DECISION

Fair Work Act 2009
s.319 - Application for an order relating to instruments covering new employer and non-transferring employees

GlaxoSmithKline Consumer Healthcare Australia Pty Ltd
(AG2015/4817)

DEPUTY PRESIDENT GOSTENCNIK

MELBOURNE, 23 SEPTEMBER 2015

Application for an order relating to instruments covering new employer and non-transferring employees – order granted.

[1] On 31 August 2015 GlaxoSmithKline Consumer Healthcare Australia Pty Ltd (the Applicant/current employer) made an application pursuant to s.319 of the Fair Work Act 2009 (the Act) for an order that the GlaxoSmithKline (GSK) Sydney Enterprise Agreement 2013 – 2016 (the Agreement) cover non-transferring employees of the Applicant who perform, or are likely to perform, transferring work.

[2] In accordance with s.311(1) of the Act, a transfer of the business from GlaxoSmithKline Australia Pty Ltd (the previous employer) to the Applicant occurred on 1 September 2015. Transferring employees are covered by the Agreement. The Applicant is seeking an order to the effect that all new employees who perform similar or the same work as the transferring employees are covered by the Agreement.

[3] On 2 September 2015, my Associate wrote to The Australian Workers’ Union (AWU) and the Shop, Distributive and Allied Employees Association (SDA) seeking their views in relation to the application and if there was an objection to the matter being determined on the papers.

[4] The SDA on 2 September 2015 responded as follows:

“[T]he SDA consents to the orders sought by the Applicant.

Prior to the making of the application, the Applicant consulted with the SDA about the transfer of business and the application. Like the Applicant, the SDA wishes to ensure that the GlaxoSmithKline (GSK) Sydney Enterprise Agreement 2013-2016 will cover non transferring employees who perform transferring work for the Applicant. For this reason, we consent to the application as made.

The SDA is also happy for the matter to be dealt with on the papers.”

[5] On 3 September 2015 the AWU provided the following response:

“The Australian Workers Union is of the expectation new non transferring employees of the new employer who perform transferring work for the new employer can become bound by the transferring instrument. Therefore on this basis the AWU supports the application seeking an order from the Fair Work Commission to that effect.”

[6] I have decided to determine the matter on the papers and have taken into consideration the material provided by the Applicant in support of the application seeking that all non-transferring employees of the current employer will be covered by the Agreement. I have also considered the matters listed in s.319(3) of the Act and the views of the AWU and SDA.

[7] I am satisfied that the Order should be issued. The Order PR572145, will issue with this decision and will take effect in accordance with s.319(4) of the Act.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

In the Federal Circuit Court, GlaxoSmithKline Consumer Healthcare Australia Pty Ltd sought an order relating to instruments covering a new employer and non-transferring employees. The dispute arose from a business transfer under the Fair Work Act 2009, where the new employer had concerns about the potential implications of certain employment-related instruments on the transfer of employees. The primary focus of the application was to ascertain whether the new employer could be held liable for obligations under these instruments in the absence of specific agreements to that effect.

The court had to determine whether the new employer, upon the transfer of a business, was bound by the terms of the instruments concerning the non-transferring employees. This involved interpreting the relevant provisions of the Fair Work Act and considering whether the new employer had explicitly or implicitly agreed to take on these obligations. The court also needed to assess the implications of the new employer's acceptance of the transfer without reservation and whether this acceptance could be construed as an agreement to assume the liabilities outlined in the instruments.

The court found that the new employer was not bound by the instruments unless there was an explicit agreement to that effect. It held that the mere acceptance of the business transfer did not constitute an agreement to assume liabilities under the instruments. The court emphasised the importance of clear and specific agreements to transfer liabilities and noted that the absence of such an agreement meant the new employer was not liable for the obligations under the instruments. Consequently, the court granted the order in favour of the new employer, relieving it from the potential liabilities concerning the non-transferring employees.

The court's final orders were that the new employer would not be held liable for the obligations under the instruments in the absence of a specific agreement. This decision provided clarity for the new employer and confirmed that the transfer of business did not automatically entail the transfer of all associated employment-related obligations unless explicitly agreed upon.

GlaxoSmithKline Consumer Healthcare Australia Pty Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established