Ensign Services (Aust) Pty Ltd

[2017] FWCA 6804

[2017] FWCA 6804

FAIR WORK COMMISSION

DECISION

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

Ensign Services (Aust) Pty Ltd
(AG2017/5728)

ENSIGN SERVICES WORKWEAR DRIVERS AGREEMENT 2011

Road transport industry
DEPUTY PRESIDENT MILLHOUSE	MELBOURNE, 18 DECEMBER 2017

Application for termination of the Ensign Services Workwear Drivers Agreement 2011.

[1] Ensign Services (Aust) Pty Ltd (Applicant) has applied under s.225 of the Fair Work Act 2009 (Act) to terminate the Ensign Services Workwear Drivers Agreement 2011 (Agreement). The Agreement is expressed to cover the Applicant, the Transport Workers’ Union (TWU) and all Workwear drivers, who are members of, or eligible to be members of, the TWU. The Agreement has passed its nominal expiry date.

[2] The application is not opposed by the TWU and there are no employees covered by the Agreement. In the circumstances, I have decided to deal with the application on the papers without conducting a hearing.

Statutory Framework

[3] Section 225 of the Act provides:

“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;

(c) an employee organisation covered by the agreement.”

[4] Section 226 of the Act provides:

“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.”

Consideration

[5] The Applicant is a provider of managed laundry solutions and is a subsidiary of Spotless Group Holdings Limited.

[6] The Agreement reached its nominal expiry date on 19 July 2015. 1 The Applicant has standing to make the application because, pursuant to s.225(a) of the Act, it is the employer that is covered by the Agreement. Accordingly, the jurisdictional prerequisites for the making of an application under s.225 of the Act are satisfied.

Section 226(a) – not contrary to the public interest

[7] The Applicant contends, taking into account the observations of a Full Bench of the Australian Industrial Relations Commission in Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000, 2 that it is not contrary to the public interest to terminate the Agreement for the following reasons:

•  If an employee was employed by the Applicant in the future to perform work that would have otherwise been covered by the Agreement, the employee would be covered by the Road Transport and Distribution Award 2010 and the National Employment Standards. There is, therefore, a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions of employment that would apply to any such employee.

(b) By virtue of the nominal expiry date of the Agreement, it was contemplated that termination of the Agreement was a relevant possibility.

(c) Bargaining for a new enterprise agreement remains available if any employee was employed by the Applicant in the future to perform work that would have otherwise been covered by the Agreement.

(d) There is no detriment to the public by the termination of the Agreement.

[8] There is nothing before me which raises public interest considerations that might militate against termination of the Agreement. Based on the material filed with the Commission, I am satisfied that termination of the Agreement is not contrary to the public interest.

Section 226(b) – appropriate to terminate the Agreement

[9] The task required of the Fair Work Commission (Commission) under s.226(b) was considered by Deputy President Gostencnik in Allen & O'Brien Pty Ltd T/A O'Brien Electrical Services: 3

“All of the circumstances also need to be taken into account in considering whether termination of the Agreement is appropriate. In particular, the views of employers, employees and employee organisations 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, it is appropriate to approach the task by reference to the construction of s.226 and the contextual matters that bear upon that construction as well as giving specific consideration to the matters identified in s.226(b)(i) and (ii).”

(citations omitted)

[10] In respect of s.226(b)(i) of the Act, the statutory declaration 4 of Jasmeet Padam, Service and Distribution Manager for the Applicant, filed in support of the application, states that there are no employees covered by the Agreement.

[11] The Applicant wishes to terminate the Agreement as it ceased employing “Workwear drivers” under the Agreement on 30 July 2015 and the Agreement reached its nominal expiry date on 19 July 2015. The Applicant said that it has no commercial contracts to perform the work covered by the Agreement and nor is it foreseeable that it will hold such commercial contracts in the future.

[12] In correspondence provided to the Commission on 30 November 2017, the TWU advised that it does not oppose the application.

[13] In respect of s.226(b)(ii) of the Act, the Applicant contends that in these circumstances, the termination of an Agreement that covers no employees will be beneficial to the Applicant and will have no effect on any employees. Given the TWU does not oppose the application, the likely effect of any termination of the Agreement on it is a neutral consideration.

[14] Taking into account all of the circumstances, including those set out at s.226(b)(i) and (ii) and the matters set out above, I consider that it is appropriate to terminate the Agreement.

Conclusion

Given my findings in respect of ss.225 and 226(a) and (b) above, I must terminate the Agreement. The termination will operate from 18 December 2017.

DEPUTY PRESIDENT

 1   Clause 6.1 of the Agreement and [2012] FWAA 5583 at [4].

 2 (2005) 139 IR 34.

 3   [2016] FWCA 1906 at [22].

 4   Form F24C statutory declaration of Jasmeet Padam dated 22 November 2017.

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