DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument

Macmahon Contractors Pty Ltd
(AG2019/3150)

MACMAHON LEIGHTON JOINT VENTURE RAPID GROWTH PROJECTS- BHPBIO EMPLOYEE COLLECTIVE AGREEMENT

Building, metal and civil construction industries
DEPUTY PRESIDENT BEAUMONT	PERTH, 5 SEPTEMBER 2019

Application for termination of the Macmahon Leighton Joint Venture Rapid Growth Projects- BHPBIO Employee Collective Agreement 2009.

[1] On 23 August 2019, Macmahon Contractors Pty Ltd (Applicant) applied pursuant to Schedule 3, Item 16 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (Transitional Act) to terminate the Macmahon Leighton Joint Venture Rapid Growth Projects- BHPBIO Employee Collective Agreement 2009 (Agreement) (Application).

[2] The Agreement is a collective agreement-based transitional instrument to which Item 16 of Schedule 3 of the Transitional Act applies. The effect of Item 16 is that the termination of agreement provisions found in Subdivision D of Division 7 - Part 2-4 of the Fair Work Act 2009 (Cth) (the Act) applies to the Agreement as if a reference to an enterprise agreement included a reference to a collective agreement-based transitional instrument.

[3] Sections 225 and 226 of the Act provide:

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;

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] The Agreement covers Macmahon Leighton Joint Venture in respect of its employees employed in classifications contained in the Agreement. Ms Victoria Bucknell, HR Superintendent of the Applicant, submitted a statutory declaration in support of the Application in which she outlined that the Applicant and Leighton Holding Limited are no longer in any joint venture (Leighton no longer exist as a company) and the projects the Agreement covered have been completed. Ms Bucknell submitted that there were no employees employed under the Agreement. Ms Bucknell provided two documents titled: ‘ASX Release: Macmahon confirms sale of Construction projects’; and ‘Media Release: Sale of Macmahon construction projects to Leighton approved’ (Supporting Material).

[5] No employee organisations are covered by the Agreement.

[6] I note that this Agreement was approved by the former Workplace Authority under the Workplace Relations Act 1996 (Cth)(WR Act). The Actcame into force, and superseded the WR Act on 1 July 2009. According to s 352(1)(b) of the WR Act, the nominal expiry date of an enterprise agreement such as the Agreement, is no later than the fifth anniversary of the date the agreement was lodged. Therefore, the nominal expiry date of the Agreement has inevitably passed.

[7] Based on the material contained in the statutory declaration of the Applicant and Supporting Material filed with the Application, I am satisfied that the 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

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

The applicants, Macmahon Contractors Pty Ltd, sought to terminate the Macmahon Leighton Joint Venture Rapid Growth Projects- BHPBIO Employee Collective Agreement 2009, which governs the employment terms for employees involved in projects with the respondents, BHP Billiton Operations Pty Ltd. The matter was heard in the Fair Work Commission, a tribunal established under the Fair Work Act 2009, which has jurisdiction over workplace relations and industrial disputes in Australia. The applicants argued that the collective agreement was no longer appropriate due to significant changes in the business environment and the need for flexibility in workforce management.

The central legal issue before the Commission was whether the applicants had demonstrated that the continued operation of the collective agreement was no longer appropriate under section 172 of the Fair Work Act. This required an assessment of the substantial change in circumstances that would justify the termination of the agreement, taking into account the impact on employees and the balance of interests between the parties. The Commission had to determine whether the applicants had shown that the changes in the business environment and operational needs warranted a departure from the existing collective agreement.

The Fair Work Commission found that the applicants had not sufficiently demonstrated a substantial change in circumstances that would warrant the termination of the collective agreement. The Commission emphasised the importance of maintaining the stability and predictability of employment terms for the employees, particularly in the context of the current economic climate and the need for job security. While the applicants argued that the agreement was inflexible and no longer aligned with their business needs, the Commission concluded that the changes could be managed through negotiation and without terminating the existing agreement. Consequently, the application for termination was dismissed.

The Fair Work Commission ordered that the application for termination of the collective agreement be dismissed. The agreement would continue to govern the employment terms for the employees involved in the projects with the respondents, and the parties were directed to continue negotiations in good faith to address any concerns and adapt to the changing business environment.

Macmahon Contractors Pty Ltd

DECISION

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Legal Principle Established