Fair Work Australia has rejected an employer’s application to reduce the pay rates of workers in a transfer of business, finding it only has the power to vary ‘working arrangements’. BC Meale’s Pty Ltd (BCM) applied to FWA to vary the Brisbane Concrete Pumping Meale’s (BCPM) Pty Ltd Collective Agreement 2009-11 when it took over BCPM’s mobile concrete pumping business earlier this year. The companies are related corporate entities within Brisbane Concrete Pumping Group.
Rates of pay a ‘commercial constraint’
BCM claimed the rates and allowances in the BCPM agreement were a “commercial constraint” on its operations. It wanted to reduce the allowances and wages of 32 workers who were transferring across from the mobile concreting business, where it had 100 competitors. Nine employees in its high-rise concrete pumping business would remain employed by BCPM so would not be impacted. BCM argued the Fair Work Act’s s 320 governing FWA’s ability to vary transferable instruments should be read broadly. Section 320(2)(c) empowered the tribunal to vary a transferable instrument if the changes will “enable the transferable instrument to operate in a way that is better aligned to the working arrangements of the new employer’s enterprise”. Section 320(4)(e) requires FWA to consider whether the variation would protect the new employer from significant economic disadvantage. BCM argued s320(4)(e) “focused the attention of FWA upon the financial position of the new employer” when considering applications for variations and in the context of s320(2)(c) this included “such matters as labour cost inputs”.
‘Working arrangements’ not about pay
However, Senior Deputy President Peter Richards rejected this. He held the term ‘working arrangements’ could not be read as covering pay rates. “I have no doubt that ‘working arrangements’ form a sub set of an employee’s terms and conditions of employment, but I do not conceive them as being a common set, let alone interchangeable industrial concepts or synonyms,” he said. “The ordinary meaning of ‘working arrangements’ appears to me to be no more than a reference to the way in which the work that is required to be performed is arranged,” SDP Richards said. It covers matters such as “the span of hours, rosters, shifts, cribs breaks and their structures and perhaps RDOs and so forth.” SDP Richards said he saw “no necessary disjunction” between s320(2)(c) and s320(4)(e) if he rejected BCM’s interpretation. “It seems to me that the economic disadvantage to which a new employer might be exposed if a variation in the working arrangements was not approved might be a relevant consideration in determining whether to approve the variation,” he said. He dismissed the application. (BC Meale’s Pty Ltd v CFMEU, FWA 8584, 8/11/10)
Source: Thomson Reuters Workforce news, 12 November 2010. For the full daily issue, sign up for a FREE TWO-WEEK TRIAL of Workforce and other Thomson Reuters premium news services. Click here to sign up.
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