Application by WA Primary Health Alliance Limited
[2023] FWCA 928
•28 MARCH 2023
| [2023] FWCA 928 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.222 - Application for approval of a termination of an enterprise agreement
Application by WA Primary Health Alliance Limited
(AG2023/423)
| DEPUTY PRESIDENT BINET | PERTH, 28 MARCH 2023 |
Application for termination of the WA Primary Health Alliance Enterprise Agreement 2015
On 23 February 2023 WA Primary Health Alliance Limited (WAPHA) filed an application (Application) pursuant to section 222 of the Fair Work Act 2009 (Cth) (FW Act) for the termination of the WA Primary Health Alliance Enterprise Agreement 2015 (Agreement).
The Application was supported by a Form F24A – declaration in support termination of an enterprise agreement by Ms Elaine Meighan (Ms Meighan) dated 23 February 2023 (Meighan Declaration).
The parties to the Agreement are WAPHA and employees of WAPHA employed on a salaried or an hourly basis (Employees).
There are no employee organisations covered by the Agreement.
On 1 March 2023, directions were issued to the Parties with respect to the Application (Directions). The Directions required WAPHA to file an outline of submissions in support of the Application and any evidence on which WAPHA sought to rely.
The Directions also required WAPHA to provide a copy of the Application, the Meighan Declaration and the Directions to all Employees. The Directions contained an invitation for any Employee who wished to be heard with respect to the Application, to contact the FWC by close of business on Wednesday 22 March 2023. The Directions advised that in the absence of any such contact being made, a conclusion about this Application may be reached on the material before me.
Evidence
In addition to the Meighan Declaration WAPHA filed a witness statement by Ms Meighan. Ms Meighan is Chief People Officer for the WAPHA.
No Employees contacted Chambers by close of business on Wednesday 22 March 2023 or since seeking to be heard in relation to the Application. WAPHA did not seek to be heard orally in relation to the Application. This Application has therefore been determined on the papers.
In reaching my decision I have considered all the submissions made and the evidence tendered, even if not expressly referred to in these reasons for decision.
Background
WAPHA is part of the Australian Government’s national Primary Health Network (PHN) program which aims to strengthen, improve and connect the primary care system. WAPHA works closely with GPs, health professionals, service providers, hospitals, government and the community to strengthen primary care state-wide.[1]
The Agreement is a single enterprise agreement with a nominal expiry date 28 February 2019.
The Agreement was approved by Commissioner Roe pursuant to s 185 of the FW Act, on 29 February 2016 and commenced operation on 7 March 2016.
As at 23 February 2023WAPHA had 222 Employees covered by the Agreement.[2]
WAPHA wishes to terminate the Agreement and provide Employees with more modern terms and conditions of employment.[3]
On 19 December 2022, a letter was emailed to all WAPHA employees to their nominated email account explaining the process for the proposed termination of the Agreement and reasons why WAPHA believed it needed to be terminated.[4]
Amongst other things the letter explained that:[5]
a.If the Agreement was terminated, the terms and conditions of Employees employment would be underpinned by the Health Professionals and Support Services Award 2020 (Award) (if covered) and their contract of employment.
b.Employees would not experience any reduction in the terms and conditions of their employment if the Agreement is terminated, and that their rate of pay, leave accruals and all other entitlements would remain the same.
c.Employees would be invited to attend meetings in January 2023 to discuss the proposed termination and that they would have the opportunity to ask any questions.
Between 19 January 2023 to 25 January 2023 representatives from the WAPHA People and Culture department attended a number of face-to-face meetings with the different teams within WAPHA to discuss with as many employees as possible the reasons why WAPHA believe that Agreement is out of touch with current workplace standards and any Employee questions or concerns.[6] Ms Meighan says that she did not receive any feedback from Employee indicating that they were concerned about the proposed termination of the Agreement.[7]
On 6 February 2023, an email was sent to all Employees to their nominated email account, providing a summary comparison between the Agreement and the Award. The email also provided a draft template contract of employment. It was explained to employees that, if the Agreement was terminated, the terms and conditions of their employment would be underpinned by the Award (if covered) and their contract of employment.[8]
At the same time, all relevant employees were advised of the time and place at which the vote to terminate the Agreement would occur and the voting method (email voting through the ballot agent, Vero Voting).[9]
Voting for the question of whether to terminate the Agreement commenced on 9 February 2023 and concluded on 16 February 2023 with a majority of the employees voting to terminate the Agreement. 222 employees are currently covered by the Agreement. Of those employees, 194 employees cast a valid vote in the ballot and of those employees, 167 employees voted to terminate the Agreement.[10]
Relevant Statutory Provisions
Sections 220, 221, 222, 223 and 224 of the FW Act state:
“220 Employers may request employees to approve a proposed termination of an enterprise agreement
(1) An employer covered by an enterprise agreement may request the employees covered by the agreement to approve a proposed termination of the agreement by voting for it.
(2) Before making the request, the employer must:
(a) take all reasonable steps to notify the employees of the following:
(i)the time and place at which the vote will occur;
(ii)the voting method that will be used; and
(b) give the employees a reasonable opportunity to decide whether they want to approve the proposed termination.
(3) Without limiting subsection (1), the employer may request that the employees vote by ballot or by an electronic method.”
“221 When termination of an enterprise agreement is agreed to
Single-enterprise agreement
(1) If the employees of an employer, or each employer, covered by a single-enterprise agreement have been asked to approve a proposed termination of the agreement under subsection 220(1), the termination is agreed to when a majority of the employees who cast a valid vote approve the termination.
Multi-enterprise agreement
(2) If the employees of each employer covered by a multi-enterprise agreement have been asked to approve a proposed termination of the agreement under subsection 220(1), the termination is agreed to when a majority of the employees of each individual employer who cast a valid vote have approved the termination.”
“222 Application for the FWC’s approval of a termination of an enterprise agreement
Application for approval
(1) If a termination of an enterprise agreement has been agreed to, a person covered by the agreement must apply to the FWC for approval of the termination.
Material to accompany the application
(2) The application must be accompanied by any declarations that are required by the procedural rules to accompany the application.
When the application must be made
(3) The application must be made:
(a) within 14 days after the termination is agreed to; or
(b) if in all the circumstances the FWC considers it fair to extend that period—within such further period as the FWC allows.”
“223 When the FWC must approve a termination of an enterprise agreement
If an application for the approval of a termination of an enterprise agreement is made under section 222, the FWC must approve the termination if:
(a) the FWC is satisfied that each employer covered by the agreement complied with subsection 220(2) (which deals with giving employees a reasonable opportunity to decide etc.) in relation to the agreement; and
(b) the FWC is satisfied that the termination was agreed to in accordance with whichever of subsection 221(1) or (2) applies (those subsections deal with agreement to the termination of different kinds of enterprise agreements by employee vote); and
(c) the FWC is satisfied that there are no other reasonable grounds for believing that the employees have not agreed to the termination; and
(d) the FWC considers that it is appropriate to approve the termination taking into account the views of the employee organisation or employee organisations (if any) covered by the agreement.”
“s.224 When termination comes into operation
If a termination of an enterprise agreement is approved under section 223, the termination operates from the day specified in the decision to approve the termination.”
Consideration
Section 222 of the FW Act provides that an employer covered by an enterprise agreement may request the employees covered by the agreement to approve a proposed termination of the agreement by voting in support of termination of the agreement.
Section 222 sets out three procedural requirements for an application under that section:
a. The application must be brought by a person covered by the agreement.
b.The application be accompanied by any declarations that are required by the procedural rules. Rule 26 of the Fair Work Commission Rules 2013 (Cth) requires that the application be accompanied by a Form F24A statutory declaration.
c. The application must be made within 14 days of the agreement to terminate.
WAPHA is a party to the Agreement and therefore has standing to make the Application. The Application was accompanied by the Meighan Declaration. The termination was agreed to on 16 February 2023.[11] The Application was made on 23 February 2023.
Section 223 of the FW Act sets out four matters of which the FWC must be satisfied before a termination application brought under section 222 may be granted:
a.The FWC must be satisfied that each employer covered by the agreement has complied with subsection 220(2) of the FW Act.
b.The FWC must be satisfied that the termination was agreed to in the case of a single enterprise agreement when the a majority of employees case a valid vote to approve the termination and in the case of multi-enterprise agreements when a majority of the employees of each individual employer who cast a valid vote have approved the termination.
c.The FWC must be satisfied that there are no other reasonable grounds for believing that the employees have not agreed to the termination.
d.The FWC must be satisfied that it is appropriate to approve the termination taking into account the views of any employee organisation covered by the agreement.
Section 223(1) – reasonable opportunity to decide
Subsection 223(1) of the FW Act requires the FWC to be satisfied that WAPHA has complied with subsection 220(2) of the FW Act. Section 220(2) requires an employer to take a number of steps before requesting that employees approve a proposed termination of an enterprise agreement by voting for it.
Subsection 220(2)(a) requires that the employer take all reasonable steps to notify employees of the time and place at which the vote will occur, and the voting method that will be used. To this end, a high proportion of employees voting is strong evidence that the employer took all such reasonable steps.[12]
I am satisfied that WAPHA has complied with subsection 220(2)(a). An email was issued on 6 February 2023 which advised the Employees of the time and place at which the vote was to occur and the voting method used.[13] A large proportion of employees participated in the ballot.[14]
Subsection 220(2)(b) of the FW Act requires the employer to give the relevant employees a reasonable opportunity to decide whether they want to approve the proposed termination. The subsection does not otherwise prescribe any particular steps to be taken to give effect to a “reasonable opportunity”. An employer is not expressly required to explain the effects of the termination on the employees’ terms and conditions. However, the lack of any explanation or misleading or incorrect explanations may be relevant to the FWC’s assessment of whether there has been a “reasonable opportunity”.[15]
I am satisfied that WAPHA gave the relevant employees a reasonable opportunity to decide whether to terminate the Agreement in the sense contemplated by s 220(2). Employees were notified of the proposed termination process on 19 December 2022.[16] WAPHA also explained to relevant employees the impact of the termination and effects on their conditions of employment in various meetings between 19 January 2023 and 25 January 2023.[17] A further email was issued on 6 February 2023 which gave the relevant employees an Agreement Explanation Sheet comparing the key terms of the Agreement and the Health Professionals and Support Services Award 2020.[18] WAPHA also provided the employees with a draft template contract of employment and explained to employees that, if the Agreement was terminated, the terms and conditions of their employment would be underpinned by the Award (if covered) and their contract of employment.[19]
The relevant employees voted on the proposed termination between 9 February 2023 and 16 February 2023. They had a sufficient period in which to consider whether to agree to the proposed termination, during which time they had the opportunity to put further questions to WAPHA and to seek advice. A large proportion of employees participated in the ballot and a large proportion voted in favour of the termination. These factors all point toward a reasonable opportunity having been granted.[20]
Section 223(b) – agreement by employees
Section 223(b) of the FW Act relevantly requires the FWC to be satisfied that the termination was agreed to in accordance with subsection 221(1). Under section 221(1), the termination of a single enterprise agreement is agreed when a majority of employees who cast a valid vote approve the termination.
A total 222 Employees were covered by the Agreement and employed at the time of the request to vote to terminate the Agreement.[21] Of those 222 Employees, 194 cast a valid vote (that is, 28 abstained). 167 of those 194 Employees (that is, 86 per cent) voted in favour of terminating the Agreement.[22]
Section 223(c) – no other reasonable grounds
Section 223(c) requires the FWC to be satisfied that there are no other reasonable grounds for believing that the termination was not agreed by the majority of Employees.
The FWC cannot be satisfied of that negative proposition (“no other reasonable grounds”) without considering whether there are “reasonable grounds” for so believing. In the absence of finding “reasonable grounds” for so believing, the FWC will inevitably be satisfied that there are “no other reasonable grounds”.[23]
86 per cent of Employees who cast a valid vote, voted in favour of terminating the Agreement. They did so after being provided with:
a.a detailed explanation of the process for and consequences of the termination of the Agreement;
b. an opportunity to ask questions;
c. a period of time to consider their decision.
Employees were notified of the opportunity to seek to be heard in relation to the Application and choose not to do so.
In those circumstances, I am satisfied that there are no other grounds – reasonable or otherwise – for believing that the Employees have not agreed to the termination of the Agreement.
Section 223(d) – appropriate to approve termination
Subsection 223(d) requires the FWC to consider it appropriate to approve the termination taking into account the views of any employee organisation(s) covered by the agreement. There are no employee organisations covered by the Agreement.
Section 224 – date of operation of any decision to terminate
If a termination of an enterprise agreement is approved under section 223, the termination operates from the day specified in the decision to approve the termination.WAPHA submits that any decision to approve the termination of the Agreement should come into effect on the date of the decision to approve the termination of the Agreement.
Conclusion
Based on the material that is before me, and in the absence of any request from an Employee to be heard, I am satisfied that WAPHA has complied with its obligations under subsection 220(2), that the termination was agreed to in accordance with subsection 221(1) and that there are no reasonable grounds for believing that the Employees have not agreed to the termination. In these circumstances I must approve the termination of the Agreement.
The termination will come into effect on the date of this decision. An order to this effect will be issued with this Decision.[24]
DEPUTY PRESIDENT
[1] Witness Statement of Ms Elaine Meighan dated 10 March 2023 at [5] (Meighan Witness Statement).
[2] Ibid at [6].
[3] Ibid at [9].
[4] Ibid at [10].
[5] Ibid at [10].
[6] Ibid at [11].
[7] Ibid at [12]-[13].
[8] Ibid at [14].
[9] Ibid at [15].
[10] Ibid at [16]-[17].
[11] Ibid at [16]-[17].
[12] Re Application by Carl Zeiss Vision Australia Holdings Limited [2017] FWCA 5825 at [37].
[13] Meighan Witness Statement (n 1) at [15] and annexure “EM-3”.
[14] Ibid at [17].
[15] Re Application by Barminco Ltd [2015] FWCA 219 at [20]. See also Re Application by Advanced Plumbing and Drains Pty Ltd T/as Advance Plumbing and Drains [2015] FWCA 8740 at [26] and Re Application by Carl Zeiss Vision Australia Holdings Limited [2017] FWCA 5825 at [40].
[16] Meighan Witness Statement (n 1) at [10] and annexure “EM-1”.
[17] Ibid at at [11]-[12] and annexure “EM-2”.
[18] Ibid at at [14] and annexure “EM-3”.
[19] Ibid.
[20] See Advanced Plumbing and Drains Pty Ltd [2015] FWCA 8740 at [32].
[21] Meighan Statement (n 4) at [17] and annexure “EM-4”.
[22] Ibid.
[23] CFMEU v CSRP Pty Ltd [2017] FWCFB 2101 at [27] (Hatcher VP, Gostencnik DP, Bissett C).
[24] PR760455.
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