| [2016] FWCFB 6333 |
| FAIR WORK COMMISSION |
STATEMENT |
Fair Work Act 2009
s.156 - 4 yearly review of modern awards
JUSTICE ROSS, PRESIDENT |
MELBOURNE, 5 SEPTEMBER 2016 |
4 yearly review of modern awards - common issue - award flexibility - time off instead of payment for overtime.
[1] A model term for providing time off instead of payment for overtime (TOIL) was determined in a decision of 8 July 2016 1. A subsequent decision of 11 July 20162 varied awards which either provide for overtime but did not give employees the option of taking time off instead of payment for working overtime and those that provided TOIL at ‘ordinary rates’, that is, an hour off for an hour of overtime worked. A further decision on 31 August 20163 determined TOIL provisions in another 13 awards including those in the Maritime industry and Resources sector. After the 31 August 2016 decision, only 29 of the 113 modern awards which make provision for paid overtime remain outstanding. Twenty-one of these 29 awards (as listed in Attachment A) currently provide for TOIL at ‘overtime rates’, that is they provide an equivalent amount of time off as would have been paid, e.g. an hour of work at double time will entitle an employee to two hours off.
[2] This statement outlines how the Full Bench will deal with the 21 awards that provide TOIL at overtime rates as well as dealing with eight awards that were the subject of award-specific submissions during earlier consultation processes. We note here that in respect of three of the 21 awards mentioned, there is some doubt as to whether or not TOIL is to be taken at the overtime rate. In order to provide interested parties with an opportunity to comment on the status of these TOIL provisions we will list the following awards for conference at 9.30 am on Monday 12 September 2016 in Sydney:
Airport Employees Award 2010 |
overtime rate | |||
Electrical Power Industry Award 2010 |
overtime rate | |||
Horse and Greyhound Training Award 2010 |
overtime rate |
TOIL at overtime rates
[3] In the decision on 6 October 2015 4 the Full Bench determined that employees who are covered by awards that provide TOIL at ordinary rates should be afforded additional safeguards to protect them from any pressures arising from the “financial incentive” that employers may have to encourage an employee to take TOIL rather than payment for overtime worked5.
[4] In that decision the Full Bench went on to observe that the same level of safeguards were not necessary in those awards where TOIL is calculated by reference to the overtime rate as the financial incentive for employers to enter into a TOIL arrangement on those terms is much less. 6
[5] Accordingly we propose to modify the model TOIL term to be inserted in those awards that provide for TOIL at overtime rates. The extent of the modifications required will depend on the terms of the existing TOIL provisions, which vary considerably between the relevant modern awards.
[6] We will publish draft determinations in the week commencing 12 September 2016 and provide interested persons with four weeks to comment. Following this consultation process the Full Bench will make a decision on the final form of the draft determinations varying the awards listed at Attachment A.
Award-specific submissions
[7] In directions issued on 6 October 2015 interested persons were given an opportunity to make submissions on why a particular award should not be varied to include a model TOIL term. Submissions in relation to the following eight awards were received and are summarised in Attachment B:
[8] These awards will be listed for conference at 10.00 am on Monday 12 September 2016 in Sydney to ascertain the position of the parties regarding the insertion of the model TOIL term.
[9] Any requests for video links should be made to chambers.ross.j@fwc.gov.au by close of business on Thursday 8 September 2016.
PRESIDENT
ATTACHMENT A—Modern awards with TOIL at overtime rates
21 awards (includes 2 awards that are silent on the quantum of time allowed)
This list does not include 2 awards which will be dealt with during the award stage or by another Full Bench (Higher Education—General Staff Award 2010, Vehicle Manufacturing, Repair, Services and Retail Award 2010)
Award code |
Award title |
Overtime provision |
TOIL | |
Airport Employees Award 2010 |
overtime rate | |||
Ambulance and Patient Transport Industry Award 2010 |
overtime rate | |||
Architects Award 2010 |
silent | |||
Corrections and Detention (Private Sector) Award 2010 |
silent | |||
Dry Cleaning and Laundry Industry Award 2010 |
overtime rate | |||
Electrical Power Industry Award 2010 |
overtime rate | |||
Fast Food Industry Award 2010 |
overtime rate | |||
General Retail Industry Award 2010 |
overtime rate | |||
Hair and Beauty Industry Award 2010 |
overtime rate | |||
Horse and Greyhound Training Award 2010 |
overtime rate | |||
Labour Market Assistance Industry Award 2010 |
overtime rate | |||
Mannequins and Models Award 2010 |
overtime rate | |||
Meat Industry Award 2010 |
overtime rate | |||
Nurses Award 2010 |
overtime rate | |||
Pharmacy Industry Award 2010 |
overtime rate | |||
Registered and Licensed Clubs Award 2010 |
overtime rate | |||
Restaurant Industry Award 2010 |
overtime rate | |||
Road Transport and Distribution Award 2010 |
overtime rate | |||
Sporting Organisations Award 2010 |
time and a half within fortnight or single time within 12 months | |||
Textile, Clothing, Footwear and Associated Industries Award 2010 |
overtime rate | |||
Timber Industry Award 2010 |
overtime rate | |||
ATTACHMENT B—Summary of award-specific submissions
Broadcasting and Recorded Entertainment Award 2010 [MA000091] | |
Award provides for TOIL at ordinary rate – 29.5 (Television broadcasting); 52.3(c) (Journalists); at overtime rate – 40.4 (Radio broadcasting – technical staff), 58.4(b) (Cinemas on Sundays & public holidays); no TOIL – 39 (Radio broadcasting – Announcers, broadcasters & journalists), 64 (Actors), 71 (Musicians), 76 (Motion picture production) | |
Seven Network (Operations) Limited, Nine Network Pty Limited, Ten Pty Ltd (represented by Minter Ellison) |
The employer parties’ position is that the issue of whether the model TOIL term should be inserted into the award should be dealt with at the award stage. The parties submit that this should occur because special provision for TOIL is made for journalists under the award (being that the first hour of overtime is paid or taken as TOIL at the discretion of the employer, with subsequent TOIL by agreement) and because it is appropriate to retain existing flexibilities in relation to TOIL for the remaining classes of employees. The parties submit that it is common practice in the industry for agreement on TOIL to be determined by an overarching agreement in advance, and that it would be contrary to the modern awards objective to impose an obligation for agreement to be reached on each occasion. The parties further submit that the model term presents a higher regulatory burden than the existing provisions, and that this requires specific consultation. |
Live Performance Award 2010 [MA000081] | |
Award does not provide for TOIL except in clause 47.5 for some Production and support staff | |
Australian Entertainment Industry Association (Live Performance Australia) |
LPA requests that the issue be dealt with during the award stage, and explored in more detail. Submits that the introduction of TOIL provisions may have little utility or industry support. It submits that this is because the live performance industry operates around ‘seasons’ rather than a traditional work cycle. It is submitted that, for example, TOIL accrued during the rehearsal phase may not be able to be taken because of the immediately following performance phase, and that utilising the provision might result in performers having to be replaced for specific performances, or performances not taking place at all. |
Journalists and Published Media Award 2010 [MA000067] | |
Award provides for TOIL at ordinary rates | |
News Limited, Bauer Media, Pacific Magazines (represented by Minter Ellison) |
The employer parties’ position is that the model TOIL term should not be included in the award, as the award currently provides for TOIL by default, with payment made by mutual agreement. The parties submit that, owing to the unique arbitral history of the pre-reform awards that led to the creation of the Journalists Published Media Award 2010, the issue should be dealt with at the award stage. |
Social, Community, Home Care and Disability Services Industry Award 2010 [MA000100] | |
Award provides for TOIL at ordinary rates | |
Australian Municipal, Administrative, Clerical and Services Union (ASU) |
ASU seeks preservation of the existing requirement that any untaken TOIL that is subsequently paid out must be paid at the rate applying at the time the payment is made, rather than the rate that applied when the overtime was worked. |
Australian Business Industrial and NSW Business Chamber (ABI) |
ABI submits the variation proposed by the ASU is not necessary and will undercut the apparent purpose of the introduction of a model term, which is to create uniformity amongst awards. |
ASU |
ASU submits that, in the event its submissions of 9 November 2015 are not accepted, its preference is that the existing clause 28.2 of the award is retained, rather than the model term being inserted. |
ABI |
ABI submits that clause 28.2 of the award should be retained in preference to the model term (including any variant proposed thereof by the ASU). |
Medical Practitioners Award 2010 [MA000031] | |
Award provides for TOIL at ordinary rates | |
Australian Salaried Medical Officers’ Federation (ASMOF) |
ASMOF submits that as the current TOIL provision appearing in the award is limited to ‘doctors in training’ and requires unused TOIL to be paid out after four weeks, the model term should be varied to accommodate these award specific provisions. |
Health Services Union (HSU) |
HSU supports the submissions of ASMOF of 10 November 2015. |
Pastoral Award 2010 [MA000035] Horticulture Award 2010 [MA000028] | |
Award provides for TOIL at ordinary rates; some Piggery employees under clause 38 may be entitled to TOIL at overtime rates for work on public holidays | |
National Farmers’ Federation (NFF) |
Submits that the model term should not be inserted into the awards or that, in the alternative, the issue should be considered at the award stage. NFF submits that the requirement for a separate written agreement would be unworkable for many farms, particularly on large, remote properties where there is no capacity to enter into daily written agreements. The party submits, for example, that in situations where work has nominally finished for the day, and an urgent situation arises to which an employee responds, the employer may be unaware until the next day what has happened and so unable to have entered into a TOIL agreement the night before. It is submitted that agricultural employees are not always guaranteed access to internet and phone facilities to assist in compliance with the model term, and that the effect of requiring separate written agreements would be to nullify TOIL as an option. NFF submits that there is no evidence that the current arrangements are not working well, or that they are ineffective or unfair. It is submitted that the current arrangement strikes a balance between flexibility and fairness for employees and employers: employees can decide on TOIL or payment, and overtime cannot be accrued without knowledge of employer. NFF submits that setting a finite period during which accrued TOIL must be taken is too restrictive in an agricultural sector linked to animal biology (e.g. calving in the milk industry). It is submitted that the ability of employee to request payment after have initially elected TOIL undermines the ability of farm businesses to plan effectively, and that the requirement that the payment then be made in the next pay period may cause cash flow problems. |
Australian Business Industrial and NSW Business Chamber (ABI) |
As the existing provisions have not caused substantive difficulties for employers or employees since their introduction, and no evidence has been produced to demonstrate that the provisions do not meet the modern awards objective, the party supports and endorses the submissions of the NFF. |
The Australian Workers’ Union (AWU) |
Does not agree with the submissions of the NFF. While the party acknowledges that there is a history to the provisions dealing with TOIL and overtime in the pastoral and horticultural industries, the proposed model TOIL term is superior to the current TOIL provisions in both awards, and will provide greater certainty, security and protection for those employees. The party is particularly supportive of the use of written agreement and prescribed timeframes, and does not believe that agricultural and farming employment situations are unable to accommodate these increased protections for the rights of employees. AWU submits that the model TOIL term provides superior protection for employees who choose to accrue time off instead of being paid for working additional hours for their employer, and as the safeguards that are proposed in the model term are appropriate and workable, the model TOIL term should be inserted into all modern awards as proposed. |
Clerks—Private Sector Award 2010 [MA000002] | |
Award provides for TOIL at ordinary rates | |
Australian Business Industrial and NSW Business Chamber (ABI) |
ABI submits generally that the content and brevity of the existing TOIL clause in many awards ensures it is simple and easy to understand, and that the introduction of the model term would create considerable administrative burdens (particularly in relation to the need for separate written agreements and to take the relevant time off within six months). ABI submits that the Clerks award is distinctive in that it applies to more businesses than any other modern award and applies widely across large, medium and small business. ABI submit that no probative evidence has been heard which displaces the prima facie position that the award (inclusive of its existing TOIL clause) currently satisfied the modern awards objective. |
5 [2015] FWCFB 6847 at [34]–[36].
6 Ibid at [36].
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