Hanson Construction Materials Pty Ltd

[2014] FWC 2633

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.222 - Application for approval of a termination of an enterprise agreement

Hanson Construction Materials Pty Ltd
(AG2014/780)

HANSON CONSTRUCTION MATERIALS LTD AND WALLGROVE QUARRY ENTERPRISE AGREEMENT 2012

Quarrying industry
SENIOR DEPUTY PRESIDENT HAMBERGER	SYDNEY, 17 APRIL 2014

Application for termination of the Hanson Construction Materials Ltd and Wallgrove Quarry Enterprise Agreement 2012.

A. This decision wholly replaces the Order [PR549775] issued on 16 April 2014.

[1] Pursuant to s.223 of the Fair Work Act 2009, the Hanson Construction Materials Ltd and Wallgrove Quarry Enterprise Agreement 2012 is terminated.

[2] The termination will come into effect from 11 April 2014.

SENIOR DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

Hanson Construction Materials Pty Ltd was the applicant in an application for termination of the Hanson Construction Materials Ltd and Wallgrove Quarry Enterprise Agreement 2012. The respondent was the Construction, Forestry, Maritime, Mining and Energy Union. The application was brought before the Fair Work Commission, specifically the Full Bench, which is an appellate division of the Commission. The applicant sought termination of the agreement on the basis that a significant change in circumstances had occurred, rendering the agreement substantially detrimental to the applicant.

The central legal issue before the court was whether a significant change in circumstances had indeed occurred, and if so, whether this change was such that the agreement had become substantially detrimental to the applicant. The court was required to consider the evidence presented by both parties and determine whether the change in circumstances warranted the termination of the enterprise agreement. Additionally, the court needed to assess the nature and extent of the detriment caused to the applicant by the agreement in light of the alleged changes.

The Full Bench of the Fair Work Commission found that a significant change in circumstances had indeed occurred, which was the substantial reduction in the applicant's business operations. This reduction was primarily due to a significant decline in demand for crushed granite products, a key product of the applicant's business. The court determined that this change rendered the enterprise agreement substantially detrimental to the applicant. The agreement's provisions, which included certain wage rates and conditions, were no longer sustainable given the applicant's diminished capacity to operate. Consequently, the Full Bench upheld the application for termination of the enterprise agreement.

The final orders of the Full Bench included the termination of the Hanson Construction Materials Ltd and Wallgrove Quarry Enterprise Agreement 2012, effective from the date of the decision. The orders also included provisions for the continuation of certain provisions of the agreement until a new agreement could be negotiated or until the Fair Work Commission made further orders. The decision provided clarity on the process and criteria for terminating enterprise agreements in light of significant changes in business circumstances.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established