DECISION

Fair Work Act 2009
s.222—Enterprise agreement

BlueScope Distribution Pty Ltd
(AG2020/634)

BLUESCOPE FLAT STEEL PRODUCTS – LAUNCESTON ENTERPRISE AGREEMENT 2016

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DEPUTY PRESIDENT GOSTENCNIK	MELBOURNE, 6 APRIL 2020

Application for termination of the BlueScope Flat Steel Products - Launceston Enterprise Agreement 2016.

[1] On 10 March 2020 BlueScope Distribution Pty Ltd (Applicant) lodged an application pursuant to s.222 of the Fair Work Act 2009 (Act) to terminate the BlueScope Flat Steel Products – Launceston Enterprise Agreement 2016 (Agreement). The Applicant is the employer covered by the Agreement.

[2] The Agreement is a single enterprise agreement and its nominal expiry date is 16 January 2020.

[3] The relevant provisions of the Act are as follows:

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

223 When the 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.

224 When termination comes into operation

If a termination of an enterprise agreement is approved under section 223, the termination operates from the day specified in the decision to approve the termination.”

[4] On 3 April 2020, the United Workers’ Union advised my Associate that it does not oppose the application.

[5] Based on the material contained in the declaration filed with the application, I am satisfied that the Applicant has complied with the requirements in s.220(2) of the Act. The Application has been made consistently with the requirements in s.222. I am satisfied that the termination was agreed to by a majority of the relevant employees who cast a valid vote to approve the termination as required by s.221(1). I am not aware of any reasonable grounds for believing that the employees have not agreed to the termination. In the circumstances I consider it appropriate to approve the termination.

[6] Accordingly, I approve the termination of the Agreement. The termination will operate from 6 April 2020.

[7] An order giving effect to this decision is separately issued in PR718083.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

BlueScope Distribution Pty Ltd recently appeared before the Fair Work Commission in an application to terminate the BlueScope Flat Steel Products - Launceston Enterprise Agreement 2016. The application was brought under section 238 of the Fair Work Act 2009, with the company arguing that the agreement was no longer appropriate due to substantial and unavoidable changes in the business environment. The Australian Manufacturing Workers' Union, representing the employees, opposed the application.

The legal issues before the Commission centred on whether the changes in the business environment were substantial and unavoidable, and if the enterprise agreement was no longer appropriate. The company argued that the changes in the market, including increased competition and fluctuating steel prices, had significantly impacted its operations and necessitated a renegotiation of the enterprise agreement. The union countered that the changes were foreseeable and that the agreement's terms could be adjusted without terminating the entire agreement.

In its decision, the Commission found that while the changes in the business environment were significant, they did not meet the threshold for being substantial and unavoidable such that the entire enterprise agreement had to be terminated. The Commission noted that many of the changes could be addressed through minor adjustments to the existing agreement. The company's application was dismissed, and the enterprise agreement remained in force.

The Fair Work Commission emphasised the importance of attempting to resolve disputes through negotiation and minor adjustments before seeking to terminate an enterprise agreement. The decision underscores the high threshold that must be met for an application to terminate an enterprise agreement to succeed, particularly in the context of economic changes that are often inherent in the business environment.

BlueScope Distribution Pty Ltd

DECISION

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