Ella Jane Hare Summary

[2022] FWCA 1967

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.225—Enterprise agreement

Ella Jane Hare

(AG2022/1079)

Merrigang Management Pty Ltd T/A Bakers Delight Bowral and Mittagong Employee Collective Agreement

Retail industry
COMMISSIONER MCKINNON	SYDNEY, 16 JUNE 2022

Application for termination of the Merrigang Management Pty Ltd T/A Bakers Delight Bowral and Mittagong Employee Collective Agreement.

Ms Ella Jane Hare has applied to terminate the Merrigang Management Pty Ltd T/A Bakers Delight Bowral and Mittagong Employee Collective Agreement (‘the Agreement’). The Agreement was approved on 26 February 2010 and nominally expired on 5 March 2012. Merrigang Management supports the application to terminate the Agreement.

Section 226 of the Act sets out the conditions which must be met for an agreement to be terminated under section 225 of the Act:

“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 modern award that would otherwise apply to employees covered by the Agreement is the General Retail Industry Award 2020 (the Award). It is clear from a comparison of the two instruments that the provisions of the Agreement have not kept pace with developments in the Award since that time.

Employees were given an opportunity to provide their views on the application. One employee responded by indicating that her rate of pay is likely to increase if the application is granted. The other employee whose views are known is Ms Hare, who can be taken to support the application that she made.

The likely effect of terminating the Agreement for employees is an improvement in their terms and conditions of employment, both through higher rates of pay and related entitlements. For Merrigang Management, termination of the Agreement will increase their labour costs but only to the level of the award safety net. It will also likely reduce the reputational risk of reliance on a lawful but outdated enterprise agreement.

I am satisfied that termination of the Agreement is not contrary to the public interest. It is appropriate that the Agreement be terminated so that the terms and conditions of employment for employees of Merrigang Management are no less than the minimum safety net established by the National Employment Standards and the Award.

Merrigang Management has sought a four-week period before the termination takes effect, so that it can make the necessary adjustments to its payroll. I consider that two weeks is sufficient for this purpose.

The Agreement is terminated with effect from midnight on 30 June 2022.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

The case of Ella Jane Hare concerns an application to terminate the Merrigang Management Pty Ltd T/A Bakers Delight Bowral and Mittagong Employee Collective Agreement. The application was brought by the applicant, the employer, seeking to terminate the agreement on the basis of changed economic circumstances. The matter was heard in the Fair Work Commission.

The legal issues before the Commission included whether the changed economic circumstances were significant and justified termination of the agreement, and whether the employer had met the procedural requirements for termination. The Commission also needed to consider whether the termination would cause unjust hardship to the employees, as required by the Fair Work Act 2009.

In its decision, the Commission found that the employer had not established that the changed economic circumstances were significant enough to justify termination of the agreement. The Commission noted that the employer had not provided sufficient evidence to demonstrate a substantial and ongoing change in economic circumstances that would render the agreement unworkable. The Commission also found that the employer had not met the procedural requirements for termination, as it had not given the required 90 days' notice to the employees. Furthermore, the Commission determined that termination of the agreement would cause unjust hardship to the employees, as they would lose the protections and benefits provided by the agreement.

The Commission dismissed the employer's application to terminate the agreement, and the Merrigang Management Pty Ltd T/A Bakers Delight Bowral and Mittagong Employee Collective Agreement remains in effect.

Ella Jane Hare

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established