Alice Springs Resort Enterprises Pty Ltd T/A Chifley Alice Springs Resort

[2015] FWC 5863

[2015] FWC 5863

The attached document replaces the document previously issued with the above code on 24 August 2015.

- The title of the agreement has been included in the preamble

- There have been amendments made to the reference codes in the endnotes

- The publication number has been added to the printing authority at the end of the document

Associate to Commissioner Wilson

Dated 26 August 2015

[2015] FWC 5863

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.225 - Application for termination of an enterprise agreement after its nominal expiry date

Alice Springs Resort Enterprises Pty Ltd T/A Chifley Alice Springs Resort
(AG2014/4117)

VOYAGES HOTELS AND RESORTS (NORTHERN TERRITORY) WORKPLACE AGREEMENT 2008

Northern Territory
COMMISSIONER WILSON	MELBOURNE, 24 AUGUST 2015

Application for Correction Order to Decision to terminate an enterprise agreement after its nominal expiry date.

[1] An application was made to the Fair Work Commission on 25 March 2014 by Alice Springs Resort Enterprises Pty Ltd (Alice Springs Resort), through its solicitors Cridlands MB Lawyers, seeking termination of the Voyages Hotels and Resorts (Northern Territory) Workplace Agreement 2008 (the Agreement).

[2] That application is referred to as the “Termination Application”.

[3] The material submitted with the application consisted of the application form, together with a statutory declaration of Jeff Huyben, Resort Manager, in support of the application.

[4] After consideration of the material before the Commission a decision granting the application was made on 8 April 2014, and the Agreement was terminated with effect from the same day. 1 That decision is referred to as the “Termination Decision”.

[5] In correspondence to the Commission dated 10 July 2015, Voyages Indigenous Tourism Australia Pty Ltd (Voyages) and Delaware North Kings Canyon Pty Ltd (Delaware North), through its solicitors HWL Ebsworth, advised they considered there had been an error made by the Commission in the making of the Termination Decision, and invited the Commission to make an order correcting the error pursuant to the “slip rule” principle.

[6] Having received that correspondence from Voyages and Delaware North, a Statement was issued by me on 31 July 2015, which indicated as follows;

[5] My initial consideration of the request made by Voyages and Delaware North is that I am uncertain as to whether there would be power for the Commission to make the correction sought by them, in the way they seek. In this regard I draw the parties’ attention to the relevant provisions of the Fair Work Act 2009 which deal with corrections, variation and revocation of the Commission’s decisions, namely ss.602 and 603.

[6] On its face, s.603 (Varying and revoking the FWC’s decisions) has no application to this matter. This is for the reason that the decision made by the Commission on 8 April 2014 was pursuant to s.226 of the Act which is within Division 7 of Part 2-4. Section 603(3) provides that the Commission must not vary or revoke certain specified decisions, including a decision under “section 235 or Division 4, 7, 9 or 10 of Part 2-4 (which deal with enterprise agreements)”.

[7] In addition, while it is the case that s.602 (Correcting obvious errors etc, in relation to the FWC’s decisions) gives the Commission power to correct or amend any obvious error, defect or irregularity (whether in substance or form), my initial analysis of this provision would lead me to the view that the power given by the section is in relation to significantly lesser matters than is sought by Voyages and Delaware North. The practical effect of the order sought is for the revocation or reversal of the April 2014 decision made by the Commission, not merely a correction of some error within the decision.

[8] In this regard I note that the Applicant in the termination matter, Alice Springs Resort, pointed out to the Commission after the publication of the initial decision that it contained an error in paragraph [3], namely that it referred to the termination taking effect from 8 April 2013 and not 8 April 2014. On that occasion, the Commission readily made a correction of an obvious error, pursuant to s.602, and amended the date to 8 April 2014.

[9] Of course, what is now sought by Voyages and Delaware North is not within that category of correction.

[7] Further, Voyages and Delaware North were directed by me to serve relevant materials on various parties, and a conference to discuss their proposition was convened on 10 August 2015.

[8] Prior to that conference, Ian Latham, Counsel for Voyages and Delaware North, submitted the following;

“13. In summary, it seems that there is no power that allows the Commissioner to stay and vary the decision in the way sought.

14. It seems that the only power to stay and vary the order would be to appeal the decision to terminate or alternative to seek judicial review in the Federal Court. Judicial review is unlikely to be granted before the appeal process has been exhausted.

15. The Applicants accordingly seek that the application be dismissed so that they may appeal the decision to terminate.

16. The Applicants seek that the Commission could provide short reasons in its decision to dismiss the application. Such reasons would be useful in explaining these unusual circumstances to the Full Bench on appeal.”

[9] The conference held by the Commission on 10 August 2015 comprised of representatives of Voyages, Delaware North and Alice Springs Resort. The conference discussed the circumstance by which the Agreement had been terminated and the correspondence from Voyages and Delaware North regarding the termination.

[10] Voyages and Delaware North were reluctant in that conference to characterise their correspondence as being an “application” to the Commission, however, I consider it is appropriate to treat their correspondence as an application, and determine it as such. I have formed that view because of their invitation that I consider something they want me to do; to decide upon it; and to then issue reasons for decision. I consider the application to be one made pursuant to s.602 of the Act, and refer to the application as the “Correction Application”.

[11] In the course of a conference conducted with the parties on 10 August 2015, the Applicants, Delaware North and Voyages, confirmed that the proposed Draft Correction Order they seek from the Commission is as follows;

“CORRECTION ORDER

The Decision [2014] FWCA 2329 [PR 549432] issued by the Fair Work Commission on 8 April 2014 is corrected as follows:

(a) by deleting orders 2 and 3; and

(b) by inserting the following order:

The Agreement is varied by adding the words "Alice Springs Resort Enterprises Pty Ltd is not a party to the Agreement".

(c) the correction order to come into effect from 8 April 2014.”

[12] Directions were also given by me for the provision of such further material for my consideration as the parties desired I receive. In response to those Directions, Voyages and Delaware North indicated they had no further submissions to make and did not seek a hearing.

[13] Alice Springs Resort made a short submission, as well as confirming that they did not seek a hearing. The Alice Springs Resorts’ submissions, provided through their solicitors, Cozens Johansen, included the following about the Termination Application;

“We are instructed that at all times it was the intention of our client to only have the Workplace Agreement terminated in respect to our client (not the other employers party to the Workplace Agreement).

We are instructed that our client did not notify the other parties to the Workplace Agreement because they were of the understanding that the FWC would notify such parties. Our client noted in the application and statutory declaration that the Workplace Agreement was a multiparty agreement and gave details of the other party (see attached).”

[14] The Termination Decision was made without a hearing, and on the basis of the material before the Commission, which included;

• A Form F24B – Application for termination of an enterprise agreement after the nominal expiry date, which was filed on 25 March 2014, by Patrick Cozens of Cridlands MB Lawyers, and signed by Jeff Huyben; and



• A Form F24C – Statutory declaration in relation to termination of an enterprise agreement after the nominal expiry date, with the declaration being made by Mr Huyben, and dated 25 March 2014.

[15] The Form F24B identified that the Applicant was Alice Springs Resort Enterprises Pty Ltd (ABN/ACN 138 561 234) and that the name of the Agreement to be terminated was the Voyages Hotels and Resorts (Northern Territory) Workplace Agreement 2008. The form identified that the Agreement was a multi-enterprise agreement; that more than one employer was covered by the Agreement; and identified the other employer covered by the Agreement as GPT Resorts Pty Ltd (ABN/ACN 079925036).

[16] The Form F24C also identified that the Agreement is a multi-enterprise agreement and further declared the following as evidence upon which the Commission could rely;

“I submit that it is the public interest to terminate the EBA and have the Hospitality Industry (General) Award 2010 apply to employees of the employer because:

1. following a ballot, the vast majority of employees who voted said that they would prefer that the EBA be terminated so that the Modern Award can apply.

2. Management at the employer would prefer that the Modern Award applies rather than the EBA for a number of reasons including making staffing on weekends and at nights easier, and general administrative ease.

3. The EBA came into effect for an intended term of 3 years from 15 August 2008- this is well over 5 years ago;

4. The EBA was drafted taking into account the now repealed Workplace Relations Act 1996;

5. based on our analysis, the vast majority of employees will be better off financially under the Modern Award.

Ballot

On 27 February 2014 we gave notice to all employees of a Ballot regarding the termination of the EBA to be conducted on 19 March 2014. This notice was provided in employee pay slips as well as through general notices being put up at various locations on the premises. The notice to each employee gave details of what the general financial impact of the change to each employee would mean if the Modern Award applied. We can provide a copy of the individual and general notices if you wish.

On 13 and 14 March 2014 we also held information sessions for managers, and two query sessions open to all employees.

The Ballot was conducted on 19 March 2014. The voting slips were marked as confidential and had a clear "Yes" or "No" answer to the question "Should the Chifley Alice Springs Enterprise Bargaining Agreement be terminated and replaced with the Hospitality Industry (General) Award 2010". Please let us know if you wish to see a sample ballot slip. Our solicitor was present during the voting and answered all questions asked by employees. Employees were asked to sign off their name after they had voted to help prevent double voting but maintain confidentiality. The ballot slips were inserted into a sealed box and then after voting was complete, our solicitor and one of the managers counted the votes. 38 employees voted in the ballot (out of a total of 59 employees). 32 employees voted for "Yes" and 6 employees voted for "No".

[17] The Commission noted that not only was the reference in Mr Huyben’s Statutory Declaration to the name of the Agreement different to the formal name of the Agreement, but that the names of the entities were different, and took that to be a product not only of changes in the corporate structure over the years, but also the deficiencies of the coverage clause of the Agreement, referred to in greater detail below.

[18] The Commission took the above into account in making its Termination Decision, for the purposes of ss.226(a) and (b) of the Act, and in particular to the references above to the “vast majority of employees” being of the view that termination was desirable and to the process being scrutinised by a solicitor being persuasive. The Commission also took into account Mr Huyben’s statutory declaration whereby “we gave notice to all employees of a Ballot regarding the termination of the EBA” (added emphasis). The Commission erroneously believed as a result of that representation, settled and filed by a legal practitioner, that notice of the proposed termination of the Agreement had been given to all employees covered by the Agreement.

[19] The Commission took into account that, as a pre-reform collective agreement, it was empowered to terminate the Agreement under s.226 of the Act for reason of the provisions of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009. 2

[20] In forming its views in relation to s.226(a), which requires the Commission to be satisfied that it is not contrary to the public interest to terminate the agreement, the Commission took into account an analysis prepared by the Commission’s staff of wages that would be payable to employees under the Agreement and the Award to which they would transition.

[21] The Commission also took into account that the Fair Work Commission Rules 2013 required the Applicant to serve the Forms F24B and F24C on each employer and employee organisation covered by the enterprise agreement.

[22] Compliance with the Rules is important, and especially so in this case, for reason that the Agreement’s “Application of Agreement” clause is unusually and undesirably opaque.

[23] The “Application of Agreement” clause provides that the Agreement applies to “your Employer”, with “Employer” being defined as “the entity listed in the definition of Group that employs you from time to time”. “Group” is separately defined in the following way;

“"Group" means Voyages Hotels & Resorts Pty Ltd (ACN 079 925 036) and Kings Canyon Nominees Pty Ltd (ACN 009 652 457) and their related entities.”

[24] There is no identification in the Agreement as to who the related entities may be, or how many there were then, or are now.

[25] When the Termination Application was made, it was made in the name of Alice Springs Resort Enterprises Pty Ltd (ABN/ACN 138 561 234), with it identifying the other employer covered by the Agreement as GPT Resorts Pty Ltd (ABN/ACN 079925036). While the ACN of the second named entity correlated with one of the entities specifically named as being covered by the Agreement, the other did not.

[26] As a result, the Commission had insufficient information available to it to be expected to serve other relevant parties, and took the Applicant to have complied with the Rules.

[27] While the Commission took those matters into account, and that no correspondence was received from the other party covered by the Agreement, it did not check that each employer and employee organisation covered by the enterprise Agreement had been served with the forms, or that they agreed with the application.

[28] With the application having been made to the Commission on 25 March 2014 and allocated to my Chambers the next day, the termination decision was made on 8 April 2014.

[29] No part of the above documents indicated to the Commission that the Applicant in the Termination Application sought “to only have the Workplace Agreement terminated in respect to [Alice Springs Resort] (not the other employers party to the Workplace Agreement)”, as now submitted by Alice Springs Resort.

[30] At the time the Termination Decision was made, the Commission understood it to be dealing with an application to terminate the whole Agreement, and did so, being satisfied of the statutory criteria for the termination of an agreement.

[31] Having considered the circumstances in which the Termination Decision came to be made, and the application now before me for a correction to be made under s.602 of the Act, together with the authorities of the Commission on the subject, I am not satisfied that I should make the order sought.

[32] The following has been held about the purpose of s.602;

“[38] The power to vary or revoke a decision has generally only been exercised where there has been a change in circumstances such as to warrant the variation or revocation of the original decision or, where the initial decision was based on incomplete or false information, fraudulently procured or otherwise.

[39] As a general proposition applications to vary or revoke a decision should not be used to re-litigate the original case. After a case has been decided against a party, that party should not be permitted to raise a new argument which, deliberately or by inadvertence, it failed to put during the original hearing when it had the opportunity to do so.” 3 (references omitted)

[33] The Explanatory Memorandum to the Fair Work Bill 2008 explained the purpose of the proposed s.602 as follows;

“Clause 602 – Correcting obvious errors etc. in relation to FWA’s decisions

2316. In order to avoid unnecessary technicality, clause 602 allows FWA, on its own initiative or on application by a person, to correct or amend any obvious error, defect or irregularity in relation to a decision of FWA (including an instrument made by FWA). This clause is intended to be a statutory analogue of the ‘slip rule’ used by superior courts to correct certain errors in orders (see Re Timber and Allied Industries Award 1999 [2003] AIRC 1137 at [29]-[30]). This clause does not apply, however, to a modern award or a national minimum wage order. (Clauses 160 and 296 deal with corrections to modern awards and national minimum wage orders.)”

[34] The Explanatory Memorandum gives no particular explanation about why s.603 precludes its use in relation to enterprise agreements.

[35] While the slip rule is used solely to rectify an earlier error, 4 the legislature has expressly excluded its use in relation to enterprise agreements. One is then left with the question of whether there is a correction to be made of an obvious error; one that might be plainly not to have been intended to be the result at the time. I am not satisfied that such error is evident. I took the Applicant in the Termination Application to intend to apply for the termination of the Agreement and it was my intent to grant that application.

[36] In considering this matter, I have given consideration to the alternative; that the intention of the Termination Application was misconstrued by me and that it was obvious to all concerned that a mistake had occurred. In such circumstance, what is to be granted in response to the Correction Application?

[37] The termination of an enterprise agreement that has passed its nominal expiry date is dealt with in ss.225 – 227 of the Act, which provide the following;

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.

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.

227 When termination comes into operation

If an enterprise agreement is terminated under section 226, the termination operates from the day specified in the decision to terminate the agreement.” (underlining added)

[38] It is evident from the language of those sections, and in particular the use of the word “terminate” and the use of the definite article in the phrases that have been underlined in the above, that the Commission’s power is for the termination of the whole agreement. The context of the word “terminate” within Part 2-4 of the Act is to bring the agreement to an end. The use of the definite article in the phrase “terminate the agreement” would indicate that the noun is a specific reference. There appears to be no power under those sections for the variation of an agreement to remove a party covered by it, or to terminate the agreement in respect of only a particular party covered.

[39] Such analysis leads to the view that had the Termination Application intended only the variation of the Agreement to remove the coverage of Alice Springs Resorts, or only the termination of the Agreement in respect of that entity, the application would not have been able to be granted. On that basis, there would be nothing to correct. If the intent of the Termination Application was taken as now postulated by Alice Springs Resort, it would not have been granted.

[40] If I have misconstrued the Termination Application, then what is now being asked of me is to revoke the Termination Decision, being a decision under Part 2-4 of the Act. Since revocation of a decision made under Part 2-4 of the Act is expressly prohibited by s.603(3)(b), I am unable to take that course.

[41] For these reasons, I refuse the Correction Application.

COMMISSIONER

 1   [2014] FWCA 2329; original Print reference PR549432 (8 April 2014); correction Print reference PR549943 (23 April 2014)

 2   Schedule 3, Part 3, clause 16

 3   Grabovsky v United Protestant Association of NSW Ltd T/A UPA[2015] FWC 5161, at [38] – [39]

 4   Timber and Allied Industries Award PR937647, at [38]

Printed by authority of the Commonwealth Government Printer

<Price code C, AG865651 PR571176>