[2018] FWCFB 6849

The attached document replaces the document previously issued with the above code on 13 November 2018.

Typographical error at [16] corrected: ‘Alternation’ corrected to ‘Alteration’.

Associate to Justice Ross, President

Dated 16 November 2018

[2018] FWCFB 6849
FAIR WORK COMMISSION

STATEMENT


Fair Work Act 2009

s.156 - 4 yearly review of modern awards

4 yearly review of modern awards – plain language re-drafting – facilitative provisions altering spread of hours
(AM2016/15)

JUSTICE ROSS, PRESIDENT
VICE PRESIDENT HATCHER
COMMISSIONER HUNT

MELBOURNE, 13 NOVEMBER 2018

4 yearly review of modern awards – plain language re-drafting – spread of hours clauses – remove ambiguity

[1] Section 156 of the Act requires the Fair Work Commission (the Commission) to review all modern awards every four years (the Review).

[2] This statement concerns a possible ambiguity that has been identified in a facilitative clause in a number of awards relating to the alteration to the span of ordinary hours by up to one hour at either end of the spread (the Alteration clause).

[3] An example of the Alteration clause is clause 30.2 in the Food, Beverage and Tobacco Manufacturing Award 2010:

‘30.2 – Ordinary hours of work – day workers

(c) The ordinary hours of work are to be worked continuously, except for meal breaks, at the discretion of the employer between 6.00 am and 6.00 pm. The spread of hours (6.00 am to 6.00 pm) may be altered by up to one hour at either end of the spread, by agreement between an employer and the majority of employees concerned or, in appropriate circumstances, between the employer and an individual employee. (emphasis added)’

[4] The use of the word ‘either’ in the Alteration clause can be interpreted as allowing for the spread of hours (6am to 6pm) to be altered in different ways, for example:

[5] The Fair Work Ombudsman (FWO) identified the above issue in relation to the Alteration clause in 7 awards (including Food, Beverage and Tobacco Manufacturing) in correspondence to the Commission in March 2015. In 2016 a note was inserted into the exposure drafts identified by FWO referring to the ambiguity in the clause and asking parties for submissions. A summary of the submissions received is at Attachment A.

[6] During the award stage of the Review, the AMWU submitted that the span of hours clause in the Pharmaceutical Industry Award 2010 was ambiguous as the word ‘either’ could be interpreted as allowing the spread of hours to be altered by up to one hour at only one end of the span, or one hour at both ends of the span. They proposed an amendment to the clause to insert the words ‘subject to maintaining a 9.5 hours spread’, so it would read as follows:

‘Where the employer and the majority of employees in the affected plant, work section or sections agree, subject to maintaining a 9.5 hours spread, the spread of hours may be altered by up to one hour at either end of the spread.’

[7] The Ai Group opposed this variation and submitted that it was a substantive change. The Ai Group submitted that this issue would arise in a number of awards. The Full Bench decided to defer consideration of this issue until the conclusion of the award stage of the Review.

[8] The span of hours ambiguity issue also arose in the Group 2 decision of 10 October 2016 1 (the October 2016 decision), in relation to the Seafood Processing Award 2010. The Full Bench in the October 2016 decision decided to defer consideration of the issue until the conclusion of the award stage of the review noting that:

[9] The Full Bench in the October 2016 decision noted:

‘We would simply observe at this stage that the word “either” as used in clause 8.2(c) and 13.4 is ambiguous. According to its dictionary definition, it may mean one or both of two possibilities, depending on the context. For example the definition in the Macquarie on-line dictionary is as follows:

“adjective 1. one or the other of two: you may sit at either end of the table. 2. each of the two; the one and the other: there are trees on either side of the river. –pronoun 3. one or the other; not both: take either; either is correct.”

Interested parties should address the issue of ambiguity when the matter arises for final consideration at the conclusion of the Award stage of the Review.’ 2

[10] In the Group 3 award stage decision of 13 March 2018 in relation to the Business Equipment Award 2010, the Full Bench determined that a separate Full Bench would be constituted to deal with the span of hours ambiguity as it had implications for other awards. 3  Further, the AWU 4  and the AMWU 5  submitted that the Sugar Industry Award 2010 was one of a group of awards containing similar ambiguous phraseology in relation to the alteration of the spread of hours which should be dealt with at the conclusion of the award stage of the Review. The Full Bench held that the issue would be dealt with at the conclusion of the award stage of the Review 6.

Award simplification proceedings

[11] During the Award Simplification proceedings, Senior Deputy President Marsh considered whether a variation of the Alteration Clause should be included in a new industry award arising from a review of the Metal Industry Award 1984 and the Graphic Arts – General – Interim Award 1995.

[12] The decision in relation to the Metal Industry Award 1984 7, does not assist with the intended operation of the clause. However, the Alteration Clause was contemplated in more detail in the Graphic Arts – General – Interim Award 19958 decision. At paragraph [147] of that decision, Senior Deputy President Marsh found that the Alteration Clause permits an additional hour to be worked at ordinary time without incurring the penalty or overtime rate, suggesting a narrow interpretation of the clause should be adopted. This interpretation is supported by submissions of employer parties in the matter.

[13] Senior Deputy President Marsh noted that she took into account the following submissions of Mr M Brown (Assistant National Secretary PIAA—Printing Division) stated on transcript:

‘We would ask your Honour to consider for day workers a majority agreement to extend the spread of hours one hour at either one or the other end of a day shift – this provides for a 12 hours spread… (emphasis added).  9

[14] Similarly, Counsel for Ai Group specifically identified the Alteration Clause as one that permits ‘…the spread of hours over which shifts could be worked to be varied by up to 1 hour, a clearly defined range’. 10

[15] Senior Deputy President Marsh concluded:

‘[142] The requirement to pay a morning shift penalty for an entire shift when an extra hour’s work is required is in my view a restriction under Item 51(6)(c) because an efficient allocation of work as access to an early start is inhibited by the obligation to pay the penalty. The same effect results to a lesser extent from the overtime requirement. Productivity may be restricted or hindered. In circumstances where an employee wants to start early fairness to employees is not affected. The evidence demonstrates that early starts do occur by information agreement.

[143] A wide cross section of awards provide for a facilitative clause under which the spread of hours may be altered by up to one hour at either end of the shift [eg., Prints Q6887, Q5897, R0614, R1336, Q0444, N2108, Q5149, Q5884, R1277].

[144] I have given careful consideration to the competing considerations before me and I repeat the conclusion I reached in Metals:

"I adopt the reasoning in 6.1.1(b) in relation to the potential impact of the additional flexibility sought by MTIA. It may well be that access to a more flexible span of ordinary hours meets the needs of particular employees while achieving greater workplace flexibility. The appropriate safeguards should ensure arrangements are genuinely agreed to by an employee or the majority of employees." [Print P9311 p50]

[145] In respect of 6.1.1(b) I stated:

"Under the MTIA provision an employer cannot direct an employee to work ordinary hours on a Saturday or Sunday ie., it is a facilitative provision requiring the agreement of the majority of employees or the individual employee. Having regard to the terms of clause 6.1.1(e) and (f) which provide for penalty rates for Saturday and Sunday I am satisfied that a proper balance can be achieved between workplace flexibility and employee responsibilities and priorities in a way which ensures unfairness to an employee does not result. The provision, which will be subject to the safeguard in clause 2.2.2 (Facilitation by Individual Agreement) and clause 2.2.3 (Facilitation by Majority Agreement), will be inserted into the award..."’ [p50]

[146] On the evidence before me in this matter I am satisfied that a case has been made out pursuant to Item 51(6)(c) to introduce a facilitative clause to vary the span of hours of day workers.

[147] I make it clear that the introduction of a facilitative clause as sought by the employers falls within the scope of facilitation decided in ASD. The level of the shift penalty and the overtime rates is not reduced - the facilitation permits an additional hour to be worked at ordinary time without incurring the penalty or overtime rate but only on an agreed basis.’

Next steps

[16] Alteration clauses in substantially the same terms appear in 11 modern awards (see Attachment B).

[17] The Commission has previously said that this issue will be determined at the conclusion of the award stage of the Review. This part of the Review is now close to finalisation. Accordingly, the President has referred this matter to the plain language Full Bench for determination.

[18] Interested parties are invited to make submissions in relation to the span of hours issue as well as the list of awards at Attachment B. Submissions are due by 4pm on Friday 30 November 2018.

[19] Submissions in reply must be filed by 4pm on Friday 14 December 2018.

[20] All material should be sent to amod@fwc.gov.au.

[21] This matter will be determined on the papers unless any party requests an oral hearing by 30 November 2018.

PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR702102>

Attachment A

List of abbreviations

ATTACHMENT B

List of awards containing a clause allowing for altering the span of hours.

 1   [2016] FWCFB 7254 at [177] – [190]

 2   [2016] FWCFB 7254 at [189] – [190]

 3   [2018] FWCFB 1405 at [235]

 4   AWU submission dated 28 November 2017

 5   AMWU submission dated 28 November 2017

 6   [2018] FWCFB 1405 at [192]

 7   [Print P9311], 11 March 1998.

 8   [Print R7898], 5 August 1999.

 9   Graphic Arts – General – Interim Award 1995 [Print R7898], 5 August 1999, para [147]; Transcript from hearing dated 20 May 1999, p. 84.

 10   Transcript from hearing dated 6 May 1999, p. 370.

 11   As amended in correspondence to the Commission dated 25 November 2014 (to correct a typographical error).

 12  Metal Industry Award 1984 - Part 1 [Print P9311], 11 March 1998.