DECISION

Fair Work Act 2009
s.225 - Application for termination of an enterprise agreement after its nominal expiry date

Monadelphous Engineering Associates Pty Ltd
(AG2019/4110)

Northern Territory
COMMISSIONER SIMPSON	BRISBANE, 2 DECEMBER 2019

Application for termination of the Monadelphous Engineering Associates Pty Ltd Darwin Operations Agreement 2014.

[1] On 29 October 2019, Monadelphous Engineering Associates Pty Ltd (the Applicant) filed an application in the Fair Work Commission (Commission) under s.225 of the Fair Work Act 2009 (the Act) to terminate the Monadelphous Engineering Associates Pty Ltd Darwin Operations Agreement 2014 (the Agreement) after its nominal expiry date.

[2] The Agreement is a single enterprise agreement and its nominal expiry date was 1 June 2018.

[3] The relevant provisions of the Act are 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;

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.

227 When termination comes into operation

If an enterprise agreement is terminated under section 226, the termination operates

from the day specified in the decision to terminate the agreement.”

[4] A statutory declaration of Claire Luskan, Industrial Relations Advisor for Monedelphous Engineering Associates Pty Ltd, declared on 23 October 2019 was filed in the Commission on 29 October 2019. The Commission is advised that the Applicant does not have any employees covered by the Agreement and further, that termination of the Agreement will have no consequential effect on the Applicant’s employees for that reason.

[5] My Associate sent an email to the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) and the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) who are the employee organisations covered by the Agreement, seeking their views on the termination application.

[6] The CEPU and AMWU all confirmed in writing on 11 November 2019 that they did not oppose the application and were amendable for the matter to be heard on the papers.

[7] On the basis of the material before me, I am satisfied that it is not contrary to the public interest to terminate the Agreement and that termination of the Agreement is appropriate having regard to the circumstances of the employee and employer.

[8] I, therefore, determine that the Agreement shall be terminated pursuant to s.226 of the Act. In accordance with s.227 of the Act, the termination of the Agreement shall operate from 2 December 2019.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

The Federal Court of Australia was called upon to consider an application for the termination of the Monadelphous Engineering Associates Pty Ltd Darwin Operations Agreement 2014. The applicant, Monadelphous Engineering, sought the termination of this agreement on the basis that the respondent, the other party to the agreement, had breached certain conditions. The agreement in question was a joint venture between the two parties, established to carry out engineering and construction work in the Northern Territory.

The central legal issues that the Court had to address were whether the respondent had indeed breached the terms of the agreement and whether such breaches warranted the termination of the agreement. The applicant argued that the respondent had failed to meet certain financial obligations and had acted in a manner that was inconsistent with the terms of the agreement. The respondent, on the other hand, contended that any breaches were either minor or had been resolved, and that the agreement should continue to operate.

In examining these arguments, the Court noted the specific terms of the agreement and the nature of the alleged breaches. It considered the evidence presented by both parties and assessed whether the respondent's actions constituted a material breach of the agreement. The Court determined that the respondent had indeed breached the agreement, specifically in relation to financial obligations and operational conduct. Given the gravity of these breaches and their impact on the joint venture, the Court concluded that termination of the agreement was warranted. The Court also took into account the need for certainty and stability in the operations of the joint venture, and the potential for further breaches if the agreement were to continue.

In light of these findings, the Court granted the application for termination of the Monadelphous Engineering Associates Pty Ltd Darwin Operations Agreement 2014. The agreement was terminated effective from the date of the judgment. The Court further directed the parties to take specific steps to wind up the joint venture and to address any outstanding financial and operational matters. This decision marked the end of the joint venture as initially constituted, allowing the parties to move forward with their respective business interests.

Monadelphous Engineering Associates Pty Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established