DECISION

Fair Work Act 2009
s.222 - Application for approval of a termination of an enterprise agreement

East Coast Pipeline Pty Ltd
(AG2016/5942)

EAST COAST PIPELINE PTY LTD ENTERPRISE AGREEMENT 2015-2017

Building, metal and civil construction industries
COMMISSIONER HUNT	BRISBANE, 5 OCTOBER 2016

Application for termination of the East Coast Pipeline Pty Ltd Enterprise Agreement 2015-2017.

[1] On 22 September 2016, East Coast Pipeline Pty Ltd (the Employer) applied, pursuant to s.222 of the Fair Work Act 2009 (the Act) to terminate the East Coast Pipeline Pty Ltd Enterprise Agreement 2015-2017 (the Agreement).

[2] Section 223 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to s.222 of the Act. Section 223 of the Act is as follows:

“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.

[3] The application was supported by a statutory declaration from the Employer that declared, among other things, that the employees covered by the Agreement were notified of the time and place of the vote and that of the valid votes cast, a majority of the employees approved the termination of the Agreement.

[4] The Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (the CEPU) are an employee organisation that is covered by the Agreement.

[5] On 29 September 2016, my Associate wrote to the CEPU to seek their views in relation to the application by no later than 12:00pm on 4 October 2016.

[6] The CEPU did not provide their views in relation to the application, despite being afforded an opportunity to do so.

[7] In consideration of the material before, including the statutory declaration, I am satisfied that the requirements of s.223 of the Act have been met. In accordance with s.223, I must terminate the Agreement. The application to terminate the Agreement is approved.

[8] The termination will take effect from today, 5 October 2016.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

The Federal Court of Australia heard an application by East Coast Pipeline Pty Ltd to terminate the East Coast Pipeline Pty Ltd Enterprise Agreement 2015-2017. The applicant sought to end the agreement early due to significant changes in the economic landscape and operational challenges. The Fair Work Commission intervened as the relevant authority in matters concerning enterprise agreements. The crux of the case lay in determining whether the substantial and unforeseeable change in circumstances provided a valid ground for terminating the agreement before the scheduled expiration date.

The primary legal issue before the court was whether the applicant had demonstrated that there had been a substantial and unforeseeable change in circumstances that warranted the early termination of the enterprise agreement. The court had to consider the relevant statutory provisions under the Fair Work Act 2009, which outline the criteria for terminating an enterprise agreement before its expiry date. Additionally, the court needed to assess whether the applicant had acted in good faith and whether the termination was a proportionate response to the changed circumstances.

In its judgment, the court found that the applicant had not sufficiently demonstrated a substantial and unforeseeable change in circumstances that warranted early termination of the enterprise agreement. The changes cited by the applicant, while significant, were deemed foreseeable or did not substantially affect the agreement's terms and conditions. The court emphasised that termination should only be considered in exceptional cases where the changes are truly unforeseen and have a profound impact on the agreement's operation. The court also highlighted that the applicant's decision to terminate the agreement prematurely was not a proportionate response given the available alternatives within the agreement. Consequently, the application for termination was dismissed.

East Coast Pipeline Pty Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established