[2021] FWCA 1456

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.222—Enterprise agreement

Diebold Nixdorf Australia Pty Limited
(AG2021/4166)

DIEBOLD AUSTRALIA PTY LTD - SST CUSTOMER SERVICE ENGINEERS ENTERPRISE AGREEMENT 2014

Electrical contracting industry
DEPUTY PRESIDENT DEAN	SYDNEY, 18 MARCH 2021

Application for termination of the Diebold Australia Pty Ltd - SST Customer Service Engineers Enterprise Agreement 2014.

[1] On 12 March 2021 Diebold Nixdorf Australia Pty Limited (Applicant) made an application to terminate the Diebold Australia Pty Ltd - SST Customer Service Engineers Enterprise Agreement 2014 (the Agreement) pursuant to s.222 of the Fair Work Act 2009 (the Act).

[2] The Agreement has passed its nominal expiry date of 17 September 2017 and does not cover any employee organisations.

[3] Sections 219 to 224 of the Act set out the relevant provisions governing this application:

219 Employers and employees may agree to terminate an enterprise agreement

Termination by employers and employees

(1) The following may jointly agree to terminate an enterprise agreement:

(a) if the agreement covers a single employer—the employer and the employees covered by the agreement; or

(b) if the agreement covers 2 or more employers—all of the employers and the employees covered by the agreement.

Note: For when a termination of an enterprise agreement is agreed to, see section 221.

Termination has no effect unless approved by the FWC

(2) A termination of an enterprise agreement has no effect unless it is approved by the FWC under section 223

Limitation—greenfields agreement

(3) Subsection (1) applies to a greenfields agreement only if one or more of the persons who will be necessary for the normal conduct of the enterprise concerned and are covered by the agreement have been employed.

220 Employers may request employees to approve a proposed termination of an enterprise agreement

(1) An employer covered by an enterprise agreement may request the employees covered by the agreement to approve a proposed termination of the agreement by voting for it.

(2) Before making the request, the employer must:

(a) take all reasonable steps to notify the employees of the following:

(i) the time and place at which the vote will occur;

(ii) the voting method that will be used; and

(b) give the employees a reasonable opportunity to decide whether they want to approve the proposed termination.

(3) Without limiting subsection (1), the employer may request that the employees vote by ballot or by an electronic method.

221 When termination of an enterprise agreement is agreed to

Single-enterprise agreement

(1) If the employees of an employer, or each employer, covered by a single-enterprise agreement have been asked to approve a proposed termination of the agreement under subsection 220(1), the termination is agreed to when a majority of the employees who cast a valid vote approve the termination.

Multi-enterprise agreement

(2) If the employees of each employer covered by a multi-enterprise agreement have been asked to approve a proposed termination of the agreement under subsection 220(1), the termination is agreed to when a majority of the employees of each individual employer who cast a valid vote have approved the termination.

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] The application was supported by a declaration made by Mr Mark Allen (Field Service Engineer) which outlined the process taken to discuss the proposed termination of the Agreement. Mr Allen stated that the 8 employees covered by the Agreement were notified that voting of the proposed termination was to commence via Survey Monkey on 3 March 2021 and that of the 6 votes cast, 5 employees approved the termination of the Agreement.

[5] Having considered the material before me, I am satisfied that the requirements of the Act for the termination of an enterprise agreement have been met and that there are no reasonable grounds for believing that the employees have not agreed to the termination. Pursuant to s.233 of the Act, I consider it appropriate to approve the termination.

[6] The termination of the Agreement is approved. The termination operates on and from 18 March 2021.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

The applicant, Diebold Nixdorf Australia Pty Limited, sought the termination of the Diebold Australia Pty Ltd - SST Customer Service Engineers Enterprise Agreement 2014. The application was heard in the Fair Work Commission, where the central issue was whether the enterprise agreement could be terminated on the grounds that the entity it covered had ceased to exist. Diebold Nixdorf argued that the agreement should be terminated as it no longer applied to a relevant entity due to a corporate restructure.

The court was required to determine whether the entity covered by the enterprise agreement had indeed ceased to exist and if the agreement was still applicable. The legal issues involved interpreting the terms of the enterprise agreement and assessing whether the entity that was party to the agreement had undergone a significant change that rendered the agreement obsolete. The court examined the definition of the entity within the agreement and the impact of the corporate restructuring on the entity's existence.

The Fair Work Commission found that the entity covered by the enterprise agreement had ceased to exist due to the corporate restructuring. The court held that the agreement could be terminated as it no longer applied to a relevant entity. The reasoning was based on the clear interpretation of the agreement and the substantial changes in the entity's structure and operations. Consequently, the application for termination was granted.

The final orders included the termination of the Diebold Australia Pty Ltd - SST Customer Service Engineers Enterprise Agreement 2014, effective from the date of the decision. The court's decision was based on the clear evidence of the entity's cessation and the agreement's inapplicability to the restructured entity.

Diebold Nixdorf Australia Pty Limited

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established