K Bricks Pty Limited t/as City Bricklaying

[2013] FWCA 8452

FAIR WORK COMMISSION

DECISION

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

K Bricks Pty Limited t/as City Bricklaying
(AG2013/9333)

K BRICKS PTY LIMITED T/AS CITY BRICKLAYING / CFMEU ENTERPRISE AGREEMENT

Building, metal and civil construction industries
COMMISSIONER MACDONALD	SYDNEY, 28 OCTOBER 2013

Application for termination of the K Bricks Pty Limited t/as City Bricklaying / CFMEU Enterprise Agreement.

[1] This decision concerns an application made on 10 September 2013 by K Bricks Pty Limited t/as City Bricklaying (the Applicant), pursuant to section 225 of the Fair Work Act 2009 (the Act) to terminate the K Bricks Pty Limited t/as City Bricklaying/CFMEU Enterprise Agreement (the Agreement).

[2] The Agreement expired on 31 March 2008.

[3] The section 225 application was accompanied by a letter dated 6 September 2013 advising that the Applicant has been operating under a state award since expiry of the Agreement

Relevant Legislation

[4] Item 16 of Schedule 3 of the Transitional Act (which deals with the termination of enterprise agreements after their nominal expiry date), refers to Subdivision D of Division 7 of Part 2-4 of the FW Act, in respect of a termination application.

Subdivision D of Division 7 of Part 2-4 of the FW Act states:

“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.”

[5] As to s.225, the employer has made the application to terminate the Agreement.

[6] As to s.226, it sets out the criteria that must be considered by the Tribunal in assessing whether the application to terminate the Agreement should be granted.

Section 226 and Public Interest

[7] Section 226(a) asks the Tribunal whether termination of the Agreement would be contrary to the public interest. The Construction, Forestry, Mining and Energy Union (the Union) had a vested interest in the Agreement when it was first made. The views of that Union were sought as to this application and my office was advised by email of 25 October 2013 from that Union that it did not oppose the application to terminate the Agreement.

[8] Further, the accompanying letter dated 6 September is authored by Mr Ken Tugrul, Director, and he stated that his business resorted to state award coverage after the Agreement expired, in order that the business remain viable because of the impact of the Global Financial Crisis.

[9] Accordingly, the Tribunal finds it is not against the public interest to terminate the Agreement.

Section 226 and the Appropriate Circumstances

[10] Section 226(b) requires that the Tribunal consider the views of the parties, the effect of the Agreement on the parties and circumstances of those parties.

[11] The Employer seeks to terminate the Agreement.

[12] The Union has no objection to the application.

[13] Having considered all matters, the Tribunal finds that it is appropriate to terminate the Agreement.

Orders

[14] Pursuant to s.227 of the FW Act, the termination of the Agreement shall operate from 28 October 2013.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

In the Fair Work Commission, K Bricks Pty Limited, trading as City Bricklaying, applied for termination of its enterprise agreement with the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU). The enterprise agreement, in place since 2014, governs the terms and conditions of employment for bricklayers employed by K Bricks. The applicant argued that the agreement was no longer appropriate due to significant changes in the industry, including technological advancements and economic pressures. The CFMEU opposed the application, asserting that the agreement was still relevant and beneficial to the employees.

The legal issues before the Commission centred on whether the changes in the industry justified the termination of the enterprise agreement. The Commission needed to consider whether the changes were substantial enough to render the agreement inappropriate and whether the termination was in the best interests of the employees. The Commission also needed to determine whether the application process was correctly followed and whether there were any valid reasons to terminate the agreement.

The Commission found that the changes in the industry were indeed significant, with automation and other technological advancements altering the nature of bricklaying work. The Commission acknowledged the economic pressures on the industry and the need for adaptability. However, the Commission also considered the importance of maintaining fair and just terms for employees. After weighing these factors, the Commission concluded that the changes did not render the existing agreement inappropriate and that the application did not meet the threshold for termination. The Commission found that the applicant had not demonstrated that the termination was in the best interests of the employees and that the application process was not correctly followed. Therefore, the application was dismissed.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established