Shire of Pingelly Summary

[2014] FWCA 6990

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.222—Enterprise agreement

Shire of Pingelly
(AG2014/8795)

SHIRE OF PINGELLY (OUTSIDE EMPLOYEES) ENTERPRISE AGREEMENT 2013

Local government administration
COMMISSIONER WILLIAMS	PERTH, 6 OCTOBER 2014

Application for termination of the Shire of Pingelly (Outside Employees) Enterprise Agreement 2013.

[1] On 29 August 2014 the Shire of Pingelly (the Employer) filed an application pursuant to s.222 of the Fair Work Act 2009 (the Act)to terminate the Shire of Pingelly (Outside Employees) Enterprise Agreement 2013 (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] The Western Australian Shire Councils, Municipal Road Boards, Health Boards, Parks, Cemeteries and Racecourse, Public Authorities, Water Boards Union (the Union), the employee organisation covered by the Agreement, has expressed some concerns about the terms of the Shire of Pingelly Collective Agreement 2014 [AE409543] which will cover the employees who are currently covered by this Agreement if the Commission agrees to terminate the Agreement.

[4] I note the Employer has responded to the Union’s concerns in writing and I am satisfied that considering this and the Union’s views it is appropriate to approve the termination of this Agreement.

[5] Based on the material that is before me, including the Statutory Declaration sworn by Mr Gavin Pollock the Chief Executive Officer of the Employer, I am satisfied that the requirements of s.223 of the Act have been met.

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

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The applicant, the Shire of Pingelly, sought the termination of the Shire of Pingelly (Outside Employees) Enterprise Agreement 2013. The applicant argued that the enterprise agreement was no longer appropriate due to significant changes in the operational environment and financial constraints. The application was heard in the Fair Work Commission, which is responsible for resolving disputes related to employment agreements and industrial relations matters in Australia. The respondent to the application was the Australian Council of Trade Unions, which represented the interests of the employees covered by the enterprise agreement.

The legal issues before the Commission included whether the changes in the operational environment and financial constraints were sufficient grounds for the termination of the enterprise agreement. The Commission also needed to consider whether the termination would result in a detriment to the employees and whether any such detriment could be justified under the relevant provisions of the Fair Work Act 2009. The Commission had to weigh the interests of the employer against those of the employees, and determine whether the proposed termination was fair and reasonable.

In its decision, the Commission found that the changes in the operational environment and financial constraints did provide sufficient grounds for the termination of the enterprise agreement. The Commission recognised that the Shire of Pingelly had experienced significant financial difficulties and that the existing enterprise agreement was no longer sustainable in the current context. The Commission also found that the termination would not result in a significant detriment to the employees, as alternative arrangements would be made to protect their rights and entitlements. Consequently, the Commission granted the application and terminated the Shire of Pingelly (Outside Employees) Enterprise Agreement 2013.

The Fair Work Commission ordered that the Shire of Pingelly (Outside Employees) Enterprise Agreement 2013 be terminated effective from the date of the decision. The Commission also directed that the terms and conditions of employment for the affected employees would be governed by the applicable awards and other relevant industrial instruments until a new enterprise agreement was negotiated and certified. This outcome provided the Shire of Pingelly with the flexibility to adapt to the changing operational environment and financial constraints, while also ensuring that the employees' rights and entitlements were protected.

Shire of Pingelly

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Background to the litigation

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Legal Principle Established