Resources: Blog

Putting the BOOT in – Coles Supermarkets

Blog
|

The 'better off overall test'

In Duncan Hart v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited T/A Coles and Bi-Lo; the Coles Store Team Enterprise Agreement 2014-17 (the Coles Agreement) came under scrutiny. In particular, matters were raised as to whether or not the employees to be employed under the Coles Agreement were better off under the Coles Agreement or under the General Retail Industry Award 2010.

Duncan Hart v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited T/A Coles and Bi-Lo;


The Australasian Meet Industry Employees Union v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited T/A Coles and Bi Lo
[2016] FWCFB 2887

In our blog If the BOOT Doesn’t Fit earlier this year, we examined how the Fair Work Commission (the Commission) would approach applying the ‘better off over all test’ (the BOOT) when considering approving proposed enterprise agreements.

In order to pass the BOOT, the Commission must be satisfied that at the time the proposed enterprise agreement is assessed, that each award covered employee, and prospective award covered employee, would be better off overall under the agreement as opposed to if they were paid under the relevant modern award.

In Duncan Hart v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited T/A Coles and Bi-Lo; the Coles Store Team Enterprise Agreement 2014-17 (the Coles Agreement) came under scrutiny. In particular, matters were raised as to whether or not the employees to be employed under the Coles Agreement were better off under the Coles Agreement or under the General Retail Industry Award 2010.

The Coles Agreement had been approved by the Commission in July 2015 when Commissioner Bull was satisfied that it had passed the BOOT following undertakings agreed to by Coles.

In October 2015, the Full Bench of the Commission allowed a part-time Coles employee, Mr Duncan Hart to appeal against the decision of Commissioner Bull. Mr Hart, claimed that the Coles Agreement did not pass the BOOT and used his roster as an example to illustrate that he and other employees were worse off under the Coles Agreement when compared to the modern award.

The Full Bench noted that the Coles Agreement provided employees with a higher hourly rate but lower penalty rates for work performed at night, on weekends and public holidays. Mr Hart relied on typical rosters from two Coles stores to submit that some employees were financially disadvantaged due to their particular rostering arrangements.

Coles submitted that the Full Bench should also take into consideration other benefits provided by the Coles Agreement, including additional penalty rates, rest and meal breaks and other leave entitlements. The Full Bench held that whilst regard should be had to these benefits, it also expressed caution on their monetary value. It was noted that the benefits would not be received or accessed by all employees or apply uniformly to all employees. Rest breaks for example, would depend on the shifts that the employee had been assigned and not all employees would access some leave benefits e.g. defence service leave.

Accordingly, the Full Bench held that it was not satisfied that the Coles Agreement passed the BOOT, noting that part-time and casual employees in particular were likely suffer significant monetary loss. The Full Bench did not consider the other benefits provided by the Coles Agreement would result in each employee and prospective employee from being better off.

Coles has been provided with an opportunity to provide an undertaking to address the Full Bench’s concerns about employees who are employed on a high number of hours that attract penalty rates. If an unsatisfactory order is provided, the Full Bench foreshadowed that an Order would be made to allow the appeal and quash the decision of Commissioner Bull.

The Full Bench decision resulted in increased scrutiny in enterprise agreements for larger organisations including Woolworths and McDonalds. Last week it was reported that some McDonald’s employees were paid less under the enterprise agreement in comparison to the applicable Modern Award (i.e. the Fast Food Industry Award 2010).

The decision highlights that while parties may agree on a rate of pay and other benefits, it is the Commission who ultimately determines and assesses whether the rate of pay and other terms and conditions will result in employees and prospective employees being better off over all under the proposed agreement.

Employers should also take note of the views expressed in this decision as to the value of non-monetary benefits such as rest and meal breaks and additional leave entitlements. Traditionally these non-monetary benefits have been included by employers in the belief that they were of value and therefore of assistance when considering the BOOT – this strategy should now be carefully examined in light of the comments from the Full Bench.

 

Information provided in this blog is not legal advice and should not be relied upon as such. Workplace Law does not accept liability for any loss or damage arising from reliance on the content of this blog, or from links on this website to any external website. Where applicable, liability is limited by a scheme approved under Professional Standards Legislation.

 

Similar articles

New annualised salary arrangements in more Awards

Special Edition E-Update

The Fair Work Commission has continued its review of annualised wage arrangements in modern awards.

Read more...

Casual Terms Award Review 2021

NEWS UPDATE

In March 2021, the casual employment amendments to the Fair Work Act 2009 (Cth) (FW Act) introduced a new statutory definition of “casual employee” and an entitlement to casual conversion as one of the National Employment Standards (NES).

Read more...

Workplace Relations Review

Cases and Legislation November 2020

The Federal Circuit Court of Australia has rejected an employee’s claim that she was discriminated against because of her pregnancy and potential pregnancy.

Read more...

Commission applies test confirmed by High Court in distinguishing between employee and contractor

Sham slam

In a recent decision, the Fair Work Commission has applied the test recently confirmed by the High Court of Australia in CFMMEU v Personnel Contracting Pty Ltd [2022] HCA 1 and ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2, in distinguishing between employees and contractors.

Read more...

Full Bench looks at meaning of dismissed for the purposes of the unfair dismissal jurisdiction

Down but not out

The question of whether a demotion will constitute a dismissal under the Fair Work Act 2009 (Cth) was considered by the Full Bench of the Fair Work Commission NSW Trains v James [2022] FWCFB 55.

Read more...

Employer fails to disprove adverse action claim

Step back

A recent decision of the Federal Circuit and Family Court of Australia has reaffirmed the standard of proof that is required to disprove allegations of unlawful adverse action under the Fair Work Act 2009 (Cth).

Read more...

Let's talk

please contact our directors to discuss how ouR expertise can help your business.

We're here to help

Contact Us
Let Workplace Law become your partner in Workplace Relations.

Signup to receive the latest industry updates with commentary from the Workplace Law team direct to you inbox.