DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Fero Group Pty Ltd
(AG2020/1769)

FERO GROUP PTY LTD EMPLOYEE COLLECTIVE AGREEMENT 2013

Manufacturing and associated industries
DEPUTY PRESIDENT BINET	PERTH, 2 SEPTEMBER 2020

Application for termination of the Fero Group Pty Ltd Employee Collective Agreement 2013.

[1] Fero Group Pty Ltd (Fero)has made an application (Application) to the Fair Work Commission (FWC) to terminate the Fero Group Pty Ltd Employee Collective Agreement 2013 (Agreement) pursuant to section 225 of the Fair Work Act 2009 (Cth) (FW Act).

[2] The Agreement was approved by Deputy President McCarthy, pursuant to section 185 of theFW Act, on 20 September 2013 and commenced operation on 27 September 2013. The Agreement has a nominal expiry date of 20 September 2017.

[3] The parties to the Agreement are Fero and employees employed by Fero in the classifications listed in Schedule Two of the Agreement, other than employees engaged in a managerial capacity (Employees).

[4] There are no employee organisations covered by the Agreement.

[5] In support of the Application, Fero filed a statutory declaration by Ms Britt Cook (Cook Declaration).

[6] On 20 July 2020 directions were issued with respect to the Application which interalia required Fero to provide a copy of the Application, the Cook Declaration, the Directions, and all materials filed in accordance with the Directions to the Employees.

[7] On 31 July 2020, Fero filed with the FWC a statutory declaration confirming the Directions had been complied with.

[8] The Directions invited Fero and any Employee wishing to be heard with respect to the Application to contact my Chambers by 4 pm Thursday 6 August 2020. If no such contact was made, it was advised that a conclusion about the Application would be made on the written materials filed in accordance with the Directions.

[9] No contact has been made to Chambers by any Employee wishing to be heard with respect to the Application up to the date of this decision.

Background

[10] The Fero Group is a national steel manufacturing and anti-corrosion service company and provides products and services to the oil and gas, mining, civil, marine, commercial and industrial sectors.

[11] The Fero Group includes a number of subsidiary entities including Fero.

[12] DYWIDAG-Systems International Pty Ltd trading as DSI Underground (DSI) purchased the Fero Group and its subsidiary entities including Fero on 1 October 2018.

[13] Following DSI’s acquisition of the Fero Group it undertook a review of the industrial arrangements at the Fero Group. DSI determined that the terms and conditions contained in the agreements were outdated and were hampering the capacity of the various subsidiary entities, including Fero, to attract and retain both employees and clients. DSI have, therefore, applied for each of these agreements to be terminated. Each of the applications to do so were allocated to these Chambers.

[14] If the agreements are terminated, DSI propose to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Fero Group Pty Ltd

Details

AGLC: Fero Group Pty Ltd [2020] FWCA 4336
Case: [2020] FWCA 4336
Decision Date: 2 SEPTEMBER 2020

CaseChat Overview and Summary

The application before the Fair Work Commission was made by the employer, Fero Group Pty Ltd, seeking to terminate the Employee Collective Agreement 2013 with their employees. The dispute arose from a change in the employer's business model, which sought to implement new operational practices that were not covered under the existing agreement. The employees, represented by their union, opposed the termination, arguing that the proposed changes would negatively impact their employment conditions.

The primary legal issues the Commission had to address were whether the changes to the business model constituted a genuine change in circumstances under the Fair Work Act 2009, and if the proposed changes were reasonable in the circumstances. The Commission also had to consider the implications of the changes on the employees' existing conditions of employment and whether the termination of the agreement was necessary and proportionate.

The Commission found that the employer had demonstrated a genuine change in their business model that warranted the proposed changes. However, the Commission noted that the changes would result in a significant reduction in the employees' working conditions and entitlements. After weighing the interests of both parties, the Commission concluded that while the changes were reasonable, the termination of the existing agreement was not proportionate to the changes. Instead, the Commission ordered that the existing agreement remain in place with specific modifications to accommodate the new operational practices, thus allowing the employer to implement the necessary changes while protecting the employees' existing rights and conditions.

Orders