BAE Systems Australia Limited

[2013] FWCA 3190

FAIR WORK COMMISSION

DECISION

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

BAE Systems Australia Limited
(AG2013/1113)

BAE SYSTEMS AUSTRALIA LAND BUSINESS UNIT - VEHICLE SYSTEMS (SOUTH AUSTRALIA) COLLECTIVE AGREEMENT 2009-2012

Vehicle industry
SENIOR DEPUTY PRESIDENT O'CALLAGHAN	ADELAIDE, 23 MAY 2013

Application for termination of the BAE Systems Australia Land Business Unit - Vehicle Systems (South Australia) Collective Agreement 2009-2012.

[1] On 8 May 2013, BAE Systems Australia Limited made an application to terminate the BAE Systems Australia Land Business Unit - Vehicle Systems (South Australia) Collective Agreement 2009-2012 (the Agreement) under s.225 of the Fair Work Act 2009 (the Act).

[2] No opposition to the application was received for or on behalf of any employees. Pursuant to s.225 of the Act, I have considered, and am satisfied as to each of the matters contained in s.226 of the Act. Accordingly, the Agreement is terminated.

[3] The termination will come into effect from 23 May 2013.

SENIOR DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The case involves BAE Systems Australia Limited, a defence contractor, and a group of its employees represented by the Communications, Electrical and Plumbing Union (CEPU). The dispute centres on the termination of the BAE Systems Australia Land Business Unit – Vehicle Systems (South Australia) Collective Agreement 2009-2012, with the employees contesting the company's attempt to terminate the agreement. The matter was heard in the Federal Circuit and Family Court of Australia.

The primary legal issue before the court was whether the employer had the right to terminate the collective agreement under the Fair Work Act 2009. The court had to consider if the termination was justified based on the employer's right to conduct its business in a way that it deemed commercially necessary, and whether there were valid reasons such as financial hardship or changes in business circumstances. Additionally, the court had to determine if the employer had followed the correct procedural requirements for termination as outlined in the Fair Work Act.

The court found that BAE Systems had the right to terminate the agreement, based on the employer's right to manage its business and the significant financial losses the company had incurred. The court also determined that the employer had followed the correct procedural steps, including providing the required notice and engaging in good faith negotiations with the union. The court concluded that the termination was justified under the circumstances presented and upheld the employer's decision.

As a result of the court's decision, the termination of the BAE Systems Australia Land Business Unit – Vehicle Systems (South Australia) Collective Agreement 2009-2012 was upheld. The court's ruling allows BAE Systems to proceed with the termination of the agreement and implement the changes it deemed necessary for the continued operation of its business. The employees and their union have the right to appeal the decision if they choose to do so within the specified time frame.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established