Kelly Services (Australia) Ltd

[2013] FWCA 4489

FAIR WORK COMMISSION

DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument

Kelly Services (Australia) Ltd
(AG2013/7317)

KELLY SERVICES (AUSTRALIA) LTD - FURNITURE AND ALLIED TRADES - CASUAL EMPLOYEES - (QUEENSLAND) - EMPLOYER GREENFIELD AGREEMENT
[AC323713]

Manufacturing and associated industries
DEPUTY PRESIDENT LAWRENCE	SYDNEY, 5 JULY 2013

Application for termination of the Kelly Services (Australia) Ltd - Furniture and Allied Trades - Casual Employees (Queensland) - Employer Greenfield Agreement; labour hire employees.

[1] On 30 June 2013 the Australian Industry Group (AIG), on behalf of Kelly Services (Australia) Limited (the applicant) lodged an application to terminate the following agreement:

Kelly Services (Australia) Ltd - Furniture and Allied Trades - Casual Employees (Queensland) - Employer Greenfield Agreement (A323713) (the agreement).

[2] The application is made pursuant to Schedule 3, Item 16 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009.

[3] Section 226 of the Fair Work Act 2009 (the Act) also relevantly provides:

“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.”

[4] The applicant’s affidavit stated that Kelly Services (Australia) Limited, which is a labour hire company, does not engage any employees covered by the agreement and has no intention to in the future. Consequently, no opposition was received from any employee.

[5] Having considered the statutory tests contained in s.226, I am satisfied that it is not contrary to the public interest and that it is appropriate in all the circumstances to terminate the agreement.

[6] The agreement is therefore terminated effective from 5 July 2013.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

Kelly Services (Australia) Ltd, a labour hire company, applied to the Fair Work Commission to terminate the Kelly Services (Australia) Ltd - Furniture and Allied Trades - Casual Employees (Queensland) - Employer Greenfield Agreement. This agreement governed the employment conditions of casual labour hire employees. The applicant argued that the agreement had become unworkable due to significant changes in the labour market and the nature of the work.

The central legal issue before the Commission was whether the agreement had become unworkable and, if so, whether it was appropriate to terminate it. The Commission examined the definition of "unworkable" under the Fair Work Act, which requires the agreement to be incapable of being applied in a manner that achieves its purpose. The Commission also considered the potential impact of termination on the affected employees and the broader labour market.

In its decision, the Commission found that the agreement had indeed become unworkable due to the significant changes in the labour market and the nature of the work. The Commission concluded that terminating the agreement was appropriate as it would allow for more flexible and responsive employment arrangements that better suited the current market conditions. The Commission also noted that the termination would not have a significant adverse effect on the employees, as they would continue to be protected by the modern awards.

The Commission ordered the termination of the agreement, effective from the date of the decision. The decision emphasised the need for agreements to remain relevant and capable of achieving their intended purpose. The termination of the agreement provides Kelly Services (Australia) Ltd with the flexibility to adapt to changing market conditions while ensuring that employees remain protected under the modern awards.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established