Sorbent Paper Company Sorbent Paper Company Pty Ltd T/A Sorbent Paper Company

[2024] FWCA 2405

[2024] FWCA 2405

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

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

Sorbent Paper Company Sorbent Paper Company Pty Ltd T/A Sorbent Paper Company

(AG2024/2229)

SORBENT PAPER CO PTY LTD LARAPINTA ENTERPRISE AGREEMENT 2021

Storage services
COMMISSIONER RIORDAN	SYDNEY, 1 JULY 2024

Application for termination of the Sorbent Paper Co Pty Ltd Larapinta Enterprise Agreement 2021

1. Sorbent Paper Company Sorbent Paper Company Pty Ltd T/A Sorbent Paper Company (the Applicant) has filed an application pursuant to s.225 of the Fair Work Act 2009 (the Act) to terminate the Sorbent Paper Co Pty Ltd Larapinta Enterprise Agreement 2021 (the Agreement) after its nominal expiry date.

1. The Agreement is a single enterprise agreement and its nominal expiry date was 7 May 2023.

1. Section 225 and 226 of the Act relevantly provides:

“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     Terminating an enterprise agreement after its nominal expiry date

(1) 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 the continued operation of the agreement would be unfair for the employees covered by the agreement; or

(b)       the FWC is satisfied that the agreement does not, and is not likely to, cover any employees; or

(c)       all of the following apply:

(i)           the FWC is satisfied that the continued operation of the enterprise agreement would pose a significant threat to the viability of a business carried on by the employer, or employers, covered by the agreement;

(ii)          the FWC is satisfied that the termination of the enterprise agreement would be likely to reduce the potential of terminations of employment covered by subsection (2) for the employees covered by the agreement;

(iii)         if the agreement contains terms providing entitlements relating to the termination of employees’ employment—each employer covered by the agreement has given the FWC a guarantee of termination entitlements in relation to the termination of the agreement.

(1A)     However, the FWC must terminate the enterprise agreement under subsection (1) only if the FWC is satisfied that it is appropriate in all the circumstances to do so.

(2)       This subsection covers a termination of the employment of an employee:

(a)       at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

(b)       because of the insolvency or bankruptcy of the employer.

(3)       In deciding whether to terminate the agreement, the FWC must consider the views of the following covered by the agreement:

(a)       the employees (unless there are no employees covered by the agreement);

(b)       each employer;

(c)       each employee organisation (if any).

Note: The President may be required to direct a Full Bench to perform a function or exercise a power in relation to the matter if any of the employers, employees, or employee organisations, covered by the agreement oppose the termination (see subsection 615A(3)).

(4)       In deciding whether to terminate the agreement (the existing agreement), the FWC must have regard to:

(a)       whether the application was made at or after the notification time for a proposed enterprise agreement that will cover the same, or substantially the same, group of employees as the existing agreement; and

(b)       whether bargaining for the proposed enterprise agreement is occurring; and

(c)       whether the termination of the existing agreement would adversely affect the bargaining position of the employees that will be covered by the proposed enterprise agreement.

(5)       In deciding whether to terminate the agreement, the FWC may also have regard to any other relevant matter.”

1. Ms Erika Zamora, Head of Human Resources, filed a Form F24C Statutory Declaration in support of the application to terminate the Agreement.

1. In her Statutory Declaration, Ms Zamora provided that the Applicant’s operations will cease as of 28 June 2024. Ms Zamora provided that after this date, there will not be any employees covered by the Agreement, and therefore, the Agreement will be “null and void”.

1. Ms Zamora provided that all 7 employees covered by the Agreement had been consulted and voted in support of terminating the Agreement. Ms Zamora annexed Meeting Minutes from meetings held on 5 and 6 March 2024, communications provided to the employees covered by the Agreement, and the signed ballot papers of all employees voting in support of terminating the Agreement.

1. Ms Zamora provided that all employees have accepted a voluntary separation.

1. My Chambers wrote to Ms Zamora on 24 June 2024, advising that I intended to list the matter for a brief Telephone Conference and asking that she confirm the availability of herself and a representative for the employee group.

1. A Telephone Conference was conducted on 27 June 2024, with Ms Zamora, two employees and a manager present.

1. At this Telephone Conference, Ms Zamora confirmed the information contained in her Statutory Declaration, including that the Applicant’s operations would cease as of 28 June 2024 and that no employees would be transferring to the organisation taking over the warehouse and distribution of the company product. The employees confirmed that all employees had voluntarily accepted separations from the Applicant.

1. On the basis of the information provided to me in the Application, and as confirmed at the Telephone Conference, I am satisfied that the requirements of s.226 of the Act as are relevant to this Application for termination have been met and that the Agreement should accordingly be terminated.

1. The termination will operate from 1 July 2024. 

1. I so Order.

COMMISSIONER

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