[2015] FWCFB 620
FAIR WORK COMMISSION

DECISION


Fair Work Act 2009
s.156 - 4 yearly review of modern awards

SECURITY SERVICES INDUSTRY AWARD 2010
(AM2014/89)

Security services

VICE PRESIDENT WATSON
DEPUTY PRESIDENT KOVACIC
COMMISSIONER ROE

MELBOURNE, 2 MARCH 2015

Four yearly review of modern awards - Security Services Industry Award 2010 - Fair Work Act 2009, ss. 156, 138 and 134.

Introduction

[1] On 11 November 2014 the President issued a direction that this Full Bench hear and determine the substantive issues raised during the 2014 four yearly review of modern awards with respect of the Security Services Award 2010 (the Award). The award review is required to be conducted in accordance with s.156 of the Fair Work Act 2009 (the Act) which states:

[2] It is also necessary to consider provisions of the Act dealing with modern awards. Section 138 of the Act provides:

[3] With respect to this section, a Full Bench of the Commission has said: 1

[4] The modern awards objective in s.134 of the Act provides:

[5] In a preliminary decision concerning the 4 year review process a Full Bench said: 4

[6] The 4 year review represents the first full opportunity to consider the content of modern awards without the requirement in the award modernisation Ministerial request to avoid disadvantage to employees and increased costs for employers. A recent Full Bench summarised the approach at the time modern awards were made in the following terms: 8

[7] The following general observation in a preliminary Full Bench decision about the Review is relevant to the relationship between the decision to create a modern award, the historical context and the Review: 11

[8] While this may be the first opportunity to seek significant changes to the terms of modern awards, a substantive case for change is nevertheless required. The more significant the change, in terms of impact or a lengthy history of particular award provisions, the more detailed the case must be. Variations to awards have rarely been made merely on the basis of bare requests or strongly contested submissions. In order to found a case for an award variation it is usually necessary to advance detailed evidence of the operation of the award, the impact of the current provisions on employers and employees covered by it and the likely impact of the proposed changes. Such evidence should be combined with sound and balanced reasoning supporting a change. Ultimately the Commission must assess the evidence and submissions against the statutory tests set out above, principally whether the award provides a fair and relevant minimum safety net of terms and conditions and whether the proposed variations are necessary to achieve the modern awards objective. These tests encompass many traditional merit considerations regarding proposed award variations.

[9] The issues that we have been directed to determine are set out in Schedule B to the President’s directions together with further matters subsequently added to the direction on 18 November 2014. The issues concern the coverage of the award, security licences, shift duration, broken shifts, long breaks, stand-by allowance, meal allowance, permanent night work, overtime rates for casuals, change of contract, consultation, a definition of “first response”, amended classification description of Security Officer Level 3, insertion of new military allowance and increased hourly rate of Security Officer Legal 1. The changes are sought by a variety of employers, organisations and an employee with an interest in the operation of the Award. We propose to consider each of these matters in turn.

Coverage of the Award

[10] MSS Security seeks to convert the Award from an industry award to a vocational award by way of an extension to the scope of the Award in clause 4 to cover employers who engage security guards as an incidental part of their main business. Security classifications are contained in approximately 20 other industry awards. Examples include the Registered and Licensed Clubs Award 2010 and the Educational Services (Post-Secondary Education) Award 2010. MSS Security contends that for the equity of security contractors and their employees, the wage rates for employees of the various types of employers should be identical. Its application seeks to transfer coverage from the other awards with security classifications and provide additional coverage of any security employees employed in other industries. The change is supported in respect to current award free security employees by United Voice and opposed in its entirety by various employer groups including Australian Industry Group, Australian Business Industrial and New South Wales Business Chamber Ltd.

[11] As we have noted above, the award modernisation process conducted under s.576C of the Workplace Relations Act 1996 was required to be conducted in accordance with a ministerial request. The request included the following provisions:

[12] When issuing the exposure draft of the Award the Full Bench said: 12

[13] In a subsequent decision the Full Bench said: 13

[14] In December 2009 the Full Bench said: 14

[15] Neither MSS Security nor United Voice called evidence of security officers being employed by employers in an industry that does not contain a security officer classification or where rates attaching to security classifications in other modern awards are being utilised in a way that is diminishing the use of security contractors. Rather, the arguments advanced in favour of the variation are more conceptual and allege a commercial disadvantage contractors have in competing with direct employees of their clients.

[16] The considerations that led to the conclusions of the Award Modernisation Full Bench remain relevant because they concern aspects of the modern awards objective, especially the objective of a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards. Requiring employers in a separate industry to comply with an additional award, for what will usually be a small proportion of its employees, conflicts with this objective.

[17] If there is a problem with different wage rates in awards, the wage rates themselves can be reviewed where there are work value reasons to vary the award rates and it is necessary to achieve the modern awards objective. Rates in different awards for classifications of the same work value are expected to be uniform as a result of the minimum rates adjustment process conducted in the late 1980s and early 1990s. Where it can be demonstrated that this is not the case, there may be a question whether the modern awards objective is being achieved.

[18] It has not been established that the proposed variation to the coverage clause is necessary to achieve the modern awards objective.

Security Licences

[19] ASIAL seeks to insert a proposed new sub-clause to clause 10.6 to clarify the rights and responsibilities of employees and employers where an employee is required, by law or regulation, to hold a current security licence in order to perform the job, and that licence has expired, been revoked, suspended, refused or not been renewed. ASIAL contends that one reading of the relevant clauses in the Award as they currently stand, is that an employer may have no alternative but to terminate the employee where any of the circumstances specified in the sub-clause exist. The proposed variation would permit the employer to stand the employee down without pay for a period of two weeks in order that the licensing issue may be resolved. A longer period of stand down is proposed to be permitted by agreement. The Australian Industry Group does not oppose the change. The change is supported by MSS Security, United Voice, Australian Business Industrial and New South Wales Business Chamber Ltd subject to minor amendments being made to the wording of the proposed clause.

[20] To the extent that the existing clause may create confusion, we agree that it is desirable, and consistent with the modern awards objective, that the issue raised by ASIAL be clarified. We are of the view that a new sub-clause (d) should be inserted in the following terms:

Shift Duration

[21] Both ASIAL and MSS Security seek to replace the current “shift duration” clause 21.2 so that the maximum ordinary hours in a shift would be increased from 10 (with an ability for an employer and a majority of employees to agree to 12 hour shifts) to 12 ordinary hour shifts to be worked at the direction of the employer. They contend that 12 hour ordinary shifts have long been custom in the industry given the demands of clients and that the current clause is unnecessarily restrictive. The wording of the proposed clauses varies slightly. MSS Security’s proposed clause provides for representation and negotiation with respect to the implementation of 12 hour ordinary roster patterns and requires that any agreement reached must be reduced to writing. The change is neither supported nor opposed by various employer groups including Australian Industry Group and Australian Business Industrial and New South Wales Business Chamber Ltd. The change is opposed by United Voice on the grounds that it creates confusion and dissolves an existing facilitative provision.

[22] No evidentiary case has been advanced to support the proposed variations. Shift lengths of 12 hours duration are now common in industry. The Award currently provides for the introduction of 12 hour shifts provided a fair process is followed prior to their introduction that allows for a consideration of all relevant implications. In the absence of an evidentiary case demonstrating actual problems with the operation of the current clause, we are not persuaded that the change is necessary to achieve the modern awards objective. This proposed variation should not be made.

Broken Shifts

[23] ASIAL seeks to amend the current “broken shifts” clause 21.7 to make reference to a combined maximum of 10 hours (or 12 hours in relevant workplaces) permitted to be rostered in the two work periods of a broken shift. It also seeks to provide that the minimum break between the two work periods is 60 minutes. The change is neither supported nor opposed by various employer groups including Australian Industry Group, Australian Business Industrial and New South Wales Business Chamber Ltd. Both MSS Security and United Voice propose alternative variations to the clause if there is found to be a need for clarity regarding the working of broken shifts.

[24] ASIAL has not advanced an evidentiary case demonstrating problems with the operation of the existing provision. We are not satisfied that the change is necessary to achieve the modern awards objective. The proposed variation should not be made.

Long Breaks

[25] United Voice seeks to amend the current “long breaks” clause 21.4 to clarify the break requirements for employees working a two week roster cycle as the clause in its current form only specifically provides for long breaks during roster cycles of three, four or eight weeks. It submits that two breaks of two days each should be expressly provided in line with an interpretation of the clause by the Federal Court. 15

[26] The change is opposed by various employer groups including Australian Industry Group, Australian Business Industrial and New South Wales Business Chamber Ltd. The change is not opposed by MSS Security. The employers generally contend that the interpretation adopted by the Federal Court is incorrect, that the decision provides no basis for the variation, and that no case has been made out to vary the clause. Australian Business Industrial contends that if the Commission is of the view that the clause is ambiguous, a variation should be made to clarify that it only applies to the roster cycles mentioned in the clause.

[27] We agree that the interpretation by the Federal Court does not, in itself, provide justification for a variation. Further we are not of the view that the intention of the provision, in view of its history, was to imply an obligation for a certain number of long breaks for shift cycles not dealt with in the clause. In our view, the decision of the Federal Court has given rise to an ambiguity and that it is desirable for this to be remedied. Therefore a variation should be made, consistent with the history and intent of the clause, and in the absence of an evidentiary case justifying a variation, in line with the amendment sought by Australian Business Industrial. The preamble to sub clause 21.4(b) should be amended to read:

Stand-by Allowance

[28] ASIAL seeks to insert a proposed new “stand-by allowance” in clause 15 to compensate employees with an allowance of 1.76% of the weekly standard rate per day where they are required to hold themselves in readiness to be available to work at short notice. The change effectively entitles an employer to place an employee on stand-by and be paid the relevant amount of approximately $13.25 per day, and payment at the relevant hourly rate for any time worked.

[29] The Australian Industry Group and MSS Security do not oppose the change. The change is opposed by United Voice. The change is neither supported nor opposed by Australian Business Industrial and New South Wales Business Chamber Ltd.

[30] In our view, the variation seeks to do far more than provide for an additional payment that does not exist in the Award. It seeks to introduce a notion of stand-by and provide award legitimacy for a practice not currently provided for in the Award. It may be that in certain industries, a requirement to stand-by to be called in for unforeseen work requirements is reasonable, and that such a requirement should not attract an entitlement to full wages where no work is actually performed. However, the change is sought without evidence being led of the nature of the need, the type of demands that could be placed on employees, a consideration of safeguards about its operation, and a review of award provisions in other industries which may inform a fair approach to such a matter. In the absence of such a case being presented we have not been persuaded that the variation is necessary to achieve the modern awards objective and conclude that the variation should not be made.

Meal Allowance

[31] MSS Security seeks to amend the current “meal allowance” clause 15.3 regarding the trigger point for payment of a meal allowance when overtime is worked. Currently a meal allowance is payable when an employee is required to work more than an hour beyond the completion of their ordinary shift. The variation seeks to amend the trigger point to the nearest 15 minutes, so that overtime of 1 hour and 7 minutes would be rounded down to 1 hour and no meal allowance would be payable.

[32] The Australian Industry Group does not oppose the change. The change is opposed by United Voice. The change is neither supported nor opposed by Australian Business Industrial and New South Wales Business Chamber Ltd.

[33] In our view, the change is not supported by logic or fairness. Indeed it would be likely to add to confusion regarding the operation of the clause and may have the undesired effect of causing disputation. It is not necessary to achieve the modern awards objective. The variation should not be made.

Permanent Night Work

[34] MSS Security seeks to replace the current clause 22.2 regarding the definition of “permanent night work”, which is subject to a 30% penalty payment under clause 22.3. The clause currently reads:

[35] The new wording sought by MSS Security is as follows:

[36] In its reply submissions MSS Security proposed an alternative clause as follows:

[37] The variation is opposed by United Voice. The change is neither supported nor opposed by Australian Business Industrial and New South Wales Business Chamber Ltd. The Australian Industry Group does not oppose the change.

[38] The effect of the clause is to add an additional condition for qualification of the higher shift penalty attaching to permanent night work. The condition relates to the extent to which shifts, on average, fall into the midnight to 6am span of hours. Work of less than two hours into the span; that is finishing before 2am or commencing after 4am would not be regarded as a night shift for the purposes of the calculation of the first qualifying condition of the clause.

[39] The context of the application is the early starts of many security officers. MSS Security contends that a 5am to 5pm 12 hour shift or a 5pm to 1am shift should not qualify as a night shift for the purposes of the higher permanent night shift allowance. MSS Security submits that the current wording is preventing rostering arrangements that might attract the higher penalty, even though they may be preferred by employees and better suit the needs of clients.

[40] In our view, a matter such as this should be considered in the light of other award provisions regarding permanent night shift penalties with appropriate adaptations for the nature of the industry. If an evidentiary case established that the current provisions were inappropriate and that the matter cannot be conveniently addressed by way of enterprise agreements or the award flexibility provision, then a case may exist for an appropriate award variation. However, the case presented fell well short of the detailed review of circumstances that might warrant a variation. In our view, the variation should not be made.

Overtime rates for casuals

[41] ASIAL seeks to add a sub-clause to the “overtime rates” clause 23.3 to avoid confusion in calculating rates for casuals and the payment of casual loading. The clause currently reads:

[42] The new wording sought by ASIAL is as follows:

23.3(b) Where an employee works overtime the employer must pay to the employee the ordinary time rate for the period of overtime together with a loading as follows:

[43] MSS Security, Australian Business Industrial and New South Wales Business Chamber Ltd do not oppose the change. However, United Voice submits that the change is unnecessary as the proposed summary of hourly rates table to be inserted into a schedule to the Award would achieve the same purpose. We agree with the submission of United Voice and do not consider that the new sub-clause is necessary in the light of the proposed schedule and it is not necessary to achieve the modern awards objective.

Change of Contract

[44] MSS Security seeks to amend the current “change of contract” clause 12.5 so that s.119 of the Act does not apply where the employee of the outgoing contractor is offered other acceptable employment with the incoming contractor instead of the current provision that requires an employee to agree to other acceptable employment with the incoming contractor before the redundancy pay obligation in the Act is removed. The clause currently reads:

[45] The new wording sought by MSS Security is as follows:

(b) Section 119 of the Act does not apply to an employee of the outgoing contractor

where:

[46] MSS Security submits that the change is necessary to resolve a contradiction arising from the interaction of s.119 and clause 12.5 and that the clause retains the concept of acceptable alternative employment to ensure that an employee is not disadvantaged in other employment overall. It is intended to prevent an employee withholding agreement to an offer of acceptable alternative employment in order to claim redundancy pay. The Australian Industry Group does not oppose the change.

[47] United Voice opposes the variation. It submits that in an industry with repeated changes in contracts and invariable non-recognition of past service, the change would have the effect of denying a redundancy entitlement to an employee who rejects an offer because of the non-availability of leave based on prior service (other than annual leave).

[48] As noted by the parties, clause 12.5 operates in conjunction with the provisions of the Act regarding the payment of redundancy pay. A variety of circumstances are dealt with in the Act including an ability to make an application to this Commission under s.120 to have the redundancy pay obligation reduced if the employer obtains acceptable alternative employment for the employee.

[49] The effect of the change sought by MSS Security would enable an employer of an employee who is offered employment with a future contractor to decline a redundancy payment based on the employer’s view of whether the alternative employment was acceptable. The employer would have no need to make out a case under s.120 of the Act and have the circumstances considered by a tribunal. The only way an employee could contest the view of the employer would be to take enforcement proceedings under the Act.

[50] We see no reason to depart from the provisions of the Act regarding these matters. Clause 12.5 operates because the security services industry is effectively a contract industry. We consider that its operation should not be expanded when other avenues under the Act are available to an employer in line with the avenues that apply to employers in other industries. The change is not necessary to achieve the modern awards objective. We do not believe the variation should be made.

Consultation

[51] ASIAL seeks to replace the current “consultation” clause 8.2 regarding changes to rosters or hours of work to limit the operation of the clause to circumstances where the changes to rosters or hours of work have significant impact on the employees of the business. The clause currently reads:

[52] The new wording sought by ASIAL is as follows:

[53] A revised proposal to much the same effect was proposed after the hearing of the matter. ASIAL submits that the existing clause is onerous for the small businesses in the industry because it limits the employers’ ability to respond to demands of clients. It submits that since the Award was made in 2010 there have not been any matters brought before the Commission relating to changes of rosters under the Award. The Australian Business Industrial and the New South Wales Business Chamber Ltd do not oppose the change. United Voice supports the change and submits that the changes are sensible and consistent with the legislative requirement.

[54] The background to this clause is important. It was inserted into this Award, and all other awards, by a Full Bench in 2013 consequent upon the enactment of s.145A of the Act and the obligation on the Commission pursuant to a transitional provision in the amending Act requiring the Commission to make a determination varying certain modern awards by 31 December 2013, to include a term of the kind mentioned in s.145A. That section provides:

[55] In the course of its decision the Full Bench said:  16

[56] The same considerations apply to the proposed change to clause 8.2(a). The legislation requires the Commission to insert consultation obligations of a particular type in particular circumstances. Modifying those circumstances would result in the Award not complying with the legislative requirement. We do not approve this change.

[57] We see no difficulty in the current operation of sub-clause (d) which is proposed to be deleted. We do not approve the deletion of this sub-clause.

[58] On one view, the proposed changes to sub-clauses (c) and (d) do not significantly alter the obligations under the clause or affect the conformity of the clause with s.145A. However, the clause in question is a standard award clause. Its subject matter is consultation. The obligations to consult are contained in sub-clauses (a) and (b). The proposed sub-clause (c) goes beyond the obligation to consult and deals with an evaluation of the proposed changes. The purpose of doing so is not clear and could create confusion in those seeking to apply the clause. We do not therefore consider that a sufficient case has been made out to approve the proposed variation.

First Response

[59] ASIAL seeks to insert a definition of “first response” into the definitions clause of the Award. The term is used in the classification definitions in Schedule C to the Award. The definition sought by ASIAL is as follows:

[60] Australian Industry Group, United Voice, Australian Business Industrial and New South Wales Business Chamber Ltd do not oppose the change. United Voice agrees that the definition, as drafted, is appropriate and assists in the operation of the definitions schedule. In our view, the clarification provided by the variation is consistent with a fair and relevant safety net and is necessary to achieve the modern awards objective. We approve this variation.

Classification Description

[61] Mr Christian Gavin, security officer, seeks to amend the current Schedule C - Classification C.3 Security Officer Level 3 by inserting the following task as being indicative of the tasks that an employee at Level 3 may be required to perform:

[62] Mr Gavin submits that the proposed variation is necessary for the clarification of duties performed by security officers at military bases or defence establishments and that the parties to the award consultation process have overlooked the need to include officers working at such premises.

[63] The coverage of the Award in clause 4 is expressed in broad terms. It defines the employers bound by the award. The classification definitions in Schedule C to the Award identify the employees of those employers who are covered. These are also expressed in broad generic terms. In our view, it is unnecessary to specify types of establishment that may fall within the general descriptions. It has not been established that this variation is necessary to achieve the modern awards objective.

Military Allowance

[64] Mr Gavin seeks to amend the current “allowance rates” clause 15 so that a military allowance of 0.187% of standard rate per hour is payable to an employee who is performing security work at a military base or defence establishment. Mr Gavin submits that the proposed variation is necessary for the acknowledgment of the activities performed by officers at such premises and that it would provide for an allowance similar to the aviation allowance received by officers at aviation premises.

[65] A sufficient evidentiary or reasoned case has not been advanced to support a finding that this variation is necessary to achieve the modern awards objective.

Hourly Rate

[66] Mr Gavin seeks to amend the current Schedule C - Classification C.1 Security Officer Level 1 to increase the hourly rate to $20.53 per hour. This submission is made in response to MSS Security and ASIAL submissions that the maximum ordinary hours in a shift be increased from 10 to 12 hours. Mr Gavin submits that while 12 hour shifts may be customary, many security officers working a 12 hour shift will receive 2 hours overtime pay and that to extend ordinary hours of work from 10 hours to 12 hours will financially penalise workers.

[67] We have not agreed to make the variation that gives rise to this application. A sufficient case has not been advanced to support this variation.

Conclusions

[68] The variations approved in this decision will be made by the Award Review Full Bench when finalising the revised Award in relation to non-contentious issues.

VICE PRESIDENT WATSON

Appearances:

Mr K. Scott for Australian Business Industrial, New South Wales Business Chamber Ltd and Business S.A.

Ms N. Street for Australian Industry Group.

Ms J. Light for Australian Federation of Employees and Industry.

Hearing details:

2014.

Melbourne - Video Conference Link to Sydney.

9 December.

 1   [2014] FWCFB 1788.

 2   (2012) 205 FCR 227.

 3   Ibid at [35]-[37] and [46].

 4   [2014] FWCFB 1788.

 5   Shop, Distributive and Allied Employees Association v National Retail Association (No 2) (2012) 205 FCR 227 at [35] per Tracey J.

 6   Friends of Hichinbrook Society Inc v Minister for Environment (No 3) (1997) 77 FCR 153; Australian Competition and Consumer Commission v Leelee Pty Ltd [1999] FCA 1121; Edwards v Giudice [1999] FCA 1836.

 7   (1987) 16 FCR 167 at 184; cited with approval by Hely J in Elias v Commissioner of Taxation (2002) 123 FCR 499 at [62] and by Katzmann J in CFMEU v FWA (2011) 195 FCR 74 at [103].

 8   [2015] FWCFB 616.

 9   http://www.airc.gov.au/awardmod/download/award_modernisation_request.pdf

 10   [2010] FWAFB 305 at [3].

 11   [2014] FWCFB 1788.

 12   [2008] AIRCFB 717 at [94].

 13   [2008] AIRCFB 1000 at [289-290].

 14   [2009] AIRCFB 963.

 15   Sydney Night Patrol and Inquiry Company Limited t/as SNP Security v Pulleine [2014] FCA 385.

 16   [2013] FWCFB 10165.

Printed by authority of the Commonwealth Government Printer

<Price code C, MA000016 PR560408 >