[2010] FWAFB 965

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FAIR WORK AUSTRALIA

DECISION

Workplace Relations Act 1996
s.576H—Commission may vary modern awards

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch 5, Item 14—Variation of modern award

Australian Municipal, Administrative, Clerical and Services Union
(AM2009/151)

AIRLINE OPERATIONS – GROUND STAFF AWARD 2010
[MA0000048]

JUSTICE GIUDICE, PRESIDENT
VICE PRESIDENT LAWLER
VICE PRESIDENT WATSON
SENIOR DEPUTY PRESIDENT WATSON
SENIOR DEPUTY PRESIDENT HARRISON
SENIOR DEPUTY PRESIDENT ACTON
COMMISSIONER SMITH

MELBOURNE, 26 FEBRUARY 2010

[1] This decision concerns an application by the Australian Municipal, Administrative, Clerical and Services Union (ASU) to vary the Airline Operations – Ground Staff Award 2010 1 (the modern award) in relation to classifications, wage rates and allowances.

[2] The application was made pursuant to s.576H of the Workplace Relations Act 1996 and was not determined by 31 December 2009. The application will be determined by Fair Work Australia pursuant to item 14 of Schedule 5 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009. 2

[3] The application is made in light of variations made on 9 November 2009 to the Minister for Employment and Workplace Relations’ award modernisation request. The variation added the following paragraph to the request:

[4] In her letter accompanying the amended request the Minister said:

[5] The ASU submits that the airline industry has traditionally been considered to have three discrete sectors – international, domestic and regional aviation. It states that industrial award coverage has reflected these elements. The ASU submits that in general terms three types of award applied to clerical employees prior to 1 January 2010. An overseas airlines award applied to foreign based international operators (but not Australian based international operators), a domestic airlines award applied to domestic operators and common rule clerical awards and NAPSAs applied to regional airlines. The ASU seeks that the current single eight level wage structure be replaced with a seven level structure for regional aviation, a nine level operations structure for domestic aviation, an eight level support structure for domestic aviation and a six level structure for overseas based international aviation operators. The domestic structure is intended to apply to Australian based international operators. The rates sought for these structures are as follows:

[6] The wage scale sought for regional aviation is the wage scale in the modern award but without level 8. The wage scales sought for domestic aviation are based on the wage scales in the Airline Operations—Clerical and Administrative Award 1999 3 (domestic airlines award), updated to take account of increases in minimum wages since 2005. The wage scale sought for international aviation is based on the rates in the Overseas Airlines (Interim) Award 19994 (overseas airlines award), updated to take account of minimum wage increases since 2006.

[7] The employers do not dispute the commercial division of the industry into the three sectors. However, they contend that the overseas airlines award did not apply to all foreign based international operators. They submit that carriers such as Etihad Airways, Virgin Atlantic, Qantas Airways, Vietnam Airlines and China Air are not covered by the award and would face a substantial increase in costs. The employers also submit that all but one respondent to the overseas airlines award outsource above wing ground staff to third party providers who are not bound by the overseas airlines award. The employers submit that the domestic airlines award should properly be seen as a company specific classification structure developed with respect to the operations of Ansett Airlines.

[8] The employers advance various reasons why the overseas airlines award and the domestic airlines award provide an inappropriate basis for rates in the modern award. They submit that the overseas airlines award does not contain properly fixed minimum rates. Further, they submit that the classification structure in the domestic airlines award is not an appropriate structure for domestic aviation. They submit that the award does not cover employees of Qantas Airways because that company is covered by an enterprise award. Other domestic and Australian based international operators are not covered by the award either and the application should be seen as an attempt to extend rates developed for Ansett to operators which currently have no such obligation. Employers contend that the large number of workplace agreements providing rates in excess of the overseas airlines award undermines the notion that there is some employee disadvantage created by the adoption of rates in the modern award which are lower than those in the overseas airlines award.

[9] The employers provided information regarding the work of clerical employees in the industry. They submit that the information establishes the following points:

[10] The employers submit that the material before us establishes that clerical work is in the same situation as ground handling work in that there is no basis for distinguishing the nature of the work depending on whether the work is performed in relation to regional, domestic or overseas aviation. They submit that to create different structures would be to impose an artificial distinction and a distortion of relativities between clerical employees and with regard to other employees covered by the award.

[11] We have considered all of the material relied on by the parties and considered whether the single classification structure should be replaced by four separate structures as proposed by the ASU. In our view there is not a sound basis for splitting the classification structure into four separate structures. On the material before us it appears that the work of clerical employees in the airline industry is essentially the same regardless of the part of the industry in which the work is performed. We have adopted a single classification structure for the entirety of clerical work in the private sector not covered by an industry award. The classification structure in the award is specific to the airline industry. It is an enhancement on the five level structure applying to private sector clerical employment generally.

[12] It is necessary to deal with the ASU’s submission that the overseas airlines award contains wage rates which are properly fixed minimum rates as a result of the award simplification process. In its main decision simplifying the award the Commission noted that the rates of pay were paid rates (not minimum rates). 5 The decision noted that a conference would be convened to review the rates. Conferences subsequently occurred before Commissioner Raffaelli who issued an order, presumably by consent, on 24 August 2005.6 The ASU submits that the rates in that order were properly fixed minimum rates. AiGroup disputes this claim. It pointed to the principles adopted by the Commission for the conversion of paid rates to minimum rates and drew a comparison between the rates in the award before and after Commissioner Raffaelli’s Order.. This material indicates that the key classification rate in the new structure which was nominally aligned with the C10 rate in the metal industry was in fact more than $85.00 above that rate. On the basis of this material it is clear that the rates in the overseas airlines award are not properly fixed minimum rates.

[13] It has long been established that rates of pay in minimum rates awards should be properly fixed minimum rates with any differences between them to be based on differences in work value. This is a requirement for classifications within awards as well as comparisons of classifications and rates of pay between awards. We are not persuaded that a proper case has been made out on work value grounds to provide four different classification structures containing different rates for essentially the same work. In essence the different rates would be inequitable. The result would require an increase in the minimum obligation for some employers. On the other hand it has not been established that the retention of a properly fixed minimum single classification structure will lead to any reduction in current actual entitlements for any employee. The four structures proposed by the ASU are not based on existing obligations for all employers sought to be covered. Further, the level of complexity involved in granting the application is not consistent with the modern awards objectives or the outcome achieved in modern awards generally.

[14] In accordance with the Minister’s amended request we have considered whether separate classification structures and rates of pay should be provided for ground staff involved in different airline sectors. For the above reasons the proposed differentiation between regional, domestic and Australian based international carriers and overseas based operators is not easy to discern when the nature of the work of current employers and their employees is considered. Therefore, on the material before us, we are unable to conclude that separate classification structures and rates of pay should be provided for ground staff employed in regional, domestic and overseas airline operations.

[15] We think it is important to emphasize that the ASU did not attempt to show that the different structures it sought were justified by differences in the nature of the work and/or the circumstances under which it is performed by the employees in question. In short, the ASU did not seek to establish a proposal based on work value grounds. An opportunity to do so will arise during the 2012 award review.

[16] The ASU also seeks to introduce a Transport allowance, a Zone Allowance and a Social Disability allowance for clerical and administrative employees other than those engaged in regional aviation. The ASU relies on entitlements to the allowances in various enterprise awards and industry awards applying to categories of employees other than clerical employees. The allowances are not sought for other categories of employees or supported by other unions.

[17] The claims are opposed by employers. They contend that the matters were considered fully in the proceedings leading to the making of the award and nothing has been advanced to alter the conclusions in relation to these allowances. The employers contend that the modern award should be seen as a package of entitlements and that a number of allowances in the award impose new obligations on certain categories of employers. The allowances in question are not applied to many employees at present and would impose new obligations. Further, the nature of some of the allowances does not sit comfortably with the notion that they not apply to regional aviation or to other categories of employees.

[18] We do not consider that a case has been made out to revise our decision in relation to these allowances. By not including particular allowances in the safety net we are not finally deciding that the particular claim is without merit. The modern award has been developed as a single instrument covering all aspects of the airline industry. The provisions substantially rationalise and reduce the level of prescription in pre-existing awards and are intended to contain the key items of the safety net operating in conjunction with the National Employment Standards. Matters which are not part of the award safety net can be addressed on an enterprise basis in bargaining where the actual circumstances of the enterprise and the precise justification for the allowance can be more readily considered.

PRESIDENT

Appearances:

M. Purvis for the Flight Attendants Association of Australia—International Division.

T. Clarke for the Australian Services Union.

J.Playford and F. Rodriguez on behalf of Flight Attendants Association of Australia—Domestic Regional Division.

R. Bernasconi and K. Srdanovic on behalf of Qantas Group.

D.Trindade for the Regional Aviation Association of Australia.

M. Mead and B. Perry on behalf of Australian Industry Group and Board of Airline Representatives of Australia.

Hearing details:

2009.
Melbourne:
December, 16

 1   MA000048.

 2   Schedule 5 was modified by the Fair Work Legislation Amendment Regulations 2009 (No.2) on 14 December 2009.

 3   AP768636.

 4   AP791898.

 5   15 January 1999 Print R0807.

 6   PR961750.




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