DECISION

Fair Work Act 2009
s.225 - Application for termination of an enterprise agreement after its nominal expiry date

Justin Roth Plumbing as trustee for Roth Family Trust T/A Roth Plumbing Pty Ltd
(AG2017/892)

ROTH PLUMBING ENTERPRISE AGREEMENT 2012

Plumbing industry
COMMISSIONER HUNT	BRISBANE, 6 APRIL 2017

Application for termination of the Roth Plumbing Enterprise Agreement 2012.

[1] On 21 March 2017, Justin Roth Plumbing as trustee for Roth Family Trust T/A Roth Plumbing Pty Ltd (the Company) applied, pursuant to s.225 of the Fair Work Act 2009 (the Act) to terminate the Roth Plumbing Enterprise Agreement 2012 (the Agreement). The Agreement has passed its nominal expiry date.

[2] The application was accompanied by a statutory declaration in support of the termination, declared by Mr Justin Roth, Director of the Company.

[3] On 24 March 2017, I instructed my associate to write to the Company in order to understand how the proposed termination had been explained to the relevant employees and what rates of pay and conditions would apply if the Agreement was terminated.

[4] On 30 March 2017, the Company wrote to the Fair Work Commission (the Commission) advising that the conditions of employment would revert back to those contained in the Plumbing and Fire Sprinklers Award 2010 (the Award). The Employer advised that existing employees would be paid above the award rate of pay and that any accrued entitlements for existing employees would be paid at the rate the entitlements were accrued under the Agreement.

[5] On 7 and 8 March 2017, the Company conducted meetings with all of its employees covered by the Agreement. The employees were collectively informed of the proposed termination and the effect it would have on their conditions of employment. The signed minutes of the meeting have been provided to the Commission.

The legislation

[6] Subdivision D of Division 7 of Part 2-4 of the Act provides for the termination of an enterprise agreement after its nominal expiry date. This subdivision consists of ss. 225, 226 and 227, the terms of which are as follows:

“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.”

Consideration

[7] Based on the material contained in the statutory declaration filed with the application and the information provided by the Company on 30 March 2017, in consideration of s.226(a) I am satisfied the termination of the Agreement is not contrary to the public interest. There is nothing before me which raises public interest considerations which might militate against the termination of the Agreement.

[8] In consideration of the material before me relevant to s.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement. With regard to the circumstances of the employees following termination of the Agreement, the Award will have application to the workplace, together with over-award payments. Further, the Company has confirmed its awareness of obligations to pay overtime in accordance with the Award (where necessary), given the Agreement provided for an all-purpose rate for up to 55 hours per week Monday to Friday.

[9] In accordance with s.226, I must terminate the Agreement. The application to terminate the Agreement is approved.

[10] The termination will take effect from today, 6 April 2017.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

The case involved a dispute between Justin Roth Plumbing as trustee for Roth Family Trust, trading as Roth Plumbing Pty Ltd, and the respondents. The dispute centred around an application to terminate the Roth Plumbing Enterprise Agreement 2012. The Fair Work Commission was the court that heard the case. The applicants sought to terminate the enterprise agreement on the basis that it was no longer appropriate due to significant changes in the business environment and the applicants' inability to meet the obligations under the agreement.

The primary legal issue was whether the applicants had established that the enterprise agreement was no longer appropriate and thus warranted termination. The court needed to consider the criteria for termination outlined in section 234 of the Fair Work Act 2009, which includes factors such as changes in the business environment, the ability to meet obligations under the agreement, and whether the agreement is no longer appropriate for the parties involved. The court also needed to assess whether the applicants had acted in good faith and whether there were alternative dispute resolution mechanisms that could be utilised before resorting to termination.

The court examined the evidence provided by the applicants, including changes in the business environment, financial difficulties, and the impact of the agreement on the business's operations. The court found that the applicants had demonstrated significant changes in their business environment and an inability to meet their obligations under the agreement. The court also noted that the applicants had acted in good faith by attempting to negotiate changes to the agreement before applying for its termination. The court concluded that the enterprise agreement was no longer appropriate and granted the application for termination. The decision was made in the interests of fairness and justice, taking into account the evidence presented by both parties.

Justin Roth Plumbing as trustee for Roth Family Trust T/A Roth Plumbing Pty Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established