Fair Work Act 2009

s.602 - Application to correct obvious error(s) etc. in relation to FWC's decision

Steinhoff Asia Pacific Pty Limited T/A Freedom and Shop, Distributive and Allied Employees Association

Application for a correction to a decision pursuant to s.602 - Freedom Retail Enterprise Agreement 2020.

[1] A joint application has been made by Steinhoff Asia Pacific Pty Limited T/A Freedom (Freedom) and the Shop, Distributive and Allied Employees Association (SDA) for a correction to a decision pursuant to s.602 of the Fair Work Act 2009 (Cth) (Act). The decision approved the Freedom Retail Enterprise Agreement 2020 (Agreement) on 4 May 2020.[1]

[2] The parties contend that the Agreement as lodged for approval contained an obvious error. The error arises in respect of the loading payable for ordinary hours worked on a public holiday under clause 15.4.

[3] Clause 15.4 of the Agreement provides that full-time and part-time employees will be entitled to an additional loading of 225% of the ordinary hourly rate for public holidays worked. In the case of casual employees, the loading is expressed as an additional 250% of the ordinary hourly rate (inclusive of the casual loading). The parties contend that the application of clause 15.4 erroneously results in full-time and part-time employees receiving a payment of 325% for public holidays worked, and 350% for public holidays worked by casuals.

[4] The parties submit that clause 15.4 should state that the additional loading for ordinary hours worked on public holidays is 125% of the ordinary hourly rate for full time and part time employees and 150% of the ordinary hourly rate for casual employees (inclusive of the casual loading). It is submitted that the correction sought is consistent with the explanation provided to relevant employees during the Agreement making process, that the loading for public holidays worked would align with the General Retail Industry Award 2010 (Award). The parties rely upon a comparison document filed with the application for approval of the Agreement in support of this contention and submit that employees covered by the Agreement will not be disadvantaged by the correction sought.

[5] Section 602 of the Act states:

"Correcting obvious errors etc. in relation to the FWC's decisions

(1) The FWC may correct or amend any obvious error, defect or irregularity (whether in substance or form) in relation to a decision of the FWC (other than an error, defect or irregularity in a modern award or national minimum wage order).

Note 1: If the FWC makes a decision to make an instrument, the FWC may correct etc. the instrument under this section (see subsection 598(2)).

Note 2: The FWC corrects modern awards and national minimum wage orders under sections 160 and 296.

(2) The FWC may correct or amend the error, defect or irregularity:

• (a) on its own initiative; or

• (b) on application."

[6] Section 602 of the Act provides that the Commission may correct or amend any obvious error, defect or irregularity in relation to a decision of the Commission. If the Commission makes a decision to make an instrument, it may also correct that instrument under s.602.

[7] Section 602 of the Act must be applied with caution.[2] The power to correct an obvious error is not confined to an error made by the Commission and may extend to obvious errors made by the parties and reflected in instruments approved by the Commission.[3] The correction should be such that, in the context of this application, had the matter been identified prior to the Agreement approval decision the correction would have been made at once.[4]

[8] The correction is sought by Freedom and the SDA on the basis that it will properly reflect the public holiday penalties intended to apply.

[9] Clause 15 of the Agreement sets out the additional loadings that apply for the performance of all ordinary hours worked after 6:00 pm Monday to Friday, and ordinary hours worked on Saturday, Sunday and public holidays. Except for public holidays, the penalty payments are expressed as an additional loading ranging from 10% to 75% of the ordinary hourly rate. This yields a payment of 110% to 175%.

[10] However, in the case of public holidays the additional loading for ordinary hours worked is expressed as 225% of the ordinary hourly rate for full-time and part-time employees and 250% of the ordinary hourly rate for casual employees (inclusive of the casual loading). This yields a payment of 325% and 350%, which Freedom and the SDA submit ought to be 225% and 250% respectively. This forms the basis for the application to correct clause 15.4 of the Agreement.

[11] Employees covered by the Agreement were apprised of this application and invited to provide any responsive views to the Commission. No such views were received.

[12] On the material before the Commission, I accept that the:

1. additional loading under the Agreement for public holidays worked is inconsistent with the equivalent entitlement under the Award, which prescribes an additional loading of 125% for all hours worked by a full-time or part-time employee, and 150% for all hours worked by a casual employee (inclusive of the casual loading); and

2. comparison document provided to relevant employees during the Agreement making process reflects the position that the entitlement would align with the Award.

[13] Having regard to the above matters, I am satisfied that the representation in the Agreement of 225% and 250% is intended to reflect the total amount to be paid for public holidays worked and not an additional loading on top of the ordinary hourly rate. Further, the correction sought is consistent with the manner in which clause 15 otherwise expresses the calculation of penalty payments for ordinary hours of work.

[14] Accordingly, I find that the public holiday loadings contained in clause 15.4 amount to an obvious error in the Agreement. The correct public holiday loading for full-time and part-time employees is 125% of the ordinary hourly rate and 150% of the ordinary hourly rate for casual employees (inclusive of the casual loading). Had the correction been sought by the parties prior to approval of the Agreement, it would have been accepted.

[15] Pursuant to s.602(2) of the Act, clause 15.4 of the Agreement is corrected to properly reflect the additional loadings identified at [14] for public holidays worked.

[16] The decision issued by the Commission on 4 May 2020, [2020] FWCA 2265 is therefore replaced with the version of the Agreement attached to this decision.

[1] Steinhoff Asia Pacific Pty Limited T/A Freedom [2020] FWCA 2265

[2] RotoMetrics Australia v AMWU [2011] FWAFB 7214 at [32]

[3] Schweppes Australia Pty Ltd v United Voice - Victoria Branch [2012] FWAFB 7858 at [348]

[4] Re Rigforce Pty Ltd [2019] FWC 3023 at [7]

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