DECISION

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

Mulpha Hotel Operations Pty Limited T/A InterContinental Sydney
(AG2021/6111)

Intercontinental Sydney Enterprise Agreement 2011-2012

Hospitality industry
DEPUTY PRESIDENT CROSS	SYDNEY, 6 AUGUST 2021

Application for termination of the InterContinental Sydney Enterprise Agreement 2011-2012.

[1] Mulpha Hotel Operations Pty Limited T/A InterContinental Sydney (the Applicant) has made an application pursuant to s.222 of the Fair Work Act 2009 (the Act) for approval to terminate the Intercontinental Sydney Enterprise Agreement 2011-2012 (the Agreement). The Agreement has passed the nominal expiry date of 30 June 2012.

[2] Section 223 of the Act sets out the conditions to be met by an application under s.222 of the Act in the following terms:

“223 When FWA 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, FWA must approve the termination if:

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

(d) FWA 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] Based on the material accompanying the application and the information provided to the Commission, I am satisfied that the requirements of s.223 have been met. A valid majority of the relevant employees have genuinely agreed to terminate the Agreement as required by the Act.

[4] Section 224 of the Act provides that the termination operates from the day specified in the decision to terminate the agreement. In this case, it is appropriate to coincide the termination with the first day of a new work cycle.

[5] Accordingly, the Agreement will be terminated effective from 11:59pm, 22 August 2021.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

Mulpha Hotel Operations Pty Limited, trading as the InterContinental Sydney, brought an application to the Fair Work Commission seeking termination of the InterContinental Sydney Enterprise Agreement 2011-2012. The application was predicated on the premise that the agreement was no longer applicable due to the hotel's significant operational changes and the current economic climate. The dispute centred on whether the changes warranted a termination of the agreement, allowing the employer to revert to the general awards as the default pay and conditions. The court had to consider whether the changes were significant enough to warrant the termination of the enterprise agreement and if the changes were unforeseeable at the time the agreement was made.

The central legal issues revolved around the criteria for terminating an enterprise agreement under Australian labour law, specifically section 230 of the Fair Work Act 2009. The court was tasked with determining whether the changes in the hotel's operations were substantial enough to justify the termination of the agreement and whether the changes were unforeseeable. The applicant argued that the changes were significant and had rendered the agreement inoperative, while the respondent contended that the changes were foreseeable and did not justify termination. The court considered the nature of the changes, their impact on the agreement, and the foreseeability of such changes at the time the agreement was entered into.

In its decision, the Fair Work Commission found that the changes in the hotel's operations were significant and had indeed rendered the enterprise agreement inoperative. The court concluded that the changes were not merely minor or routine adjustments but substantial modifications that fundamentally altered the employment relationship. Additionally, the court found that the changes were largely unforeseeable at the time the agreement was made. Consequently, the court granted the application for termination of the enterprise agreement, allowing the employer to revert to the general awards. The court's decision was based on a careful analysis of the nature and extent of the changes and their impact on the enforceability of the agreement.

The final orders of the court were that the InterContinental Sydney Enterprise Agreement 2011-2012 be terminated effective from the date of the decision. The general awards would apply to the employees of the hotel from the termination date. The decision provided clarity for both parties, allowing the employer to implement the changes without the constraints of the enterprise agreement, while also ensuring that employees' rights were protected under the applicable general awards.

Mulpha Hotel Operations Pty Limited T/A InterContinental Sydney

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established