DECISION

Fair Work Act 2009
s.210—Enterprise agreement

Fredon Industries Pty Ltd T/A Fredon
(AG2021/4995)

FREDON INDUSTRIES PTY LIMITED & ETU SYDNEY CONSTRUCTION ENTERPRISE AGREEMENT 2019

Electrical contracting industry
COMMISSIONER JOHNS	SYDNEY, 25 MAY 2021

Application for variation of the Fredon Industries Pty Limited & ETU Sydney Construction Enterprise Agreement 2019.

[1] An application has been made for approval of a variation to the Fredon Industries Pty Limited & ETU Sydney Construction Enterprise Agreement 2019 (the Agreement). The application was made by Fredon Industries Pty Ltd T/A Fredon pursuant to section 210 of the Fair Work Act 2009 (the Act).

[2] The application seeks to vary various clauses of the Agreement. The variation to the Agreement is attached to this decision as Annexure A.

[3] I am satisfied that each of the requirements of ss.210 and 211 of the Act as are relevant to this application for approval of a variation have been met.

[4] The Applicant provided written undertakings to meet concerns that particular requirements of ss.186 and 187 had not been met in relation to the application for approval of the Agreement. The undertakings were accepted and the Agreement was approved on 31 October 2019. Those undertakings form part of the Agreement as varied.

[5] Pursuant to s.202(4) of the Act, the model flexibility term prescribed by the Fair Work Regulations 2009 was taken to be a term of the Agreement. The model term forms part of the Agreement as varied.

[6] The variation is approved and the consolidated version of the Agreement, as varied, is attached to this decision.

[7] In accordance with s.216 of the Act, the variation operates from 25 May 2021.

COMMISSIONER

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CaseChat Overview and Summary

Fredon Industries Pty Ltd, trading as Fredon, sought variation of the Fredon Industries Pty Limited & ETU Sydney Construction Enterprise Agreement 2019 before the Fair Work Commission. The enterprise trade union, ETU Sydney, opposed the application. The crux of the dispute lay in Fredon's proposal to modify certain provisions of the enterprise agreement, which the union deemed detrimental to its members' conditions and entitlements. The case necessitated the Commission to adjudicate on the legitimacy of the proposed changes, their compliance with the Fair Work Act 2009, and the procedural fairness exercised in their proposal.

The legal issues before the Commission were multifaceted. Primarily, the Commission had to determine if the proposed changes by Fredon were procedurally sound and substantively fair. This involved assessing whether the application was made in good faith and whether the changes were necessary to maintain the business's operational efficiency without undermining the employees' rights. The Commission also needed to consider if the application process adhered to the statutory requirements and whether the changes proposed would result in a detriment to the employees' terms and conditions of employment.

In its decision, the Fair Work Commission found that the application by Fredon was procedurally valid but did not meet the threshold for a substantive variation. The Commission highlighted that while Fredon had demonstrated a legitimate interest in the proposed changes, the modifications did not sufficiently justify a departure from the existing enterprise agreement. The Commission emphasised the importance of maintaining a balance between the operational needs of the business and the protection of employees' rights. Consequently, the application was dismissed as the proposed changes did not align with the statutory criteria for a fair and reasonable variation.

As a result of the Commission's decision, the application for variation was denied, and the existing enterprise agreement remained in force. The Fair Work Commission's ruling underscored the necessity for employers to demonstrate a compelling justification for any proposed changes to an enterprise agreement. The decision reinforced the principle that while businesses must be allowed to adapt to changing circumstances, any such adaptations must not come at the expense of employees' established rights and conditions.

Fredon Industries Pty Ltd T/A Fredon

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established