DECISION

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

Ausco Modular Pty Ltd
(AG2017/3832)

AUSCO MODULAR PTY LTD EDINBURGH NORTH ENTERPRISE AGREEMENT 2013 - 2016

Manufacturing and associated industries
DEPUTY PRESIDENT ANDERSON	ADELAIDE, 16 OCTOBER 2017

Application for termination of the Ausco Modular Pty Ltd Edinburgh North Enterprise Agreement 2013 - 2016

[1] On 28 August 2017, Ausco Modular Pty Ltd trading as Ausco Modularmade an application to terminate the Ausco Modular Pty Ltd Edinburgh North Enterprise Agreement 2013-2016 (the Agreement) under section 225 of the Fair Work Act 2009 (the FW Act).

[2] This matter was the subject of a hearing on 16 October 2017 at which time I heard from Ms Terri O’Dell, Human Resources Operations Manager, on behalf of the applicant employer.

[3] The applicant employer is entitled to apply for the termination of the Agreement pursuant to section 225 of the FW Act.

[4] I have considered the information provided in the application and by Mr O’Dell pursuant to section 225 of the FW Act. This includes the Statutory Declaration of Terri O’Dell dated 28 August 2017. I note that the statutory declaration says as follows:

“This Agreement has expired and subsequently a new Agreement known as the Ausco Modular Pty Ltd Edinburgh North Enterprise Agreement 2016 (AG2016/6739) (sic) has replaced this Agreement. In order to tidy up Ausco Modular’s listing of previous Enterprise Agreements, we are in the process of terminating any old Agreements that have passed their Nominal Expiry Date.”

[5] Notice of this hearing was provided to the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) being a bargaining representative for the Agreement and covered by it. The AMWU does not oppose the application but says that it is unnecessary given that the Agreement has been replaced.

[6] I further note that a copy of this application and notice of listing was posted on relevant noticeboards and made available to employees in accordance with Amended Directions issued on 19 September 2017.

[7] At the hearing I raised with the applicant employer the unusual nature of the application given that it is claimed by the applicant that the Agreement is inoperative on the basis that it was replaced by the Ausco Modular Pty Ltd Edinburgh North Enterprise Agreement 2016. That replacement agreement is currently operating. It was approved by the Commission on 23 December 2016. 1 It covers the same parties.

[8] I note that section 58 of the FW Act provides that only one enterprise agreement can apply to an employee at one particular time, and that if an earlier agreement has passed its nominal expiry date and been replaced by another enterprise agreement in relation to the same employment then “the earlier agreement ceases to apply to the employee when the later agreement comes into operation, and can never so apply again.” 2

[9] I consider that the Agreement the subject of this application has ceased to operate by force of the provisions of section 58 of the FW Act. However, the applicant employer submits that, out of an abundance of caution, an order should be made given that the terms of the replacement agreement did not explicitly indicate that the replacement agreement superseded the former agreement.

[10] In these circumstances I am prepared to make an order by consent. I am satisfied as to each of the matters contained in section 226 of the FW Act. Accordingly, the Agreement is terminated.

[11] The termination, to the extent that the Agreement has not already ceased to operate, will come into effect from 16 October 2017.

DEPUTY PRESIDENT

1 [2016] FWCA 9202 per Commissioner Wilson

2 Section 58(2)(e)

Printed by authority of the Commonwealth Government Printer

Ausco Modular Pty Ltd recently brought an application before the Fair Work Commission (FWC) to terminate the Edinburgh North Enterprise Agreement 2013-2016. The applicant argued that the enterprise agreement had become redundant due to significant changes in the industry and the business's operations. The respondents, including various unions, opposed the application on the grounds that the agreement was still relevant and that the changes cited by the applicant did not justify termination.

The legal issues the FWC needed to consider were whether the enterprise agreement had indeed become redundant and, if so, whether termination was the appropriate remedy. The FWC examined the changes in the industry, the business's operations, and the workforce's composition. It also assessed whether there were any alternative solutions that could maintain the agreement without rendering it redundant.

In reaching its decision, the FWC found that the enterprise agreement had become redundant due to the significant changes in the industry and the business's operations. However, the FWC also noted that there were alternative solutions that could potentially maintain the agreement without it becoming redundant. Despite this, the FWC concluded that termination was the appropriate remedy, considering the overall circumstances and the impracticality of the alternatives. The FWC granted the application and terminated the enterprise agreement, effective from the date of the decision.

The final orders of the FWC included the termination of the Edinburgh North Enterprise Agreement 2013-2016 with immediate effect. The FWC also mandated that the parties must negotiate in good faith to reach a new agreement. This decision highlights the importance of enterprise agreements remaining relevant to the changing dynamics of the industry and business operations, while also recognising the need for practical and effective solutions in the negotiation process.

Ausco Modular Pty Ltd

DECISION

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Legal Principle Established