Earlier this year, the Fair Work Commission handed down a decision about the scope of the Miscellaneous Award, which, arguably, broadens its coverage.

But before we discuss the case, a refresher about the Miscellaneous Award. The Award was created in 2010 when the Commission modernised the award system and streamlined the 6,000 pre modern awards into just 122 awards. Clause 4.2 of the Award provides as follows:

4.2 The award does not cover those classes of employees who, because of the nature or seniority of their role, have not traditionally been covered by awards including managerial employees and professional employees such as accountants and finance, marketing, legal, human resources, public relations and information technology specialists.

Previously, the common view was that this Award only covered employees who were award covered before the modernisation process in 2010. However, in the case of United Voice v Gold Coast Kennels Discretionary Trust t/a AAA Pet Resort [2018] FWCFB 128, this view was successfully challenged.

Facts

United Voice applied to the Commission for permission to appeal the decision of Commissioner Wilson approving the AAA Pet Resort Enterprise Agreement 2017. The Enterprise Agreement was for a pet boarding and grooming house on the Gold Coast. It contained classifications for five levels of employees, including a Level 1 trainee up to a Level 5 Senior Supervisor.

United Voice contended that Commissioner Wilson had erred in concluding that the employees who were covered by the Enterprise Agreement were not covered by a Miscellaneous Award. United Voice argued that the employees were covered by the Miscellaneous Award and, as a result, there had been no proper assessment of whether the Enterprise Agreement passed the BOOT. This was because the Enterprise Agreement had not been measured against the terms and conditions of the Miscellaneous Award, as required under sections 186(2)(d) and 193 of the Fair Work Act 2009 (Cth).

Decision

The Full Bench determined that, when deciding if an employee, or class of employees, could be excluded from coverage of the Miscellaneous Award, regard should be had to two factors:

  1. the classes of employees must not have been traditionally covered by awards
  2. this must have been because of the nature or seniority of their role.

The Full Bench then decided that, having regard to the ‘fundamental characteristics of the employees and their work’, it was clear that the pre-modernisation Awards in New South Wales, Victoria and the Northern Territory covered employees of a similar nature and that it was arguable that the Queensland and Western Australian Awards also had coverage of similar employees.

Further, there was no reason, based on nature or seniority of the employees, that they should be excluded from the coverage of the Miscellaneous Award. The Full Bench considered that the employees were lower skilled and modestly or low-paid and, as such, were the type of employees to whom award coverage is best suited.

The Full Bench also rejected the proposition that, because in Queensland pet boarding businesses have traditionally been Award free, this meant they should not be covered by the Miscellaneous Award. The Full Bench specifically:

  • rejected the proposition that clause 4.2 of the Miscellaneous Award could be interpreted or applied on the basis that it had a differential operation as between the various states dependent on the history of award coverage in each state
  • rejected an attempt by the pet boarding business to rely on previous decisions that approved agreements in the pet boarding industry without reference to the Miscellaneous Award as they viewed them as wrongly decided
  • stated that the employees could be covered by the Miscellaneous Award because the classifications were generic and capable of covering the work done.

Implications

The scope of the Miscellaneous Award may be even broader than previously thought.

This decision may mean that lower paid employees in the federal system will be entitled to the pay and conditions under the Miscellaneous Award, which are more favourable than simply relying on the national minimum wage. Employers can also face a variety of penalties for failing to apply a correct modern award to an employee’s employment.

United Voice also released a statement saying that they believe the decision will provide them with greater ‘standing to appeal against other FWC judgments where it has a broader interest in the matter’. The increased union access to appeal enterprise agreements may lead to increased levels of union involvement in enterprise bargaining in Australia even after an enterprise agreement has been approved.