Fair Work Act 2009

s.318 - Application for an order relating to instruments covering new employer and transferring employees

Cement Australia Pty Limited Trading AS Cement Australia

Application for an order relating to instruments covering new employer and transferring employees.

• [1] Cement Australia Pty Limited T/A Cement Australia (Cement Australia) has made an application pursuant to s.318 of the Fair Work Act 2009 (Cth) (the Act) seeking the following Orders:

1. Pursuant to s.318(1)(a) of the Act, the Hanson's TWU Melbourne Metropolitan Area Truck Driver Agreement 2023 - 2026 (Hanson Agreement) (or any other

successor agreement), being a transferable instrument that would, or would be likely to, cover the Applicant and its employees previously employed by Heidelberg

Materials Australia Pty Ltd, does not, and will not, cover Cement Australia or any employee of Heidelberg Materials who:

(b) is employed in the role of Tanker Driver; and

i. has accepted an offer of employment with Cement Australia; or

ii. has not accepted an offer of employment with Cement Australia as at

the date of this Application, but in the future accepts an offer of

in respect of their employment with Cement Australia.

1. Pursuant to s.318(1)(b) of the Act, the Cement Australia Pty Limited Transport Employees (VIC) Enterprise Agreement 2024 (or any successor agreement) (Cement Australia Agreement) covers the Transferring Employees in respect of their employment with Cement Australia;

• [2] For the reasons set out below, I am satisfied that it is appropriate to make the Orders sought pursuant to s.318(1) of the Act.

• [3] The Form F40 - Application for orders in relation to a transfer of business (Form F40) filed by Cement Australia relevantly outlined the background to the application, and I will briefly relay this background here.

• [4] Cement Australia supplies cement products and services in Australia. Cement Australia is a joint venture of two shareholders of equal ownership. The first shareholder is two subsidiaries of Heidelberg Materials AG (Heidelberg Materials), being Hanson Cement Holdings Pty Ltd and Hanson Australia Investments Pty Ltd (Hanson Australia). The second shareholder is Holcim (Australia) Pty Limited. Hanson Australia and Cement Australia are not associated entities.

• [5] Both Heidelberg Materials and Cement Australia employ drivers to undertake product delivery work. In particular, Heidelberg Materials employs agitator drivers, cement tanker drivers and tipper drivers to undertake customer delivery work. Cement Australia says that as part of a broader transaction, Cement Australia and Heidelberg Materials have agreed that:

• Cement Australia will accept the transfer of 20 Heidelberg Materials tankers to undertake customer delivery work, with ownership of the tankers to transfer to Cement Australia from April 2025 to August 2025;

• Cement Australia will take over from Heidelberg Materials, the customer deliveries work; and

• Heidelberg Materials will second 12 of its tanker drivers to Cement Australia to perform the customer delivery work.

• [6] Cement Australia says that the customer delivery work commenced on 19 May 2025, and has been performed by employees of Cement Australia, and that the tankers which were transferred have been used by Cement Australia and its employees, including for some of the customer delivery work. In its Form F40, Cement Australia also notes that Heidelberg Materials has commenced its secondment of 12 drivers to Cement Australia to support Cement Australia with the customer deliveries.

• [7] With respect to these seconded drivers, Cement Australia submitted that by on, or around, 23 June 2025, offers of employment had been made to six out of the 12 employees seconded from Heidelberg Materials to Cement Australia who were performing the customer deliveries work. Cement Australia says that these offers stated that employment was due to commence on 1 September 2025, or earlier by agreement. Cement Australia also submitted that it intends to make offers of employment to the six remaining seconded employees, once they had cleared their relevant pre-employment checks. At the date of filing the Form F40, the aforementioned six employees had formally accepted Cement Australia's offer to commence employment on 1 Settlement 2025.

• [8] In its Form F40, Cement Australia submitted that the offers of employment made to the seconded Heidelberg Materials employees: were on terms and conditions no less favourable overall than their terms and conditions with Heidelberg Materials under the Hanson Agreement (and in some respects, more favourable); would recognise continuous service with Heidelberg Materials for all purposes; and confirmed to these employees that Cement Australia would be making an application under s.318 of the Act for an order that the Cement Australia Agreement would apply to their employment with Cement Australia, and that the Hanson Agreement would not apply.

• [9] Section 318 of the Act states as follows:

318 Orders relating to instruments covering new employer and transferring employees

(a) an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a) does not, or will not, cover the new employer and the transferring employee;

(b) an order that an enterprise agreement or a named employer award that covers the new employer covers, or will cover, the transferring employee.

(2) The FWC may make the order only on application by any of the following:

(a) the new employer or a person who is likely to be the new employer;

(b) a transferring employee, or an employee who is likely to be a transferring employee;

(c) if the application relates to an enterprise agreement - an employee organisation that is, or is likely to be, covered by the agreement;

(d) if the application relates to a named employer award - an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (b).

(3) In deciding whether to make the order, the FWC must take into account the following:

(i) the new employer or a person who is likely to be the new employer; and

(ii) the employees who would be affected by the order;

(b) whether any employees would be disadvantaged by the order in relation to their terms and conditions of employment;

(c) if the order relates to an enterprise agreement - the nominal expiry date of the agreement;

(d) whether the transferable instrument would have a negative impact on the productivity of the new employer's workplace;

(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument covering the new employer;

(f) the degree of business synergy between the transferable instrument and any workplace instrument that already covers the new employer;

Restriction on when order may come into operation

(4) The order must not come into operation in relation to a particular transferring employee before the later of the following:

(a) the time when the transferring employee becomes employed by the new employer;

• [10] Cement Australia submits that the transfer of employees from Heidelberg Materials to Cement Australia is likely to constitute a 'transfer of business' pursuant s.311(1) of the Act for the following reasons:

• The Transferring Employees have or will terminate their employment with Heidelberg Materials.

• Within 2 months following the termination, the Transferring Employees will, or are likely to, commence employment with Cement Australia.

• The work the Transferring Employees will, or are likely, to perform for Cement Australia is the same or substantially the same as the work the Transferring Employees performed for Heidelberg Materials. In this respect, Cement Australia says that the Transferring Employees will be employed as tanker drivers, and will deliver to some of the same sites they delivered to when employed by and driving for Heidelberg Materials.

• Cement Australia also says that there is a connection between Heidelberg Materials (the old employer) and Cement Australia (the new employer). It says that it will own or have the beneficial use of some, or all, of the tankers used to undertake customer delivery work, of which Heidelberg Materials had ownership or beneficial use of, and that there has therefore been a transfer of assets pursuant to s.311(3) of the Act.

• [11] For the purposes of s.311(1) of the Act, I am satisfied that there has been a transfer of business. I am also satisfied that each of Transferring Employees are transferring employees within the meaning of s.311(2) of the Act.

• [12] Cement Australia also submits that the Transferring Employees were covered by the Hanson Agreement and that the Hanson Agreement is a transferrable instrument pursuant to s.312 of the Act. Cement Australia says that as there has been a transfer of business, s.313(1)(a) of the Act is likely to apply and that in the absence of the Orders sought, the Hanson Agreement would cover the Transferring Employees in their employment with Cement Australia. Cement Australia also submits that the Cement Australia Agreement covers Cement Australia and its employees with respect to the work to be performed by the Transferring Employees.

• [13] I will now consider the factors under s.318(3) of the Act in determining whether to make the Orders sought.

Section 318(3)(a) The views of Cement Australia and of the employees affected by the Orders

• [14] Cement Australia seeks the Orders so as to standardise employment conditions so that all of its employees, Transferring Employees and Non-Transferring Employees, who will be performing the same or substantially similar work in Victoria are governed by the same industrial instrument. It says this will:
  • create employment simplicity with the application of one industrial instrument,
  • create operational synergies with respect to standard shift durations,
  • minimise disharmony within the workforce, compared to if two different terms and conditions were to apply, and
  • would be less administratively burdensome.

• [15] With respect to ascertaining the views of the Transferring Employees, Cement Australia says that the Transferring Employee also received with their offer of employment, a document comparing the key terms of the Cement Australia Agreement and the Hanson Agreement (Comparison Document). A copy of this document was filed with the Commission along with the Form F40.

• [16] The six Transferring Employees who have accepted offers of employment were asked to confirm in writing as to whether they consent to, or were supportive of, the s.318 application made by Cement Australia. As part of the application, Cement Australia attached screenshots of correspondence from three of the six Transferring Employees who confirmed, in correspondence to Cement Australia, that they consent or were supportive of the application.

• [17] As part of the conduct of this matter, I issued Directions for the filing of material. These Directions required Cement Australia to serve on all Transferring Employees a copy of the Form F40 and supporting documents filed with the Form F40. These Directions provided the opportunity for any Transferring Employees, and any employee organisation which ordinarily represents the industrial interests of the Transferring Employees, to file any material which addressed certain factors under s.318(3) by 30 July 2025. The parties also had until 6 August 2025 to advise the Commission if they wanted to be heard in relation to the application.

• [18] No material was filed by the Transferring Employees in accordance with the Directions.

• [19] The Transport Workers' Union of Australia (TWU), in correspondence to Chambers on 30 July 2025, submitted that it has no objection to this application. In its correspondence, the TWU also said that Cement Australia had committed to extending a retention bonus to 2027 and had also committed to recognising an additional TWU delegate to represent workers transferring from Heidelberg Materials.

• [20] I am satisfied that the Transferring Employees have had the opportunity to provide their views on the application. I note that the TWU does not oppose the Orders sought and that no opposing views have been filed with the Commission. I therefore consider that the views before the Commission weigh in favour of making the Orders.

Section 318(3)(b) Whether any employees would be disadvantaged by the Orders in relation to their terms and conditions of employment

• [21] Cement Australia says that Transferring Employees will not be disadvantaged in relation to their terms and conditions of employment should they be covered under the Cement Australia Agreement.

• [22] I note that Heidlberg Materials is paying some Transferring Employees rates of pay that are above the Hanson Agreement rates, and above the rates in their employment contracts, such as the night shift penalty of 30% applied to afternoon shift workers, and with respect to some Transferring Employees who are being paid at the Grade 8 Classification despite working at the Grade 6 Classification. Cement Australia says that these higher rates are not entitlements under the Hanson Agreement, nor are they contractual entitlements. It says these are instead voluntarily paid at the discretion of Heidlberg Materials. Cement Australia submits that they will continue to apply these additional rates and payments until 30 June 2026.

• [23] I have considered the Comparison Document filed with the Commission, and both the Hanson Agreement and Cement Australia Agreement. I also note that the Cement Australia Agreement incorporates the Road Transport and Distribution Award 2020.

• [24] With respect to rates of pay, I note that the base rate is higher under the Cement Australia Agreement than under the Hanson Agreement for the relevant classifications.

• [25] In considering the terms and conditions of the Hanson Agreement and Cement Australia Agreement, I am satisfied that employees would not be disadvantaged in relation to their terms and conditions of employment. I therefore consider that this factor weighs in favour of granting the Orders sought.

Section 318(3)(c) The nominal expiry date of the Hanson Agreement

• [26] The nominal expiry date of the Hanson Agreement is 30 June 2026. I do not consider that this factor weighs against the granting of the Orders sought.

Section 318(3)(d) Whether the Hanson Agreement would have a negative impact on the productivity of the new employer's workplace

• [27] Cement Australia says that the Hanson Agreement would cause a negative impact on the productivity of its workplace if the Orders sought were not made. It says that Cement Australia:

• Would be required to manage the coordination of different rostering practices (with variations in start time, standard shift lengths, accruals of rostered days off and overtime arrangements);
• Would be required to invest a significant amount into onboarding the Hanson Agreement to work with Cement Australia's payroll systems;
• Would be required to invest in 'large scale' training programs to upskill the human resources, payroll and accounting staff as well as the operations team to understand the terms and conditions of the Hanson Agreement;
• Would be required to maintain two separate time sheeting activities across the Victorian Distribution team, which will create additional administrative burdens, and will also create the potential for increased risk due to inaccuracies and payroll errors; and
• Would be required to maintain two significantly different sets of terms and conditions for the Victorian Distribution team and that, for the Transferring Employees, this would lead to different and inferior conditions with respect to pay rates, as compared to the rest of Cement Australia's employees transporting and delivering cement to the Victorian region.

• [28] Cement Australia also says that due to the administrative and cost burdens of maintaining two industrial instruments and maintaining two rostering, payroll and IT systems, that there would be productivity benefits which flow from having a single instrument covering Cement Australia's workforce. It also says that productivity benefits would flow from averting the administrative and compliance burden on Regional Transport Managers if they had to understand and adopt two separate industrial instruments.

• [29] I accept these submissions. On the material before me, I am satisfied that if the Orders sought were not made, that the application of the Hanson Agreement would have a negative impact on Cement Australia's productivity. I am satisfied that these additional administrative and cost burdens associated with the operation of a secondary enterprise agreement would negatively impact Cement Australia's productivity. I therefore consider that this factor weighs in favour of granting the Orders sought.

Section 318(3)(e) Whether Cement Australia would incur a significant economic disadvantage as a result of the Hanson Agreement covering Cement Australia

• [30] Cement Australia relies on the factors outlined above to say that if the Hanson Agreement were to cover it, then it would incur significant economic disadvantage due to having to incur additional expenses from the application of the Hanson Agreement. It says that operational efficiencies would also be minimised and that it would be exposed to significant payroll compliance complexities.

• [31] Whilst I accept the submissions of Cement Australia that there would be some economic disadvantage, I am not satisfied that Cement Australia would incur significant economic disadvantage. I consider this factor to be neutral in the consideration of whether the Orders sought should be made.

Section 318(3)(f) Degree of business synergy between Hanson Agreement and Cement Australia Agreement

• [32] On this factor, Cement Australia says that although some limited business synergy exits between the Cement Australia Agreement and the Hanson Agreement, this is only because both agreements relate to tanker-based work. Cement Australia says that the two agreements otherwise provide for different employment conditions. I agree.

• [33] I find the degree of business synergy to be a neutral factor in determining whether the Orders should be made.

• [34] This factor is informed by the objects of Part 2-8 of the Act, as stated under s.309 of the Act. More specifically, the public interest criterion requires that I consider the balance between the protection of employees' terms and conditions of employment under the enterprise agreements, with the interests of employers in running their enterprise efficiently.

• [35] Cement Australia says that that maintaining a 'cohesive, harmonious and productive workplace' is a matter of public interest.[1] It also says that its interest in enhancing productivities is aligned with the interests of Transferring Employees, as the Cement Australia Enterprise Agreement provides for terms and conditions which are no less favourable overall, and in some cases more favourable, than those under the Hanson Agreement.

• [36] I do not consider that it is contrary to public interest to grant the Orders sought. However, in the circumstances, I also do not consider that this factor carries any particular weight where the considerations and submissions referred to in this Decision have not been disputed between the parties. As such, I consider that this factor is a neutral consideration in terms of whether the Orders sought should be granted.

• [37] Having considered the matters above, the factors pursuant to s.318(3) of the Act either weigh towards the granting of the Orders or are neutral. I am satisfied that, in light of the factors considered above, that the Orders sought should be granted. An Order[2] to this effect will be issued with this Decision.

[2] PR791975.

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