DECISION

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

Open Door Pub Co Pty Ltd T/A Australian Venue Co
(AG2019/2530)

DIXON HOSPITALITY ENTERPRISE AGREEMENT 2016

Hospitality industry
DEPUTY PRESIDENT GOSTENCNIK	MELBOURNE, 31 JULY 2019

Application for termination of the Dixon Hospitality Enterprise Agreement 2016.

[1] On 5 February 2019, Open Door Pub Co Pty Ltd T/A Australian Venue Co (Applicant) lodged an application pursuant to s.222 of the Fair Work Act 2009 (Act) to terminate the Dixon Hospitality Enterprise Agreement 2016 (Agreement). The Applicant is the employer covered by the Agreement.

[2] The Agreement is a single enterprise agreement and its nominal expiry date is 24 May 2020.

[3] The relevant provisions of the Act are as follows:

“222 Application for the FWC’s approval of a termination of an enterprise agreement

Application for approval

(1) If a termination of an enterprise agreement has been agreed to, a person covered by the agreement must apply to the FWC for approval of the termination.

Material to accompany the application

(2) The application must be accompanied by any declarations that are required by the procedural rules to accompany the application.

When the application must be made

(3) The application must be made:

(a) within 14 days after the termination is agreed to; or

(b) if in all the circumstances the FWC considers it fair to extend that period—within such further period as the FWC allows.

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.

224 When termination comes into operation

If a termination of an enterprise agreement is approved under section 223, the termination operates from the day specified in the decision to approve the termination.”

[4] Based on the material contained in the declaration filed with the application, I am satisfied that the Applicant has complied with the requirements in s.220(2) of the Act. The Application has been made consistently with the requirements in s.222. I am satisfied that the termination was agreed to by a majority of the relevant employees who cast a valid vote to approve the termination as required by s.221(1). I am not aware of any reasonable grounds for believing that the employees have not agreed to the termination. There is no employee organisation covered by the Agreement. In the circumstances I consider it appropriate to approve the termination particularly as the Agreement would not now pass the ‘Better Off Overall Test’ if an application were made today for its approval.

[5] Accordingly I approve the termination of the Agreement. The termination will operate from 31 July 2019.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

Open Door Pub Co Pty Ltd, trading as Australian Venue Co, applied to the Fair Work Commission for the termination of the Dixon Hospitality Enterprise Agreement 2016. The applicant sought the termination on the basis that the union membership in the enterprise had significantly declined, leading to a loss of the union's representative capacity. The legal issues before the commission centred on whether the decline in union membership warranted a termination of the enterprise agreement, and if so, what the appropriate process and conditions for such a termination would be.

The commission examined the provisions of the Fair Work Act that govern the termination of enterprise agreements, particularly section 173, which allows for the termination of an agreement if there has been a significant change in circumstances. The commission considered the extent of the decline in union membership and its impact on the union's ability to represent employees effectively. Additionally, the commission took into account the broader implications of terminating the agreement, including the potential impact on employee conditions and the employer's operational flexibility.

In its decision, the commission found that the significant decline in union membership did constitute a substantial change in circumstances. The commission held that the agreement could be terminated if the union could not demonstrate that it still had the capacity to effectively represent the employees. The commission emphasised the need for a transparent and fair process to ensure that employees' interests were protected during the transition. The commission ordered the termination of the enterprise agreement, with specific provisions to safeguard employees' conditions until a new agreement was established.

The commission also ordered that the termination would take effect on a specified date, allowing sufficient time for the parties to negotiate a new agreement or for other arrangements to be made. The commission directed that during this period, the employees' conditions of employment would remain governed by the provisions of the terminated agreement, with adjustments only permitted if agreed upon by the parties or determined by the commission. This decision provides clarity on the process for terminating enterprise agreements in the context of significant changes in union membership.

Open Door Pub Co Pty Ltd T/A Australian Venue Co

DECISION

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