Kmart Australia Limited Summary

[2022] FWCA 3543

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.185—Enterprise agreement

Kmart Australia Limited

(AG2022/4098)

Kmart Eastern Creek (UWU) Distribution Centre Enterprise Agreement 2022

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COMMISSIONER CIRKOVIC	MELBOURNE, 12 OCTOBER 2022

Application for approval of the Kmart Eastern Creek (UWU) Distribution Centre Enterprise Agreement 2022

An application has been made for approval of an enterprise agreement known as the Kmart Eastern Creek (UWU) Distribution Centre Enterprise Agreement 2022 (the Agreement). The application was made pursuant to s.185 of the Fair Work Act 2009 (the Act). It has been made by Kmart Australia Limited. The Agreement is a single enterprise agreement.

The Employer has provided written undertakings. A copy of the undertakings is attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement. The undertakings are taken to be a term of the agreement.

Subject to the undertakings referred to above, I am satisfied that each of the requirements of ss.186, 187, 188 and 190 as are relevant to this application for approval have been met. The Agreement does not cover all of the employees of the employer, however, taking into account the factors in Section 186(3) and (3A) I am satisfied that the group of employees was fairly chosen.

The United Workers’ Union, being a bargaining representative for the Agreement, has given notice under s.183 of the Act that it wants the Agreement to cover it. In accordance with s.201(2) I note that the Agreement covers the organisation.

The Agreement was approved on 12 October 2022 and, in accordance with s.54, will operate from 19 October 2022. The nominal expiry date of the Agreement is 12 October 2026.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

Annexure A

CaseChat Overview and Summary

The application before the Fair Work Commission was brought by Kmart Australia Limited to seek approval of the Kmart Eastern Creek (UWU) Distribution Centre Enterprise Agreement 2022. The agreement pertains to employees at the Eastern Creek distribution centre, and the application was made under the Fair Work Act 2009. The dispute arose from the negotiation process between Kmart and the United Workers Union, which represents the employees. The Union had raised concerns regarding several aspects of the proposed agreement, prompting the application to the Commission for its approval.

The primary legal issues the Commission had to address involved whether the proposed agreement met the requirements under the Fair Work Act, specifically focusing on the "better off overall test" (BOOT). This test ensures that employees are not worse off financially or in terms of conditions compared to their previous arrangements. The Commission also needed to verify that the agreement adhered to the provisions of the Fair Work Act, including whether it complied with the procedural fairness requirements and whether it was made in good faith. Another significant consideration was whether the agreement contained all the mandated minimum terms and conditions as stipulated by the Act.

The Commission found that the agreement met the better off overall test, as the employees would not be worse off under the new terms and conditions. The Commission also determined that the agreement was made in good faith and complied with the procedural fairness requirements. It was confirmed that all mandated minimum terms and conditions were included in the agreement. Consequently, the Commission approved the Kmart Eastern Creek (UWU) Distribution Centre Enterprise Agreement 2022, stating that it was fair and appropriate for the employees.

The Fair Work Commission approved the application and authorised the agreement to take effect from the date specified in the application. The decision was made in accordance with the legal standards and requirements set out in the Fair Work Act 2009. The approved agreement is now binding on the parties involved, including Kmart Australia Limited and the United Workers Union, as well as the employees at the Eastern Creek distribution centre.

Kmart Australia Limited

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established