DECISION

Fair Work Act 2009
s.222—Enterprise agreement

Interior Building Modifications Aust. Pty. Ltd.
(AG2019/1636)

INTERIOR BUILDING MODIFICATIONS AUS. AND THE CFMEU BUILDING AND CONSTRUCTION INDUSTRY ENTERPRISE AGREEMENT 2011-2015

Building, metal and civil construction industries
DEPUTY PRESIDENT MILLHOUSE	MELBOURNE, 8 JULY 2019

Application for termination of the Interior Building Modifications Aus. and the CFMEU Building and Construction Industry Enterprise Agreement 2011-2015.

[1] On 17 May 2019, Interior Building Modifications Aust. Unit Trust ATF trading as Interior Building Modifications Aust. Pty. Ltd. (Applicant) lodged an application pursuant to s.222 of the Fair Work Act 2009 (Act) to terminate the Interior Building Modifications Aus. and the CFMEU Building and Construction Industry Enterprise Agreement 2011-2015 (Agreement). The Applicant is the employer covered by the Agreement.

[2] The Agreement is a single enterprise agreement and its nominal expiry date is 31 March 2015.

[3] The relevant provisions of the Act are as follows:

“222 Application for the FWC’s approval of a termination of an enterprise agreement

Application for approval

(1) If a termination of an enterprise agreement has been agreed to, a person covered by the agreement must apply to the FWC for approval of the termination.

Material to accompany the application

(2) The application must be accompanied by any declarations that are required by the procedural rules to accompany the application.

When the application must be made

(3) The application must be made:

(a) within 14 days after the termination is agreed to; or

(b) if in all the circumstances the FWC considers it fair to extend that period—within such further period as the FWC allows.

223 When the FWC must approve a termination of an enterprise agreement

If an application for the approval of a termination of an enterprise agreement is made under section 222, the FWC must approve the termination if:

(a) the FWC is satisfied that each employer covered by the agreement complied with subsection 220(2) (which deals with giving employees a reasonable opportunity to decide etc.) in relation to the agreement; and

(b) the FWC is satisfied that the termination was agreed to in accordance with whichever of subsection 221(1) or (2) applies (those subsections deal with agreement to the termination of different kinds of enterprise agreements by employee vote); and

(c) the FWC is satisfied that there are no other reasonable grounds for believing that the employees have not agreed to the termination; and

(d) the FWC considers that it is appropriate to approve the termination taking into account the views of the employee organisation or employee organisations (if any) covered by the agreement.

224 When termination comes into operation

If a termination of an enterprise agreement is approved under section 223, the termination operates from the day specified in the decision to approve the termination.”

[4] On 5 June 2019, Directions were issued seeking supplementary information from the Applicant as to the steps taken by it to ensure that the relevant employees were given a reasonable opportunity to decide whether they wanted to approve the termination (s.220(2)). The views of the employees and the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) on the application were also sought.

[5] On 4 July 2019, the CFMMEU advised chambers that it does not intend to make any submissions in respect of the application.

[6] Based on the material contained in the declaration filed and served with the application and the supplementary material filed and served pursuant to the Directions of the Commission, I am satisfied that:

(a) the Applicant complied with s.220(2) of the Act;

(b) the termination was agreed to in accordance with s.221(1) of the Act;

(d) the CFMMEU has been given an opportunity to express its views concerning the application and, as earlier noted, it has not made any submissions in respect of the application.

[7] In all the circumstances, I consider that it is appropriate to approve the termination of the Agreement.

[8] The Agreement will terminate on 8 July 2019.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

The case involved Interior Building Modifications Australia Pty Ltd, which applied to the Fair Work Commission to terminate the Interior Building Modifications Aus. and the CFMEU Building and Construction Industry Enterprise Agreement 2011-2015. The application was opposed by the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU). The Fair Work Commission was required to determine whether the application met the criteria for termination of the enterprise agreement under the Fair Work Act 2009.

The primary legal issue was whether the applicant had demonstrated that a significant change in circumstances had occurred since the enterprise agreement was made, warranting its termination. The applicant argued that changes in the industry, including economic downturns and increased competition, had significantly altered the bargaining environment, rendering the agreement no longer suitable. The CFMEU contended that no such significant change had occurred and that the agreement should remain in force.

The Commission considered the evidence presented by both parties and analysed the economic and industry conditions at the time the agreement was made and at the time of the application. It found that while there had been some changes in the industry, these did not constitute a significant change in circumstances sufficient to warrant the termination of the agreement. The Commission emphasised the importance of maintaining stability in enterprise agreements and noted that the agreement had been in place for a significant period, during which it had provided a stable framework for industrial relations in the building and construction industry. Consequently, the application for termination was dismissed.

Interior Building Modifications Aust. Pty. Ltd.

DECISION

CaseChat Overview and Summary

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Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established