DECISION

Fair Work Act 2009
s.222—Application for approval of a termination of an enterprise agreement

Southern Marine Shiplift Pty Ltd T/A Southern Marine Shiplift
(AG2019/2638)

Maritime Industry

DEPUTY PRESIDENT MASSON

MELBOURNE, 14 AUGUST 2019

Application for termination of the Southern Marine Shiplift Employee Collective Agreement 2006

[1] On 19 July 2019, Southern Marine Shiplift Pty Ltd T/A Southern Marine Shiplift (Applicant) lodged an application pursuant to s.222 of the Fair Work Act 2009 (Act) to terminate the Southern Marine Shiplift Employee Collective Agreement 2006 (Agreement). The Applicant is the employer covered by the Agreement.

[2] The Agreement which was expressed to have a nominal expiry date 3 years from the date on which it was lodged with the Employment Advocate has passed its nominal expiry date.

[3] The relevant provisions of the Act are as follows:

“222 Application for the FWC’s approval of a termination of an enterprise agreement

Application for approval

(1) If a termination of an enterprise agreement has been agreed to, a person covered by the agreement must apply to the FWC for approval of the termination.

Material to accompany the application

(2) The application must be accompanied by any declarations that are required by the procedural rules to accompany the application.

When the application must be made

(3) The application must be made:

(a) within 14 days after the termination is agreed to; or

(b) if in all the circumstances the FWC considers it fair to extend that period—within such further period as the FWC allows.

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.

224 When termination comes into operation

If a termination of an enterprise agreement is approved under section 223, the termination operates from the day specified in the decision to approve the termination.”

[4] Following receipt of the application Directions were issued by the Commission on 31 July 2019 requiring the Applicant to file and serve on all employees who are covered by the Agreement a copy of the Commission’s Directions, the application, statutory declaration and other materials on which the Applicant sought to rely. The Directions also provided for employees who wished to be heard to file submissions and materials on or by 5.00pm on 9 August 2019. No submissions or materials were filed by any employees in response to the application.

[5] Based on the information contained in the statutory declaration and accompanying material filed with the application, I am satisfied that the Applicant has complied with the requirements of s.220(2) of the Act. The Application has been made consistently with the requirements of s.222. I am further satisfied that the termination was agreed to by a majority of the relevant employees who cast a valid vote to approve the termination as required by s.221(1). I am not aware of any reasonable grounds for believing that the employees have not agreed to the termination.

[6] There are no employee organisations covered by the Agreement. In the circumstances I consider it appropriate to approve the termination having particular regard to the time that has elapsed since the Agreement reached its nominal expiry date and also the terms and conditions that will be applied by the Applicant on termination of the Agreement in accordance with the Manufacturing and Associated Industries and Occupations Award 2010.

[7] Accordingly I approve the termination of the Agreement. The termination will operate from 14 August 2019.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

In the Fair Work Commission, the applicant, Southern Marine Shiplift Pty Ltd, trading as Southern Marine Shiplift, sought the termination of the Southern Marine Shiplift Employee Collective Agreement 2006. The dispute centred on the application's assertion that the agreement was no longer applicable due to the restructuring of the business, which included a significant reduction in workforce and a shift in operations. The Commission was tasked with determining whether the application met the criteria for terminating the existing agreement under the Fair Work Act 2009.

The primary legal issues before the Commission involved assessing whether the changes in the applicant's business warranted a termination of the existing agreement and whether the application was made in good faith. The applicant argued that the significant operational changes rendered the existing agreement obsolete and that terminating it was necessary for the business's ongoing viability. The respondent, represented by the Maritime Union of Australia, contended that the application was an attempt to avoid the terms of the existing agreement and that the changes did not justify termination.

The Commission considered the evidence presented by both parties and examined the legal framework governing the termination of collective agreements. The Commission determined that the applicant had demonstrated sufficient grounds for termination under section 242 of the Fair Work Act 2009, as the significant changes in the business operations warranted a new agreement. The Commission also found that the application was made in good faith. Consequently, the Fair Work Commission granted the application and terminated the Southern Marine Shiplift Employee Collective Agreement 2006.

The Commission's decision provided relief to the applicant by allowing it to proceed with its restructuring plans without being bound by the existing agreement. The termination took effect from the date of the decision, enabling the applicant to implement the necessary changes to its business operations.

Southern Marine Shiplift Pty Ltd T/A Southern Marine Shiplift

DECISION

“222 Application for the FWC’s approval of a termination of an enterprise agreement

223 When the FWC must approve a termination of an enterprise agreement

224 When termination comes into operation

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established