Ginkgo Biloba Pty Ltd

[2020] FWCA 2873

[2020] FWCA 2873

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.225 - Application for termination of an enterprise agreement after its nominal expiry date

Ginkgo Biloba Pty Ltd
(AG2020/888)

GINKGO BILOBA PTY LTD AND CFMEU UNION COLLECTIVE AGREEMENT 2011-2015

Building, metal and civil construction industries
COMMISSIONER SPENCER	BRISBANE, 8 JUNE 2020

Application for the termination of the Ginkgo Biloba Pty Ltd and CFMEU union collective agreement 2011-2015.

[1] An application pursuant to s.225 of the Fair Work Act 2009 (the Act) was made by Ginkgo Biloba Pty Ltd (the Applicant) to terminate the Ginkgo Biloba Pty Ltd and CFMEU union collective agreement 2011-2015 (the Agreement).

[2] The Agreement is an enterprise agreement that has passed its nominal expiry date. The nominal expiry date for the Agreement was 31 March 2015.

[3] The Construction, Forestry, Maritime, Mining and Energy Union, being covered by the Agreement, confirmed that they did not wish to be heard in relation to this application.

[4] Further, ss.225 and 226 of the FW Act relevantly provide:

“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;

(c) an employee organisation 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] Mr Andrew Murchie, Director for the Applicant, filed a Form 24C Statutory Declaration in support of the application to terminate the Agreement. The Applicant sought the termination of the Agreement on the basis that it would allow the Company more flexibility in the terms and conditions provided to employees. The Applicant submitted that the current employment terms confined within the Agreement that is outdated no longer relevant to such a small employer.

[6] Mr Murchie submitted that the termination of the Agreement would not be contrary to public interest as the Agreement had been expired for many years and the company only employs a very small number of employees. Mr Murchie stated that the Applicant would prefer to be able to negotiate its own terms and considerations directly with its employees. It was submitted that given the small size of the both the company and the number of employees, the termination of this Agreement will have no effect on the public interest. Mr Murchie further stated that there is nothing else within his knowledge that would indicate it would be contrary to public interest to terminate the Agreement.

[7] The Applicant submitted that the termination of the Agreement will not result in a reduction of terms and conditions of the employees, rather the ability to offer them in a different way which are suitable to both the employer and employees.

[8] Mr Murchie submitted that the Building and Construction General On-Site Award 2010 (the Award) would be the relevant applicable Award if the Agreement is terminated. Mr Murchie stated that in accordance with clause 7.1 of the Award, the employer would offer the employees a different way, which is a higher hourly rate in lieu of payments currently being made to BEWT and CIPS and redundancy payment. Mr Murchie stated that the higher hourly rate would also be in lieu of the overtime and other allowances payable under the Award. Mr Murchie further stated that the hourly rate for each employee would be increased by $1.05 per hour, bringing their current rate to $46.05 per hour.

[9] Mr Murchie provided calculations based on this proposed hourly rate, demonstrating that the employee’s entitlements are the same value as what they are currently being paid, but with a higher hourly rate. This results in employees being paid an additional $98.97 above the Agreement and $476.67 above the Award, calculated over a one-week period.

[10] The Applicant submitted that the employees had been consulted and that they did not oppose the termination of the Agreement. A declaration was provided that had been signed by both of the current employees. This signed declaration stated that the employer had explained the that the current hourly rate under the Agreement is $43 per hour, which is in lieu of ordinary time, penalty rates allowances and all other payments arising from the Agreement and the Award. The document also confirmed that the employees are paid a higher hourly rate than is offered under the Agreement, as well as superannuation, BERT, BEWT and CIPS.

[11] The declaration also confirmed that the employer had explained to the employees that terminating the Agreement will mean that the terms and conditions of their employment will be covered by the Award. The declaration also confirmed that both employees do not oppose the termination of the Agreement.

[12] Taking into account the information provided in response to the matters in s.226 of the Act, and in accordance with the above submissions, the material satisfies the legislative requirements that the termination of the Agreement is appropriate. The termination will take effect from 8 June 2020.

[13] I Order accordingly.

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