Oakstilt Investments Pty Ltd T/A Dollars and Sense
[2023] FWCA 885
•23 MARCH 2023
| [2023] FWCA 885 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Item 16 Sch. 3—Termination of transitional instrument
Oakstilt Investments Pty Ltd T/A Dollars and Sense
(AG2023/404)
DOLLARS AND SENSE NEW SOUTH WALES (THE RETAILERS ASSOCIATION) EMPLOYEE COLLECTIVE AGREEMENT 2009
| Retail industry | |
| COMMISSIONER HUNT | BRISBANE, 23 MARCH 2023 |
Application for termination of The Retail Association Employees Collective Agreement #09624084 - NSW
On 22 February 2023, Oakstilt Investments Pty Ltd T/A Dollars and Sense (the Employer) made an application under Schedule 3, Item 16 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act) to terminate The Retail Association Employees Collective Agreement #09624084 - NSW (the Agreement). The Agreement passed its nominal expiry date in 2014.
The Agreement binds the Employer, covering retail employees. The Agreement is a zombie agreement. As a result of the passing of the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022, the Agreement will naturally cease to exist on 7 December 2023.
The application was supported by a Form F24C statutory declaration by Ms Kyrin Vea Vea, General Manager for the Employer, which declared, amongst other things, that the Employer, including its associated entities, have a number of collective agreements in various states of Australia, and on account of the Fair Work Commission (the Commission) recently terminating the Dollars and Sense QLD (Retails Association) Employee Collective Agreement 2009,[1]it is easier for the Employer and its associated entities to have all employees covered by the General Retail Industry Award 2020 (the Award). The Employer noted that all of its employees’ pays and those of its associated entities are governed by a single payroll system. Ms Vea Vea advised that there are employees covered by the Agreement.
It is apparent that if the Agreement is terminated, the Award in [3] will apply.
The Agreement does not cover any employee organisations (unions).
I directed the Employer to communicate in writing to each of the employees covered by the Agreement, inviting them to correspond by email with my chambers in the event they wished to provide their views. I received confirmation from the Employer that it had complied with the above direction. I did not receive any correspondence from any of the relevant employees.
Legislative Provisions
The relevant provision of the Transitional Act is as follows:
“Schedule 3…
16 Collective agreement‑based transitional instruments: termination by the FWC
(1) Subdivision D of Division 7 of Part 2‑4 of the FW Act (which deals with termination of enterprise agreements after their nominal expiry date) applies in relation to a collective agreement‑based transitional instrument as if a reference to an enterprise agreement included a reference to a collective agreement‑based transitional instrument.
(2) For the purpose of the application of Subdivision D to an old IR agreement, the agreement’s nominal expiry date is taken to be the end of the period of the agreement.
(3) To avoid doubt, subsection 615A(3) of the FW Act does not apply in relation to a collective agreement‑based transitional instrument.”
The relevant provisions of the Fair Work Act 2009 (the Act), as of 7 December 2022, 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;
(c) an employee organisation covered by the agreement.”
226 When the FWC must terminate an enterprise agreement
(1) 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 the continued operation of the agreement would be unfair for the employees covered by the agreement; or
(b) the FWC is satisfied that the agreement does not, and is not likely to, cover any employees; or
(c) all of the following apply:
(i) the FWC is satisfied that the continued operation of the enterprise agreement would pose a significant threat to the viability of a business carried on by the employer, or employers, covered by the agreement;
(ii) the FWC is satisfied that the termination of the enterprise agreement would be likely to reduce the potential of terminations of employment covered by subsection (2) for the employees covered by the agreement;
(iii) if the agreement contains terms providing entitlements relating to the termination of employees’ employment—each employer covered by the agreement has given the FWC a guarantee of termination entitlements in relation to the termination of the agreement.
(1A) However, the FWC must terminate the enterprise agreement under subsection (1) only if the FWC is satisfied that it is appropriate in all the circumstances to do so.
(2) This subsection covers a termination of the employment of an employee:
(a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or
(b) because of the insolvency or bankruptcy of the employer.
(3) In deciding whether to terminate the agreement, the FWC must consider the views of the following covered by the agreement:
(a) the employees (unless there are no employees covered by the agreement);
(b) each employer;
(c) each employee organisation (if any).
Note: The President may be required to direct a Full Bench to perform a function or exercise a power in relation to the matter if any of the employers, employees, or employee organisations, covered by the agreement oppose the termination (see subsection 615A(3)).
(4) In deciding whether to terminate the agreement (the existing agreement), the FWC must have regard to:
(a) whether the application was made at or after the notification time for a proposed enterprise agreement that will cover the same, or substantially the same, group of employees as the existing agreement; and
(b) whether bargaining for the proposed enterprise agreement is occurring; and
(c) whether the termination of the existing agreement would adversely affect the bargaining positionof the employees that will be covered by the proposed enterprise agreement.
(5) In deciding whether to terminate the agreement, the FWC may also have regard to any other relevant matter.
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.”
Consideration
As the Agreement has passed its nominal expiry date, and the Employer is an employer covered by the Agreement, I find that the Employer has standing to make the application pursuant to s.225(a) of the Act.
In consideration of s.226(1)(a) of the Act, and whether it would be unfair for the employees covered by the Agreement to continue to be covered by the Agreement, I note the deficiency of terms within the Agreement when compared with the Award. Even taking into account some greater entitlements of the Agreement, such as severance pay and some weekend and public holidays penalties, I consider employees will likely be entitled to greater conditions if covered by the Award than they would be if continued to be covered by the Agreement. I am satisfied that the continued operation of the Agreement would be unfair to the employees covered by it.
Having regard to s.226(3)(b), the views of the Employer are naturally, by virtue of the application, that it wishes for the Agreement to be terminated as it no longer wishes to be bound by it. None of the employees covered by the Agreement provided their views for the Commission’s consideration.
The considerations at ss.226(2) and (4) are not relevant and I am satisfied that there are no other relevant matters to take into account in deciding whether to terminate the Agreement.
Having regard to s.226(1A) of the Act, I am satisfied that it is appropriate in all the circumstances to do so. Accordingly, I must terminate the Agreement. The application to terminate the Agreement is approved.
As per s.227 of the Act, if an enterprise agreement is terminated under s.226, the termination operates from the day specified in the decision to terminate the Agreement.
The Employer had previously advised my chambers in the matter referred to at [3] that the pay cycle for these employees is from Monday to Sunday. Accordingly, I consider it appropriate for the termination to take effect from Monday, 27 March 2023 such that the relevant award will apply from that day.
The termination will take effect from 27 March 2023.
COMMISSIONER
[1] [2023] FWCA 523
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