Dorsett Retail Pty Ltd T/A Retravision
[2022] FWCA 4139
•2 DECEMBER 2022
| [2022] FWCA 4139 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.225—Enterprise agreement
Dorsett Retail Pty Ltd T/A Retravision
(AG2022/4757)
DORSETT RETAIL PTY LTD COLLECTIVE EMPLOYMENT AGREEMENT
| Retail industry | |
| DEPUTY PRESIDENT BEAUMONT | PERTH, 2 DECEMBER 2022 |
Application for termination of the DORSETT RETAIL PTY LTD COLLECTIVE EMPLOYMENT AGREEMENT
This decision concerns an application by Dorsett Retail Pty Ltd (the Applicant) for the termination of the Dorsett Retail Collective Employment Agreement (the Agreement),[1] under s 225 of the Fair Work Act 2009 (the Act). The Agreement has a nominal expiry date of 28 August 2014.
Section 225 of the Act allows an employer to apply to the Commission for the termination of an agreement that has passed its nominal expiry date.
Section 226 of the Act, set out below, details the considerations for the Commission when dealing with such an application.
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.
The Applicant held no objection to the application being determined on the papers and I considered it the appropriate course to take.
In support of its application, the Applicant provided a statutory declaration from Karen Edwards, its Chief Operations Officer (COO).
The Applicant provided background to the application to terminate the Agreement in the statutory declaration of the COO. That background is as follows.
Background to the application
At the time the application was made, 11 out of the Applicant’s 162 employees were covered by the Agreement and it applied to them in their employment (impacted employees). The primary activity of the Applicant is retail, with its focus on electrical, white goods, furniture, and household items.[2]
These impacted employees were asked to vote on whether they were comfortable with the termination of the Agreement.[3] According to the COO, two chose not to vote.[4] The COO explained that each impacted employee was offered the opportunity to discuss any concerns or questions they may have around terminating the Agreement prior to the Applicant making the application.[5]
The Applicant now seeks to apply the General Retail Industry Award 2020[6] (Award) as a minimum safety net for the impacted employees. The COO stated that Agreement refers to the Shop & Warehouse (Wholesale and Retail Establishments) Award 1977. However, the Applicant has been paying the impacted employees under the Award for some time so that they are not disadvantaged.[7] The COO further noted that the Agreement was no longer aligned to its current practices,[8] having been underpinned by what was an award under the state industrial relations system.
In support of its application, the Applicant provided the voting slips of impacted employees, a table comparing the terms of the Agreement and Award, feedback from one of the impacted employees and the template contracts to be offered to impacted employees. Insofar as the feedback was concerned, the impacted employee in question detailed that she had been taken through the comparison table and considered the termination long overdue.
Additionally, the Applicant has given an undertaking ensuring employees will receive no less than the minimum amounts payable under the terms of the Agreement and the Award.
Consideration
I am satisfied the requirements of s 225 of the Act are met. The Agreement has passed its nominal expiry date, and pursuant to s 225(a), the COO declared the Applicant is the employer covered by the Agreement. As such, the Applicant has standing to bring the application under s 225(a) of the Act.
2.1 Section 226(a) of the Act – Not contrary to the public interest
Attention first turns to whether the termination of the Agreement is ‘not contrary to the public interest’.
The ‘public interest’ refers to matters that might affect the public, such as the achievement or otherwise of the object of the Act, employment levels, inflation, and the maintenance of proper industrial standards.[9] It is distinct in nature from the interests of the parties, though those interests may be simultaneously affected.[10]
The object of the Act, set out in s 3, is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians. The object is to be achieved by, among other things, ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions, and by achieving productivity and fairness through an emphasis on enterprise-level collective bargaining. Section 578 requires that in performing functions or exercising powers, the Commission must take this object into account.
It is also relevant to highlight that the Full Bench in Re Aurizon Operations Ltd (Aurizon) concluded that it cannot be expected that the terms and conditions of an agreement will continue unaltered in perpetuity after it has passed its expiry date.[11] This is because the Act contemplates the terms and conditions of an agreement may be altered by making a new agreement or by terminating the existing agreement.
I am satisfied that the termination of the Agreement is not contrary to the public interest as it would not undermine the object of the Act, employment levels, and the maintenance of proper industrial standards.
The Agreement had passed its nominal expiry date and there is no evidence before me to suggest that bargaining is on foot in relation to a successor enterprise agreement, which would cover the impacted employees. It follows that a termination would not impact the bargaining positions of the parties.
Furthermore, if the Agreement was terminated and the Applicant engaged new employees in the positions of the impacted employees, those future employees would be covered by the Award, as will the existing ones. On this basis, the termination of the Agreement would not adversely affect the public interest in so far as the maintenance of proper industrial standards is concerned.
Based on the material contained in the declaration of the Applicant and the additional supporting materials filed, I am satisfied that the termination of the Agreement is not contrary to the public interest.
2.2 Section 226(b) of the Act – Appropriateness
The approach to assessing ‘appropriateness’ in the context of ss 226(b)(i) and (ii) of the Act was detailed by the Full Bench in Aurizon. It said:
All of the circumstances also need to be taken into account in considering whether termination of the agreements is appropriate. In particular the views of employers and employees covered by the agreement, their circumstances, and the impact of termination need to be taken into account. The requirement in s. 226(b) to take into account all of the circumstances including those set out in s. 226(b)(i) and (ii) is a requirement to take the matters into account and to give them due weight in assessing whether it is appropriate to terminate an enterprise agreement. In assessing appropriateness by taking into account all of the circumstances, we approached the task by reference to the construction of s. 226 and the contextual matters that bear upon that construction dealt with earlier as well as giving specific consideration to the matters identified in s. 226(b)(i) and (ii).[12]
I intend to adopt this approach.
The Applicant has undertaken a consultative process with its employees regarding the proposed termination and the effect that it would have on them. Those same employees have demonstrated support for the termination, albeit two opted not to vote.
As noted, the Applicant has provided the employees with an undertaking which has been reduced to writing and set out in Annexure A to this decision. Furthermore, the Applicant has acknowledged that entitlements such as accrued annual leave, personal leave, and long service leave will not be affected.
Considering all the circumstances including those in ss 226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement.
Conclusion
An Order[13] will be issued terminating the Agreement with effect on 2 December 2022.
DEPUTY PRESIDENT
Annexure A
[1] AC325969.
[2] Form F24C – Declaration in relation to termination of an enterprise agreement after the nominal expiry date (COO Declaration) [3.1]
[3] Ibid [2.1]
[4] Ibid.
[5] Ibid.
[6] MA000004.
[7] COO Declaration (n 2) [2.1].
[8] Ibid.
[9] Re Aurizon Operations Ltd (2015) 249 IR 55, 96–7 [129] (Aurizon).
[10] Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement2000 (2005) 139 IR 34, 40 [23].
[11] Aurizon (n 9) 110 [176].
[12] Ibid 107 [167].
[13] PR748489.
Printed by authority of the Commonwealth Government Printer
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