Skout Solutions Pty Ltd

[2020] FWCA 1835

[2020] FWCA 1835

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185—Enterprise agreement
s.222—Enterprise agreement

Skout Solutions Pty Ltd
(AG2020/353)

SKOUT SOLUTIONS INDUSTRIAL ENTERPRISE AGREEMENT 2019

Electrical contracting industry
DEPUTY PRESIDENT CLANCY	MELBOURNE, 7 APRIL 2020

Applications for approval of the Skout Solutions Industrial Enterprise Agreement 2019 and the termination of the Skout Solutions Industrial Enterprise Agreement 2016.

[1] An application pursuant to s.185 of the Fair Work Act 2009 (the Act) has been made for the approval of an enterprise agreement known as the Skout Solutions Industrial Enterprise Agreement 2019. It has been made by Skout Solutions Pty Ltd (Skout).

[2] There is also a related application before me. Pursuant to s.222 of the Act, Skout has also applied to the Commission for approval of the termination of the Skout Solutions Industrial Enterprise Agreement 2016. This Agreement was approved by the Commission on 14 March 2017, commenced operation from 21 March 2017 and has a nominal expiry date of 14 March 2021.

[3] Skout says it has engaged in a process whereby it asked its workforce to undertake a simultaneous vote to terminate the Skout Solutions Industrial Enterprise Agreement 2016 and, at the same time, approve the Skout Solutions Industrial Enterprise Agreement 2019.

[4] It is therefore convenient to deal with the two applications together.

Application for approval to terminate the Skout Solutions Industrial Enterprise Agreement 2016

[5] It was open to Skout, as the employer covered by the Skout Solutions Industrial Enterprise Agreement 2016 (the 2016 Agreement), to request the employees covered by that agreement to approve the proposed termination by voting for it. 1

[6] Before making the request, Skout was required to:

•  take all reasonable steps to notify the employees of the time and place at which the vote would occur and the voting method that would be used; 2 and

•  give the employees a reasonable opportunity to decide whether they wanted to approve the proposed termination of the 2016 Agreement. 3

[7] Mr Matthew Berry, General Manager of Skout, made a statutory declaration on 20 March 2020 in support of the application for the approval of the termination of the 2016 Agreement (the termination statutory declaration). Having regard to the contents of the termination statutory declaration and those of the statutory declaration in support of the application for the approval of the Agreement (the approval statutory declaration), also made by Mr Berry on 20 March 2020, I am satisfied these obligations were fulfilled. In particular, I that note Mr Berry has declared in these two statutory declarations:

•  At an information session for employees held on 18 December 2019, he said words to the following effect:

•  that while the 2016 Agreement did not expire until March 2021, Skout proposed to terminate the 2016 Agreement and replace it with a new agreement so that conditions in the new agreement could commence and Skout could both retain long term clients and offer better job security;

•  a vote was going to take place in which the employees could vote in favour of terminating the 2016 Agreement and simultaneously vote to replace it with the new agreement;

•  if the vote was not successful, the 2016 Agreement would remain on foot; and

•  if the vote was successful, the 2016 Agreement would be terminated and would be replaced by the new agreement, subject to its approval by the Commission.

•  Employees were issued with information regarding the times and methods of electronic voting that would be used via an email sent to them on 20 January 2020.

•  A range of documents were provided to employees on each of 20, 22 and 23 January 2020 with information about the proposal and the vote.

•  Information sessions were held with employees on 22 and 23 January 2020, which covered matters such as the differences between the 2016 Agreement and the proposed new agreement.

•  Between 22 and 29 January 2020, he made individual phone calls to all employees during which he reiterated that the vote was a one-step process that would deal with both the 2016 Agreement and the proposed new agreement.

[8] Further, I am satisfied that the termination of the 2016 Agreement was agreed to because a majority of employees who cast a valid vote approved the termination. 4 In this regard, Mr Berry declared that Skout’s proposal was put to a vote on 30 January 2020, at which time 56 out of the 74 Skout employees voted and 52 of these employees voted in favour of approving the the Skout Solutions Industrial Enterprise Agreement 2019 and terminating the 2016 Agreement.

[9] This having occurred, Skout was obligated to apply to the Commission for approval of the termination. 5 It has done so by making application with the accompanying statutory declaration required by the Fair Work Commission Rules 2013.6However, with the application to terminate the 2016 Agreement not having been made within 14 days after 30 January 2020, I must consider whether in all the circumstances, it is fair to extend that 14 day period to 23 March 2020.7

[10] I have had regard to the fact that there was a joint process employed that involved both voting whether to terminate an existing agreement and approving a proposed new agreement and the result was that a majority of employees endorsed these outcomes. I have also noted that the application for the approval of the Skout Solutions Industrial Enterprise Agreement 2019 was made within the requisite time period and am prepared to accept the explanation from Skout that the accompanying requirement to make application to terminate the 2016 Agreement was overlooked. In all the circumstances, I am satisfied it is fair to extend the time for the making of the application to terminate the 2016 Agreement to 23 March 2020.

[11] It is useful to set out s.223 of the Act, which requires the Commission to terminate the 2016 Agreement if it is satisfied of the matters set out therein:

“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.”

[12] As I have outlined in [7] above, I am satisfied that Skout complied with s.220(2) in relation to the 2016 Agreement (s.223(a)). Further, as outlined in [8], I am satisfied that the termination of the 2016 Agreement was agreed to in accordance with s.221(1) of the Act (s.223(b)) and additionally, I am satisfied based on the material before me that there are no other reasonable grounds for believing that the Skout employees have not agreed to the termination (s.223(c)). Turning to s.223(d), I consider it appropriate to approve the termination and note there are no employee organisations covered by the 2016 Agreement.

[13] Accordingly, with the conditions in s.223 having been satisfied, I must approve the termination of the 2016 Agreement.

Application for approval of the Skout Solutions Industrial Enterprise Agreement 2019

[14] As outlined in at [1] above, an application has been made for the approval of an enterprise agreement known as the Skout Solutions Industrial Enterprise Agreement 2019 (the Agreement) pursuant to s.185 of the Act. The Agreement is a single enterprise agreement.

[15] The Agreement does not cover all of the employees of Skout, however, taking into account the factors in s.186(3) and s.186(3A) I am satisfied that the group of employees was fairly chosen.

[16] Skout has provided written undertakings. A copy of the undertakings is attached in Annexure A. I am satisfied that the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in a substantial change to the Agreement. The undertakings are taken to be a term of the Agreement.

[17] Subject to the undertakings referred to above, and on the basis of the material contained in the application and accompanying statutory declaration, I am satisfied that each of the requirements of ss 186, 187, 188 and 190 as are relevant to this application for approval have been met.

Conclusions

[18] The termination of the Skout Solutions Industrial Enterprise Agreement 2016 is approved. Pursuant to s.224 of the Act, the termination takes effect from 14 April 2020.

[19] The Skout Solutions Industrial Enterprise Agreement 2019 is approved and, in accordance with s.54, will operate from 14 April 2020. The nominal expiry date of the Skout Solutions Industrial Enterprise Agreement 2019 is 8 April 2024.

DEPUTY PRESIDENT

Annexure A

 1   Fair Work Act 2009 s.220(1).

 2   Ibid s.220(2)(a).

 3   Ibid s.220(2)(b).

 4   Ibid s.221(1).

 5   Ibid s.222(1).

 6   Ibid s.222(2) and Rule 26(1) of the Fair Work Commission Rules 2013.

 7   Fair Work Act 2009 s.223(3)(b).

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