Fair Work Act 2009
s.156 - 4 yearly review of modern awards

Introduction

[1] In our decision of 23 December 2014 1 (December decision) we commenced dealing with submissions made by the Fair Work Ombudsman (FWO) and a number of other parties which identified certain provisions in modern awards as being inconsistent with provisions of the National Employment Standards (NES) contained in the Fair Work Act 2009 (FW Act). We did so by reference to the following five categories of provisions contended to be inconsistent with the NES2:

(1) Provisions which are concerned with restrictions on the payment of annual leave loading upon termination of employment.

(2) Textile, Clothing, Footwear and Associated Industries Award 2010 provisions.

(3) Provisions about which there appears to be agreement as to both the existence of an inconsistency with the NES and the award variation appropriate to remedy that inconsistency.

(4) Provisions about which there appears to be agreement as to the existence of an inconsistency with the NES, but no agreement as yet concerning the appropriate remedial award variation.

(5) Provisions about which there is, as yet, no agreement as to the existence of an inconsistency with the NES.

[2] As indicated in the December decision, category 1 was referred to the Annual Leave Full Bench for hearing and determination, and category 2 was directed to be dealt with as part of the broader process established for the conduct of the review of the Textile, Clothing, Footwear and Associated Industries Award 2010. 3 In the December decision we went on to make findings concerning the matters raised in categories 3 and 4. In relation to category 5, we provided the parties with an opportunity to provide further submissions in relation to the modern award provisions in this category, and established a timetable for that purpose.

[3] This decision is concerned with, firstly, outstanding issues concerning the award variations to be made to correct the inconsistencies with the NES which we found to exist in the December decision in respect to categories 3 and 4 and, secondly, the alleged inconsistencies in category 5.

Categories 3 and 4

[4] Draft determinations for the variation of modern award provisions in categories 3 and 4 were published on 22 January 2015. Parties were given an opportunity to file written submissions in relation to these draft determinations, and to make further oral submissions at a hearing on 26 February 2015. We will only deal with the draft determinations in this decision to the extent that any party raised any issue with them.

Awards inconsistent with s.87(2) - accrual of annual leave for shiftworkers

[5] In the December decision at paragraphs 86 to 90, we found that identified provisions in a number of modern awards were inconsistent with s.87(2) in that, in relation to the additional week’s leave for persons defined or described as shiftworkers, they impermissibly required a minimum of 12 months’ service before the additional entitlement applied, and also impermissibly provided that the additional entitlement accrued on a monthly and not a daily basis.

[6] The draft determinations for award provisions the subject of this conclusion proposed the deletion of the existing provision and its replacement by a new provision which deals with accrual of annual leave for persons engaged as seven day shiftworkers for only part of a 12 month period and/or for only part of a particular month. For example, the draft determination for the Manufacturing and Associated Industries and Occupations Award 2010 is as follows:

“... By deleting the following text in clause 41.3(b):

‘(b) Where an employee with 12 months continuous service is engaged for part of the 12 month period as a seven day shiftworker, that employee must have their annual leave increased by half a day for each month the employee is continuously engaged as a seven day shiftworker.’

and inserting the following:

‘(b) Where an employee is engaged for part of a 12 month period as a seven day shiftworker, that employee must have their annual leave increased by half a day for each month the employee is continuously engaged as a seven day shiftworker.

(c) An employee engaged for only part of a month as a seven day shiftworker will accrue leave for the part month proportionate to the leave prescribed in clause 41.3(b).’”

[7] The Australian Industry Group (Ai Group) submitted that the effect of paragraph (b) of the proposed replacement provision would be to expand unjustifiably the application of an entitlement for shiftworkers which was more generous than provided for by the NES in that it provided an additional 6 days of annual leave per year of service rather than the one week (five days) provided for by s.87(1)(b)(i). It further submitted that paragraph (c), in its application to persons who only worked shift work for part of a month, would extend the entitlement to persons who were not truly shiftworkers since clause 41.3(a) defined shift workers as “a seven day shiftworker who is regularly rostered to work on Sundays and public holidays” (underlining added). A person who only worked part of a month on shift work would not meet the definition of being “regularly rostered”. Ai Group further submitted that paragraph (c) provided for an accrual method which was inconsistent with the progressive accrual provided for in the NES. Ai Group proposed that it was sufficient to rectify the NES inconsistency to simply delete the existing paragraph (b).

[8] Business SA did not oppose the rewording of the clause, but it expressed similar concerns as Ai Group concerning the expansion to the entitlement which would be effected by paragraph (c). The SA Wine Industry Association supported the Ai Group’s position.

[9] The Australian Manufacturing Workers’ Union (AMWU) broadly supported the draft determination and submitted 4 that it was necessary to achieve the modern awards objective in s.134 of the FW Act. It submitted that the effect of the draft determination would not be to provide a shiftworker with an additional 6 days’ leave, since paragraph (b) only applied to persons who worked part of a 12-month period and therefore by definition could not accrue the full 6 days. To the extent that paragraph (b) of the draft determination provided for a slightly higher rate of accrual, the AMWU submitted that this was justifiable as “additional compensation for shiftworkers managing the often delicate balance of their life, and that of their family, disrupted through changes to working patterns” and that there was “significant upheaval” where, for example, a day worker was moved to seven day shift work “in a family situation where one partner is already required to work on the weekend”. The AMWU disagreed that paragraph (c) expanded the entitlement; it applied only to those who met the requirement in paragraph (b) that the employee be “continuously engaged as a seven day shiftworker”, and clarified the operation of the additional entitlement for an employee who, for example, accessed leave within a month of having commenced their employment or being transferred to seven day shift work. The AMWU proposed a modified version of the draft determination to avoid any doubts arising as to its operation as follows:

“(b) In addition to the leave prescribed at s.87(1)(a)of the Act, wWhere an employee is engaged for part of a 12 month period as a seven day shiftworker, that employee must have their annual leave increased by half a day for each month the employee is continuously engaged as a seven day shiftworker.

(c) The leave prescribed in (b) above accrues throughout the month on a pro-rata basis. An employee engaged for only part of a month as a seven day shiftworker will accrue leave for the part month proportionate to the leave prescribed in clause 41.3(b).”

[10] The Textile, Clothing and Footwear Union of Australia (TCFUA) supported the AMWU’s submissions.

[11] The existing clause 41.3(b) of the Manufacturing and Associated Industries and Occupations Award 2010 is a remnant of pre-award modernisation provisions in which seven day shiftworkers generally had an entitlement to seven days’ additional leave, inclusive of non-working days, applicable for each completed year of service, and those with more than 12 months’ continuous service engaged for only part of the 12 month period as a seven day shiftworker received an extra half day’s leave for each month of continuous engagement as a seven day shiftworker. 5 Under that provision, where a seven day period of leave, inclusive of non-working days, equated to five working days’ leave, the result was that a part-year seven day shiftworker received a greater pro-rata entitlement than a full-year seven-day shiftworker. The rationale for this incongruity between the rate of accrual and the full-year entitlement is not now apparent.

[12] The current clause 41.3(b) operates in a context whereby, for persons who perform seven day shiftwork for completed 12 month periods, the NES entitlement applies - that is, five days’ additional annual leave, progressively accrued according to the employee’s ordinary hours of work. 6 Under the NES, the rate of accrual matches the full-year entitlement. In that quite different context, the rationale for retaining a higher additional entitlement for seven day shiftworkers who work such shiftwork for only part of a year, and extending that entitlement to persons with less than 12 months’ continuous service, is difficult to discern. We consider that the disability associated with working seven day shiftwork should be compensated for by a uniform additional entitlement to annual leave, namely that provided for by the NES, regardless of the period during which seven day shiftwork is worked. The NES provision for progressive accrual of this entitlement is sufficient to deal with the situation of part-year seven day shiftworkers who meet the award requirement in clause 41.3(a) of being “regularly rostered”.

[13] Accordingly the draft determination for the Manufacturing and Associated Industries and Occupations Award 2010 will not be made. Instead, clause 41.3(b) will simply be deleted. Equivalent variations will be made to in respect of the other modern award provisions identified in paragraph [88] of the December decision.

Alpine Resorts Award 2010

[14] In the December decision, we found that clause 11.5 of the Alpine Resorts Award 2010, which provides “The hourly rate of seasonal employees will include an 8.33% loading of the applicable hourly rate instead of annual leave”, was inconsistent with s.87(1) in that, by paying out annual leave as a loading on ordinary pay, it did not provide for the taking of annual leave with pay as properly understood (see Canavan Building Pty Ltd 7) or the payment of untaken annual leave on termination. The draft determination for this award proposed the deletion of the current clause 11.5 and the insertion of the following: “Seasonal employees are entitled to annual leave in accordance with the NES”.

[15] The Australian Ski Areas Association (ASAA), although it did not appear at the earlier hearing of this matter on 24 October 2014 or otherwise make any submissions prior to the December decision, nonetheless now submitted the Full Bench erred in treating clause 11.5 of the Alpine Resorts Award 2010 as falling within category 4, and that the award should have been placed in category 5 on the basis that ASAA contested the issue of NES inconsistency. The ASAA further submitted the decision in Canavan was distinguishable, in that in the ski industry, having regard to the relatively short and fixed-term nature of engagement of employees, the payment of the 8.33% loading was not cashing out of annual leave but “the pre-payment of a payment that employees will inevitably receive upon the termination of their employment pursuant to s.90(2)”. ASAA submitted in the alternative that Canavan was incorrectly decided. In relation to the draft determination, ASAA submitted that clause 11.5 be deleted, but not without consequential adjustment to the rates of pay in order to prevent an effective double-payment of annual leave to employees.

[16] The Australian Workers’ Union (AWU) did not oppose the making of the determination, but noted that it had made an application for the Alpine Resorts Award 2010 to be varied to provide for the payment of an annual leave loading of 17.5% which, it was put, “would mitigate the disadvantage that seasonal employees may otherwise suffer, if they simply just lose that 8.3 [sic] per cent loading”. 8 That submission appeared to assume a reduction in the hourly rate of pay for seasonal employees equivalent to the amount of the 8.33% loading would follow from the making of the draft determination.

[17] We reject the primary submission made by the ASAA. Nothing has been put to us which would cause us to revisit Canavan or our December decision, in which Canavan was applied to clause 11.5 in a straightforward way.

[18] The published draft determination does not provide for any change to the hourly rates of pay for seasonal employees. We accept that the making of the draft determination without any reconsideration of the rates of pay may have the effect that employees effectively pay seasonal employees for annual leave twice: once in accordance with the NES provisions, and a second time by paying hourly rates of pay which appear to have been loaded to account for the payment of annual leave. In circumstances where we have not yet received any submissions from the parties concerning the rates of pay for seasonal employees, we consider it would be premature to proceed to make the draft determination at this stage. We propose instead to convene an urgent conference of the parties to consider the issue of the rectification of the NES inconsistency in clause 11.5, the rates of pay for seasonal employees and the AWU’s application for an annual leave loading on a conjoint basis. This conference will be conducted by Commissioner Bissett.

Air Pilots Award 2010

[19] In paragraph [93] of the December decision, we stated the conclusion that clause 27.8(a) of the Air Pilots Award 2010 was inconsistent with s.89(2) of the FW Act because it placed two impermissible conditions upon the circumstances in which a period of personal/carer’s leave may be accessed during paid annual leave and the period not to be taken to be annual leave, namely that the employee had to be “seriously ill” and the period of personal/carer’s leave had to be of at least seven days’ duration. The draft determination to rectify this proposed that clause 27.8(a) be varied to read as follows:

“Where a pilot becomes ill during annual leave, the duration of such illness may be counted as personal/carer’s leave to the extent that the pilot has credited personal/carer’s leave. Providing that:

(i) the pilot will advise the employer as soon as practicable after the commencement of the illness; and

(ii) produces proof of illness to the employer within seven days of return to duty.”

[20] Ai Group has submitted that the replacement of the criterion “seriously ill” with “ill” means that the proposed new provision is arguably more generous than the NES, which in s.97(a) refers to the entitlement to personal/carer’s leave being available “because the employee is not fit for work because of a personal illness, or personal injury, affecting the employee”. Ai Group proposed that the new provisions be altered to commence as follows:

“Where a pilot becomes so ill during annual leave that they would not be fit for work, the duration of such illness may be counted as personal/carer’s leave to the extent that the pilot has credited person/carer’s leave. Providing that …”

[21] We consider that the Ai Group’s submission has substance, but that the new provision should be modified to reflect the terms of s.97(a) as closely as possible. It will read:

“Where a pilot would not be fit for work during annual leave because of a personal illness, or personal injury, affecting the pilot, the duration of such illness or injury may be counted as personal/carer’s leave to the extent that the pilot has credited personal/carer’s leave. Providing that:

(i) the pilot will advise the employer as soon as practicable after the commencement of the illness or injury; and

(ii) produces proof of illness or injury to the employer within seven days of return to duty.”

Aircraft Cabin Crew Award 2010

[22] In the December decision in paragraph [93] we found that clause 25.9 of the Aircraft Cabin Crew Award 2010 was inconsistent with s.89(2) of the FW Act because it required that an illness be in excess of one day in order for a period of personal/carer’s leave to be accessed during paid annual leave and that period not to be taken to be annual leave. The draft determination to rectify this removes the requirement that the illness be in excess of one day, but retains the pre-existing requirement that the employee must have fallen “ill”. The proposed new provision in its entirety is as follows:

“An employee who:

(a) falls ill while on annual leave;

(b) advises the employer as soon as practicable of such illness; and

(c) produces medical evidence of the illness;

will be allowed to take that period against personal/carer’s leave credits and have the annual leave credit adjusted accordingly. The personal/carer’s leave documentation must be submitted within 15 days of return to duty.”

[23] As with the previous award, the Ai Group has submitted that this results in an entitlement which is more generous than the NES, and proposes that paragraph (a) of the provision be modified to read: “... While on annual leave falls so ill that they are not fit for work ...”.

[24] Unlike the previous award, the draft determination does not change the illness criterion, so that to the extent that the proposed new provision would be more generous than the NES, the same position applies with the existing provision. Notwithstanding this, we will adjust the new provision to more closely reflect the NES. The new provision will be as follows:

“An employee who:

(a) would not be fit for work during annual leave because of a personal illness, or personal injury, affecting the employee;

(b) advises the employer as soon as practicable of such illness or injury; and

(c) produces medical evidence of the illness or injury;

will be allowed to take that period against personal/carer’s leave credits and have the annual leave credit adjusted accordingly. The personal/carer’s leave documentation must be submitted within 15 days of return to duty.”

Horse and Greyhound Training Award 2010

[25] At paragraphs [108] - [109] of the December decision, it was found that clause 10.2 of the Horse and Greyhound Training Award 2010 was inconsistent with s.117(3) of the FW Act because it prescribed shorter periods of notice of termination to be given by employers to probationary employees than required by s.117(3). Clause 10.2(d) currently provides:

“(d) Probationary employees may give, or be given, notice on the following basis:

First week of service	1 day’s notice
Second week of service	2 days’ notice
Third week of service	3 days’ notice
Fourth week of service	4 days’ notice”

[26] The draft determination proposed that the identified inconsistency be rectified by replacing the current provision with the following:

“(d) Probationary employment—notice of termination

(i) Probationary employees may give notice on the following basis:

First week of service	1 day’s notice
Second week of service	2 days’ notice
Third week of service	3 days’ notice
Fourth week of service	4 days’ notice

(ii) Probationary employees must be given one week of notice of termination of their employment".

[27] Ai Group opposed the proposed variation on the basis that it required employers to give notice in accordance with the NES, but probationary employees were only required to give notice in accordance with this clause of the award. Ai Group pointed out that clause 11.2 of the Horse and Greyhound Training Award 2010 was inconsistent with the proposed new provision. Clauses 11.1 and 11.2 provide:

“11.1 Notice of termination is provided for in the NES

11.2 Notice of termination by an employee

The notice of termination required to be given by an employee is the same as that required of an employer except that there is no requirement on the employee to give additional notice based on the age of the employee concerned. If an employee fails to give the required notice the employer may withhold from any monies due to the employee on termination under this award, or the NES, an amount not exceeding the amount the employee would have been paid under this award in respect of the period of notice required by the clause less any period of notice actually given by the employee.”

[28] Ai Group submitted that clause 10.2(d) should be deleted in its entirety, with the result that clause 11.2, read with s.117, would require that the period of notice to be provided for employers and probationary employees be the same - that is, one week. Alternatively it submitted that should the Commission determine to adopt the draft determination, clause 10.2(d)(i) should commence with the words “Notwithstanding clause 11.4 [sic]...” and that clause10.2(d)(ii) should not be included.

[29] We consider that clause 10.2(d) should be deleted in its entirety. In circumstances where the employer must give notice of termination to a probationary employee consistent with the NES prescription, it is difficult to discern a justification for probationary employees being entitled to give a lesser period of notice than other employees under the award - that is, a period of notice equivalent to that of the NES prescription for employers in accordance with clause 11.2. The retention of clause 10.2(d) adds unnecessary complexity to the award without itself constituting an employee entitlement of any particular value.

Category 5

Transfer of employment and service for annual leave purposes - various awards

[30] Section 22(5) of the FW Act deals with when service with one employer counts as service with another employer as follows:

When service with one employer counts as service with another employer

(5) If there is a transfer of employment (see subsection (7)) in relation to a national system employee:

(a) any period of service of the employee with the first employer counts as service of the employee with the second employer; and

(b) the period between the termination of the employment with the first employer and the start of the employment with the second employer does not break the employee’s continuous service with the second employer (taking account of the effect of paragraph (a)), but does not count towards the length of the employee’s continuous service with the second employer.

Note: This subsection does not apply to a transfer of employment between non-associated entities, for the purpose of Division 6 of Part 2-2 (which deals with annual leave) or Subdivision B of Division 11 of Part 2-2 (which deals with redundancy pay), if the second employer decides not to recognise the employee’s service with the first employer for the purpose of that Division or Subdivision (see subsections 91(1) and 122(1)).

[31] As the note to s.22(5) indicates, this provision does not automatically operate with respect to service for the purposes of annual leave accrual. Instead, s.91 provides:

91 Transfer of employment situations that affect entitlement to payment for period of untaken paid annual leave

Transfer of employment situation in which employer may decide not to recognise employee’s service with first employer

(1) Subsection 22(5) does not apply (for the purpose of this Division) to a transfer of employment between non-associated entities in relation to an employee, if the second employer decides not to recognise the employee’s service with the first employer (for the purpose of this Division).

Employee is not entitled to payment for untaken annual leave if service with first employer counts as service with second employer

(2) If subsection 22(5) applies (for the purpose of this Division) to a transfer of employment in relation to an employee, the employee is not entitled to be paid an amount under subsection 90(2) for a period of untaken paid annual leave.

Note: Subsection 22(5) provides that, generally, if there is a transfer of employment, service with the first employer counts as service with the second employer.

[32] The effect of s.91(1) is that, upon a transfer of employment (as defined in s.22(7)) of a national system employee between two non-associated entities occurring, the employee’s period of service with the first employer will not count as part of the employee’s period of service with the second employer for the purpose of ascertaining annual leave entitlements if the second employer decides not to recognise the employee’s service with the first employer.

[33] Notwithstanding this, a number of modern award provisions applicable to the situation just described deem the employee’s service with the first employer to be service with the second employer for annual leave purposes. For example, clause 34.10 of the Food, Beverage and Tobacco Manufacturing Award 2010 provides:

“34.10 Transfer of business
Where a business is transferred from one employer to another, the period of continuous service that an employee had with the old employer must be deemed to be service with the new employer and taken into account when calculating annual leave. However an employee is not entitled to leave or payment instead for any period in respect of which leave has been taken or paid for.”

[34] The full list in which modern award provisions of that nature have been identified is as follows:

Award	Clause
Airport Employees Award 2010	31.10
Building and Construction General On-site Award 2010	17.7
Food, Beverage and Tobacco Manufacturing Award 2010	34.10
Horticulture Award 2010	25.9
Manufacturing and Associated Industries and Occupations Award 2010	41.9
Nursery Award 2010	27.7
Pastoral Award 2010	23.7
Plumbing and Fire Sprinklers Award 2010	18.6
Seafood Processing Award 2010	27.10
Timber Industry Award 2010	33.9
Wine Industry Award 2010	30.9

[35] The National Farmers’ Federation, the Ai Group, the Australian Chamber of Commerce and Industry (ACCI) and Australian Business Industrial and the New South Wales Business Chamber Ltd (ABI and NSWBC) all submitted that the above provisions are inconsistent with the choice conferred on employers by s.91(1) concerning the recognition of service prior to a transmission of employment for the purpose of annual leave entitlements. The AMWU, supported by the AWU, submitted that the provisions were not inconsistent with s.91(1). They referred to s.55(2), under which a modern award may include terms which are permitted by a provision of Part 2-2 (which deals with the NES), and pointed to s.93(4), which permits a modern award to include “terms otherwise dealing with the taking of paid annual leave”, as authorising the provisions in question. They also relied on s.55(4), which permits modern award terms which are ancillary or incidental to the NES or which supplement it.

[36] In relation to clause 17.7 of the Building and Construction General On-site Award 2010, a distinct submission was made by the Construction, Forestry and Mining Union (CFMEU), the Housing Industry Association and the Master Builders’ Association. They contended that clause 17, which was entitled “Industry specific redundancy scheme”, was in its entirety (including clause 17.7) an industry-specific redundancy scheme authorised by s.141 of the FW Act. Under s.123(4)(b), the NES provisions concerning redundancy pay do not apply to employees to whom an industry-specific redundancy scheme in a modern award applies.

[37] We consider that the modern award provisions in question generally are clearly inconsistent with s.91(1). Section 55(1) requires, relevantly, that a modern award “not exclude the National Employment Standards or any provision of the National Employment Standards”. Section 91(1) is a provision of the NES (being contained within Division 6, Annual Leave, of Part 2-2, The National Employment Standards), and the modern award provision excludes s.91(1) in the sense that in their operation they negate the effect of the subsection. 9 A provision which operates to exclude the NES will not be an incidental, ancillary or supplementary provision authorised by s.55(4). Nor do we consider that the provisions in question are to be characterised as dealing with the taking of paid annual leave such as to be authorised by s.93(4); they are rather concerned with the quantum of the annual leave entitlement for which the second employer is liable.

[38] We also reject the specific submission concerning clause 17.7 of the Building and Construction General On-site Award 2010. The expression “industry-specific redundancy scheme”, as used in s.141, is defined in s.12 to mean “redundancy or termination payment arrangements in a modern award that are described in the award as an industry-specific redundancy scheme”. Clause 17.7, despite its location in a clause entitled “Industry specific redundancy scheme”, is not concerned with redundancy or termination payment arrangements. Like the other provisions, it excludes s.91(1).

[39] The identified provisions will be removed.

Annual leave in advance - various awards

[40] In the FWO’s submission of 4 April 2014, a concern was raised that clauses in a number of awards are ambiguous having regard to the terms of s.87(2) of the FW Act, which deals with the accrual of annual leave and s.88 which deals with the taking of annual leave. The award provisions are:

[41] The provisions are not drafted identically, but are similar in substance. For example, clause 34.2 of the Airline Operations – Ground Staff Award 2010 provides:

“34.2 The employer may allow annual leave to an employee before the right thereto has fully accrued, but where the leave is so taken a further period of annual leave will not commence until the expiration of the 12 months’ service in respect of which annual leave was taken.”

[42] Clause 25.2(c)(i) of the Mobile Crane Hiring Award 2010 provides:

“(c) Leave allowed before due date

(i) An employer may allow an employee to take annual leave prior to the employee’s entitlement otherwise arising. In such circumstances, the qualifying period of further annual leave will not commence until the expiration of 12 months in respect of which the leave so allowed was taken.”

[43] The FWO submitted that the provisions are ambiguous, and may be read as implying the existence of a prohibition upon progressive accrual of annual leave under s.87(2) and/or upon the taking of annual leave in the 12 month period following the grant of any annual leave in advance, contrary to s.88. Section 88 provides:

88 Taking paid annual leave

(1) Paid annual leave may be taken for a period agreed between an employee and his or her employer.

(2) The employer must not unreasonably refuse to agree to a request by the employee to take paid annual leave.

[44] The ACCI, ABI and the NSWBC, the CFMEU, the AMWU, the Transport Workers’ Union of Australia (TWU) and the Australian Licenced Aircraft Engineer’s Association (ALAEA) all submitted that the provisions (in those of the three awards relevant to them) were inconsistent with the NES. Ai Group submitted otherwise, contending that the provisions concerned the taking of annual leave and were therefore authorised by s.93(4).

[45] We accept the FWO’s submission that these provisions are ambiguous, and arguably are inconsistent with s.87(2) and s.88. The parties had differing proposals as to how to rectify the provisions. We note that a separate Full Bench dealing with annual leave issues as part of the 4 yearly review is considering a claim for a standard clause concerning the taking of annual leave in advance. We consider that the appropriate course is to publish draft determinations varying the provisions in the three identified awards to remove the 12 month prohibition. Any further modification of the provisions in question will await the decision of the Annual Leave Full Bench concerning the taking of leave in advance.

Unpaid carer’s leave for casual employees - Hair and Beauty Industry Award 2010

[46] Clause 34.2(b) of the Hair and Beauty Industry Award 2010 provides:

“34.2 Casual employees

(a) Casual employees are entitled to be unavailable for work or to leave work to care for a person who is sick and requires care and support or who requires care due to an emergency; and

(b) Such leave is unpaid. A minimum of 48 hours’ absence is allowed by right with additional absence by agreement.”

[47] There was no dispute between the relevant parties, and we accept, that clause 34.2(b) is inconsistent with the NES entitlement to unpaid carer’s leave for casual employees in ss.102-103 of the FW Act. Clause 34.2 appears to require unpaid carer’s leave to be taken in a minimum block of 2 days. However s.103(2) provides that the NES entitlement to 2 days unpaid carer’s leave per occasion may be taken as a single continuous period of up to 2 days or any separate periods to which the employee and the employer agree.

[48] There was disagreement about how to rectify the inconsistency. ABI and the NSWBC submitted that clause 34.2 should be deleted in its entirety since it added nothing to the NES. However the Shop, Distributive and Allied Employees Association (SDA), with the support of the National Retail Association (NRA), proposed the following new clause, which went beyond rectifying the identified inconsistency and added provisions concerning compassionate leave:

“34. Personal/carer’s leave and compassionate leave

34.1 Personal/carer’s leave and compassionate leave are provided for in the NES.

34.2 Casual employees

(a) Casual employees are entitled to unpaid personal/carer’s leave. Casual employees are entitled to be unavailable for work or to leave work to care for a person who is sick and requires care and support or who requires care due to an emergency; and

(b) Casual employees are entitled to unpaid compassionate leave when a member of their immediate family or a member of their household:

(i) contracts or develops a serious personal illness that poses a serious threat to his or her life; or

(ii) sustains a personal injury that that poses a serious threat to his or her life; or

(iii) dies.

(c) Such leave is unpaid. Two days’ absence is allowed by right on each particular permissible occasion, with additional absence by agreement.”

[49] We consider that the existing clause 34.2, even if the inconsistency is rectified, does not supplement the NES in any way. Nor does the new clause 34.2 proposed by the SDA and the NRA. Clause 34.2 will be deleted.

Illness during annual leave - Ambulance and Patient Transport Industry Award 2010

[50] Clause 30.6 of the Ambulance and Patient Transport Industry Award 2010 provides:

“30.6 Illness during annual leave

Where an employee who works on continuous straight day shifts, becomes sick during annual leave for a continuous period of not less than five days or 40 hours on which the employee would otherwise have worked, or a 24 hours rotating shift employee becomes sick whilst on annual leave for not less than five consecutive days, and immediately forwards to the employer, a certificate of a legally qualified medical practitioner, then the number of days not less than five or 40 hours specified in the certificate, will be recredited to the employee’s annual leave entitlement.”

[51] United Voice (UV), supported by the Health Services Union (HSU), submitted (in written submissions dated 14 May 2014 and 3 July 2014) that clause 30.6 is not consistent with s.89(2) because it requires an illness during annual leave to last 5 days before the period of the illness can be re-credited to the annual leave entitlement. No party submitted otherwise.

[52] Clause 30.6 is somewhat ambiguous. It makes no mention of the minimum 5 day illness referred to as having to be claimed as sick leave, so that on one view it provides a more generous entitlement than s.89(2) by allowing the illness period to be credited to the annual leave entitlement but not debited from the personal carer’s leave entitlement. If so, there would be no inconsistency with s.89(2), since s.89(2) is only concerned with the situation where another type of leave is taken during a period of annual leave. There would only be an inconsistency if it is taken to be implicit in the clause that the period of illness will count as personal/carer’s leave. It is not clear whether this is what UV and the HSU are submitting. They did not appear at the hearing on 26 February 2015, so the issue could not be clarified.

[53] We will provide UV, the HSU and any other interested party 14 days to make any further submissions on this issue before we make a final determination about it.

Notice of termination of employment - Educational Services (Post-Secondary Education) Award 2010

[54] Clause 11.2 of the Educational Services (Post-Secondary Education) Award 2010 provides:

“11.2 Notice of termination—teaching staff member

(a) The employment of a teaching staff member (other than a casual employee) will not be terminated without at least four weeks’ notice (inclusive of the notice required under the NES) or the payment of four weeks’ salary instead of notice.

(b) Where a course, previously scheduled, is cancelled because of the failure of students to attend, or to notify the employer that they would not be attending, or because the employer is otherwise made aware that the course will be undersubscribed and therefore have to be cancelled, and the employer cannot give four weeks’ notice of termination of a teaching staff member, notice of at least two weeks will be given.”

[55] The FWO submitted that clause 11.2(b) was inconsistent with s.117(3) of the FW Act, which prescribes minimum periods of notice to be provided by employers of termination of employment. The prescribed periods range from 1–4 weeks dependent on the length of service, with an additional week then being required for employees aged over 45 years who have at least 2 years’ continuous service at the time the notice is given. The FWO submitted that, depending on the length of service of the employee, the capacity to terminate an employee on two weeks’ notice where four weeks’ notice cannot be given might result in an employee receiving a lesser period of notice than provided for in s.117(2).

[56] ABI and the NSWBC submitted that clause 11.2(b) provides for greater entitlements than that provided for in the NES, in that the periods of notice specified in the whole of the clause were prefaced with the words “at least” and thus operated only where they provided a greater entitlement than the NES. In the alternative, ABI and the NSWBC submitted that if clause 11.2(b) was found to be inconsistent with the NES, it should simply be deleted.

[57] The National Tertiary Education Industry Union expressly declined to make a submission on the issue.

[58] We consider clause 11.2(b) to be ambiguous in its interaction with s.117(2). We propose to redraft the clause to prevent it being read as allowing a lesser period of notice than the NES as follows (with the added words underlined):

“(b) Where a course, previously scheduled, is cancelled because of the failure of students to attend, or to notify the employer that they would not be attending, or because the employer is otherwise made aware that the course will be undersubscribed and therefore have to be cancelled, and the employer cannot give four weeks’ notice of termination of a teaching staff member, notice of at least two weeks will be given provided that the minimum notice period required by the NES must be given.”

Cashing out of personal/carer’s leave - Timber Industry Award 2010

[59] Clause 34.4(a) of the Timber Industry Award 2010 provides for the cashing out of untaken excess personal/carer’s leave as follows:

“34.4 Payment for excess accrued personal leave

(a) Where an employee in the General Timber Stream or Wood and Timber Furniture Stream has more than 15 days of accumulated untaken personal leave, the employee may elect in writing that an equivalent payment will be made to the employee and the employer will pay such an employee for any accumulated untaken personal leave exceeding 15 days, up to a maximum payment as for 64 hours, in the case of an employee in the General Timber Stream, or a maximum payment as for 38 hours in the case of an employee in the Wood and Timber Furniture Stream. The employee must be paid at least the full amount that would have been payable to the employee had the employee taken the leave that has been foregone.

(i) In order to make an election to have an equivalent payment made an employee must have sufficient leave accrued to retain a minimum balance of 15 days’ leave after the equivalent payment is made.

(ii) The period of personal leave for which the employee has been paid will not be added to the period of untaken personal leave accrued to the employee.

(iii) The employee may only make this request once in any twelve month period.”

[60] Section 101(1) permits a modern award to include terms providing for the cashing out of paid personal/carer’s leave by an employee, subject to certain requirements specified in s.101(2). One of those requirements (in s.101(2)(b)) is that “each cashing out of a particular amount of paid personal/carer’s leave must be by a separate agreement in writing between the employer and the employee”. Ai Group submitted that clause 34.4(a) was inconsistent with s.101(2)(b) because it did not require the employer’s agreement to any cashing out, nor did it require any agreement in writing. It proposed that clause 34.4 be varied to remedy the inconsistency by the addition of the following paragraph:

“(iv) Each cashing out of a particular amount of paid personal/carer’s leave must be by separate agreement in writing between the employer and the employee.”

[61] The CFMEU acknowledged that clause 34.4(a) was inconsistent with s.101(2)(b) as submitted by the Ai Group, and did not oppose the variation proposed by the Ai Group. No other party made any different submission.

[62] We accept the Ai Group’s submission, and propose to adopt the Ai Group’s proposed variation.

Transport awards

[63] As was noted in paragraph [80] of the December decision, the TWU had identified alleged inconsistencies with the NES in the following award provisions:

Award	Clause
Airline Operations – Ground Staff Award 2010	13.2
Passenger Vehicle Transportation Award 2010	12.2
Road Transport and Distribution Award 2010	14.2
Road Transport (Long Distance Operations) Award 2010	12.2
Transport (Cash in Transit) Award 2010	13.2
Waste Management Award 2010	17.2 and 23.2

[64] However the TWU has since abandoned its contentions in this respect. Since no other party contended these provisions were inconsistent with the NES, we will not consider them further.

Conclusion

[65] With respect to the draft determinations concerning the category 3 and 4 matters, those determinations will now be made with the modifications identified in this decision.

[66] In relation to the category 5 matters, we will publish draft determinations for variations to remedy the NES inconsistencies we have identified. Once those draft determinations are published, parties will be provided with a further 14 days to file written submissions concerning the form of the variations proposed in them.

PRESIDENT

Appearances:

G Norris for the Australian Licensed Aircraft Engineers Association.

S Taylor and A. Moussa for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU).

S Crawford for The Australian Workers’ Union.

S Schreier-Joffe for the Australian Ski Areas Association.

K Scott and L. Izzo for the Australian Chamber of Commerce and Industry, New South Wales Business Chamber and Australian Business Industrial.

B Ferguson and R Bhatt for the Australian Industry Group.

S Maxwell for the Construction, Forestry, Mining and Energy Union.

S Elliffe for the Hair and Beauty Industry Association.

M Adler for the Housing Industry Association.

G Thomas for Master Builders Australia.

O Valair for the Master Plumbers Association, New South Wales.

S McKinnon for the National Farmers’ Federation.

R Patena for the Shop Distributive and Allied Employees’ Association.

H Wallgren for the South Australian Wine Industry Association.

V Wiles for the Textile Clothing and Footwear Union of Australia.

W Carr for the Transport Workers’ Union.

Hearing details:

2015.

Sydney:

26 February.

 1   [2014] FWCFB 9412

 2   Ibid at [72]

 3   Ibid at [74]

 4   AMWU submission, 5 March 2015, para 12.

 5   See e.g. clauses 7.1.1 and 7.1.2 of the Metal, Engineering and Associated Industries Award 1998

 6   Section 87

 7   [2014] FWCFB 3202

 8   Transcript, 26 February 2015, PN 380

 9   See Canavan Building Pty Ltd [2014] FWCFB 3202 at [36]

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