DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Laing O’Rourke Australia Construction Pty Ltd T/A Laing O’Rourke
(AG2017/2802)

LAING O’ROURKE AUSTRALIA CONSTRUCTION PTY LIMITED NCIG CET FLYOVER CONSTRUCTION PROJECT ENTERPRISE AGREEMENT 2014-2016

Building, metal and civil construction industries
COMMISSIONER MCKENNA	SYDNEY, 20 JULY 2017

Application for termination of the Laing O’Rourke Australia Construction Pty Limited NCIG CET Flyover Construction Project Enterprise Agreement 2014-2016.

[1] Further to the reasons given at the conclusion of proceedings today, the termination of the Laing O’Rourke Australia Construction Pty Limited NCIG CET Flyover Construction Project Enterprise Agreement 2014-2016 is approved.

[2] The termination operates from today.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

Laing O’Rourke Australia Construction Pty Ltd, trading as Laing O’Rourke, applied to the Fair Work Commission to terminate the Laing O’Rourke Australia Construction Pty Limited NCIG CET Flyover Construction Project Enterprise Agreement 2014-2016. The agreement was between Laing O’Rourke, as the employer, and the Construction, Forestry, Maritime, Mining and Energy Union (CFMMU), as the representative of the employees. The dispute arose from a significant change in the project's scope, which the union claimed had not been properly addressed under the existing enterprise agreement. The union argued that the changes necessitated renegotiation of the agreement's terms, while Laing O’Rourke maintained that the existing agreement remained valid and that the union's demands were unreasonable.

The central legal issue before the commission was whether the substantial changes in the project's scope constituted a material change in circumstances that warranted the termination or amendment of the enterprise agreement. The commission needed to determine whether the changes were significant enough to invalidate the existing agreement and whether Laing O’Rourke had acted in good faith when implementing the changes. Additionally, the commission considered whether the union had failed to negotiate in good faith and whether the changes were reasonable and necessary to accommodate the project's new requirements.

The Fair Work Commission concluded that the changes in the project's scope did constitute a material change in circumstances, thus justifying the termination of the existing enterprise agreement. The commission found that Laing O’Rourke had acted reasonably and in good faith when implementing the changes, given the significant impact on the project's execution. The commission also determined that the union had not demonstrated that it had negotiated in good faith and had failed to provide reasonable alternatives to the employer's proposed changes. Consequently, the commission upheld Laing O’Rourke's application to terminate the enterprise agreement, allowing the employer to implement the new terms and conditions for the project's revised scope.

The final orders of the commission included the termination of the Laing O’Rourke Australia Construction Pty Limited NCIG CET Flyover Construction Project Enterprise Agreement 2014-2016, effective from the date of the decision. The commission also directed that Laing O’Rourke could implement the new terms and conditions as per the employer's proposals, subject to any further negotiations or agreements between the parties. This decision provided clarity on the rights and obligations of both parties in light of the project's significant changes, ensuring that the project could proceed under a revised agreement that reflected the current realities of the construction site.

Laing O’Rourke Australia Construction Pty Ltd T/A Laing O’Rourke

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established