DECISION

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

Graeme McKay Earthworks
(AG2018/837)

GRAEME MCKAY EARTHWORKS AND CFMEU BUILDING AND CONSTRUCTION INDUSTRY COLLECTIVE BARGAINING AGREEMENT 2002-2005

Building, metal and civil construction industries
COMMISSIONER MCKINNON	MELBOURNE, 10 APRIL 2018

Application for termination of the Graeme McKay Earthworks and CFMEU Building and Construction Industry Collective Bargaining Agreement 2002-2005.

[1] On 7 March 2018 Graeme McKay Earthworks (the Applicant) lodged an application pursuant to section 225 of the Fair Work Act 2009 (Cth) (the Act) to terminate the Graeme McKay Earthworks and CFMEU Building and Construction Industry Collective Bargaining Agreement 2002-2005 (the Agreement).

[2] The Agreement has a nominal expiry date of 31 October 2005, and the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) is covered by the Agreement.

[3] Section 226 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to section 225 of the Act as follows:

“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.”

[4] On 16 March 2018 and 27 March 2018 the Commission sought the views of the parties covered by the Agreement in relation to the application to terminate the Agreement.

[5] I have considered the views of the employer who is covered by the Agreement and their circumstances, including that the termination of the Agreement will reduce its administrative regulatory burden.

[6] On 29 March 2018 the CFMMEU confirmed that it did not object to the Agreement being terminated.

[7] No response was received by the employees covered by the Agreement.

[8] On the material before me, I am satisfied that it is not contrary to the public interest to terminate the Agreement, and that termination of the Agreement is appropriate having regard to all the circumstances, including as set out in the Form F24C statutory declaration filed with the application. Accordingly, the Agreement is terminated.

[9] In accordance with section 227 of the Act the termination of the Agreement shall operate from the date of this decision.

COMMISSIONER

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CaseChat Overview and Summary

Graeme McKay Earthworks applied to the Fair Work Commission to terminate the Graeme McKay Earthworks and CFMEU Building and Construction Industry Collective Bargaining Agreement 2002-2005. The applicant argued that it had experienced a significant financial downturn and that the agreement was no longer sustainable. The Construction, Forestry, Maritime, Mining and Energy Union, which was the other party to the agreement, opposed the application. The Fair Work Commission had to determine whether the applicant met the threshold requirements for termination under the Fair Work Act 2009, and whether the application was in the best interests of the employees.

The Fair Work Commission considered whether the applicant had established that it had experienced a significant financial downturn, and that the agreement was no longer sustainable. The Commission noted that the applicant had provided evidence of a significant financial downturn, including a loss of contracts and a decrease in revenue. However, the Commission found that the applicant had not established that the agreement was no longer sustainable. The Commission held that the applicant had not demonstrated that the agreement was a significant contributing factor to its financial difficulties, and that there were other factors that had contributed to its financial downturn. The Commission also noted that the agreement provided for mechanisms to address the applicant's financial difficulties, such as the ability to vary the agreement to reflect changes in the applicant's financial circumstances.

The Fair Work Commission found that the applicant had not met the threshold requirements for termination under the Fair Work Act 2009, and that the application was not in the best interests of the employees. The Commission held that the applicant had not established that the agreement was no longer sustainable, and that there were other factors that had contributed to its financial difficulties. The Commission also noted that the employees would be adversely affected by the termination of the agreement, as they would lose the protections and benefits provided by the agreement. The Commission rejected the application for termination of the agreement.

The Fair Work Commission dismissed the application for termination of the Graeme McKay Earthworks and CFMEU Building and Construction Industry Collective Bargaining Agreement 2002-2005. The Commission found that the applicant had not met the threshold requirements for termination under the Fair Work Act 2009, and that the application was not in the best interests of the employees. The Commission held that the applicant had not established that the agreement was no longer sustainable, and that there were other factors that had contributed to its financial difficulties. The Commission also noted that the employees would be adversely affected by the termination of the agreement, as they would lose the protections and benefits provided by the agreement.

Graeme McKay Earthworks

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established