Grill'd Pty Ltd [2025] FWC 1275 (8 May 2025)

Application for approval of the Grill'd Enterprise Agreement 2024

• [1] In a Decision dated 17 April 2025,[1] I dealt with an application for approval of an enterprise agreement known as the Grill'd Enterprise Agreement 2024 (the Agreement). The application was made by Grill'd Pty Ltd. I determined that I could not approve the Agreement as I was not satisfied that Grill'd had taken all reasonable steps to explain the terms of the Agreement, and their effect, to its employees as required by s180(5) and (6) of the Fair Work Act 2009 (Cth). Grill'd was invited to consider whether it wished to proffer further undertakings.

• [2] In addition to the 16 undertakings already proffered, Grill'd has now proposed 4 new undertakings and amended 2 of the earlier undertakings; encompassing 20 undertakings in total.[2]

• [3] The Shop, Distributive and Allied Employees Association (SDA) and United Workers' Union (UWU) both filed responsive submissions, contending that the undertakings offered should not be accepted and that the application for approval of the Agreement should be dismissed.[3] Grill'd filed submissions in reply to the unions' submissions, contending that the Agreement should be approved.[4]

• [4] In my initial Decision my findings included that:

• a) The Agreement passed the Better Off Overall Test, although barely for some employees in light of the 'outer limits' modelling provided by Grill'd, which showed that in financial terms, employees could be as little as $0.77 cents per week (and a median of $4.89 per week) better off under the Agreement at the test time than under the Fast Food Industry Award 2020 (the Award);[5]

b) Grill'd did not take all reasonable steps to explain the effect of the terms of the Agreement dealing with wage rates for work between 10:00 pm and 6:00 am and on public holidays, in particular that there was no explanation that, unlike the Award, the rates under the Agreement remained static, nor the consequences or effect that flow from that;[6]

• c) The explanation provided by Grill'd was inadequate in not including any information concerning the location of work, the reimbursement of travel time and fares under the Award, and the omission of accident make-up pay;[7]

• d) The explanation provided by Grill'd was inadequate and did not explain the effect of the terms of the Agreement concerning the rate of pay for work performed on weekend days and evenings between 6:00 am and 10:00 pm; [8] and

• e) Grill'd did not take all reasonable steps to explain the effect of the terms of the Agreement through the overall and cumulative picture created by the selection, omission and presentation of the explanation provided to employees, in the particular circumstances involving a high proportion of young people with limited experience and knowledge, very high turnover of staff, and the small positive wage rate margin provided under the Agreement.[9]

• [5] The further and amended undertakings proffered by Grill'd are:

• Amended Undertaking 5: now applies to both a Team Member and a Team Leader. It confirms that the weekday hours for work performed on the weekend will not include a public holiday;

• New Undertaking 8: to increase Saturday and Sunday work hourly wage rates by $1 more per hour to the former hourly wage rates, with a proportionate increase to juniors and trainees);

• Amended Undertaking 10: to give Non-Salaried Employees travelling time reimbursement and transport of employee reimbursement as per the Award, in addition to the existing excess travelling costs entitlement;

• New Undertaking 14: increased rates for work performed by Non-Salaried Employees on a public holiday by $1 more per hour to the former hourly wage rates, with a proportionate increase to juniors and trainees);

• New Undertaking 16: to give a 1% wage increase to the hourly rates contained in clause 19 (penalty rates) and clause 28 (public holidays) on the first full pay period in July each year, commencing in July 2025; and

• New Undertaking 20: amendment to the Agreement to include Accident Pay as per the Award.

• [6] In relation to the inadequacy of the explanation provided by Grill'd relating to location of work, travel and accident make-up pay, I am satisfied that Amended Undertaking 10 and New Undertaking 20 address these concerns.

• [7] The further and amended undertakings were accompanied by updated 'outer limits' modelling and explanation. The cumulative effect of the further and amended undertakings is that in financial terms, an employee could be as little as $3.10 per week (and a median of $10.89 per week) better off under the Agreement at the test time than under the Award. Absent these undertakings, employees could be as little as $0.77 cents per week (and a median of $4.89 per week) better off. Grill'd submits that this more generous offering demonstrates that employees are significantly better off overall compared to the Award. Grill'd contends that the further and amended undertakings address the concerns regarding compliance with s180(5) and (6) of the Act that were found in the Decision and have a curative effect, and that this "is a fundamental positive change to the cumulative picture to which the Commission had regard in expressing its concern."

• [8] The key submission made by the SDA and UWU in response, is that they do not. They contend that addressing the concerns in the Decision about the explanation of the effect of the terms of the Agreement relating to rates of pay required undertakings that the relevant Agreement rates would be increased in line with any adjustment of the relevant rates under the Award.

• [9] I agree with Grill'd that the decision in SDAEA v Allen Family Pty Ltd[10] does not establish a rule that any inadequacy in explaining where an agreement provides less benefits than the comparator award can only be remedied by an undertaking that removes that specific detriment. I also agree that a flaw in the explanation process may not, when considering all the circumstances, mean that the agreement was not genuinely agreed to; considering the issue occurs in the context of how convincingly the Better Off Overall Test has been passed.[11] For example, an undertaking to increase the rates of pay to a level that would encompass any likely increases in the Award rates would likely address the concerns. Similarly, an undertaking (that is not infrequently offered) to conduct a reconciliation to ensure that employees earn at least as much as they would have under the Award, would likely address the concerns.

• [10] The question to be determined is whether the further and amended undertakings address the concerns I expressed in the Decision about the adequacy of the explanation provided to employees covered by the Agreement. This is an evaluative exercise and not the application of a precise mathematical formula. The exercise becomes easier and clearer in circumstances such as these, as the scale of the positive margin under the Agreement vis-à-vis the Award increases. Here, the positive margin against the Award has been increased. However, not to such a degree that it resolves the concerns expressed in the Decision. It remains the case that employees can be engaged under the Agreement for only $3.10 and a median of $10.89 per week above the Award. The Agreement passes the Better Off Overall Test only slightly more convincingly than I found to be the case in the Decision. In my view, the increased offering does not sufficiently address the findings in my Decision, as set out in paragraph [4] above. The median positive margin continues to be at a level that is likely to be eroded by increases in the Award rates over the 4-year nominal life of the Agreement. In those circumstances, and in light of the profile of the employees who would be covered by the Agreement, and the very high levels of staff turnover, I am not satisfied that Grill'd has complied with s180(5) and (6) of the Act. My overall assessment is that Grill'd did not take all reasonable steps to explain the terms of the Agreement, and their effect, to its employees.

• [11] The application for approval of the Grill'd Enterprise Agreement 2024 is dismissed.

[1] [2025] FWC 1097.

[2] Amended Grill'd Aide Memoire Explanation of Amended and Further Undertakings, 28 April 2025.

[3] Submissions/views of United Workers Union and Shop, Distributive and Allied Employees Association - Amended and Further Undertakings, 1 May 2025; Email 1 May 2025 from Ali Amin, SDA.

[4] Grill'd Submissions in Reply, 2 May 2025.

[6] Decision at [43], [46]. Clause 19 of the Agreement provides for a higher hourly rate of pay between 10:00 pm and 6:00 am, whereas the undertaking offered amends this so that an increased rate of pay applies to work between midnight and 6:00 am. Accordingly, the undertaking appears to provide for a higher rate but for a shorter period of time.

[10] [2024] FWCFB 48.

[11] Grill'd Submissions in Reply at [3].

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