Cathay Pacific Airways Limited
[2023] FWCA 2541
•14 AUGUST 2023
| [2023] FWCA 2541 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.225—Enterprise agreement
Cathay Pacific Airways Limited
(AG2023/2624)
CATHAY PACIFIC AIRWAYS LIMITED AUSTRALIAN BASED AIRCREW ENTERPRISE AGREEMENT 2020
| Airline operations | |
| COMMISSIONER SIMPSON | BRISBANE, 14 AUGUST 2023 |
Application for termination of the Cathay Pacific Airways Limited Australian Based Aircrew Enterprise Agreement 2020
Cathay Pacific Airways Limited (the Applicant) has filed an application pursuant to s.225 of the Fair Work Act 2009 (the Act) to terminate the Cathay Pacific Airways Limited Australian Based Aircrew Enterprise Agreement 2020 (the Agreement) after its nominal expiry date.
The Agreement is a single enterprise agreement and its nominal expiry date was 31 March 2023.
The application indicated that the Agreement covers Australian Aircrew Officers Association (AAOA). However, the AAOA’s registration was cancelled effective 15 April 2022.[1] Cathay Pacific does not have any ongoing communication with the AAOA.
Section 225 and 226 of the Act relevantly 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;
(c) an employee organisation covered by the agreement.
226 Terminating an enterprise agreement after its nominal expiry date
(1) 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 the continued operation of the agreement would be unfair for the employees covered by the agreement; or
(b) the FWC is satisfied that the agreement does not, and is not likely to, cover any employees; or
(c) all of the following apply:
(i) the FWC is satisfied that the continued operation of the enterprise agreement would pose a significant threat to the viability of a business carried on by the employer, or employers, covered by the agreement;
(ii) the FWC is satisfied that the termination of the enterprise agreement would be likely to reduce the potential of terminations of employment covered by subsection (2) for the employees covered by the agreement;
(iii) if the agreement contains terms providing entitlements relating to the termination of employees’ employment—each employer covered by the agreement has given the FWC a guarantee of termination entitlements in relation to the termination of the agreement.
(1A) However, the FWC must terminate the enterprise agreement under subsection (1) only if the FWC is satisfied that it is appropriate in all the circumstances to do so.
(2) This subsection covers a termination of the employment of an employee:
(a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or
(b) because of the insolvency or bankruptcy of the employer.
(3) In deciding whether to terminate the agreement, the FWC must consider the views of the following covered by the agreement:
(a) the employees (unless there are no employees covered by the agreement);
(b) each employer;
(c) each employee organisation (if any).
Note: The President may be required to direct a Full Bench to perform a function or exercise a power in relation to the matter if any of the employers, employees, or employee organisations, covered by the agreement oppose the termination (see subsection 615A(3)).
(4) In deciding whether to terminate the agreement (the existing agreement), the FWC must have regard to:
(a) whether the application was made at or after the notification time for a proposed enterprise agreement that will cover the same, or substantially the same, group of employees as the existing agreement; and
(b) whether bargaining for the proposed enterprise agreement is occurring; and
(c) whether the termination of the existing agreement would adversely affect the bargaining position of the employees that will be covered by the proposed enterprise agreement.
(5) In deciding whether to terminate the agreement, the FWC may also have regard to any other relevant matter.
The Form F24C declaration, signed by Jack Bennett, states that there are no employees covered by the Agreement. Mr Bennett stated that this is as a result of permanent changes in the nature of Cathay Pacific’s operations and is not a transient circumstance.
Specifically, the Form F24C stated that the Agreement applied to all Aircrew Officers who were employed by Cathay Pacific and permanently based in Australia. Cathay Pacific ceased operations of its Australian pilot base with effect from 30 September 2021, and all Aircrew Officers covered by the Agreement ceased to be employed by Cathay Pacific on or before that date. All Aircrew Officers covered under the Agreement were either made redundant (in accordance with clause 20 of the Agreement), or accepted redeployment to Cathay Pacific's pilot base in Hong Kong. The closure of all Cathay Pacific pilot base operations in Australia arose as a result of a decision by the Cathay Pacific group to restructure its international operations. Cathay Pacific has no intention of re-opening a pilot base in Australia in the future, and therefore the Agreement has no ongoing utility for or application to Cathay Pacific employees.
The Form F24C provided that termination of the Agreement would not adversely impact employment levels, or the maintenance of proper industrial standards. Further, it was noted that terminating the Agreement will enable Cathay Pacific to achieve greater operational efficiency and decrease administrative burden and costs by removing industrial instruments from its compliance and human resources systems which no longer apply to any of its employees. Cathay Pacific is conducting a company review of historical agreements which no longer apply to any employees in order to streamline its operations, and termination of the Agreement would assist in achieving this objective.
Mr Bennett stated that terminating the Agreement will not have any impact on any current or future employees and is appropriate in the circumstances outlined above.
Based on the declaration and submissions of Mr Bennett, I am satisfied that the Agreement does not, and is not likely to, cover any employees, and that the requirement of s.226(1)(b) is therefore met.
I am satisfied that it is appropriate in all the circumstances to terminate the Agreement, and I do so. The termination will operate from 14 August 2023.
I Order accordingly.
COMMISSIONER
[1] [2022] FWC 805.
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