BAE Systems Australia Limited T/A BAE Systems Proprietary

[2019] FWCA 3932

[2019] FWCA 3932

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
Section 222 - Application for approval of a termination of an enterprise agreement

BAE Systems Australia Limited T/A BAE Systems Proprietary
(AG2019/1474)

BAE SYSTEMS AUSTRALIA PTY LIMITED - JFAS ENTERPRISE AGREEMENT 2016 - 2019

Manufacturing and associated industries
DEPUTY PRESIDENT ANDERSON	ADELAIDE, 7 JUNE 2019

Application for termination of the BAE Systems Australia Pty Limited - JFAS Enterprise Agreement 2016 - 2019

[1] On 9 April 2019, BAE Systems Australia Limited (the applicant employer or BAE Systems)made an application to terminate the BAE Systems Australia Pty Limited - JFAS Enterprise Agreement 2016 - 2019 (the Agreement) under section 222 of the Fair Work Act 2009 (the FW Act).

[2] Section 222 concerns applications for termination where termination has been agreed by employees.

[3] This matter was the subject of a hearing on 7 June 2019 at which time I heard from Ms Angela Martin, Human Resources Manager and Mr Richard Udall, JORN Program Support Manager, on behalf of the applicant employer.

[4] The applicant employer is entitled to apply for termination of the Agreement pursuant to section 222 of the FW Act.

[5] Sections 222 and 223 of the FW Act state:

“222 Application for FWC 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 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 FWC considers it fair to extend that period—within such further period as FWC allows.

223 When 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.”

[6] The Agreement is a single enterprise agreement. It was approved by the Fair Work Commission (the Commission) on 8 March 2017 1. It was approved to operate from 15 March 2017 with a nominal expiry date of 25 May 2019. It has now passed its nominal expiry date.

[7] The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU) was a bargaining representative for the Agreement and is covered by it.

[8] I issued directions on 10 May 2019.

[9] In accordance with my directions, employees covered by the Agreement and the AMWU were provided an opportunity to indicate whether any objection would be taken to the termination application or if they sought to be heard.

[10] No objection has been indicated by any of the employees covered by the Agreement and no employee has sought to be heard.

[11] The AMWU has indicated the following position by email to the Commission dated 20 May 2019:

“Please be advised that the AMWU does not support the application by BAE.

The AMWU fundamentally opposes the tactic of companies terminating enterprise bargaining agreements (EBAs) and replacing them with employment contracts underpinned by industrial awards. The Union believes that this only acts to undermine and weaken workers terms and conditions and provides considerable power imbalance in favour of the employer. The AMWU maintains this position in all termination applications.

In the current matter the AMWU does not object to the application and will rely on the Deputy President determining the matter accordingly.”

[12] I have considered the material provided in the application and by Ms Martin pursuant to section 223 of the FW Act. This includes the Statutory Declaration of Ms Martin lodged with the Commission on 3 May 2019 and the submissions made on 7 June 2019. I note that the Statutory Declaration of Ms Martin says employee briefings and one on one meetings in relation to the termination took place between 4 April 2019 and 16 April 2019 and a secret ballot of employees was held via a voting website between 17 April 2019 and 23 April 2019 at which time a majority of employees voted to terminate the Agreement.

[13] On 17 May 2019, by email to the Commission, Ms Martin indicated that employees were provided with the Notice of Listing, directions, statutory declaration of Ms Martin and application form as directed by the Commission.

[14] I note and take into account the AMWU’s position, both its in-principle objection and its specific position on this application. I further note that the AMWU has indicated that it did not seek to appear or make further submissions on this matter.

[15] In proceedings before me on 7 June 2019, BAE Systems indicated that the employer’s intention was, should the Agreement be terminated, to move the employees to common law contracts underpinned by a modern award. It says each employee was provided, prior to the secret ballot, with a draft of their common law contract, in order to understand their terms and conditions of employment with BAE Systems should the Agreement be terminated.

[16] I am required to deal with this matter in accordance with the provisions of the FW Act. I am satisfied as to each of the matters contained in section 222 and 223 of the FW Act.

[17] Accordingly, it is appropriate to terminate the Agreement. I approve its termination.

[18] The termination will come into effect from 11.59pm on 7 June 2019. An Order to this effect will be issued.

DEPUTY PRESIDENT

 1   [2017] FWCA 1327

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