Hands On SA Ltd T/A Mobo Group

[2021] FWCA 2385

[2021] FWCA 2385

FAIR WORK COMMISSION

DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument

Hands On SA Ltd T/A Mobo Group
(AG2021/4584)

HANDS ON SA ENTERPRISE AGREEMENT 2003

Health and welfare services
COMMISSIONER HAMPTON	ADELAIDE, 30 APRIL 2021

Application for termination of the Hands On SA Enterprise Agreement 2003.

[1] This decision concerns an application by Hands On SA Ltd T/A Mobo Group (the Applicant or HOSA) utilising s.225 of the Fair Work Act 2009 (the FW Act). The application seeks to terminate the Hands On SA Enterprise Agreement 2003 (the Enterprise Agreement). The Enterprise Agreement was approved pursuant to s.79 of the Industrial and Employee Relations Act 1994 (SA) by the Industrial Relations Commission of South Australia on 7 December 2004 1. The Enterprise Agreement had a nominal expiry date of 7 December 2006.

[2] A hearing by telephone was conducted in this matter on 30 April 2021. At the conclusion of that hearing, I expressed my intention to terminate the Enterprise Agreement and indicated that I would subsequently provide a written decision.

[3] The Enterprise Agreement is a collective agreement-based transitional instrument 2 for the purposes of the Fair Work (Transitional Provisional and Consequential Amendment) Act 2009 (the Transitional Act). This means, in effect, that the Enterprise Agreement remained in force under the terms of the FW Act, subject to certain overriding provisions including the National Employment Standards and the minimum base rates provide by any modern award covering the parties. In this case, the Supported Employment Services Award 2020 (SES Award) covers the parties although it does not presently apply to them due to the continued operation of the Enterprise Agreement.3

[4] Item 16 of Schedule 3 (or in the alternative - Item 23 of Schedule 3A) 4 of the Transitional Act provides that an agreement of this kind may be terminated by the Commission under Part 2-4 of the FW Act.

[5] Subdivision D of Division 7 of Part 2-4 of the FW Act provides:

“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.

227 When termination comes into operation

If an enterprise agreement is terminated under section 226, the termination operates from the day specified in the decision to terminate the agreement.”

[6] The application was accompanied by a statutory declaration of Ms Sandra Montagu, Organisation Development Manager of the Applicant, relevantly setting out the grounds for the application to terminate the Enterprise Agreement. Those grounds included contentions to the effect of the following:

•  The Applicant is a not-for-profit organisation that provides supported employment and open employment services to people living with disability. Further it supports job seekers with disability or disadvantage into open employment;

•  HOSA was formally known as Invicta Services Limited and changed its name to Hands On SA Limited in 2012;

•  The Enterprise Agreement applies only to those employees with a disability;

•  The Enterprise Agreement is outdated and many (or most) aspects of the instrument have been superseded by the SES Award;

•  The SES Award is more beneficial to the employees in all relevant respects and all employees will be better off with the termination;

•  The Applicant has a significant administrative burden having employees working side by side under three separate industrial instruments;

•  The proportion of employees covered by this collective agreement will continue to decrease as employees leave and new employees commence employment;

•  As a not-for-profit charitable organisation, the Applicant is struggling to manage the industrial and administrative requirements of the outdated pre-reform collective agreement and the modern award together with funding challenges of the NDIS; and

•  The termination will provide clarity for the Applicant and its employees in relation to their terms and conditions of employment and minimise the prospect of inadvertent non-compliance with one of the instruments.

[7] During the hearing, HOSA confirmed the extensive efforts it had undertaken to explain to employees, in appropriate terms, the intention to apply for the termination of the Enterprise Agreement and the manner in which it consulted with them as to the consequences of the application. There were no unresolved issues raised by the employees or their parents/carers.

[8] Given the status of the Enterprise Agreement, the Applicant is entitled to apply for its termination under s.225 of the FW Act.

[9] In the lead up to the hearing of this matter, directions were issued requiring the Applicant to ensure that any affected employees were aware of this hearing and provide details for any affected employee to make a contribution about the application to terminate the agreement. I note that HOSA has confirmed that all employees were provided a copy of the notice of listing and information was available to explain the application.

[10] The Commission did receive telephone confirmation from at least one parent of an affected employee covered by the Enterprise Agreement, however upon noting the reason for the hearing, expressed no concerns and did not wish to be heard in relation to the application. Given this fact, and the evidence provided by Ms Montagu, I am satisfied that the employees support, or at least do not oppose, the application.

[11] The statutory environment in which the Enterprise Agreement now operates is significantly different to that in which it was approved. The continued operation of the Enterprise Agreement also prevents the full legal application of the SES Award. 5

[12] Although HOSA has applied more beneficial arrangements than required by the Enterprise Agreement, it is appropriate that what is now a very much outdated and largely redundant instrument no longer apply. Employees will not be disadvantaged by the termination of the instrument and the formal conclusion of the Enterprise Agreement is sought by the applicant employer.

[13] Having had regard to the material provided with the application and during the hearing, I am satisfied that it would not be contrary to the public interest to terminate the Enterprise Agreement and that it is appropriate in all of the circumstances, including having regard to the views of the relevant parties, to do so. Given these findings and the terms of the FW Act provided in s.226, the Commission is obliged to terminate the Enterprise Agreement.

[14] The Enterprise Agreement is terminated, and the termination will take effect on and from 11:59 pm on 30 April 2021.

COMMISSIONER

 1   The Industrial Relations Commission of SA was the relevant jurisdiction at that time.

 2   Schedule 3 (or Schedule 3A) of the Transitional Act.

 3 s.47 and s.48 of the FW Act.

 4   Depending upon whether the Enterprise Agreement is considered to be a Division 2B State employment agreement.

 5 Under the Transitional Act the Enterprise Agreement prevails over the modern award to the extent of any inconsistency – subject to the various minimum standards of the FW Act.

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