| [2020] FWCFB 3865 [Note: a correction has been issued to this document] |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604—Appeal of decision
Transport Workers’ Union of Australia
v
Prosegur Australia Pty Limited
(C2020/5070)
VICE PRESIDENT HATCHER |
SYDNEY, 23 JULY 2020 |
Appeal against decision [2020] FWC 3139 of Deputy President Sams at Sydney on 17 June 2020 in matter number C2020/4003.
[1] In an earlier decision issued on 13 July 2020 (first decision), 1 we considered and determined an appeal made by the TWU against a decision of Deputy President Sams issued on 17 June 2020 concerning a “jobkeeper enabling direction” issued by Prosegur to employees at its Moorooka Depot in Queensland pursuant to s 789GDC(1) of the FW Act, expressed as effective from 10 June 2020 (original direction). We determined that permission to appeal should be granted, the appeal upheld and the first decision quashed, and that we would proceed to re-determine the dispute application brought by the TWU by arbitration. This decision concerns our re-determination of that application. In this decision, we will adopt the acronyms, abbreviations and defined expressions used in the first decision.
[2] In the first decision, we indicated that the following propositions should guide the re-determination of the application:
“(1) The loss of 35 percent of the pre-pandemic working hours at the Moorooka depot means that some form of jobkeeper direction reducing hours of work for full-time employees is necessary, since the hours table appears to demonstrate that business is unable to sustain full-time working hours.
(2) The position with part-time employees is unclear, since there was no evidence as to what the ordinary hours of part-time employees under their contracts of employment are, and the parties were unable to give any information about this in the appeal. If the weekly ordinary hours of part-time employees are 25 or less, there would appear to be no reasonable purpose in issuing the direction. If the effect of the direction was to increase the ordinary hours of part-time employee (because, say, their contractual ordinary hours were 20 per week), in circumstances where full-time employees were having their ordinary hours reduced, we would consider that to be unreasonable and (for the purpose of s 789GV(7)) unfair.
(3) There is no need for any direction to be issued to reduce the ordinary hours of work of casual employees, since casual employees ordinarily do not have any defined number of ordinary hours but are engaged to perform work as required. However it may be accepted that, for long-term regular casual employees, it is reasonable for them to be provided with some guarantee of hours in order to maintain their connection with the workplace and for Prosegur to derive commercial value from the jobkeeper subsidy it is receiving in respect of them. In that connection, we note the submission made by Prosegur, which was not contradicted by the TWU, that the value of the jobkeeper subsidy for casual employees approximately equated to payment for 50 hours per fortnight.
(4) Prosegur accepts that the terms of its direction does not accurately reflect its intention, namely that all remaining employees are to receive a minimum of 50 hours per fortnight, with any hours in excess of this to be distributed equally amongst employees.
(5) The reasonableness or otherwise of the direction may usefully be assessed by reference to the position that would apply if the direction was not made. The hours table is the most reliable guide to this, since it shows the hours worked and leave hours taken by the employees in the period immediately before the direction took effect. We would conclude from that table that there is enough working hours in total to allow full-time employees to work well in excess of 25 hours per week, and indeed well in excess of 30 hours per week, while still affording the long-term regular casual employees about 25 hours per week. There is no suggestion that, having regard to the distribution of skills in the workforce, Prosegur was unable to meet customer needs over this period. The direction does not reflect this.
(6) It appears unusual and, prima facie, unfair that the hours table shows that part-time employees are generally receiving the same hours, or in some cases, more hours, than full-time employees.
(7) The assessment of the reasonableness or otherwise of the direction must take into account in a significant way the statutory, award, agreement and contractual entitlements of the employees which are affected by the direction. There was little evidence about this. It can safely be said that the full-time employees have an entitlement to 38 paid ordinary hours per week and that part-time employees have an entitlement to a fixed number of ordinary hours per week which is less than 38 (but is otherwise unknown). The long-term regular casual employees have no entitlement to a fixed number of ordinary hours, but merely an expectation of ongoing work, and the 25 percent casual loading which they receive compensates, in part, for this lack of guaranteed hours. We consider that the assessment of the reasonableness of the direction must take into account whether the deprivation or reduction of pre-existing entitlements to hours of work disproportionately and unfairly affects one category of employee over another. Prima facie, the direction imposes a disproportionate reduction in entitlements for full-time employees.
(8) It is relevant that full-time employees and part-time employees may, depending on the extent of their accruals, have the capacity to access leave entitlements if necessary to supplement their income in the face of reduced hours of work, and full-time employees may also have access to accrued RDOs.
(9) The position which applied before the pandemic in respect of working hours is of limited relevance. The evidence about this, which was not statistical in nature, suggests that the hours previously worked by full-time and part-time employees included overtime hours. We agree with the statement made by the Deputy President in paragraph [30](1) of the decision, which is set out above, concerning overtime. There is (in the absence of a specified enterprise agreement or contractual provision otherwise) no entitlement to overtime, so that a jobkeeper direction is not necessary to reduce overtime hours. Similarly, as earlier stated, a jobkeeper direction is not necessary to reduce the hours that a casual employee might have enjoyed prior to the pandemic.
(10) The alternative direction proposed by the TWU at first instance is plainly unworkable. Prosegur cannot reasonably be expected to operate a system of allocating work which requires them to ensure that every employee is receiving the same proportionate reduction in hours as compared to the position prior to the pandemic and at the same time properly service their clients’ needs. If there is to be any alternative direction, it must be administratively workable and allow Prosegur to conduct its operations efficiently.” 2
[3] In the first decision, we made the following orders:
(1) Permission to appeal is granted.
(2) The appeal is upheld.
(3) The decision ([2020] FWC 3139) is quashed.
(4) The parties are directed to confer in relation to the above reasons for decision.
(5) The parties are directed to file any further written submissions in the re-hearing of the matter by 5.00pm Friday 17 July 2020.
[4] In relation to the re-determination of the dispute application by arbitration, we indicated (at paragraph [39] of the first decision) that should the dispute not be resolved by the parties conferring with regard to the propositions reproduced at [2] above, the dispute would then be re-determined by arbitration. We indicated that:
“…submissions may include any proposals any party wishes to advance for the making of an alternative jobkeeper direction, and should contain information concerning the contracted guaranteed ordinary hours of the part-time employees.”
[5] Further, we indicated that should the parties consider that further mediation or conciliation by the Commission would be of utility, this would be provided on request. We received no such request.
[6] We have now received submissions from the parties pursuant to order (5) in the first decision.
[7] The TWU submitted that the Full Bench should, in exercise of the power under s 607(3)(b) of the FW Act, make a direction pursuant to s 789GV(4)(c) setting aside the original direction and substituting it with the following:
“1. Full-Time employees’ ordinary hours be reduced to a minimum of 30-hours per week.
2. Prosegur Australia Pty Limited is to allocate, so far as reasonably possible, work to its employees to whom the Prosegur Australia Pty Limited, Queensland, Moorooka Armoured Vehicle Operator, Enterprise Agreement 2020-2023 applies as follows:
(a) to full-time employees, up to a minimum of 30 ordinary hours per week;
(b) to part-time employees, up to a minimum of 25 hours per week;
(c) to casual employees, up to 20 hours per week,
with all work exceeding 610 hours per week allocated, so far as reasonably possible, in the following order of priority:
(a) to full-time employees (up to 38 hours per week);
(b) to part-time employees (up to 30 hours per week);
(c) to casual employees.”
[8] In relation to the unreasonableness of the original direction, the TWU submitted that:
• pursuant to clause 14.2 of the Prosegur Australia Pty Limited, Queensland, Moorooka Armoured Vehicle Operator, Enterprise Agreement 2020-2023 (Agreement), regular part-time employees are employees who work more than 24 hours per week and Prosegur is required, at the time of engagement, to detail to these employees their pattern of work and span of ordinary hours, however current part-time employees do not have specified ordinary hours;
• as such, there is no need for any jobkeeper enabling direction to pertain to part-time employees, particularly as the original direction is plainly unreasonable as it operates to increase part-time employees’ ordinary hours to 25 (at the expense of full-time employees) and unfair for the purposes of s 789GV(7);
• pursuant to clause 14.3.1 of the Agreement, casual employees have no minimum or ordinary hours and do not reasonably have any expectation of being afforded a minimum number of hours, and so the original direction is unreasonable and unfair because it operates to provide minimum hours of work to casual employees while reducing the minimum ordinary hours of full-time employees; and
• the proposed amended direction described at [38](4) of the first decision suffers from the same elements of unreasonableness and unfairness as the original direction.
[9] The TWU submitted that since the COVID-19 pandemic commenced, Prosegur had more than 625 hours of work (being 25 hours for each of its 25 employees) available to allocate each week, as set out in the table appended the first decision. It determined from this table that the average hours of work per week was closer to 740 hours and contended that a direction that reduces minimum hours overall to 625 is not proportionate to work that is actually available or likely to be available to allocate to employees. Rather, such a direction is “overwhelmingly precautionary in nature” and seeks to afford Prosegur “flexibility” out of proportion to the actual circumstances or those which may be reasonably forecasted.
[10] As to the reasonableness of its proposed direction, the TWU submitted that the direction required in the circumstances is one that:
• sets a minimum number of hours for full-time employees only;
• sets out the manner in which hours of work are allocated reasonably and fairly between categories of employees; and
• ensures the hours allocated are above the minimum ordinary hours of part-time employees and the reduced minimum hours of full-time employees.
[11] The proposed direction provides that of the 130 hours above the 610 which are available to be allocated amongst employees, the additional hours are to be allocated as far as reasonably possible, first to full-time employees, second to part-time employees and last to casual employees. The proposed direction is structured this way, it submitted, to ensure that full-time employees receive as close to their ordinary hours of work as possible and that part-time employees receive next priority, as they have a reasonable expectation of receiving a certain number of hours of work each week, unlike casual employees. The requirement to allocate up to 30 additional hours to part-time employees prior to allocating work to casual employees is based on the evidence from the table that part-time employees are currently working at least and often more than 30 hours per week.
[12] The TWU contended that the proposed direction is fair because it also operates fairly to Prosegur, in that it permits it to continue to utilise casuals for the covert work that they generally perform and enables Prosegur to reduce full-time hours in light of the downturn in work it has experienced.
[13] Prosegur submitted the following alternative jobkeeper enabling direction that would apply to full-time employees only:
“… the JobKeeper Enabling Direction issued to you on 9 June 2020 will be replaced by a new JobKeeper Enabling Direction that you will be rostered to work a minimum of 60 hours a fortnight (i.e an average of 30 hours per week) (New Direction).
. . .
It is our intention to offer you as close to your ordinary hours as possible where additional work is available taking into account operational factors (such as customer requirements; employee availability, skills and experience; type of work and run scheduling practicalities) and our intention to provide part time and casual employees who were working more than 50 hours a fortnight prior to COVID-19 a minimum of 50 hours a fortnight. We propose to spread, as evenly as possible subject to operational requirements, extra available work for full time employees amongst full time employees.
We also commit to the following:
1. We will not roster a part time or casual employee on any given day in preference to you where you are willing and available to work; and
2. We will not require any employee to increase their hours.
. . .
The New Direction will continue up to and including 27 September 2020 unless withdrawn or replaced by a new direction in writing prior to that date.”
[14] In response to the concerns relating to part-time employees’ contracted guaranteed ordinary hours identified in the first decision, Prosegur submitted that clause 14.2.2.1 of the Agreement provides only for minimum hours for part-time employees rather than fixing actual hours: “a regular part-time employee is an employee who works more than 24 hours per week”, with clause 37.1 providing that there would be a maximum of 38 ordinary hours per week. Individual contracts of employment incorporate the agreement terms and do not change the agreement’s position as to ‘ordinary hours’ for part-time employees. Prosegur also submitted that prior to the COVID-19 pandemic, “part-time employees were regularly working close to or more than 38 hours per week”.
[15] In relation to its proposed direction, Prosegur submitted that:
• full-time employees will be guaranteed a minimum of 60 hours fortnightly necessitated by the 35% loss of pre-pandemic working hours in accordance with s 789GDC(1)(a)(iii). The proposed direction sets a fortnightly minimum to provide flexibility and thereby to ensure it is “administratively workable” and “operation[ally] efficient” despite week by week fluctuations;
• it wishes to inform its part-time employees that they will be rostered a minimum of 50 hours fortnightly without issuing the proposed direction to part-time employees as it is legally unnecessary;
• the difference between the hours allocated to full-timers and part-timers (60 vs 50 hours fortnightly) is intended to: “(1) be administratively workable and operationally efficient; (2) preserve the commercial value of the JobKeeper subsidy for part-time employees as the business needs; and (3) guard against disproportionate impact on one category of employees over another”;
• similarly to above, Prosegur acknowledges that it is legally unnecessary to issue the proposed direction to casual employees, however it wishes to guarantee a minimum of approximately 50 hours fortnightly given: “(1) casuals’ engagement on a regular and systematic basis and the fact that Prosegur wishes to maintain their workplace connection…; (2) casual employees comprise 11/25 employees; (3) hours at that level (50 hours fortnightly) are operationally required; and (4) Prosegur needs to derive commercial value from the JobKeeper subsidy”; and
• any greater differentiation of minimum hours between different categories of employees is not “administratively workable” and “operation[ally] efficient” for reasons including that it would be operationally unworkable to reduce part-time and casual hours to fewer than 25 hours weekly to reallocate those hours to full-timers during their ordinary business hours.
[16] In addition to the above submissions, Prosegur filed a witness statement of Mr Gavin Lynch, Prosegur’s National Workplace Relations Manager, which appended an updated weekly hours spreadsheet and Prosegur’s proposed direction. Mr Lynch gave the following evidence:
• the minimum 60 hours a fortnight in the proposed direction is Prosegur’s considered assessment of the minimum hours they can guarantee each full-time employee at the Moorooka Depot based on the most recent data and anticipated business conditions for the foreseeable future;
• runs are still not as long as they previously were prior to the pandemic which means that full-time employees are still often working less than 7.6 hours per day. Runs are often not as long as they were pre-pandemic due to the reduction of work from ATMs;
• requiring Prosegur to ensure that all full-time employees work 38 hours per week before any work is allocated to part-time or casual employees would be operationally impractical, inefficient and would cause detriment to their customers and business for reasons including that different categories of employees perform different work and requiring employees to complete different runs they are not familiar with is inefficient; and
• the Moorooka Branch is still suffering a downturn in work of approximately 30 to 35 per cent on the pre-pandemic levels of work.
[17] The TWU submitted that Prosegur’s proposed direction as set out above at [13] is liable to operate unreasonably and unfairly in the circumstances. The TWU submitted firstly that there is no evidence that minimum full-time hours need to be averaged over a fortnight and that such a direction is unnecessarily precautionary and liable to result in full-time employees working less than they otherwise would. Secondly, much of the content of Prosegur’s proposed direction are not matters that can be included in a direction issued under s 789GDC(1) but rather are statements of aspiration which are beyond the power of s 789GDC(1)(a). Thirdly, the proposed direction fails to regulate how Prosegur will allocate work and does not require it to allocate work in a manner that ensures a proportionate and fair distribution of available hours amongst classes of employees. Finally, it submitted, Prosegur still has an apparent desire to allocate work to casual employees who do not have a reasonable expectation or entitlement to receive any particular number of minimum hours, at or over 50 hours per fortnight.
[18] It appears to us that the parties have, in substance, reached agreement about the following matters:
• it is necessary and appropriate that ordinary hours of full-time employees be reduced to a minimum of 60 per fortnight (although the TWU expressed this as 30 hours per week in its proposed direction);
• there is no need to make any jobkeeper enabling direction in respect of the part-time employees (who will, at least, receive the 24-hour weekly minimum provided for in clause 14.2.2.1 of the Agreement); and
• there is no need to make any jobkeeper enabling direction in respect of the casual employees.
[19] The parties appear also to agree that the direction made with respect to full-time employees should be conditioned by procedures for the allocation of additional available hours of work once particular minimum have been reached in relation to all three categories of employees. They disagree about what those procedures should be, but the extent of disagreement is relatively narrow. As we understand the TWU proposal, work would first be allocated to full-time employees, part-time employees and casual employees to ensure that they receive the minima of 30, 25 and 20 hours per week respectively (totalling 610 hours per week), and then any extra available work would, as far as reasonably possible, be allocated first to full-time employees (up to 38 hours per week), second to part-time employees (up to 30 hours per week) and third to casual employees. The Prosegur proposal would likewise give priority in the allocation of additional work to full-time employees so far as possible consistent with operational requirements, but the principal difference is that its minimum for casual employees is higher: it proposes 50 hours per fortnight (i.e. an average of 25 per week) instead of the TWU’s 20 hours. This would mean that additional work would be available for allocation after the minima totalling 665 hours per week have been met, as compared to the TWU’s 610 hours.
[20] Prosegur provided a spreadsheet of hours worked in each week falling in the period 20 April -10 July 2020. Using the rolling averages contained in that spreadsheet, there appears to sufficient hours available such that, once 665 weekly hours of work are allocated to meet Prosegur’s proposed minima, there are still sufficient hours of work left to allow full-time employees to receive approximately 38 hours per week (inclusive of any leave entitlements taken) if they are given priority in allocation (as both parties agree should occur) subject to operational requirements. In that sense, we consider that the Prosegur proposal is fair to employees, in that it would allow full-time employees to maintain approximately full-time pay, while retaining the minimum hours for part-time employees prescribed by the Agreement and a reasonable minimum for long-term regular casual employees. The Prosegur proposal, by providing for a minimum of 25 hours per week for casual employees, allows it to maximise the commercial benefit of the JobKeeper wage subsidies in respect of such employees and thus allows it to obtain what we consider to be a fair benefit out of the arrangement. The TWU proposal does not do this, and thus we consider less fairly balances the respective interests of the employer and the employees.
[21] Taking into account these considerations of fairness, we determine that Prosegur’s proposed direction should be adopted in resolution of the dispute. Although we have not preferred the TWU proposal, we consider that the modified direction now proposed by Prosegur substantially addresses the concerns which caused the TWU to initiate the dispute proceedings in this Commission in the first place and thus constitutes a fair and appropriate resolution of the dispute.
Orders
[22] Pursuant to s 789GV(4)(c) of the FW Act, we order as follows:
(1) the jobkeeper enabling direction issued by Prosegur to employees at its Moorooka depot on 9 June 2020, which took effect from 10 June 2020, is set aside effective from 27 July 2020; and
(2) in substitution thereof, the replacement jobkeeper enabling direction proposed by Prosegur filed on 18 July 2020 shall take effect on 27 June 2020 and remain in effect until 28 September 2020.
[23] These orders determine the dispute and, accordingly, this proceeding is concluded.
VICE PRESIDENT
Final written submissions:
Transport Workers’ Union of Australia Queensland Branch – 17 July 2020 and 20 July 2020.
Prosegur Australia Pty Ltd – 18 July 2020.
Printed by authority of the Commonwealth Government Printer
<PR721219>
2 Ibid at [38]