Rode's Excavations Pty Ltd

[2016] FWCA 7804

[2016] FWCA 7804

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.225 - Application for termination of an enterprise agreement after its nominal expiry date

Rode's Excavations Pty Ltd
(AG2016/5607)

RODE'S EXCAVATIONS PTY LTD ENTERPRISE AGREEMENT 2013

Building, metal and civil construction industries
COMMISSIONER HUNT	BRISBANE, 31 OCTOBER 2016

Application for termination of the Rode's Excavations Pty Ltd Enterprise Agreement 2013.

[1] On 9 September 2016, Rode's Excavations Pty Ltd (the Company) applied, pursuant to s.225 of the Fair Work Act 2009 (the Act) to terminate the Rode's Excavations Pty Ltd Enterprise Agreement 2013 (the Agreement). The Agreement has passed its nominal expiry date.

[2] The application was accompanied by a statutory declaration in support of the termination, declared by Caroline Rode, Director of the Company.

[3] On 26 October 2016, the Company wrote to the Fair Work Commission (the Commission) advising that the conditions of employment would revert back to those contained in the Road Transport and Distribution Award 2010 (the Award). The Employer advised that employees would be paid higher rates of pay than those in the Award. As an example, the Employer advised that a casual Grade 6 driver would be paid at $30 per hour. It is noted that the current award rate of pay is $25.25 per hour for the same grade.

[4] The matter was listed before me on 31 October 2016 for an e-hearing. The Company was directed to provide a copy of the Notice of Listing to all employees covered by the Agreement. There was no communication from employees to the Commission.

[5] On 23 October 2016, the Company conducted a meeting with each of its employees covered by the Agreement. The employees were informed of the proposed termination and a proposed letter of engagement setting out the conditions that would be provided if the application to terminate the agreement was approved by the Commission. The employees signed a petition provided by the Company in support of the termination.

The legislation

[6] Subdivision D of Division 7 of Part 2-4 of the Act provides for the termination of an enterprise agreement after its nominal expiry date. This subdivision consists of ss. 225, 226 and 227, the terms of which 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

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 terminate the agreement.”

Consideration

[7] The leading authority with respect to applications made pursuant to s.225 is a decision of a Full Bench of the Commission in Aurizon 1. In that decision the Full Bench said:

The legislative scheme therefore enables and facilitates good faith bargaining for an enterprise agreement. It also facilitates the making of enterprise agreements but does not mandate that result. Once an enterprise agreement is made and approved by the Commission, it seems clear that the legislative scheme does not intend that such agreements operate in perpetuity. Agreements have a finite nominal life. At the end of the nominal life of an agreement, bargaining parties may bargain for a new agreement utilising all of the tools available under the Act; or a person to whom an agreement applies may take steps to bring the agreement to an end in accordance with the provisions of the Act; or both may occur.

[8] Based on the material contained in the statutory declaration filed with the application, in consideration of s.226(a) and having regarding to the decision in Aurizon, I am satisfied that termination of the Agreement is not contrary to the public interest. There is nothing before me which raises public interest considerations which might militate against the termination of the Agreement.

[9] In consideration of the material before me relevant to s.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement. With regard to the circumstances of the employees following termination of the Agreement, the Award will have application to the workplace.

[10] In accordance with s.226, I must terminate the Agreement. The application to terminate the Agreement is approved.

[11] The termination will take effect from today, 31 October 2016.

COMMISSIONER

 1   Aurizon Operations Limited; Aurizon Network Pty Ltd; Australia Eastern Railroad Pty Ltd [2015] FWCFB 540 at [126]

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