Under the Fair Work Act 2009 (Cth), employers are prohibited from requesting or requiring full-time employees to work more than 38 hours per week, unless those additional hours are reasonable.
Under the Fair Work Act 2009 (Cth) (the FW Act), employers are prohibited from requesting or requiring full-time employees to work more than 38 hours per week, unless those additional hours are reasonable.
When considering the reasonableness of additional hours, section 62(3) of the FW Act provides a list of factors which are to be taken into account, such as whether there would be a risk to the employee’s health and safety, the employee’s personal circumstances, any entitlements to overtime, the usual pattern of work in the particular industry or the employee’s role and level of responsibility.
The Federal Court of Australia (the Court) recently considered these factors in a ruling on the reasonableness of additional hours, finding that an employee being required to work 50 hours per week in a meat retail establishment was considered unreasonable.
In Australasian Meat Industry Employees Union v Dick Stone Pty Ltd  FCA 512, the Court heard that the employee secured employment with Dick Stone Pty Ltd (the Employer) three weeks after his arrival to Australia from Ghana.
His employment contract stated that he was engaged as a Knife/Hand Labourer and was expected to work 50 “ordinary work hours” per week between 2am and 11am on weekdays, and between 2am and 7am on Saturdays, plus reasonable additional hours as requested.
The employee was covered by the Meat Industry Award 2010 (the Award) which stipulated that the spread of ordinary hours for covered employees was between 4am and 9pm on weekdays and between 4am and 6pm on Saturdays.
The Australasian Meat and Industry Employees Union commenced proceedings on the employee’s behalf alleging that, amongst other matters, the Employer had:
- Failed to pay the employee overtime for hours in excess of 38 hours per week and outside the span of hours per the Award; and
- Unreasonably required the employee to work 50 ordinary hours per week.
The Court highlighted that there were several deficiencies in the employee’s employment contract, including no mention as to what the employee would be paid, any entitlement to overtime or reference to the Award.
In relation to the overtime issue, the Employer submitted that the employee’s overtime entitlements were offset by the payment of a “blended rate” applied to his 50-hour work week that was above the Award rate, satisfying its obligations under the Award.
However, the Court disagreed, stating that the Employer was not entitled to offset the employee’s overtime entitlements in circumstances where there was no such provision in the contract and also where it had not been communicated to the employee.
The Court therefore held that the Employer had breached the Award by failing to pay the employee overtime rates between 2am and 4am on weekdays and Saturdays.
Turning then to whether it was reasonable for the Employer to require the employee to work a 50-hour work week, the Court considered the following factors pursuant to s 62(3) of the FW Act:
- There was an obvious risk to the employee’s health and safety given that the hours he worked would cause fatigue, which along with the use of knives and heavyweights, could increase the risk of accidents in the workplace;
- The employee was a recent immigrant who likely had no knowledge of Australian law and also had a wife and young child to care for;
- While a 50-hour work week aligned with the Employer’s business needs and was a structure preferred by the majority of its workforce, it did not necessarily mean that the additional hours were reasonable in the employee’s case;
- The employee was entitled to receive overtime payments between 2am and 4am as they were outside the ordinary spread of hours under the Award;
- The employee did not hold a managerial, supervisory or any other additional responsibilities which might justify the requirement to work additional hours;
- The employee was required to regularly and frequently work “unsociable hours” to the extent that it took the employee over the ordinary 5-day working week, depriving him of his weekends;
- The fact that the employee did not attempt to negotiate the additional hours was unsurprising having regard to the fact that he only recently arrived in Australia from a third-world country, needed employment, and was likely to be unfamiliar with Australian law; and
- The employee was not provided with a copy of the Fair Work Information Statement before he started work or as soon as practicable thereafter, depriving him of notice of his employment entitlements.
Having regard to the above factors, the Court found that it was unreasonable for the Employer to require the employee to work an additional 12 hours per week above the 38 hours stipulated by the FW Act. Therefore, it held that the Employer had also contravened s 62 of the FW Act.
The matter has been set down for a further hearing on compensation and penalties.
Lessons for employers
The reasonableness (and lawfulness) of requirements or requests to work additional hours will depend on a number of factors. Employers should assess each individual employee’s circumstances and carefully balance them against the requirements of the business.
This decision also highlights the importance of ensuring that, where applicable, employment contracts contain provisions which permit an employer to “absorb and offset” higher rates of pay against minimum employment entitlements.
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