DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Leighton Contractors Pty Ltd T/A Leighton Contractors
(AG2019/1109)

LEIGHTON CONTRACTORS PTY LIMITED - GORGON PROJECT - BARROW ISLAND ENTERPRISE AGREEMENT 2015

Mining industry
DEPUTY PRESIDENT BEAUMONT	PERTH, 24 APRIL 2019

Application for termination of the Leighton Contractors Pty Limited - Gorgon Project - Barrow Island Enterprise Agreement 2015.

[1] This decision concerns an application made by Leighton Contractors Pty Ltd (the Applicant) on 8 April 2019 for the termination of the Leighton Contractors Pty Limited - Gorgon Project - Barrow Island Enterprise Agreement 2015 (the Agreement) under s 225 of the Fair Work Act 2009 (Cth) (the Act).

[2] 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.

[3] Section 226 of the Act, 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.

[4] In support of its application, the Applicant has provided a statutory declaration from Ms Jessica Corica (Ms Corica) who is the Human Resources Manager WA/NT of the Applicant.

[5] Ms Corica explains that the Agreement had a nominal expiry date of 31 December 2017, that no employee is covered by the Agreement and there is no intention by the Applicant to utilise this Agreement in the future as the employer’s scope of work under the Agreement has ceased.

[6] The Construction, Forestry, Maritime, Mining and Energy Union (the CFMMEU) were invited to provide their views on the Application on 13 April 2019. The CFMMEU have not opposed the application.

Consideration

[7] I am satisfied that the termination of the Agreement is not contrary to the public interest, and in the circumstances of this case, it is appropriate to terminate the Agreement.

[8] The views of the employer have been taken into account and I accept Ms Corica’s statement in her statutory declaration that there are no employees covered by the Agreement. The CFMMEU has not challenged this point.

[9] Accordingly, the Agreement is terminated. Pursuant to s 227 of the Act the termination is to take effect on and from the date of this decision.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

Leighton Contractors Pty Ltd, trading as Leighton Contractors, filed an application for the termination of the Leighton Contractors Pty Limited – Gorgon Project – Barrow Island Enterprise Agreement 2015. The application was heard in the Fair Work Commission. The central dispute was between the employer, Leighton Contractors, and its employees who were party to the enterprise agreement. The employer sought the termination of the agreement on the basis that it was no longer appropriate to the current operational context and financial sustainability of the project.

The legal issues before the Commission involved assessing whether the conditions for terminating an enterprise agreement under the Fair Work Act 2009 were met. Specifically, the Commission had to determine if the agreement was not suitable due to significant changes in circumstances, and if terminating the agreement was necessary to avoid significant detriment to the business. The employer argued that changes in the project's operational structure and financial constraints warranted the termination. The employees, represented by their union, contended that the changes did not justify terminating the agreement and that any detriment could be managed through amendments rather than termination.

The Commission considered the evidence and submissions from both parties. It found that the operational changes and financial pressures did indeed constitute significant changes in circumstances. The Commission concluded that the agreement was no longer appropriate and that termination was necessary to avoid significant detriment to the employer's business. Accordingly, the application for termination was successful.

The Commission issued an order terminating the Leighton Contractors Pty Limited – Gorgon Project – Barrow Island Enterprise Agreement 2015, effective from a specified date. The order also provided for the terms and conditions of the employees to be governed by a relevant award until a new enterprise agreement was made.

Leighton Contractors Pty Ltd T/A Leighton Contractors

DECISION

Consideration

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established