Pneuvay Engineering Pty Ltd

[2019] FWCA 5856

[2019] FWCA 5856

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Pneuvay Engineering Pty Ltd
(AG2019/2504)

PNEUVAY ENGINEERING PTY LTD COLLECTIVE BARGAINING WORKSHOP AGREEMENT 2016

Manufacturing and associated industries
COMMISSIONER YILMAZ	MELBOURNE, 23 AUGUST 2019

Application for termination of the Pneuvay Engineering Pty Ltd Collective Bargaining Workshop Agreement 2016.

[1] On 10 July 2019, Pneuvay Engineering Pty Ltd (Applicant) lodged an application pursuant to s.225 of the Fair Work Act 2009 (Act) to terminate the Pneuvay Engineering Pty Ltd Collective Bargaining Workshop Agreement 2016 1 (Agreement). The Applicant is the employer covered by the Agreement.

[2] The Agreement is a single enterprise agreement and its nominal expiry date was 30 June 2019.

[3] The employee organisation covered by the Agreement is the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU).

[4] The Agreement covers employees of the Applicant that are eligible to be members of the AMWU performing work in metal trades relating to the manufacture and fabrication of pneumatic conveying systems. Eligible employees covered by the Agreement include those engaged in boilermaking, fitting, service and installation.

[5] The Applicant filed a statutory declaration 2 of Mr Wei Loon Choo, the operations manager, which was declared on 10 July 2019 and a Statement3 setting out the background and context of which the application was made.

[6] On 2 August 2019, a statutory declaration was also filed by the consenting employee currently covered by the Agreement.

Background

[7] The Applicant submits that in December 2017 there was a change of ownership of the company. The company ceased its manufacturing and fabrication activities as a result of market changes and economic considerations.

[8] Over a period of 18 months, the workforce had diminished due to resignations, retirement and redundancies. The workforce covered by the Agreement currently consists of only one employee.

[9] In April 2019, the employer held discussions with those employees covered by the Agreement. At that time, there were only two employees who remained covered by the Agreement. The employer and employees agreed that rather than incur the expense of negotiation and formulation of a new agreement, that the terms of employment would be directly negotiated and agreed with the staff.

[10] The employer provided assurances to the staff that the terms of employment under the Agreement would not be diminished and a subsequent wage adjustment was made to employees as a show of good faith. The two employees covered by the Agreement at the time, agreed with the application to terminate the Agreement.

[11] On 31 July 2019, I listed the matter for mention and programming. The Applicant was directed to file additional supporting materials.

[12] At the time the application was lodged, it did not appear that the AMWU had been made aware of the company’s decision to apply for an application to terminate the Agreement. On 16 August 2019, my Chambers informed the Applicant’s AMWU contact person that an application pursuant to s.225 had been made. To date the AMWU has not made contact with my Chambers or sought to be heard in relation to the application.

[13] The one remaining employee provided a statutory declaration confirming his understanding of the application, the agreed benefits and entitlements that would remain following a termination of the Agreement and confirmation that the application to terminate the Agreement is consented to.

[14] The relevant provisions of the Act 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 termination 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.

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 termination the agreement.” 4

Consideration

[15] As the Agreement has passed its nominal expiry date and the Applicant is the employer covered by the Agreement, I find that the Applicant has standing to make the application pursuant to s.225(a) of the Act.

[16] In relation to termination of the Agreement and its impact in respect to public interest, the Applicant states in his statutory declaration that it is more cost effective and practical to directly negotiate with employees over wages and other benefits. 5 The Applicant confirms that it continued to provide the benefits of the Agreement to its remaining employees in addition to passing on annual wage review decisions to the employees covered by the Agreement. It is noted that at the time of the application there were two employees, and when final materials were filed only one employee remained covered by the Agreement. In the most recent material provided by the Applicant it was also confirmed that the remaining employee received a recent wage increase of 3.8 per cent.6 I have taken into consideration the size of the business, the impact of a termination of the Agreement and do not consider it is against the public interest to terminate the Agreement.

[17] I have also taken into consideration the declaration of the one remaining employee.

[18] Taking into account all of the circumstances required pursuant to s. 226(b)(i),(ii) of the Act, I consider that it is appropriate to terminate the Agreement.

[19] The termination will operate from 23 August 2019.

[20] An order giving effect to this decision will be issued separately in PR711604.

COMMISSIONER

 1   AE424397.

 2   Applicant’s Form F24C filed 10 July 2019.

 3   Company Statement filed 14 August 2019.

 4   Fair Work Act 2009 (Cth) ss. 225, 226, 227.

 5   Applicant’s Form F24C filed 10 July 2019 at Q2.1.

 6 Company Statement filed 14 August 2019 at [12].

Printed by authority of the Commonwealth Government Printer

<AE424397  PR711603>