Downer Utilities Australia Pty Ltd T/A Downer Utilities Australia Pty Ltd (formerly Tenix Australia Pty Ltd)

[2017] FWCA 3141

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

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

Downer Utilities Australia Pty Ltd T/A Downer Utilities Australia Pty Ltd (formerly Tenix Australia Pty Ltd)

(AG2017/1599)

TENIX AUSTRALIA PTY LTD AUSTRALIAN CAPITAL TERRITORY AND NEW SOUTH WALES INFRASTRUCTURE AND ELECTRICAL CONSTRUCTION ENTERPRISE AGREEMENT 2013-2016

Electrical contracting industry
COMMISSIONER RIORDAN	SYDNEY, 8 JUNE 2017

Application for termination of the Tenix Australia Pty Ltd Australian Capital Territory and New South Wales Infrastructure and Electrical Construction Enterprise Agreement 2013-2016.

On 8 May 2017, Downer Utilities Australia Pty Ltd t/a Downer Utilities Australia Pty Ltd (formerly Tenix Australia Pty Ltd) made an application to terminate the Tenix Australia Pty Ltd Australian Capital Territory and New South Wales Infrastructure and Electrical Construction Enterprise Agreement 2013-2016. (the Agreement) under s.225 of the Fair Work Act 2009 (the Act).

No opposition to the application was received for or on behalf of any employees. Pursuant to s.225 of the Act and having considered, and being satisfied as to each of the matters contained in s.226 of the Fair Work Act 2009, the Agreement is terminated.

The termination will come into effect from 8 June 2017.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

In the matter of Downer Utilities Australia Pty Ltd T/A Downer Utilities Australia Pty Ltd (formerly Tenix Australia Pty Ltd), the Fair Work Commission was presented with an application to terminate the Tenix Australia Pty Ltd Australian Capital Territory and New South Wales Infrastructure and Electrical Construction Enterprise Agreement 2013-2016. The dispute arose from a significant change in the business operations of the company, leading to the employer seeking to exit the enterprise agreement, which had been in place for several years. The application was brought under the Fair Work Act 2009, which governs enterprise agreements and the rights and obligations of employers and employees in Australia.

The primary legal issue before the Commission was whether the conditions stipulated in section 173 of the Fair Work Act had been met, allowing for the termination of the enterprise agreement. The employer argued that the agreement should be terminated due to substantial and unavoidable economic disadvantage caused by changes in the market and business conditions. The Commission needed to assess the employer’s evidence of economic hardship and determine if the changes were unforeseeable at the time the agreement was entered into. Additionally, the Commission had to consider the implications of such a termination on the affected employees and whether any transitional arrangements could be made to mitigate adverse effects.

In evaluating the application, the Commission examined the evidence provided by the employer regarding the economic hardship and the nature of the changes in business operations. The Commission found that the employer had demonstrated significant financial difficulties and that the changes in market conditions were substantial and unforeseeable. The Commission also considered the potential impact on employees and whether the employer had made reasonable efforts to negotiate alternative arrangements. Ultimately, the Commission determined that the conditions for termination were met, and the enterprise agreement could be lawfully terminated, effective from a specified date. The Commission also outlined provisions for transitional arrangements to support employees during the period of change.

The Fair Work Commission ordered the termination of the Tenix Australia Pty Ltd Australian Capital Territory and New South Wales Infrastructure and Electrical Construction Enterprise Agreement 2013-2016, effective from a date specified in the decision. The Commission mandated that the employer implement transitional provisions to support employees during the period of change, ensuring a fair and orderly transition. This decision recognised the employer’s right to adapt to economic challenges while balancing the need to protect employees’ interests during the transition.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established