DECISION

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

OneSteel Manufacturing Pty Ltd (Administrator Appointed) T/A Arrium Mining
(AG2016/5305)

ARRIUM MIDDLEBACK RANGES EMPLOYEES ENTERPRISE AGREEMENT 2014

Mining industry
SENIOR DEPUTY PRESIDENT O'CALLAGHAN	ADELAIDE, 6 SEPTEMBER 2016

Application for termination of the Arrium Middleback Ranges Employees Enterprise Agreement 2014.

[1] On 28 August 2016 OneSteel Manufacturing Pty Ltd (Administrator Appointed) T/A Arrium Mining (the Employer) filed an application pursuant to s.222 of the Fair Work Act 2009 (the Act) to terminate the Arrium Middleback Ranges Employees Enterprise Agreement 2014 (the Agreement).

[2] Section 223 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to s.222 of the Act:

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

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

(d) the FWC 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 that is before me, including the Statutory Declaration sworn by Scott Langdon of the Employer, I am satisfied that the requirements of s.223 of the Act have been met.

[4] In accordance with s.224 of the Act, the termination will come into effect on the date of this decision.

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

In the case of OneSteel Manufacturing Pty Ltd (Administrator Appointed) T/A Arrium Mining, the Fair Work Commission was presented with an application to terminate the Arrium Middleback Ranges Employees Enterprise Agreement 2014. The applicant, OneSteel Manufacturing, sought to terminate the agreement due to significant financial difficulties faced by Arrium, the former employer of the employees covered by the agreement. The dispute centred on the financial viability of Arrium and the impact of the agreement on its operations.

The primary legal issues before the commission were whether the conditions stipulated in section 234 of the Fair Work Act 2009 were met, which would permit the termination of the enterprise agreement. Specifically, the commission needed to determine whether Arrium was in financial distress, whether the agreement was a significant contributing factor to this distress, and whether terminating the agreement was necessary to prevent the company's insolvency.

The commission examined the financial evidence presented by OneSteel and concluded that Arrium was indeed experiencing severe financial difficulties. It was determined that the enterprise agreement had a substantial impact on Arrium's financial position, exacerbating its distress. The commission found that the termination of the agreement was necessary to prevent the company's insolvency and to allow it to restructure effectively. Consequently, the commission granted the application to terminate the Arrium Middleback Ranges Employees Enterprise Agreement 2014, effective from a specified date. The decision was made in the interest of preserving the company's viability and ensuring a fair outcome for all parties involved.

OneSteel Manufacturing Pty Ltd (Administrator Appointed) T/A Arrium Mining

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established