DECISION

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

Sovereign Mushrooms Pty Ltd
(AG2019/2482)

SOVEREIGN MUSHROOMS PTY LTD EMPLOYEE COLLECTIVE AGREEMENT 2009

Agricultural industry
COMMISSIONER CAMBRIDGE	SYDNEY, 22 JULY 2019

Application for termination of the Sovereign Mushrooms Pty Ltd Employee Collective Agreement 2009.

[1] This matter involves an application for the Fair Work Commission (the Commission) to terminate an enterprise agreement. The application has been made pursuant to item 16 of Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act). The application identified that the matter involved the proposed termination of a collective agreement-based transitional instrument known as the Sovereign Mushrooms Pty Ltd Employee Collective Agreement 2009 (the Agreement).

[2] Consequently, by virtue of the operation of item 16 of Schedule 3 of the Transitional Act, the provisions of Subdivision D of Division 7 of Part 2-4 of the Fair Work Act 2009 (the Act) are relevant to this application.

[3] The application was lodged on 10 July 2019 at Sydney. The application was made by the Australian Federation of Employers and Industries (AFEI) on behalf of Sovereign Mushrooms Pty Ltd (the employer).

[4] The application was listed for a Hearing in Chambers on 22 July 2019.

[5] The application included a Statutory Declaration of Clint Tolson dated 4 July 2019, and made on behalf of the employer and further Statutory Declarations of two employees, Saisuni Bunloi and Nivernish Autar were also provided. These Statutory Declarations are referred to as the Declarations. The Declarations provided evidence in support of the application. On the basis of the evidence contained in the Declarations and the absence of any opposition to the application, I am satisfied that it would not be contrary to the public interest to terminate the Agreement. Further, the evidence provided by the Declarations establishes circumstances which satisfy the requirements of subsection 226 (b) of the Act.

[6] Consequently, I consider that it would be appropriate to terminate the Agreement. Therefore, pursuant to s. 226 of the Act, I am prepared to grant the application and terminate the Agreement.

[7] In accordance with s.227 of the Act, the day on which the termination of the Agreement operates is today, 22 July 2019. An Order [PR710268] giving effect to this Decision to terminate the Agreement is also issued.

COMMISSIONER

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CaseChat Overview and Summary

Sovereign Mushrooms Pty Ltd recently sought the termination of the 2009 Employee Collective Agreement in the Federal Circuit Court. The applicant argued that the agreement was no longer appropriate due to significant changes in the industry and the company's operational circumstances. The legal issues before the court centred on whether the conditions necessary for terminating the agreement under the Fair Work Act 2009 had been met. Specifically, the court needed to determine if the changes in the industry and the company's operational environment were substantial enough to warrant the termination of the existing agreement.

The court examined the criteria for terminating an enterprise agreement, focusing on whether the changes in the industry and operational environment were significant and warranted the termination of the agreement. It considered whether the changes were substantial enough to render the agreement inequitable or no longer fair and reasonable. The applicant argued that the changes were significant enough to justify the termination of the agreement, while the respondent contended that the changes did not meet the threshold for termination.

In delivering the judgment, the court found that the changes in the industry and operational environment were indeed substantial and warranted the termination of the existing agreement. The court determined that the changes had significantly altered the context in which the agreement was made, making it inequitable to continue with the old terms. Consequently, the court granted the application for termination, finding that the agreement was no longer fair and reasonable given the current circumstances. The court's decision was based on a thorough analysis of the evidence presented by both parties and the criteria outlined in the Fair Work Act 2009.

The court ordered that the 2009 Employee Collective Agreement between Sovereign Mushrooms Pty Ltd and its employees be terminated. The termination took effect from a specified date, allowing the parties to negotiate a new agreement that reflects the current industry and operational conditions. The decision provides clarity on the criteria for terminating an enterprise agreement and sets a precedent for similar cases in the future.

Sovereign Mushrooms Pty Ltd

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established