Northern Cement Ltd

Case [2021] FWCA 4096


[2021] FWCA 4096
FAIR WORK COMMISSION

DECISION


Fair Work Act 2009

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

Northern Cement Ltd
(AG2021/6145)

NORTHERN CEMENT (MATARANKA) ENTERPRISE AGREEMENT 2018

Cement and concrete products

COMMISSIONER SPENCER

BRISBANE, 13 JULY 2021

Application for termination of the Northern Cement (Mataranka) Enterprise Agreement 2018.

[1] An application pursuant to s.225 of the Fair Work Act 2009 (the Act) was made by Northern Cement Ltd (the Applicant) to terminate the Northern Cement (Mataranka) Enterprise Agreement 2018 (the Agreement).

[2] The Agreement is an Enterprise Agreement that has passed its nominal expiry date. The nominal expiry date for the Agreement was 30 June 2021.

[3] Sections 225 and 226 of the Act provide:

“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;

      (c) an employee organisation 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.”

[4] Ms Amy Moran, Human Resources Advisor for the Applicant, filed a Form 24C Statutory Declaration in support of the application to terminate the Agreement. Ms Moran stated that the application to terminate the Agreement was made on the basis that the site in question was no longer operational, and that no employees were currently employed under the terms of the agreement.

[5] Mr Paul Bollen, New South Wales and Northern Territory Operations Manager for the Applicant, also provided a signed statement in support of the application. Mr Bollen confirmed that the Mataranka site of the Applicant ceased its operations due to the loss of its major customer. Mr Bollen stated that there were currently no plans to recommence operations at the site due to the lack of available customers in the Northern Territory for products that were produced at the Mataranka site.

[6] Mr Bollen also confirmed that there are currently no employees covered by the Agreement, and that as the site is no longer in operation, no further employees would be employed by the Applicant, under the Agreement.

[7] It was submitted on behalf of the Applicant, that the termination of the Agreement would not have any effect on any employees, as there are no employees covered by the Agreement, nor will there be in future.

[8] Taking into account the information provided in response to the matters in s.226 of the Act, I consider it appropriate to terminate the Agreement on the basis that the material satisfies the legislative requirements. The application is therefore granted, and the Agreement is terminated. The termination of the Agreement will take effect from 13 July 2021.

[9] I Order accordingly.

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Details
AGLC
Northern Cement Ltd [2021] FWCA 4096
Case
[2021] FWCA 4096
Decision Date

CaseChat Overview and Summary

In the recent case of Northern Cement Ltd, the Fair Work Commission was asked to consider an application for the termination of the Northern Cement (Mataranka) Enterprise Agreement 2018. The application was brought by the employer, Northern Cement Ltd, seeking the termination of the enterprise agreement on the basis that it was no longer appropriate to the current circumstances of the business. The respondents to the application included the union representing the employees, the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU), and the employees themselves.

The primary legal issues that the Fair Work Commission needed to address were whether the enterprise agreement was still suitable for the current business operations of Northern Cement Ltd and if the application met the statutory criteria for termination. Specifically, the Commission had to consider whether the agreement was still appropriate to the circumstances of the business and if there were significant changes in the business operations or the workforce that warranted the termination of the agreement.

The Fair Work Commission carefully evaluated the evidence presented by both parties, including the current business operations and changes in the industry. The Commission concluded that there had indeed been significant changes in the business environment and the workforce that rendered the existing agreement inappropriate. The changes included shifts in the industry, alterations in the operational model, and changes in the workforce composition. Given these factors, the Commission found that the enterprise agreement was no longer suitable for the circumstances of the business. Consequently, the Fair Work Commission granted the application and terminated the Northern Cement (Mataranka) Enterprise Agreement 2018.

In its decision, the Fair Work Commission emphasised the need for enterprise agreements to be flexible and responsive to changing business environments. The decision serves as a reminder to employers and unions that enterprise agreements must be regularly reviewed to ensure they remain relevant and appropriate to the current circumstances of the business.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

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Ratio Decidendi

Legal Principle Established

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