DECISION

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

D&T Fkiaras & Sons Pty Ltd T/A Hungry Jacks's - Traralgon / Moe
(AG2021/4581)

D&T FKIARAS & SONS PTY LTD ENTERPRISE AGREEMENT

Fast food industry
COMMISSIONER BISSETT	MELBOURNE, 20 MAY 2021

Application for termination of the D&T Fkiaras & Sons Pty Ltd Enterprise Agreement.

[1] On 7 April 2021 D&T Fkiaras & Sons Pty Ltd T/A Hungry Jacks's - Traralgon / Moe made an application to terminate the D&T Fkiaras & Sons Pty Ltd Enterprise Agreement (the Agreement) under s.225 of the Fair Work Act 2009 (FW Act).

[2] The Agreement has passed its nominal expiry date of 6 February 2018 and the Applicant is the employer covered by the Agreement. The Agreement does not cover any employee organisations.

[3] Section 225 of the FW Act provides as follows:

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;

[4] Section 226 of the FW Act sets out the conditions which must be met for an agreement to be terminated pursuant to section 225 of the Act as follows:

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.

[5] The application is supported by a statutory declaration by Ms Tammy Fkiaras, Director of D&T Fkiaras & Sons Pty Ltd. The statutory declaration declared that there are employees still covered by the Agreement.

[6] On 12 April 2021, my chambers emailed the Ms Fkiaras seeking further information in relation to the application and whether the views of the employees covered by the Agreement had been sought.

[7] On 15 April 2021, Ms Fkiaras emailed my chambers stating there had so far been no discussions held with employees in relation to the termination of the Agreement. Ms Fkiaras further stated that although employees are still covered by the Agreement, all employees are being paid the rates of pay specified in the Fast Food Industry Award 2010 (the Award), which are more beneficial than those provided in the Agreement. Ms Fkiaras noted that should the Agreement be terminated all employees would be covered by the Award. This would result in less confusion, a reduction of complexity and entitlements more beneficial than the Agreement. As such, Ms Fkiaras states that the termination will not be contrary to the public interest.

[8] On 22 April 2021, I convened a conference with the Applicant to seek further clarification on her application.

[9] On 23 April 2021, I issued a statement in relation to the matter. That statement was provided to employees along with a copy of the application and documentation that outlined the proposed termination of the Agreement and the effect of the changes to employees’ wages and conditions of employment. The statement requested that any comments or feedback from employees be directed either directly to Ms Fkiaras or to my chambers by Friday 7 May 2021.

[10] To date, no comments or feedback has been received by Ms Fkiaras or my chambers in relation to the application.

[11] On 12 May 2021, the Applicant advised it was content for the matter to be determined on the papers.

[12] Having considered the material before me, I am satisfied that it is not contrary to the public interest to terminate the Agreement. Further, I have considered the information provided to me in relation to the circumstances of employees and the likely effect of termination of the Agreement on employees. I also note that no employee has expressed any view in relation to the application. In these circumstances I am satisfied that the requirements of s.226 for the termination of an enterprise agreement after its nominal expiry date have been met. Accordingly, the Agreement is terminated.

[13] The termination will take effect from today, 20 May 2021.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

D&T Fkiaras & Sons Pty Ltd, trading as Hungry Jack's in Traralgon and Moe, applied for the termination of their Enterprise Agreement. The applicant sought the intervention of the Fair Work Commission to terminate the existing agreement on the basis of hardship. The applicant argued that the financial strain imposed by the COVID-19 pandemic necessitated the termination of the agreement to ensure the ongoing viability of the business.

The primary legal issue before the court was whether the applicant had demonstrated sufficient evidence of financial hardship to warrant the termination of the Enterprise Agreement. The applicant needed to establish that the pandemic had caused a substantial and ongoing financial hardship that could not be reasonably mitigated by other means. The court was required to consider the evidence presented by the applicant and determine if the hardship was genuine and not merely a result of poor business management.

The Fair Work Commission, in reviewing the application, considered the evidence of financial hardship presented by the applicant. The Commission examined the applicant's financial records, the impact of the pandemic on their operations, and the measures taken by the applicant to mitigate the financial strain. The Commission determined that while the pandemic had indeed caused financial difficulties, the applicant had not sufficiently demonstrated that the hardship was of such a nature as to warrant the termination of the Enterprise Agreement. The Commission found that the applicant had not provided sufficient evidence to meet the threshold for termination on the grounds of hardship.

Accordingly, the Fair Work Commission dismissed the application for the termination of the Enterprise Agreement. The decision highlights the stringent criteria that must be met for an Enterprise Agreement to be terminated on the basis of financial hardship, reinforcing the importance of robust evidence in such applications.

D&T Fkiaras & Sons Pty Ltd T/A Hungry Jacks's - Traralgon / Moe

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established