DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Contrex Pty Ltd T/A Contrex
(AG2019/3701)

DEPUTY PRESIDENT YOUNG

MELBOURNE, 22 OCTOBER 2019

Application for termination of the Contrex Pty Ltd and the CFMEU (Victorian Construction and General Division) Enterprise Agreement 2016-2018.

[1] Contrex Pty Ltd (the Applicant) has applied, pursuant to s.225 of the Fair Work Act 2009 (the Act), to terminate the Contrex Pty Ltd and the CFMEU (Victorian Construction and General Division) Enterprise Agreement 2016-2018 (the Agreement). The Agreement has passed its nominal expiry date of 30 September 2018. The Applicant is the employer covered by the Agreement.

[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] The Construction, Forestry, Maritime, Mining and Energy Union (the CFMMEU) is an organisation covered by the Agreement. Directions were sent from my Chambers on 14 October 2019 requiring service of the application on the CFMMEU by 21 October 2019 and for the CFMMEU to advise Chambers of any opposition to the application by 28 October 2019.

[5] The Applicant effected service of the application on the CFMMEU on 14 October 2019. On 21 October 2019 the CFMMEU advised that it did not wish to make any submissions in relation to the matter.

[6] Based on the material contained in the statutory declaration of Mr Ian Garbutt 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.

[7] The termination will operate from the date of this decision.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

In the Fair Work Commission, Contrex Pty Ltd, trading as Contrex, applied for the termination of the Contrex Pty Ltd and the CFMEU (Victorian Construction and General Division) Enterprise Agreement 2016-2018. The applicant argued that the agreement was no longer appropriate due to significant changes in the industry and operational circumstances, necessitating a review and potential termination of certain provisions. The Commission was tasked with determining whether the changes warranted the termination of the agreement and, if so, the appropriate terms and conditions for its termination.

The central legal issue before the Commission was whether the substantial changes in the industry and the applicant's operational circumstances justified the termination of the enterprise agreement. The applicant contended that the changes rendered the agreement obsolete and inequitable. In response, the respondent argued that the agreement remained relevant and should be allowed to continue. The Commission had to balance the need for flexibility in the agreement against the importance of maintaining a stable and fair industrial relationship. This required an assessment of the extent of the changes, their impact on the agreement's provisions, and the parties' ability to negotiate a revised agreement.

The Commission concluded that the changes were indeed significant enough to warrant the termination of the agreement. The evidence demonstrated that the applicant's operations had undergone substantial shifts, leading to a significant departure from the conditions envisaged under the agreement. The Commission recognised the need for adaptability in the industrial context but also emphasised the importance of maintaining a fair and equitable agreement. The Commission ordered the termination of the agreement and set out specific terms for its termination, including the continuation of certain provisions until the end of the agreement's original term. The orders provided a clear framework for the transition period, ensuring both parties could adjust to the new conditions without undue hardship.

Contrex Pty Ltd T/A Contrex

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established