Workplace Express

Employer can allocate overtime to avoid penalty rates: Court

20 August 2018 10:26am

Security giant Wilson is within its rights to avoid paying penalty rates to security guards by allocating their overtime to Sundays, the Federal Court has ruled.

In a decision described by United Voice as "deeply disappointing", Justice Richard Tracey found there was nothing in the Security Services Award to prevent Wilson from rostering overtime hours selectively.

The union last year alleged Wilson Security had underpaid guards by allocating all overtime hours to Sunday shifts – thereby taking advantage of an absence in the award of a requirement to pay a "penalty on a penalty" – regardless of the days on which the employees worked the additional hours (see Related Article).

It argued in a March hearing that the award precluded Wilson from allocating the overtime hours in advance of the worker completing their full complement of 152 ordinary hours in a four-week period.

A contrary finding would lead to an "industrially repugnant result", the union told the court, because employees were entitled to be compensated both for the inconvenience of weekend work and for being required to work overtime.

UV also likened Wilson's approach to one in an MSS Security Pty Limited agreement quashed by an FWC full bench in January last year for failing the BOOT (see Related Article).

Wilson in reply emphasised the competitive nature of the security industry and the low margins available to participants.

But Justice Tracey said both these matters were "extraneous" because the court's decision must depend on the text and context of the award.

"The decisions of the FWC and its predecessor, to which reference has been made, establish that the construction issues involved in this case have been agitated for over the past decade without definitive resolution," he said,

"Conflicting views have been expressed by members of industrial tribunals who have been called on to adjudicate in these ongoing disputes."

Award has no "express" restrictions: Judge

Justice Tracey said the language employed by the draftsman of the award "does not compel the reading in of the kind of restrictions contended for by United Voice".

"Rostering arrangements are within the discretion of the employer," the judge said.

"Consistently with the existence of this discretion the award does not contain any express restrictions on the exercise of that power.

"Absent such express restrictions, the ordinary and natural language of the award, in my view, permits an employer to act in the manner in which [Wilson] has done in the present case."

Justice Tracey said it was open to either party to apply to the FWC for an amendment to the award.

United Voice legal officer Stefan Russell-Uren told Workplace Express that the effect of the decision is that overtime is determined not by the award, but by an employer's discretion.

"This means that a worker who does a 42-hour week commencing on a Monday public holiday can be denied overtime because the employer says that the first four hours of work exceeded ordinary hours," he said.

While the decision's ambit "appeared" to be limited to the security industry, said Russell-Uren, "this is an industry in which workers are deeply reliant on award protections, including overtime".

"United Voice is considering the decision."

United Voice v Wilson Security Pty Ltd [2018] FCA 1215 (August 16, 2018)

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