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[2020] FWC 1388
plaintiff. The Commission answered all three arbitration questions in the Applicant's favour: whole-shift afternoon loading applies to shifts rostered to finish after 7:00 pm and before midnight, the cold...
Commissioner Hunt resolved three disputes about how PMFresh applied its enterprise agreement. A qualifying afternoon shift attracted the loading for the whole shift, not just the hours after 7:00 pm. The cold room allowance depended on work in an artificially cooled environment below 4°C, not on whether PMFresh called the room a designated cold room. Part-time employees had to be rostered on regular days and hours, and schedule changes required consultation. The Commission did not decide the temperature of any particular room or day.
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The National Union of Workers, now the United Workers Union, brought a dispute under s 739 of the Fair Work Act 2009 about the application of the Primo Moraitis Fresh Pty Ltd - NUW - Employees - Enterprise Agreement 2016 to employees of PMFresh. The Commission accepted that the dispute could be heard and determined through the Agreement's dispute-resolution procedure: [1], [8].
Commissioner Hunt settled three questions for arbitration. First, whether afternoon shift loading applied only to work between 7:00 pm and midnight, or to all hours of a qualifying shift. Second, whether the cold room allowance applied to work in any artificially cooled environment below 4°C or only in the employer's designated cold rooms. Third, whether part-time employees had to be scheduled on regular days and hours: [9]-[11].
The union's evidence described variable part-time rosters, shifts being changed without direct notice, and workers being asked or directed to work beyond rostered hours: [17]-[21], [34]-[35]. The employer said its production needs varied with customer orders, supply issues, equipment breakdowns and weather, and defended the flexibility of its rostering practices: [74]-[76], [100]-[104].
On afternoon loading, PMFresh relied on inherited payroll rules called the MCK payment rules. Under those rules, afternoon loading generally applied only to hours after 7:00 pm, with an exception for some shifts starting at 2:00 pm or later: [85]-[87]. The Commissioner found these rules were not part of the Agreement: [165].
On the cold room allowance, employees said some processing areas were below 4°C, while PMFresh disputed both the measurement and the applicability of the allowance outside designated rooms: [27]-[30], [81]-[84]. The Commissioner decided the Agreement's interpretation question, but expressly did not determine the actual temperature of particular rooms on particular days: [198]-[202].
The decision answered all three arbitration questions in the union's favour: [186], [197], [232]-[234].
This was a Fair Work Commission decision by Commissioner Hunt, not a court judgment. The construction approach adopted was that enterprise agreements are interpreted by looking first at the ordinary meaning of the words, in the context of the agreement as a whole and its purpose. The decision reproduces the principles stated in Berri, including that surrounding circumstances can assist where text is ambiguous, but cannot be used to rewrite the agreement: [157]. The Commissioner also emphasised that context is relevant even where words initially appear clear: [158]-[159].
For afternoon shift loading, the Commissioner found clause 6.1.5 ambiguous or susceptible of more than one meaning, especially when read alongside clause 6.4: [168]. Read alone, clause 6.1.5 suggested a penalty for hours worked after 7:00 pm, with overtime consequences for hours beyond the roster: [169]-[170]. But clause 6.4 said shift work could be worked by any employee, and contained provisions for afternoon shift loading: [171]. The Commissioner also found that the references in clause 6.4.1(d), (e) and (f) to clause 6.1.5(b) should refer instead to clause 6.1.5(c): [174].
The MCK payment rules could not resolve the interpretation dispute in PMFresh's favour. They were not incorporated into the Agreement, and employees had not been shown them as part of the bargaining process: [163]-[165]. The Commissioner considered the relevant Agreement clauses, the evidence about how the rules had been used, and material concerning the Agreement's approval: [175]-[182]. The resulting construction distinguished a rostered afternoon shift from additional hours worked after 7:00 pm. A shift rostered to finish after 7:00 pm and before midnight attracted loading for all hours until overtime became payable. Where the rostered shift did not finish after 7:00 pm, but the employee agreed to additional hours after that time, loading applied only to those additional hours between 7:00 pm and midnight: [184]-[186].
For the cold room allowance, the Commissioner focused on the operative words in clause 5.5.1: work in “an environment artificially reduced below 4c”, continuously for at least 30 minutes when requested by the employer. The provision also set a minimum payment of four hours a day: [190]. “Cold Room” was treated as a heading, while the sentences that followed described the entitlement: [190]-[192]. Because the clause did not limit itself to employer-designated rooms, the proposed limitation was rejected: [191]-[194]. The Commission answered that there was no requirement for the environment to be a cold room as described by PMFresh: [197].
For part-time scheduling, clause 4.4.2 required regular hours on regular days and said changes to the schedule could occur only after consultation: [4], [209]. The Commissioner did not equate “regular hours” with identical start and finish times on every day. The example given was an employee working three 10-hour days, with different start times on each day. However, the particular days were to be set in advance and could not be changed without consultation: [208]. The Commissioner found that the employer's operational demands did not displace its obligations under the Agreement: [211]. The roster practices described in the decision were found to have treated part-time employees as if they were casual employees, without the certainty the Agreement provided: [212], [230]-[231].
The decision applied the construction principles set out in Berri, a Full Bench decision concerning the interpretation of enterprise agreements: [157]. It also referred to the significance of context as discussed in Endeavour Coal and Mainteck, and to the practical, non-pedantic approach described in Kucks: [158]-[159]. The extract does not establish a general change to the law of enterprise agreement construction. Instead, it applies those principles to the particular wording and evidence concerning this Agreement.
Before the decision, PMFresh had applied its MCK payment rules to determine when afternoon loading was payable. The decision held those rules were not incorporated into the Agreement and could not govern entitlements where they were inconsistent with the Agreement: [160]-[165]. The decision's construction clarified the applicable loading for the shift patterns put in issue: all hours of a shift rostered to finish after 7:00 pm and before midnight, but only qualifying additional hours after 7:00 pm where the shift was not rostered to finish after that time: [184]-[186].
For the cold room allowance, the decision rejected an employer-designation test. On its reading of clause 5.5.1, the relevant criterion was the artificially reduced temperature and the specified period of continuous work, not the employer's label for the work area: [190]-[197]. This did not settle which actual rooms met the temperature threshold at particular times: [201].
For part-time rostering, the decision interpreted “regular days” as the same days each week, selected in advance and changeable only after consultation. It did not require the same start and finish times on each day: [208]-[210]. The decision also considered the Agreement's related provisions, including clause 6.1.4 and Appendix C, in assessing the roster and additional-hours arrangements: [216]-[231]. Its specific determination was that part-time employees must be rostered on regular days and regular hours: [232].
At [184], the Commissioner said that a shift rostered to finish after 7:00 pm and before midnight becomes an afternoon shift that may be worked by any employee. In plain English, the Agreement's classification turns on the rostered finishing time, not solely on whether the employer had separately labelled the employee a shiftworker.
At [186], the Commission set out two outcomes. A qualifying rostered shift attracts loading for all hours until overtime applies. If the rostered shift was not due to finish after 7:00 pm, but the employee agrees to additional hours after that time, loading applies only to the additional hours between 7:00 pm and midnight. This distinction between rostered hours and later additional hours is central to the decision.
At [194], the Commissioner said the only criterion for the cold room allowance was an environment artificially reduced below 4°C for the required period. Put simply, the employer's terminology for a room does not determine the allowance. The relevant factual condition still needs to be established, and the decision did not determine the temperature of particular rooms: [201].
At [208], the Commissioner interpreted regular days as particular days of the week that are regular, meaning the same days each week, subject to consultation about changes. “Regular hours” did not mean that every start and finish time had to be identical. The example showed an employee could start at different times on the different scheduled days.
At [211], the Commissioner acknowledged PMFresh's customer and production pressures but said those considerations could not displace the Agreement's obligations. At [231], the Commissioner characterised the consultation about schedule changes as having been extraordinarily lacking. These passages explain why commercial flexibility did not answer the construction question in the employer's favour.
The afternoon loading reasoning is most directly relevant to a dispute about whether a shift was rostered to finish after 7:00 pm and before midnight, and whether loading should apply to the whole shift or only to hours after 7:00 pm. The decision also distinguishes that scenario from a shift rostered to finish at or before 7:00 pm, followed by agreed additional hours after 7:00 pm: [184]-[186]. It arose under the wording of this Agreement, including its interaction between clauses 6.1.5 and 6.4. Different agreement wording may require a different construction.
The cold room reasoning is relevant where an agreement uses wording like clause 5.5.1, which links an allowance to work in an environment artificially reduced below a specified temperature and sets a minimum period of continuous work. The dispute in this case also shows the importance of separating interpretation from proof: the Commission decided that employer designation was not a requirement, but did not decide whether particular areas were below 4°C at particular times: [191]-[202].
The part-time rostering reasoning is relevant where an agreement requires regular days and hours, provides for agreed schedules, and requires consultation before schedule changes. The distinction made here is that days must be regular and set in advance, while daily start and finish times may differ: [208]-[210]. The decision also discussed arrangements in which part-time employees are offered or directed to work additional hours under a separate flex-up provision: [216]-[222]. The exact operation of such provisions depends on their wording and the surrounding agreement terms.
The provided judgment does not cite any later decisions that considered or applied National Union of Workers v PMFresh, and the source material supplied here does not establish how later courts or the Commission have treated it. It would therefore be unsupported to claim that later decision-makers have followed, distinguished or limited it.
Within this decision, the Commissioner applied the construction principles in Berri and referred to Endeavour Coal, Mainteck and Kucks when explaining how context and purpose inform interpretation: [157]-[159]. Those authorities concern the interpretive method; they are not later treatment of PMFresh. The decision itself is a single-Commissioner arbitration determination under the parties' Agreement. Its reasoning should be read in that setting and in light of the particular clauses that were before the Commission.
The Commission did not determine the actual temperature in any particular room at a particular time. It said it was not within its authority in this arbitration to make such determinations and observed that the parties would need an agreed method of measuring and recording temperatures: [201]. The recommendation for visible digital thermometers and regular recording was an implementation suggestion, not a binding determination of temperature or entitlement in a specific instance: [202].
The decision did not resolve all possible consequences of its interpretation of “shiftworker”. It noted that clauses 6.4.3 and 6.4.4 addressed breaks and overtime for shiftworkers, but those matters were not questions for arbitration: [187]. It said the observations might warrant consideration by PMFresh.
The Commissioner raised public holiday payment as a concern, reasoning that a part-time employee may be entitled to payment under s 116 of the Fair Work Act if a public holiday falls on an ordinary working day. However, the issue had not been expressly dealt with in the proceeding, and the Commissioner described the concern about PMFresh's practices as a suspicion rather than a finding: [213]-[215].
The decision discussed the flex-up clause and the difference between an offer of additional hours and a direction to work them: [220]-[222]. It did not answer a separate arbitration question about every payment consequence of particular additional-hours arrangements. Nor did it determine the full consequences of the roster findings for every employee or every pattern of work. Its operative answers were confined to the three questions settled for arbitration: [9], [186], [197], [232]-[234].
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s.739 - Dispute resolution
Alleged dispute about any matters arising under the enterprise agreement and the NES - principles of construction of enterprise agreements - when afternoon shift loading payable - when cold room allowance payable - rostering of part-time employees on regular days with regular hours
[1] The National Union of Workers, now the United Workers Union (the Applicant) has applied to the Fair Work Commission (the Commission) pursuant to s.739 of the Fair Work Act 2009 (the Act) to deal with a dispute arising from the application of the terms of the Primo Moraitis Fresh Pty Ltd - NUW - Employees - Enterprise Agreement 2016 (the Agreement) to employees of PMFresh Pty Ltd (the Respondent), formerly Primo Moraitis Fresh Pty Ltd.
[2] The Respondent is a food manufacturer that prepares salads and ready-to-eat meals for large supermarket retailers including Coles, Woolworths, ALDI and IGA. The Applicant has represented the industrial interests of a number of employees at the Respondent's Morningside (or Colmslie) site in Brisbane since 2005, and has been a bargaining representative and party to the following agreements covering employees of the Respondent (and its predecessors: Mrs Crockett's and Salad Fresh):
Mrs Crockett's Kitchen Pty Ltd - Employees - Certified Agreement 2005 (the 2005 Agreement);
Mrs Crockett's Kitchen Pty Ltd & NUW - Employees - Certified Agreement 2008 (the 2008 Agreement);
Chilled Foods McK Pty Ltd (Trading as Salad Fresh) NUW - Employees - Enterprise Agreement 2010 (the 2010 Agreement);
The Primo Moraitis Fresh Pty Ltd - NUW- Employees - Enterprise Agreement 2014 (the 2014 Agreement); and
The Agreement.
[3] The Applicant alleges that the Respondent has failed to correctly apply certain terms of the Agreement to its employees, causing irregular rostering schedules and potential underpayments in entitlements. The dispute concerns the Respondent's application or understanding of the operation of clauses 4.4.1, 4.4.2, 5.5.1, 6.4, 6.1.5 and Appendix C of the Agreement. It is helpful to set out these clauses below.
[4] Clauses 4.4.1 and 4.4.2 of the Agreement state:
"4.4.1 The ordinary hours of part time employees may be worked in accordance with an agreed schedule on not more than five days in a week, Monday to Sunday, dependent on shift patterns inclusive with a minimum of 80 hours (i.e. 20 hours per week) and a maximum 152 hours (i.e. an average 38 hours per week) per 4-week period.
Existing part time employees (pre 2005 Terms & Conditions) shall continue to maintain their set minimum hours as provided for in their letter of appointment.
4.4.2 Part-time employees shall be scheduled to work regular hours on regular days in accordance with clause 4.4.1 and the Agreement provisions for permanent employees.
Changes to the schedule shall only be made following consultation with the employees
concerned. No part time permanent agreed hours of work can be reduced unless:
[5] Clause 5.5.1 of the Agreement states:
"5.5.1 Cold Room - An employee shall be paid 10% in addition to the appropriate rate for work performed in an environment artificially reduced below 4c. This allowance will only apply when an employee is requested by the employer to work continuously for a period of at least 30 mins in such environment. A minimum payment of 4 hours a day will apply."
[6] Clauses 6.1.5 and 6.4 of the Agreement state:
Ordinary hours may be worked between a spread of 5am to 7pm on Monday to
Sunday inclusive. The above spread of hours may be altered by up to one hour at either or both ends of the spread_,_ by agreement between the employer and the majority of
(a) For existing employees, the Ordinary hours worked between 2am and 5am will be paid at the penalty rate of 20% above the ordinary rate and hours over the rostered hours will be paid at overtime rates, unless the hours worked form part of the definition of afternoon shift. Hours worked between 7pm and midnight will be paid at the penalty rate of 18% above the ordinary rate and hours over the rostered hours will be paid at overtime rates unless the hours form part of the definition of nightshift.
(b) For all employees who commenced employment with the Company on or after the operative date of the 2014 Agreement, the ordinary hours worked between 2am and 5am will be paid at the penalty rate of 12.5% above the ordinary rate and hours over the rostered hours will be paid at overtime rates, unless the hours worked form part of the definition of afternoon shift. Hours worked between 7pm and midnight will be paid at the penalty rate of 15% above the ordinary rate and hours over the rostered hours will be paid at overtime rates unless the hours form part of the definition of shift. Nightshift will be paid at the penalty rate of 15%.
i. Subject to this Clause, the Company undertakes not to transfer an
existing employee (Feb 2014) off their regular shift pattern except in the
case of unacceptable work performance or absenteeism.
(d) A request from the employer to work outside the spread of hours in accordance with this clause shall not be unreasonably refused. A person who is requested to work outside the spread of hours and is unable to do so shall not be discriminated against for that reason. Refer to clause 3.1 Dispute Resolution.
(e) Ordinary hours worked by all employees, excluding casuals (see 4.3.2) on a Saturday between the hours of 5.00a.m. and 7.00p.m. shall be paid for at 50 per cent above the ordinary rate. All time worked on a Sunday shall be paid at double time.
(f) Any arrangement of hours for full time or part time employees which includes a Saturday as ordinary hours shall be subject to:
· agreement between the employer and the employee affected
· permanent employees must be given two consecutive days off each week
Permanent part time employees may be given two consecutive days off
· a real increase in workload planned or demonstrated, and
(g) All time worked for full time employees in excess of the rostered ordinary hours in the work cycle will be paid for at overtime rates."
(b) The ordinary working hours of full time shift workers shall be an average of 38 hours per week to be worked in accordance with a roster provided by the employer (subject to clause 6.1.4).
(c) The employer shall give an employee 2 working days (48 hours) notice of change of shift (subject to clause 6.1.4).
(d) Afternoon shift means any shift that is rostered to finish after 7 pm and before 12
(e) Night shift means any shift finishing after midnight or commencing prior to 2 am as
(f) Early morning start means any ordinary hours commencing at or after 2 am and before 05.00 am as per 6.1.5(a)
(a) Employees engaged prior to the 2014 Agreement coming into operation must be paid an 18% loading for working on afternoon shift as per 6.4.1(d) and 20% for night shift on Monday to Friday 6.4.1(e).
(b) For all employees who commenced employment with the Company on or after the
commencement of the 2014 Agreement, will be paid a loading of 15% for working on
afternoon shift in accordance with clause 6.4.1(d) and a loading of 15% for night shift on Monday through Friday in accordance with clause 6.4.1(e).
Shift workers are entitled to a paid 30 minute meal break during each shift and two x 10 minute rest breaks. Such meal breaks shall be taken between the fourth and sixth hour after the commencement of work.
(a) Overtime - all hours worked by shift workers in excess of their normal daily or weekly shift hours (afternoon and night shift) shall be paid at the overtime rate of double time.
(b) Penalty Rates - All hours worked by shift workers as part of their normal shift
hours shall be paid at the penalty rates applicable to the work day being worked - Saturday paid for at the rate of time and a half for the first three hours on any one day and thereafter at the rate of double. Sunday overtime is paid at the rate of double time."
[7] Appendix C of the Agreement provides:
"APPENDIX C - PERMANENT PART TIME FLEX UP HOURS.
The Employer will offer, where practical, additional ordinary hours of work to permanent part-time employees provided that that the permanent part-time employees are available to complete the additional hours of work, have the requisite skills and competency and are able to maintain flexibility over their start & finish times."
[8] Neither party disputes that this matter is capable of being heard and determined by the Commission in accordance with the dispute resolution procedure provided by Clause 3.1 of the Agreement. I am satisfied that the Commission has the power to determine the dispute.
[9] Prior to hearing this matter, I sought submissions from the parties regarding the questions for arbitration. After considering the parties' submissions, the questions for arbitration were settled to be:
"Whether, on the proper construction of the terms of the Enterprise Agreement, including in particular consideration of the interaction between Clause 6.4 and Clause 6.1.5 of the Agreement, the Company is required to pay the relevant afternoon shift loading/s to an employee only for the hours worked between 7:00pm and midnight or for the whole shift?" (the Afternoon Shift Loading Dispute)
"Whether, on the proper construction of Clause 5.5.1 of the Agreement, the Company is required to pay an additional 10% of the appropriate rate to employees that work in an environment that is artificially reduced below 4 degrees?" (the Cold Room Allowance Dispute)
"Whether, on the proper construction of Clause 4.4.2 of the Agreement, the Company is required to schedule part-time employees to work on regular days and regular hours?" (the Part-time Hours Dispute)
[10] It is noted that the Respondent submitted that the Cold Room Allowance Dispute and the Part-time Hours Dispute questions for arbitration should amended to be:
"a. Does the Cold Room Allowance prescribed in Clause 5.5.1 of the Enterprise Agreement apply to employees for work performed outside of the factory's designated cold rooms?
b. if the Answer to 2.a is "No", are employees performing work outside of the factory's Cold Rooms in an artificially reduced temperature instead entitled to the benefits prescribed in Clause 26.3(b) Cold Places, of Modern Award?"
"a. Is the Company required to pay Permanent Part-time employees at overtime rates whenever employees are requested to work in excess of their rostered hours?
b. Whether, on the proper construction of the Agreement, the Company is required to schedule Permanent Part-time employees hours of work in a manner different to its current practice, and in particular whether such hours must be scheduled to be worked on regular days and regular hours on an ongoing basis?"
[11] The Applicant did not consent for the Cold Room Allowance Dispute and the Part-time Hours Dispute questions to be amended, as proposed by the Respondent. The Applicant submitted that the amendments relied on factual issues in dispute, making them inappropriately formulated for arbitration. I did not consider it appropriate to allow the amendments to the questions for arbitration proposed by the Respondent above, and accordingly, the questions for arbitration are those at [9].
[12] This matter was heard before me in Brisbane on 28 and 29 October 2019. A further day of hearing was conducted on 4 December 2019 to hear the final submissions of the parties. Ms Imogen Beynon of the United Workers Union appeared for the Applicant. Mr Stephen McCarthy of Holman Webb Lawyers was granted leave to appear for the Respondent.
[13] The following persons were called as witnesses and gave evidence for the Applicant:
Mr Adrian Burgess, part-time employee of the Respondent;
Mr Anthony Hornby, casual employee of the Respondent; and
Mr Daniel Bradshaw, afternoon shiftworker of the Respondent.
[14] The following persons were called as witnesses and gave evidence for the Respondent:
Mr Peter Roughan, Site Operations Manager of the Respondent; and
Ms Karen Moloney, Manufacturing Manager of the Respondent.
[15] Whilst not all the submissions and evidence of the parties are referred to in this decision, all of such have been considered.
[16] Mr Burgess made a witness statement and appeared and gave evidence at the hearing. Mr Burgess started employment at the Respondent (when it was known as Mrs Crockett's) in about October 2006. He has performed various roles with different rostering schedules since 2006, and at the time of the hearing was a part-time day shift worker in the Work in Progress (the WIP) area.
[17] Mr Burgess stated that his hours of work have not been regular since 2013, particularly his start and finish times. He recalled, as examples, that:
Over one week he was rostered to work one day at 5:00am, the next at 7:00am, the next at 5:00am, and the last at 10:00am; and
• On one occasion he was told by his boss while walking out of work that "you are finishing at 1:30pm tomorrow, not 10:00am", and that if he had not run into his boss he would not have been aware of this change to his roster.[1]
[18] In cross-examination, Mr Burgess stated the varying start times described above were set out on the roster by the Respondent without consultation.[2] Mr Burgess stated that he is frequently directed from management to 'stay back', and in recent months he has worked approximately 38 hours per week, which is eight hours above his rostered 30 hour week. Mr Burgess stated that these additional hours are not considered 'flex up' or overtime by the Respondent.
[19] In re-examination Mr Burgess was asked about his understanding of the operation of Appendix C - the 'flex up' provision of the Agreement, as follows:
I just want to direct your attention back to appendix C, permanent part-time flex-up hours?
Earlier you gave some evidence in relation to your statement about flex-up. Looking at that, do you agree that the flex-up clause requires that the company offer you additional hours?
I'm getting a little bit confused where it says, 'will.'
Thank you. Perhaps do you believe that it requires that an offer be made rather than just a request that you work the hours, based on that clause?
The way I read it, it should be requested: 'Employer will offer where practical.'
So you believe that they have to offer or request but your evidence was that you were told?
It's definitely how it happens. It's always confrontation when it comes, definitely if my answer is, 'Sorry, I can't do it.'
[20] Mr Burgess stated that the roster is posted weekly in front of the production office near the time clock. He stated that the roster has been posted on Wednesdays since November 2018, and the roster informs people what shift they are working from Thursday (the following day). Mr Burgess stated that prior to November 2018, the roster came out on Tuesday for a roster cycle starting Thursday, in which workers knew 48 hours in advance when they were working. In cross-examination, Mr Burgess stated that at the time of the hearing, his roster was still coming out on a Wednesday.[3]
[21] Mr Burgess stated that the roster changes "at least" one to two times daily, without notice. This happens when management alters the printed roster with a pen.[4] Workers are expected to physically check the roster throughout the day, every day, for changes. In Mr Burgess' view, the rostering process does not appear to distinguish between casual or part-time workers. In cross-examination, Mr Burgess stated that he believes his part-time hours should be regular, and he should be consulted about any changes, to give him some sort of stability.[5] In cross-examination, the following exchange occurred:[6]
Mr Burgess, you say at paragraph 15 of your witness statement, and if I could quote, 'In my experience people very frequently attend work for a shift, only to find their work start time has been changed and they are either late or early for work', and I end the quote. So you're testifying that this happens very frequently. Could you tell the Commission when this most recently happened to you?
To me? I've been late to work a few times when my shift has changed from 5.00 to 6.00. I've - I'm one of those people that normally check the roster before I leave to go home, so that meaning the roster has been put out after I've left on a Wednesday. And many - where I'd say that people very frequently attend work for shifts only to find their start times have changed. It happens on a weekly basis. Sometimes people - - -
How could you have been late if your shift went from 5.00 till 6.00?
Yes. So I get to work and I have to ask the boss, can I start early because I didn't see the roster when I left, that from my point of view the roster hadn't been put out by the time I'd left the day before, so I ask can I just start at the 5 o'clock start instead of waiting till 6 o'clock. But many a time you get to work and there'll be someone standing in front of the clock and saying, 'I've been given an - they've put me down as an RDO, I checked the roster before I left work and I was on at this time.' Then they get to work and find out that they've been RDO'd. And in some of those cases it's not just on a Wednesday, it's throughout the week.
Mr Burgess, you say at paragraph 16 of your witness statement that, 'In my experience, casual and part-time workers are rostered in the same way. The rostering process does not appear to distinguish between casual or part-time workers.' Could you explain what you mean by that statement?
In that statement it's just the fact that I don't see the difference between casual and part-time workers, the way they're rostered, especially in areas 3, 4 and 5. I notice that the hours, permanent part-timers can be rostered all over the place and never regular. Never. In some cases it may be regular but in most, it's not.
[22] Mr Burgess recalled that the issue of the Cold Room Allowance not being paid was brought up by Ms Zoe TeMoho, a Team Leader of Area 3 during enterprise bargaining negotiations in 2014. Mr Burgess stated that he was a site delegate of the National Union of Workers during these negotiations. He recalled Ms TeMoho asking why workers working in areas below four degrees were not being paid the relevant allowance. Mr Burgess recalled Mr Peter Roughan stating words to the effect of "that's not an EBA matter" and "it must be a glitch in the system" and "they are working on it".[7]
[23] Mr Burgess stated that during the 2014 enterprise bargaining negotiations, he was working in Area 3 (a processing area), which he was aware was below four degrees. He was not previously aware of the entitlement to the Cold Room Allowance until this was raised during the 2014 bargaining negotiations. Mr Burgess subsequently looked it up in the enterprise agreement and formed the view the allowance should be applied to people performing work in Area 3 because it was consistently below four degrees. He stated that no rooms or areas in the manufacturing plant are referred to as 'designated cold rooms', as suggested by the Respondent at [132].
[24] Mr Burgess stated that over the past three years he has approached Mr Roughan at least three times about the Cold Room Allowance. In Areas 3 and 4, workers wear freezer jackets, hoodies, gloves and scarves. Mr Burgess recalled that Mr Roughan has repeatedly responded with words to the effect, "It cannot be below 4 degrees", and "There is no possible way it is below 4 degrees".[8]
[25] Mr Burgess has had employees in Areas 3 and 4 approach him in his capacity as a site union delegate in the past 12 months about the Cold Room Allowance. Mr Burgess stated that in about May 2018, and at a bargaining meeting on 1 July 2019, he invited Mr Roughan to observe the thermometer in Area 3, but Mr Roughan declined. Mr Burgess stated that he advised Mr Roughan he has been using calibrated thermometers, the same tool used by quality control staff to monitor food temperatures, to monitor the temperature.
[31] Mr Hornby made a witness statement and appeared and gave evidence at the hearing. Mr Hornby has been a casual employee of the Respondent (and its predecessors) for 15 years, predominantly working afternoon or night shift work. He is currently a casual Level 3 shiftworker under the Agreement, working afternoon shifts in Area 5 - the 'pack off' area. Mr Hornby stated that he has consistently worked 38 hours a week and has done so for approximately four years. He noted that since 2013, he has been a National Union of Workers site delegate, and workers approach him about issues related to this dispute.
[32] Mr Hornby stated that most of the employees in Area 5 are on one shift pattern, and it is typically the same shiftworkers working on the afternoon shift every day. He recalled that from 2003 to 2013 he was paid a shift loading for the whole of his shift, and his afternoon shift would commence at 2:00pm and go through until about 10:00pm. Mr Hornby's pay slips from 1 July 2012 to 26 February 2013 were annexed to his witness statement showing that he was paid a shift loading for all hours worked in an afternoon shift during that period.[14]
[33] Mr Hornby recalled that in early 2013, there was a change in the way shift loadings were being paid to him, as he was not receiving a shift loading for the whole of the shift. He stated that in his capacity as a site union delegate he raised this issue with Mr Roughan on different occasions, and Mr Roughan responded with words to the effect:
"Because the Company had moved the start time from 2:00pm to 1.30pm they only had to pay the loading for certain hours";
"You are reading the EBA wrong"; and
• "It's part of being covered by the Modern Award".[15]
[34] Mr Hornby stated that, to the best of his knowledge, in Area 5 there are approximately 10-15 employees (out of 30) that are permanent part-time, one that is full-time, and the remainder are casuals or labour hire employees. There is a notice on the notice board that states you must check your roster daily for changes. The notice also states that you must notify your team leader if you cannot stay back past your rostered time.
[38] Mr Bradshaw made a witness statement and appeared and gave evidence at the hearing. Mr Bradshaw started working for the Respondent in July 2008. Mr Bradshaw has performed various roles with different rostering schedules since 2008. In 2012, Mr Bradshaw was an afternoon shift worker rostered to work from 2:00pm to 10:00pm. He stated that he would often work outside those hours to "help the Company out".[18]
[39] Mr Bradshaw's evidence is that in or around the beginning of 2013, the Respondent changed the afternoon shift start time from 2:00pm to 1:30pm, without consultation. After the first week of working the afternoon shift commencing at 1:30pm, he noticed that he was being paid less. Mr Bradshaw queried this with Mr Roughan, who in reply said words to the effect, "You're not entitled to shift loading and the paid lunch break anymore because you are starting before 2:00pm", "it's not an afternoon shift anymore" and "It's in the Award that we don't have to pay you the loading".[19]
[40] Mr Bradshaw stated that he understood enterprise agreements override awards and that he continued to raise this issue with Mr Roughan. After a few weeks, Mr Bradshaw said to Mr Roughan, "I'm employed to work an afternoon shift, but you are not paying me the afternoon shift loading", and "If you won't pay me correctly, I want to go back on as a picker at 5:00pm".[20] Mr Bradshaw considered that he was punished by the Respondent by receiving less shifts. Mr Bradshaw stated that since around 2016, he has been rostered on three to four night, shifts and one afternoon shift rostered from 1:30pm to around 10:00pm. He receives an afternoon shift loading for a portion of the afternoon shift, not the whole shift.
[41] In re-examination, Ms Beynon, referring the document annexed to Mr Roughan's witness statement called 'MCK payment rules'[21] set out by Mr Roughan below at [86], put to Mr Bradshaw:[22]
... I'm just going to hand you one up. It's attachment 12. My question is simply this, Mr Bradshaw: is this a document that you've ever seen before?
The first time I saw this would have been a week-and-a-half ago I think, when I received an email from you with all the statements and paperwork - yes, so that would have been the first time, because yes, I've never seen anything like this before, except for when it was sent to me in email.
Mr Roughan never showed this to you when you were asking about the shift loadings?
No, not that I recall. The first time - like, as far as I can remember, I think the very first time I saw this was, yes, as I said, about a week-and-a-half ago when it was in the email with all the other paperwork.
I think you've answered the question, but for the record, that document, it wasn't part of the material that you were allowed to look at when you voted on the EBA, was it?
No, this was never - when we voted on an EBA, this document or these tables were, yes, never part of it.
[42] During Mr Bradshaw's evidence, the Respondent indicated that it wished to make a concession of sorts. As will be evident in Mr Roughan's evidence below, in reliance on the MCK payment rules, the Respondent has for some many years decided that where employees commence work at 1:30pm they are not entitled to afternoon shift loading for hours worked up until 7:00pm, but where employees commence work at 2:00pm they are entitled to afternoon shift loading for all hours, on account of the majority of their hours falling after 7:00pm. During Mr Bradshaw's evidence, Mc McCarthy stated that he had instructions that the Respondent would now agree to pay to Mr Bradshaw afternoon shift loading for all hours worked by him, whether he commenced at 2:00pm or earlier, because he is recognised as an afternoon shift worker by the Respondent.[23] Mr McCarthy agreed that there is no definition of afternoon shift worker within the Agreement.
[43] The Applicant submitted that employees who work shifts rostered to finish after 7:00pm and before 12:00am are not receiving the appropriate shift loading for their whole shift. The Respondent is only paying employees the relevant shift loading for hours worked between 7:00pm and 12:00am, and the Respondent has been doing so from around January 2013 (when previous agreements applied). The Applicant submitted that prior to January 2013, the Respondent was paying an afternoon shift loading for the whole of an employee's shift, not only the hours of the shift worked between 7:00pm and midnight.
[44] It was noted by the Applicant that the principles found at paragraph [114] of Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union' known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited[24] (Berri) favour, in the first instance, the literal interpretation of agreements where clauses are clear and unambiguous, as well as a non-technical approach that respects the context of the particular clause.
[45] The Applicant submitted that the clear purpose of clause 6.4 is to provide entitlements for shiftworkers. It was submitted that the employees affected by the Afternoon Shift Loading Dispute are 'shiftworkers' and would meet the definition of 'shiftworker' per clause 30.3 the Food Beverage and Tobacco Manufacturing Award 2010 (the Award), which is incorporated into the Agreement by way of clause 1.8.1.
[46] It was submitted that, in contrast to clause 6.4, clause 6.1.5 covers the ordinary hours of day shift workers. The Applicant submitted that clause 6.1.5 provides for the ordinary spread of hours and different penalty rates to be paid when a day shift employee works outside the spread of hours (except where they would otherwise be considered a shiftworker).
[47] The Applicant submitted that the starting point for construing the Agreement as it applies to afternoon shiftworkers is clause 6.4 as it directly covers shiftworker conditions. It was submitted that clause 6.4 is generally capable of being given clear and common sense meaning, but there is ambiguity because of the definition of afternoon shift at clause 6.4.1(b) which provides "as prescribed by clause 6.1.5(b)".
• The 'spread of hours' clause (clause 6.4) and 'shift work' clause (clause 6.1.5(b)) in the 2010 Agreement changed the definition of afternoon shift to a shift that is rostered to finish after 7:00pm and before 12:00am and added the words "as prescribed at clause 6.1.5(b)" to the definition;[28]
• The iteration of the 'spread of hours' clause in the 2010 Agreement changed the spread of hours, limited employees and the employer from altering the spread, incorporated the ordinary hours worked between 2:00am and 5:00am and added a definition of 'day shift';[29]
[50] The Applicant submitted that as a result of the developments set out in the above paragraph, from the 2014 Agreement onwards, the reference to clause '6.1.5(b)' in clauses 6.4.1(d) and (e) should be read as '6.1.5(c)'. It was submitted that when this typographical error is identified, the interaction between the clauses is limited to cross-referencing definitions of what constitutes an afternoon (and night) shift. These definitional clauses both prescribe that an afternoon shift is a shift rostered to finish after 7:00pm and before midnight.
[51] It was submitted that the reference in clause 6.4 to clause 6.1.5(c) does not trigger any change to the way shift loading is paid, nor does it enliven the operation of clauses 6.1.5(a) and (b) to limit payment for afternoon shift work to the hours between 7:00pm and 12:00am.
[52] The Applicant submitted that the Respondent's evidentiary case clearly conceded that the Respondent primarily relies on an extrinsic 'payment document' (the MCK payment rules) to guide the payment of the afternoon shift loading to employees who work shifts that finish after 7:00pm,[30] rather than applying the terms of clause 6.4. It submitted that it was further conceded by Mr Roughan that in making decisions about how to the pay the shift loading, that the employer was guided by the MCK payment rules, rather than the terms of clause 6.1.5 of the Agreement.[31] The Applicant submitted that both Ms Molony and Mr Roughan conceded that there is nothing in the Agreement that provides an exception to the payment of the afternoon shift loading if an employee starts at 1.30pm.[32]
[53] The Applicant submitted that the MCK payment rules are not admissible evidence of the circumstances surrounding either clause 6.4 or 6.1.5, and has no application to the proper construction of the Agreement. It was submitted that the MCK payment rules did not form part of previous enterprise negotiations, nor were employees told about the document or provided with a copy during the access period for voting on the Agreement (or past enterprise agreements).
[54] In summary, the Applicant submitted that it is reasonable for the Commission to conclude that:
[56] The Applicant submitted that employees who work in certain areas of the Morningside site facility which are artificially reduced below four degrees are not receiving the 10% Cold Room Allowance provided for under the Agreement. It was submitted that Area 3 and Area 4 at the Morningside site facility are areas where the temperature is always below four degrees. The Applicant noted that the Respondent has on occasions said that they are not required to pay the Cold Room Allowance because Area 3 and Area 4 are not considered 'designated cold rooms' and the temperature in those areas is not below four degrees.
[57] It was submitted that, in accordance with the principles in Berri,[34] in the first instance, clause 5.5.1 of the Agreement is unambiguous and on a plain reading of the words provides that the Cold Room Allowance must be paid to employees who work for at least 30 minutes in areas artificially reduced in temperature to below four degrees. The Applicant submitted that there is nothing in clause 5.5.1 to limit its application to 'designated cold rooms', and that 'designated cold rooms' are not an industrially recognised concept at the Respondent's facility.
[58] The Applicant submitted that the Respondent's submissions as to Mr Roughan's subjective considerations of the alleged 'purpose and scope' of the allowance and its application to 'designated cold rooms', as below at [81], should be rejected. It was submitted that there is no cogent evidence that the parties intended to limit the application of the clause to 'designated cold rooms', and in fact, the Respondent's evidence indicates the term is a recent invention for the purpose of this dispute.[35]
[59] The Applicant submitted that the Commission should find that on the proper construction of clause 5.5.1, the Company is required to pay an additional 10% on the appropriate rate to employees that work in any environment at the Morningside site that is artificially reduced below four degrees.[36]
[60] It was submitted that much of the evidence before the Commission during the Hearing went to whether the temperature in the relevant areas is below four degrees.
We say that the company's position that only the SCADA measuring probe or some other certified device can be relied on to take the ambient temperature lacks credibility and should be rejected by the Commission. We say that the air temperature can be appropriately measured by many reliable devices and frequently is. Many factories simply have a temperature gage on the wall, and in fact there are temperature gages on the wall in the factory. As noted in our submissions should the Commission accept that the only appropriate way of measuring the air temperature is via the refrigeration management device it has practical effect of denying the employees the ability to monitor the air temperature themselves for the purpose of enforcing the agreement, and given the employers, or what we say is the employer's open resistance to work in with the employees in measuring the air temperature, I believe cross-examination revealed that despite the employer being made aware of this problem by multiple employees at no time did they seek to go with those employees to see what the temperature was. It is a genuine concern. This is what's happened to date. The applicant would have some concerns that even if the Commission was to find in favour of the applicant about the interpretation of clause 5.5.1 that it does in fact apply to any area in the factory.
But then what do you want the Commission to do beyond that?
We would just say that we are just concerned, I think, that if the Commission finds in favour of the applicant that this problem will arise again because the respondent has said only its temperature data can be considered legitimate with respect to establishing what the temperature is and we say that means the employees can never enforce it because they don't get access to the data. They could have multiple different measuring devices that show that it is below four degrees and we suggest that for that it would just end back here again and we'd be arguing over temperature, so we say that ostensibly we would ask the Commission to find that - or make an observation that there are multiple ways of measuring the temperature data in the factory.
So it'd be covered in the decision but it's not deciding anything. It's dealing with all of the information before the Commission and making an observation.
Yes. We'd concede that - we're not asking you to find on the specific temperature itself but we are just outlining in these closing submissions that we do have concerns with respect to the submissions that the respondent has made in their final submissions that they say no other source except for the SCADA one would be acceptable.
[62] The Applicant submitted that part-time employees employed under the Agreement at the Respondent's Morningside site are not being rostered to work regular hours on regular days in accordance with clause 4.4.2. Rather, permanent part-time employees at the Morningside site are being rostered weekly across different days and with varying hours of work each week. The Applicant further submitted that the Part-time Hours Dispute concerns permanent part-time employees generally as a class of workers, affecting a significant number of employees currently engaged on a permanent part-time basis under the Agreement.
[63] It was submitted that current rostering practices for part-time employees vary start and finish times by as much as six hours per day, and are changed frequently without consultation. The Applicant further submitted that, in the absence of rostering regular days and hours, part-time employees are frequently directed to 'work back' beyond their rostered hours which is not considered 'flex up' or overtime.[38]
[64] The Applicant submitted that Clauses 4.4.2 and 4.4.1 of the Agreement provide:
"Part-time employees shall be scheduled to work regular hours on regular days in accordance with clause 4.4.1 and the Agreement provisions for permanent employees" [Applicant's emphasis]
"The ordinary hours of part-time employees may be worked in accordance with an agreed schedule on not more than five days in a week, Monday to Sunday, dependant on shift patterns inclusive with a minimum of 80 hours (i.e. 20 hours per week) and a maximum 152 hours (i.e. an average 38 hours per week) per 4-week period" [Applicant's emphasis]
[65] It was submitted that, in accordance with the principles in Berri,[39] in the first instance, clause 4.4.2 of the Agreement is unambiguous and on a plain reading of the words the Respondent is to roster part-time employees on regular days with regular hours.
[66] The Applicant submitted that the meaning of 'regular days' and 'regular hours' is not defined in the Agreement. However, the term 'regular' has an ordinary and everyday meaning that broadly means a uniform or symmetrical pattern applied to an object that could be described as usual or customary.[40] The Applicant further submitted that the Oxford Dictionary defines 'regular' as:
"Arranged in or constituting a constant or definite pattern, especially with the same space between individual instances" and "reoccurring at regular intervals"[41]
[67] It was submitted that the place and arrangement of clause 4.4.2 in the Agreement provides relevant context in relation to the interpretation of the clause. The Applicant submitted that the Respondent's discretion regarding rostering arrangements anticipated by clause 4.4.1 are "constrained" by the requirement in clause 4.4.2 to ensure the employees are rostered for work on regular days with regular hours.[42]
[68] The Applicant submitted that clauses 4.4.1 and 4.4.2 require that part-time employees work regular days with regular hours according to an 'agreed schedule'. It was submitted that the concept of 'agreed schedule' is repeated in clauses 4.4.4 and 4.4.5, which provide:
"4.4.4 Part-time employees shall be entitled to payments arising under this Agreement in respect of annual leave, personal / carer's leave, compassionate leave and public holidays on which they would have been ordinarily scheduled for work. Payment will be on a proportionate basis calculated on the normal ordinary hours the employee has worked in accordance with clause 4.4.1. For the purposes of public holidays the employee's average hours over the previous four weeks will be used to determine the payment to such employees. [Applicant's emphasis]
4.4.5 A part-time employee who works outside the agreed hours fixed pursuant to this subclause shall be paid overtime in accordance with clauses 6.3, 6.4 and 6.4.4(a) and 6.4.4(b) (Overtime and Saturday and Sunday work) of this Agreement." [Applicant's emphasis]
[69] It was submitted that, when read in the context of the above clauses, the scheduling of regular days with regular hours per clause 4.4.2 is required for the practical operation of other clauses directly relevant to part-time employees. The Applicant further submitted that without the scheduling of regular days with regular hours, the Respondent would be unable to:
Determine which hours fall outside the 'agreed hours fixed' for the purposes of paying overtime; or
Offer 'flex up' hours in accordance with the terms of Appendix C of the Agreement.
[70] The Applicant submitted that it is reasonable for the Commission to objectively conclude that the plain wording of clause 4.4.2 of the Agreement requires that the Respondent must schedule part-time employee to work on regular days and hours, consistent with the other requirements in clause 4.4.1. It was submitted that this requires days and hours which are arranged in a constant or definite pattern and/or reoccur at uniform intervals. In a practical sense, this requires that the Respondent set the regular days and hours via a weekly roster with at least 48 hours' notice of the first shift to be worked in the subsequent roster period.
[71] The Applicant submitted that, based on the Respondent's evidence in cross-examination, it is also reasonable to conclude that:
Once the weekly roster for permanent part-time employees is set, it becomes an 'agreed schedule' that can only be varied via direct consultation;
The Respondent's current rostering practice of varying the start and finish time/s, without consultation, is in contravention of clause 4.4.2;
Any changes to the roster period within 48 hours that are outside the limited circumstances in clause 6.1.4 must be paid with a loading of 50%;
The operation of the 'flex up' clause requires that the employer 'offer' a part-time employee any additional hours, and they must satisfy themselves that the employee is able to meet the other criteria in Appendix C;
'Offer' in the context of the clause means to an employee whether they want to do additional hours. The offer is preconditioned by the other criteria in the clause;
[72] Mr Roughan made two witness statements and appeared and gave evidence at the hearing. Mr Roughan joined the Respondent in 2008 as a Manufacturing Manager, and since 2013 has been the Site Operations Manager. He has been involved in bargaining negotiations since the 2010 Agreement.
[73] Mr Roughan stated that all prospective part-time employees are provided with a written contract of employment which includes a schedule setting out the "basic conditions" they will be signing up to.[44] Annexed to Mr Roughan's witness statement was an extract of a part-time employment contract which stated that "Hours of Work" are "As per your weekly roster".[45] It was stated that part-time hours need to be aligned to the Respondent's lowest production demand. More recently, the Respondent has been offering new part-time employees higher minimum hours (27 hours to 30 hours) which is more reflective of their average weekly hours.
[74] Mr Roughan stated that "historically" part-time employees are advised of their upcoming working hours via a weekly roster that reflects the forecasted production volumes and the days and hours they are required to work. He stated that there have been many attempts to make the roster process "employee friendly" as the number of part-time employees increase, and the production requirements become more customer-driven. It is his evidence that the Respondent seeks to balance shorter lead times, shorter customer advice of delivery days and times with reasonable notice period to employees of changes to working times, hours and days. It is Mr Roughan's opinion that the flexible arrangements the Respondent has for hours of work for part-time employees are fair and within the bounds of the flexibility allowed by the Agreement.
[75] It is customary practice for all employees to be told to check their rosters on a daily basis. When a new employee starts, during their induction they are told that they must regularly check their area roster for changes. Mr Roughan disagreed with the evidence of Mr Hornby above at [35] about the fluctuation of start times. He stated that Mr Hornby "is referring to events that happened back in previous times and were poor practices of supervisors", and it was not a practice condoned by himself and Ms Molony. He considers that the rostering situation described by Mr Burgess at [17] - [18] in is in line with his and Ms Molony's expectation of a reasonable variation to hours worked.
"This is an historical payroll rule that pre-dates my time at Colmslie but has been pivotal in the way we manage Part-time employees and the agreed 10 hour and 12 hour shift patterns that we operate."[54]
[86] It is Mr Roughan's evidence that there is a "reference document" that has been used by payroll to calculate the applicable hours for the payment of shift allowances which the Respondent "inherited" from previous owners. [55] Annexed to Mr Roughan's witness statement is a four page document titled "10 HOUR SHIFT ROSTER AND PAYMENT RULES" that provides for penalties applicable to all shift starting and ending times.[56] It is noted this document is referred to by the Respondent as the 'MCK payment rules'.
[87] The MCK payment rules work in this way; as a general rule, part-time employees are paid single-time rates for hours worked between 5:00am and 7:00pm, and only hours past 7:00pm attract the afternoon shift loading. Mr Roughan stated that the "one exception" to this general rule, even though the Agreement does not require it, is when an employee starts their hours at 2:00pm or later, and finished after 7:00pm, in which they would attract the afternoon shift loading for the whole of the shift. I understand the reckoning behind this to be that typically employees might be called upon to work a 10 hour shift commencing at 2:00pm. Five of those hours would be worked prior to 7:00pm, and five hours after 7:00pm, for which the Respondent considers that the majority of the hours worked are past 7:00pm, and accordingly all of the shift is then paid at the afternoon shift penalty. It was stated that this exception is a long-established practice at the site.
[88] Mr Roughan does not recall an instance in 2013 that may have brought about the shift change described by Mr Bradshaw above at [39]. He recalled occasions where Mr Bradshaw's pay needed to be fixed up as he often changed shifts, but stated that he never agreed to fix it because the afternoon shift loading was payable.
[89] Mr Roughan stated that Mr Hornby's statement that the afternoon shift commenced at 2:00pm is "his assumption based on his hours worked and are not entirely correct or in line with the actual MCK payment rules".[57] He rejected Mr Hornby's statement that a change in the shift loading rules occurred in 2013, as no change took place to the MCK payment rules. Mr Roughan stated that due to his long-held understanding of the MCK payment rules, he would not have made the comment to Mr Hornby that "", as above in Mr Hornby's evidence at [33].
Mr Roughan: It's not in the EBA.....But it's just - that's common sense. If there is no work for someone at a time of the day because of a change outside of our control, wouldn't it be reasonable to assume that that person would be reallocated so that they could be utilised efficiently? That's what it's about. It's not about changing people on a whim just because we can change someone's start time.
Ms Beynon: Well, I put it to you, Mr Roughan, it's not common sense. It's actually inconsistent with the terms of 4.4.2?
Mr Roughan: You are making me aware of that now, and I understand your point.
[91] Ms Beynon asked Mr Roughan if the main way that people find out about changes to their roster is to advise them to check the roster day, to which Mr Roughan agreed. He responded, "That would be the main way for the majority of people who are on shift to find out if they have had their roster changed."[60]
[92] Relevant to how employees are being consulted as to changes of the roster, the following was put and answered:
Ms Beynon: In the majority of cases. It becomes difficult to say, wouldn't you agree, as in 4.4.2, that changes to the schedule are only being made following consultation in those circumstances?
Mr Roughan: As I said, is advising people on a daily basis or a weekly basis or a time when they are employed, is that not consultation? I mean, how broad do you want to make consultation? My point is I understand your question, and I understand the point you're trying to make. I am just explaining the situation that we have. It isn't an expectation of myself or my supervisors that people go and check their roster. It is basically - yes, it is an expectation, but it is almost a behaviour on the site because that's what people are used to doing. It's for their own - as I say, because we talk about it all the time and our people understand the variability of our business and the volatility of it. As I said, how definitive do you want to be on consultation? We are probably going to disagree on that.
Ms Beynon: Well, I put it to you that people do it at the site because you advise them to. You advise them in their induction, and then you advise them to check it on the daily basis. That is the primary way they find out about changes?
Ms Beynon: Well, I put it to you that having individually to walk up and look at a piece of paper is bereft of any consultation. I am just being told?
Ms Beynon: Is absent any consultation. Where is consultation occurring if I am just looking at a roster where there is, I imagine, my name, the time has been scratched out, and another time has been inserted?
Mr Roughan: I beg to differ, but that's your point, my point, isn't it?
Ms Beynon: Do you believe that includes any consultation?
Mr Roughan: What I believe is that the person does that because they have been involved in the consultation process before they go and visit that board.
Mr Roughan: And I think that's reasonable. I mean, people - okay, I may - as I said, I may be taking a liberal view of what the word consultation means. But we have a process. Our people - you know, there are some areas that it's easier to communicate with the whole team than it is with other areas, and not every area would have the exact same process of informing their employees. We're probably getting - we are getting hung up on this, but anyway. My point is, to the points you have just raised, how we advise, communicate, consult with our employees is the current way we are doing it. Whether it fits with the wording in the EBA, you are making a point, I accept that point, but I am explaining to you how the process works from this side.
Ms Beynon: So Mr Roughan, you accept my point that the company's advice for employees to check the rosters is not in accordance with this - - -?
Mr Roughan: No, I don't accept that. I don't accept that.
Ms Beynon: You don't accept this. You say you are consulting with them?
Mr Roughan: I am saying we have a number of mechanisms within our employment process and our engagement process that I believe fits under that consultation process. Not 100 per cent of the time, but I believe that the mechanisms we have on site are such that there is a consultation process that takes place.
Ms Beynon: I am just going to break those down one more time. The rosters are changed daily?
Ms Beynon: Correct? Yes. On a daily basis, are those employees consulted about the change?
Ms Beynon: Not in every case, because in the majority of cases the way an employee finds out about their roster change is to go and look at a physical roster?
Mr Roughan: I can't say that and you can't say that it's the majority of cases.
Mr Roughan: I don't think it is. I don't think it necessarily is the majority across every area of the factory.
Ms Beynon: Was your previous evidence that you said that's the primary way that people find out?
[93] Relevant to how much notice is given by the Respondent to employees when hours of work are required to be altered, Mr Roughan agreed that there are times when employees are provided with 24 hours' notice.[61] Mr Roughan was asked if, pursuant to the Agreement only 24 hours was given instead of 48 hours due to emergent circumstances, which he agreed is not occurring.[62]
[94] Relevant to the Respondent's implementation of the flex-up clause, the following was put and answered:
Ms Beynon: I'm not asking if they're forced to stay back. I'm asking - I'm putting this proposal to you, proposition to you. The way the clause is implemented by the supervisors or team leaders, whoever it may be, is that they're advised that the hours have changed to stay back?
Ms Beynon: So offer doesn't really form part of the implementation of the clause does it?
Ms Beynon: Not in that sense, okay, thank you. You'd agree though wouldn't you that the employee - they don't have to agree to do the additional hours?
Ms Beynon: It's the case isn't it that they're asked to stay back to do flex-up hours pretty much every day?
Mr Roughan: I think that's a generalisation. I don't think it's every day.
Mr Roughan: Subjective, I don't know, could be two days a week, I don't know.
Ms Beynon: It's very frequent isn't it that they are asked to stay back to do additional hours?
Mr Roughan: I think it depends on the time of year - time of the year, you'd have to - - -
Mr Roughan: Right now, it's probably an interesting time right now because right now we've just come off some major launches. We've got some unprecedented sales growth that's unusual for this time of the year and you'd be aware of this because people are talking to you. But we've had a number of break downs and it is a little bit - right now it is a little bit disruptive. Generally speaking, winter time our hours are - and your site (indistinct) would have told you about this, our winter hours are quite restricted and we do have - we have limited times of extended shifts in winter. Other times of the year it probably is more frequent than that.
Ms Beynon: So it's the case as we've just outlined that the workers are told to stay back to do those additional hours. In those situations you aren't actually utilising the flex-up clause are you?
Mr Roughan: That's your interpretation. My interpretation I think it's a - I obviously have a - I obviously have a broad view of that flex-up clause.
Ms Beynon: Let me put it to you another way. The flex-up clause requires an offer and consideration for factors that we went through before. If that doesn't happen, you're not using the flex-up clause are you. You're doing something else?
Mr Roughan: I can't - I can't argue with that logic of yours, no.
Ms Beynon: So you'd agree with the logic of my - - -?
Mr Roughan: In the context of how you're putting it to me, yes.
Ms Beynon: So if you're not using the flex-up clause when you're directing workers to stay back - - -?
Mr Roughan: Okay, we don't - we don't direct - we don't direct anyone to stay back. There is never - there is never a time where employees are told you must stay. So just to be - you know, we're playing on words here but there's a difference between agreed, there's a different between being asked and being instructed and those sorts of things but employees are not forced to stay back.
Ms Beynon: Have you read Ms Moloney's statement in this matter?
Ms Beynon: So you would be aware that it's her written evidence and I agree that we haven't been able to go through that with her yet, but would you - you are aware that in her evidence she says that employees are directed to stay back.
So paragraph 22 of Ms Moloney's statement. She states that employees are directed to stay back and that is - - -
Commissioner: That some employees may be directed to stay back.
Mr Roughan: Look, that's her statement, you need to ask her.
Ms Beynon: And I will but you would agree that they are directed to stay back - - -?
Mr Roughan: My comment to you is and - my comment to you is, in my opinion and I've said to you, people are not forced. You're inferring that people are forced to stay back, instructed to stay back. I'm saying probably there again, splitting straws, but our people - our people, to the best of my knowledge and I appreciate what Ms Moloney's saying here, her interpretation of - her own words, but you're inferring that we force people to stay back. I'm saying to you in that case that is not the case. People may not be consulted, I've conceded that but as we've discussed there may be circumstances where people for personal reasons or whatever can't accommodate the stay back hours and those people had to go. So if that's the case I don't say that - I can't pass up the opportunity to correct you on the fact that people are forced to stay back.
Ms Beynon: I've not put it to you that they're forced to stay back, Mr Roughan?
Ms Beynon: I have suggested Ms Moloney's evidence says that you do direct them to stay back and we will ask her questions about that, that's her evidence, and you've just given some evidence that you do - you ask them to stay back, you don't request, you don't offer them the opportunity, you instruct them to stay back or you ask them to stay back?
Ms Beynon: So in those circumstances you are not utilising the flex-up clause are you?
Ms Beynon: Not in that context. So what are those workers entitled to be paid when you're not using the flex-up clause because they're part-time workers aren't they?
Mr Roughan: As I say - said before I think - I think the consultation process we've had and I've explained previously and the understanding on the site, there's a general understanding and it's whatever, I think as far as the EBA wording says there are payment rules around those guidelines. I wouldn't - I wouldn't be sitting here contesting the point if I didn't think that we weren't - we weren't, you know, we were paying correctly under the way that I, because I'm in charge of the site, instructed various people to engage and roster people, roster employees.
Ms Beynon: So you're responsible for the direction about - - -?
Mr Roughan: Well, I'm in charge of the site so obviously.
Ms Beynon: You've still got the EBA with you there? Can you turn to 4.4.5 of the EBA?
Ms Beynon: So here we say well a part-time employee who works outside the agreed hours fixed pursuant to this sub clause shall be paid overtime in accordance, sorry, with clauses 6.3, 6.4, 6.5 blah, blah, blah, overtime Saturday and Sunday work of this agreement. So I believe earlier we've established that the roster - the weekly roster sets up the agreed hours. That's correct, isn't it?
Ms Beynon: So in circumstances where they're being asking - they're being instructed, they're being told to stay back after their rostered hours, they'd be entitled to overtime in accordance with this clause wouldn't they?
Mr Roughan: In accordance with this clause, correct.
Ms Beynon: In accordance with this clause, correct. Does that happen Mr Roughan?
Ms Beynon: So would you accept that you're not paying those part-time employees in accordance with the EBA?
[95] Relevant to the Afternoon Shift Loading Dispute, in cross-examination, and in answering questions from me, the following was discussed:[63]
Commissioner: So somebody who starts at 10 am and works till 8 pm why aren't they a shift worker?
Mr Roughan: There again that goes back to the period of 2014, 16, when we changed the 7 pm clause taking into account that once we extended those hours they were still deemed a day shift worker, they weren't - to answer your question, that was part and parcel of the 2014, 16 discussions.
Commissioner: I'm just looking at this clause here, so under this clause why aren't they an afternoon shift worker?
Mr Roughan: Because the understanding was they sat outside that because they were a day shift worker.
Commissioner: Is that picked up somewhere else in the enterprise agreement is it?
Commissioner: Are you going to be asking questions about this, Ms Beynon?
Ms Beynon: I'm happy for you to ask them, Commissioner.
Commissioner: No, I don't want to step on your toes but I'll ask questions if you don't deal with it. I just picked up that you said 10 am to 8 pm rostered is not afternoon shift?
Mr Roughan: No, because we - I mean we - it was around - sort of around our day shift, how we viewed our day shift employees, the majority of their hours are done on day shift versus people whose majority of hours are done after 7 pm.
Commissioner: The majority of their hours are done?
Mr Roughan: Well, the majority of their hours were before 7 pm they were deemed to be day shift workers. If the majority of their hours were necessarily post 7 pm then the majority of people in that case would have been the people who were specifically put on afternoon shift or night shift.
Commissioner: Where is that provided for in the enterprise agreement?
Mr Roughan: It isn't. It's just a payment rule that we have.
Commissioner: This is Mrs Crocket's rule that you have, is it?
Mr Roughan: It goes back to - it goes back partly to those days, yes.
Ms Beynon: We'll probably revisit the day shift workers but an afternoon shift worker like Mr Hornby, he's working 3 pm to 11 pm, falls within the definition of afternoon shift, he's a shift worker, should he be getting the loading for the whole shift?
Mr Roughan: If he's consistently working after 3 pm I'd suggest that's the way he's being paid, yes.
Mr Roughan: Under - I mean this is where the Commissioner was asking the question about the Mrs Crocket's payment rules. Under those - there's a time break there one, I think it's 1.30, 2 pm, if the roster start time was before 1.30 then only the hours after 7 pm are paid as - with a shift allowance.
Ms Beynon: We've just read through the whole shift loading clause, does it say anything in that clause about 1.30 starts?
Ms Beynon: Does it say anything in that clause about where the majority of your hours fall?
Ms Beynon: The payment rule, as you're referring to, they don't form part of the EBA do they?
Mr Roughan: No, but there's a - not as such but they were a reference point that we've had since - however long, 2008, 2010. That's been the - that's been the payment rules that we had back in the day and yes, they - as far as I'm aware no, they're not part of - they're not part of the EBA.
Ms Beynon: They're not part of the EBA at all are they?
Ms Beynon: Do employees have access to this document?
Ms Beynon: At any time they've voted on the any of the EBAs have they been given a copy of these rules?
Ms Beynon: So you'd agree with me, wouldn't you, that you can't just make up some different rules that are inconsistent with the EBA and just start applying them can you?
Mr Roughan: I don't think it's these are made up rules. This is an historic - this is an historic - that was the way - this is the way we paid people beforehand - for whenever and a day. It's not - it wasn't made up in 2016, it wasn't made up in 2014, it wasn't made up in 2010. I mean it's been part and parcel of our payment rules for however long. It hasn't been made up just to suit the 2016 agenda or the 2014 agenda.
Ms Beynon: No, but they are made up aren't they? They're not consistent with the EBA?
Mr Roughan: I agree, they're not consistent with the EBA because they're not part of the EBA but I don't know where you're going with it, the terminology made up - - -
Ms Beynon: They're less than the - they provide for less than the EBA don't they?
Ms Beynon: In Mr Hornby's case, he starts working 1.30 and then finished at 10?
Ms Beynon: He gets a lot less money under these payment rules than the EBA allows for doesn't he?
Ms Beynon: Yes, you concede that. So these payment rules are inconsistent with the EBA and they provide for less?
Mr Roughan: In some cases they appear to provide less, yes.
Ms Beynon: Employees voting on the EBA, they didn't even know these existed did they?
Mr Roughan: I have to take that point, I agree with that point, yes.
Ms Beynon: So in that sense they are just - they're just made up. They're made up rules, they don't connect to the EBA?
Mr Roughan: Look, in the context of how you're putting it, made up in your words, they're the payment rules that we've had right or wrong for a period of time. They weren't - okay, I concede that it was not part of the EBA, they're not related to the EBA, to your use of words but they're made up.
[96] In answering questions from me, Mr Roughan stated that because Mr Bradshaw worked the majority of his hours in the afternoon, whether it be a 1:30pm start or a 5:00pm start, he now wished to make a concession to Mr Bradshaw, and pay to him all of his hours at the afternoon shift rate, and not just hours worked post 7:00pm. Mr Roughan explained the afternoon shift applying to all hours of work where the employee commenced the shift at 2:00pm, but he stated, "The way we work it is anyone who starts before 1:30, up to 1:30 doesn't receive it."[64]
[97] Ms Beynon put the following to Mr Roughan:[65]
Ms Beynon: I put it to you, Mr Roughan, that the shift hours clause that we went through earlier is the clause that should determine how employees working on shifts are paid, and you'd agree with that proposition wouldn't you?
Mr Roughan: I would agree with that proposition in the context of how we're seeing things, yes.
Ms Beynon: It's not the case that you can use the Mrs Crocket's payment rules to decide how to pay employees can you?
Mr Roughan: Well, not in the context of - no, I accept that in the context of how the EBA is written and the EBA conditions, yes.
Ms Beynon: Over the last few years you would accept the proposition that you've relied on those rules in error to pay people wouldn't you?
Mr Roughan: I would. We've relied on those rules, yes. In hindsight, maybe.
Ms Beynon: You'd appreciate then that that has caused you to breach the EBA?
[98] Ms Molony made a witness statement and appeared and gave evidence at the hearing. Ms Molony has worked in multiple roles for the Respondent (and its predecessors) for 25 year since 1994. Ms Molony is the Morningside site's Manufacturing Manager and is responsible for management of production teams and production processes. She has been involved in bargaining negotiations of the relevant agreements since about 2006.
[99] Ms Molony stated that when a permanent part-time employee commences employment, they are given a letter of employment advising them of their minimum hours and pay and conditions which references the relevant enterprise agreement. The contract also indicates whether the employee will be on an eight, ten or twelve hour day and the ordinary rate of pay. The letter also sets out the payment rules that apply to these conditions. The letter informs employees that overtime rates of pay do not apply until the employee has worked 38 hours in a week. An example of a letter of employment given to part-time employees was annexed to Ms Molony's witness statement.[66] The example provided states:
"It is a condition of employment that all new employees who commence employment may be rostered to a maximum of twelve hours at Ordinary time per day. Overtime rates do not apply when working up to 12 hours per day/38 hours per week."
[100] Ms Molony stated that a part-time employee is rostered weekly and what determines their hours of work on a daily basis is a forecast, keeping in mind that their minimum hours must be met for the week. The Respondent does not manufacture all products every day, meaning start times will vary to ensure process flow meets productivity demand. The weekly roster is set against the customer-provided forecast, but the customer can change their orders with 24 hours' notice.
[101] Ms Molony's evidence is that to enable the business to supply customer orders there may be instances where an employee is required to work past the initial rostered hours. These additional hours may form part of their ordinary hours according to their contract and not incur an overtime penalty. Ms Molony stated that if, for instance, a ten hour employee has completed seven hours and they are asked to stay back then they can work the additional three hours at ordinary rate and any hours over the ten hours will paid at the applicable overtime rate. Ms Molony stated that a part-time employee can also work additional ordinary hours or 'stay back' above their rostered hours and up to 38 hours a week under the 'flex up' provisions of the Agreement.[67]
[102] Ms Molony is not aware on any fluctuation of rostering to the extent described in Mr Hornby's evidence above at [35]. Ms Molony also stated that she rejects the evidence put by Mr Burgess in respect to rostering, and she set out some of Mr Burgess shift patterns between 2013 and 2019.[68] It was submitted that Mr Burgess was working on shift patterns with little variation. Ms Molony stated that she is unsure what Mr Burgess means about there being no difference between the rostering of casual or part-time employees, as above at [21]. It was stated that when considering a permanent part-time employee for rostering purposes the Respondent must ensure their minimum hours are met for the forecasted week, which in turn dictates how many days the part-time employee will work as a minimum. However, for casual employees there is no guaranteed minimum hours or days.
[103] Ms Molony stated that the timing of the posting of the roster was changed recently when the issue was raised during bargaining negotiations that employees were not getting sufficient notice of their next shift. It was stated that to enable more notification time, the Respondent was able to change the posting of the roster to an additional day earlier to "endeavour" to allow employees at least 48 hours' notice of their next shift.
Ms Beynon: Do you recall whether it was explained to employees that the flex-up clause was less beneficial than their rights as permanent part-timer under the Modern Award?
Ms Beynon: And are you aware that the flex-up clause is less beneficial than their rights as part-timers under the award?
Ms Beynon: Are you aware that if you have a set roster under the award and you work outside of those days and hours of work in the award that you get overtime?
Ms Beynon: Does Ms Moloney have a copy of that F17?
Ms Beynon: Ms Moloney, have you seen this document before? It's a stat dec, statutory declaration that you provided?
Ms Beynon: And if you just go to the second-last page of that - actually probably the third-last page, the Commission asks you to identify whether there's any terms of the agreement you're putting out for approval that are less beneficial terms than the reference instrument or have changes that are not conferred, ones that just don't exist in the Modern Award?
Ms Beynon: If you turn the page over the company has listed two areas in which they say it's less beneficial, and it's casual loading and the higher duties?
Ms Beynon: Casual loading being 23 per cent and not 25 per cent?
Ms Beynon: You haven't listed the flex-up clause and the permanent part-time clause there, have you?
Ms Beynon: So you haven't made the Commission aware of the operation of the flex-up clause and therefore they haven't been able to assess whether the agreement is better off overall for employees, have you?
Ms Molony: I wasn't aware that the flex-up wasn't beneficial to employees. We did have to - sorry, I'm aware that the Commission had to read that document and we did actually change Saturday payment rules after they had scrutinised the document, and that flex-up clause wasn't part of that scrutiny by the Commission.
Commissioner: Ms Moloney, it's a very important document that you must provide to the Commission if you're looking for an enterprise agreement to be approved?
Commissioner: And you provided a statutory declaration in 2016 where you've nominated only two provisions of the agreement that are less beneficial than the award. Now, you have a solemn responsibility to inform the Commission of all the things within your knowledge. Were you aware that part-time employees under the award were entitled to overtime if they worked beyond scheduled hours under the award?
[119] Ms Molony gave evidence that the Respondent obtained the assistance of an employment advisory company based in Brisbane to assist in the preparation of documents for the approval of the Agreement.
[120] Relevant to the Cold Room Allowance, Ms Molony agreed that the Respondent's temperature data is taken from a probe in the roof of the rooms, and they could be as high as 20 foot tall. Ms Molony was unsure if because the probes are in the roof that it might equate to them being the hottest part of the room on account of hot air rising.
[121] Ms Molony gave evidence that if the Respondent was satisfied that a room was cooled below four degrees, the employees would be entitled to the cold room allowance.[83]
[122] The Respondent submitted that the Agreement is not a "comprehensive agreement".[84] It was submitted that the terms of the Award are incorporated into the Agreement because of Clause 1.8.1, which provides:
This Agreement shall be read and interpreted to incorporate the Food, Beverage and Tobacco
Manufacturing Award 2010 (Award). Provided where there is any inconsistency between this
Agreement and the Award, this Agreement shall take precedence to the extent of any
This Agreement incorporates the National Employment Standards (NES) in accordance with the Act, and a Fair Work Information Statement will be provided to all new employees. Provided
where there is any inconsistency between this Agreement and the National Employment Standards, the more beneficial provisions to an employee shall take precedence."
[123] The Respondent submitted that the starting point for understanding the Afternoon Shift Loading "for employees who are not engaged as shiftworkers under clause 6.4" is clause 6.1.5.[85] It was noted that clause 6.1.5 is a sub-clause to Clause 6.1 titled "HOURS OF WORK". It was submitted that clause 6.1 (including clause 6.1.5) constitutes the hours provisions under the Agreement for employees who are not employed as shiftworkers under clause 6.4.
[124] To repeat, clause 6.1.5 reads:
Ordinary hours may be worked between a spread of 5am to 7pm on Monday to
Sunday inclusive. The above spread of hours may be altered by up to one hour at either or both ends of the spread_,_ by agreement between the employer and the majority of
(a) For existing employees, the Ordinary hours worked between 2am and 5am will be paid at the penalty rate of 20% above the ordinary rate and hours over the rostered hours will be paid at overtime rates, unless the hours worked form part of the definition of afternoon shift. Hours worked between 7pm and midnight will be paid at the penalty rate of 18% above the ordinary rate and hours over the rostered hours will be paid at overtime rates unless the hours form part of the definition of nightshift.
(b) For all employees who commenced employment with the Company on or after the operative date of the 2014 Agreement, the ordinary hours worked between 2am and 5am will be paid at the penalty rate of 12.5% above the ordinary rate and hours over the rostered hours will be paid at overtime rates, unless the hours worked form part of the definition of afternoon shift. Hours worked between 7pm and midnight will be paid at the penalty rate of 15% above the ordinary rate and hours over the rostered hours will be paid at overtime rates unless the hours form part of the definition of shift. Nightshift will be paid at the penalty rate of 15%." [Respondent's emphasis]
[125] It was submitted that it is important for the Commission to understand that the spread of hours provisions apply to all employees employed under the Agreement other than those specifically engaged as shiftworkers under clause 6.4. The Respondent submitted that the wording of clause 6.1.5 of "...unless the hours form part of the definition of shift. Nightshift will be paid at the penalty rate of 15%" is referring to employees engaged as shiftworkers under clause 6.4. It was submitted that this is to ensure that the reader recognises that an employee who is employed as a shiftworker covered by the terms of clause 6.4 is entitled as a shiftworker to their shift allowance for the entire shift, as opposed to the prescription set out in the earlier part of the clause which prescribes the payment of the shift allowance only for hours worked after 7:00pm for employees covered by clause 6.1.5(b) (employees generally engaged as day workers working ordinary hours past 7:00pm).
[126] The Respondent submitted that, for the reasons outlined above, clause 6.1.5 of the Agreement provides:
The hours during which ordinary hours for employees generally are to be worked, from 5:00am until 7:00pm Monday to Sunday, and such a spread of hours are clearly intended to apply to day workers and not shiftworkers; and
Ordinary hours worked outside the generally prescribed spread of hours, for example ordinary hours worked between 7:00pm and midnight, are ordinary hours worked within the prescribed hours that attract payment of an Afternoon Shift Loading. Significantly, the Afternoon Shift Loading provisions prescribed in clause 6.1.5 are prescribed to apply only to those hours worked between 7:00pm and midnight. The Afternoon Shift Allowance is not prescribed to apply for all of the ordinary hours worked. They are an entirely separate set of shift allowance provisions from those set out in clause 6.4**,** that apply to employees employed at shiftworkers.
[127] It was submitted that given the Respondent's concession in relation to the payment of the shift allowances for employees employed as shiftworkers in accordance with Clause 6.4, the Applicant's submission in relation to Clause 6.4, which included those in relation to an alleged "typographical error" in Clause 6.4.1(d) are not relevant.
• There is evidence of the surrounding circumstances and of objective background facts to aid in the interpretation of the Agreement, which includes the MCK payment rules for afternoon shifts, the Applicant's 2014 log of claims, and the resulting new Clause 6.1.5(b) introduced to the 2014 Agreement and retained in the Agreement.[88]
[131] At the hearing the Respondent made the following concession:[89]
I do, Commissioner, and they would be consistent with what I have already suggested, and that is this, that the company does recognise that its focus has been on the debate about how to pay the shift allowance of those employees it has who generally work within the spread of hours but may work some hours after 7 pm, and hasn't concentrated particularly on the small group of employees it has who it specifically employs as shift workers, and it concedes that those employees it employs as shift workers ought to have been paid the shift allowance for all of their ordinary hours whilst engaged as shift workers, and that needs correction.
[132] In respect of the Cold Room Allowance dispute, the Respondent put a primary submission that clause 5.5.1 only applies to employees working in three areas of the site that the Respondent "for convenience" has described in these proceedings as the site's 'designated cold rooms'.[90] The Respondent made submissions, as a secondary and alternative submission, about practical issues associated with temperature readings across the site, should the Applicant succeed on this issue.
[133] The Respondent submitted that the Agreement's Cold Room Allowance was agreed to and inserted into the Respondent's earlier enterprise agreements by the negotiating parties during previous enterprise bargaining rounds to provide a "site specific disability allowance" that is to be paid to those employees who work in the site's consistently coldest work spaces.[91] It was submitted that the Cold Room Allowance has been put in the Agreement specifically separate from and to displace the Award's "Cold places" allowance which is incorporated into the Agreement. The "Cold place" allowance found in the Award at clause 26.3 provides:
An employee who works for more than one hour in places where the temperature is reduced by artificial means below 0 degrees Celsius must be paid 2.8% of the standard rate per hour extra. In addition, where the work continues for more than two hours,the employee is entitled to 20 minutes' rest after every two hours' work without loss of pay."
[134] It was submitted that, for the Applicant to be successful on this issue, the Commission would be required to take the view that the wording of the disability allowance - "Cold Room" - has no specific reference or function or effect and that the disability allowance prescribed by clause 5.5.1 is of general application to all work areas throughout the factory.
[135] The Respondent submitted that its position is that the title of the clause 5.5.1 - "Cold Room" - is specifically referring to those areas of the factory that are specifically intended to be refrigerated to operate at or below four degrees. The Respondent put that there are three such refrigerated work places within this category and which thereby attract the payment of the Cold Room Allowance.
[136] It was submitted that recognition by the Agreement's bargaining parties that there are specific parts of the factory that are intended to be operated at lower refrigerated temperatures than other parts is not restricted to clause 5.5.1 of the Agreement. The Respondent submitted that in addition to clause 5.5.1, the parties to the Agreement recognise that the site has certain specific work areas that operate at "much colder temperatures" than other parts of the site. The Respondent referred the Commission to clause 9.2.1 of the Agreement, which provides:
When an employee is working in the Deep Freeze and/or Cold Store Plant, such employee shall be supplied by the Employer, free of charge for fair wear and tear of not less than 12 months, suitable gloves, clothing, boots and headgear. The employee shall be responsible for such articles whilst in their possession and on termination of such services return same to Employer in good order and condition, fair wear and tear accepted, or shall pay for the same."
[137] The Respondent submitted that clause 9.2.1 is the clothing provision of the Agreement that applies to the factory's three 'designated cold rooms'. It was submitted that clause 9.2.1, like clause 5.5.1, does not apply to the factory's processing areas. The Respondent submitted that this is consistent with the evidence of Ms Molony and Mr Roughan.
[138] The Respondent submitted that the parties to the Agreement chose to differentiate the scope and operation of the Agreement's cold room allowance by designating it the geographically limiting title of "Cold Rooms". It was submitted that the heading or title of clause 5.5.1 - "Cold Rooms" - is significant in the identification of the scope, prescription and meaning of the provision conferred by the clause. The Respondent submitted that the Berri[92] principles support this, in that:
The whole text of the provision should be considered, including the title; and
• The ordinary meaning of "Cold Room" should be applied in the interpretation of the clause.[93]
Cold Room Allowance Dispute - Alternative Submission
[139] The Respondent submitted that, while its position is that at all times the Cold Room Allowance applies only to work in the factory's 'designated cold rooms', it puts alternative submissions should the Commission not agree with the Respondent's understanding of the scope and application of the Cold Room Allowance prescribed by clause 5.5.1 of the Agreement.
[140] In was submitted that the Respondent alternatively puts:
Given the constantly lower temperatures in the factory's 'designated cold rooms' which are intended to be set to operate at under four degrees, as a general rule only those employees who are required to work in 'Cold Rooms' would be entitled to payment of the Agreement's Cold Room Allowance at all times;
Employees working outside the factory's 'designated cold rooms' (employees who work in the factory's processing areas) would only be entitled to be paid the allowance on those occasions where the temperature is artificially reduced to below four degrees and an employee is required to work continuously in that environment for 30 minutes or more on a day or shift in accordance with clause 5.5.1;
The incidence of employees working in processing areas continuously for 30 minutes or more in temperatures constantly below four degrees should be rare and, for many of the processing area employees, possibly non-existent; and
The Respondent's methodology to measure the temperature is an appropriate one and is to be preferred to that of Mr Burgess'.
[141] The Respondent submitted that the proper construction and meaning of clause 4.4.2 of the Agreement is not "straight forward".[94] It was submitted that clause 4.4.2 is the second sub-clause of clause 4.4. Clause 4.4 is titled "PART-TIME EMPLOYMENT", and it collectively prescribes the part-time employment specific provisions of the Agreement.
[142] The Respondent submitted that clause 4.4.2 reads as:
"4.4.2 Part-time employees shall be scheduled to work regular hours on regular days in accordance with clause 4.4.1 and the Agreement provisions for permanent employees.
Changes to the schedule shall only be made following consultation with the employees
concerned. No part time permanent agreed hours of work can be reduced unless:
[143] In respect of the wording of "changes to the schedule shall only be made following consultation with the employees concerned" in clause 4.4.2, the Respondent submitted that where the Respondent requires an employee to work additional hours - which for part-time employees will typically be under the 'flex up' option - that does not constitute a "change in the schedule" as set out in the weekly rosters. It was submitted that these hours are not additional hours to the scheduled roster hours and not changes to the weekly roster.
[144] The Respondent submitted that the requirement prescribed in clause 4.4.2 that the Respondent is to schedule part-time employees to work regular days with regular hours is a prescription that does not operate in isolation from other provisions of the Agreement. It was submitted that clause 4.4.2 cannot be determined by simply interpreting the wording of clause 4.4.2 in isolation, and must be determined paying regard to other related provision in the Agreement.
[145] It was submitted that it is necessary to consider the impact of the incorporation of clause 4.4.1 into clause 4.4.2 when determining the meaning and application of clause 4.4.2. The Respondent submitted that clause 4.4.1 reads as:
"4.4.1 The ordinary hours of part time employees may be worked in accordance with an agreed schedule on not more than five days in a week, Monday to Sunday, dependent on shift patterns inclusive with a minimum of 80 hours (i.e. 20 hours per week) and a maximum 152 hours (i.e. an average 38 hours per week) per 4-week period." [Respondent's emphasis]
[146] The Respondent submitted that taking into account clause 4.4.1, in scheduling part-time employees to work on regular days with regular hours under clause 4.4.2 the Respondent:
May set such hours in accordance with an agreed schedule;
Cannot schedule the hours on more than five days per week;
Is to schedule such hours taking in account the shift patterns operated by the business; and
Is to ensure such scheduled hours are not less than 20 hours in a week or less than 80 hours in a four week period, nor more than an average of 38 hours in a week or more than 152 hours in a 4 week period.
[147] It was submitted that clause 4.4.2 specifies that the scheduling of part-time employees work hours will be in accordance with "the Agreement provisions for permanent employees". The Respondent submitted that the wording of clause 4.4.2 "would clearly encompass the need to consider" the separate but related terms of Appendix C and clause 6.1.
[148] The Respondent submitted that Appendix C requires the Respondent to offer additional hours of work to part-time employees beyond the employees' rostered, scheduled or pre-advised ordinary hours. Such additional hours are paid at single time rates, not overtime.
[149] It was submitted that under the Respondent's standard offer of employment letter, part-time employees have agreed as a term of their employment that the employees scheduled "ordinary hours of work" shall be determined by the weekly roster. The Respondent submitted that, consequently, it has been agreed with the Respondent and each of its part-time employees at the time of engagement that the scheduling of their working hours will be set in advance by the weekly roster. The Respondent noted that:
Appendix C was introduced as part of the 2014 Agreement and retained in the Agreement;
The Respondent was not employing part-time employees prior to the introduction of Appendix C; and
All Part-time employees were employed after the 2014 Agreement was made and agreed contractually to the arrangement regarding "ordinary hours of work" being set by the weekly roster.
Principles of construction of enterprise agreements
[157] The issue raised by the Applicant concerns the proper construction of clauses of the Agreement. The approach to this task was most recently set out in a Decision of a Full Bench of the Commission in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU) v Berri Pty Ltd[100] as follows:
"1. The construction of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a disputed construction of an agreement will turn on the language of the agreement having regard to its context and purpose. Context might appear from:
(ii) the disputed provision's place and arrangement in the agreement;
(iii) the legislative context under which the agreement was made and in which it operates.
2. The task of interpreting an agreement does not involve rewriting the agreement to achieve what might be regarded as a fair or just outcome. The task is always one of interpreting the agreement produced by parties.
3. The common intention of the parties is sought to be identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement, without regard to the subjective intentions or expectations of the parties.
4. The fact that the instrument being construed is an enterprise agreement made pursuant to Part 2-4 of the FW Act is itself an important contextual consideration. It may be inferred that such agreements are intended to establish binding obligations.
5. The FW Act does not speak in terms of the 'parties' to enterprise agreements made pursuant to Part 2-4 agreements, rather it refers to the persons and organisations who are 'covered by' such agreements. Relevantly s.172(2)(a) provides that an employer may make an enterprise agreement 'with the employees who are employed at the time the agreement is made and who will be covered by the agreement'. Section 182(1) provides that an agreement is 'made' if the employees to be covered by the agreement 'have been asked to approve the agreement and a majority of those employees who cast a valid vote approve the agreement'. This is so because an enterprise agreement is 'made' when a majority of the employees asked to approve the agreement cast a valid vote to approve the agreement.
6. Enterprise agreements are not instruments to which the Acts Interpretation Act 1901 (Cth) applies, however the modes of textual analysis developed in the general law may assist in the interpretation of enterprise agreements. An overly technical approach to interpretation should be avoided and consequently some general principles of statutory construction may have less force in the context of construing an enterprise agreement.
7. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or it is ambiguous or susceptible of more than one meaning.
8. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.
9. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.
10. If the language of the agreement is ambiguous or susceptible of more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.
11. The admissibility of evidence of the surrounding circumstances is limited to evidence tending to establish objective background facts which were known to both parties which inform the subject matter of the agreement. Evidence of such objective facts is to be distinguished from evidence of the subjective intentions of the parties, such as statements and actions of the parties which are reflective of their actual intentions and expectations.
12. Evidence of objective background facts will include:
(i) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement;
(ii) notorious facts of which knowledge is to be presumed; and
(iii) evidence of matters in common contemplation and constituting a common assumption.
13. The diversity of interests involved in the negotiation and making of enterprise agreements (see point 4 above) warrants the adoption of a cautious approach to the admission and reliance upon the evidence of prior negotiations and the positions advanced during the negotiation process. Evidence as to what the employees covered by the agreement were told (either during the course of the negotiations or pursuant to s.180(5) of the FW Act) may be of more assistance than evidence of the bargaining positions taken by the employer or a bargaining representative during the negotiation of the agreement.
14. Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning, but it cannot be used to disregard or rewrite the provision in order to give effect to an externally derived conception of what the parties' intention or purpose was.
15. In the industrial context it has been accepted that, in some circumstances, subsequent conduct may be relevant to the interpretation of an industrial instrument. But such post-agreement conduct must be such as to show that there has been a meeting of minds, a consensus. Post-agreement conduct which amounts to little more than the absence of a complaint or common inadvertence is insufficient to establish a common understanding."
[158] In CFMEU v Endeavour Coal Pty Ltd T/A Appin Mine[101] a Full Bench of the Commission held that the context of an agreement provision is significant. In this regard, the Full Bench set out the explanation of this point by the NSW Court of Appeal in Mainteck Services Pty Ltd v Stein Heurtey SA[102] emphasising the following matters:
• Until a word or phrase is understood in the light of the surrounding circumstances, it is rarely possible to know what it means[103] and there is always some context to any statement;[104]
• Language considered in its context will often have a clear meaning and context will often not displace that meaning - "but not always";[105]
• To state that a legal text is clear reflects the outcome of an interpretation process and means that there is nothing in the context that detracts from the ordinary literal meaning and cannot mean that context can be put to one side;[106]
• The phrase used by Mason J in Codelfa "if the language is ambiguous or susceptible of more than one meaning" does not mean that the susceptibility of the language to more than one meaning must be assessed without reference to the surrounding circumstances and in order to determine whether more than one meaning is available it may be necessary to turn to context;[107] and
• Context has also been described as surrounding circumstances and the meaning of terms normally requires consideration not only of the text, but of the surrounding circumstances known to the parties and the purpose and object of the transaction.[108]
[159] The case law in relation to the approach to the construction of enterprise agreements makes it clear that context and purpose are relevant to the construction of provisions in an enterprise agreement and must be considered even where the words of the provision being construed appear, on their face, to have a clear and unambiguous meaning. The following observations of Madgwick J in are also apposite in the present case:
"It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.
But the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award. So, for example, ordinary or well-understood words are in general to be accorded their ordinary or usual meaning."[110]
[160] Throughout the hearing, and in consideration of the Respondent's evidence relevant particularly to the Afternoon Shift Loading Dispute, the Respondent has, for at least a decade, relied upon the MCK payment rules inherited by it. Despite being a reasonable-sized employer, and it seems, having earlier had available to it the services of a local employment advisory company, the Respondent has applied a foreign document to dictate payment terms to employees covered by the Agreement.
[161] The Respondent has also placed heavy reliance on its common law employment agreement with employees covered by the Agreement.
[162] It is extraordinary that the Respondent has, and continues to put before the Commission that it was entitled to rely on terms within the employees' employment agreements, together with the MCK payment rules to govern how the Respondent says it should pay the employees. The evidence of Mr Roughan and Ms Molony I believe was sincerely given, however I consider they must be either extraordinarily naïve, or have been, for many years, provided with incorrect information to continue their assertion that the Respondent is entitled to pay to MCK payment rules where they provide for a reduced entitlement to employees than the Agreement.
[163] When I put to Mr McCarthy that it was a nonsense for the Respondent to have placed any reliance on the MCK payment rules to decide when people become entitled to afternoon shift loading, I expected there to be an appropriate concession from the Respondent. The MCK payment rules have, until the production of them for the purposes of the hearing, been a mysterious document, known only to the Respondent. Employees had not been shown the document, and it certainly did not form part of any of the bargaining negotiations for at least the last two agreements entered into.
[164] No such concession was made, and it is still unclear how the Respondent says that it is entitled to decide, at its discretion, that employees who commence work at 1:30pm will not be entitled to afternoon shift loading for all hours worked, but those who commence work at 2:00pm or later, will be entitled to afternoon shift loading for all hours worked. Or how, at the employer's discretion, employees' rosters can be changed so long as it's a change of around two hours.
"Subject to this Clause, the Company undertakes not to transfer an existing employee (Feb 2014) off their regular shift pattern except in the case of unacceptable work performance or absenteeism."
[172] It would appear to me, that clause 6.1.5(b)(i) should properly be read for the benefit of pre-2014 employees, and has more appropriate application under 6.1.5(a) than it does under 6.1.5(b). The effect of that is then the creation of different classes of employees within the Respondent. In my view, there is some reward in performing shift work, and being afforded a regular shift pattern. If an employee is found to have unacceptable work performance or absenteeism, then there is a punitive measure undertaken, in that they may then not be engaged with a regular shift pattern. This, however, was promised only to pre-2014 Agreement employees under the Agreement.
[173] To have the Agreement apply in the way the Respondent wishes for the Commission to decide, that is, as I've described in [169], would mean that there is simply no work for clause 6.4.1, and particularly 6.4.1(a) and 6.4.2(a) and (b). In a very recent concession, the Respondent suggests that it could apply, but only to people known to be shiftworkers.
[174] I am satisfied that there is a typographical error in each of 6.4.1(d), (e) and (f), and each should read with reference to 6.1.5(c). Accordingly there is a link between clauses 6.1.5 and 6.4, and I am certain that when regard is had for 6.1.5(b)(i), if an employee is rostered where their shift is to finish after 7:00pm and before midnight, they are entitled to payment of afternoon shift penalty for all hours worked for the shift.
[175] The principles in Berri afford a consideration of extrinsic material to assist where there is ambiguity, or an agreement is susceptible of more than one meaning. I have had regard to Ms Molony's evidence, together with the Form F17 statutory declaration completed by her in seeking approval of the Agreement. I have taken into account her evidence that she did not prepare the statutory declaration, and it was been prepared for her.
[176] A statutory declaration provided to the Commission by employers seeking to have an enterprise agreement approved is an extremely important document. It informs the Commission, prior to the Commission undertaking its own analysis as to the employer's evaluation of the relevant agreement against the appropriate modern award.
"Whether, on the proper construction of the terms of the Enterprise Agreement, including in particular consideration of the interaction between Clause 6.4 and Clause 6.1.5 of the Agreement, the Company is required to pay the relevant afternoon shift loading/s to an employee only for the hours worked between 7:00pm and midnight or for the whole shift?"
(a) If the shift is rostered to finish after 7pm and before midnight, the employee is entitled to payment of the appropriate afternoon shift loading for all hours of work worked by the employee until the employee is eligible for overtime rates.
(b) If the shift is not rostered to finish at or before 7:00pm, and the employee is requested and agrees to work additional hours after 7:00pm and before midnight, the appropriate afternoon shift loading shall apply only for hours worked after 7:00pm and before midnight until the employee is eligible for overtime rates.
[187] It is noted that clauses 6.4.3 and 6.4.4 of the Agreement reference further entitlements of shiftworkers. It is not a question for arbitration, however I consider, in the context of this Agreement, and in the absence of a definition, a shiftworker in the case of an afternoon shift, to be any employee who is rostered to finish after 7:00pm and before midnight. Clause 6.4.3 provides that shiftworkers are entitled to a paid 30 minute meal break during each shift, and two x 10 minute rest breaks. Clause 6.4.4 provides for hours worked by shiftworkers in excess of their normal daily or weekly shift to be paid at double time. This may be a matter for consideration by the Respondent.
[188] A very considerable amount of evidence was led by the parties as to what is, in their view, the actual temperature of certain workspaces within the Respondent. What is clear is that it is a cold environment; in some rooms the temperature is known to be less than 4 degrees, and in other rooms it may be slightly below, at, or somewhat higher than 4 degrees.
[189] The Agreement is, disappointingly, bereft of meaningful definitions. It would have been helpful to have within the Agreement a definition for what is a cold room, a shift worker and a day worker.
[190] I have had regard to the fact that at clause 5.5.1, Cold Room is in bold and contains capital letters. I note that the following three allowances within clause 5 Allowances are formatted the same way. I consider 'Cold Room' to be a title of sorts, but the real work is done in the following sentences. The following three sentences describe how and when a Cold Room Allowance will apply:
"An employee shall be paid 10% in addition to the appropriate rate for work performed in an environment artificially reduced below 4c. This allowance will only apply when an employee is requested by the employer to work continuously for a period of at least 30 mins in such environment. A minimum payment of 4 hours a day will apply."
[191] What is compelling is that the Agreement states that the 10% allowance will be paid "in an environment artificially reduced below 4c." It does not specify that it will apply in "designated cold rooms", or those nominated by the Respondent as designated cold rooms. I consider the Respondent's interpretation to have far too narrow application. Simply, if there is work performed by employees in an environment artificially reduced below 4 degrees, and the employee is requested to work in such environment for a minimum of 30 minutes, the employee will receive the allowance for a minimum of four hours per day.
[192] I consider the clause to be clear and unambiguous. If there was an intention for the cold room allowance to apply only to rooms designated by the Respondent, it would or could have been drafted in such fashion.
[193] It is known that there are presently three rooms cold enough within the Respondent's business to be described by the Respondent as a "designated cold room" attracting the payment of the allowance. On the Respondent's contention, if the allowance is only payable where the room is a "designated cold room", at the Respondent's discretion, it could nominate only one room within the business as a "designated cold room" and remove the payment of the allowance for work performed in the other two rooms, all the while the temperature is certified as below four degrees. It would be an absurd outcome.
[194] It is not the Respondent's desire or acknowledgement in describing a room as a "designated cold room" that makes it a cold room attracting the payment of the allowance. The only criteria is that it is an environment artificially reduced below 4 degrees for the requisite period of time.
[195] Whilst I am satisfied that the clause is clear and unambiguous, if it were necessary to have regard to extrinsic material to assist, it is noted that the statutory declaration of Ms Molony describes the Cold Room Allowance as:
"5.5.1 - paid 10% in addition to the appropriate rate for work performed in an environment artificially reduced below 4c."
[196] It is noted that the Commission was not informed, when the Respondent was seeking approval of the Agreement that the allowance had application in 'designated' cold rooms described by the Respondent and at the Respondent's discretion.
[197] Accordingly, the dispute in question is answered in this way:
"Whether, on the proper construction of Clause 5.5.1 of the Agreement, the Company is required to pay an additional 10% of the appropriate rate to employees that work in an environment that is artificially reduced below 4 degrees?"
Yes, there is no requirement that it be a cold room as described by the Respondent.
[198] The Applicant urged the Commission to provide commentary on the debate between the parties as to how appropriate temperatures within rooms may be properly measured. A considerable number of hours in preparation for the hearing, and the giving of evidence at the hearing was spent on the actual or perceived temperatures within different rooms at the workplace.
[199] Each party attempted to discredit each other's method of determining air temperature. The Applicant's evidence is that the Respondent uses an electronic probe coming from the ceiling which may be as high as 20 foot. Evidence suggested it may be dusty. There is evidence before the Commission that analogue thermometers are in place, which I consider extraordinary in a digital age.
[200] The Respondent suggested that Mr Burgess' methods and instruments to determine temperature were not reliable, nor is he expressly authorised to do so. Where Mr Burgess suggested the ceiling temperature probe may be dusty, he has not been present when cleaners attend the premises on the weekend.
[201] It is not within the Commission's authority to make determinations as to the air temperature in certain rooms on certain days. It is clear that the parties must, as a result of the Commission's findings in this matter, settle on an agreed method of determining and recording the temperature. It appears that the Respondent is unlikely to be convinced that temperatures have fallen below 4 degrees to warrant the payment of the allowance. Only a court of competent jurisdiction may convince the Respondent otherwise.
[202] The Commission recommends the Respondent investigate the installation of a digital thermometer on a wall of each room, which is visible to all, and preferably at approximately two metres. Regular recording of the temperature should occur. It is recommended the thermometer be placed away from doors, machinery and blowers, and not be placed in a ceiling which may be as high as 20 foot, as the temperature may not be the same as that experienced by the employees as much as 14-15 foot below the ceiling. Monthly reconciliation of the temperature data could assure both the Respondent and affected employees as to the entitlement or otherwise to the cold room allowance.
[203] The Agreement contains provisions giving some work to the common law employment contracts entered into between the Respondent and employees. The Agreement pulls up the contract entered into between the Respondent and its individual employees as to whether they have a maximum of 8, 10 or 12 ordinary hours per day that can be worked before the payment of overtime. This occurs at clauses 6.1.1, 6.1.2 and 6.1.3.
[204] The minimum hours of work for part-time employees is provided for at clause 4.4.1. It provides for a minimum of 80 hours per four-week period, up to a maximum of 152 hours per four-week period. The second paragraph of 4.4.1 preserves minimum hours for "existing part-time employees", described as "pre 2005 Terms & Conditions". In the case of Mr Burgess, his agreement with the Respondent is that he shall work a minimum of 30 hours per week.
[205] Clause 4.4.5 of the Agreement provides that overtime shall be paid to part-time employees for hours of work greater than their agreed hours of work. That clause is largely consistent with the requirement within the Award to pay additional hours at overtime rates when work is performed greater than the agreed days and hours.
[206] Clause 4.4.2 requires part-time employees to be scheduled to work regular hours on regular days in accordance with clause 4.4.1 and the Agreement provisions for permanent employees. The Award, at clause 12.3 states:
"Before commencing part-time employment, the employee and employer must agree in writing:
(a) on the hours to be worked by the employee, the days on which they will be worked and the commencing and finishing times for the work;..."
[207] It is clear the parties did not wish to be bound by the terms of the Award, and entered into alternative arrangements.
[208] I do not consider clause 4.4.2 to be ambiguous or susceptible to more than one meaning. It is my considered view that part-time employees shall be, as in they must be, scheduled to work on particular days of the week that are regular, for which I consider they must be the same days each week, which may only be changed after consultation with the employee. As for regular hours, I do not find that regular hours equates to the same starting and finishing times on each day of the week that the employee is required to attend for work. For example, a part-time employee with a minimum of 30 hours per week may be required to work three days per week at 10 hours per day. I consider that the three days per week must be determined in advance, and not changed otherwise than by consultation. For example, the employee may be required to commence at 5:00am on one day, 7:00am on another, and 3:00pm on the third day.
[209] Clause 4.4.2 states:
"Changes to the schedule shall only be made following consultation with the employees concerned. No part time permanent agreed hours of work can be reduced unless....at the request of the employee and with management's approval."
[210] Clearly, clause 4.4.2 sets in stone the part-time employees' minimum hours of work. It allows for "the schedule" to be changed. This can only occur, however, following consultation with the employee.
[211] The evidence the Commission heard relevant to how the weekly roster is set and how it is changed at the Respondent's discretion is astonishing. I understand entirely the pressures of the Respondent in meeting its customer's requirements. Evidently, there can be sizeable fluctuations in the demand for the produce, which is further impacted by weather. The Respondent's considerations, however, cannot displace its obligations to its employees pursuant to the Agreement.
[212] It is my considered view that the Respondent has treated its part-time employees as if they are casual employees, and in doing so, disregarded their rights under the Agreement to have some certainty as to days of the week that they will be working, and thereafter, the hours that they will be working. The desire to meet operational demands has been to the detriment of part-time employees.
[213] Whilst not dealt with in the evidence of the parties, in oral closing submissions the Applicant raised the issue of the likelihood of failure to pay to part-time employees wages when a public holiday falls on the employee's ordinary day of work. Section 116 of the Act states:
"If, in accordance with this Division, an employee is absent from his or her employment on a day or part-day that is a public holiday, the employer must pay the employee at the employee's base rate of pay for the employee's ordinary hours of work on the day or part-day.
Note: If the employee does not have ordinary hours of work on the public holiday, the employee is not entitled to payment under this section. For example, the employee is not entitled to payment if the employee is a casual employee who is not rostered on for the public holiday, or is a part-time employee whose part-time hours do not include the day of the week on which the public holiday occurs."
[214] It is clear that this provision, which forms part of the National Employment Standards (NES) would afford a part-time employee paid leave on a public holiday if that was their ordinary day of work. For example, if a part-time employee ordinarily works on Fridays, and would otherwise have been at work on Good Friday, but for the employer's decision to not operate on that day, the part-time employee is entitled to wages for the day's absence.
[215] This issue was not expressly dealt with before the Commission, however I strongly suspect that part-time employees working for the Respondent would not have been afforded any paid days for public holidays due to the Respondent's method of rostering part-time employees. The NES provides that if a part-time employee's hours do include the day of the week on which the public holiday occurs, the employee is entitled to payment without attendance.
[216] Relevant to the flex-up clause in Appendix C, there is no doubt that this has been inserted to afford to part-time employees additional hours, payable at ordinary rates of pay, and not at overtime rates which would otherwise be payable pursuant to clause 4.4.5 of the Agreement, and pursuant to the Award. Part-time clauses in modern awards are generally quite strict, requiring overtime to be paid when work is performed greater than the set hours of work.
[217] Appendix C is demonstratively mutually beneficial to both part-time employees and the Respondent when it is properly implemented. Part-time employees might otherwise be frozen out of being offered additional hours of work because of the expense in paying for those hours at overtime rates. Those additional hours might otherwise be offered to casual employees or labour hire employees. If a part-time employee is agreeable to work hours above their minimum hours of work without the payment of overtime, arguably it is better than not being offered the work at all.
[218] These would be necessary considerations in the decision of the Commission in examining the better off overall test (BOOT) in deciding whether to approve the Agreement. Frustratingly, again, the Respondent did not raise this issue with the Commission at the time of seeking approval of the Agreement. There is no doubt all factors would need to be weighed up by the Commission, and if the matter were before me, I would give appropriate consideration as to whether there are considerable benefits, which may include non-monetary benefits in a part-time employee being offered the additional hours and choosing to accept the additional hours, against the potential of not being offered the additional hours because of the expense of overtime rates. All appropriate considerations would need to be weighed against each other.
"Rosters will be set and any variation to the roster to be by agreement between the Respondent and the relevant employee. Variations to rosters will only apply in extreme cases to particular circumstances, e.g. religious or personal beliefs."
[224] In my view, these two sentences set out how a variation of the roster may occur at the initiative of the employee, not of the Respondent. This is because it is the employee nominating, for example, a religious belief not to work a certain day.
[225] The clause then continues as follows:
"Variations to rosters by the employer shall normally be given on 48 hours notice, however rosters may be varied by less than 48 hours notice in cases of absenteeism or emergent circumstances. In emergent circumstances only, if less than 48 hours notice is given double time applies."
[226] In my view, these two sentences set out how a variation of the roster may occur at the initiative of the Respondent, not the employee. This is because it allows the Respondent to vary the roster by the giving of 48 hours' notice for any reason, but less than 48 hours in the case of absenteeism or emergent circumstances. Only in emergent circumstances, where less than 48 hours' notice has been given is double time applicable.
[227] Mr Roughan confirmed in evidence that the Respondent does not pay double time to employees where less than 48 hours' notice is given and the roster has been required to be varied due to emergent circumstances.
[228] The Respondent considers that it is entitled to publish a weekly roster and employees - all employees - should review the roster daily to learn if there have been variations to it. The Commission heard evidence that when employees are at work, they are constantly reviewing the roster to see if changes have been made. On occasions they'll be informed orally by a supervisor, or they may occasionally be contacted by telephone to be notified of changes, but on other occasions if they didn't physically observe the changes on the roster while at work, they would not have otherwise have known.
[229] Mr Burgess gave evidence of having arrived for his rostered start time of 5:00am, only to be told that it had been changed to 6:00am. He requested, and was granted the opportunity to commence work at 5:00am, rather than idly waiting for the clock to strike 6:00am.
[230] Having regard to all of the relevant clauses within the Agreement, including but not limited to clause 4.4.2, 6.1.4 and Appendix C, part-time employees are afforded the protection, within the Agreement to regular working days and regular hours on those regular working days. The Respondent has, in my considered view, treated the part-time employees as a highly flexible workforce, without regard to the obligations it is required to meet within the Agreement.
[231] Part-time employees are afforded certainty as to days of the week they shall perform work, and regular hours. It is evident that their right to security over the days and hours that they work, and the additional hours they are requested, but demonstrably directed to work at ordinary rates, has been sacrificed over the Respondent's desire to meet its operational requirements. I determine that there has been an extraordinary lack of consultation required to pursuant to clause 4.4.2 when changes to the schedule have been made by the Respondent.
"Whether, on the proper construction of Clause 4.4.2 of the Agreement, the Company is required to schedule part-time employees to work on regular days and regular hours?"
Yes, the Company (Respondent) is required to schedule part-time employees to work on regular days and regular hours.
[233] The Respondent is advised to have due regard to my remarks relevant to clauses 6.1.4 and Appendix C, and its obligation to consult with employees pursuant to clause 4.4.2 when changes to the schedule are sought.
[234] For the reasons given above, the questions for arbitration have been answered.
[235] I understand the parties are presently bargaining for a replacement enterprise agreement, utilising the assistance of another Member of the Commission pursuant to s.240 of the Act.
Final written submissions of the Applicant, 26 November 2019.
Final written submissions of the Respondent, 27 November 2019.
[1] Witness statement of Adrian Burgess, 16 September 2019, Paragraphs [7]-[8].
[2] Transcript of proceedings, 28 October 2019, PN189.
[4] Witness statement of Adrian Burgess, 16 September 2019, Paragraphs [11]-[13].
[5] Transcript of proceedings, 28 October 2019, PN209 - PN212.
[7] Witness statement of Adrian Burgess, 16 September 2019, Paragraph [17].
[11] Transcript of proceedings, 28 October 2019, PN81.
[14] Witness statement of Anthony Hornby, 16 September 2019, Attachment A.
[16] Transcript of proceedings, 28 October 2019, PN488 - PN490.
[17] Witness statement of Anthony Hornby, 16 September 2019, Paragraph [42].
[18] Witness statement of Daniel Bradshaw, 16 September 2019, Paragraph [8].
[21] Witness statement of Peter Roughan, 10 October 2019, Attachment 12.
[22] Transcript of proceedings, 28 October 2019, PN998
[26] Submissions of the Applicant, 16 September 2019, Paragraphs [65]-[78].
[27] Mrs Crockett's Kitchen Pty Ltd - Employees - Certified Agreement 2005, Clauses 6.1.3(a)-(c).
[28] Chilled Foods McK Pty Ltd (Trading as Salad Fresh) NUW - Employees - Enterprise Agreement 2010, Clauses 6.4.1(d)-(f).
[29] Chilled Foods McK Pty Ltd (Trading as Salad Fresh) NUW - Employees - Enterprise Agreement 2010, Clause 6.1.5.
[30] Transcript of proceedings, 29 October 2019, PN1561.
[33] Final written submissions of the Applicant, 26 November 2019, Paragraph [49].
[35] Final written submissions of the Applicant, 26 November 2019, Paragraph [21].
[38] Submissions of the Applicant, 16 September 2019, Paragraph [21].
[40] Submissions of the Applicant, 16 September 2019, Paragraph [29].
[43] Final written submissions of the Applicant, 26 November 2019, Paragraph [17].
[44] Witness statement of Peter Roughan, 10 October 2019, Paragraph [11].
[58] Transcript of proceedings, 29 October 2019, PN1267.
[66] Witness statement of Karen Molony, 10 October 2019, Attachment 1.
[76] Transcript of proceedings, 29 October 2019, PN2092.
[84] Final written submissions of the Respondent, 27 November 2019, Paragraph [4].
[86] Transcript of proceedings, 28 October 2019, PN732 - PN735.
[88] Final written submissions of the Respondent, 27 November 2019, Paragraph [20]
[89] Transcript of proceedings, 28 October 2019, PN944.
[90] Final written submissions of the Respondent, 27 November 2019, Paragraph [21].
[93] Final written submissions of the Respondent, 27 November 2019, Paragraph [22].
[99] Respondent's outline of submissions, 10 October 2019, Paragraphs [44]-[48].
[102] [2014] NSWCA 184 at [71] - [85].
[103] Manufacturers' Mutual Insurance Ltd v Withers (1988) 5 ANZ Ins Cas 60-853 at 75-343.
[104] Kirin-Amgen Inc v Hoechst Marion Roussel Ltd [2004] UKPC 6; [2005] 1 All ER 667 at [64].
[105] Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at [78].
[106] Charter Reinsurance Co Ltd v Fagan [1997] AC 313 at 391 per Lord Hoffman, approved in Campbell v R [2008] NSWCCA 214; 73 NSWLR 272 at [48] (Spiegelman CJ, Weinberg AJA and Simpson J agreeing)
[107] Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407; 76 NSWLR 603 at [17] cited in Mainteck Services Pty Ltd v Stein Heurtey SA (2014) 310 ALR at [71] - [85].
[108] Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; 219 CLR 165 at [40].
[109] Kucks v CSR Limited [1996] IRCA 166; (1996) 66 IR 182 at 184.
[110] Kucks v CSR Limited [1996] IRCA 166; (1996) 66 IR 182 at 184.
Printed by authority of the Commonwealth Government Printer
National Union of Workers
PMFresh Pty Ltd T/A PMFresh [2020] FWC 1388
(1996) 66 IR 182
The Commission answered all three arbitration questions in the Applicant's favour: whole-shift afternoon loading applies to shifts rostered to finish after 7:00 pm and before midnight, the cold room allowance is not restricted to employer-designated rooms, and part-time employees must be rostered on regular days and regular hours. The Commission did not determine the actual temperatures of particular rooms: [186]-[202], [232]-[234].
[26] Mr Burgess stated that in March 2019, union members and delegates, with the support of the union, started a petition about the Cold Room Allowance issue. About 130 employees signed the petition, asking the Respondent to pay all workers who perform 30 minutes or more work in an environment less than four degrees a 10% allowance as provided for by clause 5.5.1 of Agreement. A copy of the petition was annexed to Mr Burgess' witness statement.[9] Employees also sought enforcement of clause 5.5.1 in a log of claims during enterprise bargaining in 2019. The log of claims served on the Respondent dated 10 May 2019 was also annexed to Mr Burgess' witness statement.[10]
[27] Mr Burgess stated that he is trained in how to calibrate, use and read thermometers, and is signed off on thermometer usage. In about June 2018, Mr Burgess started to document the temperature in the relevant areas, and in the months prior to the dispute he was recording it almost daily on the "Pre-Op" documents (pre and post-operative and loose items checklists). Mr Burgess stated the following in respect of recording the temperature:
Each morning he is required to calibrate the blue food-grade thermometer/s on the calibrating thermometer. He believes this thermometer is externally calibrated;
In Area 3 - low care, there is a thermometer on the wall directly above the hole where product is pushed into High Care. The way he monitors the temperature in Area 3 is by going and looking at the thermometer on the wall while at the same time he holds the blue food grade thermometer (which he has previously calibrated) up in the atmosphere. He then looks at both thermometers to ensure they are similar;
The temperature in Area 3 - low care leafy is consistently between 3.5 - 3.9 degrees. It can go above four degrees, but it will come back down again. Approximately six months ago, the Respondent started turning the blowers in low care leafy off around 9:00pm and turning them on again at 7:00am. His monitoring showed that despite this, by 10.30am the room was below four degrees; and
In Area 3 - high care, it is always colder than other areas because there is an extra blower and it is more contained and completely blocked off. In Area 3 - high care, the average temperature is around 3.2 degrees and, sometimes as low as 2.5 degrees.
[28] In examination-in-chief, Mr Burgess stated that he believes the thermometer he was using the record the room temperatures is fit for that purpose.[11]
[29] Mr Burgess stated that on 12 September 2019, he was told by the Respondent that he was no longer able to record temperatures on the "Pre-Op" documents. He then began to write the temperatures on a piece of paper kept in his locker. Mr Burgess stated that on the same day, the Respondent's lawyer (Mr McCarthy) attended the premises and took video footage and photos of Area 3. It was stated that on 12 September 2019:
Mr Burgess had taken a temperature reading off the wall thermometer in Area 3 at 11:15am (which read 3.6 degrees);
Mr McCarthy came into Area 3 between 11:30am and 11:45am and took a photo of the thermometer (which read 4.5 degrees);
Mr Burgess took a further thermometer reading at 12:15pm that read that the temperature has fallen below four degrees again; and
Mr Burgess contacted an employee of the Applicant about the above as he was concerned that the reading had been staged for Mr McCarthy's photo.
[30] Mr Burgess gave evidence that the food manufactured, and the raw ingredients used to make the food, is required to be stored at temperatures between one and four degrees. This is stipulated on the product labels. In examination-in-chief, Mr Burgess gave evidence that during the whole production process of handling and storage of the products, the products are to be kept below five degrees, but should be kept in temperatures lower than this as certain products can rise above five degrees once they have been chilled.[12] Mr Burgess stated that storage and manufacturing of the food and products occurs in the same rooms, for example in Area 2 (batching and mixing).[13]
[35] Mr Hornby stated that rosters get posted weekly and that they change at least a couple of times. His evidence is that changes are often made to the roster without management telling employees. Mr Hornby stated that, in his view, the roster gets set in the same way for permanent and casual workers in that the roster can change from week to week, and there does not appear to be set hours or days for part-time workers. It was stated that roster changes can include employees being directed to work past their shift, which causes them not to receive a 10 hour break before their next shift, or a change in the start time as significant as six hours. Mr Hornby stated that he witnesses part-time employees in Area 5 rostered to finish at 6:00pm get asked to stay back until 10:00pm, or until the work is done, and they are not considered 'flex-up' or overtime hours for staying back. In examination-in-chief, Mr Hornby rejected Mr Roughan's statement, as below at [75], that Mr Hornby was referring to "events that happened in previous times".[16]
[36] Mr Hornby recalled that non-payment of the Cold Room Allowance was raised during an enterprising bargaining meeting in 2014 by Ms TeMoho. He recalled that Ms TeMoho raised that it is cold in Area 3, but workers were not being paid the Cold Room Allowance. Mr Hornby stated that Mr Roughan said in reply words to the effect, "the temperature is not a bargaining issue", and "I'll make sure the temperature stays above four".[17] Mr Hornby stated that it is well known amongst the production workers that Areas 3 and 4 are colder than four degrees.
[37] Mr Hornby stated that none of the areas on the site are referred to as 'designated cold rooms'. He stated that the areas in the factory are referred to be their area, line or function.
[48] It was submitted that as the parties are advancing rival contentions as to the wording and interaction of clauses 6.4 and 6.5.1(b), the Commission should have regard to the admissible extrinsic evidence to ascertain the objective intention or purpose of the parties per Berri. [25]
[49] The Applicant submitted that the history and development of the 'spread of hours' and 'shift work' clauses through previous agreements covering employees of the Respondent provides contextual guidance as to the meaning of clauses 6.4 and 6.1.5. It was submitted that:[26]
• The 'spread of hours' clause in the 2005 Agreement (clause 6.1.3) provided for when ordinary hours could be worked between, when the daily spread of hours could be altered and for penalty rates for hours worked outside the relevant spread unless those hours formed part of the definition of afternoon or night shift work;[27]
The starting point for the proper construction of the interaction between clause 6.4 and clause 6.1.5 is clause 6.4 as it is the clause that provides entitlements for employees working shift work;
Any employee can work shift work for the purposes of clause 6.4;
Employees engaged in production and dispatch at the Morningside site work hours that fall within the definition of 'afternoon shift';
If any employee works an afternoon shift as defined in 6.4.1(d) they are entitled to be paid the relevant afternoon shift loading for the whole shift;
The role and intention of clause 6.1.5(a) and (b) in the Agreement is limited to providing penalty rates payable when employees who are not shift workers work outside the spread of hours, and in circumstances where overtime would not otherwise be payable under clause 6.1 or 4.4.5 or 4.3.1;
The payroll document cannot be used to rewrite the clear intention of clause 6.4 or to give effect to an externally derived concept of the Company's intentions of the role of clause 6.1.5; and
• A finding that the shift loading is payable for the entire shift is an industrially sensible outcome. Such an interpretation is consistent with a common industrial understanding of the application and operation of shift loadings, including under the relevant Award.[33]
[55] In oral closing submissions, the Applicant rejected the Respondent's submissions that the Agreement should be read to mean that only employees who have been specifically employed to work shift work would be entitled to payment of all hours at the relevant afternoon shift rate. It was submitted that to do so would allow the Respondent to roster employees to work an afternoon shift, but not pay them the appropriate loading for all of the hours worked unless the employee was specifically nominated as an afternoon shiftworker.
[61] Relevant to what is the factual temperature in various rooms within the Respondent's business, and at various times when employees are present, the Commission made it clear that it was not part of the dispute or a matter that the Commission could determine or order that certain actual temperatures required the payment of the allowance. The following was discussed in oral closing submissions:
While the Agreement may allow permanent part-time employees to be rostered up 10 or 12 maximum daily hours, it is not open to the employer to request that permanent part-time employees stay back beyond their rostered hours without utilising either the flex-up clause or paying overtime; and
• If an employee is told or directed to stay back, or not reasonably able to refuse the offer of additional hours, the 'flex up' clause is not enlivened.[43]
[76] Rosters are currently posted on the designated board on a Tuesday, and are then updated each day to reflect any changes either from sales variations, machine breakdowns or supply issues. Sales variations of 20% are not unusual, breakdowns are a fact of life with aged equipment, and supply issues are frequent due to supplier consolidations. Further, the weather impacts on produce availability.
[77] Mr Roughan set out the evolution of the part-time provisions and associated flexibility clauses through previous bargaining negotiations and agreements.[47] Annexed to Mr Roughan's statement were log of claims documents between 2010 and 2016, where in the course of bargaining for various agreements, issues associated with part-time employment were raised by the Applicant.[48] The 'flex up' provision in Appendix C of the Agreement was a joint compromise with the Applicant, as an increase in the number of part-time employees could only occur with the Respondent's ability to apply the "broad flexibility it is utilising."
[78] Mr Roughan considered that the rostering issues have been a discussion point over the years, mainly from long terms employees who "have not ever fully embraced" the 2014 Agreement and the Agreement's agreed flexible changes to the rostering of hours.[49] It is Mr Roughan's evidence that the Part-time Hours Dispute was initially an issue about the manner the Respondent was rostering employees (such as late posting and changes), but "the new crop of NUW Organisers" turned it into a "cash promise/vote pleaser" prior to the next bargaining negotiations.[50]
[79] Mr Roughan stated that if the Applicant's claim succeeds, it is expected the Respondent would:
Suffer an increase in costs;
Have to review and negotiate employment conditions with part-time employees;
Likely have to reduce part-time employees' weekly hours;
Need to reconsider hiring employees on a part-time basis;
• Increase casual employee numbers and utilise them as the main workforce to maintain cost efficient and flexible labour.[51]
[80] I informed Mr Roughan that in the Commission's determination of the issues in dispute, the Commission cannot have any regard to the consequences to the Respondent of the Applicant succeeding in its application.
[81] In respect of the Cold Room Allowance dispute, Mr Roughan stated that the allowance is only paid to employees who work in 'designated cold rooms', being inbound receivals, despatch and the WIP rooms. His evidence is, and I understand that it is not disputed that these three areas are intentionally reduced and maintained below four degrees. The phrase 'designated cold room' is a phrase that has recently come to be used at the site as a means of referring to the work areas the Respondent knows and accepts as being "genuine Cold Rooms".[52]
[82] The Respondent uses a central electronic monitoring system, which is a SCADA system, to record temperature data at the site. Mr Roughan's evidence is that the processing areas (Areas 1 to 5) are not set to run below four degrees. It is Mr Roughan's contention that Mr Burgess would not have been in a position to know about or appreciate the correct way to take room temperatures because the thermometer used by Mr Burgess is not fit for purpose as it may have a calibrated variance of plus or minus one degrees, and the location he records the temperature is in direct line of airflow.
[83] Mr Roughan stated that Mr Burgess is correct above at [30] that certain raw materials need to be stored in temperatures less than four degrees. However, the materials do not necessarily need to be kept below four degrees during processing.
[84] It is Mr Roughan's contention that the Applicant has led the argument that the Cold Room Allowance should be extended to processing areas of the factory as a "promise of cash".[53] He does not believe the Agreement provides for the payment of the Cold Room Allowance outside the 'designated cold rooms' to the processing areas, and the Agreement's reference to the Cold Room Allowance is more than a decade old. He does not recall any conversations prior to very recently where he has been approached by employees about paying the Cold Room Allowance.
[85] In respect of the Afternoon Shift Loading Dispute, Mr Roughan stated that the Respondent's payment rules for an afternoon shift loading have applied at the Morningside site for an extended period of time, since at least before 2010. He stated:
[90] In cross-examination, relevant to the part-time employee issue, Mr Roughan explained that once a weekly roster has been published, there could be an "allowable" two hour variation to a part-time employee's start time.[58] He explained that an employee might have been rostered to commence at 8:00am, but that might need to be changed to 10:00am if, for example, there was a cancellation of orders. He was asked where that right to change a shift by a two hour variance could be found. The following exchange occurred:[59]
[104] The minimum hours offered to a part-time employee is based on historical data and consideration of business fluctuation because of seasonal demand. Ms Molony submitted that there is not a methodical roster where staff work the same days and same hours on a weekly basis, as customer requirements fluctuate seasonally and, in most instances, daily. Ms Molony submitted that if the Applicant's claim succeeds the Respondent would lose the flexibility it currently has and the conditions that apply to the part-time employees work would be significantly impacted. It was submitted that the days, hours and shift patterns would need to be reviewed to ensure that the Respondent "could continue to operate without incurring additional cost".[70]
[105] Ms Molony stated that to her knowledge the Cold Room Allowance has only ever been applicable, and has only ever been paid, for three areas of the site that "we in the business deem 'designated Cold Rooms'".[71] It is Ms Molony's evidence that the phrase is used to differentiate between "Cold Rooms" and processing areas (which is the category for all other areas). Ms Molony stated that Areas 1 to 5 of the factory are all considered processing areas, and there are three "Cold Room" areas (inbound receivals, despatch and WIP). A site map was annexed to Ms Molony's witness statement identifying these areas.[72]
[106] The Respondent uses a SCANDA system to monitor temperature data. Ms Molony stated that she does not recall the issue of the Cold Room Allowance being raised by Ms TeMoho as described by Mr Burgess above at [22]. It was submitted that a hand-held thermometer is not an approved instrument for monitoring room temperatures and the SCADA data, which is the approved method of capturing site temperature information, is the information to be referenced for the purpose of determining work area temperatures.
[107] In around August 2019 she was made aware that Mr Burgess was using "company controlled documents" to record temperatures.[73] All employees that do "Pre-op" are trained in calibrating their hand-held thermometers. This is a process that is common to all areas and a requirement of the start-up operator for each processing area. These thermometers are the tool used for measuring the temperature at various process and manufacturing points. Ms Molony stated that the processing areas (Areas 1 to 5) are not used to assist or aid in reducing the temperature of mixed goods to below five degrees.
[108] In respect of the Afternoon Shift Loading Dispute, Ms Molony stated that the Respondent applies the afternoon shift loading to the hours worked between 7.00pm and midnight "which is an historical method of payment and has been in effect for an extended period of time".[74] Where an employee starts a shift at 1:30pm or earlier, then the shift loading is paid only for the hours worked between 7:00pm and midnight. However, where an employee starts a shift at 2:00pm, the afternoon shift loading is paid for all hours worked. Ms Molony stated that when she became aware of this Afternoon Shift Loading Dispute she was "surprised" because it "is an historical method of applying the loading at the site and I did not believe there was an issue to dispute".[75]
[109] Ms Molony stated that if the Applicant's claim in respect of the Afternoon Shift Loading Dispute succeeds it would create higher costs for the Respondent, in turn impacting employees as the Respondent would need to reduce the operational hours of the site to finish before 7:00pm to remain cost effective.
[110] Ms Molony acknowledged that Mr Hornby stated that from 1 July 2012 to 26 February 2013 he was paid an afternoon shift loading for all the hours worked, as above at [32]. It is her evidence that it was paid because his shifts were commencing at 2:00pm.
[111] In cross-examination, Ms Molony confirmed that the MCK payment rules document is a payroll document, and it is not a document published for the Respondent's employees. They do not have access to it, and it was not provided to them when they voted for respective enterprise agreements.
[112] Ms Molony was asked what she understood in clause 6.1.5 "Unless the hours form part of the definition of shift", to which she answered, "I don't know. I don't know what he definition of shift is."[76] When asked again if she knew what it means, she responded, "No, I am saying that as per the pay calculation record that we use, and it's our tool, that we use that tool to determine when a person is entitled to shift allowance, yes."[77]
[113] Ms Molony confirmed that there is nothing in the Agreement that states that if you commence work before 2:00pm, you are not entitled to the shift loading for all hours.[78]
[114] Relevant to the Part-time Hours Dispute, Ms Beynon took Ms Molony to her evidence where she had stated that the Respondent directs employees to stay back after their ordinary hours. Ms Molony stated, "We wouldn't direct someone to stay back, we would ask them to stay back." She agreed that she did not have first-hand knowledge as to how an employee's supervisor might ask, and not direct an employee to work additional hours.
[115] Ms Molony stated that if an employee was an eight hour person and was asked to stay back and work additional hours, they would be paid overtime for hours above eight hours. If they were a ten hour person, it would require more than ten hours to be worked before the payment of overtime. For a 12 hour person, it would require more than 12 hours to be worked before the payment of overtime.
[116] Ms Molony stated that the roster is the schedule that sets the part-time employees' weekly hours. She agreed that the roster can change daily, and employees 'should' be notified verbally of the change. When asked if they are consulted about the change, she answered, "I would believe so, when they are asked or they are notified of the change." She said she believed notification is the same as consultation.[79]
[117] Ms Molony repeatedly stated that she had expectations that the supervisors would consult with employees prior to making changes to the roster, which might happen daily, but conceded that she does not have direct knowledge as to whether that happens or not. Further, she conceded that the Respondent does not give 48 hours' notice of changes to rosters.[80] The Respondent does not pay double-time to employees where it does not give 48 hours' notice of the change of roster.
[118] Ms Molony conceded that she did not have direct knowledge as to whether the flex-up clause was properly explained to employees when voting for the 2014 agreement.[81] Ms Beynon put the following to Ms Molony:[82]
[128] The Respondent submitted that in bargaining negotiations for the 2014 Agreement, the Applicant and its members made a claim for improvements to shift allowance provisions, as evidenced by the Applicant's 2014 log of claim annexed to Mr Roughan's witness statement. It was submitted that this claim was considered and it is already seen that the employees and the Applicant sought successfully to have the Respondent agree to significantly increase the number of employees employed on a permanent part-time basis as part of the Applicant's "job security" campaign. It was submitted that during the bargaining negotiations for the 2014 Agreement it was agreed by the Applicant and the Respondent, as evidenced during Mr Hornby's cross examination,[86] that the claims were "dealt with together" on a "cost effective basis" by the parties:
Agreeing to retain the previous agreements provisions under which the Afternoon Shift Loading was paid only for ordinary hours worked between 7:00pm and 12:00am; and
By going one step further and agreeing that the Afternoon Shift Loading payable to employees for ordinary hours of work after 7:00pm would be reduced for new employees from 18% to 15%. This was achieved by inserting Clause 6.1.5(b) into the 2014 Agreement.
[129] It was submitted that the Agreement was agreed to between the parties and that included retaining the 2014 Agreement amendments regarding the payment of Afternoon Shift Loading.
[130] In applying the principles in Berri,[87] the Respondent submitted that:
[150] The Respondent submitted that, in compliance with clauses 4.4.1 and 4.4.2, it:
Is advising its part-time employees of the minimum prescribed times they will be required to work over the roster period;
Is providing its part-time employees advanced notice of when their minimum hours of work are to be performed; and
Is setting the "regular hours" and "regular days" when its part-time employees will perform their work.
[151] The Respondent submitted that the Applicant's submission about the meaning of word "offer" in Appendix C as above at [71] should be rejected, and put that the wording "the Employer will offer" places a requirement on the Respondent to offer its part-time employees all available additional hours of work throughout each week in addition to the scheduled hours set by the weekly roster.[95] It was submitted that this approach is consistent with the intention of the parties in the when Appendix C was introduced in the 2014 Agreement. The Respondent submitted that Appendix C does not prescribe that an employee has a freedom to choose to work or not work the additional hours.[96]
[152] It was submitted that there is no limitation on the Respondent's discretion, as submitted by the Applicant above at [67], in relation to employees' hours of work "under Clause 4.4.1 arising from Clause 4.4.2".[97]
[153] The Respondent submitted that an important feature of the Agreement's part-time hours provisions is that they are different to and substantially more flexible than the Award's terms regarding part-time employees' hours of work. It was submitted that the Respondent understands the Applicant is effectively seeking a narrow interpretation of clause 4.4.2 of the Agreement that would reflect the "inflexible" approach prescribed by the Award.[98]
[154] In respect to the meaning of the word 'regular', the Respondent cited the Oxford Dictionary's synonyms for the word 'regular', the Cambridge Dictionary's definition and the Macquarie Dictionary's definition submitting that it is important to consider that the various meanings of the word 'regular' demonstrate that the word does not necessarily mean what the Applicant seeks to have it mean,[99] as above at [66].
[155] In oral closing submissions, the Respondent criticised the Applicant for effectively "washing its hands" on the flex-up arrangements, given it was the Applicant's wishes for its members that part-time employees be offered additional work before it was offered to casual and labour hire employees. It was submitted that if the Applicant was correct on this issue, it may require the Respondent to make payable overtime rates for additional hours worked.
[156] It was submitted that perhaps Mr Roughan had, in some parts of his answers in cross-examination, been confused, and appeared to make concessions when he didn't understand the question put to him. It was submitted that greater weight should be given to his answers in re-examination.
[165] Quite simply, the MCK payment rules are not and never have been incorporated into the Agreement or the 2014 Agreement. The MCK payment rules do not have any application at all to the employees covered by the Agreement, yet the Respondent has and continues to apply them as if they do. The Respondent continues to apply them as if the employees covered by the Agreement have agreed to them.
[166] The evidence is that when employees have asked why they do not receive afternoon shift loading for all hours worked, they are told that they must work at least the majority of their hours of work after 7:00pm to be entitled to all hours worked by them to be paid with the afternoon shift loading. Even on the Respondent's interpretation of the Agreement, it does not equate.
[167] The authority in Berri requires a determination as to whether in construing an enterprise agreement, there is a plain meaning, or it is ambiguous or susceptible of more than one meaning. The Applicant says that it is clear that the afternoon shift clause means that all hours worked on afternoon shift are paid with the afternoon shift loading. The Respondent urges the Commission to find that the insertion of the new clause in the 2014 and this Agreement mean that only hours worked between 7pm and midnight attract the afternoon shift loading.
[168] I am satisfied that clause 6.1.5 Spread of Hours is ambiguous or susceptible of more than one meaning. I agree that it is not entirely clear. Further, it is made even more ambiguous or susceptible of more than one meaning when regard is had for clause 6.4 Shift Hours.
[169] In my view, read alone, the way that 6.1.5(a) is to be read is that employees working between 7pm and midnight will attract an 18% penalty for those hours. If the employee was required to work over their rostered hours, those additional hours will be paid at overtime rates. That is, unless those hours then slipped into the definition of nightshift, which is described at clause 6.1.5(c) as a shift finishing after midnight.
[170] For example, if an employee commenced at 4:00pm and was due to finish their shift at 11:00pm, if regard was had only for this clause, the employee would be paid ordinary rate for work between 4:00pm and 7:00pm, and then attract an 18% penalty for the work performed 7:00pm to 11:00pm. Having then worked seven hours, if they were an "8 hour person", they would work 11:00pm to midnight still attracting an 18% afternoon shift penalty. If they then worked beyond their 8 hours they would attract overtime rates, having exhausted their maximum of 8 ordinary hours per day. If, however, they were a "10 hour person", the additional two hours could be worked midnight to 2:00am attracting a 20% night shift loading.
[171] I consider, however, that this must be read with a consideration of clause 6.4, which provides that shift work may be worked by any employee, [my emphasis], and for an afternoon shift it attracts an 18% loading (for a pre-2014 agreement employee). Turning back to clause 6.1.5(b)(i), it states:
[177] In Ms Molony's statutory declaration, a table is provided at question 3.4, where the deponent is asked, "Does the agreement contain any terms or conditions of employment that are more beneficial than equivalent terms and conditions in the reference instrument(s)...." The table nominates clause 6.4.2 providing for 18% and 20% shift loadings for applicable employees, being the afternoon and night shift loadings for pre-2014 agreement employees. It contrasts the entitlement in the Award at clause 31.2(b) of the Award at 15%.
[178] When asked at question 3.5 if the agreement contains any terms that are less beneficial than equivalent terms and conditions in the reference instrument (the Award), only two matters were raised by Ms Molony, namely the casual loading of 23% as against 25%, and higher duties at four hours as against two hours.
[179] At no stage did the Respondent seek to inform the Commission that in its view, the Agreement application of afternoon shift loading would only apply to hours worked between 7pm and midnight, as against the Award's definition of afternoon shift meaning any shift finishing after 6:00pm and at or before midnight, and the shift loading applying to all hours worked on afternoon shift.
[180] It appears that not only did the Respondent fail to alert the Commission as to how it understood the afternoon shift loading to apply, it did not explain to employees how it came to have those views. On the evidence before the Commission, the Respondent has been using the MCK payment rules at its discretion, believing it to be an authoritative document that overrides the terms of the Agreement. Both of the Respondent's witnesses agreed that there is nothing in the Agreement that dictates when and how the Respondent's rule regarding commencing work at 1:30pm and 2:00pm applies. I agree with the submissions of the Applicant that it is something that has simply been made up. This historical document has been incorrectly applied and adopted, it seems, without any industrial knowledge as to the hierarchy of industrial instruments.
[181] The failure of the Respondent to inform the Commission that it believed employees had agreed to make a bargain that forfeited their rights to afternoon shift loading for all hours worked by them prior to 7:00pm cannot be excused by the Respondent's long-standing application of the MCK payment rules.
[182] Principle 15 in Berri is clear that an absence of a complaint by the employees does not equate to a common understanding that supports the Respondent's interpretation of the Agreement.
[183] While I have found that there is ambiguity in clause 6.1.5(a), when read with clauses 6.1.5(b)(i) and 6.4.1, and having regard to all of the circumstances and relevant extrinsic material, I find that the Agreement does provide for a payment of afternoon shift loading for all of the shift where any shift is rostered to finish after 7:00pm and before midnight. Where it was argued by the Respondent that day workers would only be entitled to afternoon shift loading for hours between 7:00pm and midnight, and not for the hours worked before 7:00pm, and its late concession that shift workers should, pursuant to clause 6.4.1 be paid for all hours of work, I consider that the Respondent's interpretation still does not give clause 6.4.1 its relevant weight.
[184] Recognising that there is poor wording in clause 6.1.5, I consider that inappropriate weight has been given to the requirement for an afternoon shift to be rostered to finish after 7:00pm and before midnight. In my considered view, when a shift is rostered to finish after 7:00pm and before midnight, it becomes an afternoon shift, which may be worked by any employee, whether they are traditionally a day worker, a typical shift worker, or a casual worker. In that circumstance, they will be entitled to the relevant afternoon shift loading for all of the hours worked by them, until they work enough hours to become entitled to overtime rates.
[185] Where an employee is not rostered to work a shift that is to finish after 7:00pm and before midnight; for example, the shift is to finish at or before 7:00pm, in the event that they work additional hours after 7:00pm and before midnight, they will be entitled to the relevant afternoon shift loading for those additional hours only.
[186] Accordingly, the dispute in question is answered in this way:
[219] The Respondent notes that it was largely the Applicant who sought the introduction of Appendix C into the Agreement.
[220] As I have said above, when properly implemented, Appendix C may be beneficial to a part-time employee. It requires the part-time employee to consider whether the additional hours offered by the Respondent meet three criteria; the part-time employee must be available, have the requisite skills and competency, and is able to maintain flexibility over their start and finish times. This must be contrasted with a direction given by an employer to an employee that they must work a reasonable amount of overtime.
[221] The requirement to offer the additional hours, where practical, naturally requires consideration of the part-time employee in determining whether to accept the offer. Appendix C does not detail the manner in which the part-time employee may accept or refuse the offer. It does not, for example, detail that the employee must accept the offer and not unreasonably refuse the offer. The part-time employee, may, for example, decide not to accept the flex-up hours because they do not consider that they are, in that instance, able to maintain flexibility over their finish time. They may have a preference to be directed to work additional hours pursuant to clause 4.4.5 which would then attract the payment of overtime.
[222] The evidence is clear that part-time employees of the Respondent are not being afforded the opportunity to indicate their acceptance of the offer made by the Respondent to work additional flex-up hours, because for the most part, it is not being put to the part-time employee as an offer. I accept the evidence of Mr Burgess that employees are being directed to work the additional hours because of the operational requirements of the Respondent. Ms Monoly's evidence on this issue is telling, and it was only in cross-examination that she sought to resile from the supervisors directing employees to work the additional hours. Notably, she was unable to say how the supervisors inform part-time employees to work flex-up hours because she has not observed them; she expects them to request and not direct. Mr Roughan's evidence is that employees are not forced to accept the additional hours, but he is not the one asking, and I do not consider he knew at the hearing how forcefully or not the supervisors are requiring part-time employees to perform flex-up work.
[223] Clause 6.1.4 is as follows:
[232] Accordingly, the dispute in question is answered in this way: