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Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 20A(4) - Application to extend default period for agreement-based transitional
instruments
Able Australia Services
(AG2023/3359)
(AG2023/3360)
ABLE AUSTRALIA COLLECTIVE AGREEMENT 2006-2009
MELBOURNE CITYMISSION RESIDENTIAL/SUPPORT SERVICES
AGREEMENT 2007
Health and welfare services
DEPUTY PRESIDENT WRIGHT
DEPUTY PRESIDENT ROBERTS
DEPUTY PRESIDENT SLEVIN
SYDNEY 23 NOVEMBER 2023
Application to extend the default period for the Able Australia Collective Agreement 2006-2009
and the Melbourne Citymission Residential/Support Services Agreement 2007
[1] Able Australia Services (Able) has applied, pursuant to item 20A(4) of Sch 3 to the Fair
Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (Transitional
Act), to extend the default periods for the Able Australia Collective Agreement 2006-2009
(Able Agreement) and the Melbourne Citymission Residential/Support Services Agreement
2007 (MCM Agreement). The Agreements were made under the Workplace Relations Act
1996 (Cth) and are agreement-based transitional instruments to which item 20A applies.
[2] The applications seek to extend each Agreement for a period of 18 months, until 6 June
2025. Able provided an affidavit of Meagan Downie Knowles in support of its applications.
The Health and Community Services Union (HACSU) informed the Commission that it
supports the applications. Melbourne Citymission (MCM) also made submissions not objecting
to the application but asking that any order in relation to the MCM Agreement be confined to
Able.
[3] Item 20A of Sch 3 to the Transitional Act provides for the automatic sunsetting of
agreement-based transitional instruments by the end of the default period on 6 December 2023,
subject to the capacity to apply to the Commission for an extension of that period for up to four
years in prescribed circumstances. The agreements to which these provisions apply are
commonly known as zombie agreements. The main features of item 20A of Sch 3 are described
in detail in the Full Bench decision in Suncoast Scaffold Pty Ltd1 and we rely upon what is said
in that decision.
[2023] FWCFB 221 [Note: Copies of the zombie agreements to which this
decision relates (AC315302 and AC312394) are available on our website.]
DECISION
AUSTRALIA FairWork Commission
https://www.fwc.gov.au/documents/decisionssigned/pdf/2023fwcfb221.pdf
https://www.fwc.gov.au/documents/agreements/approved/ac315302.pdf
https://www.fwc.gov.au/documents/agreements/approved/ac312394.pdf
[2023] FWCFB 221
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[4] Relevantly, when an application is made under subitem (4) of item 20A of Sch 3 to the
Transitional Act the Commission is required under subitem (6) to extend the default period if
the Commission is satisfied that subitem (7), (8) or (9) applies and it is otherwise appropriate
in the circumstances to do so.
[5] The application is advanced on the basis that subitem (7) applies, and it is otherwise
appropriate in the circumstances to extend the default period. Subitem (7) applies when parties
are bargaining for a replacement agreement.
[6] The Full Bench in ISS Health Services Pty Ltd2 described the three requirements under
subitem (7). The first is the requirement that the application is made at or after the ‘notification
time’ for a proposed agreement as defined in s.173(2) of the Fair Work Act 2009 (FW Act).
The second is that the proposed agreement must cover the same or substantially the same group
of employees as the zombie agreement. The Full Bench stated that this could be established by
comparing the Notice of Employee Representational Rights (NERR) for the proposed
agreement to the coverage clause of the zombie agreement. The third is that bargaining for the
proposed agreement must be occurring.
[7] Ms Knowles’ Affidavit stated that NERRs were issued to employees covered by the
Agreements on 26 July 2023. This was before the applications to extend the agreements were
made. The first requirement referred to in ISS Health Services Pty Ltd is met.
[8] A copy of the NERR was provided. The NERR states Able was bargaining in relation
to an enterprise agreement which it proposed cover employees employed in the direct provision
of residential support services in Victoria. The Able Agreement covers residential and support
services workers employed by Able in Victoria. We are satisfied that the scope of the proposed
agreement covers the same or substantially the same group of employees as the Able agreement.
[9] On its terms the MCM Agreement covers employees employed by MCM in residential
support work. It does not apply to home and community care, in home services, youth services
or outreach services. A transfer of business occurred in 2021 when Able acquired MCM’s
disability support businesses. Part 3 of Schedule 11 of the Transitional Act provides that where
there has been a transfer of business involving a transitional instrument Part 2-8 of the FW Act,
which deals with transfers of business applies equally to transitional instruments. Subitem 8(1)
of Part 3 to Sch 11 modifies Part 2-8 of the FW Act by including transitional instruments as a
transferable instrument for the purposes of Division 2 to Part 3-8. The effect of these provisions
is that Able, as the new employer, and the MCM employees who were engaged by Able, as
transferring employees, were covered by the MCM Agreement. Able informed the Commission
that it currently employs 70 transferring employees. We are satisfied that the scope of the
proposed agreement as stated in the NERR also covers the 70 transferring employees. The
second requirement in ISS Health Services Pty Ltd is met.
[10] Bargaining for a replacement agreement commenced with the HACSU on 31 August
2023. Further meetings were scheduled to occur commencing 6 November 2023 and thereafter
on a fortnightly basis. We are satisfied that the third matter referred to in ISS Health Services
Pty Ltd is met. We are satisfied subitem (7) of Item 20A of Sch 3 of the Transitional Act applies.
[11] As subitem (7) applies, subitem 6(a) requires a consideration of whether it is otherwise
appropriate in the circumstances to extend the default period. In ISS Health Services, the Full
[2023] FWCFB 221
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Bench considered it appropriate to do so where the parties sought time to negotiate a
replacement agreement and are not simply seeking to extend an agreement for the maximum
period for the sake of convenience. The Full Bench also took into account the complexity of
the negotiations due to the number of employees and work sites to be covered by the
replacement agreement. The third factor the Full Bench took into account was that, while the
Zombie Agreement remained in place, the employees would be better off overall than if the
modern award, in this case the Social, Community, Home Care and Disability Services Industry
Award applied
[12] All three of these factors apply to the current applications. The parties have agreed to,
and are, bargaining towards a replacement agreement. Ms Knowles says the bargaining process
is complicated due to the diverse and fragmented worksites and that the employees are casual
and temporary. These matters require time for bargaining representatives to gain instructions
from the employees in bargaining. Ms Knowles also pointed to the complexity arising from
recommendations in the recent report of the Royal Commission into Violence, Abuse, Neglect
and Exploitation of People with a Disability and other complications associated with the need
to consider the report of the Independent Review Panel for the National Disability Insurance
Scheme. Both the recommendations of the Royal Commission and findings of the Report are
expected to have an impact on bargaining. HACSU agreed and pointed to the need to bring
employees currently on different terms and conditions under one agreement. The parties also
agreed that the employees would be better off under the zombie agreements than if the award
applied.
[13] We accept the submissions and are satisfied that it is appropriate in the circumstances
to extend the default period for the agreements. Consequently subitem 6(a) applies. As subitem
6(a) applies we are required to extend the default period.
[14] As the Full Bench observed in Suncoast Scaffolding Pty Ltd3 the Commission has a
discretion as to the length of the extension, subject to the limitation that the extension cannot
be more than four years. The nature of the discretion is such that we are not bound to grant the
period of extension sought in the application. The extension sought by Able, and supported by
HACSU, is eighteen months.
[15] In ISS Health Services Pty Ltd the Full Bench ordered an extension of 12 months
in circumstances where subitem (7) applied. The Full Bench considered this sufficient time for
a replacement agreement to be finalised. Able anticipates that bargaining will be required for
the remainder of 2023 until the end of 2024. Ms Knowles stated the bargaining process is
complicated due to the diverse and fragmented worksites and that it involves casual and
temporary employees, requiring time for bargaining representatives to gain instructions from
employees in bargaining. Time was also necessary to consider the Royal Commission
recommendations and NDIS review report. HACSU agreed and pointed to the need to bring
employees under different terms and conditions under one agreement.
[16] Our view is that these factors are similar to the circumstances considered in ISS Health
Services Pty Ltd and a 12-month extension is appropriate. Our order will extend the default
period for each agreement to 6 December 2024.
[17] MCM made submissions that the order for the MCM Agreement should be confined to
Able and its employees. Submissions were made that there is nothing in the Transitional Act to
prevent an order being so confined. We have some doubt that this is the case. In any event, as
[2023] FWCFB 221
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a matter of discretion, we are not inclined to confine the order. MCM indicated that another
enterprise agreement, the Melbourne City Mission Social, Community and Employment
Services Enterprise Agreement 2019 (2019 Agreement), has scope to cover the work
performed by the 4 MCM employees to whom the zombie agreement still applies. It says the 4
remaining employees will be better off overall under the 2019 Agreement, except for long
service leave entitlements. The long service leave entitlements are better under the MCM
Agreement. MCM said when the MCM Agreement ceases to operate the 2019 Agreement will
apply to the remaining employees and it will continue to afford the more generous long service
leave provisions of the MCM Agreement to them to ensure there is no change in those
entitlements. It seems to us that if the 2019 Agreement entitlements are more beneficial to the
employees there is nothing stopping MCM from applying those terms to the 4 employees for
the next 12 months. It does not have to wait for the zombie agreement to terminate.
Consequently, we will not confine the order we make in relation to the MCM Agreement to
Able and its employees.
[18] An order extending the default period for the Able Agreement and MCM Agreement by
12 months to 6 December 2024 will be published separately. The Agreements are published, in
accordance with the requirements of the Transitional Act as an Annexure to this decision.
DEPUTY PRESIDENT
Printed by authority of the Commonwealth Government Printer
AC315302 AC312394 PR768589
1 [2023] FWCFB 105.
2 [2023] FWCFB 122 at [4].
3 [2023] FWCFB 105 at [18]
OF THE FAIR WORK L MISSION THE SEA
https://www.fwc.gov.au/documents/decisionssigned/pdf/2023fwcfb105.pdf
https://www.fwc.gov.au/documents/decisionssigned/pdf/2023fwcfb122.pdf
https://www.fwc.gov.au/documents/decisionssigned/pdf/2023fwcfb105.pdf
