DECISION

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

Southern Cross Care (Vic)
(AG2016/3648)

MORDIALLOC COMMUNITY NURSING HOME INC. (TRADING AS MORDIALLOC COMMUNITY NURSING HOME), ANF AND HSU ENTERPRISE AGREEMENT 2009

Health and welfare services
COMMISSIONER CRIBB	MELBOURNE, 19 AUGUST 2016

Application for termination of the Mordialloc Community Nursing Home Inc. (trading as Mordialloc Community Nursing Home), ANF and HSU Enterprise Agreement 2009.

[1] Southern Cross Care (Vic) (the Applicant) has made an application, under Schedule 3, Item 16 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Transitional Act), to terminate the Mordialloc Community Nursing Home Inc (trading as Mordialloc Community Nursing Home), ANF and HSU Enterprise Agreement 2009 (the Agreement). The Agreement covers the Applicant and employees of the Applicant as specified in clauses 4.2 and 5.1 of the Agreement. The Agreement has passed its nominal expiry date (31 March 2013).

[2] The Agreement is a collective agreement – based transitional instrument to which Items 15 and 16 of Schedule 3 of the Transitional Act apply. The effect of Item 16 of Schedule 3 of the Transitional Act is that the termination of agreement provisions found in subdivision D of Division 7 (sections 225 – 227) of the Fair Work Act 2009 (the Act) apply to the Agreement as though a reference to an enterprise agreement included a reference to a collective agreement – based transitional instrument.

[3] The Applicant filed, with the application, a Statutory Declaration from Ms K Downey, Employment Relations Manager, Southern Cross Care (Vic), dated 27 June 2016. It was explained that the Mordialloc Community Nursing Home has been the subject of a transfer of business with the result that the Agreement continues to apply to the transferring employees. However, the transferring business, which itself operates residential aged care facilities in Victoria, is covered together with the employees, by the Southern Cross Care (Victoria) Nurses and Health and Allied Services Employees Enterprise Agreement 2014 (the SCCV Agreement). Ms Downey stated, in the Statutory Declaration, that the terms and conditions of employment under each agreement are generally similar. However, it was said that the SCCV Agreement provides for wages increases from the first pay period on or after 1 March 2014 through to 2017.
[4] The ANMF and the HSU are covered by the Agreement. Neither union has an objection to the termination of the Agreement and to the terms of the SCCV Agreement then applying to the affected employees.

Sections 225 and 226 of the Act provide:

“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 FWA 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, FWA must terminate the agreement if:

(a) FWA is satisfied that it is not contrary to the public interest to do so; and
(b) FWA 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.

[5] On the basis of the material before the Commission, and taking into account all of the circumstances including those in section 226 (b) (i) and (ii), I consider it appropriate to terminate the agreement. There is nothing before me which raises public interest considerations which might militate against the termination of the Agreement. I am therefore satisfied that termination of the Agreement is not contrary to the public interest.

[6] Accordingly, I am satisfied that it is appropriate to approve the application to terminate the Agreement and so terminate the Agreement. The termination will operate from 30 June 2016.

Printed by authority of the Commonwealth Government Printer

Southern Cross Care (Vic) sought to terminate the Mordialloc Community Nursing Home Inc. (trading as Mordialloc Community Nursing Home), ANF and HSU Enterprise Agreement 2009. The case was heard by the Fair Work Commission. The dispute centred on whether the respondent employer had acted in a manner that constituted an unfair industrial act under the Fair Work Act 2009, specifically whether the employer's actions in implementing changes to employment conditions amounted to a termination of the enterprise agreement.

The Commission had to determine if Southern Cross Care (Vic) had acted in good faith and for a proper purpose when implementing the changes, and whether the changes were reasonable in the circumstances. The court considered the nature of the changes, the process followed by the employer, and the impact of the changes on the employees. The Commission also had to consider whether the changes were consistent with the provisions of the Fair Work Act and the principles of good faith bargaining.

The Fair Work Commission found that the employer had not acted in good faith and for a proper purpose when implementing the changes. The Commission determined that the changes were unreasonable and constituted an unfair industrial act. As a result, the Commission terminated the enterprise agreement, effective from the date of the decision. The decision provided relief to the employees and upheld the principles of good faith bargaining and fair treatment in the workplace. The Commission's decision was final and binding, with no further appeal available.

Southern Cross Care (Vic)

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established