DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument

Skilled Group Limited
(AG2015/6975)

SKILLED GROUP LIMITED SINO IRON EMPLOYEE COLLECTIVE AGREEMENT 2009

Industries not otherwise assigned
COMMISSIONER HAMPTON	ADELAIDE, 12 FEBRUARY 2016

Application for termination of the Skilled Group Limited Sino Iron Employee Collective Agreement 2009.

[1] This decision concerns an application by Skilled Group Limited pursuant to Item 16 of Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act), and as a consequence, s.225 of the Fair Work Act 2009 (the FW Act). The application seeks to terminate the Skilled Group Limited Sino Iron Employee Collective Agreement 2009. 1

[2] The Agreement is a collective agreement-based transitional instrument for the purposes of the Transitional Act 2 with a nominal expiry date of 29 July 2014.

The relevant legislation

[3] Item 16 of Schedule 3 of the Transitional Act provides:

“16 Collective agreement-based transitional instruments: termination by the FWC
(1) Subdivision D of Division 7 of Part 2-4 of the FW Act (which deals with termination of enterprise agreements after their nominal expiry date) applies in relation to a collective agreement-based transitional instrument as if a reference to an enterprise agreement included a reference to a collective agreement-based transitional instrument.
(2) For the purpose of the application of Subdivision D to an old IR agreement, the agreement’s nominal expiry date is taken to be the end of the period of the agreement.”

[4] Subdivision D of Division 7 of Part 2-4 of the FW Act states:

“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 FWA 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.”

[5] This application was accompanied by a statutory declaration of Ms Jenna Cuthbertson, Regional HR Manager – WA/SA/NT, which addressed the relevant criteria established by s.226 of the FW Act.

[6] Ms Cuthbertson has confirmed to the Commission that the Agreement does not cover any employee and there are no circumstances where any employee would be covered by the Agreement in the future. This arises, for the most part, from the acquisition of the employer by another business and changes in, or conclusion of, the project activity concerned.

[7] I am satisfied that the termination of the Agreement would not be contrary to the public interest. I am also satisfied that the termination is appropriate having regard to the likely effect of that action and the circumstances of the employees and the employer.

[8] The termination will take effect from midnight on Friday 12 February 2016.

COMMISSIONER

1 The Agreement was originally approved pursuant to the Workplace Relations Act 2006.

2 Item 2(5)(c)(i) of Schedule 3.

Printed by authority of the Commonwealth Government Printer

Skilled Group Limited, a company, sought the termination of the Skilled Group Limited Sino Iron Employee Collective Agreement 2009. The application was heard by the Fair Work Commission, which was required to determine whether the application met the statutory criteria for termination under the Fair Work Act 2009. The dispute arose from the company's contention that the agreement was no longer appropriate due to significant changes in the business environment and operational conditions. The union representing the employees opposed the termination, arguing that the agreement was still relevant and beneficial to the workforce.

The central legal issues the Commission had to address were whether Skilled Group Limited had established that the agreement was no longer appropriate and whether the termination of the agreement would not have an unjust or detrimental effect on the employees. The Commission examined the evidence provided by both parties regarding the operational changes, the relevance of the agreement to the current business context, and the potential impact on employees if the agreement were terminated. The company needed to demonstrate that the changes were substantial enough to warrant the termination, while the union had to show that the agreement continued to serve the interests of the employees.

The Commission concluded that the application for termination was justified based on the evidence presented. The company had demonstrated that the changes in its business operations were significant and that the existing agreement did not adequately address the new conditions. The Commission determined that the termination would not result in unjust or detrimental effects on the employees, as the company had provided assurances regarding the protection of employees' rights and conditions during the transition period. Accordingly, the application was granted, and the agreement was terminated as of the specified date.

The final orders included the termination of the Skilled Group Limited Sino Iron Employee Collective Agreement 2009, effective from a date set by the Commission. The orders also mandated that Skilled Group Limited provide notice to affected employees and address any transitional arrangements to ensure a smooth transition. The union was directed to cooperate in the process to facilitate the implementation of the decision.

Skilled Group Limited

DECISION

The relevant legislation

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established