Holyoake Australian Institute for Alcohol and Drug Addiction Resolution Inc

[2020] FWCA 4700

[2020] FWCA 4700

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Holyoake Australian Institute for Alcohol and Drug Addiction Resolution Inc
(AG2020/1459)

HOLYOAKE, THE AUSTRALIAN INSTITUTE FOR ALCOHOL AND DRUG ADDICTIONS RESOLUTIONS INC. EMPLOYEE COLLECTIVE AGREEMENT 2012

Social, community, home care and disability services
DEPUTY PRESIDENT BINET	PERTH, 9 OCTOBER 2020

Application for termination of the Holyoake, the Australian Institute for Alcohol and Drug Addictions Resolutions Inc. Employee Collective Agreement 2012.

[1] Holyoake Australian Institute for Alcohol and Drug Addiction Resolution Inc (Holyoake) has made an application (Application) to the Fair Work Commission (FWC) to terminate the Holyoake, The Australian Institute for Alcohol and Drug Addictions Resolutions Inc. Employee Collective Agreement 2012 (Agreement) pursuant to section 225 of the Fair Work Act 2009 (Cth) (FW Act).

[2] The Agreement was approved by Commissioner Cloghan pursuant to section 186 of the FW Act, on 18 April 2013 and, commenced operation on 25 April 2013. The Agreement has a nominal expiry date of 31 January 2016.

[3] The parties to the Agreement are Holyoake and all employees of Holyoake, excluding those employees who are part of the leadership management team (Employees).

[4] The Australian Municipal, Administrative, Clerical and Services Union (ASU) was a bargaining representative for the Agreement.

[5] In support of the Application, Holyoake filed a statutory declaration by Ms Angie Paskevicius, CEO of Holyoake (Paskevicius Declaration).

[6] On 29 June 2020, directions were issued with respect to the Application (Directions). Holyoake was directed to file an outline of submissions in support of the Application and any evidence on which they relied by 4pm Thursday 9 July 2020. The ASU were directed to file an outline of submissions in response to the Application and any evidence on which the ASU sought to rely by 4pm Thursday 23 July 2020.

[7] The Directions also required Holyoake to provide a copy of the materials filed by the parties in accordance with the Directions and a copy of the Directions to each of the Employees. The Directions contained an invitation for any of the Employees who wished to be heard in relation to the Application to contact Chambers by 4pm, Thursday 6 August 2020. None of the Employees contacted Chambers by this date or by the date of this decision.

[8] On 19 August 2020 the ASU confirmed it did not oppose the termination of the Agreement and did not wish to be heard in relation to this matter.

Background

[9] Holyoake operates in the social, community, home care and disability services industry, within Western Australia.

[10] Of the Employees currently covered by the Agreement, four are of Aboriginal or Torres Strait heritage and 60 are over the age of 45 years old.

[11] If the Agreement is terminated, Holyoake propose to engage employees under the Social Community Home Care and Disability Services Award MA000100 (Award).

Legislation

[12] Subdivision D of Division 7 of Part 2-4 of the FW Act sets out the mechanism by which an enterprise agreement may be terminated after the agreement has passed its nominal expiry date.

[13] Section 225 of the FW Act provides that:

“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.”

[14] As the Agreement has passed its nominal expiry date and Holyoake is an employer covered by the Agreement, I find that Holyoake has standing to make the Application pursuant to section 225(a) of the FW Act.

[15] Section 226 of the FW 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.”

Is it contrary to the public interest to termination the Agreement?

[16] Section 226(a) requires the FWC to be satisfied that it is not contrary to the public interest to terminate the Agreement.

[17] This requires the FWC to consider how the termination of the Agreement might foreseeably affect the public as a whole, such as the impact on the achievement or otherwise of the various objects of the Act, employment levels, inflation and the maintenance of proper industrial standard. 1

[18] There is no positive onus on the applicant to persuade the FWC that there are positive benefits to the public interest arising from the termination. In Geelong Wool Combing Ltd (AIRC) 5 September 2003, Commissioner Wheelan said:

“… the Commission must be persuaded that termination is contrary to the public interest [and] in the absence of any effect of termination which is contrary to the public interest it is not necessary to persuade the Commission that there are positive benefits to the public interest arising from the termination.”

[19] The public interest is distinct in nature from the interests of those covered by the Agreement. The views of those covered by an agreement may be relevant to the exercise of the discretion if they shed light on the effect of the termination on public interest but those views should not be given any independent weight. 2

[20] The objects of the FW Act are set out in section 3 of the FW Act, as follows:

“3. Object of this Act

The object of this Act is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians by:

…

(b) ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards, modern awards and national minimum wage orders;

…

(f) achieving productivity and fairness through an emphasis on enterprise level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action;

…”

[21] The specific objects in section 171 of the FW Act inform how the general object in section 3 of the FW Act is to be satisfied in the context of matters dealt with in Part 2-4 of the FW Act:

“171. Objects of this Part

The objects of this Part are:

(a)  to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and

(b)  to enable the FWC to facilitate good faith bargaining and the making of enterprise agreements, including through:

(i) making bargaining orders; and

(ii) dealing with disputes where the bargaining representatives request assistance; and

(iii) ensuring that applications to the FWC for approval of enterprise agreements are dealt with without delay.”

[22] The ascertainment of what is not in the public interest does not involve the mere identification of a consequence of the termination of the agreement that is arguably contrary to the public interest. The ascertainment of the public interest may involve balancing countervailing public interests. 3

[23] Holyoake submits that there are no matters contrary to the public interest in terminating the Agreement and that, rather, there are factors that are in the public interest in terminating the Agreement that may be considered by the Commission.

[24] Holyoake submit that the termination of the Agreement will permit them to operate on a level playing field with other like community and disability service operators.

[25] Holyoake further submit the termination of the Agreement and the application of Award conditions of employment will improve the economic viability and long-term sustainability of the business and consequently create additional employment opportunities.

[26] The ASU has not submitted any evidence to suggest that the termination of the Agreement is contrary to the public interest.

[27] Based on the submissions of the parties and the evidence before me, I am satisfied that it is not contrary to the public interest to terminate the Agreement.

What are the views of the Employees covered by the Agreement?

[28] Holyoake tendered evidence of the consultation which it has undertaken to ascertain the view of the Employees covered by the Agreement. Employees were notified of the proposal to terminate the Agreement via email and invited to raise any questions they might have by return email.

[29] The Directions also required Holyoake to provide a copy of the materials filed by the parties in accordance with the Directions and a copy of the Directions to each of the Employees. The Directions contained an invitation for any of the Employees who wished to be heard in relation to the Application to contact Chambers. None of the Employees contacted Chambers by the date of this decision.

What are the views of the Employee Organisation covered by the Agreement?

[30] The ASU does not oppose the Application.

What are the views of the Employer covered by the Agreement?

[31] Holyoake submit that the Agreement is outdated and unsuitable given the changes to Holyoake’s structure and operations as a consequence of reforms to the disability sector.

What are the circumstances of the Employees covered by the Agreement?

[32] Holyoake say that in the past the employment conditions it has been able to offer Employees have been generous however because of the current operating environment some of these benefits may not be financially viable in the future.

[33] The Agreement contains some terms and conditions which are more advantageous for Employees than the Award.

[34] In its submissions Holyoake indicated that it would not reduce Employee rates of pay if the Agreement is terminated.

[35] Furthermore, Holyoake have provided an undertaking to the FWC to preserve the following employee benefits in company policy, so long as those benefits remain economically viable:

•  Salary Packaging

•  Professional Development,

•  Professional Indemnity

•  Special Leave

•  Qualification Recognition

•  Paid Parental Leave

•  Study Assistance

•  Pre-purchased Leave

What are the circumstances of the Employee Organisation covered by the Agreement?

[36] The ASU do not oppose the termination of the Agreement and have elected not to make any submissions in relation to this Application.

What are the circumstances of the Employer covered by the Agreement?

[37] Holyoake submits that the Agreement does not provide it with the flexibility required to adjust the benefits and entitlements it offers employees to match the current economic position in which it finds itself and this is impacting on its ability to sustain the employment of its current workforce.

Is it appropriate to terminate the Agreement taking into all the circumstances?

[38] In assessing the views and circumstances of the parties it is important to remember that:

“Taking into account the views and circumstances of the parties involves far more than an expression of their views in support or opposition to termination. It should involve a reason for their views and the validity of their concerns.” 4

[39] The Agreement came into effect over 7 years ago and is now more than 4 years past its nominal expiry date. Substantial changes to the operating environment in the sector in which Holyoake operates have occurred which Holyoake must respond to.

[40] This has been recognised by the ASU and Employees in their decision not to oppose the Application or make any submissions in relation to the Application.

Conclusion

[41] For the reasons enunciated above, I am satisfied that it is not contrary to the public interest to terminate the Agreement.

[42] Taking into account all the circumstances, including the views and circumstances of Holyoake, its employees and the ASU, I am satisfied that it is appropriate to terminate the Agreement.

[43] Accordingly, the Agreementis terminated. The termination is to take effect on and from Friday 16 October 2020. An Order to this effect will be issued in conjunction with this Decision.

DEPUTY PRESIDENT

 1   Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000 (2005) 139 IR 34, 40 – 41.

 2   Ibid.

 3   Kellogg Brown & Root Pty Ltd & Ors and Esso Australia Ltd (2005) 139 IR 34 referred to the decision of the High Court of Australia in Queensland Electricity Commission; Ex parte Electrical Trades Union of Australia (1987) 61 ALJR 393.

 4   Energy Resources Australia Ltd v Liquor, Hospitality and Miscellaneous Union[2010] FWA 2434, [16].

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