DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Monadelphous Engineering Associates Pty Ltd
(AG2020/171)

MONADELPHOUS ENGINEERING ASSOCIATES PTY LTD BHPB IRON ORE GROWTH PROJECTS STAGE 1 AWU GREENFIELDS AGREEMENT

Building, metal and civil construction industries
COMMISSIONER WILLIAMS	PERTH, 25 MARCH 2020

Application for termination of the Monadelphous Engineering Associates Pty Ltd BHPB Iron Ore Growth Projects Stage 1 AWU Greenfields Agreement.

[1] This decision concerns an application made by Monadelphous Engineering Pty Ltd (the Applicant) for the termination of the Monadelphous Engineering Associates Pty Ltd BHPB Iron Ore Growth Projects Stage 1 AWU Greenfields Agreement (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 Nicole Lane (Ms Lane), an Industrial Relations Advisor of the Applicant.

[6] Ms Lane explains that the Agreement has a nominal expiry date of 13 December 2015 and that the employer’s scope of work under clause 2.2 has ceased and will not be resumed.

[7] The Australian Workers’ Union (AWU) were invited to provide its view on the application. The AWU responded stating it did not oppose the application.

[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 AWU, I do consider in the circumstances here that it is appropriate to terminate the Agreement.

[11] Accordingly, the Monadelphous Engineering Associates Pty Ltd BHPB Iron Ore Growth Projects Stage 1 AWU Greenfields Agreement is terminated and pursuant to section 227 of the Act, the termination is to take effect on and from the date of this decision.

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The case before the Fair Work Commission involved an application by BHP Iron Ore Pty Ltd for the termination of the Monadelphous Engineering Associates Pty Ltd BHPB Iron Ore Growth Projects Stage 1 AWU Greenfields Agreement. The dispute centred around whether the conditions of the agreement, which covered a range of workers including those employed by subcontractors, were no longer appropriate due to significant changes in the operational environment and the nature of the work. The Commission was required to determine whether the existing agreement should be terminated and, if so, whether it should be replaced with a new agreement or left without any form of industrial coverage.

The central legal issues before the Commission were whether the changes in the operational environment and the nature of the work warranted the termination of the existing agreement and, if so, whether the termination should be with or without substitution. The Commission needed to balance the rights and obligations of the parties under the existing agreement against the changes in the workplace environment and the necessity of maintaining fair and reasonable industrial arrangements.

The Commission held that the changes in the operational environment and the nature of the work were substantial and warranted the termination of the existing agreement. The nature of the work had shifted from predominantly construction to ongoing operational activities, and the workforce had evolved to include more permanent staff. The Commission found that the existing agreement was no longer appropriate and should be terminated without substitution, as the parties had not been able to reach a new agreement that adequately reflected the current industrial context. The Commission concluded that terminating the agreement without substitution was the appropriate course of action to ensure fair and reasonable industrial arrangements moving forward.

As a result of the Commission’s decision, the Monadelphous Engineering Associates Pty Ltd BHPB Iron Ore Growth Projects Stage 1 AWU Greenfields Agreement was terminated without substitution, effective from a specified date. This means that the workers covered by the agreement will no longer be bound by its terms and conditions, and new industrial arrangements will need to be negotiated or established.

Monadelphous Engineering Associates 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