Application by Summit Health Incorporated
[2024] FWC 3161
•15 NOVEMBER 2024
| [2024] FWC 3161 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.225—Enterprise agreement
Application by Summit Health Incorporated
(AG2023/1327)
ADELAIDE HILLS DIVISION OF GENERAL PRACTICE INCORPORATED ENTERPRISE AGREEMENT 2011
| Health Services | |
| DEPUTY PRESIDENT ANDERSON | ADELAIDE, 15 NOVEMBER 2024 |
Application for termination of the Adelaide Hills Division of General Practice Incorporated Enterprise Agreement 2011
On 15 October 2024, Summit Health Incorporated T/A Summit Health, previously the Adelaide Hills Division of General Practice (Summit Health, the employer or the applicant) made an application pursuant to s 225 of the Fair Work Act 2009 (Cth) (FW Act) to terminate the Adelaide Hills Division of General Practice Incorporated Enterprise Agreement 2011 (the Agreement).[1] The Agreement passed its nominal expiry date on 30 June 2014.
The President has allocated this application to me for determination, subject to s 615A(3) (concerning when a full bench is required to determine such applications).
The application was supported by a Form F24C statutory declaration of Mr Kevin Wisdom-Hill, Chief Executive Officer, which declared that there were no employees covered by the Agreement, and as such, that its termination would have no adverse effect on any employees. Mr Wisdom-Hill indicated that this was because all existing employees were now covered by two new enterprise agreements which had come into effect following a bargaining process. These agreements were the Summit Health Incorporated Administrative and Project Employees Enterprise Agreement 2024,[2] and the Summit Health Connect Care Allied Health Employees Enterprise Agreement 2024.[3]
In its application, the employer stated that the Australian Nursing and Midwifery Federation (ANMF) was an employee organisation covered by the Agreement.
On 18 November 2024, my chambers wrote to the parties advising the employer and the ANMF that, due to the operation of ss 54 and 58 of the FW Act, there may be no utility in the application as the Agreement may already have ceased to operate. The email was as follows:
“Dear Parties
Matter: AG2024/4073 - Application by Summit Health Inc previous legal name was Adelaide Hills Division of General Practice
The application made by Summit Health Inc dated 15 October 2024 for termination of the Adelaide Hills Division of General Practice Incorporated Enterprise Agreement 2011 (Agreement) has been allocated to Deputy President Anderson.
Deputy President Anderson notes that the grounds on which the application is made are that it is said that persons covered by the Agreement are now covered by two new agreements that have recently come into operation.
If this is the case, there may be no utility in your application because the Agreement for which you are seeking a termination order may have already ceased to have effect due to the automatic operation of ss 54 and 58 of the Fair Work Act 2009 (copies attached). Under these provisions, an earlier agreement that has passed its nominal expiry date ceases to apply to employees if a later agreement covers employees in relation to the same employment (s 58(2)). Section 54(2) states that the earlier agreement will have, by force of law, ceased to operate if that circumstance applies.
Deputy President Anderson recommends that the applicant take advice on this issue and advise chambers by no later than close of business Friday 25 October 2024 whether the termination application you have made is to be proceeded with or discontinued. If it is proceeded with, directions will be issued for a hearing of the matter.”
Sections 54 and 58 provide:
“Section 54 When an enterprise agreement is in operation
(1)An enterprise agreement approved by the FWC operates from:
(a)7 days after the agreement is approved; or
(b)if a later day is specified in the agreement--that later day.
(2)An enterprise agreement ceases to operate on the earlier of the following days:
(a)the day on which a termination of the agreement comes into operation under section 224 or 227;
(b)the day on which section 58 or subsection 278(1A) first has the effect that there is no employee to whom the agreement applies.
Note: Section 58 and subsection 278(1A) deal with when an enterprise agreement ceases to apply to an employee.
(3)An enterprise agreement that has ceased to operate can never operate again.”
“Section 58 Only one enterprise agreement can apply to an employee
Only one enterprise agreement can apply to an employee
(1)Only one enterprise agreement can apply to an employee at a particular time.
General rule - later agreement does not apply until earlier agreement passes its nominal expiry date
(2)If:
(a)an enterprise agreement (the earlier agreement) applies to an employee in relation to particular employment; and
(b)another enterprise agreement (the later agreement) that covers the employee in relation to the same employment comes into operation; and
(c)subsections (3), (4) and (5) do not apply;
then:
(d)if the earlier agreement has not passed its nominal expiry date:
(i)the later agreement cannot apply to the employee in relation to that employment until the earlier agreement passes its nominal expiry date; and
(ii)the earlier agreement ceases to apply to the employee in relation to that employment when the earlier agreement passes its nominal expiry date, and can never so apply again; or
(e)if the earlier agreement has passed its nominal expiry date - the earlier agreement ceases to apply to the employee when the later agreement comes into operation, and can never so apply again.
Special rule - supported bargaining agreement replaces single - enterprise agreement
(3)If:
(a)a single-enterprise agreement applies to an employee in relation to particular employment; and
(b)a supported bargaining agreement that covers the employee in relation to the same employment comes into operation;
the single-enterprise agreement ceases to apply to the employee when the supported bargaining agreement comes into operation, and can never so apply again.
Special rule - single-enterprise agreement replaces single interest employer agreement
(4)If:
(a)a single interest employer agreement applies to an employee in relation to particular employment; and
(b)a single-enterprise agreement that covers the employee in relation to the same employment comes into operation;
the single interest employer agreement ceases to apply to the employee when the single-enterprise agreement comes into operation, and can never so apply again.
Special rule - single - enterprise agreement replaces supported bargaining agreement
(5)If:
(a)a supported bargaining agreement applies to an employee in relation to particular employment; and
(b)a single-enterprise agreement that covers the employee in relation to the same employment comes into operation;
the supported bargaining agreement ceases to apply to the employee when the single-enterprise agreement comes into operation, and can never so apply again.”
A response was received from representatives of the employer on the 25 October 2024:
“25 October 2024
Dear Associate,
APPLICATION BY SUMMIT HEALTH INC PREVIOUS LEGAL NAME WAS ADELAIDE HILLS DIVISION OF GENERAL PRACTICE
FWC MATTER NO.: AG2024/4073We refer to your email correspondence dated 18 October 2024 and confirm we are instructed to act on behalf of Summit Health Inc in respect of this application.
Our client has instructed us that it would like to proceed with the application for termination of the Adelaide Hills Division of General Practice Incorporated Enterprise Agreement (the Agreement).
The basis for this position is that there is a category of employees that technically remains covered by the Agreement, as no new enterprise agreement has been bargained for or commenced operation in relation to them.
Clause 1.3 of the Agreement states that the Agreement is binding on:
· Adelaide Hills Division of General Practice Inc.;
· The Australian Nursing Federation (South Australian Branch) in regard to “Employees” engaged as Nurses; and
· “Employees”.
“Employees” are defined as all employees of Summit Health who perform work described in the classifications at Schedules 3, 4, 5 and 7, but excluding those who require registration as general practitioners, senior staff members engaged under common law contracts or other employees engaged under other employment arrangements (cl 1.2.4).
Schedules 3, 4, 5 and 7 of the Agreement refer to the following categories of employees:
· administrative / project personnel;
· nursing personnel;
· health professional personnel; and
· employees employed as part of “GPcare After Hours” (namely administration / project employees) – a specifically funded healthcare initiative.
As set out in the Form 24C – Declaration in relation to termination of an enterprise agreement after the nominal expiry date, all current employees of Summit Health who were previously covered by the Agreement are now covered by either the Summit Health Incorporated Administrative and Project Employees Enterprise Agreement 2024 or the Summit Health Connect Care Allied Health Employees Enterprise Agreement 2024.
However, “nursing personnel” are not covered by either of these new agreements and would therefore technically remain covered by the Agreement – if Summit Health Inc were to employ any in future.
Summit Health does not currently employ any nursing personnel covered by the Agreement (nor does it intend to do so in the foreseeable future) and we apologise on behalf of our client that reference to this category of employees was inadvertently omitted from the Form 24C.
For these reasons, we consider there to be some utility in proceeding with the application in that termination would provide certainty for Summit Health that if it did decide to employ “nursing personnel” in future, this Agreement would not be the applicable industrial instrument.
If we can be of further assistance to the Deputy President, please advise.
Yours faithfully
Managing Director and Principal
for WORKPLACE LAW”
I issued directions on 25 October 2024.
On 11 November 2024 the ANMF advised:
“The ANMF have corresponded with the Applicant and held consultation with members, we do not object to the termination of Adelaide Hills Division of General Practice Incorporated Enterprise Agreement 2011.”
Neither Summit Health nor the ANMF opposed the termination application being determined on the papers
Legislative provisions
The relevant provisions of the FW Act[4] are as follows:
“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 Terminating an enterprise agreement after its nominal expiry date
(1)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 the continued operation of the agreement would be unfair for the employees covered by the agreement; or
(b)the FWC is satisfied that the agreement does not, and is not likely to, cover any employees; or
(c)all of the following apply:
(i)the FWC is satisfied that the continued operation of the enterprise agreement would pose a significant threat to the viability of a business carried on by the employer, or employers, covered by the agreement;
(ii)the FWC is satisfied that the termination of the enterprise agreement would be likely to reduce the potential of terminations of employment covered by subsection (2) for the employees covered by the agreement;
(iii)if the agreement contains terms providing entitlements relating to the termination of employees’ employment—each employer covered by the agreement has given the FWC a guarantee of termination entitlements in relation to the termination of the agreement.
(1A)However, the FWC must terminate the enterprise agreement under subsection (1) only if the FWC is satisfied that it is appropriate in all the circumstances to do so.
(2)This subsection covers a termination of the employment of an employee:
(a)at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or
(b)because of the insolvency or bankruptcy of the employer.
(3)In deciding whether to terminate the agreement, the FWC must consider the views of the following covered by the agreement:
(a)the employees (unless there are no employees covered by the agreement);
(b)each employer;
(c)each employee organisation (if any).
Note: The President may be required to direct a Full Bench to perform a function or exercise a power in relation to the matter if any of the employers, employees, or employee organisations, covered by the agreement oppose the termination (see subsection 615A(3)).
(4)In deciding whether to terminate the agreement (the existing agreement), the FWC must have regard to:
(a)whether the application was made at or after the notification time for a proposed enterprise agreement that will cover the same, or substantially the same, group of employees as the existing agreement; and
(b)whether bargaining for the proposed enterprise agreement is occurring; and
(c)whether the termination of the existing agreement would adversely affect the bargaining position of the employees that will be covered by the proposed enterprise agreement.
(5)In deciding whether to terminate the agreement, the FWC may also have regard to any other relevant matter.
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.”
Consideration
I am satisfied that Summit Health has standing to make this application as it is the successor to the named employer covered by the Agreement.
Based on the material contained in the statutory declaration filed with the application, subsequent materials received from the parties, and taking into consideration s 226(1)(b), I am satisfied that the agreement does not, and is not likely to, cover any employees.
Having regard to s 226(3)(b), the views of the employer are naturally, by virtue of the application, that it wishes for the Agreement to be terminated.
The ANMF does not oppose the termination of the Agreement (s 226(3)(c)). The ANMF was a bargaining representative for the Agreement when it was made and is covered by the Agreement.
Section 226(2) is not relevant as termination of the Agreement would not give rise to, nor does it arise from, the termination or intended termination of employment of a person covered by the Agreement on the ground of the employer’s redundancy or insolvency.
The considerations at s 226(4) are not strictly relevant as bargaining is not occurring with respect to the Agreement. However, prior to making the application bargaining occurred and concluded with respect to persons covered by the Agreement. Two new agreements were made, have been approved by the Commission and are in operation. Termination of the Agreement would clearly not compromise future bargaining rights of those persons.
The operation of ss 54 and 58 of the FW Act mean that the Agreement has, by force of law, already ceased to operate with respect to those persons. These are those employees other than “nursing personnel” given that two new agreements are in operation covering those categories.
However, the employer seeks an order under s 225 out of an abundance of caution in the event that nursing personnel, who are no longer employed and not on the evidence likely to be employed, become employed in the future.
This is a relevant matter to take into account (s 226(5)) in deciding whether to terminate the Agreement. That, together with the ANMF’s agreement to an order being made and that the Agreement’s nominal expiry was over ten years ago, persuade me that it is appropriate to grant the application.
I observe however that should nursing personnel be employed by Summit Health in the future, it would be appropriate for the employer, such employees and the ANMF to collectively bargain with a view to either making an agreement for such employees or include a nursing personnel classification in the scope of one or other of the new agreements that have been made.
Considered overall, and having regard to s 226(1A) of the FW Act, I am satisfied that it is appropriate in all the circumstances to terminate the Agreement.
Conclusion
The application to terminate the Agreement is approved.
It will take effect from 11.59pm on 15 November 2024. I issue an order[5] to this effect in conjunction with this decision.
DEPUTY PRESIDENT
Hearing:
2024
Adelaide (on the papers)
Written Submissions:
Summit Health Incorporated: 31 October 2024
Australian Nursing and Midwifery Federation: 11 November 2024
[1] [2011] FWAA 8736; see s 53(1) FW Act
[2] [2024] FWCA 2991
[3] [2024] FWCA 2606
[4] Schedule 1 Part 12 Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (commencement 7 December 2022)
[5] PR781306
Printed by authority of the Commonwealth Government Printer
<PR781305>
0
2
0