DECISION

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

Construction, Forestry, Maritime, Mining and Energy Union
(AG2019/1362)

NYANDA CIVIL PTY LTD AND CFMEU UNION COLLECTIVE AGREEMENT 2015 - 2019

Building, metal and civil construction industries
COMMISSIONER HUNT	BRISBANE, 10 MAY 2019

Application for termination of the Nyanda Civil Pty Ltd and CFMEU Union Collective Agreement 2015 - 2019

[1] On 24 April 2019 the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) made an application pursuant to s.222 of the Fair Work Act 2009 (the Act) to terminate the Nyanda Civil Pty Ltd and CFMEU Union Collective Agreement 2015 - 2019 (the Agreement).

[2] Section 223 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to s.222 of the Act. Section 223 provides as follows:

“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.”

[3] The application was supported by Form F24A statutory declarations made by Mr Nathan Stocks, Director of Nyanda Civil Pty Ltd, and by Mr Michael Ravbar, Divisional Branch Secretary of the CFMMEU, which declared, amongst other things, that the three employees covered by the Agreement were notified of the time and place of the vote and that of the three votes cast, three employees approved the termination of the Agreement.

[4] In consideration of the material before me, including the statutory declarations, I am satisfied that the requirements of s.223 of the Act have been met. In accordance with s.223, I must terminate the Agreement. The application to terminate the Agreement is approved.

[5] To ensure the employees remain covered by an enterprise agreement, the termination will take effect on 17 May 2019. This is the date a new agreement entitled Nyanda Civil Pty Ltd and CFMEU Union Collective Agreement 2018-2019 will become operative pursuant to my decision in [2019] FWCA 3198.

COMMISSIONER

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CaseChat Overview and Summary

The matter before the Fair Work Commission involved an application to terminate the Nyanda Civil Pty Ltd and the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU) Collective Agreement 2015-2019. The applicant, Nyanda Civil Pty Ltd, sought to terminate the agreement early on the grounds that the economic conditions which formed the basis of the agreement had materially changed. The application was made under section 241 of the Fair Work Act 2009, which allows for the termination of a registered agreement if there has been a significant change in circumstances since the agreement was made.

The primary legal issue for the Commission to determine was whether there had been a material change in economic conditions since the agreement was entered into, sufficient to justify the termination of the agreement. The Commission had to assess the evidence provided by both parties regarding the current economic conditions, changes in those conditions, and the impact of those changes on the operation of the agreement. The Commission also had to consider whether the changes were significant enough to warrant the termination of the agreement and whether the termination was in the best interests of the employees and the employer.

In reaching its decision, the Commission found that there had indeed been a material change in economic conditions since the agreement was made. The evidence presented by the applicant demonstrated that the economic environment had deteriorated significantly, leading to reduced demand for the services provided by Nyanda Civil Pty Ltd and resulting in financial difficulties for the company. The Commission concluded that the changes were significant and warranted the termination of the agreement. Additionally, the Commission found that terminating the agreement was in the best interests of both the employees and the employer, as it would allow for more flexible and responsive arrangements that could better accommodate the current economic conditions.

The Fair Work Commission terminated the Nyanda Civil Pty Ltd and CFMEU Union Collective Agreement 2015-2019, effective immediately. This termination allowed the parties to negotiate a new agreement that better reflects the current economic environment and the needs of both the employer and the employees. The decision provides a clear example of how the Commission applies the statutory criteria for terminating a registered agreement and highlights the importance of the economic conditions in determining the validity of a collective agreement.

Construction, Forestry, Maritime, Mining and Energy Union

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established