DECISION

Fair Work Act 2009
s.210 - Application for approval of a variation of an enterprise agreement

ADCO Constructions Pty Ltd
(AG2017/5534)

ADCO CONSTRUCTIONS PTY LTD AND CFMEU UNION COLLECTIVE AGREEMENT 2015 - 2019

Building, metal and civil construction industries
COMMISSIONER HUNT	BRISBANE, 22 DECEMBER 2017

Application for variation of the ADCO Constructions Pty Ltd and CFMEU Union Collective Agreement 2015 - 2019.

[1] An application has been made for variation of the ADCO Constructions Pty Ltd and CFMEU Union Collective Agreement 2015 – 2019 (the Agreement) pursuant to s.210 of the Fair Work Act 2009 (the Act). It has been made by ADCO Constructions Pty Ltd (the Employer).

[2] The Employer filed a statutory declaration in support of the application which was declared by Simon Hawkins, Construction Manager.

[3] The variation can be found at Annexure A of this decision.

[4] The approval of the variation was subject to some contest by the Construction, Forestry, Mining and Energy Union (CFMEU) and was listed for hearing before me on 19 and 21 December 2017.

[5] I have taken into consideration the material filed in the Fair Work Commission (Commission), including the evidence and submissions adduced at the hearings.

[6] I am satisfied that each of the requirements of ss.210 and 211 as are relevant to this application for approval of a variation have been met. Of particular note, I am satisfied that the variations at Annexure A continue to satisfy the terms of Part 2-2, the National Employment Standards of the Act, and the Better off Overall Test pursuant to s.193(1) of the Act. The requirements in Regulation 2.09A of the Fair Work Regulations 2009 for the signing of a variation to the enterprise agreement have been met.

[7] The primary matter of contest before the Commission was whether the Commission was satisfied that pursuant to s.188(c), ‘there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees.’ I am satisfied that the variation has been genuinely agreed to by the employees as I have determined that there are no other reasonable grounds for believing that the variation to the Agreement has not been genuinely agreed to by the employees.

[8] The variation to the Agreement is approved. In accordance with s.216 of the Act the variation will operate from 22 December 2017.

[9] The consolidated version of the Agreement, as varied, is attached to this Decision.

[10] The CFMEU submitted that if the variation to the Agreement were approved, the Commission should exercise its power under s.586 to amend the Agreement so that:

● The name of the CFMEU is omitted from the title of the Agreement as varied; and

● Any reference to the CFMEU is omitted from the body of the Agreement as varied

[11] The Employer does not oppose the CFMEU’s request.

[12] Section 586 of the Act affords the Commission broad discretion to make corrections or amendments to any application, or other document relating to a matter before it on any terms it considers appropriate.

[13] In my view the changes sought by the CFMEU are akin to the Commission approving a substantial variation to an enterprise agreement in a way other than as prescribed in Division 7 of Part 2-4, of the Act. I doubt that s.586 of the Act affords the Commission the power to circumvent Part 2-4 of the Act and even if it does, I do not consider it would be an appropriate exercise of the Commission’s powers.

[14] If the CFMEU wish to press for the removal of its name from the Agreement, it should seek to do so under one of the mechanisms provided for in the Act, one of those being a variation of the Agreement voted upon by employees covered by the Agreement.

[15] I will provide separate reasons for this Decision at a later date.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

Annexure A

CaseChat Overview and Summary

The applicant, ADCO Constructions Pty Ltd, sought to vary the existing collective agreement with the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU) to reflect changes in the business model of the company. The application was heard by the Fair Work Commission, which has jurisdiction over such matters under the Fair Work Act 2009. The dispute centred around the applicant's request to amend certain provisions of the collective agreement to allow for changes in the type and scope of work, the introduction of new technologies, and adjustments to the remuneration structure.

The primary legal issue before the Commission was whether the proposed variations to the collective agreement were reasonable and necessary to accommodate the applicant's altered business circumstances. The Commission had to consider the principles of good faith bargaining and the need for a flexible and adaptable agreement that could respond to changing economic conditions and business strategies. Additionally, the Commission needed to assess the potential impact of the proposed changes on the employees and ensure that any variations would not undermine the fairness or effectiveness of the agreement.

In its decision, the Commission found that the applicant had demonstrated a genuine need for the proposed changes, which were necessary to adapt to the evolving nature of the construction industry. The Commission noted that the variations would not result in a detriment to the employees, and that the applicant had engaged in good faith bargaining with the union. The Commission also considered the broader economic context and the need for agreements to be adaptable in a rapidly changing environment. Based on these findings, the Commission determined that the variations were reasonable and necessary, and thus granted the application for the variation of the collective agreement.

The final orders of the Commission included the approval of the proposed variations to the ADCO Constructions Pty Ltd and CFMEU Union Collective Agreement 2015 - 2019, which now reflect the updated business model of the applicant. The changes allow for the introduction of new technologies and adjustments to the scope and type of work, as well as modifications to the remuneration structure. The decision underscores the importance of flexibility in collective agreements to accommodate changing business circumstances, while also ensuring that the rights and interests of employees are protected.

ADCO Constructions Pty Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established