An examination of CFMMEU v OS MCAP Pty Ltd

By Daniel White, Partner, Alex Millman, Senior Associate and Jacob Fowler, Graduate

On 28 March 2023, the Full Court of the Federal Court of Australia handed down its decision in Construction, Forestry, Maritime, Mining and Energy Union v OS MCAP Pty Ltd [2023] FCAFC 51.

The decision of the Full Bench – comprising Justices Collier, Thomas, and Raper – has already caused many raised eyebrows in the industrial relations sphere for its commentary on how work on public holidays is to be arranged.

Background

OS MCAP Pty Ltd (OS MCAP) employs persons to operate mobile machinery on mine sites throughout Australia, including at the Daunia Mine in Queensland.

OS MCAP’s employees were engaged on contracts which included provision that they may be required to work public holidays, and that payment for such work was included in their remuneration.

Each employee was provided with a laminated roster card at the commencement of their employment which showed all the days on which they would be required to work, including all public holidays that the employee would be expected to work.

In August 2019, OS MCAP became aware of a number of employees putting in applications for annual leave for Christmas Day and Boxing Day.

OS MCAP’s arrangements at Daunia Mine allowed for a maximum of seven employees per roster panel to be absent on planned leave at any one time, which would be exceeded if all requests for annual leave were granted.

OS MCAP undertook a process by which those employees who could be absent on Christmas Day and Boxing Day would be drawn at random, with all remaining employees required to work on the public holidays. Approximately 85 employees worked a 12.5 hour shift on those public holidays.

The relevant legislative provision

At issue in this case was the proper construction of section 114 of the Fair Work Act 2009 (Cth) (FW Act) which relevantly provides as follows:

114 Entitlement to be absent from employment on public holiday

Employee entitled to be absent on public holiday

1. An employee is entitled to be absent from his or her employment on a day or part‑day that is a public holiday in the place where the employee is based for work purposes.

Reasonable requests to work on public holidays

1. However, an employer may request an employee to work on a public holiday if the request is reasonable.
2. If an employer requests an employee to work on a public holiday, the employee may refuse the request if:

• the request is not reasonable; or
• the refusal is reasonable.

The issue

The undisputed evidence before the Full Court was that OS MCAP did not at any time ask its employees if they were willing to work on the public holidays. Instead, it was assumed that employees rostered to work those days would do so unless leave was applied for and granted.

OS MCAP asserted that a “request” to work on a public holiday included a “requirement” to do so.

The Union contended that this approach contravened s.114 of the FW Act.

The court’s decision

The Full Court found in favour of the Union.

The starting point, as the Full Court found, was that employees were entitled to be absent from work on a public holiday (s.114(1)).

From this starting point, employers could request that employees work on a public holiday (s.114(2)). However, s.114(3) specifically empowered employees to refuse such a request in certain circumstances.

By imposing a “requirement” which could not be refused, the Full Court held that OS MCAP had not made a “request” as required by s.114(2).

It therefore followed that the “presumption” in s.114(1) had not been displaced and the employees were entitled to be absent on the public holidays.

The Full Could also observed that the entitlement to be absent on a public holiday in s.114(1), as one of the National Employment Standards (NES), could not be supplanted by any contractual arrangements.

Ramifications

Any term of an enterprise agreement or contract of employment that purports to require work to be performed on a public holiday may not meet the NES requirements, creating an inconsistency, where the NES provisions will ordinarily prevail. This may be the case even when the employee’s roster is to be worked over weekends and public holidays and the employee’s remuneration includes compensation for this requirement.

The consequences of the Full Court’s decision appear to be that employers must presume all employees will be absent from work on a public holiday and they must actively ask employees to work on a public holiday, rather than simply rostering or expecting them to work on a public holiday.

Can an employer require an employee to work on a public holiday?

Despite what the above seems to indicate, the Full Court noted that this does not necessarily prevent an employer from requiring an employee to work on a public holiday.

Importantly, once the request under s.114(2) is made, the employee’s right of refusal under s.114(3) is limited to two scenarios:

1. the request is unreasonable; or
2. the employee’s refusal is reasonable.

As such, provided that:

1. the employer requests the employee to work on the public holiday;
2. the request is reasonable; and
3. the employee has no reasonable basis to refuse the request;

then the employer may require the employee to work on the public holiday in accordance with the request.

The Full Court acknowledged that operational requirements, contractual obligations, and the nature of the enterprise were all factors relevant to the consideration of whether a request to work on a public holiday was reasonable.

The Full Court also acknowledged that such a process may be administratively burdensome, but noted that section 114 was structured in such a way as to avoid employee entitlements being abrogated for convenience.

Practical takeaways

It may be that special leave to the High Court to appeal this decision is sought by OS MCAP.

However, until then, employers must be cognisant of the Full Court’s position on the requirement to work public holidays.

Employers may still include in their contracts of employment advance notice that employees may be required to work public holidays, but the Full Court appears to suggest this cannot be a standing request. Rather, when making arrangements for rostering employees to work on public holidays, it would appear that employers must positively request employees to work on the public holiday, and ideally note that:

1. the employees may refuse the request; but
2. the employer may insist that they work the public holiday if the request is reasonable and there is no reasonable basis for refusal.

The request should be given as far in advance of the specific public holiday as possible. Employers should also inform employees that any refusal must be communicated promptly to allow for discussion or the making of alternative arrangements.

The parameters of non-standard working hours are becoming more and more nebulous given this and other recent decisions of the courts. Mills Oakley recommends seeking legal advice if you are uncertain of your rights and obligations under law.