Rebecca Cushway

[2022] FWCA 2171

[2022] FWCA 2171

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.225—Enterprise agreement

Rebecca Cushway

(AG2022/1538)

Inn Hospitality Pty Ltd Enterprise Agreement 2015

Hospitality industry
DEPUTY PRESIDENT CROSS	SYDNEY, 26 JULY 2022

Application for termination of the Inn Hospitality Pty Ltd Enterprise Agreement 2015

1. An application has been made pursuant to s.225 of the Fair Work Act 2009 (Cth) (the Act) by Ms Rebecca Cushway (the Applicant) for approval to terminate the Inn Hospitality Pty Ltd Enterprise Agreement 2015 (the Agreement). The nominal expiry date of the Agreement is 6 July 2019.

1. 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.”

Background

1. The Applicant is an employee covered by the Agreement and thus has standing to make the termination application. The Agreement has passed its nominal expiry date of 6 July 2019.

1. The Applicant identified a number of employees covered by the Agreement. The Application was served on the Imperial Hotel Erskineville, identified by the Applicant as her employer.

1. Correspondence was received by my Chambers on 27 May 2022, noting that IM Operations Pty Ltd (IM Operations) is the employer of labour at the Imperial Hotel Erskineville. In that correspondence, it was noted that IM Operations is party of a group of associated entities employing staff across a number of hospitality venues. IM Operations noted that as a result of transfers of business, there are non-associated entities which are also covered by the Agreement.

1. On 4 June 2022, correspondence was sent to my Chambers by HRO Initiatives Pty Ltd (HRO), noting that HRO currently employs employees under the Agreement on behalf of a number of clients, through a labour hire arrangement. It was raised by HRO that the Agreement may also cover a number of former clients of HRO as a result of transfers of business at the end of labour hire arrangements.

1. Directions were issued allowing for submissions to be filed by anyone covered by the Agreement. The Directions were distributed by IM Operations and HRO to employees, clients, and employees of clients. Pursuant to those Directions, the following materials were filed:

·     On 3 June 2022, IM Operations filed an outline of submissions, and a witness statement of Mr James Wicks, Commercial Director of ‘The Sydney Collective’;

·     On 27 June 2022, HRO filed an outline of submissions, and a witness statement of Mr Shane Duffy, CEO of HRO; and

·     Between 30 May 2022 and 27 June 2022, 11 employees covered by the Agreement filed submissions. In two instances, the submissions received from the employee were signed by a number of employees.

1. The Agreement does not cover any employee organisations.

Consideration

1. In the Form F24c filed with the application, the Applicant submitted:

·     It is in the public interest to terminate this Enterprise Agreement because it would provide the employee with pay that meets the standard Hospitality Industry General Award. As it stands, employees are supplementing their income with additional employment due to the lack of adequate compensation provided by this Enterprise Agreement.

·     The rate of pay outlined in the Enterprise Agreement is no longer competitive to the current Hospitality Industry General Award.

1. IM Operations supported the termination of the Agreement, submitted that a termination date of 2 January 2023 was appropriate, and submitted:

With reference to the above, it is the Respondent’s Position that:

a.   Termination of the Agreement is not opposed;

b.   To allow an appropriate period for the Respondent to make the relevant administrative changes to comply with the Award, the operative date of the termination should be at least four months from the date of decision.

c.   Furthermore, a period of seven months would be appropriate to eliminate the risk of ongoing traineeships not being completed as a result of the Agreement’s termination.

1. HRO did not object to the termination of the Agreement, but submitted that the appropriate time for the termination of the Agreement should be no earlier than 15 October 2022. That was because that date would allow employees to either be directly employed by clients under the Award from their first pay period commencing on or after 1 October 2022, at the latest, or continue working for HRO under the Award.

1. HRO noted that a significant number of HRO's clients use HRO to provide labour hire services because of the flexible terms of the Agreement. HRO consider it very likely that a significant number of HRO's clients will terminate their service agreement with HRO due to the termination of the Agreement, as they will no longer wish HRO to provide labour hire services to them under the terms of the Award, rather than the Agreement.

The Termination Date

1. The preferred termination date identified by IM Operations and HRO was 2 January 2023 and 15 October 2022 respectively.

Determination

1. Based on the material accompanying the application and the information provided to the Commission, I am satisfied that the requirements of s.226 have been met, and that it is appropriate to terminate the Agreement. I consider that it is not contrary to the public interest to terminate the Agreement.

2. Pursuant to s.226 of the Act, the Agreement will be terminated. The termination will come into effect from 2 January 2023, as I accept that termination date would be appropriate to eliminate the risk of ongoing traineeships not being completed as a result of the Agreement’s termination, and allow the transfer of employees to either be directly employed by clients under the Award, or continue working for HRO under the Award.

1. An Order to that effect has been issued with this Decision.

DEPUTY PRESIDENT

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