DECISION

Fair Work Act 2009
s.222 - Application for approval of a termination of an enterprise agreement

Karndean International Pty Ltd T/A Kardean Designflooring
(AG2015/4426)

KARNDEAN INTERNATIONAL PTY LTD AND NATIONAL UNION OF WORKERS ENTERPRISE AGREEMENT 2012

Storage services
COMMISSIONER ROE	MELBOURNE, 14 SEPTEMBER 2015

Application for termination of the Karndean International Pty Ltd and National Union of Workers Enterprise Agreement 2012.

[1] This decision concerns an application made on 25 August 2015 by Karndean International Pty Ltd T/A Kardean Designflooring (the Applicant) pursuant to Section 222 of the Fair Work Act 2009 (the Act) to terminate the Karndean International Pty Ltd and National Union of Workers Enterprise Agreement 2012 (the Agreement).

[2] The Agreement has a nominal expiry date of 19 October 2015.

[3] I am satisfied that the Applicant can make this application pursuant to Section 222 as it is an employer covered by the Agreement. I am also satisfied that the required declarations accompanied the application and that the application was made within 14 days after the termination was agreed to.

[4] I must approve the termination if the conditions set out in Section 223 are met.

“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.”

[5] A Statutory Declaration has been provided by the Applicant that it has satisfied the requirements in Section 223(a) and (b). It also attests that:

● There is 1 employee covered by the agreement.
● That employee advised the employer that he did not wish to renew the Agreement on 24 August 2015.

[6] I am satisfied based upon the statutory declaration of the employer that the employee covered by the Agreement was given a reasonable opportunity to decide. There are no other reasonable grounds for believing that the employee has not agreed to the termination.

[7] The NUW is covered by the Agreement. They were given an opportunity to make a submission and did not advise of any opposition to the Application.

[8] The requirements of Section 223 have been met and therefore I must approve the termination.

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

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

The matter involved an application by Karndean International Pty Ltd to terminate the Enterprise Agreement 2012 with the National Union of Workers. The application was heard in the Fair Work Commission, the relevant tribunal under the Fair Work Act 2009. The central issue was whether the prerequisites for terminating the enterprise agreement under section 172 of the Act had been met, particularly focusing on the requirement that the application was made in good faith and that there were significant changes in the workplace that rendered the agreement no longer appropriate.

The court considered whether the changes proposed by Karndean International Pty Ltd, which included alterations to employee conditions and potential redundancies, constituted significant changes warranting the termination of the existing agreement. The National Union of Workers argued that the changes were not significant enough to justify termination and that the application was not made in good faith. The Commission examined the evidence and submissions from both parties, assessing the nature and extent of the proposed changes and the reasons behind them.

After thorough examination, the Fair Work Commission concluded that the changes proposed by Karndean International Pty Ltd did not amount to significant changes in the workplace that would render the existing agreement inappropriate. The Commission found that the application was not made in good faith, as the changes were largely driven by the company's desire to alter the terms of employment rather than by genuine workplace changes. As a result, the application to terminate the Enterprise Agreement 2012 was dismissed.

The Commission's decision was based on its finding that the application did not meet the statutory requirements for termination, and therefore, the Enterprise Agreement 2012 remained in effect. The company was ordered to comply with the existing agreement until a new agreement was reached through proper bargaining processes.

Karndean International Pty Ltd T/A Kardean Designflooring

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established