[2017] FWCFB 4419

The attached document replaces the document previously issued with the above code on 28 August 2017.

Inserting the correct paragraph numbers in the table of contents.

Footnote [117] amended by deleting “[2017] FWCFB 4419” and inserting “[2017] FWCFB 4355”.

Associate to Justice Ross

Dated 31 August 2017

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

4 yearly review of modern awards – plain language – standard clauses

CONTENTS

Background

[1] Section 156(2)(a) of the Fair Work Act 2009 (Cth) (the Act) requires the Commission to review all modern awards every four years (the Review). 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. The Commission must review each modern award and, by reference to the matters in s134(1) and any other considerations consistent with the purpose of the modern awards objective, come to an evaluative judgment about the modern awards objective and what terms should be included only to the extent necessary to achieve that objective 1.

[2] This decision concerns an aspect of the plain language redrafting project, which is part of the Review.

[3] In determining whether an award achieves the modern awards objective the Commission must take into account the matters set out in s.134(1)(a) to (h). The matter in s.134(1)(g) is particularly apposite in the context of the plain language redrafting project, that is, ‘the need to ensure a simple, easy to understand, stable and sustainable modern award system.’.

[4] In a Statement issued in 2016 2 a number of clauses in modern awards were identified as ‘standard clauses’, which were to be redrafted as part of the plain language redrafting project. The plain language re-drafting project commenced with the production of a plain language exposure draft of the Pharmacy Industry Award 2010 and includes reviewing the standard clauses in modern awards generally in addition to reviewing award-specific clauses in certain awards that have been selected for re-drafting.

[5] This Full Bench has been constituted to oversee a number of plain language projects as part of the Review. 3 These projects include the development of Guidelines for plain language redrafting of modern awards, the selection of particular awards to be reviewed as part of the plain language project4, a review of the National Training Wage Schedule and other Schedules5 and changes to the structure of exposure drafts developed as part of the Award Stage of the Review. Plain language principles have also been applied to the drafting of new provisions developed as part of the Review including annual leave in advance, cashing out of annual leave, excessive annual leave accruals6 and time off instead of payment for overtime.7

[6] This decision deals with the review of standard modern award clauses following a Statement 8 issued on 20 July 2017 (the July Statement).

[7] The standard clauses subject to plain language re-drafting are:

A. Award flexibility;

B. Consultation about major workplace change;

C. Consultation about changes to rosters or hours of work;

D. Dispute resolution;

E. Termination of employment;

F. Redundancy;

G. Transfer to low paid job on redundancy; and

H. Employee leaving during redundancy notice period.

[8] In the July Statement we expressed a number of provisional views regarding the wording of these standard clauses. Interested parties were invited to comment on the provisional views expressed in the July statement by 4.00 pm on Wednesday 9 August 2017.

[9] Submissions were received from:

• Australian Council of Trade Unions (ACTU); 9


• Australian Industry Group (Ai Group); 10


• Australian Business Industrial and New South Wales Business Chamber (ABI); 11


• “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU); 12


• Business SA; 13


• Construction, Forestry, Mining and Energy Union (CFMEU); 14


• Housing Industry Association (HIA); 15


• Shop Distributive and Allied Employees Association (SDA); 16 and


• Textile, Clothing and Footwear Union of Australia (TCFUA). 17

[10] A Hearing took place on 21 August 2017.

[11] This decision finalises most of the outstanding issues regarding the plain language redrafting of the standard clauses and should be read in conjunction with the July Statement.

Clause A – Award Flexibility (renamed individual flexibility arrangements)

[12] The award flexibility clause was inserted into all modern awards as a result of the award modernisation process in 2008. The award modernisation full bench identified that an award flexibility clause was a priority and published a model award clause as attachment C to a decision 18 in June 2008. The model clause was varied in a decision19 in December 2008. Modern awards which included the award flexibility clause came into effect on 1 January 2010. The award flexibility clause was varied on 12 March 201020 as part of the Transitional Review.21

[13] Changes agreed between the parties as a result of a conference, held before Commissioner Hunt on 11 April 2017 22 (the April conference) are in red.

[14] There are seven outstanding issues in relation to clause A:

(i) Note at A.1

(ii) Proposed amendments to clauses A.1 and A.4

(iii) Deletion of clauses A.5

(iv) Retention of clause A.6

(v) Amalgamation of clauses A.7 to A.9

(vi) Proposed amendment to clause A.8(d)

(vii) Inclusion of A.14 as a clause or a note

(i) Note at clause A.1

[15] At paragraph [14] of the July Statement 23 we expressed the provisional view that the Note at clause A.1 should be deleted.

[16] The ACTU, ABI, Ai Group, Business SA, TCFUA, AMWU, CFMEU, SDA and the HIA all support the view that the Note should be deleted.

[17] We confirm the Note at clause A.1 will be deleted. As mentioned in paragraph [14] of the July Statement, hyperlinked notes will be included in annotated versions of the awards only.

(ii) Proposed amendments to clauses A.1 and A.4

[18] At paragraphs [26] and [27] of the July Statement 24 we expressed the provisional view that clause A.4 be deleted and that clause A.1 be amended to more closely align clause A with s.144 of the the Act. The proposed amendments are noted in red below:

A. Individual flexibility arrangements A.1 Despite anything else in this award, an employer and an individual employee may agree to vary the application of the terms of this award relating to any of the following in order to meet the genuine needs of the employee and the employer: (a) arrangements for when work is performed; or (b) overtime rates; or (c) penalty rates; or (d) allowances; or (e) annual leave loading. NOTE: Arrangements for when work is performed include such matters as hours of work, rostering arrangements and breaks. A.2 An agreement must be one that is genuinely made by the employer and the individual employee without coercion or duress. A.3 An agreement may only be made after the individual employee has commenced employment with the employer. A.4 An agreement may only be made in order to meet the genuine needs of the employer and the employee.

[19] ABI, Ai Group, Business SA, TCFUA, SDA, and HIA support the proposed amendments to clauses A.1 and A.4.

[20] The ACTU does not oppose the combined approach of deleting clause A.4 and incorporating the ‘genuine needs’ issue into an amended clause A.1, but submits that adding the word ‘both’ before ‘the employee’ to the amended wording in clause A.1 ‘to be preferable’ and hence the expression would read ‘in order to meet the genuine needs of both the employee and the employer’.

[21] The ACTU submit that the benefit of having clause A.4 stand on its own is that the reader is more likely to absorb the requirement that an individual flexibility arrangement can only be entered into if it meets the genuine needs of both the employer and employee. 25 The TCFUA, AMWU and CFMEU support the submissions of the ACTU. No party opposed the insertion of the word ‘both’. The various employer organisations expressed ambivalence about the proposal.

[22] We confirm our provisional view that clause A.4 will be deleted and that the expression ‘in order to meet the genuine needs of the employee and employer’ will be incorporated into clause A.1. We also propose to adopt the ACTU’s suggestion of adding the word ‘both’ before ‘the employee’. Such an amendment will reinforce the proposition that the purpose of an individual flexibility arrangement is to meet the genuine needs of both parties.

(iii) Deletion of clause A.5

[23] At a conference dealing with standard clauses, held before Commissioner Hunt on 23 November 2016 26 (the November conference), an ACCI proposal to delete clauses A.5 and A.6 was discussed. ACCI was not in attendance at the November conference. Parties discussed ACCI’s contention that the inclusion of a description about the agreement making process is unnecessary and is not a legislative requirement.27

[24] The proposed clause A.5 states:

‘A.5 Either the employer or the employee may initiate the making of an agreement.’

[25] Parties at the November conference were ambivalent as to the inclusion of clause A.5. 28 At paragraph [31] of the July Statement29 we expressed a provisional view that clause A.5 should be deleted.

[26] The ACTU, Ai Group, AMWU, CFMEU, TCFUA and HIA supported the provisional view to delete clause A.5. Business SA and the SDA did not express a view on the proposed deletion of clause A.5.

[27] We confirm that clause A.5 will be deleted.

(iv) Retention of clause A.6

[28] The proposed clause A.6 is as follows:

‘A.6 An employer who wishes to initiate the making of an agreement must:

(a) give the employee a written proposal; and

(b) if the employer is aware that the employee has, or should reasonably be aware that the employee may have, limited understanding of written English, take reasonable steps (including providing a translation in an appropriate language) to ensure that the employee understands the proposal.’

[29] Clause X.7 is the equivalent term in the current provision and is as follows:

‘X.7 An employer seeking to enter into an agreement must provide a written proposal to the employee. Where the employee’s understanding of written English is limited the employer must take measures, including translation into an appropriate language, to ensure the employee understands the proposal.’

[30] At the November conference parties discussed the ACCI proposal to delete clause A.6. The proposal was supported by Ai Group at that time.

[31] At paragraph [35] of the July Statement 30 we expressed the provisional view that clause A.6 should be retained.

[32] The ACTU, AMWU, TCFUA, CFMEU and SDA support the retention of clause A.6.

[33] In the July Statement we said that if ACCI, Ai Group or any other party wish to pursue deletion of clause A.6 they should file submissions in support of their position by 4.00 pm on Wednesday 9 August 2017.

[34] Ai Group has advised that it no longer pursues the deletion of clause A.6. No submission has been received from ACCI.

[35] We confirm that clause A.6 will be retained.

(v) Amalgamation of clauses A.7 to A.9

[36] At the November conference 31 parties also discussed an ACCI proposal to amalgamate clauses A.7 to A.9.

[37] In the July Statement we said that if ACCI intended to pursue its proposal to amalgamate these clauses then it should advise the Commission accordingly, by 4pm Wednesday 9 August 2017. 32 No submission was received from ACCI.

[38] The ACTU does not support the consolidation of clauses A.7 to A.9 as proposed by ACCI. The AMWU, CFMEU and TCFUA support the submissions of the ACTU.

[39] We have decided not to adopt ACCI’s proposed amalgamation of clauses A.7 to A.9.

(vi) Proposed amendment to clause A.8(d)

[40] At paragraph [42] of the July Statement  33 we expressed the provisional view that the words ‘show how’ in A.8(d) be changed to ‘state how’ in order to make the wording of paragraph (d) more consistent with the other paragraphs in clause A.8. The effect of the proposed change is set out below:

'A.8 An agreement must do each of the following:

(a) state the names of the employer and the employee;

(b) identify the award term or terms to be varied;

(c) set out how the award term, or each term, is varied;

(d) show how state how the agreement results in the employee being better off overall on its making than if the agreement had not been made;

(e) state the date on which the agreement is to start.’

[41] ABI, Ai Group, Business SA and SDA either support or do not oppose the proposed amendment to clause A.8(d).

[42] The ACTU submit that both clauses A.8(c) and (d) should commence with the words ‘set out how’ reflecting the position reached at the November conference 34. The AMWU, CFMEU and TCFUA, support the submissions of the ACTU.

[43] We agree with the variation proposed by the ACTU. Clauses A.8(c) and (d) will commence with the words ‘set out how’. The variation is also consistent with the terms of s.144.

(vii) Inclusion of A.14 as a clause or a note

[44] Clause A.14 is as follows:

‘A.14 The period of notice required under clause A.13 is reduced to a period of not more than 28 days if an agreement made under this clause does not meet a requirement set out both in section 144(4) of the Act and in clause A.’

[45] Parties had raised concerns in relation to clause A.14 being included in the plain language re-draft as a clause rather than a note. 35 The equivalent clause in the current award flexibility clause appeared as a note. The concerns expressed related to whether clause A.14 gives rise to additional requirements to those in s.144(4) of the Act.

[46] At paragraph [62] of the July Statement we expressed the provisional view that clause A.14 should be deleted and replaced with a note. In the July Statement we made the following comments:

‘[56] We acknowledge that including the content of the note under clause X.8(b) of the current term makes proposed clause A.14 an operative term. However, the proposed clause A.14 does not confer any substantive rights or impose any obligations on parties. Clause A.14 creates a termination provision which may be utilised in particular circumstances intended to reflect those captured by s.145(4) of the Act. Where the provision resides, in the Act or in modern awards or both, is a technical distinction which is of little practical consequence. There is no prohibition on duplicating statutory requirements in modern awards terms.’

[47] Parties were invited to make further submissions in relation to the wording of the note.

[48] The ACTU does not oppose the conversion of clause A.14 to a note on substantive merits but submits that there may be a technical barrier in doing so as s.144(4)(d) of the Act positively requires the flexibility term to ‘set out how any flexibility arrangement may be terminated by the employee or employer’. The ACTU does not oppose the wording of the proposed note but submits that it is not an improvement on the note at the current clause X.8(b).

[49] The AMWU, TCFUA and CFMEU support the submissions of the ACTU.

[50] The SDA is not opposed to inserting a note instead of clause A.14; however, they submit that the wording of the current note under X.8(b) is clearer than the wording proposed at paragraph [62] of the July Statement.

[51] The SDA points to the fact that the current note makes reference to the requirements contained in the clause as reflective of the Act and that if these are not met then the agreement may be terminated with written notice of not more than 28 days whereas the proposed wording only refers to an arrangement not meeting the requirements of the Act, it does not reference the clause in the award.

[52] ABI does not oppose the conversion of clause A.14 to a note; however, they expressed concern that the wording proposed at paragraph [62] of the July Statement expands the operation of the provision beyond its current scope. ABI submits that the wording of the current note under clause X.8(b) should be retained. Alternatively, similar wording which restricts the enactment of the shorter period of termination to the non-compliance with the requirements of s.144(4) of the Act should be adopted. 36

[53] Ai Group and Business SA support the inclusion of the note in the terms proposed at paragraph [62] of the July Statement.

[54] We turn first to the ACTU’s contention that s144(4)(d) of the Act points to the necessity of including clause A.14 (or something like it) within the clause itself rather than as a note. Section 144 of the Act provides as follows:

Flexibility terms

Flexibility terms must be included

(1) A modern award must include a term (a flexibility term ) enabling an employee and his or her employer to agree on an arrangement (an individual flexibility arrangement ) varying the effect of the award in relation to the employee and the employer, in order to meet the genuine needs of the employee and employer.

Effect of individual flexibility arrangements

(2) If an employee and employer agree to an individual flexibility arrangement under a flexibility term in a modern award:

(a)  the modern award has effect in relation to the employee and the employer as if it were varied by the flexibility arrangement; and

(b)  the arrangement is taken, for the purposes of this Act, to be a term of the modern award.

(3) To avoid doubt, the individual flexibility arrangement does not change the effect the modern award has in relation to the employer and any other employee.

Requirements for flexibility terms

(4) The flexibility term must:

(a) identify the terms of the modern award the effect of which may be varied by an individual flexibility arrangement; and

(b) require that the employee and the employer genuinely agree to any individual flexibility arrangement; and

(c)  require the employer to ensure that any individual flexibility arrangement must result in the employee being better off overall than the employee would have been if no individual flexibility arrangement were agreed to; and

(d)  set out how any flexibility arrangement may be terminated by the employee or the employer; and

(e)  require the employer to ensure that any individual flexibility arrangement must be in writing and signed:

(i)  in all cases--by the employee and the employer; and

(ii)  if the employee is under 18--by a parent or guardian of the employee; and

(f) require the employer to ensure that a copy of any individual flexibility arrangement must be given to the employee.

(5) Except as required by subparagraph (4)(e)(ii), the flexibility term must not require that any individual flexibility arrangement agreed to by an employer and employee under the term must be approved, or consented to, by another person. (emphasis added)

[55] Section 145 is also relevant, it provides:

Effect of individual flexibility arrangement that does not meet requirements of flexibility term

Application of this section

(1) This section applies if:

(a) an employee and employer agree to an arrangement that purports to be an individual flexibility arrangement under a flexibility term in a modern award; and

(b) the arrangement does not meet a requirement set out in section 144.

Note:         A failure to meet such a requirement may be a contravention of a provision of Part 3-1 (which deals with general protections).

Arrangement has effect as if it were an individual flexibility arrangement

(2)  The arrangement has effect as if it were an individual flexibility arrangement.

Employer contravenes flexibility term in specified circumstances

(3)  If subsection 144(4) requires the employer to ensure that the arrangement meets the requirement, the employer contravenes the flexibility term of the award.

Flexibility arrangement may be terminated by agreement or notice

(4)  The flexibility term is taken to provide (in addition to any other means of termination of the arrangement that the term provides) that the arrangement can be terminated:

(a)  by either the employee, or the employer, giving written notice of not more than 28 days; or

(b)  by the employee and the employer at any time if they agree, in writing, to the termination.

[56] Section 144(1) provides that modern awards must include a flexibility term. Section 144(4)(d) provides that the flexibility term must ‘set out how any flexibility arrangement may be terminated by the employee or the employer’. Clause A.11 of the standard ‘individual flexibility arrangements’ clause expressly deals with how any flexibility arrangement may be terminated.

[57] Section 145(4) provides for the termination of such arrangements in circumstances where the arrangement does not meet a requirement set out in s.144. Importantly, a flexibility term in a modern awards is ‘taken to provide (in addition to any other means of termination of the arrangement that the term provides) that the arrangement can be terminated’ in the manner prescribed in s.145(4)(a) or (b). It follows that there is no need to expressly incorporate the termination provisions in s.145(4)(a) and (b) as a clause within the standard ‘individual flexibility arrangements’ clause.

[58] We confirm our provisional view that clause A.14 be deleted and be replaced by a note. We now turn to the wording of such a note.

[59] The note under the current clause X.8(b) is as follows:

‘NOTE: If any of the requirements of s.144(4), which are reflected in the requirements of this clause, are not met then the agreement may be terminated by either the employee or the employer, giving written notice of not more than 28 days (see s.145 of the Act).’

[60] At paragraph [62] of the July Statement we proposed a note in the following terms:

‘NOTE: If an employer and employee agree to an arrangement that purports to be an individual flexibility arrangement under this award term and the arrangement does not meet a requirement set out in s. 144 then the employee or the employer may terminate the arrangement by giving written notice of not more than 28 days (see s.145 of the Act)’.

[61] The ACTU and the unions favour the insertion of the note under the current clause X.8(b). The difficulty with the retention of this note is the inclusion of the expression ‘which are reflected in the requirements of this clause’. The inclusion of this expression may suggest that the termination options in s.145(4) only operate where the arrangement does not meet a requirement set out in s.144 which is reflected in the flexibility term itself. There is no such limitation in s.145(4).

[62] As to the proposed note (set out in [60] above) ABI contends that it expands the operation of s.145(4) beyond its current scope. The short point is that the termination provisions in s.145(4) should be restricted to the circumstances where there has been non-compliance with the requirements of s144(4).

[63] We disagree with contention that the proposed note expands the operation of s 145(4). The application of s145 (including the termination provisions in s145(4)) is governed by s 145(1) which states:

(1) This section applies if:

(a) an employee and employer agree to an arrangement that purports to be an individual flexibility arrangement under a flexibility term in a modern award; and

(b) the arrangement does not meet a requirement set out in section 144. (emphasis added)

[64] In the course of oral argument both the unions and ABI acknowledged the significance of the issues to which we have referred and the positions they had initially put were not strongly pressed.

[65] We have decided to include a note in the terms proposed at paragraph [62] of the July Statement.

Clause B – major workplace change

[66] The Consultation about major workplace change clause was inserted into all modern awards as a result of the award modernisation process in 2008. In a decision of September 2008 37 the Award Modernisation Full Bench decided to impose an award obligation upon employers to notify employees and their representatives of significant workplace change and to discuss change. In a decision of December 200838, the Full Bench noted that a clause in almost identical terms had appeared in most of the Commission’s award for many years and no issue of substance had been raised concerning its operation during that period.

[67] At a conference dealing with standard clauses, held before Commissioner Hunt on 11 April 2017 39, interested parties reached a consent position regarding clause B—Consultation about major workplace change. The revised standard clause B—Consultation about major workplace change reflects the agreed position of the interested parties following that conference (in red) and is as follows:

[68] The plain language expert did not attend the April conference but provided comments on the parties’ consent position. The plain language expert proposed amendments to clauses B.1 and B.5 and the deletion of clause B.6. The amendments to clause B were discussed at paragraph [67] to [71] of the July Statement 40. Parties were invited to comment on the amendments proposed by the plain language expert.

[69] The amendments proposed by the expert are set out in red as follows:

‘B. Consultation about major workplace change

B.1 If an employer makes a definite decision to make a major change in production, program, organisation, structure or technology excluding a change in any such matter that is provided by for by the award (relevant change) that is are likely to have a significant effects on employees, the employer must as soon as practicable after making that decision:

(a) give notice of the relevant change changes to all employees who may be affected by it them and their representatives (if any); and

(b) discuss with affected employees and their representatives (if any):

(i) the introduction of the changes; and

(ii) their likely effect on employees; and

(iii) measures to avoid or reduce the adverse effects of the changes on employees; and

(c) commence discussions.as soon as practicable after a definite decision has been made..

…

B.5 In clause B:

significant effects, on employees, includes any of the following:

(a) termination of employment; or

(b) major changes in the composition, operation or size of the employer’s workforce or in the skills required; or

(c) loss of, or reduction in, job or promotion opportunities; or

(d) loss of, or reduction in, job tenure; or

(e) alteration of hours of work; or

(f) the need for employees to be retrained or transferred to other work or locations; or

(g) job restructuring.

B.6 Where this award makes provision for alteration of any of the matters defined at B.5, such alteration is taken not to have significant effect.’

[70] The ACTU does not support the proposed changes and submits the amendments re-introduce some of the same difficulties about obligations and timing to discuss that were resolved at the April conference. The ACTU submit that conflating obligations and making both of them subject to an ‘as soon as possible’ requirement leads to a situation where there is no obligation for discussions to conclude, and discussions that do occur are rushed.

[71] The ACTU also submit that the expert’s suggestions confuse the issue of exemptions from ‘significant effect’ of change with the nature of the change itself. Changes and their effects are different concepts. The ACTU noted that this issue was canvassed at length during the April conference and it is surprising that it has presented again.

[72] The ACTU also submits that there appears to be two possible interpretations to the expert’s proposal, both of which are opposed by the ACTU on the basis that they involve substantive change.

[73] The ACTU submit that substantive changes would arise as follows:

‘14. On one view, taking a narrow view of the word “matter” in B.1, the expert’s proposal is that where the award “provides for” the making of changes in “production, program, organisation, structure or technology”, then the obligation to consult does not arise. On this view it is difficult to see how the exclusion would operate in practice, as modern awards rarely make such provision, at least explicitly. The matters that are proposed to be excluded are generally matters of managerial prerogative, the consequences of which are dealt with by awards: awards do not regulate trading hours, but they often do provide for penalty rates during ordinary hours and for overtime outside of this and/or for shift allowances and rest periods.

15. On the alternate view, taking the word “matter” in B.1 at its broadest, the expert has re-introduced the problem of making the entirety of the consultation obligation conditional on exemptions originally designed only to qualify the definition of significant effects. A “major change in production, program, organisation, structure or technology” may have a number of effects. Assume for example, a decision to introduce particular technological change, the introduction of new machinery at a particular location, results in:

(a) the need for retaining;

(b) the need to transfer employees; and

(c) the need to alter working hours.

16. Each of these are “significant effects”. Some awards provide for the alteration of work locations, most provide for the alteration of working hours yet few (if any) provide for the need for retraining. The current qualifier to “significant effects” means that the obligation to consult would remain in our example, at the very least, where the awards did not regulate retraining. On this alternative view of the expert’s proposals, the obligation to consult would not exist at all in relation to any aspect of the change or its effect where the change could be characterised as involving one matter that was otherwise dealt with by the award.’ 41

[74] The AMWU, TCFUA and CFMEU support the submissions of the ACTU.

[75] Ai Group submit that the expert’s proposed changes would alter the operation of the current clause and ought not to be adopted. The Ai Group submit that parties’ agreed position regarding clause B should be adopted.

[76] In relation to clause B.1, Ai Group submit that the agreed position of the parties referred to in paragraph [65] of the July Statement provides that an employer is only required to commence discussions ‘as soon as practicable’. It does not require that the discussions be completed with the same degree of urgency. The Ai Group submit that this is consistent with the substantive obligation flowing from the current standard clause contained within awards. 42

[77] The Ai Group acknowledges the expert’s observation that there is no need to refer to when to begin a discussion if the requirement is that you discuss as soon as practicable, but that this misses the point that was intended to be addressed by the parties through the agreed position. The Ai Group submit that the expert’s re-drafted clause now creates a temporal obligation relating to the giving of notice pursuant to clause B.1(a) and would give rise to a substantive change.

[78] Ai Group submit that the expert’s proposed change to the definition of ‘relevant change’ in B.1 is problematic. While Ai Group do not oppose the intention to define the term, they oppose the proposed inclusion of ‘… excluding a change in any such matter that is provided for by the award’. Ai Group submit that these words should be connected to the definition of significant effect. These words have been struck out from the agreed clause B.1 and included in the agreed B.6. Currently if an award enables the alteration of any matters identified in the current clause 9(a)(ii), the change is deemed not to have significant effect and the obligation identified in the current clause 9(a)(i) does not arise.

[79] Ai Group has not identified any difficulties with the amendments that the expert has proposed to clauses B.5 and B.6 as set out in paragraph [71] of the July Statement. 43

[80] Business SA objects to two elements of the changes proposed by the plain language expert.

(i) the movement of the previously agreed content of clause B.6 into the introductory paragraph of B.1.. Business SA submits that change is inappropriate and introduces a new concept of ‘relevant change’ which alters the meaning of both clauses B.1 and B.5.

(ii) the words ‘excluding a change … (relevant change)’ should be removed from clause B.1 and the word ‘relevant be removed from clause B.1(a).

[81] Business SA also submits that the deletion of clause B.6 is inappropriate and that moving the agreed wording from clause B.6 to clause B.1 creates a substantive change. Business SA submits that clause B.6 should be retained. 44

[82] The SDA submits that the amended B.1 proposed by the expert, which introduces elements of both B.1(c) and B.6, is more ambiguous and does not reflect the agreed position of the parties in relation to the concerns raised. 45

[83] During the April conference, 46 parties raised issues regarding when discussions should commence as part of the consultation process and agreement was reached on wording to resolve the issue. There was also discussion regarding moving ‘(excluding a change in any such matter that is provided for by the award)’.47 It was agreed that the obligation regarding when discussions are to commence should be separate from the general obligation to discuss. It was also agreed that ‘excluding a change in any such matter that is provided for by the award’ (what is a significant effect) needs to be linked to clause B.5 rather than B.1.

[84] The SDA also submits that the introduction of the term ‘relevant change’ in the proposed clause introduces a term which is unnecessary and potentially subjective, which could alter the application of the provision. The use of the term ‘relevant’ could lead to a decision being made about what changes are relevant to the effected employees for the purpose of consultation.

[85] The SDA submits that the proposed new wording raises a question of who determines what is appropriate. A change is already characterised as a major change in production, program, organisation, structure of technology. They submit that if the Full Bench is minded to change the wording, it could be made in clause B.1(a) to include ‘give notice of the major change’ rather than ‘give notice of the relevant change’.

[86] The SDA also submits that clause B.6 should be retained. 48

[87] ABI does not oppose the proposed amendment to clause B.5 or the deletion of clause B.6; however, they do oppose the proposed re-wording of clause B.1.

[88] ABI submits that the proposed wording of clause B.1 is complex and has introduced a number of significant concepts into the one provision, which are:

• that the employer has made a definite decision to make a major change;
• that the change is not one which is otherwise provided for in the Award;
• the definition of that change as being the ‘relevant change’ for the purpose of the rest of the clause (which we note is potentially problematic choice of words);
• that the change must have a significant effect; and
• as soon as practicable after making the decision, the employer must undertake an extensive list of tasks.

[89] ABI submits that the clause already places a significant compliance burden on employers attempting to understand the circumstances requiring consultation, and how to go about undertaking that consultation when it is required.

[90] ABI also expressed concern that the insertion of the timing reference into clause B.1 may give rise to a misapprehension that all of the discussions with the affected employees/representatives must occur ‘as soon as practicable after making that decision’, when currently it is only a requirement that those discussions ‘commence’ at that time. 49

[91] HIA supports the amendments to clause B.1 and B.5 50 as outlined at paragraphs [67] and [71] of the July Statement.

[92] We do not propose to make the changes suggested by the plain language expert. For the reasons advanced by a number of the parties, the proposed changes create a significant risk of altering the substantive legal effect of the existing provision and add complexity to the existing term. We propose to adopt the revised standard clause which reflects the agreed position of the interested parties (see [67] above).

Clause C – consultation about changes to rosters or hours of work

[93] The consultation about changes to rosters or hours of work clause was inserted into all modern awards as result of the Fair Work Amendment Act 2013 which amended the Act by inserting a new provision s.145A. Section 145A provides that all modern awards must include a term requiring employers to consult employees about a change to their regular roster or ordinary hours of work. The wording of the new consultation clause was noted at paragraph 107 of the decision 51 issued on 23 December 2013 and modern awards were varied on the same day to include the clause.

[94] The plain language re-draft of clause C was discussed at the January and April conferences. The revised standard clause C is as follows:

[95] There is one issue outstanding in relation to clause C—Consultation about changes to the rosters or hours of work, as identified in paragraph [76] of the July Statement. 52 Ai Group submitted that as it stands proposed clause C.3(b) requires an employer to invite an employee to give their views about the impact of the proposed change on any affected employee and that this means the employer must invite an employee to express their views about the impact on the family and caring responsibilities of another employee.

[96] The expert reviewed clause C.3(b) and suggested the amendment proposed at paragraph [78] of the July Statement 53 as set out below:

‘(b) invite the employees them to give their views about the impact of the proposed change on them affected employees (including any impact on their family or caring responsibilities) and also invite their representative (if any) to give their views about that impact.’

[97] Parties were invited to comment on the proposed amendment.

[98] The ACTU, ABI, Ai Group, TCFUA, CFMEU, Business SA, SDA and HSU do not oppose the proposed amendments to clause C.3(b).

[99] The changes proposed at paragraph [78] of the July Statement are adopted.

Clause D – dispute resolution

[100] The dispute resolution clause was inserted into modern awards as a result of the award modernisation process in 2008. In a decision 54 in September 2008 the Full Bench decided to include a clause intended to be simple, to emphasise the importance of resolution at the workplace, to encourage parties to agree on a process that would suit them if the dispute reached the Commission and to provide the Commission with the discretion and power to ensure settlement of the dispute. The clause was finalised in a decision55 in December 2008. The Full Bench noted that the operation of the clause was not intended to be confined to issues concerning one employee only and that if the dispute affects a group of employee, for the purposes of the procedure, each member of the group may be represented by the same representative.

[101] The plain language re-draft of clause D—Dispute resolution was discussed during the January and April conferences. The revised standard clause D—Dispute resolution is as follows (agreed changes in red):

[102] There are two matters to be resolved.

(i) the word ‘process’ in clause D.7; and

(ii) the terminology of party/parties versus employer/employee.

(i) The word ‘process’ in clause D.7

[103] During the April conference some concern was expressed about inclusion of the additional word ‘process’ at D.7. 56

[104] The expert has observed that the reference to ‘process’ in clause D.7 relates to the process agreed upon in clause D.5. 57

[105] The ACTU supports the amendment to D.7 to include the word ‘process’ and submits that it is necessary to retain the breadth of representation rights in the existing clause, which refers to representation ‘for the purposes of this clause’. 58

[106] The submissions of the ACTU are supported by the AMWU, TCFUA and CFMEU.

[107] Ai Group, SDA and Business SA, are not opposed to inclusion of the word ‘process’ in clause D.7.

[108] ABI proposes the insertion of the words ‘Fair Work Commission’ in front of ‘process’ in clause D.7 or alternatively to insert the phrase ‘process under clause D.5 or D.6’. 59

[109] We have decided to retain the word ‘process’ in clause D.7. We do not propose to insert the words ‘Fair Work Commission’ as suggested by ABI. We see no reason to confine the right to representation to the Fair Work Commission process in circumstances where the relevant parties may agree on another process for the resolution of the dispute.

(ii) The terminology of party/parties versus employer/employee

[110] During the July conference some concerns were expressed in relation to the terminology used in clauses D.2, D.3, D.4, D.5 and D.7. 60

[111] Ai Group opposes the references to an ‘employer or employee’ being replaced by the words ‘party/parties to the dispute’, if there was any risk that the words could be read to mean anything broader than an employer or an employee. 61

[112] The TCFUA opposes the position of Ai Group and submit that Ai Group’s proposal would narrow the application of the dispute resolution procedure. 62 The TCFUA also expressed concern that the change in terminology may limit the union’s ability to bring a dispute to the Commission in the union’s own name and sought the opportunity to look into the clause further.63

[113] The expert reviewed the parties’ submissions and proposed the following amendment to clause D at paragraph [87] of the July Statement: 64

‘D. Dispute resolution

D.1 Clause D sets out the procedures to be followed if a dispute arises between an employer and one or more than one employee about a matter under this award or in relation to the NES.

D.2 The employer and the employee or employees concerned parties to the dispute must first try to resolve the dispute at the workplace through discussion between the employee or employees concerned and the relevant supervisor.

D.3 If the dispute is not resolved through discussion as mentioned in clause D.2, the employer and the employee or employees concerned parties to the dispute must then try to resolve it in a timely manner at the workplace through discussion between the employee or employees concerned and more senior levels of management, as appropriate.

D.4 If the dispute is unable to be resolved at the workplace and all appropriate steps have been taken under clauses D.2 and D.3, the employer or the employees concerned or any one or more of the employees concerned, party to the dispute may refer it to the Fair Work Commission.

D.5 The parties to the proceeding in the Fair Work Commission may agree on the process to be followed by the Fair Work Commission in dealing with the dispute, including mediation, conciliation and consent arbitration.

D.6 If the dispute remains unresolved, the Fair Work Commission may use any method of dispute resolution that it is permitted by the Act to use and that it considers appropriate for resolving the dispute.

D.7 An employer or an employee party to the dispute may appoint a person, organisation or association to support or represent them in any discussion or process under clause D.

…...’

[114] The ACTU opposes the amendments proposed by the expert at paragraph [87] of the July Statement. The ACTU refer to the comments made during the April conference in particular at paragraphs 2832 – 2836, and 2859 – 2862 which are as follows:

‘PN2832

MR CLARKE:  Well, it could, if you look at some of the - where it's talking about in consultation clauses where representatives have given rights to participate in consultation.  If you had a rogue employer, for one reason or another, and he said well I'll talk to my employees but I'm not letting the union rep in, and the union rep will say hang on a minute, this award says I'm allowed to be here, they want me to be here, you're not letting me in; I've got a dispute.

PN2833

MR FERGUSON:  And I'm just speaking openly with the unions drawn out - but if that was the case, isn't there a difficulty that 23.1 imposes certain obligations on the parties?

PN2834    

MR CLARKE:  Yes.

PN2835    

MR FERGUSON:  But an award that doesn't cover a union can't possibly impose an obligation on the union.  It just can't.

PN2836    

MR CLARKE:  It imposes an obligation on the employer towards the representative, the employee representative.

…

PN2859    

MS BIDDLESTONE:  I think though if you look at, as an example, the consultation about changes to rosters or hours of work, the obligation on the employer is to provide to the employee or employees affected and their representatives any information.  So if an employer then provided information to the employees and not to their appropriate representative, then the union should be able to use the dispute resolution procedure to bring an application to the Commission.  The union is a party to the dispute in that case, not just the employees.

PN2860    

MR NGUYEN:  Commissioner, I think this raises like a broader issue about - well the one thing's like the Ai Group is trying to translate the current legal effect of the current clause over, but there's issues being raised about whether the current clause actually meets the requirements of the Act which say that there has to be a dispute resolution procedure for all matters under the award, and the example that people are describing is a type of dispute that might arise if a representative isn't being provided information, or a union's not being provided information that they're required to be given under the award.  Then according to Mr Ferguson's interpretation, the current dispute resolution procedure clause doesn't actually satisfy the requirement that it be broad enough to encompass all the types of disputes which may arise.

PN2861    

MR FERGUSON:  Perhaps this is all a distraction in any event, because the issue we're actually raising is that the clause quite clearly now only requires that an employer/an employee may appoint another person.  It doesn't enable some other party, nor person who may be a party, to appoint someone else; it just doesn't, and all we're saying is put it back.  Some parties seem to be objecting to that because they would like it to extend to unions, but if we'd approached this with some degree of integrity surely we would just retain employer and employee.

PN2862    

MR NGUYEN:  I don't accept that criticism about integrity.  I'm just suggesting that it raises a broader issue because section 146 requires that there's terms about settling disputes, and it says that this term has to be a procedure for settling disputes about any matters arising under the award, and we've just discussed that there's a type of matter that might be in dispute where it's not between an employer and an employee.’

[115] The ACTU submits that the words ‘party’ and ‘parties’ is in keeping with s.739 of the Act which conditions the Commission’s jurisdiction to deal with a dispute referred to it pursuant to a dispute resolution procedure in a modern award. 65 In particular, s.739(6) provides tha the Commission may deal with a dispute ‘only on application by a party to the dispute’ (also see s.739(4)).

[116] The submissions of the ACTU are supported by the AMWU, TCFUA and CFMEU.

[117] The SDA submits that clause D.7 has changed the legal effect of the current standard term by replacing ‘and/or’ in the current clause with ‘or’ in the plain language draft clause D.7. SDA submits that ‘and/or’ should be retained as the role played by the person, organisation or association throughout the process can be to support and/or represent the employee or employer, not one or the other. 66 The various employer organisations were ambivalent about the change proposed.

[118] ABI, Ai Group, and Business SA do not oppose the amendments proposed by the expert included at paragraph [87] of the July Statement.

[119] Section 139(1)(j) provides that a modern award may include terms about ‘procedures for consultation, representation and dispute settlement’. Section 146 is also relevant, it states:

Terms about settling disputes

Without limiting paragraph 139(1)(j), a modern award must include a term that provides a procedure for settling disputes:

(a) about any matters arising under the award; and

(b) in relation to the National Employment Standards.

Note: The FWC or a person must not settle a dispute about whether an employer had reasonable business grounds under subsection 65(5) or 76(4) (see subsections 739(2) and 740(2)).

[120] The ACTU relies on s.739 to support its contention that the standard clause should refer to a ‘party’ and ‘parties’ to a dispute. Section 739 states:

Disputes dealt with by the FWC

(1) This section applies if a term referred to in section 738 requires or allows the FWC to deal with a dispute.

(2) The FWC must not deal with a dispute to the extent that the dispute is about whether an employer had reasonable business grounds under subsection 65(5) or 76(4), unless:

(a) the parties have agreed in a contract of employment, enterprise agreement or other written agreement to the FWC dealing with the matter; or

(b) a determination under the Public Service Act 1999 authorises the FWC to deal with the matter.

Note: This does not prevent the FWC from dealing with a dispute relating to a term of an enterprise agreement that has the same (or substantially the same) effect as subsection 65(5) or 76(4) (see also subsection 55(5)).

(3) In dealing with a dispute, the FWC must not exercise any powers limited by the term.

(4) If, in accordance with the term, the parties have agreed that the FWC may arbitrate (however described) the dispute, the FWC may do so.

Note: The FWC may also deal with a dispute by mediation or conciliation, or by making a recommendation or expressing an opinion (see subsection 595(2)).

(5) Despite subsection (4), the FWC must not make a decision that is inconsistent with this Act, or a fair work instrument that applies to the parties.

(6) The FWC may deal with a dispute only on application by a party to the dispute.

[121] We do not propose to adopt the ‘terminology’ amendments suggested by the plain language expert. It seems to us that the changes proposed involve a significant, and warranted, departure from the current standard clause. We have decided to adopt the earlier plain language version of the clause (set out at [102] above), with one amendment. We propose to replace ‘or’ with ‘and/or’ in clause D7. We acknowledge that this addition may be said to be inconsistent with plain language drafting/principles but it does reflect the terms of the current standard clause and the material before us suggests that the use of the word ‘or’, simplicitor, may give rise to disputation as to whether or not an organisation is confined to a support or a representative role (but not both).

[122] A comparison between the current standard dispute settlement term and the version we propose to adopt is set out below:

Clause E - Termination of employment

[123] The termination of employment clause was inserted into all modern awards as a result of the award modernisation process in 2008. In a decision 67 in September 2008 the Full Bench decided to include a clause which supplemented the NES by including provisions for notice by employees and a job search leave entitlement. The clause was finalised in December 200868 and a new term was included dealing with the withholding of monies by the employer should the employee fail to give the required notice of termination.

[124] The plain language re-draft of clause E—Termination of employment was discussed at the January and April conferences. The revised standard clause  E—Termination of employment reflecting the agreed position of the interested parties (in red) is as follows:

[125] The parties reached agreement in relation to clause E—Termination of employment during the April conference and the agreed position is at paragraph [93] of the July Statement. 69 The plain language expert reviewed the consent position of the parties and has raised a drafting concern regarding the inconsistency between clause E.1(c) and the explanation in column 1 of the table. The expert proposed the following amendment to clause E.1(c) at paragraph [95] of the July Statement:

‘(c) If an employee fails to give the period of notice required under paragraph (a), the employer may deduct from any money due to the employee on termination (under this award or the NES), an amount not exceeding the amount that the employee would have been paid in respect of the period of notice not given.’

[126] Parties are invited to comment on the proposed amendment to Clause E.

[127] The ACTU do not agree that replacing a reference to a deduction of ‘an amount not exceeding the amount’ with a reference to a deduction of ‘the amount’ creates the option of not deducting the whole amount. Rather, ACTU submits the change proposed by the expert removes that option and oppose the proposed change on that basis. 70

[128] The submissions of the ACTU are supported by the AMWU, TCFUA and CFMEU.

[129] The Ai Group also oppose the wording proposed by the plain language expert and submit that often there will be insufficient monies owing on termination to deduct the full amount of notice not given. Also, sometimes an employer may decide to deduct an amount that is less than the full amount of the notice not given. They say the wording proposed fails to adequately clarify that the employer may deduct less than the full amount of the notice not given. Ai Group submit that the wording agreed between the parties should be retained. 71

[130] Business SA also submits that the words agreed by the parties should be retained and that those words clarify that the employer may be generous and makes the award as simple and easy to understand as possible. 72

[131] The SDA and ABI support the revised standard clause E as set out at paragraph [95] of the July Statement.

[132] During the course of oral argument an issue arose as to whether clause E.1(c), either wholly or insofar as it deals with NES entitlements, is a type of provision which may validly be included in a modern award having regard to the relevant provisions of the Act (including but not limited to ss 55, 118, 139 and 142). Further, to the extent the Commission has power to include a provision such a clause as E.1(c) an issue arises as to whether, as a matter of merit, such a provision is necessary to achieve the modern awards objective.

[133] To provide interested parties with an opportunity to properly consider these issues we published a Statement 73 inviting submissions concerning the identified issues. The matter will then be resolved on the papers unless we consider, upon the request of an interest party, that there should be a further hearing.

Clause F - Redundancy

[134] There are no outstanding issues in relation to Clause F—Redundancy.

Clause G - Transfer to lower paid job on redundancy

[135] The clause regarding transfer to a lower paid job on redundancy was inserted into all modern awards as a result of the award modernisation process as a term in the redundancy provisions. In a decision 74 in September 2008 the Full Bench set out a draft model provision dealing with redundancy which contained provisions dealing with transfers to lower paid duties. The clause was finalised in December 2008.75 

[136] The plain language re-draft of clause G—Transfer to lower paid job on redundancy was discussed at the January and April conferences. The revised standard clause G—Transfer to lower paid job on redundancy is as follows (proposed changes shown in red):

[137] The equivalent current clause is as follows:

‘X.2 Transfer to lower paid duties

Where an employee is transferred to lower paid duties by reason of redundancy, the same period of notice must be given as the employee would have been entitled to if the employment had been terminated and the employer may, at the employer’s option, make payment instead of an amount equal to the difference between the former ordinary time rate of pay and the ordinary time rate of pay for the number of weeks of notice still owing.’

[138] There are three outstanding issues in relation to clause G:

(i) Change in terminology from ‘duties’ to ‘job’ in clause G.1

(ii) Proposed amendment to wording of clause G.2

(iii) ‘Ordinary rate of pay’ in clause G.3

Change in terminology from ‘duties’ to ‘job’ in clause G.1

[139] During the April conference parties had opposing views about the terminology used in clause G.1. 76 The parties undertook to give the issue further consideration and report back to the Commission.

[140] At paragraph [113] of the July Statement 77 interested parties were invited to make further submissions in relation to clause G.1.

[141] Ai Group does not raise any objection to the proposed wording of clause G.1.

[142] The ACTU submit that there is nothing to recommend the proposed clause G.1 over the simpler drafting already in modern awards. The ACTU submit that the redrafting arose from an assumption on the part of the expert that the definition of redundancy for the purposes of the clause should take its meaning from the conditions in s.119 of the Act governing when an entitlement exists to redundancy pay. 78 The ACTU contend that this assumption is incorrect. The ACTU submit that clause G.1 should not attempt to define redundancy if the intention of the present proceedings is not to alter the legal effect of the existing clause.

[143] The ACTU states:

‘24. In any event, it is no more appropriate to adopt wording of section 119 of the Fair Work Act than it is to adopted the wording of section 309(1): the point is that neither purports to provide a general or all purpose definition of “redundancy”, or even a definition at all. One creates a minimum safety net for a payment on termination in certain circumstances and the other creates defence against an unfair dismissal claim.

25. The law today is that “In the industrial context, redundancy of position is not a concept of clearly defined and inflexible meaning”3 and indeed that “redundancy” in industrial an instrument “should be construed consistently with the practice which existed for many years in the area of employment regulated by it”4. In any event, it ought not be forgotten that in the original TCR decision of August 19845, the Conciliation and Arbitration Commission did not define redundancy – the closest it came was to observe that there was “substantial debate” on the issue and to comment that a definition referred to it by the ACTU contained as “a key element…that the employer no longer requires to have the work done by anyone”6. It should also be noted that when the matter was finalised in December 1984, the Commission explicitly declined to develop a standard clause of general application and instead varied only the Metal Industry Award:

“The ACTU asked us to do two things as a result of this case. One was to produce a standard form of clause which could be applied as required to other awards of the Commission, and separately to produce an order in the Metal Industry Award. We have considered this approach but we feel that given what has transpired in this case, it is too difficult to produce a form of clause which could provide some general basis for all awards. As we have already emphasised, it is necessary to tailor the effect of our decision to each individual award. This we have done in the Metal Industry Award and we feel what we have done in that award, plus what we have said in our reasons, will enable other members of the Commission to distil from them what we intend generally to be applied in other awards.”’

[144] The ACTU submits that clause G.1 should read: “This clause applies where an employee is transferred to lower paid duties by reason of redundancy”. 79

[145] The submissions of the ACTU are supported by the AMWU, TCFUA and CFMEU.

[146] ABI submits that the proposed wording of clause G.1(a) does not reflect either the existing provision or s.119 of the Act. They support retention of the word ‘duties’ (as opposed to ‘job’) and re-insertion of the reference to the transfer being ‘by reason of redundancy’. 80

[147] The SDA submits that the expression ‘by reason of redundancy’, which is used in the current award, should be retained and used instead of the proposed wording in clause G.1(a). SDA submits this would remove the contentious issues raised regarding the inclusion of an expanded definition of redundancy and what this should contain.

[148] The SDA submits that the approach taken in the current clause 15.1 which states, Redundancy pay is provided for in the NES, should be used in the drafting of the standard clause. This would also remove the need to include ‘first role’ and ‘second role’ which does not make the clause simple to read.   

[149] The SDA also submits that it is correct to use the word ‘duties’ rather than ‘job’ as this more closely reflects the current award and will not lead to any unintentional change to the scope of the clause and is not ambiguous. 81

[150] HIA submits that the words ‘by reason of redundancy’ be retained within the redrafted clause. In the alternate, HIA submits that modern awards should be consistent with the Act. 82

[151] We have decided to give further consideration to the drafting of clause G.1. We set out the terms of a revised draft later in this decision at [170]. Interested parties will be given an opportunity to comment.

Proposed amendment to wording of clause G.2

[152] At paragraph [114] of the July Statement 83 the Full Bench noted that the plain language expert has proposed revised wording for clause G.2(a) in order to create a reference to the minimum period specified in s.117 of the Act as follows:

‘G.2 The employer may:

(a) give the employee notice of the transfer of at least the same length as the employee would be entitled under section 117 of the Act as if it were a notice of termination given by the employer: or’

[153] The parties were invited to make submissions in relation to the proposed amendment to clause G.2(a).

[154] ABI, Ai Group, Business SA ACTU, AMWU, TCFUA, CFMEU and the SDA do not oppose the proposed amendment to clause G.2 at paragraph [114] of the July Statement.

[155] We have decided to adopt the wording of clause G.2 proposed at paragraph [114] of the July Statement. We note that if any modern award provides for a notice period which is longer than that required by s.117 then the standard cluse in that award would be tailored accordingly.

‘Ordinary rate of pay’ in clause G.3

[156] The third issue concerned the use of the expression ‘ordinary rate of pay’ in clause G.3. The proposed clause G.3 is as follows:

“G.3 If the employer acts as mentioned in paragraph G.2(b), the employee is entitled to a payment of an amount equal to the difference between the ordinary rate of pay of the employee in the first role and the ordinary rate of pay of the employee in the second role for the period for which notice was not given.”

[157] The current equivalent provision of the Manufacturing and Associated Industries and Occupations Award 2010 is clause 23.3, which provides:

‘23.3 Transfer to lower paid duties

Where an employee is transferred to lower paid duties by reason of redundancy the same period of notice must be given as the employee would have been entitled to if the employment had been terminated and the employer may, at the employer’s option, make payment instead of an amount equal to the difference between the former ordinary time rate of pay and the new ordinary time rate of pay for the number of weeks of notice still owing.’ (emphasis added).

[158] In the July Statement we noted that Ai Group had contended that the expression ‘ordinary rate of pay’ was unclear because it might be read as including all amounts payable during ordinary hours, including shift allowances and penalty rates on public holidays, and proposed that the expression ‘ordinary hourly rate of pay’ be used instead. We decided to invite further submissions on the issue.

[159] Pursuant to that invitation, further submissions relevant to this issue were lodged by Ai Group, the SDA, ACTU, AMWU, and ABI.

[160] Ai Group continued to rely upon its earlier submissions referred to in the July Statement, maintaining that the words ‘ordinary rates of pay’ should be substituted with ‘ordinary hourly rate of pay’” 84

[161] The SDA’s submissions were made in the context of modern awards in which it has an interest 85, which did not contain any all-purpose allowances. The SDA submitted, by way of example, that ‘ordinary rate of pay’ under cl 15.2 of the Pharmacy Industry Award 2010, for the purpose of payment of a notice period in relation to a transfer to lower paid duties in the case of redundancy, meant the rate of pay an employee would have received had they worked the period of notice in their existing position and roster. This would be inclusive of any penalty rates the employee would have received for ordinary hours they were rostered to work over that period. The SDA submitted that this was consistent with s.172(2)(b) of the Act, which prescribed the amount to be paid in lieu of notice as including penalty rates and shift allowances. The SDA also referred to the Termination, Change and Redundancy Case Decision86 (TCR Decision) from which the award provision originated and emphasised that its purpose was income maintenance.

[162] The ACTU submitted that the issue should be resolved on the basis that the alternatives of notice and pay in lieu of notice ought to have the same value, and agreed with the SDA that the TCR Decision stated that the employee should have the benefit of maintenance of income payments. 87

[163] The AMWU likewise referred to the TCR Decision, and additionally referred to the Termination, Change and Redundancy Case Supplementary Decision (TCR Supplementary Decision) 88 as also demonstrating that the intention was for an employee not to be financially disadvantaged as a result of an employer deciding to make payment instead of providing notice or for an employer and an employee to agree to transfer an employee early instead of providing notice. The AMWU also submitted that the rate of pay as provided for through the words ‘ordinary time rate of pay’ should be understood to give effect to the intention of the entitlement, which is to provide the employee with a period of notice of the change in their rate of pay, and the entitlement should be expressed in a manner consistent with the NES entitlement to notice. It proposed that the clause be drafted as follows:

'G.3 If the employer acts as mentioned in paragraph G.2(b), the employee is entitled to a payment of an amount equal to the difference between the full rate of pay for the hours the employee would have worked in the first role and the full rate of pay of the employee in the second role for the period for which notice was not given.'

[164] ABI submitted that the issue ‘may be a matter which needs to be determined with reference to individual awards’. 89

[165] The model redundancy provision established in the award modernisation process 90 concerning transfer to lower paid duties, of which the proposed clause G is intended to be a plain English redraft, was itself a limited redraft of the test case standard provision established in the TCR Supplementary Decision. The provision established in the TCR Supplementary Decision was as follows:

‘2. Where an employee is transferred to lower paid duties for reasons set out in clause 1 hereof the employee shall be entitled to the same period of notice of transfer as he/she would have been entitled to if his/her employment had been terminated, and the employer may at his/her option, make payment in lieu thereof of an amount equal to the difference between the former ordinary time rate of pay and the new lower ordinary time rates for the number of weeks of notice still owing.’ 91

[166] There is no indication that the award modernisation Full Bench, beyond tidying up the drafting of the test case provision established in the TCR Supplementary Decision, intended to effect any substantive change in that provision. The best guide as to the intended meaning of that part of the provision which is now sought to be redrafted as clause G.3 is therefore to be found in the TCR Decision and the TCR Supplementary Decision. In the TCR Decision, the Full Bench, at the level of general principle, dealt with the issue of notice of transfer to a lower paid position as follows:

‘However, consistent with the remainder of our decision, we are prepared to provide that where an employee is transferred to lower paid duties because the employer no longer wishes the job the employee has been doing, done by anyone, then the employee should be entitled to the same period of notice of the change in employment as he would have been entitled to if his/her employment had been terminated. Alternatively, the employer shall pay to the employee maintenance of income payments calculated to bring the rate up to the rate applicable to his/her former classification in lieu thereof.’ 92

[167] It is apparent from the above passage that the Full Bench intended that the payment in lieu of notice was intended to equalise the position of the employee to what it would have been if the employee had received actual notice of the transfer. It necessarily follows that the payment, characterised as income maintenance, would include all payments payable to the employee for the working of ordinary time, including all-purpose allowances, loadings and penalties. The reference to the ‘former classification’ in the last sentence reflects the fact that because the ‘duties’ of the new role are ‘lower paid’ than for the old role, a change to the classification level will be involved, but there is no reason to read this as excluding some aspects of total ordinary time pay from the required payment in lieu of notice. The actual clause developed in the TCR Supplementary Decision (earlier set out), which refers to the payment constituting the difference between the old and new ordinary time rate of pay, confirms the Full Bench’s intention in this respect.

[168] Having identified the intended meaning of the existing prescription, it becomes necessary to consider whether the proposed clause G.3 maintains or changes that meaning. On consideration, the use of the expression ‘ordinary rate of pay’ in the proposed clause G.3 may not capture that meaning. As was made clear in the Four yearly review of modern awards decision of 13 July 2015 93, the expression ‘ordinary hourly rate of pay’ was adopted in exposure drafts, in distinction to the expression ‘minimum hourly rate of pay’, on the basis that it was inclusive of all-purpose allowances, but it was not treated as inclusive of shift allowances and penalty rates applicable to ordinary hours of work. We are not minded to adopt the AMWU’s approach of using the expression ‘full rate of pay’, which is a defined expression in s.18 of the Act, because we are anxious to avoid introducing yet another linguistic formulation concerning rates of pay into modern awards, and because the s.18 definition makes it clear that ‘full rate of pay’ includes overtime rates, which would confuse the position. We consider the better course is to modify the provision to specifically include shift allowances and penalty rates where applicable to ordinary time as follows:

‘G.3 If the employer acts as mentioned in paragraph G.2(b), the employee is entitled to a payment of an amount equal to the difference between the ordinary rate of pay of the employee (inclusive of shift allowances and penalty rates applicable to ordinary hours) for the hours of work the employee would have worked in the first role and the ordinary rate of pay (also inclusive of shift allowances and penalty rates applicable to ordinary hours) of the employee in the second role for the period for which notice was not given.’

[169] The reference to shift allowances may be omitted in modern awards which do not provide for shift work.

[170] A revised clause G is set out below:

'G.1 Clause G applies if, because of redundancy, the employer decides to transfer an employee to new duties to which a lower ordinary rate of pay is applicable.

G.2 The employer may:

(a) give the employee notice of the transfer of at least the same length as the employee would be entitled to under section 117 of the Act as if it were a notice of termination given by the employer; or

(b) transfer the employee to the new duties without giving notice of transfer or before the expiry of a notice of transfer.

G.3 If the employer acts as mentioned in paragraph G.2(b), the employee is entitled to a payment of an amount equal to the difference between the ordinary rate of pay of the employee (inclusive of shift allowances and penalty rates applicable to ordinary hours) for the hours of work the employee would have worked in the first role, and the ordinary rate of pay (also inclusive of shift allowances and penalty rates applicable to ordinary hours) of the employee in the second role for the period for which notice was not given.'

[171] Interested parties are invited to make submissions on the revised clause above by 4.00pm on Monday 4 September 2017. Any submissions in reply are to be filed by no later than 4.00 pm on Monday 11 September 2017.

Clause H – employee leaving during redundancy notice period

[172] The clause regarding employees leaving during a redundancy notice period was inserted into all modern awards as a result of the award modernisation process, as part of the standard redundancy provisions.

[173] Clause H—Employee leaving during redundancy notice period was discussed at the January and April conferences. The revised standard clause H—(agreed changes set out in red) is as follows.

Meaning of clauses H.2 and H.3

[174] During the April Conference Ai Group raised concerns about the meaning of clause H.2. 94 At paragraph [132] of the July Statement parties were invited to make submissions in relation to the meaning of clause H.2 at paragraph [132] of the July Statement.95

[175] Ai Group made the following submissions:

‘31. The existing entitlement for an employee who leaves during the notice period is to receive the entitlements that they would have received under the redundancy clause of the award, had they remained in employment until the expiry of the notice. This is a very longstanding entitlement that was inserted into awards following the 1984 Termination, Change and Redundancy Decision 96 and Supplementary Decision97.

32. The entitlement was retained in awards after the 2004 Redundancy Case Decision. 98’

[176] Ai Group submit that the re-drafted wording results in a substantial increase in the entitlements of employees who are made redundant, and a substantial increase in employer costs. Ai Group state that it is not uncommon for an employee to leave during the notice period when the employee’s position becomes redundant. In these circumstances, employees receive their redundancy entitlements and not the annual leave that would have accrued if the full period of notice had been worked out.

[177] Ai Group submit that clause H.2 should be amended as follows:

‘H.2 The employee is entitled to receive the benefits and payments they would have received under Clause H of this award or sections 119-122 of the NES had they remained in employment until the expiry of the notice.’

[178] HIA supports the view expressed by Ai Group in relation to the meaning of clause H.2 as outlined at paragraph [128] of the July Statement. 99

[179] SDA submit that the meaning of clauses H.1, H.2 and H.3 of the revised standard clauses at paragraph [123] of the decision is that:

‘H.1 – An employee who has been provided with notice of termination in circumstances of redundancy is able to terminate their employment during the notice period.

H.2 – if the employee does terminate their employment during the notice period their entitlements are calculated on the basis of the original termination date given by the employer. This provision was included by the Full Bench in the Termination, Change and Redundancy Case (TCR Case) so employees would not be deterred from taking a new job by a loss in any redundancy payments or entitlements.

H.3 – the employee is not entitled to payment for the period of notice which is not worked by the employee, again as provided in the TCR Case.’

[180] The SDA also submits that the decision of the Full Bench in the Termination, Change and Redundancy Case also supports this meaning:

‘The ACTU also made claims which relate to an employee under notice of termination who wishes to leave, for example, where an employee has found a suitable job and is required to take up that job early.

It was claimed that such an employee should be granted the benefits of any redundancy provision because to restrict him/her would discourage workers from finding and taking up other employment opportunities and that the early departure of employees in a redundancy situation will often make little difference to employers. It was also claimed that this would be consistent with the tenor of a number of awards and agreements.

Having regard to the reason for our grant of severance pay, subject to the right of an employer to seek a variation if appropriate circumstances exist, we are prepared to grant this part of the ACTU claim. We would emphasize, however, that such an employee would not be entitled to payment in lieu of notice in such circumstances.’ 100

[181] The SDA submits that clause H.3 is the relevant provision which prescribes what happens to the notice period where an employee leaves during a period of notice in the case of a redundancy. The SDA submits that the notice provisions contained at Clause E.1(c) do not apply under this circumstance and would not permit an employer deducting the period of notice not worked by the employee who leaves during the redundancy notice period.

[182] The SDA submits it is not necessary to amend clause H.3 in the way described by Ai Group at paragraph [134] of the July Statement because the purpose of this clause is not to prescribe the amount of notice to be provided to an employee. The SDA submits the purpose is to remove the obligation for an employer to pay the employee for the period of notice not worked. 101

[183] The ACTU submits that they do not understand there to be a significant difference between the parties on the intended operation of these clauses. The ACTU submits that the principles, as they understand them, are as follows:

‘(a) An employee who has been made redundant is entitled to notice of termination and to redundancy pay.

(b) Redundancy pay is calculated on the basis of years of service.

(c) The calculation of years of service is to be based on the termination date, which is at the end of the notice period.

(d) An employee made redundant may elect to leave their employment before the end of the notice period.

(e) If the employee chooses to do this, even though their employment ends earlier than the employer expected, the redundancy pay should not be reduced to reflect the earlier termination date.

(f) The employee cannot insist on being paid notice pay for the period not worked.’

[184] The ACTU also submits that the real issue appears to be whether or not, if the above transpires, the employer can then make deduction from any other payments due to the employee on the basis that the employee did not give the employer the required period of notice of their termination. That is, are the employer’s rights under clause E.1(c) activated in the above circumstances? ACTU submits that they are not.

[185] The ACTU states that the employee is not giving the employer notice of termination by electing to leave before the expiry of the notice period in these circumstances. Rather, the award is operating to deem the notice period to expire on the employee’s last day of employment.

[186] The ACTU submits that if any amendment is required, H.3 be broken up into two elements as follows:

‘However: (a) The employee is not entitled to be paid for any part of the period of notice remaining after the employee ceased to employed; (b) The employee’s decision to leave their employment in these circumstances does not constitute notice of termination by the employee for the purposes of clause [E.1].’ 102

[187] The ACTU otherwise adopts the submissions of the SDA on this matter. 103

[188] The submissions of the ACTU are adopted by AMWU, TCFUA and CFMEU.

[189] We note that in relation to proposed clause H.2, Ai Group has submitted that where an employee who has been given notice of termination due to redundancy leaves his or her employment before the expiration of the notice period and without giving the required period of notice, the employer is or should be permitted to make deductions from payments other than for redundancy owing to the employee. This proposal gives rise to the same issues that have arisen in respect of clause E.1(c) discussed at paragraphs [131]-[132] above and will be the subject of further submissions.

[190] We will determine the remaining issues in respect of clause H once we have received further submissions on the issues identified above.

Period of notice in clause H.4

[191] Following the January conference clause H.3 was amended. That amendment was noted at paragraph [133] of the July Statement. 104 During the April conference, Ai Group raised a concern about whether the reference to the period of notice in clause H.4(a) is a reference to the period of notice of termination. Ai Group argued that period of notice referred to in H.3 should be the period of notice of termination that someone is entitled to under s.117 of the Act.105

[192] In their written submissions, Ai Group submits that, with regard to the issue raised at paragraphs [133] to [135] of the July Statement, the period of notice referred to in clauses H.1, H.3 and H.4(a) is the period of notice in s.117 of the Act. Ai Group submit that this is consistent with the existing entitlements and that this this issue should be clarified within the wording of the clause. 106

[193] ABI supports the submissions of Ai Group that the relevant period of notice for the purpose of clause H.4 is that to which they are entitled under s.117 of the Act. 107

[194] Business SA submit that there appears to be a third issue arising from the paragraph [124] of the July Statement, namely that draft clause H.4(a) allows a day off without loss of pay for every week of notice the employee receives. Business SA submits that it is appropriate that the minimum award provisions in this clause be based on the minimum notice period provided at s.117 of the Act and that this reference be added at clause H4(a). 108

[195] The ACTU’s position was articulated in the following exchange at the hearing on 21 August 2017 between Mr Clarke, who represented the ACTU, and members of the bench:

PN329      

MR CLARKE:  If the award did deal with what the notice periods were, then certainly - and an over-extended notice period, then we'd want to give full effect to the clause throughout that notice period that was stipulated.

PN330      

COMMISSIONER HUNT:  But if the employer gave six months' notice, you wouldn't press for a day's leave to seek other employment beyond the maximum five weeks, would you?

PN331      

MR CLARKE:  I haven't approached these standard clauses on the basis that they regulate awards above award entitlements, so I've not - I don't recall putting that position and I haven't - I mean others may have, but I've not considered that.

PN332      

JUSTICE ROSS:  Okay.  So you're really looking at the circumstances where an award might provide a minimum period of notice, which is above that in the NES, then that's relevant.  But if an employer decides to voluntarily provide a longer period of notice, well that's in a different category?

PN333      

MR CLARKE:  That was an assumption on my part, others may have some more informed views about that, but I've just approached this on the basis that it wasn't conceding to regulate any entitlements above the safety net, if you like.

PN334      

JUSTICE ROSS:  That's generally been the approach we've been taking too. 

[196] The job search entitlement in clause H.4 originated from the TCR Decision. That decision initially dealt with the issue in the context of the minimum notice periods established for termination of employment generally. The Full Bench firstly established the scale of notice periods required where the termination is at the intiative of the employer which is now found in s.117(3) of the Act. 109 After dealing with the issue of notice of termination by employees, the Full Bench immediately thereafter determined that employees should be entitled to one day off without loss of pay for the purpose of seeking other employment.110 This is the entitlement contained in the proposed standard clause E.2. It is clear in the TCR Decision that the Full Bench was referring to a day’s leave for job search purposes to be taken during the period of notice it had prescribed. Later in the TCR Decision the Full Bench separately dealt in greater detail with the ACTU’s claims concerning assistance to be given to employees who have been made redundant, which included a claim for a job search leave entitlement.111 These claims were dealt with in the TCR Decision immediately after the Full Bench had considered the ACTU claim for notice of a redundancy-based termination of employment and had determined that the general scale of notice periods which it had earlier prescribed would also apply to redundancy-based terminations.112 Read contextually, the conclusion that there should be an entitlement to job search leave of ‘up to one day off without loss of pay during each week of notice’113 was referable to the requirements for notice which the Full Bench had prescribed, and not to an entitlement which continued to apply for each week of any greater notice period which an employer might choose to provide. The actual clause giving effect to this job search entitlement established in the TCR Supplementary Decision114 must necessarily be read in this context.

[197] The two TCR decisions established an integrated suite of provisions where the relationship between the job search entitlement and the requirements for notice of termination at the initiative of the employer was reasonably apparent. In the context of the current Act, the position has become less clear because of the incorporation of the TCR notice provisions into the NES in s.117 of the Act. We therefore accept the Ai Group submission that the standard clause H.4 needs to be modified so that it is made clear the job search leave entitlement does not extend beyond the minimum periods of notice prescribed by s.117. Such a modification is consistent with proposition earlier established in the 4 yearly review that it is not the function of the minimum safety net to regulate the interaction between minimum award entitlements and overaward payments. 115 We consider that this proposition may be extended to the interaction between the NES and payments and benefits in excess of those required by the NES (unless the Act specifically provides to the contrary).

[198] A revised clause H.4(a) consistent with our conclusions is as follows:

H.4 Job search entitlement

(a) Where an employer has given notice of termination to an employee in circumstances of redundancy, the employer must allow the employee time off without loss of pay of up to one day for each week of the minimum period of notice prescribed by s.117(3) of the Act for the purpose of seeking other employment.

[199] Interested parties are invited to make submissions on the revised clause above by 4.00pm on Monday 4 September 2017. Any submissions in reply are to be filed by no later than 4.00 pm on Monday 11 September 2017. Clause H will be finalised on the papers, unless we consider, upon a request from an interested party, that there should be a hearing concering the issue.

Next Steps

[200] This decision finalises the following standard clauses:

• Clause A—Individual Flexibility Arrangements;


• Clause B—Major Workplace Change;


• Clause C—Consultation about changes to rosters or hours of work;


• Clause D—Dispute Resolution;


• Clause F—Redundancy; and


• Clause H—Employee leaving during redundancy notice period.

[201] The finalised standard clauses will be incorporated into all exposure drafts in the coming months. As outlined in earlier statements 116 the Commission is committed to making modern awards easier to use. Each exposure draft will be updated to comply with the minimum recommendations arising from the user consultation processes undertaken as part of the Review.

[202] The order of the clauses in Group 4 exposure drafts were re-ordered in line with the plain language table of contents and structure. After considering comments received from interested persons regarding those awards and throughout the plain language processes we confirm that the preferred structure of awards, as applied to awards re-drafted in plain language and Group 4 awards, will apply to all awards.

[203] Clauses in exposure drafts for Groups 1, 2 and 3 (which are not otherwise included in the plain language re-drafting common issue) will be re-ordered to comply as closely as possible to the structure applied to awards re-drafted in plain language and Group 4 awards.

[204] Some archaic or overly technical language will be replaced in accordance with chapter 6 of the Plain language Guidelines published on 20 June 2017. Examples of archaic language includes the following:

‘the abovementioned’, ‘the aforementioned’, ‘the aforesaid’, ‘the said’

‘herein’, ‘hereinafter’, ‘hereinbefore’,

‘hereby’, ‘hereof’, ‘hereto’, ‘herewith’

‘thereby’, ‘therefor’, ‘therefrom’

‘therein’, ‘thereof’, ‘thereon’, ‘thereto’

‘thereupon’, ‘thereunder’, ‘thereunto’, ‘therewith’

‘whatsoever’, ‘whomsoever’, ‘whosoever’.

[205] Further revised exposure drafts for awards in Groups 1 and 2 incorporating plain language amendments to standard clauses, plain language structure and language in accordance with the Plain Language Guidelines will be published in late November 2017. Updated exposure drafts for awards in Groups 3 and 4 will then follow.

[206] A Statement 117 was issued on 21 August 2017 in relation to clause E—Termination of employment which invited the following submissions:

(1) whether clause E.1(c), either wholly or insofar as it deals with NES entitlements, is a type of provision which may validly be included in a modern award under the relevant provisions of the FW Act, including but not confined to ss.55, 118, 139 and 142; and

(2) to the extent that the Commission has the power to include a provision of the nature of clause E.1(c) in a modern award, whether as a matter as of merit such a provision is necessary to achieve the modern awards objective in accordance with the requirement in s.138.

[207] Submissions in reply are due by 4.00pm on Monday 4 September 2017 and Submissions in reply are due by Monday 11 September 2017. The matter will be resolved on the papers unless we consider, upon the request of an interested party, that there should be a further hearing.

[208] As mentioned in paragraphs [170] and [171] of this decision, we have given re-consideration of the drafting of clause G—Transfer to low paid job on redundancy. The parties are invited to make submissions on the further revised clause. Interested parties may make submissions by 4.00pm on Monday 4 September 2017. Submissions in reply are to be filed by no later than 4.00pm on Monday 11 September 2017. Clause G will be finalised on the papers, unless we consider, upon a request by an interested party, that there should be a hearing concerning the issue.

PRESIDENT

Appearances

Sydney:

Mr B Ferguson on behalf of the Australian Industry Group
Mr M Nguyen on behalf of the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)
Ms K Thomson of behalf of Australian Business Industrial and the New South Wales Business Chamber

Melbourne:

Mr T Clarke on behalf of the Australian Council of Trade Unions
Ms K Biddleston on behalf of the Shop, Distributive and Allied Employees Association
Ms V Wiles on behalf of the Textile, Clothing and Footwear Union of Australia

Canberra:

Mr S Harris on behalf of the Pharmacy Guild of Australia

Hearing details:

Sydney.
2017.
21 August.

ATTACHMENT A

STANDARD CLAUSES – PLAIN LANGUAGE RE-DRAFTING

A. Individual flexibility arrangements

A. 1 Despite anything else in this award, an employer and an individual employee may agree to vary the application of the terms of this award relating to any of the following in order to meet the genuine needs of both the employee and the employer:

(a) arrangements for when work is performed; or

(b) overtime rates; or

(c) penalty rates; or

(d) allowances; or

(e) annual leave loading.

A.2 An agreement must be one that is genuinely made by the employer and the individual employee without coercion or duress.

A.3 An agreement may only be made after the individual employee has commenced employment with the employer.

A.4 An employer who wishes to initiate the making of an agreement must:

(a) give the employee a written proposal; and

(b) if the employer is aware that the employee has, or should reasonably be aware that the employee may have, limited understanding of written English, take reasonable steps (including providing a translation in an appropriate language) to ensure that the employee understands the proposal.

A.5 An agreement must result in the employee being better off overall at the time the agreement is made than if the agreement had not been made.

A.6 An agreement must do all of the following:

(a) state the names of the employer and the employee; and

(b) identify the award term, or award terms, the application of which is to be varied; and

(c) set out how the application of the award term, or each award term, is varied; and

(d) set out how the agreement results in the employee being better off overall at the time the agreement is made than if the agreement had not been made; and

(e) state the date the agreement is to start.

A.7 An agreement must be:

(a) in writing; and

(b) signed by the employer and the employee and, if the employee is under 18 years of age, by the employee’s parent or guardian.

A.8 Except as provided in clause A.9, an agreement must not require the approval or consent of a person other than the employer and the employee.

A.9 The employer must keep the agreement as a time and wages record and give a copy to the employee.

A.10 The employer and the employee must genuinely agree, without duress or coercion to any variation of an award provided for by an agreement.

A.11 An agreement may be terminated:

(a) at any time, by written agreement between the employer and the employee; or

(b) by the employer or employee giving 13 weeks’ written notice to the other party (reduced to 4 weeks if the agreement was entered into before the first full pay period starting on or after 4 December 2013).

Note: If an employer and employee agree to an arrangement that purports to be an individual flexibility arrangement under this award term and the arrangement does not meet a requirement set out in s. 144 then the employee or the employer may terminate the arrangement by giving written notice of not more than 28 days (see s.145 of the Act).

A.12 An agreement terminated as mentioned in clause A.13(b) ceases to have effect at the end of the period of notice required under that clause.

A.13 The right to make an agreement under clause A is additional to, and does not affect, any other term of this award that provides for an agreement between an employer and an individual employee.

B. Consultation about major workplace change

B.1 If an employer makes a definite decision to make major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must:

(a) give notice of the changes to all employees who may be affected by them and their representatives (if any); and

(b) discuss with affected employees and their representatives (if any):

(i) the introduction of the changes; and

(ii) their likely effect on employees; and

(iii) measures to avoid or reduce the adverse effects of the changes on employees; and

(c) commence discussions a soon as practicable after a definite decision has been made.

B.2 For the purposes of the discussion under clause B.1(b), the employer must give in writing to the affected employees and their representatives (if any) all relevant information about the changes including:

(a) their nature; and

(b) their expected effect on employees; and

(c) any other matters likely to affect employees.

B.3 Clause B.2 does not require an employer to disclose any confidential information if its disclosure would be contrary to the employer’s interests.

B.4 The employer must promptly consider any matters raised by the employees or their representatives about the changes in the course of the discussion under clause B.1(b).

B.5 In clause B:

significant effects, on employees, includes any of the following:

(a) termination of employment; or

(b) major changes in the composition, operation or size of the employer’s workforce or in the skills required; or

(c) loss of, or reduction in, job or promotion opportunities; or

(d) loss of, or reduction in, job tenure; or

(e) alteration of hours of work; or

(f) the need for employees to be retrained or transferred to other work or locations; or

(g) job restructuring.

B.6 Where this award makes provision for alteration of any of the matters defined at B.5, such alteration is taken not to have significant effect.

C. Consultation about changes to rosters or hours of work

C.1 Clause C applies if an employer proposes to change the regular roster or ordinary hours of work of an employee, other than an employee whose working hours are irregular, sporadic or unpredictable.

C.2 The employer must consult with any employees affected by the proposed change and their representatives (if any).

C.3 For the purpose of the consultation, the employer must:

(a) provide to the employees and representatives mentioned in clause C.2 information about the proposed change (for example, information about the nature of the change and when it is to begin); and

(b) invite the employees to give their views about the impact of the proposed change on them (including any impact on their family or caring responsibilities) and also invite their representative (if any) to give their views about that impact.

C.4 The employer must consider any views given under clause C.3(b).

C.5 Clause C is to be read in conjunction with any other provisions of this award concerning the scheduling of work or the giving of notice.

D. Dispute resolution

D.1 Clause D sets out the procedures to be followed if a dispute arises about a matter under this award or in relation to the NES.

D.2 The parties to the dispute must first try to resolve the dispute at the workplace through discussion between the employee or employees concerned and the relevant supervisor.

D.3 If the dispute is not resolved through discussion as mentioned in clause D.2, the parties to the dispute must then try to resolve it in a timely manner at the workplace through discussion between the employee or employees concerned and more senior levels of management, as appropriate.

D.4 If the dispute is unable to be resolved at the workplace and all appropriate steps have been taken under clauses D.2 and D.3, a party to the dispute may refer it to the Fair Work Commission.

D.5 The parties may agree on the process to be followed by the Fair Work Commission in dealing with the dispute, including mediation, conciliation and consent arbitration.

D.6 If the dispute remains unresolved, the Fair Work Commission may use any method of dispute resolution that it is permitted by the Act to use and that it considers appropriate for resolving the dispute.

D.7 A party to the dispute may appoint a person, organisation or association to support and/or represent them in any discussion or process under clause D.

D.8 While procedures are being followed under clause D in relation to a dispute:

(a) work must continue in accordance with this award and the Act; and

(b) an employee must not unreasonably fail to comply with any direction given by the employer about performing work, whether at the same or another workplace, that is safe and appropriate for the employee to perform.

D.9 Clause D.8 is subject to any applicable work health and safety legislation

F. Redundancy

Redundancy pay is provided for in the NES.

 1   CFMEU v Anglo American Metallurgical Coal Pty Ltd [2017] FCAFC 123 at [28]-[29]

 2   [2016] FWC 4756

 3   [2016] FWC 4756

 4   See 2016] FWC 2837- The 4 awards are Clerks—Private Sector Award 2010 , General Retail Industry Award 2010, Hospitality Industry (General) Award 2010 and Restaurant Industry Award 2010

 5   [2017] FWCFB 3176 and  [2017] FWCFB 4174

 6    [2016] FWCFB 3177; [2016] FWCFB 3953

 7   [2015] FWCFB 2602; [2016] FWCFB 4258   

 8   [2017] FWCFB 3745.

 9   ACTU submission, 11 August 2017.

 10   Ai Group submission, 11 August 2017.

 11   ABI & NSWBC submission, 14 August 2017.

 12   AMWU submission, 11 August 2017.

 13   Business SA submission, 11 August 2017.

 14   CFMEU submission, 14 August 2017.

 15   HIA submission, 9 August 2017.

 16   SDA submission, 9 August 2017.

 17   TCFUA submission, 11 August 2017.

 18   [2008] AIRCFB 550

 19   [2008] FWCFB 1000

 20   [2013] FWCFB 8859

 21   [2013] FWCFB 8859

 22   Transcript, of 11 April 2017 conference at PNs 2398 – 2752.

 23   [2017] FWCFB 3745 at [14].

 24   Ibid at [26]-[27].

 25   ACTU submission, 11 August 2017, paragraphs 3 – 4.

 26   Transcript of 23 November 2016 conference at PNs 420 – 476.

 27   Ibid at PN420-431

 28   Ibid at PN446-463

 29   [2017] FWCFB 3745 at [31].

 30   [2017] FWCFB 3745 at [35].

 31   Transcript of 23 November 2016 conference at PNs 510 – 511.

 32   [2017] FWCFB 3745 at [43].

 33   Ibid at [42].

 34   ACTU submission, 11 August 2017, paragraph 8.

 35   Transcript of 23 November 2016 conference at PNs 847 – 889.

 36   ABI & NSWBC submission, 14 August 2017, paragraph 1.2.

 37   [2008] AIRCFB 717

 38   [2008] AIRCFB 1000

 39   Transcript, of 11 April 2017 conference at PNs 2398 – 2752.

 40   [2017] FWCFB 3745 at [67] – [71].

 41   ACTU submission, 11 August 2017, paragraphs 11 – 16.

 42   Ai Group submission, 11 August 2017, paragraphs 10 – 17.

 43   Ai Group submission, 11 August 2017, paragraphs 10 – 17.

 44   Business SA submission, 11 August 2017, paragraphs 5 – 6.

 45   SDA submission, 9 August 2017, paragraph 11.

 46   Transcript, of 11 April 2017 conference at PNs 2544 – 2630.

 47   Ibid at PNs 2399 to 2480.

 48   SDA submission, 9 August 2017, paragraphs 13 – 21.

 49   ABI & NSWBC submission, 14 August 2017, paragraphs 2.1 – 2.4.

 50   HIA submission, 9 August 2017, page 1.

 51   [2013] FWCFB 10165

 52   [2017] FWCFB 3745 at [76].

 53   [2017] FWCFB 3745 at [78].

 54   [2008] AIRCFB 717

 55   [2008] AIRCFB 1000

 56   Transcript, of 11 April 2017 conference at PN2830 to 2868.

 57   [2017] FWCFB 3745 at [90].

 58   ACTU submission, 11 August 2017, paragraph 19.

 59   ABI & NSWBC submission, 14 August 2017, paragraph 4.2.

 60   Transcript, of 11 April 2017 conference at PNs 2810 to 2868.

 61   Ibid at PNs 2810 to 2814.

 62   Ibid at PN2815.

 63   Ibid at PN2825 to 2826.

 64   [2017] FWCFB 3745 at [87].

 65   ACTU submission, 11 August 2017, paragraph 18.

 66   SDA submission, 9 August 2017, paragraphs 23 – 26.

 67   [2008] AIRCFB 717

 68   [2008] AIRCFB 1000

 69   [2017] FWCFB 3745 at [93].

 70   ACTU submission, 11 August 2017, paragraph 20.

 71   Ai Group submission, 11 August 2017, paragraphs 22 – 26.

 72   Business SA submission, 11 August 2017, paragraph 9.

 73   [2017] FWCFB 4355

 74   [2008] AIRCFB 717

 75   [2008] AIRCFB 1000

 76   Transcript, of 11 April 2017 conference at PNs 2913 – 2952.

 77   [2017] FWCFB 3745 at [113].

 78   ACTU submission, 11 August 2017, paragraphs 21 – 24.

 79   Ibid at paragraph 26.

 80   ABI & NSWBC submission, 14 August 2017, paragraphs 6.1 – 6.2.

 81   SDA submission, 9 August 2017, paragraphs 29 – 32.

 82   HIA submission, 9 August 2017, page 2.

 83   [2017] FWCFB 3745 at [114].

 84   Ai Group Submission 11 August 2017 at [30]

 85   SDA submission 9 August 2017. Awards are: General Retail Industry Award 2010, Pharmacy Industry Award 2010, Hair and Beauty Award 2010, Storage Services Award 2010, Fast Food Industry Award 2010, Vehicle, Manufacturing, Repair Services and Retail Award 2010.

 86   (1984) 8 IR 34

 87   ACTU submission 11 August 2017

 88   (1984) 9 IR 115

 89   ABI and NSWBC submission 14 August 2017

 90   [2008] AIRCFB 717

 91   (1984) 9 IR 115 at 129

 92   (1984) 8 IR 34 at 67

 93   [2015] FWCFB 4658 at [35]-[47]

 94   Transcript, of 11 April 2017 conference at PNs 3070 – 3089.

 95   [2017] FWCFB 3745 at [132].

 96   1984 Termination, Change and Redundancy Decision Print F6230.

 97   1984 Termination, Change and Redundancy Supplementary Decision Print F7262.

 98   2004 Redundancy Case Decision Print PR032004.

 99   HIA submission, 9 August 2017, page 2.

 100   SDA submission, 9 August 2017, paragraphs 41 – 45.

 101   Ibid, paragraph 45.

 102   ACTU submission, 11 August 2017, paragraphs 30 – 34.

 103   Ibid, paragraph 35.

 104   [2017] FWCFB 3745 at [133].

 105   Transcript, of 11 April 2017 conference at PNs 3070 – 3089.

 106   Ai Group submission, 11 August 2017, paragraphs 35 – 36.

 107   ABI & NSWBC submission, 14 August 2017, paragraph 7.1.

 108   Business SA submission, 11 August 2017, paragraph 12.

 109   (1984) 8 IR 34 at 50

 110   (1984) 8 IR 34 at 50-51

 111   (1984) 8 IR 34 at 66-69

 112   (1984) 8 IR 34 at 65-66

 113   (1984) 8 IR 34 at 68

 114   (1984) 9 IR 115 at 130

 115   Four yearly review of modern awards [2015] FWCFB 6656 (30 September 2015) at [74]

 116   See [2016] FWC 2837 and [2016] FWC 4756 at [39]–-[40]

 117   [2017] FWCB 4355

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