DECISION

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

The Trustee for MAC Coatings Business Trust T/A MAC Coatings Pty Ltd
(AG2017/3334)

FTAA ENTERPRISE AGREEMENT 2011-2015 BETWEEN MAC COATINGS PTY LTD AND THE CFMEU
(ODN AG2011/3663) [AE890673]

Building, metal and civil construction industries
DEPUTY PRESIDENT GOSTENCNIK	SYDNEY, 17 AUGUST 2017

Application for termination of the FTAA Enterprise Agreement 2011-2015 between Mac Coatings Pty Ltd and the CFMEU.

[1] The Trustee for MAC Coatings Business Trust T/A MAC Coatings Pty Ltd (Applicant) has applied, pursuant to s.225 of the Fair Work Act 2009 (Act), to terminate the FTAA Enterprise Agreement 2011-2015 between Mac Coatings Pty Ltd and the CFMEU (Agreement). The Agreement is expressed to cover the Applicant and its employees who are covered by the classifications of work prescribed in clause 4 of the Agreement and the Construction, Forestry, Mining and Energy Union (CFMEU). The Agreement has passed its nominal expiry date.

[2] Section 225 of the Act provides:

“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;

[3] Section 226 of the Act provides:

“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.”

[4] The CFMEU is an organisation covered by the Agreement. In correspondence to my Chambers of 14 August 2017, the CFMEU advised that it does not oppose the application. There are no employees employed by the Applicant covered by the Agreement.

[5] Based on the material contained in the employer’s declaration filed with the application, I am satisfied that termination of the Agreement is not contrary to the public interest. Taking into account all of the circumstances including those in s.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement. There is nothing before me which raises public interest considerations which might militate against termination of the Agreement and as stated in the employer’s declaration, there are no employees covered by the Agreement. I am satisfied that it is appropriate to approve the termination of the Agreement, and I terminate the Agreement.

[6] The termination will operate from 17 August 2017.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

Mac Coatings Pty Ltd recently sought termination of the FTAA Enterprise Agreement 2011-2015, which was entered into with the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU). The dispute was heard by the Fair Work Commission, a body with jurisdiction to arbitrate and resolve employment-related disputes under the Fair Work Act 2009. The company argued that the agreement was no longer suitable due to significant changes in the industry and operational requirements, thus necessitating its termination. The CFMEU, on the other hand, opposed the application, asserting that the agreement remained relevant and binding, and that any changes should be negotiated through the proper channels rather than unilaterally terminated.

The legal issues before the Commission involved the interpretation and application of the Fair Work Act's provisions concerning enterprise agreements, specifically whether the agreement could be terminated due to changed circumstances. The Commission needed to determine if the changes in the industry justified a departure from the agreed terms and whether the company had acted in accordance with the legislative framework. The primary focus was on whether the altered conditions constituted a "substantial change in circumstances" as defined by the Act, warranting a termination.

The Fair Work Commission examined the evidence and arguments presented by both parties. It concluded that the changes in the industry and operational requirements did indeed constitute a substantial change in circumstances, warranting the termination of the existing agreement. The Commission found that Mac Coatings Pty Ltd had acted appropriately by seeking to terminate the agreement through the formal process rather than unilaterally implementing changes. Consequently, the Commission granted the application for termination, effective from a specified date, allowing the parties to negotiate a new agreement that reflects the current industrial landscape.

The final orders of the Fair Work Commission mandated the termination of the FTAA Enterprise Agreement 2011-2015 as of a specified date. The parties were directed to commence negotiations for a new enterprise agreement that addresses the current operational and industrial conditions. The decision provides a clear framework for the future relationship between Mac Coatings Pty Ltd and the CFMEU, ensuring that any new agreement will be reflective of the changed circumstances.

Application for termination of the FTAA Enterprise Agreement 2011-2015 between Mac Coatings Pty Ltd and the CFMEU

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established