DECISION

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

Four yearly review of modern awards – plain language re-drafting – facilitative provisions altering spread of hours
(AM2016/15)

4 yearly review of modern awards – plain language re-drafting – spread of hours clauses – remove ambiguity.

Introduction and background

[1] In a decision issued on 20 August 2019 1 (August 2019 decision), we dealt with an ambiguity in a number of awards concerning facilitative provisions permitting the alteration of the span of hours by up to one hour at either end of the spread (the Alteration clause). This decision will finalise the matters outstanding from the August 2019 decision in respect of the Alteration clause and in doing so will deal with matters raised in the parties’ subsequent submissions.

[2] The list of awards being reviewed in relation to the Alteration clause is as follows:

•  Airline Operations—Ground Staff Award 2010 (now Airline Operations - Ground Staff Award 2020) (Airline Ground Staff Award);

•  Aquaculture Industry Award 2010 (now Aquaculture Industry Award 2020);

•  Business Equipment Award 2010 (now Business Equipment Award 2020) (Business Equipment Award);

•  Clerks – Private Sector Award 2010 (now Clerks - Private Sector Award 2020) (Clerks Award);

•  Contract Call Centres Award 2010 (now Contract Call Centres Award 2020) (Call Centres Award);

•  Food, Beverage and Tobacco Manufacturing Award 2010 (now Food, Beverage and Tobacco Manufacturing Award 2020) (Food Manufacturing Award);

•  Manufacturing and Associated Industries and Occupations Award 2010 (now Manufacturing and Associated Industries and Occupations Award 2020) (Manufacturing Award);

•  Pharmaceutical Industry Award 2010 (now Pharmaceutical Industry Award 2020) (Pharmaceutical Industry Award);

•  Seafood Processing Award 2010 (now Seafood Processing Award 2020) (Seafood Processing Award);

•  Storage Services and Wholesale Award 2010 (now Storage Services and Wholesale Award 2020) (Storage Services Award); and

•  Sugar Industry Award 2010 (now Sugar Industry Award 2020) (Sugar Industry Award).

[3] In the August 2019 decision, we expressed the following provisional views:

“[228] It is our provisional view that the Alteration clauses were intended to operate so that an agreement made with a group of employees or, where available, with an individual employee, permitted an alteration to shift the entire spread of hours forward by one hour or back by one hour. Hence, if the standard spread is 6am to 6pm (a 12 hour spread) the Alteration clause would facilitate the variation of the spread forward to 5am to 5pm, or back to 7am to 7pm, retaining the 12 hour spread. This approach is consistent with the language used in the provisions. The alternative approaches contended for have no practical utility because, as earlier stated, they cannot result in the employee’s number of ordinary working hours in the day being extended.

[229] However it also seems to us that the Alteration clauses were not intended to prohibit different agreements being reached with different groups in an enterprise or, where an Alteration clause permits agreement to be reached with individual employees, different agreements being reached with different individuals. For example, it may suit the employer and a group of employees in a part of the enterprise with a common start time to vary the standard spread to facilitate an early start - say at 5am. In the case of this group of employees, the effect of such an agreement would be to alter the spread of hours for that group to 5am to 5pm. It may suit the employer and a group in another part of the enterprise to start later and finish later, in which case they may agree to shift the spread for that group to 7am to 7pm. Likewise, where agreements with individual employees are permitted, the employer may agree with employee X to move the spread of hours forward to 5am to 5pm, and may also agree with employee Y to move the spread back to 7am to 7pm.

[230] To the extent that there is doubt as to the current capacity for employers and employees to take such an approach under the Alteration clauses, we consider that the Alteration clauses should be varied to make it clear that such a capacity exists. We note that a number of awards expressly permit or at least clearly contemplate discrete agreements being reached with particular operational groups of employees in an enterprise. These awards are the Airline Ground Staff Award, the Business Equipment Award, the Call Centres Award, the Food Manufacturing Award, the Manufacturing Award and the Pharmaceutical Industry Award. In the case of the Food Manufacturing Award, for example, it does this by way of a provision separate to the Alteration clause (earlier set out) which refers to a number of identified facilitation clauses in the award generally, including the Alteration clause, and states that they ‘can be utilised by agreement between an employer and the majority of employees in the workplace or a section or sections of it, or the employer and an individual employee’ (clause 8.3(a), italics added). We note that different expressions are used in some of these awards (e.g. ‘in the workplace or a section or sections of it’; ‘in the plant, work section or sections’ etc), but the objective is the same. The position in other awards is less clear; for example, the Clerks Award permits agreement simply with ‘the majority of employees concerned’. However even in the case of that clause, the additional capacity to reach agreements with individual employees implies that different agreements may be reached with different employees, and this in turn implies that different agreements may be reached with different groups of ‘employees concerned’.

[231] It is our provisional view that the 11 modern awards set out at [168] above be varied consistent with the provisional views set out above (at [228]-[230]). Further, it is our provisional view that such variations are necessary to achieve the modern awards objective. In expressing that provisional view we have taken into account the matters in s.134(1)(a) to (h), insofar as they are relevant. In particular, the variations proposed will:

•  promote flexible modern work practices; and

•  ensure that the awards are simple and easy to understand.

[232] In respect of Alteration clauses which currently permit both majority and individual agreement, our provisional view is that they should be varied to read as follows (using the Food Manufacturing Award provision as the template):

30.2 – Ordinary hours of work – day workers

…

(c) The ordinary hours of work are to be worked continuously, except for meal breaks, at the discretion of the employer between 6.00 am and 6.00 pm. The spread of hours (6.00 am to 6.00 pm) may be moved up to one hour forward or one hour back by agreement between an employer and:

(i) the majority of employees at the workplace;

(ii) the majority of employees in a discrete section of the workplace; or

(iii) an individual employee.

Different agreements may be reached with the majority of employees in different sections of the workplace or with different individual employees.

[233] In respect of Alteration clauses which currently permit majority agreement only, our provisional view is that they should be varied to read as follows (using the Pharmaceutical Industry Award as a template):

23.2 Ordinary hours of work—day workers

…

(b) The ordinary hours of work for day workers are to be worked continuously, except for meal breaks and rest pauses, between 7.45 am and 5.15 pm, Monday to Friday inclusive. The spread of hours (7.45 am to 5.15 pm) may be moved up to one hour forward or one hour back by agreement between an employer and:

(i) the majority of employees at the workplace; or

(ii) the majority of employees in a discrete section of the workplace.

Different agreements may be reached with the majority of employees in different sections of the workplace.

[234] We acknowledge that the Alteration clauses in some of the 11 awards (e.g. the Call Centres Award) are structured differently and would require some modification to the above proposed provisions. Draft variation determinations will be published shortly.”

[4] On 2 September 2019, draft variation determinations were issued in conjunction with a statement 2 (September 2019 statement) reflecting our provisional view. Interested parties were provided with an opportunity to file submissions in response to the provisional views expressed in the August 2019 decision and in relation to the draft variation determinations. Parties were also asked to advise whether they sought an oral hearing or whether they preferred that we determine any outstanding issues on the papers. Advice was provided by the Ai Group that a hearing was sought and accordingly a further hearing was conducted on 28 November 2019 (November 2019 hearing).

Submissions in response to the provisional view

[5] In a submission dated 25 September 2019, the Australian Industry Group (Ai Group) urged us to abandon our provisional views to the extent necessary to allow the spread of hours to be varied at both ends on the basis that implementation of our provisional views would “disrupt a large number of existing hours of work arrangements – some of which have been in place for over 20 years”. It advanced, in summary, three points in support of its position:

(1) The provisional view that the Alteration clauses were intended to operate to only permit the entire spread of hours to be shifted forward or back by one hour “is demonstrably not correct” because it is able to identify what the intent was at the time that these clauses were inserted into awards during the award simplification process through its involvement in the 1996-98 Metal Industry Award Simplification Case in the Australian Industrial Relations Commission (AIRC) before Marsh SDP. It referred to materials presented at the hearing and transcript to support this position. It also referred to the decision of Marsh SDP in the Graphic Arts Award Simplification Decision 3 which, while it only allowed an alteration at one end of the span of hours, made it clear than an extension of the span was permitted.

(2) The provisional view that there would be no utility in allowing the spread of hours to be altered at both ends “is not correct”. The Ai Group provided a table which, it submitted, “conclusively demonstrates that there is substantial utility in allowing the spread of hours to be extended in numerous common circumstances under nearly all of the listed Awards” and “that existing vital flexibility for employers and employees will be lost if the provisional view is implemented”. In particular, it submitted that the spread of hours in the Manufacturing Award, the Airline Ground Staff Award, the Business Equipment Award, the Call Centres Award, the Food Manufacturing Award and the Seafood Processing Award needs to be extended at least at one end to permit a 12 hour day to be worked with an unpaid meal break. In respect of the Pharmaceutical Industry Award, and the Storage Services Award, it submitted that the span needs to be extended at one or both ends to allow a longer working day, and in respect of the Clerks Award, it submitted that the spread needs to be extended at both ends to allow a 7 hour day with a half-hour unpaid break or a 6.5 hour day with an hour unpaid break to work on a Saturday (utility submission).

(3) Implementation of the provisional views would alter the existing capacity to access flexibility by agreement between employers and individual employees to suit their needs, cause major operational problems for employers and cause hardship to thousands of employees who have organised their lives, including childcare arrangements, around the flexibility that the existing facilitative provisions provide. It submitted that, by way of example, 12-hour work days are “relatively common” in the manufacturing industry and would no longer be possible if the provisional views are implemented (flexibility submission).

[6] In the alternative, it submitted that we should adopt the approach determined in the Graphic Arts Award Simplification Decision by providing that the spread of hours may be extended by up to one hour at one end of the spread (but not both). The Ai Group did not oppose that part of the provisional view which accommodated different agreements being reached between the employer and different groups of employees in the workplace or, where individual agreements were permitted, with different individuals in the workplace, provided that such agreement allowed for an extension to the span of hours.

[7] The Australian Manufacturing Workers’ Union (AMWU), in submissions filed on 18 October 2019, generally agreed with and supported the provisional views expressed in the August 2019 decision. In respect of the draft determinations issued, the AMWU noted that in respect of the awards that currently permit individual facilitation (the Food Manufacturing Award, Manufacturing Award, Seafood Processing Award and Sugar Industry Award) the qualifying words “in appropriate circumstances” have been removed from the subparagraph in the draft determination that deals with individual facilitation. It submitted that the removal of these words constitutes a substantive variation to an existing restriction on an employer’s capacity to make an agreement with an individual employee and that these qualifying words should be retained.

[8] In response to the Ai Group’s submissions, the AMWU submitted that the assertions contained in the Ai Group’s submissions are more properly the subject of witness evidence, and in the absence of such evidence, should be given no weight. Further, the AMWU submitted that:

(1) In respect of the award simplification proceedings, it has always understood the purpose of the Alteration clause as providing for the alteration of the entire spread of hours, that is, the spread of hours moves as a block and only one additional hour is allowed to be worked at ordinary time. For example, if the spread of hours is expressed as being between 6.00am and 6.00pm, then the facilitative provisions could operate (with agreement) such that the entire spread could be moved to provide for a spread of ordinary hours between 5.00am and 5.00pm or 7.00am and 7.00pm, but not provide for a 13 or 14 hour total spread. It appears that it was the intention of the parties to facilitate “early starts” by agreement and this is how the Alteration clauses are used in practice.

(2) In respect of the utility submission:

(a) The AMWU submitted that the Ai Group’s submission that the statement in the August 2019 decision about the lack of utility in a facilitative provision which allowed an extension at both ends of the span was a “provisional view” was not accurate, since it was not stated as a provisional view. On this point, the Ai Group had the opportunity to make the submissions it raises now in accordance with the timetable set by the Full Bench in a statement issued on 13 November 2018 (November 2018 statement) 4, but chose not to, and the Ai Group should not be permitted to re-litigate a construction point.

(b) In the alternative, the AMWU submitted that the Ai Group’s submissions proceed on the false basis that the maximum number of ordinary hours is 12. It submits that the maximum daily ordinary hours are 8 unless otherwise agreed. Further, it submits that it is crucial to note that 12 hour shift workers are not usually day workers and there are more specific award provisions that deal with such arrangements. Finally, it submits that it is not aware of examples of 12 hour shifts being worked in addition to a half hour/ one hour unpaid lunch break under the terms of the award, and this would be “a very unusual and obscure arrangement”. Such arrangements are worked in the context of continuous shiftwork and meal breaks for these workers are included as part of ordinary hours, which means that the scenario advanced by the Ai Group does not arise.

(3) In respect of the flexibility submission, the AMWU submits that in the absence of probative evidence supporting these assertions, the Commission should dismiss these submissions.

[9] In respect of the Ai Group’s alternative submission relating to the Graphic Arts, Printing and Publishing Award 2010 (Graphic Arts Award), the AMWU submits that this submission is misleading as the award does not allow for an “extension”, as proposed by Ai Group, but rather an “alteration” at clause 30.2(a)(ii). It submitted that the Ai Group’s proposed amendment to the draft determinations does not reflect the status quo in the Graphic Arts Award.

[10] The Australian Workers’ Union and the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) support the AMWU’s submissions. The CFMMEU’s submissions largely echoed those of the AMWU in respect of the utility submission, however it submitted that in practice, where 12 hour shifts in manufacturing are worked by agreement, rest and meal breaks are paid for and are considered as time worked during the 12 hour shift. It referred to early 12 hour shift agreements that reflect this type of arrangement, such as the ACI Glass Packaging, Penrith Glass Workers 12 Hour Shift - Certified Agreement 1997, the QBE 12 Hour Shift Agreement 1993 and the Tasmanian Advanced Minerals Pty Ltd Workplace Agreement 2009 (12 Hour Shift Trial And Other Variations).

December 2019 direction

[11] After a further hearing about the issue on 28 November 2019, a direction was made on 17 December 2019 (December 2019 direction) requiring the Ai Group to file written submissions relating to the following matters:

“(a) The spread of hours in the Metal, Engineering & Associated Industries Award 1998 at the time of the introduction of an Alteration Clause allowing variation of the spread of ordinary hours by agreement.

(b) The date at which the Alteration Clause allowing variation of the spread of hours by agreement was inserted into the Metal, Engineering & Associated Industries Award 1998 and related matters relevant to these proceedings.

(c) The date at which a clause allowing for the introduction of 12 hour shifts by agreement was inserted into the Metal, Engineering & Associated Industries Award 1998 and the purpose of such provisions.

(d) Any relevant decision dealing with award provisions relating to the introduction of 12 hour shifts by agreement into any awards; including any decision addressing the purpose of such provisions.

(e) Any response to the table of award clauses provided to the Commission and marked Exhibit AMWU1 in the hearing which took place on 28 November 2019.

(f) Any interaction between the Alteration Clause allowing variation of the spread of hours, the clause allowing for the introduction of 12 hour shifts and other relevant provisions contained in the Manufacturing and Associated Industries and Occupations Award 2010; as well as the interaction between equivalent provisions in the Metal, Engineering & Associated Industries Award 1998 or other awards relevant to the proceedings.”

[12] Other interested parties were afforded a period of time in which to file submissions in in response to the Ai Group’s submissions. Submissions have now been received from the Ai Group and the AMWU. Interested parties were notified that we would determine the matter on the papers unless any party requested an oral hearing by 1 April 2020. No such request was received and we will determine the matter on the papers accordingly.

Ai Group response to the December 2019 direction

[13] In respect of matters (a) and (b) in the December 2019 direction, the Ai Group submitted that the spread of ordinary hours provided for in the Metal Industry Award 1984 (Metals Award 1984) immediately prior to the award being replaced by the Metal, Engineering & Associated Industries Award 1998 (Metals Award 1998) was between 6.00am and 6.00pm 5. The Ai Group then referred to the spread of hours in the Metals Award 1998 at the time when the award simplification variations were made in April 1998, which stated:

6.1.1(c) The ordinary hours of work are to be worked continuously, except for meal breaks, at the discretion of the employer between 6.00 am and 6.00 pm. The spread of hours (i.e. 6.00 am to 6.00 pm) may be altered by up to one hour at either end of the spread, by agreement between an employer and the majority of employees concerned or in appropriate circumstances, between the employer and an individual employee.

[14] It submitted that the wording of the above clause was the subject of extensive discussion and debate during the award simplification proceedings, however the clause as incorporated by Marsh SDP into the Metals Award 1998 was mutually understood by the parties to allow agreement to be reached on an increase in the spread of ordinary hours. In support of this submission, the Ai Group referred to the fact an amended clause proposed by its predecessor organisations 6 was ultimately accepted by the Commission and included in the award. It contends that an extension of the spread of hours was clearly understood by the parties, as reflected in a publication “Input Extra” distributed to Metal Trades Industry Association of Australia (MTIA) members on 13 March 1998, two days after the Senior Deputy President had issued the Metal Industry Award Simplification Decision7 (underlining added):

“There is the ability to reach agreement with the majority of employees or an individual employee to alter the spread of hours for day workers (ie. 6.00am to 6.00pm) by up to one hour at each end of the spread.”

[15] Further, it submitted that the Metal Trades Federation of Unions (MTFU) had the same understanding of how the proposed clause was to operate on the basis of submissions made by Mr Oliver at a hearing before the Senior Deputy President on 19 February 1998 (underlining added):

“The MTIA has revised its position at 6.1.1(c) in response to the points raised by the MTFU at page 256 of transcript. A proposal to the finer limits, and that is 5 am to 7 pm to which the spread of ordinary hours may be extended, disposes of only one of the MTFU's objection, and that was that the clause did not contain both the entitlement and the framework for departure from it. We still oppose the clause on the grounds previously stated and that is, firstly, the proposal is for an individual without the prior consent of the majority be approached and possibly agreed to extending their spread of ordinary hours.”

[16] The Ai Group again relied on the Graphic Arts Award Simplification Case 8 as indicative of the Senior Deputy President’s intention, as it followed straight after the conclusion of the Metal Industry Award Simplification Case. It says there was no suggestion that anyone involved in those proceedings (being the MTIA, the Printing Industries Association of Australia (PIAA), the AMWU or the Senior Deputy President herself) contemplated that the provision could be interpreted as simply allowing the spread to be moved forwards or backwards by one hour without extending it, but rather whether the spread of hours could be extended by one or two hours. The Ai Group referred in this respect to a number of examples of witness statements and submissions which referred to extensions to the spread of ordinary hours. It also referred to a leaflet distributed by the AMWU to its members about this case which referred to the PIAA seeking a provision to allow an “extension” in the award span from 7.00am-6.00pm to 6.00am-6.00pm. The decision of Marsh SDP issued on 5 August 1999,9 in which she decided to include a facilitative provision allowing the spread of hours in the Graphic Arts - General - Award 2000 to be extended at one end only, did not use the wording in the Metals Award 1998 to avoid uncertainty about the meaning of the expression “either end” but rather made express reference to “one end of the spread (but not both)”. This was demonstrative, the Ai Group submitted, of a common understanding of the industrial parties and the AIRC that the facilitative provision inserted into the Metals Award 1998 allowed for an extension in the award spread of hours – not simply a movement forwards or backwards by an hour.

[17] In relation to matter (c) in the December 2019 direction, the Ai Group said that clauses allowing for 12 ordinary hours to be worked in a day or shift were introduced into the Metals Award 1984 by an AIRC order on 12 April 1990 10 in tandem with provisions extending the spread of ordinary hours which may be worked to 12 (from 7.00am-6.00pm to 6.00am-6.00pm). The 12-hour shift provision did not expressly provide for a paid meal break requirement but one was required for day workers because the span of hours was not sufficiently wide enough to accommodate an unpaid meal break and, in relation to non-continuous shift workers, the Ai Group submitted that the requirement for agreement with relevant unions to introduce 12 hour shifts typically resulted in a paid meal break being introduced. The Ai Group also referred to the simplified version of the facilitative 12-hour shift provision introduced by agreement during the Metal Industry Award Simplification Case, which required that adequate breaks be provided but left the issue of whether meal breaks would be paid or unpaid to be agreed upon at the enterprise level. At this time, the Ai Group submitted, the MTIA/Australian Chamber of Manufactures was pursuing a facilitative provision which would allow an extension in the 12-hour spread of hours for day workers which, if achieved, would address the problem which had existed since April 1990 of paid meal breaks needing to be provided on 12-hour days for day workers because of the inadequate width of the spread of hours. This history, it submitted, highlights the critical importance of the Manufacturing Award continuing to provide for the span of hours to be extended by agreement, not just moved forwards or backwards.

[18] In relation to matter (d), the Ai Group referred to a variation made by an AIRC Full Bench to the Graphic Arts Award 1977 in 1991 11 which introduced a provision to the effect that “Notwithstanding award provisions an employee may work ordinary hours outside the span of hours and/or in excess of 10 hours and up to 12 hours.” This demonstrates, it was submitted, that the AIRC had an appreciation of the conflict which potentially arises between clauses setting a spread of ordinary hours of less than 12 hours and clauses allowing for 12 hour days/shifts to be worked. As to matter (e), the Ai Group provided a comprehensive response to Exhibit AMWU1 which, it contends, demonstrates that “the AMWU’s arguments in AMWU1 do not stand up to scrutiny”. We do not propose to attempt to summarise the Ai Group’s response.

[19] As to matter (f), the Ai Group referred back to its responses to matters (a), (b), (c), (d) and (e), and submitted that the facilitative hours provisions in the Metals Award 1998, the Ai Group/MTFU draft award of 1 August 2008 and the current Manufacturing Award are almost exactly the same.

AMWU response to the Ai Group’s submissions

[20] In response to the Ai Group’s submissions, the AMWU submitted that:

•  it agreed with the Ai Group’s response concerning matter (a) in the December 2019 direction;

•  in relation to matter (b), the Alteration clauses refer to an “alteration” and not an “extension” of the span of hours, and the fact that some individuals used the word “extension” when describing the Alteration clause during the award simplification proceedings cannot change the text of the clause and should be disregarded;

•  the extract from the submissions of Mr Oliver for the MTFU (see paragraph [15] above) relied upon by the Ai Group needs to be read in context, in that he was referring to 5.00am and 7.00pm being the “finer limits” of a spread that could move backwards or forwards by one hour;

•  Mr Smith, representing the MTIA, had made the following statement which is of most assistance in ascertaining the intended operation of the Alteration clause:

“Mr Smith: It may. For example, your Honour, if the spread of hours in a particular place was 6am to 6pm, and in that workplace it made sense, because it was a service facility for service to be carried out between 6pm and 7pm rather than, you know, at the other end of the day, because no-one was there, that they may agree to vary the spread to 7am until 7pm, rather than 6am until 6pm. So there could be some consequences for penalty rates, with varying the spread of hours, but once again all those protections are built in and its not a provision that is intended to focus on that aspect of it.

It is really to say, well, in the current environment that employers are faced with, it may just not make sense for the natural spread for day workers to be 6am until 6pm. I can recall some circumstances were, for example, to take another industry, the office equipment industry, you know, people want their photocopiers serviced between 6pm and 7pm, and no one is in the office between 6am and 7am. So it simply makes sense to vary the spread of hours to be 7 until 7 in that industry. But I am sure there are lots of examples in the metal industry.”

•  although the above extract from the transcript has been raised a number of times in the current proceedings by the AMWU and from the bench, the Ai Group has failed to respond to it;

•  even if the Alteration clause allows for an extension rather than simply a movement back or forward of the span of hours, the decision of Marsh SDP in the Graphic Arts Award Simplification Decision makes it clear that only a one-hour extension and not a two-hour extension was permitted;

•  the witness evidence in the Graphic Arts Award Simplification Case referred to by the Ai Group is not relevant, since it is unclear to what extent this evidence reflects the implementation of award provisions or bargained outcomes;

•  in any event, even if the Graphic Arts Award permits an extension by one hour, which is not conceded by the AMWU, this does not displace the Full Bench’s findings in the August 2019 decision that the Alteration clause in the Manufacturing Award was intended to allow the spread to move as a whole but not to be increased and that there is no utility in a facilitative provision that permits a variation to both ends of the spread of hours in circumstances where an employer cannot require an employee to work the full extended spread;

•  the decision of Marsh SDP in the Graphic Arts Award Simplification Case shows that the intended purpose of the Alteration clause was to allow for early starts and not to facilitate the working of 12-hour shifts;

•  in relation to matter (c), the AMWU agreed that provisions allowing for 12-hour shifts were introduced into the Metals Award 1994 effective from 12 April 1990, and the fact that the span of hours at that time was 6.00am-6.00pm shows that the capacity to work 12-hour days or shifts is not dependent on an ability to use the Alteration clause to extend the spread of hours to 14 hours;

•  in relation to matter (d), the AMWU submitted that the 1991 variation to the Graphic Arts Award 1977 did not assist the Ai Group’s position;

•  in relation to matter (f), the AMWU repeated its submission that provisions dealing with 12-hour shifts are intended to operate independently to the Alteration clause, because they deal with different subject matters;

•  the relevant decisions of the AIRC do not disclose that the introduction of 12-hour shift clauses was for the purpose of allowing day shift workers to work 12.5 or 13-hour days without receiving additional remuneration;

•  most if not all 12-hours shift arrangements are worked as part of a continuous shift roster, meaning that the shift fits into a 12-hour spread;

•  even if this is not the case, there is no reason why an employer and the relevant employees could not agree upon a paid meal break to avoid resolve the issue of an unpaid break pushing the shift beyond the spread of hours;

•  many 12-hour shift workers would be working outside the 12-hour spread in any event because they would be working an afternoon, night or early morning shift and would be entitled to a shift loading;

•  the Ai Group had adduced no evidence to support its contention that the implementation of the provisional view would disrupt many existing 12-hour day work arrangements and that the provisional view is inconsistent with the way employers and employees have applied the Alteration clause for over 20 years;

•  the 12-hour shift issue is a distraction because there is no evidence that the Alteration clauses were introduced to allow 12-hour shifts to be worked, there is no evidence of any work arrangements involving day workers or non-continuous shift workers working a 12.5 or 13 hour day nor any evidence that this was intended and, in any event, the Commission is not restricted in determining the matter to what the original intent of the drafters was;

•  if in fact any 12.5 or 13 hour shift arrangements actually exist, any dispute about them can be resolved using award dispute resolution procedures or by seeking declaratory relief from an appropriate court; and

•  alternatively, if the Ai Group considers that there is a merit case for awards to be varied to prevent a penalty rate applying to any portion of a 12 hour non-continuous shift that falls outside the spread of hours, it should make an application pursuant to s 157 of the Fair Work Act 2009, so that evidence and any merit arguments about this can be properly tested.

[21] The AMWU submitted that we should proceed to vary the relevant awards in accordance with the draft determinations published on 3 September 2019 subject to the amendments proposed in the AMWU’s submission of 20 September 2019.

Consideration

[22] For the reasons which follow, we are not persuaded that we should depart from the provisional view we expressed in the August 2019 decision.

[23] As set out above, the Ai Group has submitted that in respect of 6 of the 11 relevant awards, there is utility in the Alteration clause being construed as allowing for an extension rather than a movement of the span of hours at one end at least, on the basis that this is necessary to allow a 12-hour shift to be worked with an unpaid meal break. The starting point is the Metals Award 1984, as made on 27 April 1984. 12 Clause 18(c) of this award prescribed a span of hours of 7.00am-6.00pm, subject to this proviso: “Provided that the spread of hours may be altered by mutual agreement between an employer and the majority of employees in the plant or section or sections concerned”. A proviso to the span of hours stipulation of this nature had previously existed in earlier versions of the Metals Award dating back to 1935.13 Clause 18(d) provided that the ordinary hours of work were not to exceed 10 in any day, provided that where they were to exceed 8 in any day, the arrangement was to be the subject to the agreement of the employer and the majority of employees in the plant or section or sections concerned.

[24] The first relevant event in the history is that, on 12 April 1990, the AIRC (Keogh DP) varied the Metals Award 1984, by consent, to introduce a suite of changes pursuant to the structural efficiency principle. 14 These included two changes of relevance. The first is that clause 18(c) was deleted and replaced by the following:

(c) The ordinary hours of work prescribed herein shall be worked continuously, except for meal breaks, at the discretion of the employer between 6.00 a.m. and 6.00 p.m. Provided that the actual ordinary hours of work shall be determined by agreement between an employer and the majority of employees in the plant or work section or sections concerned.

Provided further that work done prior to the spread of hours fixed in accordance with this subclause for which overtime rates are payable shall be deemed for the purpose of this subclause to be part of the ordinary hours of work.

[25] Thus, it appears, a wider span of hours was introduced in conjunction with a removal of the longstanding facilitative provision concerning alteration to the span of hours.

[26] Second, clause 18(d) was modified to add the following additional proviso concerning the working of 12-hour days:

(ii) by arrangement between an employer, the union or unions concerned and the majority of employees in the plant or work section or sections concerned, ordinary hours not exceeding twelve on any day may be worked subject to:

(1) the employer and the employees concerned being guided by the occupational health and safety provisions of the ACTU Code of Conduct on twelve hour shifts;

(2) proper health monitoring procedures being introduced;

(3) suitable roster arrangements being made; and

(4) proper supervision being provided.

[27] The conjunction of the introduction of a 12-hour spread of ordinary daily hours, the removal of the facilitative provision for the alteration of the spread of hours, and the introduction of the facilitative provision concerning working 12-hour days, demonstrates that it was not intended that the span of hours necessarily accommodate 12 hours of work plus an unpaid meal break introduced pursuant to clause 18(d)(ii). Indeed, the second proviso to clause 18(c) expressly contemplates that ordinary hours might be performed outside the prescribed spread and attract the overtime rate.

[28] The next event was the addition of the Alteration clause to the Manufacturing Award by the AIRC (Marsh SDP) in the Metal Industry Award Simplification Decision. 15 As we stated in the November 2018 statement, that decision is not of assistance with respect to the interpretation of the Alteration clause.16 However, some of the submissions placed before the AIRC are indicative of the practical work which the MTIA, the moving party for the inclusion of the Alteration clause, intended it to have. In the proceedings, the representative for the MTIA illustrated the intended operation of the provision this way:

“Mr Smith: It may. For example, your Honour, if the spread of hours in a particular place was 6 am to 6 pm, and in that workplace it made sense, because it was a service facility for service to be carried out between 6 pm and 7 pm rather than, you know, at the other end of the day, because no-one was there, that they may agree to vary the spread to 7 am until 7 pm, rather than 6 am until 6 pm…” 17

[29] The representative of the MTIA also said at a later stage of the proceedings in reply to submissions made by the MTFU:

“The second issue relates to some comments made by the MTFU on page 203 of the transcript - I think it was Ms Taylor who was referring to MTIA’s proposed provision in 6.1.1, to permit the spread of hours for day workers to be varied by agreement. She was also referring to our proposed provision in 6.2.1, to permit the shift definitions to be altered by agreement. An example was given of an employee agreeing to a variation in the spread of hours,
enabling he or she to commence work at 5 am, rather than at 6 am, and the Commission was invited to ask itself: who does this benefit?

It is our submission, that such flexibility is often sought by employees. In our experience there are many employees who would prefer to commence work at 5 am and finish at, say, 1 pm, rather than adopt more traditional work patterns. Employees commencing at 5 am are able to avoid travelling during peak times and are often able to more effectively deal with family responsibilities. For example, they may be able to pick their children up from school and avoid the need for child-care in the afternoon.

. . .

And, obviously, such work patterns do not suit all employees or all companies, and for that. reason, under MTIAs proposals the spread of hours and shift definitions can only be altered by agreement - and we do not think that is unfair.”¹⁸

[30] The first extract above suggests that the intention of the facilitative clause was to permit the spread of hours to be shifted rather than extended beyond a total of 12. The second extract illustrates the Alteration clause being used to facilitate an earlier starting time where that suits the convenience of the employee, while maintaining an 8-hour working day. There is nothing in the record of the proceedings which suggests that the MTIA indicated to the AIRC that the Alteration clause was necessary, or could be used for the purpose of, the introduction of a working day consisting of 12 hours of work and an unpaid break. The submissions of the MTIA are significant because it is clear from the relevant part of the Metal Industry Award Simplification Decision that it was the MTIA proposal which was being adopted. Statements made by other parties or witnesses in the proceedings indicative of their understanding of the Alteration clause, or the contents of publicity documents about the proceedings published by parties, are of little weight because they are entirely subjective in nature and in any event are generally ambiguous.

[31] That the Alteration clause and the 12-hour day facilitative provision were envisaged to operate independently and not in conjunction with each other is confirmed by the fact that the former allowed for both collective and individual agreement, whereas the latter only allowed for collective agreement. Thus an individual could not agree to an alteration to the spread of hours and simultaneously agree to a 12-hour working day with an unpaid break.

[32] The above conclusion as to what was envisaged to be the practical purpose of the Alteration clause is confirmed by the subsequent decision of Marsh SDP in the Graphic Arts Award Simplification Decision, as we explained in the November 2018 statement. 19 Reference may also be made to the following passage in that decision:

“[139] These are new paragraphs proposed by the employers. The union opposed their adoption primarily on the basis that the facilitative clause would result in a loss of entitlement either in the form of the shift allowances or of overtime. For example, the union submitted in relation to Mr Patrick's evidence:

"If Mr Patrick wants to start early to enhance productivity, he could start prior to 7 am and pay the appropriate shift loading.

If this is not a consistent requirement, he could start prior to 7 am and pay overtime." [Tpt 454]

[140] The focus of the material was "early starts". A reason given for the requirement for an early start was to overcome an inhibition on productivity caused by the 7:00am start [see for example Mr Hollister's sworn statement par6]. The employers relied on evidence that it was in the interest of the employees to commence work earlier (for convenience) [see Mr Boshell sworn statement par7, Mr Rew Tpt 332, Mr Trappel Tpt 244, Mr Patrick sworn statement par4, 8, 9 Mr Boshell sworn statement par7]. There was no evidence produced which demonstrated the circumstances in which the morning shift penalty, payable for the whole shift, is paid to employees asked to start work 1 hour earlier than the 7:00am start for day work.

[141] Mr Patrick in his statement attested:

"On several occasions at an employee's request we have changed the starting and finishing time to fit in with the employee's travel arrangements so they do not have their wages reduced because of transport difficulties." [par7]

[142] The requirement to pay a morning shift penalty for an entire shift when an extra hour's work is required is in my view a restriction under Item 51(6)(c) because an efficient allocation of work as access to an early start is inhibited by the obligation to pay the penalty. The same effect results to a lesser extent from the overtime requirement. Productivity may be restricted or hindered. In circumstances where an employee wants to start early fairness to employees is not affected. The evidence demonstrates that early starts do occur by informal agreement:

"It is not an unreasonable thing, is it, if both parties want to start at 6 am?---It's not unreasonable but as the situation is at the moment the employer, if he agrees to do that without some formal recognition of that, is leaving himself wide open for prosecution at a later date and as I said earlier, particularly in Western Australia in the summer you can come to an agreement with an employer to start at 6 for no extra penalty rates and when they have a falling out of the wage down the road, he comes to us or the Department of Industrial Relations and says: I've never received a shift loading for the last 12 months." [Mr Trappel Tpt265]

"...and the company are now working the roster that those people wanted to work and I think, from memory, it was to facilitate the daylight hours during the heat of summer which enabled them to start earlier on a couple of shifts." [Mr Trappel Tpt 244]”

[33] We note that the Alteration clause was adopted into other awards which have never had a 12-hour working day facilitative provision.

[34] The Ai Group asserts, as we understand it, that some and perhaps many employers have used the Alteration clause to implement 12-hour working day arrangements with an unpaid break. The AMWU and the CFMMEU deny that this is the case. It is impossible to take this matter any further in the absence of evidence except to say that if this has occurred, it is not in accordance with what we identify as the intended purpose of the Alteration clause. Further, if any such arrangements exist, they can be continued by way of the payment of half an hour or an hour’s pay at the rate of time and a half, 20 or through individual flexibility arrangements, or through an enterprise agreement. As to the other examples of the way in which the Ai Group contends the Alteration clause can be used under the Pharmaceutical Industry Award, the Storage Services Award or the Clerks Award, these appear to us to be more theoretical than real. And, in relation to the Clerks Award, we do not consider that the Alteration clause was ever intended to be used for avoiding Saturday penalty rates when more than half a day is worked.

[35] We reject the AMWU’s submission that the qualifying expression “in appropriate circumstances” in respect of individual agreement under the Alteration clauses in the Manufacturing Award, the Food Manufacturing Award, the Seafood Processing Award or the Sugar Industry Award should be retained. This qualification is too broadly and vaguely expressed and does not establish any discernible criteria which can be applied in practice.

[36] The 11 awards will be varied in terms consistent with the draft determinations 21 published in conjunction with the September 2019 statement. The operative date will be 1 July 2021.

PRESIDENT

Appearances:

Mr G Miller and Mr N Grealy, on behalf of the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) and Australian Workers’ Union.
Ms E Barnes-Whelan, on behalf of the Construction, Forestry, Maritime, Mining and Energy Union (Construction & General Division).
Mr B Ferguson and Mr H Harrington, on behalf of the Australian Industry Group.
Ms P Thomson, on behalf of Australian Business Industrial.

Hearing details:

2020.
Sydney (Melbourne via video-link):
28 November.

Final written submissions:

Australian Industry Group – 21 February 2020.
“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union – 27 March 2020.

Printed by authority of the Commonwealth Government Printer

<PR730719>

 1   [2019] FWCFB 5409

 2   [2019] FWCFB 6060; draft variation determinations

 3   Print R7898

 4   [2018] FWCFB 6849

 5   Metal Industry Award 1984, cl 18(c)

 6   The Metal Trades Industry Association of Australia and the Australian Chamber of Manufactures

 7   Print P9311

 8   C No. 20241 of 1997 and C No. 00561 of 1998

 9   Graphic Arts Award Simplification Decision, 5 August 1999, Print R7898

 10   Print J2043

 11   Print J8236

 12   Print F4869

 13   See Re Metal Trades (1935) (1935) 34 CAR 449 at 475; the award prescribed in clause 8 a span of hours 7.00am-5.30pm Monday to Friday and 7.00am-noon on Saturday “Provided that the spread of hours herein prescribed may be altered by mutual agreement between an employer and his employees”.

 14   Print J2043

 15   Print P9311

 16   [2018] FWCFB 6849 at [12]

 17   Transcript, 22 December 1997, p.172

18    Transcript, 19 February 1998, p.359

 19   At [12]-[15]

 20   Assuming employees are paid at award rates. If employees are paid at above-award rates, it may be that no pay adjustment is necessary at all provided that the above-award payment is expressed to compensate for all award entitlements.

 21   Schedule of draft determinations - Spread of hours clauses