of 38 hours per week averaged over a four
week period; or
(ii) five days per week (or six days in one week if in the following week
ordinary hours are worked on not more than four days); or
25
(iii) eleven hours on any one day; or
(b) Before an employee's rostered commencing time on any one day; or
(c) After an employee’s rostered ceasing time on any one day; or
(d) Outside the ordinary hours of work.
27.3 A part-time employee shall be paid overtime for all work as follows:
(a) In excess of:
(i) 38 hours per week; or
(ii) five days per week (or six days in one week if in the following week
ordinary hours are worked on not more than four days); or
(iii) eleven hours on any one day; or
(b) Hours worked by a part-time employee outside the employee’s availability; or
(c) Outside the ordinary hours of work.
27.4 A part time employee shall be paid overtime if directed to work:
(a) Before the employee's rostered commencing time on any one day; or
(b) After the employee’s rostered ceasing time on any one day.
27.5 Provided that no overtime penalty is payable for hours worked within the employee’s
availability by the part-time employee in excess of the guaranteed minimum hours that are:
(a) rostered; or
(b) not rostered in advance but agreed to be worked consistent with clause 12.7.’
[97] There are six main points of difference between the current award provisions and Ai
Group’s proposed clause:
(i) Ai Group’s proposed clause would introduce a minimum engagement of 8 hours
per week for part-time employees (‘guaranteed minimum hours’) and those guaranteed
minimum hours may only be varied by the employee’s written agreement.
(ii) The proposed clause does not require regular pattern of work (hours worked per
day, on which day/s of the week, starting and finishing times) to be agreed at the
commencement of employment, as is required by the current award. Instead, the
proposed clause requires parties to agree in writing on the days of the week, and times
on those days, that the employee is available to work the guaranteed minimum hours
(‘employee’s agreed availability’).
26
(iii) Ai Group’s proposed clause would remove the requirement for all time worked by
a part-time employee in excess of their agreed weekly hours (‘additional hours’) to be
paid at overtime rates. Instead, subject to the limitations in proposed clause 12.7, the
additional hours would be paid at ordinary rates;
(iv) Clause 12.3 of the current award requires any variation to an employee’s regular
pattern of work to be agreed in writing before the variation occurs. Ai Group’s
proposed clause alters this requirement in two ways:
An employee may change their agreed availability by giving 14 days’ written
notice to the employer, if there has been a ‘genuine and ongoing change’ to
the employee’s personal circumstances. If the employer cannot accommodate
the amended availability, the parties must come to a new guaranteed
minimum hours agreement.
Secondly, the proposed clause provides that additional hours may be worked
by agreement but makes no provision for the form of that agreement and any
record keeping;
(v) The proposed clause includes a ‘savings provision’ (in clause 12.8) which
preserves part-time agreements in operation prior to the insertion of the proposed
clause in the award.
(vi) The proposed clause inserts an additional provision that allows an employee,
where they have regularly worked hours in excess of their guaranteed minimum hours,
to make a written request that an employer increase the guaranteed minimum hours.
[98] The witness evidence before us is confined to the Major Fast Food Chains. As
mentioned earlier, employment in the Fast Food sector is dominated by the Major Fast Food
Chains (McDonald’s, Hungry Jacks corporate restaurants and Craveable Brands restaurants).
No evidence was adduced from an independent fast food business, outside of the Major Fast
Food Chains. The evidence relevant to this claim supports the following findings:
(i) The Major Fast Food Chains prepare crew rosters taking into account (among other
things) the availabilities of employees (the hours that they inform their employers that
they are available to work and which are ordinarily greater than the number of hours
they actually work) and expected customer demand.
(ii) Employees in the Major Fast Food Chains change their availabilities regularly,
including on a permanent or ongoing basis and a temporary basis.
(iii) Departures from rosters are common due to reasons such as “no shows”
(employees not attending for a rostered shift), illness and injury and unpredicted
customer demand.
(iv) Customer demand can fluctuate significantly for a variety of reasons, including
special events (such as sporting events) and the weather. Some of these fluctuations
are predictable and others are not.
27
(v) Many employers in the Major Fast Food Chains invite employees to work
additional hours to those included in rosters so as to cover for other employee
absences and unpredicted customer demand. The decisions on arranging alternative
staffing need to be made and implemented quickly.
(vi) Some employers in the Major Fast Food Chains do not employ (and do not roster
and do not use) part-time employees to meet changes in availabilities or predictable
increases in customer demand due to the need to pay overtime to part-time employees
working additional hours (that is, hours above their guaranteed minimum hours and
the need to record changes to guaranteed minimum hours in writing.
[99] Ai Group submits that the Fast Food Award should facilitate the making of flexible
working arrangements for employees, including in circumstances of other employee absences
and of unpredicted customer demand which necessitate the implementation of staffing
changes quickly and easily. It is submitted that the existing part-time clause in the Fast Food
Award does not facilitate the making of flexible working arrangements for part-time
employees as:
(i) it acts as a discouragement to the engagement of part-time employees and to the use
of part-time employees to work additional hours; and
(ii) it imposes an impractical administrative burden on employers (in the form of the
requirement to reduce to writing the agreement to work additional hours),
(iii) and is thereby failing to meet the modern awards objective.
[100] We note that in the Penalty Rates Case60 the Full Bench accepted that in 2015 the Fast
Food Industry consisted of 24, 654 enterprises across Australia and that there were about
1,000 – 1,300 McDonald’s and Hungry Jack’s establishments (comprising about 5 per cent of
the enterprises in the industry). It follows, as observed by RAFFWU,61 that given the confined
nature of the evidence in these proceedings there is no contemporaneous evidence before us
about the use of casual and part time employees in the vast majority of fast food enterprises.
[101] Ai Group contends that the current part-time provisions, in particular the requirement
for the employer and employee to agree in writing on the actual start and finish times of each
day of work, is ‘impractical’.62 Ai Group submits the proposed flexible part-time clause will
meet the contemporary circumstances of the fast food industry, including the unpredictable
fluctuations in customer demand and the need for speedy and easy decisions on, and
implementation of, staffing changes and thus will be “relevant” for the purposes of s.134 of
the Act.
[102] Ai Group also submitted that the proposed flexible part-time clause will enhance job
and income security as it is likely to lead to the engagement of more part-time employees
(who have the benefit of guaranteed minimum hours and thus guaranteed minimum pay) and
60 [2017] FWCFB 1001 at [1238].
61 RAFFWU Submission in Reply, 26 July 2018 at [6].
62 Ai Group submission, 9 July 2018 at [24].
28
the provision of more additional hours to part-time employees. In particular, Ai Group
contends that many employees would benefit from part-time employment including:
(i) a guaranteed minimum number of hours of work and thus guaranteed income,63
including a higher minimum number of hours than casuals.64
(ii) flexibility over the number of working hours worked, especially the ability to
increase or decrease hours to suit their circumstances (given school and university
commitments and family responsibilities).65
(iii) accessing leave entitlements,66 including to travel67 and to have time to study for
exams.68
[103] We would observe here that there is a paucity of evidence regarding the views of
actual employees about the proposed flexible part time clause.
[104] Ai Group also submits that the existing part-time clause in the Fast Food Award is
ineffective as it fails to contain the clause modelled on the flexible part-time work clause
recently inserted into the Hospitality Industry (General) Award 2010, the Restaurant Industry
Award 2010 and the Registered and Licensed Clubs Award 2010 (collectively, the Hospitality
Awards) consequent upon the Part-time and Casual Employment Decision69 and Part-time
and Casual Employment Further Matters Decision70 (together, the Casual/Part time
Decisions) and is thereby failing to meet the modern awards objective. Indeed the variation
sought by Ai Group in these proceedings has a number of features in common with the
variations in the Hospitality Awards arising from the Casual/Part-time Decisions.
[105] It is convenient to deal with the last argument first.
[106] In our view the observations of the Full Bench in the Casual/Part-time decisions and
the variations arising from that decision provide no warrant for varying the Fast Food Award
in the manner proposed. Three points may be made in this regard.
[107] First, it is clear from the terms of s.156(5) that in the context of the 4 yearly review
‘each modern award is reviewed in its own right’.
63 See Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [42], [44]; Sullivan Affidavit, Exhibit Ai Group 9 at [41];
Chapman Affidavit, Exhibit Ai Group 10 at [23]; Swan Affidavit, Exhibit Ai Group 12 at [16], [41]; Guilk Affidavit, Exhibit
Ai Group 13 at [15], [25].
64 See Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [44].
65 See Anderson Affidavit, Exhibit Ai Group 3 at [84]; Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [42], [46], [47];
Flemington Affidavit, Exhibit Ai Group 1 at [51]; Agostino Affidavit, Exhibit Ai Group 6 at [27], [48]; Martinoli Affidavit,
Exhibit Ai Group 11 at [6], [43], [44], [45], [49], [51]; Swan Affidavit, Exhibit Ai Group 12 at [18], [19], [20], [21]; Guilk
Affidavit, Exhibit Ai Group 13 at [15], [39].
66 See Anderson Affidavit, Exhibit Ai Group 3 at [85]; Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [42]; Flemington
Affidavit, Exhibit Ai Group 1 at [53]; Agostino Affidavit, Exhibit Ai Group at [49]; Sullivan Affidavit, Exhibit Ai Group 9
at [41]; Martinoli Affidavit, Exhibit Ai Group 11 at [46], [47]; Swan Affidavit, Exhibit Ai Group 12 at [16], [42], [45], [46];
Guilk Affidavit, Exhibit Ai Group 13 at [14], [26].
67 See Martinoli Affidavit, Exhibit Ai Group 11 at [53]; Swan Affidavit, Exhibit Ai Group 12 at [16], [45].
68 See Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [48]; Martinoli Affidavit, Exhibit Ai Group 11 at [46], [48], [53];
Swan Affidavit, Exhibit Ai Group 12 at [45]; see also Guilk Affidavit, Exhibit Ai Group 13 at [50].
69 [2017] FWCFB 3541.
70 [2017] FWCFB 6181.
29
[108] Second, in the Casual/Part-time Decisions the Full Bench made it clear71 that it did
not intend to depart from the general principle stated by the AIRC Full Bench in the Award
Modernisation Decision of 4 September 2009 that as a matter of concept and principle, part
time employment must carry with it a ‘degree of regularity and certainty of employment’ and
that it ‘should be akin to full time employment in all respects except that the average weekly
ordinary hours are fewer than 38’.72
[109] Third, the variations made by the Casual/Part-time Full Bench were based on the
evidence led in those proceedings and the findings made as to the nature and circumstances of
the industry sectors in questions.
[110] The last point is particularly pertinent. There are a number of characteristics of the
Fast Food sector which are quite different from the characteristics of the industry sectors
covered by the Hospitality Awards which were the subject of the proceedings before the
Casual/Part-time Full Bench, in particular:
60.7 per cent of Fast Food employees are aged between 15 and 19 years;
the major Fast Food chains collectively employ a substantial majority (about three
quarters) of all Fast Food industry employees;
the vast majority of employees employed by the major Fast Food chains are covered
by enterprise agreements:
- the McDonalds Enterprise Agreement 2013 applies to employees of
McDonalds and its franchisees who work in its Australian restaurants73
- all of Hungry Jacks’ corporate restaurants are on enterprise agreements (as at 1
February 2018 there were 423 Hungry Jacks’ restaurants in operation in
Australia of which 350 were corporate restaurants and 7 were operated by
franchisees)74
- virtually all employees of Red Rooster and its franchisees who work in its
Australian restaurants as crew are covered by an enterprise agreement75
- 22 Oporto franchisees are covered by enterprise agreements.76
[111] As to the last point it is fair to say that enterprise agreements are the most common
method of regulating employment in the Fast Food sector. We return to this observation later
in our consideration of s.134(1)(b).
[112] We also note that Ai Group’s application is supported by the SDA (but opposed by
RAFFWU). While the SDA’s position is relevant, it is far from decisive.
71 [2017] FWCFB 3541 at [525].
72 [2009] AIRCFB 826 at [144].
73 Affidavit of Annabel Anderson, Exhibit Ai Group 3 at [15].
74 Affidavit of Elizabeth Montebello-Hunter, Exhibit Ai Group 7 at [7], [8].
75 Affidavit of Ian Flemington, Exhibit Ai Group 1 at [15].
76 Ibid at [12] – [13].
30
[113] In times past, awards were made in settlement of industrial disputes and the
respondent parties to such awards were the parties to the relevant industrial dispute. The
nature of modern awards under the Act is quite different from awards under previous
legislative regimes77 and they perform a very different function to that performed by awards
of the past.
[114] Modern awards are not made to prevent or settle industrial disputes between particular
parties. Rather, the purpose of modern awards, together with the National Employment
Standards and national minimum wage orders, is to provide a safety net of fair, relevant and
enforceable minimum terms and conditions of employment for national system employees
(see ss.3(b) and 43(1)). Further, there are no named respondents to modern awards. Modern
awards apply to, or cover, certain persons, organisations and entities (see ss.47 and 48), but
these persons, organisations and entities are not ‘respondents’ to the modern award in the
sense that there were named respondents to awards in the past. The nature of this shift is made
clear by s.158 which sets out who may apply for the making of a determination making,
varying or revoking a modern award. Under previous legislative regimes the named
respondents to a particular award would automatically have the requisite standing to make
such applications; that is no longer the case.78 The shift in the nature and purpose of awards
means that the weight to be given to the views of interested parties is, generally speaking,
now less than it was previously.
[115] We now turn to the s.134 considerations.
[116] As we have mentioned, before varying a modern award the Commission must be
satisfied that if the modern award is varied in the manner proposed then it would only include
terms necessary to achieve the modern awards objective. The issue in contention is if the Fast
Food Award was varied as proposed by Ai Group would it provide a ‘fair and relevant
minimum safety net’? Fairness in this context is to be assessed from the perspective of the
employees and employers covered by the modern award in question. The matters mentioned
in s.134(1)(da), (e), (g) and (h) are neutral considerations in the present matter. No party
contended to the contrary.79 We now turn to the other s.134 considerations.
[117] Section 134(1)(a) requires that we take into account ‘relative living standards and the
needs of the low paid’. A substantial proportion of Fast Food industry employees are ‘low
paid’.
[118] Ai Group submits the proposed clause would not have an adverse impact on the needs
low paid part-time employees. It is also contended that the proposed clause may enhance job
and income security of casual employees, which, is submitted to weigh in favour of making
the proposed variation.
[119] RAFFWU submits the proposed clause would have ‘a serious and detrimental impact’
on the needs of low paid employees. It is contended that these employees are more likely to
be sensitive to the opportunity to work additional hours to supplement their income and make
77 National Retail Association v Fair Work Commission [2014] FCAFC 118 at [18].
78 The Australian Industry Group re Manufacturing and Associated Industries and Occupations Award 2012 [2012] FWA
2556.
79 See Ai Group submission, 23 February 2018 at [89]-[95]; RAFFWU submission in reply, 26 July 2018 at [89].
http://www.fwc.gov.au/decisionssigned/html/2012fwa2556.htm
http://www.fwc.gov.au/decisionssigned/html/2012fwa2556.htm
31
concessions to gain additional work. They are less likely to have the ability to secure flexible
arrangements (such as short notice childcare). It is submitted that if Ai Group’s claim was
granted, they would have increased uncertainty in their work hours and a reduction in
opportunities to work overtime.
[120] As we have mentioned, there is a paucity of evidence regarding the views of actual
employees about the proposed flexible part time clause. We accept that if the Fast Food
Award was varied in the manner proposed by Ai Group then part time employees may be
more likely to be required to work additional hours at ordinary rates (as opposed to overtime
rates under the current clause). We would also observe that there are aspects of the proposed
clause that are capable of visiting unfairness upon the employees who are subject to it, a point
to which we shall return shortly. Against these considerations are the potential benefits
identified by Ai Group, the most persuasive of which is the guaranteed minimum hours
provision. Given the range of countervailing issues and the paucity of evidence we have
concluded that this consideration is neutral to our assessment of the claim in the context of the
modern awards objective.
[121] Section 134(1)(b) requires that we take into account ‘the need to encourage enterprise
bargaining’. Ai Group and RAFFWU contend that this is a neutral consideration.80 We
disagree.
[122] Enterprise agreements are the most common method of regulating employment in the
Fast Food sector. Further, a number of the Major Fast Food Chains have included flexible part
time clauses in their enterprise agreements.
[123] The part-time clause in the McDonald’s Agreement requires that a roster include the
“days of the week” on which the part-time employee will work (see clause 14.4 of the
McDonald’s Agreement) and “actual starting and finishing time on each day” (see clause
14.4 of the McDonald’s Agreement) but allows the employer to “offer more hours of work”
which the part-time may “elect” to accept (see clause 14.4 of the McDonald’s Agreement) and
which, if accepted, is not required to be paid as overtime81 Under the McDonald’s Agreement,
the “actual starting and finishing times of each day”, if varied by the part-time employee
“electing” to accept the “offer” of the employer, need not be agreed “in writing”.82
[124] Under the Hungry Jack’s enterprise agreements, the part-time clause permits the
“number of ordinary hours” rostered to be worked by a part-time employee to be increased
“by mutual agreement” (see, for example, clause 10(m) of the Hungry Jack’s NSW/ACT
Agreement) and, subject to not exceeding limitations on daily or weekly hours, without
payment of overtime rates.83
80 See Ai Group submission, 23 February 2018 at [88]; RAFWWU submission in reply, 26 July 2018 at [89].
81 Clause 14.4 of the McDonald’s Agreement; see also clause 14.6 of the McDonald’s Agreement; Anderson Affidavit,
Exhibit Ai Group 3 at [76], [82]; Agostino Affidavit, Exhibit Ai Group 6 at [40]; Martinoli Affidavit, Exhibit Ai Group 11 at
[33], [36].
82 Anderson Affidavit, Exhibit Ai Group 3 at [77], [83]; Agostino Affidavit, Exhibit Ai Group 6 at [40]; Martinoli Affidavit,
Exhibit Ai Group 11 at [33], [36].
83 Swan Affidavit, Exhibit Ai Group 12 at [30], [37]; Guilk Affidavit, Exhibit Ai Group 13 at [43], [48].
32
[125] Under the Red Rooster Agreement 2009 (Red Rooster Agreement), the part-time
clause permits the “number of ordinary hours” rostered to be worked by a part-time employee
to be increased “by agreement” (see clause 9.6 of the Red Rooster Agreement) and, subject to
not exceeding limitations on daily, weekly or fortnightly hours, without payment of overtime
rates.84
[126] Under the Chicken Treat Employees, SDA Agreement 2009 (Chicken Treat
Agreement), the part-time clause permits the “number of ordinary hours” to be worked by a
part-time employee to be increased “by agreement” (see clause 11(2) of the Chicken Treat
Agreement) and, subject to not exceeding ten ordinary hours per day, without payment of
overtime rates.85 Under the Chicken Treat Agreement, the “agreement” need not be recorded
in writing.86
[127] Section 134(1)(c) requires that we take into account ‘the need to promote social
inclusion through increased workforce participation’. As mentioned earlier obtaining
employment is the focus of this consideration. Ai Group submitted that in the absence of
material addressing this issue it is a neutral consideration. We agree, there is simply no
evidence before us going to the impact of the proposed variation on obtaining employment.
[128] We are not persuaded that varying the Fast Food Award in the manner proposed by Ai
Group would encourage enterprise bargaining. Varying the award in the manner proposed
would render it unnecessary to have an enterprise agreement to address what are said to be the
inflexibilities in the current part time clause in the award; thus removing an incentive for fast
food employers to engage in enterprise bargaining. This consideration weighs against making
the variation proposed.
[129] Section 134(1)(d) requires that we take into account ‘the need to promote flexible
modern work practices and the efficient and productive performance of work’ and s.134(1)(f)
requires that we take into account ‘the likely impact of any exercise of modern award powers
on business, including on productivity, employment costs and the regulatory burden’.
[130] Ai Group submits that the proposed flexible part-time clause could have a favourable
impact on business (see section 134(1)(f)) by reducing overall employment costs (especially
where a part-time employee is used to work additional hours, in comparison to the costs of a
casual loading paid to casual employees) and on that basis it is submitted that this
consideration supports the insertion of the proposed flexible part-time clause into the Fast
Food Award.
[131] Section 134(f) requires us to consider the ‘likely impact of any exercise of modern
award powers on business, including on productivity, employment costs and the regulatory
burden’. Ai Group submits the proposed clause may reduce overall employment costs and
therefore have a positive impact on business, which weighs in favour of granting the claim. Ai
Group submits the reduction in employment costs would be particularly evident where a part-
time employee works additional hours under the proposed clause, in comparison to the
engagement of a casual employee to perform those hours.
84 Clause 9.6 of the Red Rooster Agreement; see also clauses 9.7 and 9.9 of the Red Rooster Agreement; see Flemington
Affidavit, Exhibit Ai Group 1 at [44], [49].
85 Clause 11 of the Chicken Treat Agreement; see also Flemington Affidavit, Exhibit Ai Group 1 at [44], [49].
86 Flemington Affidavit, Exhibit Ai Group 1 at [45], [50].
33
[132] The evidence also suggests that the Major Fast Food Chains would prefer to employ
part-time employees (rather than casual employees) because of a greater knowledge and
experience in restaurant operations,87 better service provided to customers,88 a better attitude89
and a more team-inclusive approach.90 Some employers would provide part-time employees
with additional hours to enable the training of other employees.91 Further, some employers
believe that they will have better employee retention levels and lower on-boarding costs if
they used part-time employees.92 These considerations also weigh in support of the proposed
clause.
[133] We accept that if the claim was granted, it would have a positive impact on business
and that this is a consideration which weighs in favour of varying the award in the manner
proposed.
[134] In addition to the s.134 considerations some general observations can be made about
the merit and fairness of the proposed flexible part time clause.
[135] Ai Group contends that its application is based on ‘industrial merit’ and includes:
‘the adoption of a standard clause that encompasses adequate protections for employees but
retains flexibility for employers, as well as the encouragement of part time employment in
circumstances where casuals are often used to work additional hours’93
[136] Given the basis of its application, that is, industrial merit, Ai Group submits that there
is no (or a limited) need for evidence in support of its application,94 in particular:
‘There is no need for employers or franchisors to consult widely with employees or franchisees
as part of gathering evidence in support of its application’.95
[137] We propose to make two general observations about the ‘industrial merit’ and fairness
of the proposed claim.
[138] First, if granted the claim would permit an employer to roster part time employees
within the range of the ‘employee’s agreed availability’. If the variation were granted it would
effectively mean that a part time employee would have to be available to work at any time
87 See Anderson Affidavit, Exhibit Ai Group 3 at [86]; Agostino Affidavit, Exhibit Ai Group 6 at [39]; Guilk Affidavit,
Exhibit Ai Group 13 at [27].
88 See Anderson Affidavit, Exhibit Ai Group 3 at [86]; Agostino Affidavit, Exhibit Ai Group 6 at [39]; Sullivan Affidavit,
Exhibit Ai Group 9 at [41]; Chapman Affidavit, Exhibit Ai Group 10 at [23]; Guilk Affidavit, Exhibit Ai Group 13 at [27].
89 See Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [43]; Sullivan Affidavit, Exhibit Ai Group 9 at [41]; Guilk
Affidavit, Exhibit Ai Group 13 at [28].
90 See Martinoli Affidavit, Exhibit Ai Group 11 at [52].
91 See Guilk Affidavit, Exhibit Ai Group 13 at [49].
92 See Anderson Affidavit, Exhibit Ai Group 3 at [87]; Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [43]; Flemington
Affidavit, Exhibit Ai Group 1 at [55]; Sullivan Affidavit, Exhibit Ai Group 9 at [41]; Guilk Affidavit, Exhibit Ai Group 13 at
[29]; see also Martinoli Affidavit, Exhibit Ai Group 11 at [50].
93 Ai Group Supplementary Outline of Submission in Reply, 18 July 2018 at [2](b).
94 Ibid.
95 Ibid at [2](d).
34
within the range of their stated availability and that the times they could be required to work
may change from week to week.
[139] An example serves to illustrate the breadth of the proposed clause. Say the agreed
guaranteed minimum hours are 9 hours per week and the employee’s agreed availability is
between 9am and 3pm Monday, Wednesday and Friday. Under the proposed clause an
employee may be rostered to work their guaranteed minimum hours in any one of a number of
figurations, including:
9am to 12 noon Monday, Wednesday and Friday;
9am to 3pm Monday and 12 noon to 3pm Friday;
12 noon to 3pm Monday, Wednesday and Friday.
[140] Further, the employees’ roster may change from week to week.
[141] This aspect of the proposed clause is very different to the existing part time
employment clause in the Fast Food Award (clause 12, see [93] above). The existing clause
mandates that the employer and the part time employee agree on ‘a regular pattern of work’
which specifies:
the number of hours worked each day;
which days of the week the employee will work;
the actual starting and finishing times of each day;
that any variation will be in writing;
that the minimum daily engagement is three hours; and
the times of taking and the duration of meal breaks.
[142] Any change to the agreed ‘regular pattern of work’ must be by agreement, in writing,
before the change occurs.
[143] The existing part time clause is consistent with the general principle stated by the
AIRC Full Bench in the Award Modernisation Decision of 4 September 2009, in that is
provides part time employees with a ‘degree of regularity and certainty’. It seems to us that
the proposed flexible part time clause provides little certainty as to when guaranteed
minimum hours will be worked. Indeed the proposed clause may facilitate working
arrangements which are more akin to casual employment rather than part time employment,
albeit without the requirement to pay a casual loading.
[144] It is no answer to this criticism to suggest that the employee exercises control over
their working arrangements by specifying their availability. We do not doubt that as a
practical matter, employees would feel some pressure to maximise their stated availability in
order to obtain employment. Further, the capacity for an employee to alter their ‘agreed
35
availability’ is significantly constrained by the proposed clause, which is the second general
observation which we wish to make.
[145] Proposed clause 12.6 places a significant constraint on an employee’s capacity to alter
the days and hours of their ‘agreed availability’, in particular:
there must have been a ‘genuine and ongoing change to the employee’s personal
circumstances’; and
the employee must give the employer 14 days’ written notice.
[146] Nor is there any obligation upon the employer to accept a proposed alteration – if it
cannot ‘reasonably be accommodated by the employer’ then the employer and employee need
to reach a new agreement concerning guaranteed minimum hours.
[147] The constraints imposed by proposed clause 12.6 are particularly problematic in view
of the evidence in these proceedings. That evidence supports a finding that employees in the
Major Fast Food Chains change their availabilities regularly, including on a permanent or
ongoing basis and a temporary basis.96 The reasons for permanent or ongoing changes include
changes in school or university timetabling and commitments97 as well as sporting
commitments.98 The reasons for temporary changes include studying for school or university
examinations,99 taking school and university holidays100 and attending family or social
commitments.101
[148] In our view the proposed variation lacks merit. If the award was varied in the manner
proposed by Ai Group it would not provide ‘a fair and relevant minimum safety net of terms
and conditions’; it would not achieve the modern awards objective. In reaching this
conclusion we have taken into account the s 134 considerations, insofar as they are relevant to
the claim. We reject the claim for those reasons.
[149] In doing so we are also conscious that s.138 provides that a modern award may only
include terms ‘to the extent necessary to achieve the modern awards objective. As noted by
the Full Federal Court in Anglo American:
96 Anderson Affidavit, Exhibit Ai Group 3 at [25](d), [25](e), [75]; Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [22];
Flemington Affidavit, Exhibit Ai Group 1 at [32]; Swan Affidavit, Exhibit Ai Group 12 at [50]; Guilk Affidavit, Exhibit Ai
Group 13 at [37], [38]; see also Agostino Affidavit, Exhibit Ai Group 6 at [27]; Martinoli Affidavit, Exhibit Ai Group 11 at
[21], [22].
97 Flemington Affidavit, Exhibit Ai Group 1 at [42]; Sullivan Affidavit, Exhibit Ai Group 9 at [26]; Chapman Affidavit,
Exhibit Ai Group 10 at [17]; Agostino Affidavit, Exhibit Ai Group 6 at [27]; Swan Affidavit, Exhibit Ai Group 12 at [19];
Guilk Affidavit, Exhibit Ai Group 13 at [37].
98 Agostino Affidavit, Exhibit Ai Group 6 at [32]; Sullivan Affidavit, Exhibit Ai Group 9 at [26].
99 Flemington Affidavit, Exhibit Ai Group 1 at [41].
100 Agostino Affidavit, Exhibit Ai Group 6 at [27]; Flemington Affidavit, Exhibit Ai Group 1 at [41]; Sullivan Affidavit,
Exhibit Ai Group 9 at [32].
101 Flemington Affidavit, Exhibit Ai Group 1 at [41]; Sullivan Affidavit, Exhibit Ai Group 9 at [32].
36
‘The words “only to the extent necessary” in s.138 emphasise the fact that it is the minimum
safety net and minimum wages objective to which the modern awards are directed. Other terms
and conditions beyond the minimum are to be the product of enterprise bargaining, and
enterprise agreements under Pt 2-4.’102
[150] As we have mentioned, the evidence in these proceedings shows the vast majority of
employees in the Major Fast Food Chains are covered by enterprise agreements. Further, a
number of those agreements include ‘flexible’ part time provisions. Such enterprise
agreements allow part time work provisions to be suitably framed such as to accommodate the
employer practices. The demonstrated capacity of the Major Fast Food Chains to enter into
enterprise agreements to address what are said to be inflexibilities in the current part time
clause is a consideration which also tells against the proposition that the proposed variation is
necessary to ensure that the Fast Food Award achieves the modern awards objective.
[151] But the rejection of Ai Group’s proposed clause is not the end of the matter. We see
merit in the provision of guaranteed minimum hours for part time employees and in the
simplification of the requirements attaching to the variation of a part time employee’s agreed
regular pattern of work. It is our provisional view that the current award places unwarranted
restrictions on the capacity to vary part time hours.
[152] As to the last matter, the evidence before us suggests that the requirement for the
employer and the employee to agree in writing to variations in actual hours before they occur
is impracticable and imposes an administrative burden upon employers.103
[153] The existing award provisions which warrant examination are 12.3 and 12.4,:
‘12.3 Any agreement to vary the regular pattern of work will be made in writing before the
variation occurs.
12.4 The agreement and any variation to it will be retained by the employer and a copy given
by the employer to the employee.’
[154] It is our provisional view that:
agreed variations need not be recorded before the variation occurs – it should be
sufficient to record the variation at the end of the relevant shift.
it is unnecessary to provide a copy of the agreed variation to the employee, it is
sufficient if a record is retained by the employer.
some clarification as to the meaning of ‘in writing’ may be appropriate.
[155] As to the last point we note that the Part time/Casuals Full Bench varied clause 25.5(c)
of the Social, Community, Home Care and Disability Services Industry Award 2010 in order
to clarify that:
102 CFMEU v Anglo American Metallurgical Coal Pty Ltd [2017] FCAFC 123 at [23]; cited with approval in Shop,
Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161 at [45].
103Anderson Affidavit, Exhibit Ai Group 3 at [93]; Montebello-Hunter Affidavit, Exhibit Ai Group 7 at [52]; Agostino
Affidavit, Exhibit Ai Group 6 at [46]; Chapman Affidavit, Exhibit Ai Group 10 at [22], [28], [29]; Martinoli Affidavit,
Exhibit Ai Group 11 at [24], [25]; Swan Affidavit, Exhibit Ai Group 12 at [48], [50]; Guilk Affidavit, Exhibit Ai Group 13 at
[53], [54].
37
‘“rostering arrangement and changes to rosters” may be communicated by any electronic means
of communication (for example, by text message) and that an equivalent provision to clause
25.5(c), as varied, be included in clause 22.6 of the Aged Care Award.’104
[156] Clause 22.6(f) of the Aged Care Award 2010 (as varied) states:
‘(f) Rostering arrangements and changes to rosters may be communicated by telephone, direct
contact, mail, email, facsimile or any electronic means of communication.’
[157] Whilst the above provision relates to roster changes it may also have some utility in
the context of variations to an employee’s agreed regular pattern of work.
[158] A conference will be convened by Deputy President Masson in relation to the two
issues mentioned in [151] shortly. The purpose of the conference is to provide interested
parties with an opportunity to comment on the provisional views expressed at [151] and [154]
above and to discuss the drafting of an appropriate variation to give effect to those provisional
views in the event they are ultimately confirmed by the Full Bench.
[159] The conference is not an opportunity to reagitate the matters determined in this
decision.
PRESIDENT
Appearances:
29 June 2018
Ms S Kelly, for the Retail and Fast Food Workers Union (RAFFWU)
Mr H Dixon, with Mr A Gotting for the Australian Industry Group (Ai Group)
16 July
Mr H Dixon SC, with Mr A Gotting for the Ai Group
Mr D Bruno, for the Shop Distributive and Allied Employees’ Association (SDA)
Mr J Cullinan, for RAFFWU
19 July
Ms S Kelly, for RAFFWU
Mr H Dixon, with Mr A Gotting for the Ai Group
Mr D Bruno, for the SDA
104 [2017] FWCFB 3541 at [645].
38
Hearing details:
29 June 2018 – Melbourne
16 July 2018 – Sydney
19 July 2018 – Sydney
Final written submissions:
Ai Group, 2 August 2018
SDA, 26 July 2018
RAFFWU, 26 July 2018
Printed by authority of the Commonwealth Government Printer
PR703917
39
ATTACHMENT 1: AI GROUP DRAFT VARIATION DETERMINATION
DRAFT DETERMINATION
Fair Work Act 2009
s.156 - 4 yearly review of modern awards
4 yearly review of modern awards – Fast Food Award 2010 (MA000003)
(AM2017/49)
JUSTICE ROSS, PRESIDENT SYDNEY, XX XXXX 2018
4 yearly review of modern awards – Fast Food Award 2010 (MA000003).
A. Further to the decision issued on [insert date]1 it is ordered that, pursuant to
s.156(2)(b)(i) of the Fair Work Act 2009, the Fast Food Industry Award 20102
be varied by:
1. Deleting existing clause 12.
2. Inserting new clause 12:
12. Part-Time Employment
12.1 A part time employee is an employee who:
(a) Works at least 8 but less than 38 hours per week;
(b) Has reasonably predictable hours of work; and
(c) Receives on a pro-rata basis, equivalent pay and conditions to those of
full- time employees.
AUSTRALIA FairWork Commission
40
12.2 At the time of engagement, the employer and the part-time employee will
agree in writing upon:
(a) the number of hours of work which are guaranteed to be provided and
paid to the employee each week or, where the employer operates a
roster, the number of hours of work which are guaranteed to be
provided and paid to the employee over the roster cycle (the
guaranteed minimum hours); and
(b) the days of the week, and the periods in each of those days, when the
employee will be available to work the guaranteed minimum hours
(the employee’s agreed availability).
12.3 The employee may not be rostered to work less than 3 consecutive hours in
any shift.
12.4 The guaranteed minimum hours shall not be less than 8 hours per week.
12.5 Any change to the guaranteed minimum hours may only occur with written
consent of the part-time employee.
12.6 Where there has been a genuine and ongoing change in the employee’s
personal circumstances, the employee may alter the days and hours of the
employee’s agreed availability on 14 days’ written notice to the employer. If
the alteration to the employee’s agreed availability cannot reasonably be
accommodated by the employer within the guaranteed minimum hours then,
despite clause 12.2, those guaranteed minimum hours will no longer apply
and the employer and the employee will need to reach a new agreement in
writing concerning guaranteed minimum hours in accordance with clause
12.2.
12.7 An employee may be offered ordinary hours in addition to the guaranteed
minimum hours (additional hours) within the employee’s agreed
availability. The employee may agree to work those additional hours
provided that:
(a) The additional hours are offered in accordance with clause 25 – Hours
of Work and clause 26 - Rostering;
(b) The employee may not be rostered for work outside of the employee’s
availability;
(c) Agreed additional hours are paid at ordinary rates (including any
applicable penalties payable for working ordinary hours at the relevant
times) and accrue entitlements such as annual leave and
personal/carer’s leave;
(d) The agreement to work additional hours may be withdrawn by a part-
time employee with 14 days written notice;
41
(e) Additional hours worked in accordance with this clause are not
overtime; and
(f) Where there is a requirement to work overtime in accordance with
clause 26, overtime rates will apply.
12.8 A part-time employee who immediately prior to (operative date of variation)
has a written agreement with their employer for a regular pattern of hours is
entitled to continue to be rostered in accordance with that agreement, unless
that agreement is replaced by a new written agreement made in accordance
with clause 12.2.
12.9 Where a part-time employee has over a period of at least 12 months
regularly worked a number of ordinary hours that is in excess of the
guaranteed minimum hours, the employee may request in writing that the
employer agree to increase the guaranteed minimum hours. If the employer
agrees to the request, the new agreement concerning guaranteed minimum
hours will be recorded in writing. The employer may refuse the request only
upon reasonable business grounds, and such refusal must be provided to the
employee in writing and specify the grounds for refusal.
12.10 An employee who does not meet the definition of a part-time employee and
who is not a full-time employee will be paid as a casual employee in
accordance with clause 13 – Casual Employment.
12.11 A part-time employee employed under the provisions of this clause must be
paid for ordinary hours worked at the rate of 1/38th of the minimum weekly
rate prescribed for the class of work performed.
3. In sub-clause 25.5(a)(ii), inserting after the words “25% causal loading.” of clause
25.5(a)(ii):
The evening penalty end time (6.00 am) may be altered by up to one hour at
the end of the spread (up to 5.00am), by agreement between an employer and
the majority of employees concerned.
4. Inserting a new clause after clause 25:
26. Rosters
26.1 A roster for full-time and part-time employees must be prepared by the
employer and made available to the employee which sets out the name of
each employee, the days of the week to be worked, and their start and
finishing times.
26.2 The roster will be alterable by mutual consent at any time or by amendment
of the roster on seven days’ notice.
5. Renumbering existing clauses 26 to 31 (inclusive), as clauses 27 to 32.
42
6. Deleting existing clause 26.2 (renumbered 27.2 in accordance with 5, above) and
inserting the following new clauses:
27.2 A full-time employee shall be paid overtime for all work as follows:
(a) In excess of:
(i) 38 hours per week or an average of 38 hours per week averaged
over a four week period; or
(ii) five days per week (or six days in one week if in the following
week ordinary hours are worked on not more than four days); or
(iii) eleven hours on any one day; or
(b) Before an employee's rostered commencing time on any one day; or
(c) After an employee’s rostered ceasing time on any one day; or
(d) Outside the ordinary hours of work.
27.3 A part-time employee shall be paid overtime for all work as follows:
(a) In excess of:
(i) 38 hours per week; or
(ii) five days per week (or six days in one week if in the following
week ordinary hours are worked on not more than four days); or
(iii) eleven hours on any one day; or
(b) Hours worked by a part-time employee outside the employee’s
availability; or
(c) Outside the ordinary hours of work.
27.4 A part time employee shall be paid overtime if directed to work:
(a) Before the employee's rostered commencing time on any one day; or
(b) After the employee’s rostered ceasing time on any one day.
27.5 Provided that no overtime penalty is payable for hours worked within the
employee’s availability by the part-time employee in excess of the guaranteed
minimum hours that are:
(a) rostered; or
43
(b) not rostered in advance but agreed to be worked consistent with clause
12.7.
7. Renumbering existing clauses 26.3 to 26.6 (inclusive) as clauses 27.6 to 27.9.
B. This determination comes into effect on [insert date].
PRESIDENT
Printed by authority of the Commonwealth Government Printer
PR703917
1 [insert citation].
2 MA000003.
44
ATTACHMENT 2: Submissions
Ai Group:
Outline of submission (23 February 2018, amended 12 July 2018);
Submission in reply (12 July 2018);
Findings sought (12 July 2018);
Response to questions (18 July 2018);
Submission in reply (18 July 2018); and
Submission in reply (2 August 2018).
Shop, Distributive and Allied Employees Association:
Submission (20 February 2018);
Submission (16 March 2018);
Submission in reply (18 July 2018); and
Submission in reply (26 July 2018).
Retail and Fast Food Workers Union:
Submission (undated; filed 9 March 2018);
Correspondence (undated; filed 18 July 2018); and
Submission in reply (undated; filed 26 July 2018).
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-raffwu-260718.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-raffwu-180718.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-raffwu-090318.pdf
https://www.fwc.gov.au/sites/awardsmodernfouryr/am201749-sub-sda-260718.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-sda-180718.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-sda-160318.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am2014267-49-sub-sda-200218.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-reply-aig-020818.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-aig-180718.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-corrinreply-aig-180718.pdf
https://www.fwc.gov.au/sites/awardsmodernfouryr/am201749-sub-aig-090718-amended.pdf
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/am201749-sub-reply-aig-260618-amended.pdf
https://www.fwc.gov.au/sites/awardsmodernfouryr/am201749-sub-aig-230218-amended.pdf
45
ATTACHMENT 3: Ai Group Affidavits
Mr Ian Flemington (Exhibit Ai Group 1) (Examination in Chief and Cross
Examination at Transcript 29 June 2018 at PN111–PN537);
Ms Annabel Anderson (Exhibit Ai Group 4; Supplementary Affidavit Exhibit Ai
Group 5) (Examination in Chief and Cross Examination at Transcript 16 July 2018
at PN612–PN1178);
Mr Nicola Agostino (Exhibit Ai Group 6) (Examination in Chief and Cross
Examination at Transcript 16 July 2018 at PN1183–PN1447);
Ms Elizabeth Montebello-Hunter (Exhibit Ai Group 7) (Examination in Chief and
Cross Examination at Transcript 16 July 2018 at PN1464–PN1703);
Mr Glenn Norman Sullivan (Exhibit Ai Group 9);
Mr John Francis Chapman (Exhibit Ai Group 10);
Mr Alexander Martinoli (Exhibit Ai Group 11);
Ms Kate Nicole Swan (Exhibit Ai Group 12); and
Ms Leasa Kate Frances Guilk (Exhibit Ai Group 13).
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/160718-am201749.htm
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/160718-am201749.htm
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/160718-am201749.htm
https://www.fwc.gov.au/documents/sites/awardsmodernfouryr/20180629_am201749.htm
46
ATTACHMENT 4: Fast Food Industry Profile
The following information presents an update on the profile of a ‘typical’ Fast Food industry
employee as published in the Penalty Rates Case Decision.105
A paper by Fair Work Commission staff provides a framework for ‘mapping’ modern award
coverage to the ANZSIC. Using this framework the Fast Food Award is ‘mapped’ to the
Takeaway food services industry class, which is at the ANZSIC 4 digit level.106.
The ABS Census of Population and Housing (Census) is the only data source with
information on employment at Takeaway food services level. The most recent Census data is
from August 2016.
The August 2016 Census data show that there were around 170 000 employees in Takeaway
food services. Table 1 compares characteristics available in the Census of employees in the
Takeaway food services industry class, with employees in ‘all industries’.
Table 1: Employee characteristics of the Takeaway food services industry class, 9 August 2016
Takeaway food services All industries
(No.) (%) (No.) (%)
Gender
Male 76 461 44.9 4 438 604 50.0
Female 93 762 55.1 4 443 125 50.0
Total 170 223 100.0 8 881 729 100.0
Full-time/part-time status
Full-time 23 345 14.4 5 543 862 65.8
Part-time 138 438 85.6 2 875 457 34.2
Total 161 783 100.0 8 419 319 100.0
Highest year of school completed
Year 12 or equivalent 82 206 48.8 5 985 652 68.1
Year 11 or equivalent 29 433 17.5 856 042 9.7
Year 10 or equivalent 34 907 20.7 1 533 302 17.4
Year 9 or equivalent 18 321 10.9 273 180 3.1
Year 8 or below 3381 2.0 112 429 1.3
Did not go to school 336 0.2 26 356 0.3
Total 168 584 100.0 8 786 961 100.0
Student status
Full-time student 100 952 59.6 715 436 8.1
Part-time student 7353 4.3 491 098 5.6
Not attending 61 091 36.1 7 618 177 86.3
Total 169 396 100.0 8 824 711 100.0
Age (5 year groups)
15–19 years 103 385 60.7 518 263 5.8
20–24 years 31 992 18.8 952 161 10.7
105 [2017] FWCFB 1001 at para 1272.
106 Preston M, Pung A, Leung E, Casey C, Dunn A and Richter O (2012), Analysing modern award coverage using the
Australian and New Zealand Standard Industrial Classification 2006: Phase 1 report, Research Report 2/2012, Fair
Work Australia, February; the ANZSIC class 4512–Takeaway food services is considered to be a ‘clean fit’ for the Fast
Food Industry Award 2010.
47
Takeaway food services All industries
(No.) (%) (No.) (%)
25–29 years 11 331 6.7 1 096 276 12.3
30–34 years 6104 3.6 1 096 878 12.3
35–39 years 3899 2.3 972 092 10.9
40–44 years 3592 2.1 968 068 10.9
45–49 years 3212 1.9 947 187 10.7
50–54 years 2785 1.6 872 485 9.8
55–59 years 2083 1.2 740 822 8.3
60–64 years 1265 0.7 469 867 5.3
65 years and over 545 0.3 247 628 2.8
Total 170 193 100.0 8 881 727 100.0
Average age 22.0 39.3
Hours worked
1–15 hours 92 643 57.3 977 997 11.6
16–24 hours 28 821 17.8 911 318 10.8
25–34 hours 16 977 10.5 986 138 11.7
35–39 hours 10 329 6.4 1 881 259 22.3
40 hours 7448 4.6 1 683 903 20.0
41–48 hours 2699 1.7 858 120 10.2
49 hours and over 2861 1.8 1 120 577 13.3
Total 161 778 100.0 8 419 312 100.0
Source: ABS, Census of Population and Housing, 2016
Note: Part-time work in the Census is defined as employed persons who worked less than 35 hours in all
jobs during the week prior to Census night. Information on employment type is collected for persons aged
15 years and over.
Totals may not sum to the same amount due to non-response. For full-time/part-time status and hours
worked, data on employees that were currently away from work (that reported working zero hours), were
not presented.
The profile of Fast Food employees differs from the profile of employees in ‘All industries’ in
four important respects:
around 86 per cent of Fast Food employees work part time (i.e. less than 35 hours per week), compared to
only 34.2 per cent of all employees;
more than half (57.3 per cent) of Fast Food employees work 1–15 hours per week and three-quarters (75.1
per cent) work 1–24 hours per week, compared to only 11.6 per cent and 22.4 per cent respectively of all
employees;
over six in ten (60.7 per cent) Fast Food employees are aged between 15 and 19 years, and 79.5 per cent are
aged between 15 and 24 years, compared with only 5.8 per cent and 16.6 per cent respectively of all
employees; and
almost two-thirds (63.9 per cent) of Fast Food employees are students (59.6 per cent are full time students
and 4.3 per cent study part time) compared to 13.7 per cent of all employees.
48
Changes in employee characteristics over time
Between 2011 and 2016, employment within the Takeaway food services industry class has
fallen by around 5000.107
Over this period, the Takeaway food services industry class has experienced an increase in the
proportion of part-time employment (from 79.7 per cent to 85.6 per cent) and full-time
students (from 51.1 per cent to 59.6 per cent). The Takeaway food services industry also
experienced an increase in employees that work 1–15 hours per week (from 49.6 per cent to
57.3 per cent) and employees aged between 15 and 24 years (from 71.1 per cent to 79.5 per
cent).108
107 ABS, Census of Population and Housing, 2011 and 2016.
108 ABS, Census of Population and Housing, 2011 and 2016.
49
ATTACHMENT 5: Comparison between current clause 12 and Ai Group’s proposed clause
Comparison of Fast Food Industry Award 2010 to part-time variations sought by The Australian Industry Group
Clause Fast Food Industry Award 2010 Variations sought by The Australian Industry Group
in Draft Determination
dated 24 April 2018
Definition of part time employee 12.1 A part-time employee is an employee who:
(a) works less than 38 hours per week; and
(b) has reasonably predictable hours of work.
12.1 A part time employee is an employee who:
(a) Works at least 8 but less than 38 hours per week;
(b) Has reasonably predictable hours of work; and
(c) Receives on a pro-rata basis, equivalent pay and conditions to
those of full- time employees.
Agreement on engagement 12.2 At the time of first being employed, the
employer and the part-time employee will agree,
in writing, on a regular pattern of work,
specifying at least:
the number of hours worked each day;
which days of the week the employee will
work;
the actual starting and finishing times of
each day;
that any variation will be in writing;
that the minimum daily engagement is three
hours; and
the times of taking and the duration of meal
breaks.
12.2 At the time of engagement, the employer and the part-time
employee will agree in writing upon:
(a) the number of hours of work which are guaranteed to be provided
and paid to the employee each week or, where the employer operates
a roster, the number of hours of work which are guaranteed to be
provided and paid to the employee over the roster cycle (the
guaranteed minimum hours); and
(b) the days of the week, and the periods in each of those days,
when the employee will be available to work the guaranteed
minimum hours (the employee’s agreed availability).
Minimum engagement 12.5 An employer is required to roster a part-time
employee for a minimum of three consecutive
hours on any shift.
12.3 The employee may not be rostered to work less than 3
consecutive hours in any shift.
50
Clause Fast Food Industry Award 2010 Variations sought by The Australian Industry Group
in Draft Determination
dated 24 April 2018
Guaranteed minimum hours No equivalent clause 12.4 The guaranteed minimum hours shall not be less than 8 hours per
week.
Variation to work 12.3 Any agreement to vary the regular pattern of
work will be made in writing before the
variation occurs.
12.4 Any change to the guaranteed minimum hours may only occur with
written consent of the part-time employee.
Variation to work 12.4 The agreement and any variation to it will be
retained by the employer and a copy given by
the employer to the employee.
No equivalent clause
Change to guaranteed minimum
hours
No equivalent clause 12.6 Where there has been a genuine and ongoing change in the
employee’s personal circumstances, the employee may alter the
days and hours of the employee’s agreed availability on 14 written
notice to the employer. If the alteration to the employee’s agreed
availability cannot reasonably be accommodated by the
employer within the guaranteed minimum hours then, despite
clause 12.2, those guaranteed minimum hours will no longer apply
and the employer and the employee will need to reach a new
agreement in writing concerning guaranteed minimum hours in
accordance with clause 12.2.
Additional hours No equivalent clause 12.7 An employee may be offered ordinary hours in addition to the
guaranteed minimum hours (additional hours) within the
employee’s agreed availability. The employee may agree to work
those additional hours provided that:
The additional hours are offered in accordance with clause 25 –
Hours of Work and clause 26 - Rostering;
The employee may not be rostered for work outside of the
employee’s availability;
Agreed additional hours are paid at ordinary rates (including any
applicable penalties payable for working ordinary hours at the
51
Clause Fast Food Industry Award 2010 Variations sought by The Australian Industry Group
in Draft Determination
dated 24 April 2018
relevant times) and accrue entitlements such as annual leave and
personal/carer’s leave;
The agreement to work additional hours may be withdrawn by a
part-time employee with 14 days written notice;
Additional hours worked in accordance with this clause are not
overtime; and
Where there is a requirement to work overtime in accordance with
clause 26, overtime rates will apply.
Continuation of regular pattern of
hours
No equivalent clause 12.8 A part-time employee who immediately prior to (operative date of
variation) has a written agreement with their employer for a regular
pattern of hours is entitled to continue to be rostered in accordance
with that agreement, unless that agreement is replaced by a new
written agreement made in accordance with clause 12.2.
Increase to guaranteed minimum
hours
No equivalent clause 12.9 Where a part-time employee has over a period of at least 12 months
regularly worked a number of ordinary hours that is in excess of the
guaranteed minimum hours, the employee may request in writing
that the employer agree to increase the guaranteed minimum hours.
If the employer agrees to the request, the new agreement
concerning guaranteed minimum hours will be recorded in writing.
The employer may refuse the request only upon reasonable
business grounds, and such refusal must be provided to the
employee in writing and specify the grounds for refusal.
52
Clause Fast Food Industry Award 2010 Variations sought by The Australian Industry Group
in Draft Determination
dated 24 April 2018
Casual Employees 12.6 An employee who does not meet the definition
of a part-time employee and who is not a full-
time employee will be paid as a casual
employee in accordance with clause 13 —
Casual employment.
12.10 An employee who does not meet the definition of a part-time
employee and who is not a full-time employee will be paid as a
casual employee in accordance with clause 13 – Casual
Employment.
Pro-rata rate and overtime 12.7 A part-time employee employed under the
provisions of this clause will be paid for
ordinary hours worked at the rate of 1/38th of
the weekly rate prescribed for the class of work
performed. All time worked in excess of the
hours as agreed under clause 12.2 or varied
under clause 12.3 will be overtime and paid for
at the rates prescribed in clause 26 - Overtime.
12.11 A part-time employee employed under the provisions of this clause
must be paid for ordinary hours worked at the rate of 1/38th of the
minimum weekly rate prescribed for the class of work performed.
Rosters No equivalent clause 26.1 A roster for full-time and part-time employees must be prepared by
the employer and made available to the employee which sets out the
name of each employee, the days of the week to be worked, and their
start and finishing times.
Rosters No equivalent clause 26.2 The roster will be alterable by mutual consent at any time or by
amendment of the roster on seven days’ notice.
53
Clause Fast Food Industry Award 2010 Variations sought by The Australian Industry Group
in Draft Determination
dated 24 April 2018
Overtime 26.2 A full-time or part-time employee shall be paid
overtime for all work as follows:
(a) In excess of:
(i) 38 hours per week or an average of 38
hours per week averaged over a four
week period; or
(ii) five days per week (or six days in one
week if in the following week ordinary
hours are worked on not more than four
days); or
(iii) eleven hours on any one day; or
27.2 A full-time employee shall be paid overtime for all work as follows:
(a) In excess of:
38 hours per week or an average of 38 hours per week averaged over
a four week period; or
five days per week (or six days in one week if in the following week
ordinary hours are worked on not more than four days); or
eleven hours on any one day; or
Overtime (b) Before an employee's rostered commencing
time on any one day; or
(b) Before an employee's rostered commencing time on any one day; or
Overtime (c) After an employee’s rostered ceasing time on
any one day; or
(c) After an employee’s rostered ceasing time on any one day; or
Overtime (d) Outside the ordinary hours of work; or (d) Outside the ordinary hours of work.
Overtime (e) Hours worked by part-time employees in excess
of the agreed hours in clause 12.2 or as varied
under clause 12.3.
No equivalent clause
54
Clause Fast Food Industry Award 2010 Variations sought by The Australian Industry Group
in Draft Determination
dated 24 April 2018
Overtime No equivalent clause 27.3 A part-time employee shall be paid overtime for all work as
follows:
(a) In excess of:
(i) 38 hours per week; or
(ii) five days per week (or six days in one week if in the
following week ordinary hours are worked on not more
than four days); or
(iii) eleven hours on any one day; or
(b) Hours worked by a part-time employee outside the employee’s
availability; or
(c) Outside the ordinary hours of work.
Overtime No equivalent clause 27.4 A part time employee shall be paid overtime if directed to
work:
(a) Before the employee's rostered commencing time on any one
day; or
(b) After the employee’s rostered ceasing time on any one day.
Overtime No equivalent clause 27.5 Provided that no overtime penalty is payable for hours worked
within the employee’s availability by the part-time employee in
excess of the guaranteed minimum hours that are:
(a) rostered; or
(b) not rostered in advance but agreed to be worked consistent with
clause 12.7.
