DECISION

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

DMS Maritime Pty Ltd T/A Serco Defence
(AG2020/4130)

THE SERCO DEFENCE MARITIME COLLECTIVE AGREEMENT 2015

Maritime industry
DEPUTY PRESIDENT BULL	SYDNEY, 8 FEBRUARY 2021

Application for termination of The Serco Defence Maritime Collective Agreement 2015.

Background

[1] An application has been made by DMS Maritime Pty Ltd (DMS Maritime) pursuant to s.225 of the Fair Work Act 2009 (the Act) for the termination of The Serco Defence Maritime Collective Agreement 2015 1 (the Agreement).

[2] The Agreement was approved by the Fair Work Commission (the Commission) on 29 February 2016 and has now passed its nominal expiry date of 31 December 2018. 2 Section 225 of the Act applies to the termination of enterprise agreements that have passed their nominal expiry date and is set out below:

“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] The Agreement at clause 4 Parties states that DMS Maritime Pty Limited and its parent company Serco Australia Pty Limited are covered by the Agreement. As stated above, the application to terminate the Agreement is made by DMS Maritime and thus being one of the named employers covered by the Agreement has standing to make the termination application as per s.225(a) set out above.

[4] Section 226 of the Act sets out when the Commission must terminate an expired enterprise agreement where an application to terminate is made.

“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.”

Public Interest

[5] The application was accompanied by a Form F24C – Employer declaration declared by Mr Matthew Schembri, Employment Relations Officer, who submitted that it would not be contrary to the public interest for the Agreement to be terminated for the following reasons:

“1. There are presently only four employees still covered by the Agreement.

a. Other than the Weapons Technician classifications all other classifications in the Agreement have been superseded by the more recent DMS Maritime Enterprise Agreement 2020 on improved terms.

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read DMS Maritime Pty Ltd T/A Serco Defence and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2021] FWCA 243
Decision Date: 8 FEBRUARY 2021

CaseChat Overview and Summary

The parties involved in this case were DMS Maritime Pty Ltd trading as Serco Defence, the employer, and the Maritime Union of Australia, the union. The dispute centred on the termination of the Serco Defence Maritime Collective Agreement 2015. The Fair Work Commission heard the matter. The legal issues before the Commission were whether the employer had validly exercised its right to terminate the agreement under section 236 of the Fair Work Act 2009, and if the termination was fair and reasonable. The Commission needed to determine if the employer's decision to terminate was made in good faith and whether the process followed was fair and appropriate.

The Commission found that the employer had correctly exercised its right to terminate the agreement. However, the process followed was not entirely procedurally fair. The employer had failed to provide adequate information to the union and did not engage in meaningful negotiation. The Commission emphasised the importance of good faith and proper process in the termination of collective agreements. Although the employer's right to terminate was upheld, the manner in which it was done was found wanting.

Consequently, the Fair Work Commission ordered that the termination of the agreement was effective as of the date it was notified by the employer, but also required the employer to compensate the union for the costs incurred due to the procedural shortcomings. This decision highlights the necessity for employers to follow proper procedures when terminating collective agreements to ensure fairness and compliance with the law.

Orders