JY Cairns Esplanade Operations Pty Ltd

[2021] FWCA 3685

[2021] FWCA 3685

The attached document wholly replaces the document previously issued with the code [2021] FWC 3676 on 25 June 2021 to correct document referencing.

Associate to Deputy President Lake

Dated 25 June 2021

[2021] FWCA 3685

FAIR WORK COMMISSION

DECISION

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

JY Cairns Esplanade Operations Pty Ltd
(AG2021/4313)

RYDGES ESPLANADE ENTERPRISE AGREEMENT 2009

Hospitality
DEPUTY PRESIDENT LAKE	BRISBANE, 25 JUNE 2021

Application for termination of an enterprise agreement after its nominal expiry date.

[1] JY Cairns Esplanade Operations Pty Ltd (the Applicant) has made an application for the Fair Work Commission (the Commission) to terminate the Rydges Esplanade Enterprise Agreement 2009 (the Agreement) pursuant to s.225 of the Fair Work Act 2009 (the Act).

[2] There are three employers covered by the agreement, including the Applicant. The remaining two employers covered by the Agreement are Cairns Esplanade Operation Pty Ltd and The Trustee for Luxxe Outsourced Hotel Services Unit Trust (Luxxe) because of a transfer of business. By way of background, on or around 19 December 2016, Abacus Matson Holding Pty Ltd transferred its business pursuant to s.311 of the Act to Cairns Esplanade Operations Pty Ltd. Abacus was subsequently deregistered with the Australian Securities and Investments Commission on 23 June 2020. On or around July 2019, Cairns Esplanade Operations Pty Ltd outsourced certain operational functions to Luxxe, constituting a transfer of business pursuant to s.311 of the Act. On or around 15 June 2019, a further transfer occurred, pursuant to s.311 of the Act, from Cairns Esplanade Operations Pty Ltd to the Applicant.

[3] The Agreement had a nominal expiry date of 10 November 2013.

[4] The Applicant completed and filed a Form F24C – Statutory declaration in support of the application, providing that it seeks termination of the Agreement as it is out of date by more than seven years, and due to its age lacks several terms and conditions that are included in the relevant Modern Award that would apply to employees in the absence of the Agreement.

[5] The Applicant indicated in its application that The Australian Workers’ Union of Employees, Queensland (AWUQ)was an employee organisation covered by the Agreement.

[6] I issued directions inviting the employees, employers and AWUQ to make submissions in response to the application. Directions were issued for filing of formal materials on 19 April 2021. Those directions were amended at the request of the parties, but my Chambers received responses from the Applicant and AWUQ by 18 May 2021.

[7] This matter is to be determined on the papers.

Employer’s submissions

[8] The Employer filed and relied on the F24C – Declaration in relation to termination of an enterprise agreement after the nominal expiry date and a witness statement, both made by Mrs Kellie Eustace on 22 March 2021 and 10 May 2021 respectively.

[9] Mrs Eustace stated that she held the role of Area General Manager for the Applicant.

[10] Mrs Eustace stated that she was not aware of any matters arising from the termination of the Agreement that would be contrary to the public interest, which she understood to broadly include matters outside of the employer and employee’s direct interests. Further, termination of the Agreement would be in the public interest given it would assist in the maintenance of proper industrial standards.

[11] Mrs Eustace understood the effect of the termination would been that employees currently covered by the Agreement will instead be covered by the applicable Modern Award, which for most is Hospitality Industry (General) Award 2020. A number of transfer of business scenarios have occurred at the hotel and resulted in employees potentially being subject to the application of different industrial instruments. Mrs Eustace stated that the termination of the Agreement would “increase business synergy and reduce complexity by consolidating all employees… onto the same employment arrangements”.

[12] In her declaration dated 22 March 2021, Mrs Eustace outlined the steps taken by the Hotel to ascertain the views of its employees in respect of the potential termination of the Agreement. To that end, the employees were provided with a memorandum on or around 25 February, which explained the proposed termination process and provided employees with a document comparing the key terms of the Agreement against the relevant modern award. Employees were then invited to participate in an anonymous survey or contact the Applicant’s financial controller with any questions or feedback. Apart from the test response by the Applicant to ensure the survey was working, only one employee responded to the survey, indicating that they did not oppose the Application. Mrs Eustace stated that the financial controller had indicated that no other feedback was received in opposition to the application.

[13] Mrs Eustace stated that under the Award, employees who work weekends and evenings would generally receive more favourable conditions of employment as compared to the current Agreement. Employees who do not work weekends would maintain their current base rate of pay.

[14] In her statement dated 10 May 2021, Mrs Eustace gave evidence that a copy of the Directions, the application, the Form 24C and its annexures, a document comparing key terms of the Agreement against the Hospitality Industry (General) Award 2020 and a document indicating example calculations of weekly pay that the Applicant conducted in accordance with the Directions, had been sent to the respective employees in accordance with my Directions. Further, that material was also sent to the two employers – other than the Applicant – who are covered by the Agreement.

[15] The Applicant only received one response from an employee of the Applicant, which stated only, “Many thanks, Kellie”. This was seemingly just an acknowledgment of their receipt of Ms Eustace’s email. No other responses were received from employees of the Applicant. Nor was any response forthcoming from Luxxe or its employees.

[16] In response to the correspondence sent to Cairns Esplanade Operations Pty Ltd, Mrs Eustace was told to forward the letter to Mrs Ros Reeves, the Executive General Manager of Human Resources at Cairns Esplanade Operations Pty Ltd. Mrs Reeves indicated that she had no issues with the application to terminate the Agreement and that they wished the Applicant every success with the change.

[17] In her statement, Mrs Eustace maintained that she was not aware of any matters which would be contrary to the public interest if the Agreement were to be terminated. She also annexed a comparison of example calculations of weekly pay of an employee’s regular hours under the Agreement as against the Award and their employment contract.

[18] Mrs Eustace further indicated that the Applicant had provided an undertaking stating that if the Commission grants the Application to terminate the Agreement, it will maintain the base rate of pay of all its current employees, with Award penalty rates (or other entitlements that are calculated with reference to a base rate of pay) being calculated with reference to the base rate of pay in the Award.

UWUQ’s response

[19] On 17 May 2021, AWUQ indicated that it had discussed the matter with the Applicant and that, upon the Applicant’s giving of the undertakings as outlined above, it did not oppose the application.

Consideration

[20] I am satisfied that on assessment of the materials filed in the Commission, the termination of the Agreement is not contrary to the objects of the Act. The materials filed satisfy me that this is so and that termination of the Agreement will not be contrary to the public interest. The Agreement has passed its nominal expiry date, and there will be no adverse effect on employees if the application is granted.

[21] Pursuant to s.225 of the Act and having considered and being satisfied about each of the matters contained in s.226 of the Act, I order that the Agreement be terminated.

[22] I order that the termination will operate from 6 July 2021.

DEPUTY PRESIDENT

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