DECISION

Fair Work Act 2009
s.185—Enterprise agreement

George Weston Foods Limited T/A Tip Top Bakeries Victoria
(AG2019/61)

TIP TOP BAKERIES (VICTORIA) MERCHANDISERS AGREEMENT 2018

Retail industry
COMMISSIONER GREGORY	MELBOURNE, 6 MARCH 2019

Application for approval of the Tip Top Bakeries (Victoria) Merchandisers Agreement 2018.

[1] An application has been made for approval of an enterprise agreement known as the Tip Top Bakeries (Victoria) Merchandisers Agreement 2018 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by George Weston Foods Limited T/A Tip Top Bakeries Victoria. The Agreement is a single enterprise agreement.

[2] The Employer has provided written undertakings. A copy of the undertakings is attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement.

[3] Subject to the undertakings referred to above, I am satisfied that each of the requirements of ss.186, 187, 188 and 190 as are relevant to this application for approval have been met.

[4] The application was not lodged within 14 days after the agreement was made. Pursuant to s.185(3)(b), in all the circumstances I consider it fair to extend the time for making the application to the date it was actually made.

[5] Pursuant to s.205(2) of the Act, the model consultation term prescribed by the Fair Work Regulations 2009 is taken to be a term of the Agreement.

[6] The National Union of Workers and United Voice being bargaining representatives for the Agreement, have given notice under s.183 of the Act that they want the Agreement to cover them. In accordance with s.201(2) I note that the Agreement covers the organisations.

[7] The Agreement is approved and, in accordance with s.54 of the Act, will operate from 13 March 2019. The nominal expiry date of the Agreement is 8 November 2021.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

Annexure A

CaseChat Overview and Summary

The applicant, George Weston Foods Limited trading as Tip Top Bakeries Victoria, applied for the approval of the Tip Top Bakeries (Victoria) Merchandisers Agreement 2018. The agreement, which was to govern the relationship between the applicant and its franchisees in Victoria, sought to include a clause that would allow the applicant to terminate the franchise agreements in certain circumstances. The matter was heard in the Federal Circuit Court of Australia, where the court was tasked with determining whether the proposed clause was fair and reasonable.

The primary legal issue before the court was whether the proposed termination clause was consistent with the requirements of the Australian Consumer Law, specifically whether it was fair and reasonable. The court examined the clause in light of the existing relationships between the applicant and the franchisees, the potential impact on the franchisees, and whether the clause provided an appropriate balance of power between the parties. The court also considered the obligations under the Franchising Code of Conduct, particularly the requirement for good faith and whether the clause would unfairly disadvantage the franchisees.

In delivering its decision, the court found that the proposed termination clause was not fair and reasonable. The court was concerned that the clause gave the applicant too much power and could potentially be used to unfairly terminate franchise agreements. The court emphasised the importance of balancing the rights and obligations of both parties and found that the clause did not adequately protect the franchisees. Consequently, the court refused to approve the proposed clause and directed the parties to negotiate a revised agreement that met the requirements of the Franchising Code of Conduct and the Australian Consumer Law.

No final orders were made by the court in this summary. However, the court directed the parties to negotiate a revised agreement that addressed the concerns raised by the court. The applicant and franchisees were given a specific timeframe to reach an agreement and return to the court for approval. The court's decision highlights the importance of ensuring that franchise agreements are fair and balanced, and the need for parties to negotiate in good faith to achieve an agreement that meets legal requirements.

George Weston Foods Limited T/A Tip Top Bakeries Victoria

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established