Steel company gets the OK to scrap transferring workers’ entitlements

By Jeff Salton on August 23rd, 2017

The Fair Work Commission (FWC) this month has granted BlueScope Steel’s application, under section 318 of the Fair Work Act 2009 (the Act), that it not be covered by an accountancy and consultancy firm’s enterprise agreement, in respect of payroll employees recently transferred to the steel manufacturer.

In January 2017, BlueScope ‘insourced’ the 11 Capgemini employees that were performing BlueScope’s payroll function. There was no substantive change to the functions of any of the transferring employees. This constituted a ‘transfer of business’ under Part 2-8 of the Act.

BlueScope sought to employ the workers under common law contracts instead of the Capgemini Business Services Collective Workplace Agreement 2008 (the Capgemini Agreement).

The employees stood to lose beneficial entitlements contained in the Capgemini Agreement, including: payment of overtime or time off in lieu, a 37.5 hour work week, five days of non-cumulative paid carer’s leave and a paid ‘Capgemini’ day off per year.

Instead, the employees would be covered under the Clerks – Private Sector Award 2010.

The workers, attracted by the higher base rates of salary offered in BlueScope’s proposed contracts, supported their new employer’s application. However, section 318 of the Act requires the FWC to consider various other factors when considering an application, in addition to the views of the employer and employees.

In granting the order, the FWC was most persuaded by the following factors:

  • that no employees would be disadvantaged as a result of the order. The FWC held the increased salaries, in addition to an undertaking to keep the paid carer’s leave and ‘Capgemini’ day off for the rest of 2017, were sufficient to ensure that no employee would be worse off were the order granted;
  • that the nominal expiry date of the Capgemini Agreement was 6 June 2011, more than six years ago; and
  • that retention of the Capgemini Agreement would likely have a negative impact on BlueScope’s productivity.

The FWC accepted that having two sets of different terms and conditions for employees performing similar work would increase BlueScope’s administrative burden and potentially foster disharmony in the workplace.

Do you need more help with determining how to pay new employees or how to deal with employees covered by different awards or agreements? Or just confused about the whole wages issue?

The Employment Law Practical Handbook  is full of information, hints, tips, downloadable templates and forms to help navigate through this difficult terrain.

Comprehensive chapters, all written in plain English, include:

  • T3 Transfer of Employment
  • W1 Wages
  • E1 Employment Contracts
  • E2 Enterprise Agreements
  • G1 General Protections
  • F1 Fair Work Commission
  • L4 Personal Carer’s Leave
  • N1 and N2 National and Non-National Employers

Don’t delay, order your copy of the Employment Law Practical Handbook today on an obligation-free trial and see how these, and any of the other 70-plus chapters that cover all aspects of employment law, can help to simplify your business.

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