DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 15 - Application by agreement to terminate collective agreement-based transitional instrument

Glasshouse Country Care Association Inc T/A Glasshouse Country Care
(AG2016/6654)

GLASSHOUSE COUNTRY CARE ASSOCIATION INC EMPLOYEE COLLECTIVE AGREEMENT 2007-2010

Health and welfare services
COMMISSIONER SIMPSON	BRISBANE, 4 NOVEMBER 2016

Application for termination of the Glasshouse Country Care Association Inc Employee Collective Agreement 2007-2010.

[1] On 26 October 2016 Glasshouse Country Care Association Inc T/A Glasshouse Country Care (the Employer) filed an application pursuant to Item 15, Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the TPCA Act)to terminate the Glasshouse Country Care Association Inc. Employee Collective Agreement (the Agreement).

[2] As the Agreement is a collective agreement-based transitional instrument (being a preserved collective State Agreement under the Workplace Relations Act 1996) which has passed its nominal expiry date, the appropriate provision under which to terminate the agreement is Item 16, Schedule 3 of the TPCA Act.

[3] Item 16, Schedule 3 of the TPCA Act states that Subdivision D of Division 7 of Part 2-4 of the FW Act applies to applications to terminate collective agreement-based transitional instruments that have passed their nominal expiry date. I am satisfied that the Agreement is a collective agreement-based transitional instruments and its nominal expiry date has passed.

[4] Section 226 of the Fair Work Act 2009 (The Act) states that:

“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] Ann McQuay, General Manager of Glasshouse Country Care Association Inc., provided a statutory declaration attesting to the process undertaken by the Employer when requesting that the Agreement be terminated.

[6] In having regard to the requirements of s.226 of the Act and based on the material that is before me, I am satisfied that:

● it is not contrary to the public interest to terminate the Agreement; and

● it is appropriate to terminate the agreement taking into account all the circumstances.

[7] In accordance with s.227 of the Act, the termination will come into effect today.

COMMISSIONER

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CaseChat Overview and Summary

Glasshouse Country Care Association Inc, trading as Glasshouse Country Care, applied to the Fair Work Commission for the termination of the Glasshouse Country Care Association Inc Employee Collective Agreement 2007-2010. The association sought the termination of the agreement on the grounds of a significant change in circumstances since the agreement was made, specifically the significant increase in operational costs and a corresponding reduction in funding. The association argued that the agreement was no longer fair and reasonable in light of these changes.

The central legal issue before the Commission was whether the significant changes in circumstances since the agreement was made justified the termination of the collective agreement. The association had to demonstrate that the changes were not reasonably foreseeable at the time of the agreement and that the agreement was no longer fair and reasonable. The Commission considered the principles of good faith bargaining and the need to maintain a fair and reasonable agreement in light of the changed circumstances.

The Fair Work Commission found that the significant changes in circumstances, including the increase in operational costs and reduction in funding, were not reasonably foreseeable at the time of the agreement. The Commission held that the agreement was no longer fair and reasonable given these changes. The Commission accepted the association's evidence and concluded that the association had acted in good faith throughout the bargaining process. The application for termination was therefore successful.

The Commission terminated the Glasshouse Country Care Association Inc Employee Collective Agreement 2007-2010, effective from the date of the decision. The Commission also directed the association and the employees to engage in good faith bargaining to reach a new agreement that reflects the current economic circumstances. The decision ensures that the agreement remains fair and reasonable for both parties in light of the significant changes in circumstances.

Glasshouse Country Care Association Inc T/A Glasshouse Country Care

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established