DECISION

Fair Work Act 2009
s.157—variation of modern award

Viterra Operations Pty Ltd
(AM2019/1)

VITERRA BULK HANDLING AND STORAGE OF GRAINS, PULSES AND MINERALS AWARD 2015
[MA000136]

Application to vary the Viterra Bulk Handling and Storage of Grains Pulses and Minerals Award 2015.

[1] This is an application by Viterra Operations Pty Ltd (Viterra) to vary the Viterra Bulk Handling and Storage of Grains Pulses and Minerals Award 2015 (the Award). The Award is a modern enterprise award within the meaning of s.168A of the Fair Work Act 2009 (the Act).

[2] The application is made under s.157 of the Act and seeks to vary the Award in relation to the skills based career path (SBCP) provisions. In effect, the variations are to incorporate a revised SBCP manual in Schedule D and to make consequential changes to the classification definitions in Schedule C of the Award.

[3] The application is not opposed 1 by the Australian Workers’ Union (AWU) or the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU), both of which have members who are covered by the Award.

[4] In the normal course, an application of this nature would, under s.616 of the Act, be dealt with by a Full Bench. However, on 4 February 2019, the President, acting pursuant to s.582 and s.616(D) of the Act, directed this arm of the Commission to perform the functions and exercise the powers of the Commission in relation to the matter.

[5] Section 157 of the Act provides as follows:

“157 FWC may vary etc. modern awards if necessary to achieve modern awards objective

(1) The FWC may:

(a) make a determination varying a modern award, otherwise than to vary modern award minimum wages or to vary a default fund term of the award; or

(b) make a modern award; or

(c) make a determination revoking a modern award;

if the FWC is satisfied that making the determination or modern award is necessary to achieve the modern awards objective.

Note 1: Generally, the FWC must be constituted by a Full Bench to make, vary or revoke a modern award. However, the President may direct a single FWC Member to make a variation (see section 616).

Note 2: Special criteria apply to changing coverage of modern awards or revoking modern awards (see sections 163 and 164).

Note 3: If the FWC is setting modern award minimum wages, the minimum wages objective also applies (see section 284).

(2) The FWC may make a determination varying modern award minimum wages if the FWC is satisfied that:

(a) the variation of modern award minimum wages is justified by work value reasons; and

(b) making the determination outside the system of annual wage reviews is necessary to achieve the modern awards objective.

Note: As the FWC is varying modern award minimum wages, the minimum wages objective also applies (see section 284).”

[6] Under s.157(1)(a) of Act, the Commission may make a determination varying a modern award if it is satisfied that the making of the determination outside the system of four yearly reviews is necessary to achieve the modern awards objective. This application is made outside of the four yearly review process.

[7] The modern awards objective is set out in section 134(1) of the Act.

“134 The modern awards objective

What is the modern awards objective?

(1) The FWC must ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions, taking into account:

(a) relative living standards and the needs of the low paid; and

(b) the need to encourage collective bargaining; and

(c) the need to promote social inclusion through increased workforce participation; and

(d) the need to promote flexible modern work practices and the efficient and productive performance of work; and

(da) the need to provide additional remuneration for:

(i) employees working overtime; or

(ii) employees working unsocial, irregular or unpredictable hours; or

(iii) employees working on weekends or public holidays; or

(iv) employees working shifts; and

(e) the principle of equal remuneration for work of equal or comparable value; and

(f) the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden; and

(g) the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards; and

(h) the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy.

This is the modern awards objective.

[8] Under s.168B(3) of the Act, a reference to the modern awards objective includes a reference to the modern enterprise awards objective. Under s.168B(2) of the Act, the modern enterprise awards objective applies to the performance of the Commission's functions or powers so far as they relate to modern enterprise awards.

[9] The modern enterprise awards objective is provided in s.168B(1) as follows:

“168B The modern enterprise awards objective

What is the modern enterprise awards objective?

(1) The FWC must recognise that modern enterprise awards may provide terms and conditions tailored to reflect employment arrangements that have been developed in relation to the relevant enterprises. This is the modern enterprise awards objective.”

[10] The SBCP Structure set out in the Award is a system through which an employee may accumulate points for particular skills which Viterra requires the employee to use to perform their duties and which the employee competently holds/achieves (SBCP Skills Points) (Section 5 of the SBCP Structure). The particular skills set out in the SBCP Structure must be performed at Viterra’s sites and each skill is rated according to its difficulty and importance to the employer's business and is allocated points on this basis.

[11] The SBCP Structure also sets out a process by which an employee's SBCP Skills Points may be assessed or reviewed (Section 2 of the SBCP Structure). In accordance with clauses 13.1, Schedule C and Schedule D of the Award, the SBCP Skills Points accumulated by an employee are used to determine their Award classification level. Schedule C of the Award specifies the number of SBCP Skills Points which an employee must accumulate in order to be classified at a particular Award classification level.

[12] Under clause 13.2 of the Award, Viterra is required, in consultation with employees and their representatives, to conduct a review of the classification levels set out in Schedule C and the SBCP Structure incorporated in Schedule D every 4 years (commencing in 2014). The application reflects the results of a recent comprehensive review which includes employees and their representatives; namely the Maritime Union of Australia Division of the CFMMEU and the AWU.

[13] I confirm that Viterra has given a comprehensive “Grandfathering” commitment to deal with the transition to the new SBCP provisions. The terms of this arrangement have been provided in writing to the Commission and to the Unions. Given the enterprise nature of this Award and the variations proposed, I consider that it is sufficient for the Commission to note the existence of these arrangements in this decision.

[14] Having regard to each of the considerations established by the modern awards objective, I am satisfied that the new SBCP arrangements are appropriate and I find that it is appropriate and necessary that they be reflected in the Award. Accordingly, I consider that in all of the circumstances it is necessary to vary the Award as proposed to achieve the modern awards objective.

[15] A Final Determination 2 will be issued in conjunction with this decision. This determination comes into operation from 15 February 2019. In accordance with s.165(3) of the Act, this determination does not take effect until the start of the first full pay period that starts on or after 15 February 2019.

COMMISSIONER

Appearances:

M Harvey, of Minter Ellison, with permission, with A Gilbey for Viterra Operations Pty Ltd.

Hearing details:

2019

Adelaide

February 14

Printed by authority of the Commonwealth Government Printer

<MA000136  PR704937>

 1   Confirmed by correspondence to the Commission and during proceedings before the President on 4 February 2019.

 2   PR704803