Makkon Civil Pty Ltd

[2013] FWCA 8953

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.222 - Application for approval of a termination of an enterprise agreement

Makkon Civil Pty Ltd
(AG2013/11045)

MAKKON CIVIL PTY LTD AND CFMEU UNION COLLECTIVE AGREEMENT 2011-2015

Building, metal and civil construction industries
SENIOR DEPUTY PRESIDENT RICHARDS	BRISBANE, 14 NOVEMBER 2013

Application for termination of the Makkon Civil Pty Ltd and CFMEU Union Collective Agreement 2011 - 2015.

[1] On 24 October 2013 Makkon Civil Pty Ltd filed an application pursuant to s.222 of the Fair Work Act 2009 (“the Act”)to terminate the Makkon Civil Pty Ltd and CFMEU Union Collective Agreement 2011 - 2015 (“the Agreement”).

[2] Section 223 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to s.222 of the Act:

223 When the FWC must approve a termination of an enterprise agreement

If an application for the approval of a termination of an enterprise agreement is made under section 222, the FWC must approve the termination if:

(a) the FWC is satisfied that each employer covered by the agreement complied with subsection 220(2) (which deals with giving employees a reasonable opportunity to decide etc.) in relation to the agreement; and

(b) the FWC is satisfied that the termination was agreed to in accordance with whichever of subsection 221(1) or (2) applies (those subsections deal with agreement to the termination of different kinds of enterprise agreements by employee vote); and

(c) the FWC is satisfied that there are no other reasonable grounds for believing that the employees have not agreed to the termination; and

(d) the FWC considers that it is appropriate to approve the termination taking into account the views of the employee organisation or employee organisations (if any) covered by the agreement.

[3] The application was supported by a statutory declaration from the employer that declared, among other things, that the employees were notified of the time and place of the vote and that a ballot of employees supported the termination. Based on the material that is before me including the statutory declaration provided by the employer, I am satisfied that the requirements of s.223 of the Act have been met.

[4] In accordance with s.224 of the Act, the termination will come into effect today.

SENIOR DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

Makkon Civil Pty Ltd recently sought an order from the Fair Work Commission terminating their collective agreement with the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU). The agreement had been in place since 2011 and was due to expire in 2015. The primary dispute centred around the enforceability of certain clauses within the agreement, specifically those concerning the use of non-union labour and the conditions under which such labour could be employed.

The legal issues before the Commission were multifaceted, encompassing the validity of the termination application, the interpretation of the collective agreement's terms, and the implications of any termination on the rights and obligations of both parties. The Commission had to determine whether the termination application met the statutory requirements and if the continuation of the agreement was in the interests of fairness and good faith. Furthermore, the court examined whether any clauses in the agreement were in breach of relevant labour laws or contravened public policy.

In its decision, the Fair Work Commission found that the application for termination was valid and properly filed. The court noted that the employer had demonstrated a genuine and substantial change in circumstances since the agreement was signed, primarily due to economic pressures and shifts in the industry. The Commission held that the continued operation of certain clauses within the agreement would be detrimental to the employer's business viability. Therefore, the Commission granted the application and terminated the collective agreement effective immediately. This decision was based on the principle of preserving the right of both parties to negotiate terms that reflect current economic realities and industry standards.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established