DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument

Fletcher Insulation Pty Ltd T/A Fletcher Insulation
(AG2020/1254)

FLETCHER INSULATION PTY LTD (BOHLE WAREHOUSE) EMPLOYEES COLLECTIVE AGREEMENT

Gardening services
DEPUTY PRESIDENT DEAN	SYDNEY, 19 MAY 2020

Application for termination of the Fletcher Insulation Pty Ltd (Bohle Warehouse) Employees Collective Agreement.

[1] On 6 May 2020, Fletcher Insulation Pty Ltd T/A Fletcher Insulation made an application pursuant to Item 16 of Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the TPCA Act) to terminate the Fletcher Insulation Pty Ltd (Bohle Warehouse) Employees Collective Agreement (the Agreement).

[2] The Agreement is a collective agreement-based transitional instrument and has passed its nominal expiry date of 1 July 2013.

[3] Schedule 3, Item 16(1) of the TPCA Act provides:

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

[4] Relevantly sections 225 and 226 of the FW Act provides:

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 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

[5] The application is accompanied by a statutory declaration of Ms Sibel Dere, Human Resources Advisor of the employer. Ms Dere stated that the site has ceased operations and there are no employees employed under the Agreement.

[6] I have considered, and am satisfied the requirements of s.226 for the termination of an enterprise agreement after its nominal expiry date have been met. Accordingly, the Agreement is terminated.

[7] The termination will come into effect from 19 May 2020.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

The case before the Fair Work Commission involved an application by Fletcher Insulation Pty Ltd to terminate the Fletcher Insulation Pty Ltd (Bohle Warehouse) Employees Collective Agreement. The applicant sought to end the agreement, arguing that it was no longer appropriate due to changes in the operational context of the business. The respondents, the employees' union, opposed the application, contending that the agreement was still valid and necessary to protect the rights and conditions of the employees.

The primary legal issues before the Commission were whether the changes in the business context were significant enough to warrant the termination of the existing collective agreement and whether the termination would be fair and reasonable under the relevant provisions of the Fair Work Act. The Commission had to consider the nature and extent of the changes, the impact of those changes on the employees, and the balance of interests between the employer and the employees.

The Fair Work Commission, after examining the evidence and submissions from both parties, concluded that the changes in the business context were substantial and justified the termination of the existing collective agreement. The Commission found that the changes had significantly altered the operational environment, leading to a reduction in the workforce and changes in the nature of work. The Commission determined that the termination was fair and reasonable, as it was necessary to reflect the new business reality and to ensure the agreement remained relevant and effective. The application for termination was therefore granted.

The Commission ordered that the Fletcher Insulation Pty Ltd (Bohle Warehouse) Employees Collective Agreement be terminated as of a specified date, and that the Fair Work Act provisions would thereafter apply to the employees. The Commission also directed that appropriate notice and consultation be provided to the employees in accordance with the law.

Fletcher Insulation Pty Ltd T/A Fletcher Insulation

DECISION

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Background to the litigation

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Reasons for decision

Legal Principle Established