Coles shop assistants’ casual worker deal struck out

The industrial umpire finds casual workers’ agreement with Coles left employees worse off.

A workplace deal between Coles and the shop assistants union that sets the pay of 75000 of casual workers has been struck out by the industrial umpire which found it left employees worse off.

The rare decision by the full bench of the Fair Work Commission today to intervene in the deal between deal between Coles and the Shop Distributive and Allied Employees Association has cast doubt on “sweetheart” deals between the SDA and retailers and the fast food industry.

It has also been described as a “big wake up call”, to the Commission, which has been accused of rubber stamping deals between unions and employers.

The Coles agreement, which also applied to Bi-Lo stores was endorsed by more than 90 per cent of the workforce but challenged in the Commission by a part-time worker, Duncan Hart, who argued the agreement paid below the legal safety net.

The Commission full bench agreed sided with Mr Hart to conclude the deal failed the “better off overall” test that applies under industrial law and it should never have been ratified by Fair Work.

“For some employees, particularly those who work primarily at times which attract lower penalty rates under the Agreement when compared to the Award, the loss in monetary terms is potentially significant,” the decision states.

“We have considered whether or not the other benefits of the Agreement when compared to the Award can make up for this deficit. We are not satisfied that a consideration of all benefits and detriments under the Agreement results in each employee and each prospective employee being better off overall under the Agreement compared to the Award.”

Coles yesterday defended the deal, with a spokesman saying it “delivered an average increase of 3 per cent in base rates (and) maintained penalty rates from the previous agreement”.

The supermarket chain also stressed that it has “lowered prices for our customers”.

Legal experts yesterday said the case could radically change how retailers negotiated enterprise deals with the SDA, a conservative union which has historically shaped Labor policy on issues such as gay marriage and abortion.

McDonalds has also recently come under fire for striking a deal with the SDA that allegedly paid workers below-award wages.

The Coles EBA set out a higher hourly rate than the relevant award rate, but applied lower penalty payments for evenings, weekends and public holidays.

Additional payments for ordinary hours, rest and meal breaks and payment while on annual leave under the agreement did not make up for the lower penalty rates, the Commission found.

Professor Andrew Steward, industrial relations expert in the faculty of Law at the University of Adelaide, said the result was “high embarrassing for Coles (and) even more embarrassing for the SDA.”

“It also raises questions for the FWC itself. This is a decision that had initially been approved (in an earlier decision). That has been overturned.

“It’s a big wake up call. I’m sure this decision will cause the FWC to look again at the processes and perhaps encourage it to ask more questions, and do more of its own calculations.”

However, he added that “when you’ve got a major union that’s prepared to sign off on an agreement and has helped prepared it, you can understand how the Commission would be prepared to take some of the assertions of the agreement at face value”.

Mr Hart said today that the decision was “all that we could have hoped for”.

Coles has been given the option of giving and undertaking to the Commission to make good on the underpayments, or creating a new agreement.

The Coles spokesman said the company will “respond to today’s decision in due course”.

At a speech to the American Chamber of Commerce in Australia earlier this month, Coles chief executive John Durkan slammed Mr Hart’s case.

“More than 40 people, including representatives from four unions and team member union delegates, spent more than seven months negotiating this agreement, which was approved by the Fair Work Commission in mid-2015,” Mr Durkan said.

“However, under the current workplace relations laws one team member, a weekend casual, represented by a union official from an unrelated union, has been able to hold the fate of 75,000 people’s working conditions hostage over months of argument before the Fair Work Commission.”

“Perversely, if the appellants succeed, the effect would be that Coles’ team members would revert to older, outdated and less-beneficial workplace agreements.”