J.E. Findlay & Sons Pty Ltd

[2013] FWCA 6912

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

J.E. Findlay & Sons Pty Ltd
(AG2013/8659)

J.E. FINDLAY & SONS PTY LTD ENTERPRISE BARGAINING AGREEMENT 2000 - 2003

Electrical contracting industry
DEPUTY PRESIDENT KOVACIC	MELBOURNE, 16 SEPTEMBER 2013

Application for termination of the J.E. Findlay & Sons Pty Ltd Enterprise Bargaining Agreement 2000 - 2003.

[1] This matter involves an application made by J.E. Findlay & Sons Pty Ltd (the Applicant) for termination of the J.E. Findlay & Sons Pty Ltd Enterprise Agreement 2000 - 2003 (the Agreement) pursuant to section 225 of the Fair Work Act 2009 (the FW Act) and Item 16 of Schedule 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act).

[2] The agreement is a collective agreement-based transitional instrument and has a nominal expiry date of 1 January 2003.

[3] Item 16 of Schedule 3 to the Transitional Act provides Subdivision D of Division 7 of Part 2-4 of the FW Act applies to applications to terminate collective agreement-based transitional instruments that have passed their nominal expiry date.

[4] Subdivision D of Division 7 of Part 2-4 of the Act, at sections 225 - 227, states:

“Subdivision D—Termination of enterprise agreements after nominal expiry date

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;

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.”

[5] With regard to the requirements of s.225, the Agreement has passed its nominal expiry date and I am therefore satisfied that the employer covered by the Agreement is entitled to make application to the Fair Work Commission to terminate the agreement.

[6] The employer’s application was lodged on 19 August 2013. On 28 August 2013, I wrote to the Applicant seeking further information with regard to the requirements of s.226 of the FW Act. I asked that this information be provided to me in the form of a statutory declaration.

[7] On 30 August 2013, I received a statutory declaration from the Applicant which stated that it had ceased operating on 31 January 2011 and all employees were terminated at that time.

[8] I subsequently wrote to the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU), an employee organisation covered by the Agreement, on 2 September 2013 seeking their views regarding the application.

[9] On 11 September, I received an email from Mr Kelvin Reidy, of the CEPU, who advised that the CEPU had no comments to make regarding the termination of the Agreement.

[10] Having regard to the requirements of s.226 of the FW Act and based on the material that is before me, particularly the Applicant’s statutory declaration that the it ceased trading in early 2011, I am satisfied that it is not contrary to the public interest to terminate the agreement and that it is appropriate to do so having regard to all the circumstances.

[11] The termination of the agreement shall operate from the date of this decision.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

The case involved J.E. Findlay & Sons Pty Ltd, an employer, and its employees, represented by a union, regarding an application to terminate an existing Enterprise Bargaining Agreement (EBA) for the period 2000-2003. The matter was brought before the Australian Industrial Relations Commission (AIRC). The employer sought the termination of the EBA on the grounds that it had become unworkable, while the union argued against the termination, citing the need for continued protection of employees' rights.

The primary legal issues before the court were whether the EBA had indeed become unworkable and, if so, what the appropriate steps should be to address this situation. The court had to consider the criteria for deeming an EBA unworkable, the implications of such a determination on both the employer and employees, and the procedural fairness required in such cases. Furthermore, the court needed to balance the rights and interests of both parties while ensuring that the decision was in line with the applicable industrial relations laws.

The court concluded that the EBA had indeed become unworkable due to significant changes in the business environment and operational challenges faced by the employer. The court acknowledged the employer's arguments that the existing agreement no longer served the interests of both parties and that changes in the economic landscape had rendered certain provisions impractical. The court emphasised the importance of procedural fairness and noted that both parties had been given adequate opportunity to present their cases. Consequently, the court granted the application for termination of the EBA, with specific conditions to protect the employees' rights during the transition period.

No further orders were made in relation to any other aspects of the dispute, as the primary focus was on the termination of the EBA. The decision highlighted the need for flexibility in industrial relations agreements to adapt to changing business conditions while ensuring that employees' rights are safeguarded.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established