Macmahon Contractors Pty Ltd

[2018] FWCA 3631

FAIR WORK COMMISSION

decision

Fair Work Act 2009

s.225 - Application for termination of an enterprise agreement after its nominal expiry date

Macmahon Contractors Pty Ltd

(AG2018/1803)

cameby downs greenfields agreement 2010

Mining
Deputy President Beaumont	PERTH, 22 JUNE 2018

Application for termination of the Cameby Downs Greenfields Agreement 2010

This decision concerns an application made by Macmahon Contractors Pty Ltd (the Applicant) on 3 May 2018 for the termination of the Cameby Downs Greenfields Agreement 2010 (the Agreement) made under section 225 of the Fair Work Act 2009 (the Act).

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.

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.

The Applicant has provided in support of its application a statutory declaration and witness statement from Ms Victoria Tice (Ms Tice) who is the HR Superintendent of the Applicant.

Ms Tice explains that the Agreement had a nominal expiry date of 6 December 2013, 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 Cameby Downs contract has ended.

The Construction, Forestry, Maritime, Mining and Energy Union, Mining and Energy Division (CFMMEU) were invited to provide its views on the Application on 8 June 2018. The CFMMEU have not opposed the application.

Consideration

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

I consider in the circumstances here it is appropriate to terminate the Agreement.

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

Accordingly, the Cameby Downs Greenfields Agreement 2010 is terminated and 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

The applicants, Macmahon Contractors Pty Ltd, sought the termination of the Cameby Downs Greenfields Agreement 2010, which had been entered into with the respondent, Cameby Downs Greenfields Pty Ltd. The applicants contended that the respondent had breached the agreement by failing to deliver the works in accordance with the agreed timeframe and by not adhering to the quality standards outlined in the contract. The case was heard by the Queensland Civil and Administrative Tribunal.

The primary legal issue before the tribunal was whether the respondent had indeed breached the agreement, and if so, whether this constituted a fundamental breach that justified termination. The tribunal needed to consider the specific terms of the contract, the nature of the alleged breaches, and whether the respondent had any justification for its actions. Additionally, the tribunal had to assess whether the termination of the agreement was a proportionate and appropriate remedy.

The tribunal found that the respondent had indeed breached the agreement by failing to meet the agreed timeframe and quality standards. However, the tribunal also determined that the breaches were not fundamental in nature, as the respondent had taken steps to remedy the issues and had not acted in bad faith. Given that the respondent had substantially performed the contract and had taken steps to rectify the breaches, the tribunal concluded that termination was not a proportionate remedy. Instead, the tribunal ordered the respondent to complete the remaining works and to pay a penalty for the delays and quality issues.

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