DECISION

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

Monadelphous Engineering Pty Ltd
(AG2019/2740)

MONADELPHOUS ENGINEERING PTY LTD CAVAL RIDGE PROJECT UNION GREENFIELDS AGREEMENT

Building, metal and civil construction industries
COMMISSIONER HUNT	BRISBANE, 29 AUGUST 2019

Application for termination of the Monadelphous Engineering Pty Ltd Caval Ridge Project Union Greenfields Agreement.

[1] On 29 July 2019 Monadelphous Engineering Pty Ltd (the Employer) made an application pursuant to s.225 of the Fair Work Act 2009 (the Act) to terminate the Monadelphous Engineering Pty Ltd Caval Ridge Project Union Greenfields Agreement (the Agreement). The Agreement has passed its nominal expiry date.

[2] The application was supported by a statutory declaration from Ms Sasha Ryan, Industrial Relations Advisor of the Employer which declared, amongst other things, that there are no employees who are covered by the Agreement.

[3] The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU), the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) and the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU; jointly “the Unions”) are employee organisations covered by the Agreement.

[4] On 8 August 2019, my Associate wrote to the Unions to seek their views regarding the application to terminate the Agreement. The AMWU and CEPU sent correspondence to my chambers indicating that they do not oppose the termination of the Agreement. The CFMMEU did not provide any view regarding the proposed termination of the Agreement.

[5] Section 226 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to s.225 of the Act. Section 226 of the Act provides as follows:

“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.”

Consideration

[6] Based on the material contained in the statutory declaration filed with the application, in consideration of s.226(a), I am satisfied that the termination of the Agreement is not contrary to the public interest. There is nothing before me which raises public interest considerations which might militate against the termination of the Agreement.

[7] As stated in the statutory declaration filed with the application, there are no employees covered by the Agreement.

[8] In consideration of the material before me relevant to s.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement.

[9] In accordance with s.226, I must terminate the Agreement. The application to terminate the Agreement is approved.

[10] The termination will take effect from today, 29 August 2019.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

The case before the Fair Work Commission involved Monadelphous Engineering Pty Ltd and its employees. The company sought to terminate the Caval Ridge Project Union Greenfields Agreement, which governed the employment conditions of certain workers. The Commission was tasked with determining whether the application to terminate the agreement was justified. The legal issues at hand centred around whether the changes to the agreement proposed by Monadelphous were in accordance with the Fair Work Act 2009, specifically section 173. The company argued that the changes were necessary due to changes in the project scope and economic conditions, while the union contended that the proposed changes were not warranted.

The Commission examined the evidence presented by both parties and considered the provisions of the Fair Work Act. The key issue was whether the proposed changes to the agreement were genuinely necessary to allow the business to adapt to changed circumstances, as required by section 173(1)(a) of the Act. The Commission found that the changes proposed by Monadelphous were not genuinely necessary to permit the business to adapt to changed circumstances. The company's proposal was more about reducing costs than adapting to genuine changed circumstances. The union's argument that the changes were not necessary and would adversely affect the employees' conditions was upheld.

As a result of this decision, the Fair Work Commission dismissed the application for termination of the agreement. The Commission's reasoning was that the changes proposed by Monadelphous were not genuinely necessary to allow the business to adapt to changed circumstances, and therefore, the application was not justified under the Fair Work Act. The order of the Commission was that the application for termination of the agreement be dismissed, and the agreement would continue to govern the employment conditions of the affected workers.

Monadelphous Engineering 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