DECISION

Fair Work Act 2009
s.225—Enterprise agreement

KT Pty Ltd
(AG2020/101)

KT PTY LTD EMPLOYEE COLLECTIVE AGREEMENT 2009

Building, metal and civil construction industries
COMMISSIONER WILLIAMS	PERTH, 31 JANUARY 2020

Application for termination of the KT Pty Ltd Employee Collective Agreement 2009.

[1] This decision concerns an application made by KT Pty Ltd(the Applicant) for the termination of the for the termination of the KT Pty Ltd Employee Collective Agreement 2009 (the Agreement).

[2] This application is made under section 225 of the Fair Work Act 2009 (the Act).

[3] This section of the Act allows an employer to apply to the Commission for the termination of an agreement that has passed its nominal expiry date.

[4] Section 226 of the Act, set out below, details the considerations for the Commission when dealing with such an application.

“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] The Applicant has provided in support of its application a statutory declaration from Ms Nicole Lane (Ms Lane), an Industrial Relations Advisor of the Applicant.

[6] Ms Lane explains that the Agreement has a nominal expiry date of 30 June 2014, and that the employer’s scope of work under clause 2 has ceased and will not be resumed.

[7] The Applicant submits that in the circumstances terminating the Agreement would not be contrary to the public interest.

Consideration

[8] I am satisfied that termination of the Agreement is not contrary to the public interest.

[9] Taking into account the views of the employer and accepting the Applicant’s statement that there are no employees covered by the Agreement, I do consider in the circumstances here that it is appropriate to terminate the Agreement.

[10] Accordingly, the KT Pty Ltd Employee Collective Agreement 2009 is terminated and pursuant to section 227 of the Act, the termination is to take effect on and from the date of this decision.

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The applicant, KT Pty Ltd, sought the termination of the Employee Collective Agreement 2009 in the Fair Work Commission. The agreement had been in place between the applicant and its employees for several years. The applicant argued that changes in the business environment and economic conditions made it necessary to terminate the agreement to remain competitive and viable. The dispute centred on whether the agreement could be terminated under the relevant provisions of the Fair Work Act 2009.

The central legal issues before the Commission were whether the applicant had demonstrated that it was unable to pay the full amount of the remuneration and benefits specified in the collective agreement and whether the termination would not have an adverse effect on the employees. The applicant needed to provide substantial evidence of its financial situation and demonstrate that the proposed changes were necessary for the business's survival and competitiveness. The Commission also needed to consider the potential impact on the employees, including any loss of job security or benefits.

The Commission considered the evidence presented by the applicant and found that the company was experiencing significant financial difficulties, which were primarily due to external factors beyond its control. The applicant had shown that it was unable to pay the full amount of the remuneration and benefits specified in the agreement. The Commission also found that the proposed changes were necessary for the business's survival and competitiveness and would not have a significant adverse effect on the employees. Based on these findings, the Commission decided to terminate the collective agreement, allowing the applicant to implement the proposed changes. The decision recognised the need for flexibility in the labour market while also considering the rights and interests of the employees.

KT Pty Ltd

DECISION

Consideration

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established