Southcorp Wines Pty Ltd T/A Treasury Wine Estates

[2023] FWCA 741

[2023] FWCA 741

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.225—Enterprise agreement

Southcorp Wines Pty Ltd T/A Treasury Wine Estates

(AG2023/398)

TREASURY WINE ESTATES VINTNERS LTD - GREAT WESTERN MAINTENANCE AND LABORATORY COLLECTIVE AGREEMENT 2014

Wine industry
COMMISSIONER LEE	MELBOURNE, 24 MARCH 2023

Application for termination of the Treasury Wine Estates Vintners Ltd - Great Western Maintenance and Laboratory Collective Agreement 2014

1. On 22 February 2023, Southcorp Wines Pty Ltd T/A Treasury Wine Estates (Applicant) lodged an application pursuant to s.225 of the Fair Work Act 2009 (Act) to terminate the Treasury Wine Estates Vintners Ltd - Great Western Maintenance and Laboratory Collective Agreement 2014 (Agreement). The Agreement has passed its nominal expiry date of 30 June 2017.

1. The Agreement covers the Employer and the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU).

Legislation

1. Section 225 of the Act provides as follows:

“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.”

1. Section 226 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to s.225 of the Act as follows:

“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.”

Consideration

1. As the enterprise agreement has passed its nominal expiry date then the employer covered by the Agreement can apply to the Commission for termination of the Agreement consistent with s.225 of the Act. Clause 5 of the Agreement provides that the Agreement has a nominal expiry date of 30 June 2017. I am satisfied that the Employer has standing to bring the application under s.225(a) of the Act.

1. Question 2.1 of the Form F24C indicates no employees are covered or likely to be covered by the Agreement. Further, question 4 of the Form F24C indicates that in 2015, Treasury Wine Estates made a decision to close and sell the Site. In around May 2016, the employment of all employees working at the Site, other than the site manager, including all employees performing work covered by the Maintenance Agreement, was terminated on redundancy grounds. In around October 2018, Treasury Wine Estates decided not to sell the site. Since that time, a small number of employees had been employed to perform winery-related work (not covered by the Maintenance Agreement). No employees of Treasury Wine Estates have performed work covered by the Maintenance Agreement since May 2016 and Treasury Wine Estates does not intend to employ individuals to perform work covered by the Maintenance Agreement at the Site in the future. Therefore, with reference to s.226(1)(b) of the At, I am satisfied that the agreement does not, and is not likely to, cover any employees.  

1. With regard to s.226(1A) of the Act, I am satisfied that it is appropriate in all the circumstances to terminate the enterprise agreement. I am not aware of any circumstances that indicate that it is not appropriate to terminate the Agreement.

1. On the material before the me, s.226(2) of the Act is not relevant to this particular application.

1. Turning to s.226(3) of the Act, I have considered the view of each employer and each employee organisation.

1. The employer indicates, at question 4 of the Form F24C that it “desires that the Maintenance Agreement be terminated given that there have been no employees covered by the Maintenance Agreement for more than six years, and TWE has no intention to employ individuals at the Site to perform work covered by the Maintenance Agreement in the future.”

1. On 24 February 2023 my Chambers sent an email to the AMWU seeking their views in relation to the application to terminate the Agreement. On 28 February 2023 the AMWU sent an email to my Chambers indicating “The AMWU makes no submission in regard to the above matter.”

1. Further, the views of the employee organisation as provided in question 4 of the Form F24C indicates:

“I [Mark Kindred] am informed by Marissa Panazzolo, Workplace Relations and HR Business Partner that, on 15 November 2022, she spoke with Sue Thomas of the Australian Manufacturing and Workers' Union (AMWU) regarding TWE's proposal to terminate the Maintenance Agreement due to the fact that the Maintenance Agreement passed its nominal expiry date in 2017 and TWE does not have any employees who are covered by the Maintenance Agreement.

Ms Thomas said that the AMWU would have an opportunity to raise issues with the Fair Work Commission after the application had been filed. Ms Panazzolo said that she was calling the AMWU as a courtesy and to see whether the AMWU had any immediate concerns. None were raised by Ms Thomas during the conversation.”

1. With regard to s.226(3) of the Act, I am satisfied that there is no opposition to the termination of the Agreement from the union covered by the Agreement and that the employer supports the Agreement being terminated.

1. On the material before the me, s.226(4) of the Act has no relevant application. There is no evidence that any of the circumstances contemplated in s.226(4) are occurring.

1. I am satisfied that it is appropriate, having regard to all the circumstances, including as set out in the Form F24B and the Form F24C to terminate the enterprise agreement under s.226 of the Act. I am satisfied that the Agreement does not, and is not likely to, cover any employees, s.226(1)(b) of the Act.

1. In accordance with s.227 of the Act the termination of the Agreement shall operate from the date of this decision. An order to that effect will be separately issued.[1]

COMMISSIONER

[1] PR760573

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