DECISION

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

Berkeley Challenge Pty Ltd T/A Berkeley Challenge
(AG2017/5301)

SPOTLESS OPEN SPACE MAINTENANCE ENTERPRISE AGREEMENT 2011

(ODN AG2011/767) [AE885735]

Gardening services
DEPUTY PRESIDENT COLMAN	MELBOURNE, 28 NOVEMBER 2017

Application for termination of the Spotless Open Space Maintenance Enterprise Agreement 2011.

[1] Berkeley Challenge Pty Ltd has applied under s.225 of the Fair Work Act 2009 (Act) to terminate the Spotless Open Space Maintenance Enterprise Agreement 2011 (Agreement). The Agreement is expressed to cover the company and its employees who are covered by the classifications of work described in clause 1.3 of the Agreement and the Australian Workers’ Union (AWU). 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] In correspondence to my chambers of 14 November 2017, the AWU advised that it does not oppose the application. The company’s statutory declaration filed in support of the application states that there are no employees 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 that 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 do so.

[6] The termination will operate from 28 November 2017.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The case of Berkeley Challenge Pty Ltd T/A Berkeley Challenge was heard in the Fair Work Commission. The applicant, Berkeley Challenge, sought the termination of the Spotless Open Space Maintenance Enterprise Agreement 2011. This agreement was an enterprise agreement between Berkeley Challenge and its employees, who are covered by the agreement and work under the maintenance of open spaces. The dispute arose because Berkeley Challenge argued that the agreement was no longer appropriate given changes in the business environment and the need for flexibility in managing its workforce.

The central legal issues before the Commission involved the applicability and enforceability of the existing enterprise agreement in light of the changes in the business environment, as well as the appropriate procedures for terminating the agreement. Berkeley Challenge contended that the agreement should be terminated because it was no longer suitable for the current operational needs of the business, and it had not been formally agreed to by the employees in light of the changes. The Commission needed to determine whether the changes warranted a termination of the agreement and if the correct process for doing so had been followed.

In its decision, the Commission examined the provisions of the Fair Work Act 2009, focusing on the criteria for terminating an enterprise agreement. The Commission concluded that the changes in the business environment did warrant consideration of terminating the existing agreement. However, it was also determined that Berkeley Challenge had not followed the correct procedural steps for termination. The Commission found that the applicant had not made a genuine attempt to negotiate a new agreement with the employees, which is a requirement before termination can be considered. As a result, the application for termination was dismissed. The Commission emphasised the importance of following due process and the need for genuine negotiations before an enterprise agreement can be terminated.

The Fair Work Commission dismissed the application for termination of the Spotless Open Space Maintenance Enterprise Agreement 2011. The Commission emphasised the importance of proper procedural steps and genuine negotiation efforts before terminating an enterprise agreement. The existing agreement remained in effect, and Berkeley Challenge was required to continue negotiations with its employees to address the changes in the business environment.

Berkeley Challenge Pty Ltd T/A Berkeley Challenge

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established