[2016] FWCFB 597

The attached document replaces the document previously issued with the above code on 19 February.

A date change has been inserted at paragraph 12.

Associate to Vice President Hatcher

Dated 5 September 2016.

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

Concrete Products Award 2010 - AWU claim.

Introduction

[1] The Australian Workers’ Union (AWU) has raised an issue concerning an anomaly or ambiguity in the Concrete Products Award 2010 1 (Award) in relation to penalty rates for shiftworkers performing non-continuous shift work on Sundays and public holidays. Clause 25.9 of the Award as it currently stands relevantly provides:

25.9 Sundays and public holidays

(a) Shiftworkers on continuous shifts for work on a rostered shift the major portion of which is performed on a Sunday or public holiday will be paid as follows:

(i) Sundays—at the rate of double time; or

(ii) public holidays as prescribed by clause 29 - Public holidays, at the rate of double time.


(b) Shiftworkers on other than continuous work for all time worked on a Sunday or public holiday will be paid at the rates prescribed by clause 15 - Minimum wages Where shifts commence between 11.00 pm and midnight on a Sunday or a public holiday, the time worked before midnight will not entitle the employee to the Sunday or public holiday rate, provided that the time worked by an employee on a shift commencing before midnight on the day preceding a Sunday or public holiday and extending into a Sunday or public holiday will be regarded as time worked on such Sunday or public holiday.

(c) Where shifts fall partly on a public holiday, that shift the major portion of which falls on a public holiday will be regarded as the public holiday shift.

[2] The cross-reference in clause 25.9(b) to the minimum rates in clause 15 suggested, the AWU submitted, that non-continuous shiftworkers were to be paid at ordinary time rates on Sundays and public holidays. This was anomalous, it submitted, when compared to the following provisions of the Award:

• Clause 24.3 provides generally that work done on Sundays would be paid at double time with a minimum payment of four hours’ work.



• Clause 29.3 provides generally that if an employee works on any of the public holidays provided for in the NES or any day substituted for such public holidays the rate of payment is double time and a half.



• Clause 25.7 provides that shiftworkers generally (without any exclusion for non-continuous shiftworkers) are to be paid at time and a half for Saturday shifts. This means, on the face of it, non-continuous shiftworkers receive under the Award a higher rate of pay on Saturdays than they do for Sundays or public holidays.

[3] The AWU also identified internal tension within clause 25.9(b), in that the second sentence of the provision contemplated that non-continuous shiftworkers would receive “the Sunday or public holiday rate” except for that part of a shift which commenced between 11.00pm and midnight on a Sunday or a public holiday. This requirement would be unnecessary if it was intended that the rate for Sundays and public holidays be ordinary time. This demonstrated, the AWU submitted, that the cross-reference to clause 15 was a previously undetected drafting error which had crept into the Award.

[4] The further amended exposure draft of the reviewed Award which was published by the Commission on 2 February 2015 sought to remove any ambiguity by providing as follows in clause 13.9(b)(i): “Shiftworkers on other than continuous work will be paid at the ordinary rates of pay prescribed by clause 10.1 - Minimum wages for all time worked on a Sunday or public holiday.” The AWU submitted that the proposed new provision, although it would clearly remove any doubt about what rate was intended to apply for non-continuous shiftworkers working on Sundays and public holidays, would entrench the existing anomaly. The AWU proposed that it should be amended to read: “Shiftworkers on other than continuous work will be paid at the rate of 200% for all work performed on a Sunday and the rate of 250% for all work performed on a public holiday”.

[5] The AWU’s position was supported by the Construction, Forestry, Mining and Energy Union. 2

[6] The AWU’s position was opposed by the Australian Industry Group, Australian Business Industrial and the NSW Business Chamber (the employer groups). They submitted:

• The AWU had failed to demonstrate that the existing and proposed provisions would be contrary to the modern awards objective in s.134 of the Fair Work Act 2009 (FW Act).



• The Commission should proceed on the basis that, prima facie, a modern award achieved the modern awards objective when it was made.



• Cogent reasons would be required to depart from a previous Full Bench decision establishing a modern award.



• The relevant provision had appeared in the Concrete Products Award since its creation without amendment. The current provision is, in substance, in the same terms as the equivalent provision of the Cement and Concrete Products Award 2000.



• Draft awards filed by the AWU and the Boral Group in 2009 during the award modernisation process contained the same provision, and this was reflected in the Australian Industrial Relation Commission’s (AIRC) own exposure draft. The Award as made reflected the consensus on the issue.



• The provision itself was not ambiguous. If there is any error, it is that the second sentence in clause 25.9(b) was intended to apply to continuous shiftworkers, and should have been contained in a separate paragraph.



• It was not necessary to replace the existing provision with the AWU’s proposed provision in order to meet the modern awards objective.

Consideration

[7] We consider that it is apparent, having regard to the terms of clause 25.9(b) taken in the context of the Award as a whole and its history, that the cross-reference to clause 15, Minimum wages, is an error. The most obvious contextual pointer to this is that there is no logical reason why non-continuous shiftworkers should receive no penalty rates for working on Sundays and public holidays when all other employees under the Award do and when such shiftworkers receive a penalty rate for working on Saturdays. No party was able to suggest any reasonable rationale for this.

[8] We also accept the AWU’s submission that both the words and the apparent purpose of the second sentence of clause 25.9(b) strongly indicate that it was intended that non-continuous shiftworkers should receive a penalty rate of some description for working on Sundays and public holidays. The employers’ contention that this sentence was probably intended to also apply to continuous shiftworkers is a reasonable one, having regard to the original form of the clause (which we discuss later), but that does not alter the fact that its apparent application to non-continuous shiftworkers makes no sense if non-continuous shiftworkers were not to receive any penalty rates for working on Sundays or public holidays.

[9] A comprehensive shift work clause (clause 9) was added to the then Cement and Concrete Products Award 1987 (1987 Award) as a result of an order of the AIRC (Grimshaw C) issued on 21 August 1990. 3 Clause 9(j) provided:

Sundays and holidays

 

(j) Shift workers on continuous shifts for work on a rostered shift the major portion of which is performed on a Sunday or holiday shall be paid as follows:

 
(i) Sundays - at the rate of double time.
 
(ii) Holidays as prescribed by clause 14 - at the rate of double time.
 

Shift workers on other than continuous work for all time worked on a Sunday or holiday shall be paid at the rates prescribed by clause 22 of this award. Where shifts commence between 11.00 p.m. and midnight on a Sunday or a holiday, the time so worked before midnight shall not entitle the employee to the Sunday or holiday rate; provided that the time worked by an employee on a shift commencing before midnight on the day preceding a Sunday or holiday and extending into a Sunday or holiday shall be regarded a time worked on such Sunday or holiday.

Where shifts fall partly on a holiday, that shift the major portion of which falls on a holiday, shall be regarded as the holiday shift.

[10] It can be seen that the clause is substantially in the same form as the current clause 25.9, but the Sunday and public holiday rates for non-continuous shiftworkers is identified as being contained in clause 22. Clause 22 of the 1987 Award was concerned with right of entry of union officials, and needless to say contained nothing of relevance to rates of pay for non-continuous shiftworkers. The cross-reference was therefore in error from the outset.

[11] The transcript of the hearing before the Commissioner on 20 July 1990 which led to the making of the variation showed that it was a part of a package of changes intended to satisfy the requirements for the award of the second stage wage increases available under the Structural Efficiency Principle. The changes were advanced by consent save for one matter. The AWU, which was the applicant, said “The one area of disagreement is in regard to the payment of shiftworkers who work on a public holiday” and expressed a preference for what was described as the Queensland standard, which was double time and a half, over the Federal standard, which was double time. The Australian Chamber of Manufactures described the disagreement somewhat differently, saying that it concerned “the rates of pay to apply to shift workers on continual shifts rostered to work on a public holiday” (underlining added), and pressed for the standard to be double time. The Commissioner simply ruled that “in respect to the question of the rate to apply for Sundays and public holidays, I am not prepared to disturb the national standards that apply, accordingly double time will be the rate”.

[12] The 1987 Award as it stood immediately before the 1990 variations only contained (in clause 9) limited provisions dealing with non-continuous shift work. Clause 9 made no specific reference to the performance of work on Sundays or public holidays (or on Saturdays) or the rates to apply thereto, but clause 14(a) provided that all work done on Sundays would be paid at double time and all work done on public holidays would be paid at double time and a half.

[13] It can safely be assumed that the AWU did not in 1990 consent to the removal of Sunday and public holiday penalty rates for non-continuous shiftworkers. Therefore, having regard to the ambiguity of the question in issue at the 20 July 1990 hearing, it can be reasonably be inferred that it was intended by the AIRC that non-continuous shiftworkers be paid at double time on Sundays and either double time or double time and a half on public holidays. However that intention was not reflected in the text of the provision, which contained the erroneous cross-reference we have earlier identified.

[14] The Cement and Concrete Products Award 2000 (2000 Award) arose out of a decision issued by the AIRC (Merriman C) on 11 April 2000 in relation to the review of the 1987 Award conducted pursuant to Item 51 of Part 2 of Schedule 5 of the Workplace Relations and Other Legislation Amendment Act 1996. 4 It was not a new award as such, but a variation to the 1987 Award which replaced all of its provisions. Clause 24.9 of the 2000 Award provided:

24.9 Sundays and holidays

24.9.1 Shift workers on continuous shifts for work on a rostered shift the major portion of which is performed on a Sunday or holiday shall be paid as follows:

24.9.1(a) Sundays - at the rate of double time.

24.9.1(b) Holidays as prescribed by clause 29 - Public holidays of this award, at the rate of double time.

24.9.2 Shift workers on other than continuous work for all time worked on a Sunday or holiday shall be paid at the rates prescribed by clause 16 - Classification structure and wage rates, of this award. Where shifts commence between 11.00 p.m. and midnight on a Sunday or a holiday, the time worked before midnight shall not entitle the employee to the Sunday or holiday rate; provided that the time worked by an employee on a shift commencing before midnight on the day preceding a Sunday or holiday and extending into a Sunday or holiday shall be regarded as time worked on such Sunday or holiday.

24.9.3 Where shifts fall partly on a holiday, that shift the major portion of which falls on a holiday, shall be regarded as the holiday shift.

[15] In clause 24.9.2 the cross-reference for the purpose of identifying the Sunday and public holiday rates for non-continuous shiftworkers was changed to clause 16, Classification and wage rates. That cross-reference is also apparently incorrect since clause 16 only contained classification definitions and weekly rates of pay. There is nothing in the Commissioner’s decision which suggested that there was any intention to effect any substantive change to the Sunday and public holiday rates for non-continuous shiftworkers. The purpose of the change is not otherwise able to be identified.

[16] What we glean from the 2009 award modernisation process is that the parties, including the AWU, did not identify the error but simply perpetuated it. The current provision in the Award is the result. To this point, we accept the AWU’s case.

[17] However, it does not follow from this that we should simply attempt to wind back the clock and insert in clause 25.9(b) the penalty rates which may have been intended back in 1990. Proper consideration of this issue by reference to the modern awards objective in s.134(1) requires it to be considered in the light of contemporary circumstances, including but not limited to:

• the extent to which employers covered by the Award use non-continuous shiftworkers on Sundays and public holidays;



• any differences, from the perspective of both employer and employees, between the work of continuous and non-continuous shiftworkers;



• the extent to which employers in the concrete products industry pay award rates, and the rates that are actually paid to non-continuous shiftworkers on Sundays and public holidays.

[18] We note that the AWU at the hearing adduced evidence which went to some of these matters. That evidence demonstrated, broadly speaking, that:

• the limited shift work performed in the industry was generally non-continuous in nature;



• employees were not being paid at ordinary time for this work;



• employees were generally covered by enterprise agreements;



• some enterprise agreements specifically provided for non-continuous shiftworkers to receive double time on Sundays and double time and a half for public holidays, but others incorporated the Award provisions.

[19] This evidence is not without utility, but we would be assisted by further evidence which addressed the issue with greater particularity, including but not limited to evidence from the perspectives of individual employers and employees.

[20] Accordingly we make the following directions:

(1) The AWU shall file any further evidence and submissions it wishes to rely upon in light of this decision within 28 days of the date of this decision.

(2) The employer groups, and any employers covered by the Award, shall file any further evidence and submissions they wish to rely upon in light of this decision within 56 days of the date of this decision.

(3) Upon the above material being received, the Full Bench shall determine whether a further hearing is necessary and, if it is, advise the parties of the date of that hearing.

(4) All submissions are to be sent to amod@fwc.gov.au

[21] Finally and for more abundant caution, nothing in this decision is intended to express any view about the application in relation to this Award made by Brickworks Limited and the Concrete Masonry Association of Australia.

VICE PRESIDENT

Appearances:

S. Crawford for the Australian Workers’ Union.

S. Maxwell for the Construction, Forestry, Mining and Energy Union – Construction and General Division.

V. Paul for the Australian Industry Group.

N. Chan for Australian Business Industrial and NSW Business Chamber.

Hearing details:

2015.

Sydney:

12 October.

 1   MA000056

 2   Transcript of 12 October 2015 at PN228

 3   Print J3654

 4   Print S4842

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