Leonda Receptions Pty Ltd T/A Leonda By The Yarra

Case [2021] FWCA 7102


[2021] FWCA 7102
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

Leonda Receptions Pty Ltd T/A Leonda By The Yarra
(AG2021/8447)

LEONDA BY THE YARRA EMPLOYEE COLLECTIVE AGREEMENT

Hospitality industry

DEPUTY PRESIDENT HAMILTON

MELBOURNE, 14 DECEMBER 2021

Application for termination of the Leonda by the Yarra Employee Collective Agreement 2007-2009

[1] On 18 November 2021, Leonda Receptions Pty Ltd T/A Leonda by the Yarra applied for the termination of the Leonda by the Yarra Employee Collective Agreement 2007-2009 (the Agreement), under Schedule 3, Item 16 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (the TPCA Act).

[2] Schedule 3, Item 16 of the TPCA Act provides that Subdivision D of Division 7 of Part 2-4 of the Fair Work Act 2009 (Cth) (the Act) applies in relation to a collective agreement-based transitional instrument as if a reference to an enterprise agreement included a reference to a collective agreement-based transitional instrument.

[3] I am satisfied that the Agreement is a collective agreement-based transitional instrument and that it passed its nominal expiry date in November 2012.

[4] The Act provides as follows:

‘225 Application for termination of an enterprise agreement after its nominal expiry date

If an enterprise agreement has passed its nominal expiry date, any of the following may apply to the FWC for the termination of the agreement:

(a) one or more of the employers covered by the agreement;

(b) an employee covered by the agreement;

(c) an employee organisation covered by the agreement.

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] Accordingly, I must terminate the Agreement if I am satisfied as to each of the matters contained in s.226 of the Act.

[6] A Notice of Listing and Directions were issued on 22 November 2021 listing the matter for Non-Attendance Hearing on 14 December 2021. The Applicant was directed to provide a copy of the application with its supporting documentation, and a copy of the Commission’s Directions, to all employees covered by the Agreement, or to confirm via return email that there were no employees employed under the Agreement. The Applicant confirmed that it had notified all employees and provided proof of this notification to the Commission via email on 26 November 2021. The Notice of Listing directed any party seeking to oppose the application to contact Chambers. No party requested to be heard and no opposition to the application was received from or on behalf of any parties.

[7] Based on the application and the material before me, I am satisfied that termination of the Agreement is not contrary to the public interest. Taking into account all of the circumstances including those in ss.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement. There is nothing before me that raises public interest considerations which might lead me to conclude that the Agreement should not be terminated.

[8] I am satisfied that it is appropriate to terminate the Agreement, and I do so.

[9] The termination will come into effect from the date of this decision.

DEPUTY PRESIDENT HAMILTON

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Details
AGLC
Leonda Receptions Pty Ltd T/A Leonda By The Yarra [2021] FWCA 7102
Case
[2021] FWCA 7102
Decision Date

CaseChat Overview and Summary

Leonda Receptions Pty Ltd, trading as Leonda by the Yarra, applied for termination of the Leonda by the Yarra Employee Collective Agreement 2007-2009. The applicants sought termination on the basis of a significant change in circumstances, as defined in the Fair Work Act 2009. The applicants argued that the agreement could no longer be maintained due to substantial changes in the business environment, leading to a significant financial strain on the company. The Fair Work Commission heard the application, focusing on whether the changes in circumstances were sufficient to warrant the termination of the existing agreement.

The legal issues before the Fair Work Commission involved interpreting the criteria for a "significant change in circumstances" as outlined in the Fair Work Act 2009. The Commission had to determine if the changes in the business environment were substantial enough to render the existing agreement unworkable. This required an analysis of the applicants' financial position, the terms of the existing agreement, and the impact of the alleged changes on the ability of the company to meet its obligations under the agreement.

The Fair Work Commission examined the evidence provided by the applicants and concluded that the changes in the business environment were indeed significant. The Commission found that the financial strain experienced by the applicants was severe and persistent, affecting their ability to fulfil the obligations under the collective agreement. The Commission also considered the impact of these changes on the employees and the potential for the agreement to be adjusted to accommodate the new circumstances. Ultimately, the Commission determined that the significant changes in circumstances warranted the termination of the existing agreement, as the applicants were unable to maintain the terms of the agreement in light of the substantial financial difficulties they faced.

The Fair Work Commission terminated the Leonda by the Yarra Employee Collective Agreement 2007-2009, effective from the date of the decision. The Commission also ordered that the termination of the agreement would not result in the loss of any entitlements or rights accrued by the employees under the existing agreement. The applicants were required to provide written notice of the termination to all affected employees and to the relevant union. The Commission's decision provided clarity on the interpretation of the "significant change in circumstances" provision, ensuring that the parties could move forward with a revised agreement that better reflected the current business environment.

Orders

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Background

Background to the litigation

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Evidence

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Decision

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