Abmusic (Aboriginal Corporation)

[2020] FWCA 5358

[2020] FWCA 5358

FAIR WORK COMMISSION

DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument

Abmusic (Aboriginal Corporation)
(AG2020/2808)

ABMUSIC ABORIGINAL CORPORATION CERTIFIED AGREEMENT 2005

Local government administration
DEPUTY PRESIDENT BINET	PERTH, 10 NOVEMBER 2020

Application for termination of the Abmusic Aboriginal Corporation Certified Agreement 2005.

[1] Abmusic Aboriginal Corporation (Abmusic) has made an application (Application) to the Fair Work Commission (FWC) to terminate the Abmusic Aboriginal Corporation Certified Agreement 2005 (Agreement).

[2] The Agreement was approved by Deputy President Blain pursuant to section 170LK of the Workplace Relations Act 1996 (Cth), on 12 January 2006 and commenced operation on the same day. The Agreement had a nominal expiry date of 11 January 2009.

[3] The parties to the Agreement are the employees of Abmusic Aboriginal Corporation who are engaged in the classifications contained in the Agreement (Employees), and the employer, Abmusic Aboriginal Corporation.

[4] There are no Employee Organisations who are a party to, or covered by, the Agreement.

[5] For the purpose of Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (Transitional Act), the Agreement is a Collective Agreement-Based Transitional Instrument. By virtue of Item 16 of Schedule 3 of the Transitional Act, the Agreement may be terminated pursuant to section 226 of the Fair Work Act 2009 (Cth) (FW Act).

[6] In support of the Application, Ms Patricia Alessi, the Chief Executive Officer of Abmusic, filed a Statutory Declaration (Alessi Declaration). The Alessi Declaration asserts that the business has significantly evolved since the making of the Agreement in 2005 and as such the scope of the Agreement no longer covers the operations of the business.

[7] On 22 September 2020, directions were issued from Chambers, with respect to the Application (Directions). Abmusic was directed to file an outline of submissions in support of the Application and any evidence on which they relied by 4pm Thursday 8 October 2020.

[8] The Directions also required Abmusic to provide a copy of the materials filed in accordance with the Directions and a copy of the Directions to each of the Employees of Abmusic. The Directions contained an invitation for any of the Employees who wished to be heard in relation to the Application to contact Chambers by Thursday 15 October 2020. None of the Employees contacted Chambers by that date or by the date of this decision.

Background

[9] Abmusic is a registered training organisation operating in the music industry.

[10] There are ten Employees currently covered by the Agreement, including one who is from a non-English speaking background and four of Aboriginal or Torres Strait Islander descent.

Legislation

[11] Subdivision D of Division 7 Part 2-4 of the FW Act sets out the mechanism by which an enterprise agreement may be terminated after the agreement has passed its nominal expiry date.

[12] Section 225 of the FW Act provides that:

“225 Application for termination of an enterprise agreement after its nominal expiry date

If an enterprise agreement has passed its nominal expiry date, any of the following may apply to the FWC for the termination of the agreement:

(a) one or more of the employers covered by the agreement;

(b) an employee covered by the agreement;

(c) an employee organisation covered by the agreement.”

[13] As the Agreement has passed its nominal expiry date and Abmusic is an employer covered by the Agreement, I find that Abmusic has standing to make the Application pursuant to section 225(a) of the FW Act.

[14] Section 226 of the FW Act states:

“226 When the FWC must terminate an enterprise agreement

If an application for the termination of an enterprise agreement is made under section 225, the FWC must terminate the agreement if:

(a) the FWC is satisfied that it is not contrary to the public interest to do so; and

(b) the FWC considers that it is appropriate to terminate the agreement taking into account all the circumstances including:

(i) the views of the employees, each employer, and each employee organisation (if any), covered by the agreement; and

(ii) the circumstances of those employees, employers and organisations including the likely effect that the termination will have on each of them.”

Is it contrary to the public interest to termination the Agreement?

[15] Section 226(a) requires the FWC to be satisfied that it is not contrary to the public interest to terminate the Agreement.

[16] This requires the FWC to consider how the termination of the Agreement might foreseeably affect the public as a whole, such as the impact on the achievement or otherwise of the various objects of the Act, employment levels, inflation and the maintenance of proper industrial standard. 1

[17] There is no positive onus on the applicant to persuade the FWC that there are positive benefits to the public interest arising from the termination. In Geelong Wool Combing Ltd (AIRC) 5 September 2003, Commissioner Wheelan said:

“… the Commission must be persuaded that termination is contrary to the public interest [and] in the absence of any effect of termination which is contrary to the public interest it is not necessary to persuade the Commission that there are positive benefits to the public interest arising from the termination.”

[18] The public interest is distinct in nature from the interests of those covered by the agreement. The views of those covered by an agreement may be relevant to the exercise of the discretion if they shed light on the effect of the termination on public interest but those views should not be given any independent weight. 2

[19] The object of the FW Act is set out in section 3 of the FW Act, as follows:

“3. Object of this Act

The object of this Act is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians by:

…

(b) ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards, modern awards and national minimum wage orders;

…

(f) achieving productivity and fairness through an emphasis on enterprise level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action;

…”

[20] The specific objects in section 171 of the FW Act inform how the general object in section 3 of the FW Act is to be satisfied in the context of matters dealt with in Part 2-4 of the FW Act:

“171. Objects of this Part

The objects of this Part are:

(a)  to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and

(b)  to enable the FWC to facilitate good faith bargaining and the making of enterprise agreements, including through:

(i) making bargaining orders; and

(ii) dealing with disputes where the bargaining representatives request assistance; and

(iii) ensuring that applications to the FWC for approval of enterprise agreements are dealt with without delay.”

[21] The ascertainment of what is not in the public interest does not involve the mere identification of a consequence of the termination of the agreement that is arguably contrary to the public interest. The ascertainment of the public interest may involve balancing countervailing public interests. 3

[22] Abmusic submits that there are no matters contrary to the public interest in terminating the Agreement. and that, rather, there are factors that are in the public interest in terminating the Agreement that may be considered by the Commission.

[23] For example, Abmusic says that termination of the Agreement will ensure the maintenance of proper industrial standards.

[24] Based on the submissions of Abmusic I am satisfied that it is not contrary to the public interest to terminate the Agreement.

What are the views of the Employees covered by the Agreement?

[25] Abmusic tendered evidence of the consultation which it is has undertaken to ascertain the view of the Employees covered by the Agreement. This consultation included providing a copy of the Application to the Employees and posting it in the staff room, as well as notifying Employees by email of the Application and its contents. Ms Alessi says that none of the Employees have raised any concerns about the termination of the Agreement or noted that they wish to remain covered by the Agreement.

[26] The Directions also required Abmusic to provide a copy of the materials filed by the parties in accordance with the Directions and a copy of the Directions to each of the Employees. The Directions contained an invitation for any of the Employees who wished to be heard in relation to the Application to contact Chambers by 4 pm, Thursday 15 October 2020. None of the Employees contacted Chambers by that date or by the date of this decision.

What are the views of the Employee Organisation covered by the Agreement?

[27] There is no Employee Organisation covered by the Agreement.

What are the views of the Employer covered by the Agreement?

[28] Abmusic believes that the Agreement is outdated and unsuitable given the changes to Abmusic’s structure and operations.

What are the circumstances of the Employees covered by the Agreement?

[29] Abmusic submits that the termination of the Agreement will improve the circumstances of Employees by providing them with more current terms and conditions of employment.

What are the circumstances of the Employee Organisation covered by the Agreement?

[30] There are no employee organisations covered by, or a party to, the Agreement.

What are the circumstances of the Employer covered by the Agreement?

[31] Abmusic say that its current form as a small business and registered training organisation will be better served by the applicable Award rather than the Agreement.

Is it appropriate to terminate the Agreement taking into all the circumstances?

[32] In assessing the views and circumstances of the parties it is important to remember that:

“Taking into account the views and circumstances of the parties involves far more than an expression of their views in support or opposition to termination. It should involve a reason for their views and the validity of their concerns.” 4

[33] The Agreement came into effect over 13 years ago and is now more than 10 years past its nominal expiry date. It does not reflect current industry standards or the needs of the business. I am satisfied that Abmusic’s desire to terminate the Agreement is reasonable in the circumstances. There is no evidence of any opposition to the termination from the Employees.

Conclusion

[34] For the reasons enunciated above, I am satisfied that it is not contrary to the public interest to terminate the Agreement.

[35] Taking into account all the circumstances, including the views and circumstances of Abmusic and the Employees, I am satisfied that it is appropriate to terminate the Agreement.

[36] Accordingly, the Agreementis terminated. The termination is to take effect on and from Wednesday, 11 November 2020. An Order to this effect will be issued in conjunction with this Decision.

DEPUTY PRESIDENT

 1   Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000 (2005) 139 IR 34 at 40 – 41.

 2   Ibid.

 3 Kellogg Brown & Root Pty Ltd & Ors and Esso Australia Ltd (2005) 139 IR 34 referred to the decision of the High Court of Australia in Queensland Electricity Commission; Ex parte Electrical Trades Union of Australia (1987) 61 ALJR 393

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