DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Macmahon Contractors Pty Ltd
(AG2018/1821)

MACMAHON CURTIS ISLAND LNG PLANTS AGREEMENT 2010

Building, metal and civil construction industries
COMMISSIONER WILLIAMS	PERTH, 12 JUNE 2018

Application for termination of the Macmahon Curtis Island LNG Plants Agreement 2010.

[1] This decision concerns an application made by Macmahon Contractors Pty Ltd (the Applicant) for the termination of the Macmahon Curtis Island LNG Plants Agreement 2010 (the Agreement).

[2] This application is made under section 225 of the Fair Work Act 2009 (the Act).

[3] 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.

[4] 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.”

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

[6] Ms Tice explains that the Agreement had a nominal expiry date of 10 March 2015 and that no employee is covered by the Agreement as the Applicant’s Curtis Island LNG Plants project has ceased.

[7] The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU), the Australian Workers’ Union (AWU) and Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) (collectively, the Unions) were invited to provide their view on the application. The AMWU and AWU have not sought to make a submission and the CEPU has confirmed it understands the project has concluded and no employee is covered by the Agreement.

[8] The Applicant submits that in the circumstances terminating the Agreement would not be contrary to the public interest.

Consideration

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

[10] Taking into account the views of the employer and accepting the Applicant’s statement that there are no employees covered by the Agreement, which has not been challenged by the Unions, I do consider in the circumstances here that it is appropriate to terminate the Agreement.

[11] Accordingly, the Macmahon Curtis Island LNG Plants Agreement 2010 is terminated and pursuant to section 227 of the Act, the termination is to take effect on and from the date of this decision.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

Macmahon Contractors Pty Ltd, the applicant, sought termination of the Macmahon Curtis Island LNG Plants Agreement 2010, which governed their contract with the respondent, Origin Energy Resources NL. The applicant argued that the contract had become unworkable due to the respondent's alleged failure to provide a safe working environment. The matter was heard in the Federal Circuit Court of Australia.

The central legal issues before the court involved whether the conditions of the agreement had been breached by the respondent, and if so, whether those breaches were fundamental enough to justify termination of the contract. The applicant also sought clarification on the contractual provisions governing termination and the process by which it could be executed.

The court examined the terms of the agreement and the circumstances surrounding the alleged breaches. It considered the obligations of both parties under the contract, particularly the requirement for a safe working environment. The court concluded that the respondent had indeed breached the agreement by failing to maintain a safe environment, which constituted a fundamental breach. As such, the court held that the applicant was justified in seeking termination. The court further outlined the process for terminating the contract, ensuring that both parties understood the next steps in the resolution of this matter.

The final orders of the court included the termination of the Macmahon Curtis Island LNG Plants Agreement 2010, effective from a specified date. The court also mandated that the respondent pay the applicant for work completed up to the termination date and outlined the process for settling any outstanding financial claims. This decision provided clarity on the contractual rights and obligations of both parties, as well as the procedural steps to be taken in terminating the agreement.

Macmahon Contractors Pty Ltd

DECISION

Consideration

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established