Are your professional employees award-covered?July 15, 2021
Prepared by Brittany Byrne, Partner & Amanda Curatore, Associate
There is a common misconception that professional employees in the Engineering, IT and Science spaces are automatically covered under the Professional Employees Award 2020 (Award). However, determining an employee’s coverage under this Award is a much more complex exercise and needs to be executed with caution.
It is important to understand that the Award is both an industry and occupational award. This throws a fair bit of complication into the mix. The Award applies to businesses engaged in the information technology industry, the quality auditing industry or the telecommunications services industry, and their employees covered by the classifications under the Award. The Award also applies to employees whose jobs involve professional engineering and professional scientific duties, regardless of whether their employer is engaged in the “engineering” or “science” industries.
There has been ongoing uncertainty, resulting in significant litigation, about the function and interpretation of the Award’s coverage clause. Under the Award’s coverage provisions, employees performing professional engineering duties and who meet the criteria in the Award’s classifications are covered by the Award – so are their employers. “Professional engineering duties” means duties carried out by a person in any particular employment, the adequate discharge of any portion of which duties requires qualifications of the employee as (or at least equal to those of) of a graduate member of Engineers Australia.
In the recent unfair dismissal case of Lingli Zheng v Poten & Partners (Australia) Pty Ltd  FWC 1023 the Fair Work Commission was asked to determine the application of the Award to a Consultant in the Natural Gas and LNG industry and, ultimately whether she was protected from unfair dismissal.
In this case, it was accepted by both the employee and the employer that the Consultant performed “professional engineering duties” within the meaning of the Award.
The employee indicated that in her employment she primarily carried out professional engineering duties, held qualifications at least equal to a graduate member of Engineers Australia and was classified as at least a Level 3 – Professional. The employer denied that, while the Consultant performed some professional engineering duties, she was not engaged for the purpose of carrying out professional engineering duties. The employer also said that it did not provide engineering products or services to its clients and that the employee’s duties did not require the employee to possess a graduate engineering qualification or equivalent.
In the first instance, the Fair Work Commission said that, to be covered by the Award, it was necessary the employee “was carrying out professional engineering duties and was employed in a classification in the Award (taking into account the principal purpose for which she was employed)”. It then determined that, despite making a finding that the employee was performing professional engineering duties, those duties were not the principal purpose of the Consultant’s role and, therefore, she was not covered by the Award. This is commonly known as the principal purpose test.
The Consultant appealed the Fair Work Commission’s first instance decision on a number of bases. In that appeal, while not yet finally determined, the Fair Work Commission’s Full Bench decided that the principal purpose test was incorrectly applied by the Fair Work Commission at first instance. It found the Fair Work Commission made a mistake in applying the principal purpose test and, instead, it should have determined that the Consultant, in part, satisfied the requirement in the Award’s coverage provisions because she performed professional engineering duties.
The Full Bench said, “the definition of ‘professional engineering duties’ can be satisfied by reference to ‘any portion’ of the employee’s duties and does not require that the duties falling within that definition are the ‘principal purpose’ for which the employee is employed.”
The appeal has not yet finalised as the parties have been asked to provide further submissions about whether the employee falls within the Level 3 classification under the Award, which of course is a separate requirement to the performance of professional engineering duties.
What does this mean for businesses?
The Full Bench made a compelling statement cautioning employers about the complex operation of the Award’s coverage provisions. It observed that “excessive litigation” as part of unfair dismissal claims has resulted from disputes about whether employees are covered by this Award. This is consistent with our observations.
In this case, the documentary evidence played, and will continue to play, an important role in determining the employee’s award coverage. In particular, the Consultant’s employment agreement (namely her listed duties and responsibilities) and job advertisement have been significant and relevant to the proper characterisation of the nature of the employment.
There are a number of considerations arising from this recent case, and the growing number of disputes occurring from the operation of the coverage provisions in the Award.
Employers are encouraged to:
- Undertake a comprehensive review of their professional employees’ duties and qualifications to determine those employees (if any) that are covered by the Award. In doing this, employers need to ensure they are aware of employees’ qualifications and take a close look at the content of employment agreements, job descriptions, job advertisements, and the employees’ actual duties performed (if different to those duties documented).
- Undertake a review more broadly in relation to the award coverage of its workforce if it has been applying the principal purpose test.
- Ensure that all employment agreements and job descriptions are up-to-date and accurately record the duties, responsibilities, and necessary or preferred qualifications of a role.
- Exercise caution when preparing advertisements for positions to ensure the duties, responsibilities and necessary or preferred qualifications are accurately described.
We can provide you with advice in circumstances where you’re not sure if an employee is covered by the Award or any other modern award, if you need to make changes to an employee’s employment contract relevant to award coverage, if you are faced with a dispute about an employee’s coverage by the Award, or any other relevant matter requiring our assistance.
If you have any questions about this article, or if you wish to discuss any aspect of it, please contact either Brittany Byrne, Partner or Amanda Curatore, Associate at FCB Workplace Law.