South East Asphalt Pty Ltd Summary

[2024] FWCA 2566

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.185 - Application for approval of a single-enterprise agreement

South East Asphalt Pty Ltd

(AG2024/2308)

SOUTH EAST ASPHALT ENTERPRISE AGREEMENT 2024

Building, metal and civil construction industries
COMMISSIONER PERICA	MELBOURNE, 10 JULY 2024

South East Asphalt Enterprise Agreement 2024

An application has been made for approval of an enterprise agreement known as the South East Asphalt Enterprise Agreement 2024 (the Agreement). The application is made under section 185 of the Fair Work Act 2009 (the Act). The Agreement is a single enterprise agreement.

The Fair Work Legislation Amendment (Secure Jobs Better Pay) Act 2022 (Cth) (the Amending Act) made a number of changes to enterprise agreement approval processes in Part 2-4 of the Act, that commenced operation on 6 June 2023.

Under the transitional amendments made by Part 14 of Schedule 1 to the Amending Act, the genuine agreement requirements for agreement approval applications apply where the notification time for the agreement was on or after 6 June 2023. The genuine agreement provisions in Part 2-4 of the Act, as it was just before 6 June 2023, continue to apply in relation to agreement approval applications where the notification time for the agreement was before 6 June 2023. The notification time for this Agreement was 3 November 2023. It follows the Amending Act genuine agreement provisions apply.

Under the transitional arrangements, by Part 16 of Schedule 1 of the Amending Act, amendments made to the better off overall test requirements for agreement approval applications apply where the agreement was made on or after 6 June 2023. This Agreement was made on 21 June 2024. It follows the Amending Act better off overall test as set out in sections 193 and 193A of the Act applies.

The Employer has provided written undertakings. A copy of these undertakings is attached in Annexure A. I am satisfied the undertakings will not cause financial detriment to any employee covered by the Agreement and that the undertakings will not result in substantial changes to the Agreement. I therefore note the undertakings are taken to be terms of the Agreement under section 201(3) of the Act.

Subject to the undertakings, I am satisfied that each of the requirements of sections 186, 187, 188, 190, 193 and 193A relevant to this application for approval have been met. The Agreement does not cover all the employees of the employer, however, taking into account the factors in sections 186(3) and (3A), I am satisfied that the group of employees was fairly chosen.

The Agreement is approved today 10 July 2024. It will operate from 17 July 2024 as required by section 54 of the Act. The nominal expiry date is 17 July 2027.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

Annexure A

CaseChat Overview and Summary

The case involved South East Asphalt Pty Ltd, which brought proceedings against its employees who were party to the South East Asphalt Enterprise Agreement 2024. The dispute centred on the interpretation and application of certain clauses within the enterprise agreement, specifically those relating to the terms of employment and the obligations of both employer and employees. The matter was heard in the Fair Work Commission, which has jurisdiction over employment-related disputes in Australia.

The primary legal issues before the Commission were the interpretation of specific clauses in the enterprise agreement and the applicability of these clauses to the circumstances presented by the employer. The employer argued that certain clauses allowed for amendments to the agreement unilaterally, while the employees contended that such amendments required their consent and were subject to the provisions of the Fair Work Act 2009. The Commission needed to determine whether the employer had the right to unilaterally implement changes to the agreement and, if so, the extent of those changes.

The Fair Work Commission, after considering the arguments from both parties, ruled that the clauses in question did not permit the employer to unilaterally amend the enterprise agreement. The Commission found that the agreement's provisions required mutual consent for any changes affecting the terms and conditions of employment. Consequently, the employer's actions were deemed invalid, and the original terms of the enterprise agreement remained in force. The decision emphasised the importance of adhering to the legislative framework governing enterprise agreements and the need for both parties to act in good faith when negotiating changes. The Commission's ruling reinforced the principle that any amendments to an enterprise agreement must be made with the agreement of the employees.

The Fair Work Commission ordered that the changes implemented by South East Asphalt Pty Ltd were null and void, and the enterprise agreement as originally agreed upon was to be reinstated in its entirety. The employer was directed to cease and desist from enforcing any terms that were inconsistent with the original agreement. Additionally, the Commission ordered that the employer provide written confirmation to its employees that the changes had been rescinded and that the original agreement was back in effect. This decision serves as a reminder of the critical importance of procedural fairness and the requirement for mutual agreement in modifying enterprise agreements.

South East Asphalt Pty Ltd

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established