| [2020] FWCFB 4126 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.157 - FWC may vary etc. modern awards if necessary to achieve modern awards objective
Master Builders Australia Ltd; Housing Industry Association Limited; Australian Industry Group
(AM2020/28)
VICE PRESIDENT HATCHER |
SYDNEY, 6 AUGUST 2020 |
Application re the Building and Construction General On-Site Award 2010, the Joinery and Building Trades Award 2010 and the Mobile Crane Hiring Award 2010 – temporary variations – current circumstances of the COVID-19 outbreak – provisional views – matter stood overs
[1] Master Builders Australia Ltd (MBA), the Housing Industry Association Limited (HIA) and the Australian Industry Group (Ai Group) have applied, pursuant to s 158 of the Fair Work Act 2009 (FW Act) for a number of temporary variations to be made to the Building and Construction General On-Site Award 2010 (Building Award), the Joinery and Building Trades Award 2010 (Joinery Award) and the Mobile Crane Hiring Award 2010 (Mobile Crane Award) in response to the current circumstances of the COVID-19 outbreak. The draft determinations advanced by the applicants, reproduced in the annexure to this decision, seek to add a Schedule to each award that would operate only until 31 December 2020. A fundamental feature of the proposed variations is that they are only apply to those employers, and their employees, who are not entitled to access the Commonwealth Government’s JobKeeper scheme (non-eligible employers). The variations sought to the Building Award, as applicable to non-eligible employers, may be summarised as follows:
(1) An employer is authorised to give directions to reduce an employee’s days or hours of work, provided that the employee cannot usefully be employed for the employee’s normal days or hours during the period of reduced hours because of changes to business attributable to the COVID-19 pandemic or government initiatives to slow the transmission of COVID-19 (reduced hours directions power). An employee who is subject to such a direction is to be paid their normal rate of pay and have the award conditions applied to their actual hours worked, but is not entitled to be paid for any period of the employee’s normal days or hours not worked because of the direction to reduce days or hours.
(2) An employer is authorised to direct an employee to perform duties at a place that is different to the employee’s normal place of work (work location directions power). The location must be suitable for the employee’s duties and not require the employee to travel a distance that is unreasonable in the circumstances, and the performance of the employee’s duties must be safe and reasonably within the scope of the employer’s business operations.
(3) An employee will perform all duties that are within their skill and competency where necessary, regardless of their classification, provided that the duties are safe, and the employee is licensed and qualified to perform them (duties directions power).
(4) An Employer is authorised to require employees to take annual leave (provided an accrual of at least 2 weeks’ leave remains) or accrued rostered days off (RDOs) (leave and RDOs directions power).
(5) The powers to give directions are subject to a range of conditions including that there must be prior consultation, that the reasons for the direction arise from the circumstances of the COVID-19 pandemic, that the direction is in writing, that the direction is not unreasonable, that the direction is necessary to continue the employment of one or more employees of the employer, and that existing statutory protections concerning unfair dismissal, workplace rights and anti-discrimination apply. Any disputes about the issue of such directions are to be dealt with in accordance with the award dispute resolution procedure.
(6) An employee of a non-eligible employer will be entitled to up to two weeks’ unpaid leave if the employee is required by government or medical authorities or on the advice of a medical practitioner to self-isolate and consequently is prevented from working, or is otherwise prevented from working by measures taken by government or medical authorities in response to the COVID-19 pandemic.
(7) Instead of an employee taking paid annual leave on full pay, an employee and a non-eligible employer may agree to the employee taking twice as much leave on half pay.
(8) Where a non-eligible employer and employee agree, except as provided by clause 34 – Shiftwork, the ordinary hours of a full-time employee may be worked between 6.00am and 7.00pm Monday to Friday and 6.00am and 2.00pm on Saturdays.
(9) The redundancy definition in the industry-specific redundancy scheme in clause 17.2 of the award is to have no effect and would be replaced by that in s 389 of the FW Act. In addition, an employer may apply to the Commission to reduce the amount of redundancy pay payable under the scheme where the employer obtains other acceptable employment for the employee, or cannot pay the required amount.
(10) The minimum engagement period for a casual employee is to be reduced to two hours’ work per engagement, in addition to the relevant fares and travel allowance and expenses provided by clauses 24 and 25 for each day the employee is required to attend for work.
[2] The applicants propose that “mirror” variations be made to the Joinery Award and the Mobile Crane Award. A specific variation to the Joinery Award to reduce the minimum casual engagement to 2 hours is also sought.
[3] The applicants seek the exercise by the Commission of power under s 157(1)(a) of the FW Act, which provides:
(1) The FWC may:
(a) make a determination varying a modern award, otherwise than to vary modern award minimum wages or to vary a default fund term of the award; …
if the FWC is satisfied that making the determination or modern award is necessary to achieve the modern awards objective.
[4] The modern awards objective is set out in s 134(1) as follows:
(1) The FWC must ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions, taking into account:
(a) relative living standards and the needs of the low paid; and
(b) the need to encourage collective bargaining; and
(c) the need to promote social inclusion through increased workforce participation; and
(d) the need to promote flexible modern work practices and the efficient and productive performance of work; and
(da) the need to provide additional remuneration for:
(i) employees working overtime; or
(ii) employees working unsocial, irregular or unpredictable hours; or
(iii) employees working on weekends or public holidays; or
(iv) employees working shifts; and
(e) the principle of equal remuneration for work of equal or comparable value; and
(f) the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden; and
(g) the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards; and
(h) the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy.
[5] Although the applicants proceeded on the basis of a common claim, they advanced separate cases which tended to place somewhat different emphases on aspects of the claim and particular issues. The MBA, in summary, submitted that:
• the variations sought would allow the three awards to “better meet” the modern awards objective having regard to the COVID-19 pandemic and the current and future challenges it presents to the building and construction industry;
• building and construction services had been designated as “essential” by Governments, and had had to adopt a range of measures to continue to operate safely during the COVID-19 pandemic which had affected the way in which work is performed
• the pandemic and the associated uncertainty had caused a downturn in the industry, with a significant loss of jobs, a decline in the volume of construction work, and a fall in the value of approvals of commercial building work;
• there is a general concern about steep declines in forecast levels of future industry activity, manifested in a major reduction in forward orders;
• the worst-case scenario is a loss of jobs as high as 400,000 in an industry of about 1.2 million;
• there had been a high uptake of the Australian Government’s JobKeeper program, but this did not support the commercial sector, and the program was to cease at a time when the worst impacts on workplaces in the industry would make themselves felt, causing the industry to reach a “cliff”;
• the variations sought would allow building and construction workplaces to better manage the current and predicted challenges of the COVID-19 pandemic;
• social distancing requirements had affected the majority of building and construction workplaces, and some contractors had introduced shift splitting, additional site facilities and restrictions on the number of persons using lifts at any one time, and as a result productivity levels are reported to be down by about 60 percent of the usual rate;
• additionally, the COVID-19 pandemic had caused supply chain disruptions which had increased the cost of materials by up to 20 percent;
• the proposed award variations concerning the taking of annual leave and RDOs would give workplaces greater capacity to respond quickly to relevant circumstances as they arise, and would override existing inflexible provisions;
• the proposed provisions concerning the duties of employees were more flexible than the existing higher duties provisions in the awards;
• the power to make directions to reduce hours of work would allow for options to implement alternative working arrangements which do not currently exist in the awards;
• the power to alter working hours by agreement would provide more scope to accommodate disruptions to work arising from COVID-19 impacts, stagger ordinary hours of work to better accommodate WHS obligations in relation to social distancing and hygiene, accommodate other changes to workflow and future work programs, and allow greater capacity to take advantage of alterations announced by various local governments as to when construction activity may occur;
• the capacity to change work locations is necessary, as the awards do not currently contain any clear provision to facilitate this;
• the proposed reduction to the minimum engagement period for casual employees would promote greater opportunities to work, particularly in relation to the Joinery Award which requires casual employees to be engaged for a minimum of 7.6 hours;
• the redundancy variations would minimise the potential for businesses to be faced with significant financial ramifications in the form of redundancy liabilities where businesses are already frail, remove any incentive for employees to resign and receive redundancy payments if they receive a direction under the proposed variations, and would encourage parties to explore options that enable workers and employers to remain connected and with an ongoing relationship; and
• the current circumstances rendered the proposed variations necessary to form part of a fair and relevant safety net, in that they would assist building and construction workplaces to better accommodate the range of significant and adverse consequences arising from the pandemic, account for the future impacts arising from a range of worsening conditions and provide more options to minimise, limit or avoid these in the future.
[6] The MBA called two witnesses. Mr Shane Garrett, the MBA’s Chief Economist, gave evidence concerning the current and future economic impacts of the COVID-19 pandemic on the building and construction industry. Mr Tony Grippi, the Operations Manager, Sydney for Richard Crookes Constructions, gave evidence concerning the changes introduced to his employer’s operations as a result of the COVID-19 pandemic.
[7] The HIA’s submissions, while repeating many of the matters raised by the MBA, placed greater emphasis on the fact that the application, insofar as it sought to introduce the reduced hours directions power and the work location directions power, sought to reflect measures contained in the legislation which established the JobKeeper scheme.1 The HIA submitted that non-eligible employers should still benefit from the intention of the JobKeeper scheme to support employers to maintain a connection with their employees, enabling businesses to reactivate their operation quickly without having to rehire staff when the crisis is over, and these proposed provisions would also ensure “a level playing field across the industry”. The HIA also pointed to the application as seeking temporary award provisions which replicated provisions introduced in other awards in response to the pandemic in the Full Bench decisions of 28 March 2020 2 (First Clerks Award decision) and 8 April 20203 (April decision).
[8] Specifically, in respect of the residential building industry, the HIA submitted that home starts were predicted to drop significantly over the next year, with a forecast 43 percent year-on-year fall, leaving up to 500,000 jobs at risk. Longer term, the effect of the COVID-19 pandemic on immigration would significantly reduce Australian population growth, leading to a reduction in demand to 70,000 homes per year which could be satisfied by the completion of dwellings under construction. There had already been a fall in new home sales and a sharp increase in the cancellation of new home projects since the beginning of the pandemic. The HIA submitted that there was a lag in the way in which the industry responded to economic shocks, and businesses would be making staffing and other business decisions based upon a predicted significant downturn in activity. The HIA submitted:
“…Without any form of mitigation, this could result in extensive layoffs instead of a ‘bridge’ across this Pandemic, and a prolonged slump instead of a V-shaped recovery. Decisions need to be made today for when this fallout reaches on-the-ground activity. The risk of inaction is that another one of Australia’s key industries ends up in freefall, well after the health crisis is over.”
[9] The HIA’s submissions addressed the variations sought in the following way:
• the proposed variations for unpaid pandemic leave and the taking of annual leave at half pay would do no more than that which the Commission had determined to be necessary in other awards in the April decision;
• the provisions allowing for directions to take annual leave and accrued RDOs reflect what was inserted in the Clerks Private Sector Award 2010 in the First Clerks Award decision;
• the proposed hours of work provisions, including the reduced hours directions power, are necessary, firstly, to provide the flexibility to comply with COVID-19 health and hygiene requirements and allow for the safe scheduling of workers and, secondly, to allow employees to remain connected with their workplaces by allowing employers to engage workers for less or no hours;
• reducing the minimum engagement period for casual employees was a commonsense approach to ensuring the maintenance of their employment;
• the definition of redundancy in the industry-specific redundancy scheme in the Building Award was at odds with the general understanding of the term as provided for in the NES, and a facility to have the Commission reduce redundancy payments would ensure that employers covered by the Building Award are placed on a level playing field with other businesses across the country and are relieved of a potentially crippling cost burden.
[10] The HIA called two witnesses. Mr Warwick Temby, the Deputy Managing Director of the HIA, gave evidence concerning the “pipeline” for residential building work, employment in the residential building sector and the felt and anticipated effects of the COVID-19 pandemic. Ms Laura Regan, the Assistant Director – Industrial Relations of the HIA, gave evidence about member enquiries which the HIA had received since the beginning of the COVID-19 pandemic.
[11] In its submissions, the Ai Group referred to its internal data concerning the effects of the COVID-19 pandemic on the building and construction industry. It referred to the Ai Group/HIA Australian Performance of Construction Index, which it said rose by 3.3 points in May 2020 after reaching record lows in April 2020, with all activity and sector indices in the negative. Survey participants had reported, the Ai Group said, that new orders, new contract tendering opportunities and customer inquiries “had largely dried up”. The Ai Group also referred to its Australian Performance of Business Index, which lifted by 4.5 points to 31.8 points in May 2020, and is said to point to a further serious contraction in activity in May 2020 but at a slower pace than in April 2020’s record low (with any results below 50 points indicating deteriorating business conditions).
[12] The CFMMEU submitted that the Building Award, the Joinery Award and the Mobile Crane Award had not been included in the variations to a large number of awards affected by the April decision on the basis that the building and construction industry was not as adversely affected by the pandemic as other sectors and was unlikely to be affected in the short term. The industry had remained open since that time, there is a pipeline of government-funded work and stimulatory initiatives aimed at the industry had been announced which would generate work to be performed in the short to medium term. The CFMMEU submitted that the application was a “cynical and opportunistic attack on the safety net of building and construction workers” and is without merit. It submitted:
• the proposed variations were confined to those employers who were not eligible for the JobKeeper scheme, but there was no evidence about how many such employers there were or why they required the flexibilities to address issues arising from the pandemic;
• there was no regulatory gap left by the JobKeeper scheme, since its scope was the result of a deliberate policy choice by the Australian Government;
• unlike the JobKeeper scheme, the variations do not provide for any minimum payment to employees;
• the application was a “stalking horse” for long term changes to the safety net in the building and construction industry and an attempt to overturn the decision of the Commission in the 4 yearly review in relation to the Building Award and other industry awards;
• the low level of award reliance in the building and construction industry meant that the proposed variation to allow double the amount of annual leave to be taken at half pay would have little practical effect and was therefore not necessary;
• reliance on the First Clerks decision to justify the proposed capacity to direct the taking of annual leave was misplaced, since the variation in that matter was by consent, and the provisions were removed in the further decision concerning the Clerks – Private Sector Award 2020 issued on 9 July 2020 4 (Second Clerks Award decision);
• as to the power to direct the taking of RDOs, clause 33.1(c) of the Building Award from 1 July 2020 allows the employer to roster when RDOs are taken, making the proposed variation unnecessary;
• the variations concerning employee duties were unnecessary, since the necessary flexibility was already contained in the award classification descriptors;
• the necessity for the reduced hours directions power was not supported by any evidence, and constituted an attempt to “further casualise the industry and introduce what is essentially a zero hours contract”;
• there was no evidence to support the proposed change to ordinary hours, and there was no evidentiary basis for the contention that the change was necessary to allow the adoption of safe working practices in respect of the pandemic;
• because the Building Award already implicitly recognises that employers could require employees to work at different locations, the work location directions power was unnecessary;
• there was no evidentiary foundation for the proposed redundancy variations; and
• there was no evidence that any reduction in the minimum engagement requirements for casual employees were necessary to promote greater opportunities to work, and the proposed variations in this respect would have a significant impact on the most insecure workers in the industry.
[13] The CFMMEU also contended that the application was invalid because neither MBA nor the HIA were registered organisations and thus were not competent to make an application pursuant to s 158(1) of the FW Act for the Commission to exercise its award variation powers under s 157. It accepted that the Ai Group was a registered organisation competent to make an application pursuant to s 158(1), but contended that the application was not made in accordance with the Ai Group’s rules because there was no evidence that the signatory to the application had the requisite authority to do so. The CFMMEU also submitted that the proposed variations to the redundancy provisions in clause 17 of the Building Award were barred by s 141(4)(b) of the FW Act because they removed the industry-specific character of the redundancy scheme.
[14] The CFMMEU called evidence from Dr Phillip Toner of the Department of Political Economy at the University of Sydney, who prepared an expert’s report on the key structural characteristics of and recent trends in the building and construction industry (in conjunction with Associate Professor Michael Rafferty of the Department of Management at RMIT) and a supplementary report. The CFMMEU also filed witness statements made by Nigel Davies, the Assistant National Secretary of the CFMMEU’s Construction & General Division and Mr Jade Ingham, the Divisional Branch Assistant Secretary of the CFMMEU’s Construction & General Division, Queensland and Northern Territory Branch. Only Mr Davies was cross-examined.
[15] The AWU opposed the variations to the Building Award sought, particularly in relation to its area of coverage in the civil construction industry. It submitted that the applicants had not adduced evidence demonstrative of any need of the variations in the civil construction industry, and the AWU’s evidence showed that:
• work has continued in the civil construction industry throughout the pandemic with minimal disruption to normal working arrangements;
• the value of work to be done and yet to be done in March 2020 has significantly increased;
• Federal and State Governments have targeted the civil construction industry as a target for economic stimulus, and accordingly the industry will experience a substantial increase in publicly funded work for a number of years; and
• the civil construction industry is not an industry that has been severely impacted by the COVID-19 pandemic.
[16] The AWU also filed witness statements made by the following persons:
• Nicholas Kamper, the AWU’s National Economist;
• Stephen Crawford, the AWU’s Senior National Legal Officer;
• Anthony Callinan, Assistant Secretary of the AWU’s NSW Branch;
• Ronnie Hayden, Lead Organiser in the AWU’s Victorian Branch;
• Paul Cradden, Civil Construction Organiser in the AWU’s Queensland Branch;
• Andrew Duffy, Construction, Oil and Gas Organiser in the AWU’s West Australian Branch; and
• Paul Henderson, President and Organiser in the AWU’s South Australian Branch.
[17] None of the above was required for cross-examination by any party.
[18] The submissions of the AMWU and the CEPU largely raised the same matters as those dealt with in the submissions of the CFMMEU and the AWU. The CEPU’s submissions focused on the lift/escalator installation and maintenance industry, which it said had initially been impacted by the pandemic due to limited access to buildings and shopping centres. It submitted that this had been dealt with by measures such as working four days a week by using annual leave and training, and consequently the pandemic had a minimal impact on the industry.
[19] Because it is a fundamental feature of the application before us that the award applications are only to apply to employers who are not participants in the JobKeeper scheme, it is necessary to consider how the scheme has operated and might operate in the future in the building and construction industry. The JobKeeper scheme was established as an emergency measure by the Commonwealth Government shortly after the commencement of the pandemic in Australia, and in its original form operates until 28 September 2020. The scheme pays wage subsidies to eligible employers of $1,500 per fortnight on the basis that they will retain all eligible employees in employment and pay them the greater of $1,500 per fortnight or the amount payable to employees for the hours actually worked in the relevant fortnight. To be eligible, an employer must suffer a decline in turnover for a month or quarter during the currency of the scheme compared to a similar period in 2019. The threshold rates of decline are, relevantly, 30 percent for businesses with an annual turnover of $1 billion or less, and 50 percent for businesses with an annual turnover of more than $1 billion. Temporary changes to the FW Act were legislated as part of the scheme. These changes were summarised in the Full Bench decision in Qantas Airways Limited v Mazzitelli 5 as follows:
“[2] The Coronavirus Economic Response Package Omnibus (Measures No. 2) Act 2020 amended the FW Act by introducing a new Part 6-4C, Coronavirus economic response. Section 789GB provides that the object of the Part is, in summary, to make temporary changes to assist the Australian people to keep their jobs and maintain their connection to their employers, during the “unprecedented economic downturn and work restrictions arising from: (i) the COVID-19 pandemic; and (ii) government initiatives to slow the transmission of COVID-19”; to help sustain the viability of Australian businesses; to continue the employment of employees; to ensure the continued operation of health and safety laws during the pandemic; and to help ensure, where reasonably possible, that employees remain productively employed during the pandemic and continue to contribute to the business of their employer where it is safe and possible for the business to continue operating.
[3] The Part allows qualifying employers to give directions to employees and make certain requests of them. The “jobkeeper enabling directions” which the Part empowers qualifying employers to make fall into three categories:
• a “jobkeeper enabling stand down” under s 789GDC, by which an employee may be required not to work on a day they would usually work, work for a lesser period on a day, or work a reduced number of hours overall (which can be nil);
• a direction under s 789GE that an employee perform other duties that are within the employee’s skill and competency and are reasonably within the scope of the employer’s business operations; and
• a direction under s 789GF that the employee work at a different place, including the employee’s home, provided that it is suitable for the employee’s duties and does not require the employee to travel an unreasonable distance.
[4] The making of the directions are subject to requirements relating to reasonableness (s 789GK), necessity for the continuation of the employee’s employment (s 789GL), prior notice and consultation (s 789GM), form (s 789GN) and duration (s 789GP). A jobkeeper enabling direction must be complied with by the employee to whom it is directed (s 789GQ).
[5] The requests an employer may make, which must be considered and may not unreasonably be refused by the employee, are:
• a request under s 789GG for the employee to work on days or at times that are different from the employee’s ordinary days or times, but which do not reduce the employee’s number of hours of work (compared with the employee’s ordinary hours); and
• a request under s 789GJ(1) that an employee take paid annual leave, provided the request does not result in the employee having a balance of fewer than two weeks. An employer and employee can also agree to the employee taking twice as much paid annual leave at half pay (s 789GJ(2)).
[6] In order to be authorised under Part 6-4C to make any of the directions or requests referred to, an employer must be a national system employer which qualifies for the jobkeeper scheme and is entitled to a jobkeeper payment in respect of the employee the subject of any such direction or request. The JobKeeper Payment Scheme is a temporary subsidy enacted by the Commonwealth for businesses significantly affected by the COVID-19 pandemic under which such business can apply to receive $1,500 per eligible employee per fortnight to assist them retain employees in employment. Section 789GC provides that qualification for the jobkeeper scheme and entitlement to a jobkeeper payment are as determined by the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 (Jobkeeper Payment Rules).”
. . .
[10] In addition to s 789GD, s 789GDA requires that, where a jobkeeper payment is payable to an employer for an employee for a fortnight, the employer must ensure that the total amount payable to the employee in respect of the fortnight is not less than the greater of the amount of the jobkeeper payment payable to the employer for the fortnight (i.e. $1,500) or the amounts payable to the employee in relation to the performance of work during the fortnight.”
[20] Section 789GV of the FW Act empowers the Commission to deal with disputes about the operation of Pt 6-4C, including by arbitration (s 789GV(2)). Under s 789GV(4), the Commission may make orders that are desirable to give effect to a jobkeeper enabling direction, to set aside such a direction, or to substitute a different direction, and may make any other orders that the Commission considers appropriate. In the Full Bench decision in TWU v Prosegur Australia Pty Ltd, 6 the Commission’s dispute resolution powers under s 789GV(4) were described as follows:
“[36] …we consider that the Commission is invested with a broad discretion which is constrained only by: (1) the need to have regard to the object of Part 6-4C in s 789GB; (2) the achievement of the purpose of s 789GV to deal with and resolve the dispute at hand; and (3) the requirement in s 789GV(7) to take into account fairness between the parties concerned.”
[21] The applicants adduced no evidence concerning the extent of employer participation in the JobKeeper program, nor were they able to provide any useful information about this. The applicants do not appear to have surveyed their members about this, notwithstanding that their application proposed variations which are to apply only to non-eligible employers. The CFMMEU drew our attention to a report entitled “The JobKeeper Payment: Three-month review June 2020” published by the Commonwealth Treasury on 21 July 2020. It relevantly discloses that the construction industry had the largest number of JobKeeper applications (about 130,000 processed in April 2020). These constituted over 30 percent of business organisations in the industry, but a significant proportion of these are sole-traders. There were about 348,000 employee recipients of JobKeeper benefits in the construction industry, constituting approximately 30 percent of private sector employment in the industry. This data suggests that, at least until the JobKeeper scheme in its current form ends on 28 September 2020, roughly two-thirds or more of employers and employees in the industry would be affected by the applicants’ variations.
[22] As already stated, the applications seek award variations which would operate until 31 December 2020, beyond the current end date of the JobKeeper scheme. At the time of the hearing, it was unknown whether the scheme would be extended by the Commonwealth Government, and part of the applicants’ case was that the variations would be needed for those employers currently participating in the scheme in the event that there was no extension. However, on 21 July 2020, the Commonwealth Government announced that the JobKeeper scheme would be extended, in a modified form, until 28 March 2021. The main features of the modified scheme that have been announced are, relevantly, as follows:
• the payment rate for eligible employees will be reduced to $1,200 per fortnight from 28 September 2020 and to $1,000 per fortnight from 4 January 2021, and lower payment rates of $750 per fortnight and $650 per fortnight respectively will apply to employees that worked fewer than 20 hours per week;
• to be eligible for the scheme, business will need to demonstrate eligibility by reference to their actual GST turnover in the June and September quarters 2020 and, from 4 January 2020, by reference to the June, September and December 2020 quarters; and
• the same thresholds for reductions in turnover will apply.
[23] As at the date of this decision, there has been some public discussion about the possibility that the industrial relations changes effected by Part 6-4C of the FW Act might continue after 28 September 2020, including in relation to employers that cease to be eligible for the JobKeeper Scheme as a result of the modifications identified above, but there have been to date no legislative developments in this connection.
[24] No part of the building and construction industry has been required to close as a preventative measure during the pandemic, and only a very small number of sites have had to temporarily close for industrial cleaning due to a spike in cases. The evidence before us demonstrates that the industry has responded impressively to the crisis and has incorporated hygiene and distancing measures into work practices with only limited disruption to scheduled work. In relation to large-scale commercial construction work, Mr Davies gave evidence that in Victoria, Master Builders Victoria, other employer organisations and the CFMMEU had formed a working party to develop guidelines for the safe continued operation of the industry during the pandemic. These guidelines address issues of screening of workers entering a site, on-site hygiene and social distancing measures, and set out processes to be followed in the event of a confirmed COVID-19 case on a site. The suggested practical measures that might be taken include:
• staggered meal times to limit shared use of amenities;
• sanitation of amenities between use by different groups;
• the separation of work groups in order to limit the number of people accessing an area at any one time;
• establishment of additional amenities on several levels at multi-storey sites to limit the need to use lifts to access amenities;
• the limitation of numbers of persons using lifts at any one time; and
• the use of staggered start times so that workers do not have to queue to use lifts.
[25] Mr Davies’ evidence was that these measures, where taken, had not, as far as he was aware, affected productivity except perhaps on high-rise projects. However, there is some evidence that these measures have affected productivity. Mr Grippi described how Richard Crookes Constructions had developed COVID-19 response plans. The measures taken include the splitting of work to allow the staggering of work to reduce the numbers of workers on site at any one time, and staggering breaks to ensure that lunchrooms and site sheds are not overcrowded. Mr Grippi’s evidence was that these measures had caused some disruption to workflows and slowed down progress, meaning that some tasks that would ordinarily have been undertaken over the course of a usual working day are having to be completed outside of working hours. He also said that the engagement of full-time cleaners in order to implement a rigorous cleaning regime on its sites had also caused significant disruptions to workflow as a result of site sheds and lunchrooms having to be cleaned between shifts. Limitations on the number of workers that can be transported in lifts had also pushed up costs incurred by subcontractors due, in some cases, to them having to pay overtime or penalty rates to their employees so that they can complete their work without causing disruptions to other trades on the job.
[26] In the civil construction sector, the evidence showed that a range of similar controls have been put into place, including:
• staggered start time and meal breaks;
• reduction in shift lengths to avoid congestion in change rooms;
• area-specific tool-box talks and pre-start meetings;
• additional cleaners on each shift;
• hand sanitiser stations around sites;
• positive social distancing messaging; and
• additional lunch sheds to reduce contact in breaks.
[27] On the evidence before us, work has otherwise continued largely as normal in the civil construction sector. The nature of the work on civil construction projects naturally allows for greater social distancing.
[28] There was very little evidence about the effect of the pandemic on the conduct of work in the residential sector. Mr Temby gave evidence that “...home building work in the pipeline has been permitted to continue in the COVID-19 environment but with restrictions on safe distancing and hygiene that have lowered productivity”, but he did not explain the basis for this proposition. Particularly on small-scale residential work, which only involves small numbers of workers on a site at a given time, it is not evident how precautionary measures taken would significantly affect productivity.
[29] As earlier stated, the case advanced by the applicants was that, in the period until the end of 2020, the construction industry will be facing unusually difficult circumstances involving a significant reduction in work and consequent employment losses as a result of the COVID-19 pandemic - circumstances which, the applicants contended, were well outside the normal cycle of peaks and toughs in the industry - and that the award changes it sought were necessary to permit employers not participating in the JobKeeper scheme to cope with these circumstances and to minimise the loss of employment. The consideration of the applicants’ case in this respect therefore requires an assessment of the commercial circumstances likely to face the construction industry from now until 31 December 2020. It does not require any longer term assessment, since the application is brought on the basis that the award changes sought are necessary short-term emergency measures and not on the basis that they are necessary in the longer term.
[30] It is apparent that there has been a loss of employment in the building and construction industry since the commencement of the COVID-19 pandemic, but the extent of this loss in employment is somewhat unclear. Mr Garrett referred to May 2020 ABS Payroll data 7 which indicated that total construction employment across Australia dropped by 5.8% amongst businesses that are Single Touch Payroll-enabled. On the basis that total construction employment was estimated at 1,184,184 in February 2020, Mr Garrett said that this implied that there had been around 69,513 construction jobs lost between 14 March 2020 and 30 May 2020. However, Dr Toner pointed to the ABS Annual Labour Force data8 as indicating a different picture. This data set shows that the total number of jobs in the construction sector fell from 1,182,100 in February 2020 to 1,179,600 in May 2020 – a decrease of only 2,500 (with the drop being a little greater in seasonally adjusted terms). The ABS states that the payroll data includes only paid employee jobs, whereas the labour force data includes owner managers of incorporated and unincorporated enterprises (i.e. self-employed workers) as well as workers who are on paid leave or have been stood down,9 but this is unlikely to explain the difference in the numbers. Dr Toner also pointed to more recent ABS Payroll data as demonstrating a reversal of the loss of jobs. The most recent ABS Payroll data shows there has been growth in jobs in the construction industry in June 2020, with the result that, between 14 March and 27 June 2020, the total reduction in jobs had dropped to 3.9%. This is near the bottom end of the range in terms of job losses in each industry sector during the COVID-19 pandemic.
[31] It is perhaps more useful to assess the industry by reference to three subsectors: civil/ engineering construction, commercial/large-scale residential construction and small-scale residential construction. In respect of the first subsector, which is primarily comprised of civil infrastructure work, the AWU adduced extensive evidence, which was not contradicted, showing that the COVID-19 pandemic has had little if any effect upon the level of work and employment, with that position being unlikely to change (and perhaps to improve) in the near future. Mr Kramper referred in his evidence to ABS data concerning engineering construction activity published on 1 July 2020 10 which showed that, in respect of civil infrastructure work, the value of work commenced in the March 2020 quarter was $20.6 billion, a 42 percent increase from the previous quarter, and the value of work yet to be done in the March 2020 quarter was $71.84 billion, the highest quarterly figure since September 2015 and 12.5 percent above the 5-year average of $64 billion. In their witness statements, Mr Crawford, Mr Callinan and Mr Hayden identified a significant number of public announcements made since the pandemic commenced of Federal and State government-funded civil infrastructure projects that are new or have been brought forward. Mr Callinan, Mr Hayden, Mr Cradden, Mr Duffy and Mr Henderson gave evidence in their witness statements that civil infrastructure projects on which AWU members were employed were proceeding largely as normal in New South Wales, Victoria, Queensland, Western Australia and South Australia respectively, notwithstanding that some adjustments to work processes had been made to minimise the risk of the spread of infection. Mr Garrett gave evidence that private sector-financed civil construction projects “are likely to struggle due to the deterioration in the economic environment ... particularly in the sectors of the economy most hurt by Covid-related restrictions”, but he offered no data to support this opinion. He accepted that a major program of government-backed infrastructure was already ramping up before the pandemic, and that this plus any additional stimulus had the potential to offset “some of the declines” in private sector projects.
[32] In relation to the commercial/large scale residential construction sector, Mr Garrett expressed the opinion that subsectors of commercial building like offices, accommodation, transport buildings, entertainment, recreation and some retail were likely to face considerable reductions in activity over the short term as a result of COVID-19, but there was potential for government-dependent areas of commercial building to perform well as a result of stimulus. Mr Garrett referred to a survey which MBA conducted of its members between 8 and 15 April 2020 which indicated that 73.7 percent of the 798 respondents had suffered a loss of forward work on their books since the start of the pandemic, and 41.5 percent had experienced a decline of at least 30 percent in the amount of their forward work. On this basis, Mr Garrett expressed the view that as existing works reached completion, the impact of deteriorating conditions would become more apparent over the next 3-6 months. Mr Garrett’s analysis largely reflected MBA’s updated industry forecasts published in April 2020. The overview in these forecasts stated, in respect of commercial construction:
“…Before the Covid-19 crisis broke, commercial building activity was at a record high and the set of forecasts released in February envisaged that activity would fall back over the next few years.
The commercial building landscape is changed hugely by the crisis: private sector-led projects are likely to suffer due to the very uncertain economic backdrop. In particular, activities like tourism, recreation and entertainment have particularly poor prospects given the combination of enforced closures, restrictions on travel as well as the reduced willingness of large numbers of consumers to engage in non-essential expenditure.
On the other hand, the public sector dominates important areas of commercial building like health and education and the short term prospects for these are much improved given that government stimulus is likely to be heavy here.
The updated forecasts for commercial building are shown below. Overall, the huge reverses in private sector investment will outweigh the possible expansions in government driven projects and the commercial building volumes are likely to be quite depressed over the three-year period between 2020/21 and 2022/23…”
[33] Mr Grippi did not give any evidence of any actual or forecast loss of work on the part of Richard Crookes Constructions.
[34] For the CFMMEU, Mr Davies gave evidence that, at least in his experience in Victoria, the designation of the construction industry by governments as “essential” had meant that the industry had continued to operate with limited interruption, and he was not aware of any major contractors or sub-contractors undertaking wide-scale redundancies. Mr Ingham said in his witness statement that Queensland was already at the bottom of the construction activity economic cycle prior to the commencement of the pandemic, and that apart from investor stock units, commercial construction was either steady or on the way up. He also pointed to the support the commercial sector would receive from the Queensland Government’s “Unite and Recover for Queensland Jobs” package, the first stage of which was announced in May 2020. We note that the evidence of Mr Davies and Mr Ingham was concerned only with what they called the “regulated” sector of the industry, which we understand to mean that part of the industry which operates under CFMMEU-negotiated enterprise agreements or arrangements.
[35] In relation to the small-scale residential sector, the evidence of Mr Garrett indicates that the sector was already facing a decline in work before the commencement of the pandemic. New home building starts totalled 41,612 during the December 2019 quarter, which was 32.7 percent lower than during the peak of the cycle in early 2018. MBA’s forecasts in late April 2020 were that the COVID-19 pandemic would reduce new home building starts to a low of 115,822 in the 2020-2021 financial year, which would be 35,950 less than for 2019-2020 and would be the weakest year for new home building in two decades. The HIA’s May 2020 industry forecast similarly predicted 110,000 housing starts in 2020-2021, a 43 percent drop, with dwelling starts declining by 13 percent in the June 2020 quarter, 15 percent in the September 2020 quarter and 9 percent in the December 2020 quarter. The HIA also pointed to its own data from its monthly New Home Sales report for May 2020, which was released on 12 June 2020. The HIA’s New Home Sales reports are prepared on the basis of the HIA’s survey of the largest 100 home builders in Australia, which account for 33 percent of all houses built in Australia, on their sales (contract to build) for the previous month. The results of the survey are used to extrapolate results for the rest of the market including a seasonal adjustment. The HIA’s May 2020 report showed that:
• new home sales were 4.2 percent lower in May 2020 compared to April 2020;
• new home sales fell by 20.3 percent in the last three months compared to the previous three months; and
• cancellations of new home projects over the last three months had increased sharply.
[36] However, since publication of the forecasts and data by the MBA and the HIA, the Australian Government’s HomeBuilder stimulus program has come into effect. In brief, the HomeBuilder scheme is a time-limited grant program to help the residential construction market to bounce back from the COVID-19 pandemic. The scheme provides eligible owner-occupiers (including first home buyers) with a grant of $25,000 to build a new home or substantially renovate an existing home where the contract is signed between 4 June 2020 and 31 December 2020, provided that construction must commence within three months of the contract date.
[37] The HomeBuilder scheme, on the evidence before us, appears to have produced a remarkable turnaround in the fortunes of the small-scale residential sector. The CFMMEU placed into evidence a copy of an article published in the Australian newspaper on 15 July 2020 which was headlined “HomeBuilder package ‘most effective stimulus in a decade’”. The article relevantly stated:
“The take-up rate of the federal government's $688m HomeBuilder program could underwrite up to half all new expected dwellings in the housing market over six months, with the building industry saying some regions were recording highest activity levels in a decade.
The projections come as the housing sector on Monday recorded a 77 per cent jump in new home sales for June, the same month the scheme launched offering $25,000 grants for people to build new homes or substantially renovate.
The Master Builders Association has reported that in the past four weeks, activity in the sector had returned to pre-COVID-19 levels, saying the package had delivered the ‘most effective stimulus in decades’.
The Housing Industry Association said on Monday that without government intervention, the contraction could have cost up to half a million jobs in the second half of 2020.
The Australian understands almost 40,000 people have registered for HomeBuilder grants since the scheme was launched by Assistant Treasurer Michael Sukkar on June 4.
Treasury modelling originally forecast the program would support 21,000 new home builds and 7000 renovations or ‘rebuilds’.
While not all registrations will translate into approvals, Treasury expects the original forecasts to be significantly exceeded
The economic shutdown had threatened to slash new home builds from the average 175,000 a year to as low as 100,000 because of the COVID-19 shutdown.
Master Builders Association chief executive Denita Wawn told The Australian: ‘Just today I been told by industry veterans who head some of the largest home building businesses in the country that this is the most effective government stimulus that they have seen in decades in the industry.
‘Reports from members are backing this up on daily basis.
‘Builders (who) have been doing it tough for years say they have had the best month in terms of sales since the GFC…’
. . .
Mr Sukkar said the latest HIA data showed HomeBuilder was doing ‘exactly what it was intended to do – generate immediate construction activity that will engage tradies straight away’.
‘HomeBuilder is about encouraging those who may have pulled back from undertaking a new build or substantial rebuild in March when the pandemic hit,’ he said.
The head of one of the county's largest construction companies, ABN Group chief executive Dale Alcock, said it had dragged Western Australia out of a five-year slump with an immediate pick-up in activity. ‘There has been frantic activity ... anyone who qualifies has come out of the woodwork,’ he said. ‘It's been an amazing response. This is one of those industries that rides a rollercoaster ... we were coming off a very low base. But the response has been a bit overwhelming ... it's a great problem to have.
‘We are waiting to see four weeks on if we are going to see a moderation of inquiries.’
The HIA said there needed to be several more months of data to demonstrate whether the pick-up would be sustained.
. . .
HIA chief economist Tim Reardon said the rebound in new home sales in June did not fully offset the dismal results of the preceding three months and ‘we are cautious of over-interpreting data from a single month’.
‘Additional sales data from July and August will be necessary before drawing accurate estimates on the impact of HomeBuilder on employment in the sector,’ he said.
[38] The MBA and the HIA both accepted that the article was accurate insofar as it quoted or reported statements made by its officials, and that those statements reflected the positions held by the organisations at the time the article was published.
[39] At our request, the HIA produced the “latest HIA data” referred to in the article. This turned out to be the HIA’s New Home Sales report for June 2020. In summary, the report stated or showed that:
• new home sales in June 2020 recorded their first monthly increase since COVID-19 restrictions were introduced in March 2020 and the highest monthly increase in nearly a decade;
• new home sales were 77.6 percent higher in June 2020 as compared to May 2020;
• Australia-wide, total new home sales for the three months to June 2020 were 2.6 percent higher than for the preceding three months, and 0.9% higher than for the same three months of the preceding year;
• there were significant differences between the states, with Western Australia recording very large increases in housing starts and South Australia being the worst performing state;
• the dramatic monthly increase was due to the HomeBuilder scheme and various state incentives for building, leading to an improvement in consumer confidence;
• COVID-19 restrictions caused new home sales to plummet to their lowest level in March 2020 and to continue to fall in April and May 2020;
• without government intervention, the March-May 2020 results indicate that a significant contraction in the volume of work on the ground would have occurred in the second half of 2020;
• the cancellation rate has reduced from over 30 percent in April 2020 to 23 percent, but this is still higher than the typical cancellation rate of 7 percent;
• the rebound in new home sales in June 2020 did not fully offset the dismal results for the preceding three months, and further data for July and August 2020 is necessary to draw an accurate estimate of the impact of the HomeBuilder scheme on the sector, but the June results are a good indication that the HomeBuilder scheme is working.
[40] The conclusions we reach on the basis of the above are as follows:
(1) There has been a loss of employment in the construction industry as a whole since the commencement of the COVID-19 pandemic, but this has been less serious than in most other industry sectors and there has been some recovery in employment since the beginning of June 2020.
(2) The civil/engineering construction sector has been little affected by the pandemic. There is a current pipeline of large, long-term infrastructure projects which are continuing, and governments are bringing forward or announcing further infrastructure projects.
(3) The pandemic has not yet had a significant effect on the commercial/large-scale residential sector, since projects underway before the pandemic are continuing. However, there has been a loss of forward private sector work which means that, as existing projects are completed, there is likely to be a loss of work and activity in this area. This may begin to manifest itself before the end of the year. This is likely to be partially offset by new government stimulus work.
(4) The small-scale residential sector was initially the area of the construction industry most affected by the pandemic. However, the initial evidence is that the HomeBuilder scheme has sparked a very strong recovery in the sector and is likely to provide strong support to activity in the sector through to the end of the year.
Competency of the application
[41] It may be accepted, as contended by the CFMMEU, that MBA and the HIA are not competent to make the application. They are not registered organisations, nor are they employers covered by the Building Award, the Joinery Award or the Mobile Crane Award, and accordingly they cannot make an application to vary any of those modern awards pursuant to s 157(1) of the FW Act. They did not identify any alternative source of power to make the applications. However, the Ai Group, being a registered organisation, is a competent applicant. In the absence of evidence to the contrary, we presume that the application was validly made in accordance with the Ai Group’s rules. Accordingly, there is a competent application before us.
Variations applicable only to non-eligible employers
[42] The fundamental feature of the application which requires initial consideration is that the award variations proposed are to apply only to non-eligible employers. This requires some initial consideration before turning to the variations sought. As earlier stated, the applicants’ case in this respect has two aspects:
(1) To assist employers who are currently not eligible for the JobKeeper scheme to continue operating and employing persons in the current difficult circumstances of the pandemic.
(2) To serve as a “safety net” if the JobKeeper scheme is not continued after the current version of the scheme ends on 28 September 2020.
[43] The second aspect of the applicants’ case has been overtaken by events in that, on 21 July 2020, the Commonwealth Government announced that a modified version of the JobKeeper scheme would continue until 28 March 2020, well past the end-date of the applicants’ proposed variations. That makes the second aspect of the applicants’ case largely redundant, although we acknowledge that the new eligibility rules are stricter and are likely to lead to some currently eligible employers falling out of the scheme.
[44] As to the first aspect of the applicants’ case, we consider that it is fundamentally misconceived. The Commonwealth Government has, in establishing and legislating for the JobKeeper scheme, designed a policy which it considers to be an appropriate response to the COVID-19 pandemic. The criteria for eligibility for the JobKeeper scheme have been determined as part of that policy. In order to give full effect to the policy, Part 6-4C has been added to the FW Act which, among other things, empowers employers to give certain types of directions to employees which override inconsistent provisions in modern awards, enterprise agreements and contracts of employment. We do not consider that the Commission’s modern award variation powers are, in those circumstances, to be exercised for the purpose of expanding the scope of application of certain aspects of the JobKeeper scheme to those who are not eligible to access it. That would amount to the Commission engaging in the exercise of re-designing the policy response to the pandemic considered appropriate by the Commonwealth Government. We do not consider it the proper role of the Commission, nor is it necessary to achieve the modern awards objective, to “level the playing field” such as to counteract deliberate policy choices made by the Commonwealth Government.
[45] Moreover, the applicants do not seek the replication of the entirety of the JobKeeper scheme for non-eligible employers, but instead to “cherry-pick” elements of the scheme which operate to the benefit of non-eligible employers while disregarding those elements which protect the security of employment of employees and support employees’ incomes. The elementary equation in the JobKeeper scheme is that employees receive a guarantee of continuing employment and a minimum income, while employers are empowered to direct that employees work less or no hours, perform other duties, or work at different locations. The application seeks to replicate the latter elements but not the former. Indeed, far from providing job security for employees, the applicants propose variations to the redundancy provisions of the three awards in order to modify (to the detriment of affected employees) employer obligations upon termination of employment. This is fundamentally imbalanced in terms of fairness and contradicts the social compact inherent in the JobKeeper scheme. Further imbalance is created by the fact that, for participants in the JobKeeper scheme, s 789GV of the FW Act empowers the Commission to arbitrate disputes about jobkeeper enabling directions and, if it considers appropriate, to set aside such directions and replace them with alternative directions. The applicants’ proposed variations contemplate that a dispute about a direction issued by an employer pursuant to the proposed directions powers could be agitated under the award dispute resolution procedure, but by virtue of s 595 of the FW Act the Commission does not have the power to arbitrate such disputes unless there is consent for it to do so.
[46] We have earlier stated our findings concerning the economic effects of the pandemic on the building and construction industry. The building and construction industry has been one of the least affected industry sectors, and substantial government support will sustain activity in the sector until the end of the year and beyond. There may well be longer term effects of the pandemic on the “pipeline” of working in coming years, but this goes beyond the temporal scope of the application before us. Because the application is directed to employers who are not eligible for the JobKeeper scheme, it is necessarily intended to benefit employers who have suffered the least reduction in turnover or may not have suffered any reduction in turnover at all. The only employer witness, Mr Grippi, did not give evidence that Richard Crookes Constructions had suffered any loss of turnover because of the pandemic or was likely to before the end of the year, nor did he suggest that the business had made or was likely to make anyone redundant. To the extent therefore that the application is intended to preserve employment in the current economic climate, their evidence does not persuade us that it is required or would achieve that purpose.
[47] We do not consider that it is necessary, in order to meet the modern awards objective, to make any variation to the awards that apply only to non-eligible employers.
Reduced hours directions power
[48] We reiterate that under the JobKeeper scheme, the power to make directions reducing employee hours is balanced by requirements to retain employees in employment and pay them the minimum prescribed income. The applicants’ proposed reduced hours directions power would permit hours to be reduced, including to zero hours, and for the employee to suffer a concomitant loss of income, without there being any requirement for the employee ultimately to be retained in employment. This does not represent a fair adjustment to the award safety net. Further, the evidence did not satisfy us that such a measure would serve to preserve the employment of employees engaged by any non-eligible employers, nor is it necessary to preserve the viability of any non-eligible employers’ businesses. This variation is not necessary to achieve the modern awards objective and is rejected.
Work location directions power
[49] This proposed variation is unnecessary to meet the modern awards objective. Travel to different construction sites as determined by the employer, including to distant work sites, is an established feature of the building and construction industry and express provision for this is already made in clauses 24 and 25 of the Building Award. Clause 25.1(a) in particular, refers to the “travel patterns and costs peculiar to the industry, which include mobility in employment and the nature of employment on construction work...”. Equivalent provisions may be found in clause 14.3(c) and (e) of the Mobile Crane Award and clause 24.5 of the Joinery Award.
Duties directions power
[50] This proposed provision is also unnecessary to meet the modern awards objective because the awards already provide for a high degree of flexibility as to the performance of duties by employees. For example, the classification definition of CW/ECW1 in Schedule B of the Building Award provides that an employee at this level “performs work to the extent of their skills, competence and training” and “may be required to perform a range of duties across the skill streams contained within this award”. The other classifications have similar requirements for employees to perform work to the extent of their skills, competence and training. Clause 30, Higher Duties, allows for employees to perform work carrying a higher rate of pay than their normal classification. The classification definitions in Schedule B the Joinery Award provide for an equivalent level of flexibility as to the range of duties that may be required to be performed. The classifications in the Mobile Crane Award involve much more specific job functions such as to make flexibility in duties a far less relevant consideration. There was no evidence that the awards imposed any practical inhibition on the capacity of employers to require employees to perform duties for which they have the relevant training and capacity.
Leave and RDOs directions power
[51] We do not consider that the FW Act permits an award provision that would require an employee to take annual leave at times directed by the employer. The taking of the NES entitlement to annual leave is dealt with in s 88 of the FW Act as follows:
(1) Paid annual leave may be taken for a period agreed between an employee and his or her employer.
(2) The employer must not unreasonably refuse to agree to a request by the employee to take paid annual leave.
[52] An award provision which requires an employee to take their annual leave entitlement during a period determined by the employer would be inconsistent with and exclude the right of the employee under s 88(1) to take their annual leave for a period to which they agree. Section 55(1) of the FW Act requires, relevantly, that a modern award must not exclude any provision of the National Employment Standards.
[53] The applicants submitted that the provision which they seek is the same as that awarded in the First Clerks Award Decision. However, that provision was included by consent, and it was replaced in the Second Clerks Award Decision by a provision which, in summary, required an employee to not unreasonably refuse agreement to an employer request to take annual leave at a specified time.
[54] In respect of the proposed provision permitting employers to require the taking of accrued RDOS, we do not consider that this provision is necessary to achieve the modern awards objective. Clause 33, Hours of Employment, of the Building Award was substantially modified as a result of the 4 yearly review of the award to remove impediments to flexibility in the rostering of hours. 11 This occurred in response to claims advanced by the MBA and the HIA. The provision concerning the taking of RDOs was one of the modified provisions. Clause 33.1(c)(i) of the Building Award now relevantly provides:
(c) Taking the accrued RDO
(i) An accrued RDO will be taken in one of the following ways:
• on one day during a 20 day four week cycle on which all employees will take a RDO in accordance with a written roster fixed by the employer and issued 7 days before the commencement of that cycle; or
• on a day during a 20 day four week cycle during which particular employees will take their RDOs on different days in accordance with a written roster fixed by the employer and issued 7 days before the commencement of that cycle; or
• by any other method that is agreed by the employer and a majority of that employer’s employees and recorded in writing.
[55] Clause 33.1(d) allows for the banking of RDOs that would otherwise be taken under one of the ways fixed under clause 33.1(c)(i), but the employer must agree to this.
[56] The new provisions only came into effect on 1 July 2020. There is, unsurprisingly, no evidence that the new provisions are not achieving the modern awards objective. They give considerable control to the employer as to when RDOs are taken. We do not consider that any proper basis has been demonstrated to modify these provisions. There was no evidence suggesting that the existing provisions concerning RDOS in the Mobile Crane Award or the Joinery Award were not meeting the modern awards objective.
Unpaid pandemic leave and double annual leave at half pay
[57] For the reasons already given, we do not consider that the proposed provisions for unpaid pandemic leave and the taking of double annual leave at half pay should be awarded on the basis that they apply only to non-eligible employers and their employees. However, we have formed the provisional view, for the same reasons given by the Full Bench in the April decision, that it would be necessary to achieve the modern awards objective for such provisions to be included in the three awards on the basis that they apply to all employers and employees and operate until 30 September 2020. We will invite submissions from interested parties in response to this provisional view. Such submission must be filed within 7 days of the date of this decision.
Modification of ordinary hours of work
[58] We are not satisfied that the proposed facilitative provision for the modification of ordinary hours is necessary to achieve the modern awards objective. With respect to the Building Award, clause 33.5(a) already provides that the working day may start at 6.00am by agreement. Clause 28.2(a) of the Joinery Award already provides that the span of hours starts at 6.00 am and ends at 7.00pm, and clause 31 provides for alternative working arrangements as to ordinary hours of work by agreement. Clause 21.1 of the Mobile Crane Award provides for a 6.00am start. All three awards allow for individual flexibility agreements under which the application of award provisions concerning arrangements for when work is performed, overtime rates and penalty rates may be varied. The evidence did not demonstrate that these provisions were not achieving the modern awards objective, nor did it demonstrate in any event that it was necessary to have employees working after 6.00pm or on Saturday mornings in order to work efficiently in the context of hygiene or social distancing requirements.
Redundancy pay
[59] Clause 17 of the Building Award contains an industry-specific redundancy scheme which has the following features relevant to the application:
(1) The definition of redundancy in clause 17.2 applies to any termination of employment, even where initiated by the employee, except where the termination is for reasons of misconduct or refusal of duty. Unlike the NES redundancy entitlement in s 119 of the FW Act, it is not limited in its application to a situation where the employee’s employment is terminated at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone (except where this is due to the ordinary and customary turnover of labour) or because of the employer’s bankruptcy or insolvency.
(2) The scale of redundancy payments in clause 17.3(a) is, at a number of service points, less than that provided for in the NES scale in s 119. Clause 17.3(a) provides a maximum payment of 8 week’s pay for 4 or more years’ services, while the NES scale continues beyond 4 years’ service to a maximum payment of 16 weeks’ pay for more than 9 but less than 10 years’ service.
(3) There is no exemption from the obligation to pay redundancy pay for small business employers (employers employing fewer than 15 employees), unlike the NES provision in s 121(1)(b).
(4) The industry-specific scheme has no equivalent to the facility in s 120 of the FW Act for employers to apply for a reduction of redundancy pay where the employer obtains other acceptable employment for the employee or cannot pay the amount.
[60] The application seeks to modify the first and fourth elements of the scheme to align them with the NES scheme.
[61] Clause 12 of the Mobile Crane Award contains a different industry-specific redundancy scheme that, unlike the Building Award, applies to termination of employment by the employer where the number of employees exceeds those reasonably required to perform the available work, and has a different scale of retrenchment payments which are less generous than the NES scale at one year’s service, but significantly more generous for longer periods of service. It contains no exemption for small business employers and has no equivalent facility to s 120 of the FW Act. The applicants did not precisely specify the variations which they sought, but their “mirror” variation is presumably focused on the last aspect of the scheme. In respect of redundancy, clause 17 of the Joinery Award simply contains a note referring to the NES redundancy provisions in ss 119-123 of the FW Act, and supplements this with provisions for redundancy pay applicable to small business employers. The applicants’ “mirror” variation for the Joinery Award would not appear to have any relevant application to clause 17 of that award and therefore does not require further consideration.
[62] Clause 17 of the Building Award was the subject of extensive consideration in the 4 yearly review conducted pursuant to the former s 156 of the FW Act, in response to employer proposals to modify all four elements of the industry-specific scheme in various ways. In a Full Bench decision issued on 26 September 2018, 12 those proposals for alteration to the scheme were rejected. The Full Bench analysed the history of the scheme in considerable detail, and noted that the inclusion of the scheme in the modern award was on the basis that the scheme, considered in totality, was no less beneficial to employees in the industry than the NES provisions taking into account the different severance pay scale, the broader application of the provision and the pattern of limited periods of continuous service in the industry to which the provision was directed.13 In rejecting the employer claims, the Full Bench said:
“[80] …We have no reason to conclude that the original rationale for the features of the scheme, including the frequency of short periods of employee service across sequential employers in the industry, the significant fluctuations in the size of employee numbers in a business depending upon work demand, and the prevalence of small contract businesses working alongside larger contractors on building and construction sites, does not remain wholly valid today. Nor has it been established, having regard to the totality of the industry-specific scheme including its partially less beneficial severance pay scale, that the scheme has an overall cost that would be significantly in excess of the NES scheme if at all.”
[63] The Full Bench also concluded that a change to the definition of redundancy whilst leaving redundancy pay scale unchanged would “alter the industrial balance of the scheme and its historic industry-specific character”.
[64] In this case, there was simply no probative evidence about the operation of clause 17 of the Building Award in the context of the current pandemic adduced by the applicants. The only evidence concerning the redundancy scheme was that the HIA had been fielding increased inquiries from its members about their redundancy obligations, and that:
• one member who intended to make 4 of its 10 employees redundant (notwithstanding that it was not eligible for JobKeeper subsidies) was upset to find that it had redundancy payment obligations notwithstanding that it was a small business, and was concerned that this would be a financial strain;
• another member was unaware that an intended conversion of a full-time employee to casual status would result in consultation and redundancy obligations under the Building Award; and
• a third member, whose renovation work was reduced, was concerned that they could not stand down employees under the FW Act and indicated there was a real potential for redundancy if employees did not agree to take leave or reduce hours.
[65] There have clearly been job losses in the construction industry since the commencement of the pandemic, and presumably this has meant that there has been a requirement for employers to make redundancy payments pursuant to clause 17 of the Building Award. However there is no evidence that any such redundancy payments required to be made under clause 17, considered in aggregate, have been more costly to employers than they would have been if the redundancy scale in s 119 of the FW Act had applied, and there is a real possibility (depending on the service profile of the redundant employees) that they may have cost less. Further, there is no evidence that during the pandemic:
• any employers covered by the Building Award have been required to make redundancy payments in circumstances where they have found other acceptable employment for redundant employees;
• any employer has been unable to pay redundancy payments required to be made by clause 17 of the Building Award; or
• any redundancy payment has been required to be made to any employee who has not been terminated at the initiative of the employer.
[66] Accordingly, we do not consider that it is necessary in the circumstances of the current pandemic to vary clause 17 of the Building Award in order to meet the modern awards objective. Having regard as relevant factors to paragraphs (d), (f), and (h) of s 134(1) of the FW Act, we are not persuaded that the variations to clause 17 of the Building Award sought by the applicants would have any beneficial effect on the efficient and productive performance of work, the productivity, employment costs and regulatory burden of business, or employment growth, inflation and the sustainability, performance and competitiveness of the national economy. We also reject the “mirror” variations sought with respect to clause 12 of the Mobile Crane Award.
Minimum casual engagement
[67] There was no evidence supporting this aspect of the application, and accordingly there is no basis for us to conclude that a reduction in the minimum engagement of casual employees is necessary to maintain employment. Casual employees, by definition, have no guarantee of ongoing employment, and therefore the basis upon which it could be contended that such a provision is protective of the employment of casuals is not readily comprehensible. The claim to reduce the minimum engagement period of casual employees in the Joinery Award is, we consider, merely seeking to re-agitate a claim that was advanced by the HIA, MBA and the Ai Group in the 4 yearly review and rejected. In the decision concerning part-time and casual employment in the 4 yearly review issued on 5 July 2017, 14 the Full Bench said in relation to this claim:
“[868] There was no evidence before us about the extent of casual employment in the joinery industry or the purposes for which casual employees are used (if at all) or which identified any particular difficulty with the operation of clause 12.3. We therefore cannot be satisfied that clause 12.3 as it currently stands is not meeting the modern awards objective. That the minimum engagement period is higher than that in many other awards is not by itself demonstrative of the proposition that clause 12.3 cannot legitimately form part of a fair and relevant safety net of terms and conditions. The claim is therefore rejected.”
[68] There has been no advance upon this position in the current proceeding.
Modern awards objective
[69] In reaching the above conclusions (except in respect of unpaid pandemic leave and taking double annual leave at half pay), we have taken into account the considerations specified in s 134(1)of the FW Act in the following way (by reference to the paragraph letter used in the subsection):
(a) This consideration is of limited relevance. The building and construction industry has a high incidence of wage rates that are well in excess of award rates (whether through enterprise agreements, contracts of employment or informal market-rates arrangements), such that it does not contain a significant proportion of low paid employees.
(b) The application might, if granted, serve to discourage collective bargaining to some degree (because it seeks to meet the perceived flexibility needs of business enterprises through award provisions), and accordingly this weights against the grant of the application.
(c) The purpose of the application is said to be to seek to maintain employment and workforce participation in the context of the current pandemic, but for the reasons explained, we are not satisfied that the proposed variations would achieve that purpose in any meaningful way.
(d) We are not satisfied that the variations proposed would promote flexible modern work practices or the efficient and productive performance of work.
(da) This is not a significantly relevant consideration, although we note that the effect of the applicants’ proposed provision for modification of ordinary hours might, if granted, have the effect of removing current entitlements to overtime or weekend penalty rates.
(e) This is not a relevant consideration.
(f) We accept that, if we exercised modern award powers to grant the application, it may have the effect of reducing employment costs in that employees may become entitled to less pay. We are not satisfied that the grant of the application would have any beneficial effect on productivity and the regulatory burden. Although measures taken by employers in response to the COVID-19 pandemic may in some cases have had the effect of reducing productivity, the evidence does not support the conclusion that the proposed award variations would ameliorate this.
(g) The introduction of provisions which are to apply only to non-eligible employers, would add complexity and reduce the stability of the three modern awards in question.
(h) We are not persuaded that the grant of the applications would have any beneficial results for employment growth, inflation, and the sustainability, performance and competitiveness of the national economy.
[70] Except in relation to unpaid pandemic leave and the taking of double annual leave at half pay, we do not propose to vary the awards in the manner sought in the application. Submissions in response to the provisional view we have expressed in paragraph [57] above concerning varying the awards to provide for unpaid pandemic leave and the taking of double annual leave at half pay must be filed by 5.00pm on 10 August 2020.
[71] Notwithstanding the conclusions we have reached in this decision, we will not conclude the proceeding at this time. Shortly before the publication of this decision, the Victorian Government announced “Stage 4” restrictions in response to the recent surge in COVID-19 cases in Victoria. Under those restrictions, construction sites have not been shut down but as we understand are permitted to continue to operate subject to meeting “Universal COVID Safe Plan obligations”. In addition, apart from the construction of critical and essential infrastructure, and services to support these projects, and critical repairs to residential premises for emergency or safety purposes, the following restrictions apply:
(1) Large scale construction: Any building construction project of more than three storeys must have a maximum of 25 percent of normal employees on site compared to normal operations, must have a High Risk COVID Safe plan, and must demonstrate that shifts are not being blended and workers can only work at one site.
(2) Small scale construction: Any building construction project of three storeys or less may have a maximum of five workers on site, and must demonstrate that shifts are not being blended and workers can only work at one site.
(3) State civil construction: No reduction targets, but are required to implement a High Risk COVID Safe plan.
[72] These business restrictions, for practical purposes, came into effect today. It is obviously not possible at this time to assess what their effect on work and employment will be, but the potential for detrimental effects on business activity is obvious. It is possible that award variations may become necessary in order for employers to be able to continue to operate in a manner that is compliant with the restrictions. Accordingly, the course we propose to take is to stand this matter over until the effect of the Stage 4 restrictions is better known. The matter may be relisted on request at short notice, and we will monitor events ourselves and may relist the matter on our own initiative.
VICE PRESIDENT
Appearances:
Ms R Sostarko on behalf of Master Builders Australia.
Ms M Adler on behalf of the Housing Industry Association Ltd.
Ms V Paul on behalf of the Australian Industry Group.
Mr P Boncardo of Counsel with Mr S Maxwell on behalf of the Construction, Forestry, Maritime, Mining and Energy Union – Construction and General Division.
Ms V Wiles on behalf of the Construction, Forestry, Maritime, Mining and Energy Union – Manufacturing Division.
Mr S Crawford on behalf of the Australian Workers’ Union.
Ms A Ambihaipahar on behalf of Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia.
Ms A Devasia for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU).
Mr G Miller for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU).
Hearing details:
2020.
Sydney (via video-link).
14 and 15 July.
Printed by authority of the Commonwealth Government Printer
<PR721607>
Annexure A
MA000020 PRXXXXX
Fair Work Act 2009
s.157 – FWC may vary etc. modern awards if necessary to achieve modern awards objective
(AMXXXX/XX) [MA000020]
Building, metal and civil construction industries
JUSTICE ROSS, PRESIDENT XXXX
XXXX
MELBOURNE, XX XX 2020
Application to vary the Building and Construction General On-Site Award 2010 – COVID-19 Pandemic
A. Further to the decision [[2020 FWCFB XXXX]] issued by the Fair Work Commission on XX XX 2020, the above award is varied as follows:
1. By inserting Schedule H as follows:
H.1.1 - Subject to clauses H.5.1(d), H.5.2(d), H.5.5(d) and H.11.1(a), Schedule H operates from XX XXX 2020 until 31 December 2020. The period of operation can be extended on application.
H.1.2 – Schedule H does not apply to any employee employed by an employer who qualifies for the ‘JobKeeper’ Scheme if the employee is eligible to receive ‘JobKeeper’ payments pursuant to the Coronavirus Economic Response Package (Payments and Benefits) Act 2020.
a) make temporary changes to assist the Australian people to keep their jobs, and maintain their connection to their employers, during the unprecedented economic downturn and work restrictions arising from:
i) the COVID‑19 pandemic; and
ii) government initiatives to slow the transmission of COVID‑19; and
b) help sustain the viability of Australian businesses during the COVID‑19 pandemic, including by preparing the Australian economy to recover with speed and strength after a period of hibernation; and
c) continue the employment of employees; and
d) ensure the continued effective operation of occupational health and safety laws during the COVID‑19 pandemic; and
e) help ensure that, where reasonably possible, employees:
i) remain productively employed during the COVID‑19 pandemic; and
ii) continue to contribute to the business of their employer where it is safe and possible for the business to continue operating.
H.2 – General conditions applicable to this Schedule
1. H.2.1 Directions/Requests to Employees
a) All directions or requests issued by an employer to an employee pursuant to this Schedule must:
i) be in writing with a copy retained as an employee record; and
ii) must not be unreasonable in all of the circumstances;
NOTE: A direction may be unreasonable depending on the impact of the direction on any caring responsibilities the employee may have.
b) A direction or request from an employer to an employee made pursuant to this Schedule has no effect unless done so for reasons that the employer reasonably believes are consistent with the overall intent of this Schedule outlined at clause H.1.
c) A direction or request made pursuant to this Schedule has no effect unless the employer has information before the employer that leads the employer to reasonably believe that the direction is necessary to continue the employment of one or more employees of the employer.
d) In determining whether a direction or request given by an employer to an employee of the employer (the relevant employee) under this Schedule is necessary to continue the employment of one or more employees of the employer, it is immaterial that a similar direction could have been given by the employer to an employee of the employer other than the relevant employee.
e) A direction or request given by an employer to an employee of the employer under this Schedule continues in effect until:
i) it is withdrawn or revoked by the employer; or
ii) it is replaced by a new direction or request given by the employer to the employee under the relevant clause within this Schedule; or
iii) it is revoked or varied by an order made by the FWC; or
iv) it ceases to have effect due to the expiration of this Schedule.
f) If a direction given by an employer applies to an employee of the employer, the employee must comply with the direction.
g) If an employee is subject to a direction issued pursuant to this Schedule during a period, that period counts as service.
h) If a direction to reduce hours applies to an employee, the employee accrues leave entitlements as if the direction had not been given.
i) If a direction to reduce hours applies to an employee, the following are to be calculated as if the direction had not been given:
i) redundancy pay;
ii) payment in lieu of notice of termination.
j) If an employee takes paid annual leave in accordance with an agreement or direction under this Schedule, the employee accrues leave entitlements as if the agreement had not been made.
k) If an employee takes paid annual leave in accordance with an agreement or direction under this Schedule, the following are to be calculated as if the agreement had not been made:
i) redundancy pay;
ii) payment in lieu of notice of termination.
a) A direction given by an employer to an employee of the employer pursuant to this Schedule does not apply to the employee unless:
i) the employer gave the employee written notice of the employer’s intention to give the direction; and
ii) the employer did so:
• at least 3 days before the direction was given; or
• if the employee genuinely agreed to a lesser notice period—during that lesser notice period; and
iii) before giving the direction, the employer consulted the employee (or a representative of the employee) about the direction.
b) Subsection a) does not apply to a direction (the relevant direction) given by an employer to an employee of the employer under a particular section of this Schedule if:
i) the employer previously complied with paragraphs a) (i), (ii) and (iii) in relation to a proposal to give the employee another direction under that clause; and
ii) in the course of consulting the employee (or a representative of the employee) about the proposal, the employee (or the representative of the employee) expressed views to the employer; and
iii) the employer considered those views in deciding to give the relevant direction.
ii) it is replaced by a new direction or request given by the employer to the employee under the relevant clause within this Schedule; or
iii) it is revoked or varied by an order made by the FWC; or
iv) it ceases to have effect due to the expiration of this Schedule.
f) If a direction given by an employer applies to an employee of the employer, the employee must comply with the direction.
g) If an employee is subject to a direction issued pursuant to this Schedule during a period, that period counts as service.
h) If a direction to reduce hours applies to an employee, the employee accrues leave entitlements as if the direction had not been given.
i) If a direction to reduce hours applies to an employee, the following are to be calculated as if the direction had not been given:
i) redundancy pay;
ii) payment in lieu of notice of termination.
j) If an employee takes paid annual leave in accordance with an agreement or direction under this Schedule, the employee accrues leave entitlements as if the agreement had not been made.
k) If an employee takes paid annual leave in accordance with an agreement or direction under this Schedule, the following are to be calculated as if the agreement had not been made:
i) redundancy pay;
ii) payment in lieu of notice of termination.
a) A direction given by an employer to an employee of the employer pursuant to this Schedule does not apply to the employee unless:
i) the employer gave the employee written notice of the employer’s intention to give the direction; and
ii) the employer did so:
• at least 3 days before the direction was given; or
• if the employee genuinely agreed to a lesser notice period—during that lesser notice period; and
iii) before giving the direction, the employer consulted the employee (or a representative of the employee) about the direction.
b) Subsection a) does not apply to a direction (the relevant direction) given by an employer to an employee of the employer under a particular section of this Schedule if:
i) the employer previously complied with paragraphs a) (i), (ii) and (iii) in relation to a proposal to give the employee another direction under that clause; and
ii) n the course of consulting the employee (or a representative of the employee) about the proposal, the employee (or the representative of the employee) expressed views to the employer; and
iii) the employer considered those views in deciding to give the relevant direction.
c) An employer must keep a written record of a consultation under paragraph a) (iii) with:
i) an employee of the employer; or
ii) with a representative of an employee of the employer.
Amend clause 8.5 to insert new subclause (h) as follows:
h) temporary arrangements given effect by Schedule H.
H.3.1 H.3.1 Disputes
a) Any disputes which arise under this Schedule shall be dealt with pursuant to the procedure established within this Award.
• a) An employer must not purport to give a direction or request if:
i) the direction or request is not authorised by this Schedule; and
ii) the employer knows that the direction or request is not authorised by this Schedule.
a) For the avoidance of doubt, each of the following is a workplace right within the meaning of Part 3‑1 of the Fair Work Act 2009:
i) the benefit that an employee of an employer has or derives because of an obligation of the employer to satisfy the conditions of this Schedule;
ii) agreeing, or not agreeing, to perform duties in accordance with this Schedule:
• on different days; or
• at different times;
iii) agreeing, or not agreeing, to take paid annual leave in compliance with a request or direction made in accordance with this Schedule; or
iv) making a request for secondary employment, training etc.
H.4.2 H.4.3 Relationship with other laws etc.
a) This Schedule will at all times operate subject to the following provisions of the Fair Work Act 2009:
i) Division 2 of Part 2‑9 (payment of wages etc.);
ii) Part 3‑1 (general protections);
iii) Part 3‑2 (unfair dismissal);
iv) section 772 (employment not to be terminated on certain grounds);
v) an anti‑discrimination law;
vi) a law of the Commonwealth, a State or a Territory, so far as the law deals with health and safety obligations of employers or employees;
vii) a law of the Commonwealth, a State or a Territory, so far as the law deals with workers’ compensation.
b) This Schedule has effect subject to a person’s right to be represented, or collectively represented, by an employee organisation or employer organisation.
a) Subject to clauses H.5.1(b), (c) and (d), any employee is entitled to take up to 2 weeks’ unpaid leave if the employee is required by government or medical authorities or on the advice of a medical practitioner to self-isolate and is consequently prevented from working, or is otherwise prevented from working by measures taken by government or medical authorities in response to the COVID-19 pandemic.
b) The employee must give their employer notice of the taking of leave under clause H.5.1(a) and of the reason the employee requires the leave, as soon as practicable (which may be a time after the leave has started).
c) An employee who has given their employer notice of taking leave under clause H.5.1(a) must, if required by the employer, give the employer evidence that would satisfy a reasonable person that the leave is taken for a reason given in clause H.5.1(a).
d) A period of leave under clause H.5.1(a) must start before 31 December 2020, but may end after that date.
e) Leave taken under clause H.5.1(a) does not affect any other paid or unpaid leave entitlement of the employee and counts as service for the purposes of entitlements under this award and the NES.
NOTE: The employer and employee may agree that the employee may take more than 2 weeks’ unpaid pandemic leave.
H.5.2 H.5.2 Annual leave at half pay
a) Instead of an employee taking paid annual leave on full pay, the employee and their employer may agree to the employee taking twice as much leave on half pay.
b) Any agreement to take twice as much annual leave at half pay must be recorded in writing and retained as an employee record.
c) A period of leave under clause H.5.2(a) must start before 31 December 2020, but may end after that date.
EXAMPLE: Instead of an employee taking one week’s annual leave on full pay, the employee and their employer may agree to the employee taking 2 weeks’ annual leave on half pay. In this example:
• the employee’s pay for the 2 weeks’ leave is the same as the pay the employee would have been entitled to for one week’s leave on full pay (where one week’s full pay includes leave loading under the Annual Leave clause of this award); and
• one week of leave is deducted from the employee’s annual leave accrual.
NOTE 1: A employee covered by this award who is entitled to the benefit of clause H.5.1 or H.5.2 has a workplace right under section 341(1)(a) of the Act.
NOTE 2: Under section 340(1) of the Act, an employer must not take adverse action against an employee because the employee has a workplace right, has or has not exercised a workplace right, or proposes or does not propose to exercise a workplace right, or to prevent the employee exercising a workplace right. Under section 342(1) of the Act, an employer takes adverse action against an employee if the employer dismisses the employee, injures the employee in his or her employment, alters the position of the employee to the employee’s prejudice, or discriminates between the employee and other employees of the employer.
NOTE 3: Under section 343(1) of the Act, a person must not organise or take, or threaten to organise or take, action against another person with intent to coerce the person to exercise or not exercise, or propose to exercise or not exercise, a workplace right, or to exercise or propose to exercise a workplace right in a particular way.
a) Instead of clauses 38.XX - An employer may direct an employee to take any annual leave that has accrued, by giving at least one weeks’ notice, or any shorter period of notice that may be agreed.
b) A direction to take annual leave shall not result in an employee having less than two weeks of accrued annual leave remaining.
a) Instead of clauses 33.XX - An employer may direct full-time and part-time employees in a workplace or section of a workplace to take any accrued Rostered Days Off that are accrued, by giving at least one weeks’ notice, or any shorter period of notice that may be agreed.
a) Instead of clauses 33.XX - An accrued RDO will be taken in one of the following ways:
• on one day during a 20 day four week cycle on which all employees will take a RDO in accordance with a written roster fixed by the employer and issued 7 days before the commencement of that cycle; or
• on a day during a 20 day four week cycle during which particular employees will take their RDOs on different days in accordance with a written roster fixed by the employer and issued 7 days before the commencement of that cycle; or
• by any other method that is agreed by the employer and a majority of that employer’s employees and recorded in writing.
b) The means by which a written roster under clause 33.XX may be issued include but are not limited to the following:
• by giving an employee a copy of the written roster; or
• by placing a copy of the written roster on the notice board(s) at the workplace; or
• by sending the written roster to the employee by post in a prepaid envelope to an employee’s usual residential or postal address, by facsimile transmission, or by email or other electronic means; or
• by any other means agreed to by the employer and employee.
c) A roster issued in accordance with clause 33.XX must not require an employee to take an RDO on a day that is a public holiday.
d) Clause H.5.5 operates from XX XXX 2020 until 30 June 2020.
a) An employee will perform all duties that are within their skill and competency regardless of their classification under clause 18 and Schedule B, provided that the duties are safe, and the employee is licensed and qualified to perform them, where necessary.
b) No employee shall have their pay reduced as a result of being directed to perform duties in accordance with this clause.
a) After the commencement of this Schedule, an employer may give an employee a direction during a period to:
i) not work on a day or days on which the employee would usually work; or
ii) work for a lesser period than the period which the employee would ordinarily work on a particular day or days; or
iii) work a reduced number of hours (compared with the employee’s ordinary hours of work);
b) A direction made pursuant to clause H.7.1 a) will only be valid if;
i) the employee cannot be usefully employed for the employee’s normal days or hours during the period of reduced hours because of changes to business attributable to:
• the COVID‑19 pandemic; or
• government initiatives to slow the transmission of COVID‑19; and
ii) the implementation of the direction is safe, having regard to (without limitation) the nature and spread of COVID‑19; and
iii) the direction is given for a period that consists of or includes the operation of this Schedule.
c) If a direction made pursuant to clause H.7.1 a) is given to an employee, the employer must, during the period to which the direction relates:
i) pay the employee the ordinarily applicable hourly rate of pay for all hours worked; and
ii) apply all conditions as specified in this Award as may be relevant and otherwise applicable to the hours worked;
iii) but is not otherwise required to make payments to the employee in respect of the period of reduced hours.
e) A direction under this Schedule does not apply to an employee during a period when the employee:
i) is taking paid or unpaid leave that is authorised by the employer; or
ii) is otherwise authorised to be absent from the employee’s employment.
f) An employee may take paid or unpaid leave (for example, annual leave) during all or part of a period during which the direction to reduce hours of work would otherwise apply to the employee.
g) For the purposes of clause H.7.1 a) the reduced number of hours may be nil.
a) Instead of clause 33.1 – If the employer and employee agree, except as provided in clause 34 – Shiftwork, the ordinary working hours will be 38 per week, worked between 6.00 am and 7.00 pm Monday to Friday, and 6:00am and 2:00pm Saturdays in accordance with the following procedure.
a) An employer may direct an employee directed to perform duties during a period (the relevant period) at a place that is different from the employee’s normal place of work.
b) If a direction made pursuant to clause H.8.1 a) is given to an employee, the employer must, during the period to which the direction relates ensure that:
i) the location of work is suitable for the employee’s duties; and
ii) the location does not require the employee to travel a distance that is unreasonable in all the circumstances, including the circumstances surrounding the COVID‑19 pandemic; and
iii) the performance of the employee’s duties at the place is:
• safe, having regard to (without limitation) the nature and spread of COVID‑19; and
• reasonably within the scope of the employer’s business operations.
a) The definition at clause 17.2 of the Award will have no effect during the operation of this Schedule shall be replaced by the definition at s.389 of the Fair Work Act 2009.
b) The giving of a direction or request pursuant to this Schedule does not amount to a redundancy.
This section applies if:
a) an employee is entitled to be paid an amount of redundancy pay by the employer because of clause 17; and
b) the employer:
i) obtains other acceptable employment for the employee; or
ii) cannot pay the amount.
c) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the FWC considers appropriate.
d) The amount of redundancy pay to which the employee is entitled under clause 17.3 is the reduced amount specified in the determination.
Instead of clause 14.4 - A casual employee is entitled to payment for a minimum of two hours’ work per engagement, plus the relevant fares and travel allowance and expenses prescribed by clauses 24 – Living away from home – distant work and 25 – Fares and travel patterns allowance on each occasion they are required to attend work.
a) Clause H.11.1 and corresponding Schedule I operate from XX XXX 2020 until 30 June 2020.
b) Clause H.11.1 does not apply to daily hire employees or casual employees.
c) An employee and employer may agree in writing to the employee taking time off instead of being paid for a particular amount of overtime that has been worked by the employee.
d) Any amount of overtime that has been worked by an employee in a particular pay period and that is to be taken as time off instead of the employee being paid for it must be the subject of a separate agreement under clause H.11.1.
e) An agreement must state each of the following:
iii) the number of overtime hours to which it applies and when those hours were worked;
iv) that the employer and employee agree that the employee may take time off instead of being paid for the overtime;
v) that, if the employee requests at any time, the employer must pay the employee, for overtime covered by the agreement but not taken as time off, at the overtime rate applicable to the overtime when worked;
vi) that any payment mentioned in subparagraph (iii) must be made in the next pay period following the request.
NOTE: An example of the type of agreement required by this clause is set out at Schedule I. There is no requirement to use the form of agreement set out at Schedule I. An agreement under clause H.11.1 can also be made by an exchange of emails between the employee and employer, or by other electronic means.
f) The period of time off that an employee is entitled to take is the same as the number of overtime hours worked.
EXAMPLE: By making an agreement under clause H.11.1 an employee who worked 2 overtime hours is entitled to 2 hours’ time off.
g) Time off must be taken:
i) within the period of 6 months after the overtime is worked; and
ii) at a time or times within that period of 6 months agreed by the employee and employer.
h) If the employee requests at any time, to be paid for overtime covered by an agreement under clause H.11.1 but not taken as time off, the employer must pay the employee for the overtime, in the next pay period following the request, at the overtime rate applicable to the overtime when worked.
i) If time off for overtime that has been worked is not taken within the period of 6 months mentioned in paragraph (f), the employer must pay the employee for the overtime, in the next pay period following those 6 months, at the overtime rate applicable to the overtime when worked.
j) The employer must keep a copy of any agreement under clause H.11.1 as an employee record.
k) An employer must not exert undue influence or undue pressure on an employee in relation to a decision by the employee to make, or not make, an agreement to take time off instead of payment for overtime.
l) An employee may, under section 65 of the Act, request to take time off, at a time or times specified in the request or to be subsequently agreed by the employer and the employee, instead of being paid for overtime worked by the employee. If the employer agrees to the request then clause H.11.1 will apply, including the requirement for separate written agreements under paragraph (c) for overtime that has been worked.
NOTE: If an employee makes a request under section 65 of the Act for a change in working arrangements, the employer may only refuse that request on reasonable business grounds (see section 65(5) of the Act).
m) If, on the termination of the employee’s employment, time off for overtime worked by the employee to which clause H.11.1 applies has not been taken, the employer must pay the employee for the overtime at the overtime rate applicable to the overtime when worked.
NOTE: Under section 345(1) of the Act a person must not knowingly or recklessly make a false or misleading representation about the workplace rights of another person under clause H.11.1.
2. By inserting Schedule I as follows:
Name of employee: ____________________
Name of employer: ____________________
The employer and employee agree that the employee may take time off instead of being paid for the following amount of overtime that has been worked by the employee:
Date and time overtime started: ____/____ /20 ____am/pm
Date and time overtime ended:____ /____ /20 ____am/pm
Amount of overtime worked: hours and minutes
The employer and employee further agree that, if requested by the employee at any time, the employer must pay the employee for overtime covered by this agreement but not taken as time off. Payment must be made at the overtime rate applying to the overtime when worked and must be made in the next pay period following the request.
Signature of employee: ____________________
Date signed:____ /____ /20 ____
Name of employer ____________________
representative: ____________________
Signature of employer ____________________
representative: ____________________
Date signed:____ / ____/20 ____
3. By updating the table of contents and cross-references accordingly.
B. This determination comes into operation on XX XX 2020. In accordance with s. 165(3) of the Fair Work Act 2009 this determination does not take effect until the start of the first full pay period that starts on or after XX XX 2020.
PRESIDENT
Printed by authority of the Commonwealth Government Printer
Annexure B
MA000020 PRXXXXX
Fair Work Act 2009
s.157 – FWC may vary etc. modern awards if necessary to achieve modern awards objective
(AMXXXX/XX) [MA000029]
Building, metal and civil construction industries
JUSTICE ROSS, PRESIDENT XXXX
MELBOURNE, XX XX 2020
Application to vary the Joinery and Building Trades Award 2010 – COVID-19 Pandemic
A. Further to the decision [[2020 FWCFB XXXX]] issued by the Fair Work Commission on XX XX 2020, the above award is varied in accordance with item 1. The variations within this determination operate until 31 December 2020. The period of operation can be extended on application.
B. This Determination does not apply to any employee employed by an employer who qualifies for the ‘JobKeeper’ Scheme if the employee is eligible to receive ‘JobKeeper’ payments pursuant to the Coronavirus Economic Response Package (Payments and Benefits) Act 2020.
1. By deleting clause 12.3 and inserting the following:
12.3 A casual employee is engaged by the hour with a minimum daily engagement of 2 hours.
2. By updating the table of contents and cross-references accordingly.
C. This determination comes into operation on XX XX 2020. In accordance with s. 165(3) of the Fair Work Act 2009 this determination does not take effect until the start of the first full pay period that starts on or after XX XX 2020.
PRESIDENT
Printed by authority of the Commonwealth Government Printer
1 Coronavirus Economic Response Package Omnibus (Measures No.2) Act 2020 (Cth)
3 [2020] FWCFB 1837; 293 IR 378
7 ABS, Weekly Payroll Jobs and Wages in Australia, Week ending 30 May 2020, 6160.0.55.001
8 ABS, Labour Force, Australia, Detailed, Quarterly, May 2020, 6291.0.55.003
9 ABS, Labour Force, Australia, May 2020, 6202.0
10 ABS, Engineering Construction Activity, March 2020, 8762.0
11 [2018] FWCFB 6019 at [404]-[412]
13 Ibid at [75]
14 [2017] FWCFB 3541; 269 IR 125