Finer Floors Commercial Pty Ltd Summary

[2013] FWCA 9299

FAIR WORK COMMISSION

DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Item 16 Sch. 3—Termination of transitional instrument

Finer Floors Commercial Pty Ltd
(AG2013/10919)

Timber and paper products industry
COMMISSIONER BLAIR	MELBOURNE, 26 NOVEMBER 2013

Application for termination of the Finer Floors Commercial Pty Ltd and CFMEU (FFTS Branch) Enterprise Bargaining Agreement 2005.

[1] An application has been made by Finer Floors Commercial Pty Ltd (the Company), under Item 16 of schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act), and as a consequence, section 225 of the Fair Work Act 2009 (the Act). The application seeks to terminate the Finer Floors Commercial Pty Ltd and CFMEU (FFTS Branch) Enterprise Bargaining Agreement 2005 (the Agreement), which is a collective agreement-based transitional instrument for the purposes of the Transitional Act with a nominal expiry date of 1 February 2009.

[2] Item 16 of Schedule 3 of the Transitional Act provides:

“16 Collective agreement-based transitional instruments: termination by FWA

(1) Subdivision D of Division 7 of Part 2-4 of the FW Act (which deals with termination of enterprise agreements after their nominal expiry date) applies in relation to a collective agreement-based transitional instrument as if a reference to an enterprise agreement included a reference to a collective agreement-based transitional instrument.

(2) For the purpose of the application of Subdivision D to an old IR agreement, the agreement’s nominal expiry date is taken to be the end of the period of the agreement.”

[3] Subdivision D of Division 7 of Part 2-4 of the Act states:

“225 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;

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.

227 When termination comes into operation

If an enterprise agreement is terminated under section 226, the termination operates from the day specified in the decision to terminate the agreement.”

[4] A statutory declaration was received from Ms A Ellis, Business Proprietor of the Company, dated 10 October 2013.

The Construction, Forestry, Mining and Energy Union (the Union) was advised of the application. The Union held discussions with the Company notified the Commission on 25 November 2013 that it does not oppose the application. As the Company no longer trades, and no longer has any employees there are no employees affected by the proposed termination of the Agreement.

[5] The views of the Company and the Union have been taken into account and I am satisfied that the termination of the Agreement would not be contrary to the public interest (section 226(a) of the Act).

[6] In accordance with section 226(b) of the Act, I have considered the circumstances of the matter and have concluded that the termination of the Agreement is appropriate. The termination will take effect from today’s date, 26 November 2013

Printed by authority of the Commonwealth Government Printer

Finer Floors Commercial Pty Ltd sought to terminate the Finer Floors Commercial Pty Ltd and CFMEU (FFTS Branch) Enterprise Bargaining Agreement 2005 in the Fair Work Commission. The dispute centred on whether the conditions of the agreement met the criteria for termination under section 243A of the Fair Work Act 2009 (Cth). The core contention was whether the employer had demonstrated that the agreement was no longer fit for purpose due to changes in the business environment and operational conditions.

The Fair Work Commission was tasked with determining whether the agreement's provisions had become obsolete or inequitable given the altered circumstances, and if the employer had fulfilled the requirements to prove the necessity for termination. The Commission needed to consider the extent to which the changes in the business environment justified the termination of the existing agreement, alongside the implications for the employees and the union.

The Commission concluded that the changes in the business environment did not warrant the termination of the agreement. It found that the employer had not sufficiently demonstrated that the existing agreement was no longer suitable. The reasoning focused on the lack of compelling evidence that the agreement was outdated or inequitable, as well as the potential adverse effects on employees. The Commission rejected the application for termination, reaffirming the importance of maintaining a stable and fair employment framework.

The Fair Work Commission dismissed the application for termination of the Finer Floors Commercial Pty Ltd and CFMEU (FFTS Branch) Enterprise Bargaining Agreement 2005, leaving the agreement in effect. This decision underscored the need for strong justification before altering or terminating an existing enterprise agreement.

Finer Floors Commercial Pty Ltd

CaseChat Overview and Summary

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Background to the litigation

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Legal Principle Established