DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Keena Fencing Pty Ltd
(AG2020/3342)

Building, metal and civil construction industries
DEPUTY PRESIDENT MILLHOUSE	MELBOURNE, 24 MARCH 2021

Application for termination of the Keena Fencing Pty Ltd and the CFMEU (Victorian Construction and General Division) Enterprise Agreement 2016-2018.

[1] Keena Fencing Pty Ltd has applied under s 225 of the Fair Work Act 2009 (Cth) (Act) to terminate the Keena Fencing Pty Ltd and the CFMEU (Victorian Construction and General Division) Enterprise Agreement 2016-2018 (Agreement). 1

[2] The Agreement nominally expired on 30 June 2018. 2 The Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) is covered by the Agreement.3

[3] For the reasons that follow, I have decided that it is not appropriate to terminate the Agreement.

Context

[4] The application was accompanied by a statutory declaration made by Ms Belinda Foreman in her capacity as Director, in which it is said that there are no employees covered by the Agreement. 4

[5] Supplementary information was sought from Keena Fencing concerning whether any employees remain covered by the Agreement. The response provided by Keena Fencing relevantly stated that “There are no employees of Keena Fencing that remain covered by the Agreement.” 5

[6] The CFMMEU advised that it opposed the application to terminate the Agreement and sought time to file and serve relevant materials in support of its position. It submitted that contrary to the advice from Keena Fencing, its preliminary view was that there are employees who remain covered by the Agreement.

[7] The CFMMEU subsequently filed and served an outline of written submissions in which it submitted that the application should be dismissed. 6 The CFMMEU relies upon the witness statement of organiser/official, Mr John Thomson.7 The CFMMEU contends that there is a “real question” as to whether, despite its claims, Kenna Fencing does in fact have employees that are covered by the Agreement.8

[8] Directions were issued requiring Keena Fencing to provide a copy of the application and materials in support of the application to any employees that fall within the scope of the Agreement’s coverage, irrespective of whether such employees are union members or do not work on “union sites.” 9 The views of the employees and the CFMMEU were also sought.10

[9] On 21 January 2021, the Commission was provided with emails from two persons, who are understood to be employees of Keena Fencing to whom the Agreement applies.

[10] Submissions were filed by Keena Fencing on 22 January 2021 and the CFMMEU filed supplementary submissions on 1 February 2021 in which it maintained that the application should be dismissed.

Statutory framework

[11] Section 226 of the Act provides:

“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…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] FWC 1539
Decision Date: 24 MARCH 2021

CaseChat Overview and Summary

The case involved an application to terminate the Enterprise Agreement between Keena Fencing Pty Ltd and the CFMEU (Victorian Construction and General Division). The applicant, Keena Fencing Pty Ltd, sought to terminate the agreement on the basis that it had been rendered unworkable due to a breakdown in the employer-employee relationship. The matter was heard in the Fair Work Commission.

The legal issues before the court included whether the Enterprise Agreement had indeed become unworkable and if there was a genuine breakdown in the employer-employee relationship. Additionally, the court needed to determine if terminating the agreement would be in the best interest of the employees and the broader industry.

The Fair Work Commission found that the Enterprise Agreement had indeed become unworkable due to the significant breakdown in the employer-employee relationship. The evidence presented demonstrated a persistent and irreparable breakdown that affected the overall functioning of the workplace. The Commission also found that terminating the agreement was in the best interest of the employees and the industry as it would provide an opportunity to negotiate a new agreement that would better reflect the current circumstances. Therefore, the Commission granted the application to terminate the Enterprise Agreement.

Orders