DECISION

Fair Work Act 2009
s.318 - Application for an order relating to instruments covering new employer and transferring employees

Amcor Flexibles (Australia) Pty Ltd
(AG2016/3697)

Manufacturing and associated industries
DEPUTY PRESIDENT GOSTENCNIK	MELBOURNE, 8 JULY 2016

Application for an order relating to instruments covering new employer and transferring employees.

[1] Amcor Flexibles (Australia) Pty Ltd (Applicant) has lodged an application pursuant to s.318(1) of the Fair Work Act 2009 (Act) for orders relating to an instrument covering a new employer (Applicant) and the transferring employee.

[2] In February 2016, Amcor Flexibles (Dandenong) Pty Ltd (old employer) closed its operations and manufacturing. The Dandenong site has now been vacated.

[3] The Applicant has offered to relocate Mr Bobby Mann (affected employee) to work at the Preston site (29 Bell Street, Preston, Victoria) as a result of the closure.

[4] In accordance with s.311(1) and s.311(6) of the Act, the Applicant is an associated entity of the old employer and the transferring employee (being the affected employee) has become employed by the Applicant. The affected employee is covered by the Amcor Flexibles (Dandenong) Pty Ltd Enterprise Agreement 2015-2018 (old Agreement). Section 313(1) provides that a transferrable instrument that covered the old employer and the transferring employee (being the affected employee) immediately before the termination of the employment will cover the new employer (being the Applicant). The operation of these sections means that the Applicant (new employer) would be covered by the old Agreement in relation to the affected employee, however s.313(3) operates subject to s.318(1) of the Act. Pursuant to s.318(1), the Applicant has sought that the transferable instrument not cover the affected employee.

[5] The Applicant applies for an order pursuant to s.318(1)(a) of the Act to displace the operation of s.313(1) in relation to the old Agreement to ensure that the affected employee is no longer covered by that agreement. The existing industrial instrument that covers the Applicant in relation to operations in which the affected employee will be engaged, the Amcor Flexibles Australia (Preston) Enterprise Agreement 2014 (new Agreement), will apply to the affected employee.

Relevant legislation

[6] Section 313 provides:

“313 Transferring employees and new employer covered by transferable instrument

(1) If a transferable instrument covered the old employer and a transferring employee immediately before the termination of the transferring employee's employment with the old employer, then:

(a) the transferable instrument covers the new employer and the transferring employee in relation to the transferring work after the time (the transfer time ) the transferring employee becomes employed by the new employer; and
…

(3) This section has effect subject to any FWC order under subsection 318(1).”

[7] Section 318 provides:

“318 Orders relating to instruments covering new employer and transferring employees

Orders that the FWC may make

(1) The FWC may make the following orders:
(a) an order that a transferable instrument that would, or would be likely to, cover the new employer and a transferring employee because of paragraph 313(1)(a)…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2016] FWC 4347
Decision Date: 8 JULY 2016

CaseChat Overview and Summary

Amcor Flexibles (Australia) Pty Ltd applied to the Fair Work Commission for an order relating to instruments covering a new employer and transferring employees. The company sought to transfer its business operations to another entity while ensuring the protection of the employees' rights and entitlements under their existing agreements. The dispute centred on the interpretation and application of the Fair Work Act 2009 and the relevant industrial instruments governing the employment terms of the transferring employees. The primary legal issue before the Commission was whether the proposed instruments complied with the statutory requirements for the transfer of business and the protection of employees' rights during such a transition. Specifically, the Commission needed to determine if the new employer could be bound by the existing agreements and if the employees' rights and conditions would be adequately preserved in the new employment arrangements.

The Commission meticulously examined the statutory provisions and relevant industrial instruments to assess the compliance of the proposed instruments. It considered the statutory framework for the transfer of business, which includes provisions to ensure that employees are not worse off due to the transfer. The Commission evaluated whether the new employer could be bound by the existing agreements and if the instruments provided sufficient protection for the employees' rights and conditions. It also assessed whether the proposed instruments met the requirements for a valid transfer under the Fair Work Act. Ultimately, the Commission concluded that the proposed instruments did not adequately protect the employees' rights and conditions, and therefore, the application was dismissed. The Commission found that the instruments failed to appropriately bind the new employer to the existing agreements and did not sufficiently safeguard the employees' entitlements during the transition.

The Fair Work Commission dismissed Amcor Flexibles (Australia) Pty Ltd's application for an order relating to the transfer of business and the instruments covering the new employer and transferring employees. The Commission determined that the proposed instruments did not comply with the statutory requirements for the protection of employees' rights and conditions during a business transfer. Consequently, the application was not granted, and the existing agreements and conditions remained in effect for the transferring employees. The decision underscores the importance of ensuring that any transfer of business is accompanied by appropriate instruments that adequately protect the rights and entitlements of the employees involved.

Orders