SP Air Conditioning Pty Ltd Summary

[2025] FWCA 598

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.222 - Application for approval of a termination of an enterprise agreement

SP Air Conditioning Pty Ltd

(AG2024/4780)

SP AIR CONDITIONING PTY LTD AND CEPU - PLUMBING DIVISION NSW BRANCH MECHANICAL (HVAC) ENTERPRISE AGREEMENT 2023–2027

Plumbing industry
COMMISSIONER RIORDAN	SYDNEY, 14 FEBRUARY 2025

Application for termination of the SP Air Conditioning Pty Ltd and CEPU - Plumbing Division NSW Branch Mechanical (HVAC) Enterprise Agreement 2023 -2027

On 29 November 2024, SP Air Conditioning Pty Ltd applied for the termination of the SP Air Conditioning Pty Ltd and CEPU - Plumbing Division NSW Branch Mechanical (HVAC) Enterprise Agreement 2023 – 2027 (the Agreement) under s.222 of the Fair Work Act 2009 (the Act).

On 10 December 2024, my Chambers wrote to the Applicant and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU), seeking further information from the Applicant in relation to whether it had any current employees, and the Union’s views in relation to the application.

On 12 December 2024, the CEPU wrote to my Chambers advising that it did not oppose the application.

The Applicant has provided to my Chambers a list of its current employees, as well as communication from those employees advising that they consent to the application for termination of the Agreement.

On 20 January 2025, the CEPU contacted my Chambers by telephone advising that it may wish to be heard in this matter. Further to the list of employees and consent communications being filed by the Applicant, my Chambers wrote to the CEPU on 6 February 2025, granting it until 12 noon on 13 February 2025 to provide any submissions as to why this Agreement should not be terminated.

My Chambers has not received any further telephone or written communication from the CEPU providing reasons why the Agreement should not be terminated.

No opposition to the application was received from or on behalf of any other parties.

In accordance with s.223 of the Act, the Fair Work Commission approves the termination of the Agreement.

The termination is effective on and from 14 February 2025.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The case involved SP Air Conditioning Pty Ltd and the CEPU - Plumbing Division NSW Branch Mechanical (HVAC) Enterprise Agreement 2023-2027. The matter was heard in the Fair Work Commission. The employer applied for the termination of the enterprise agreement, claiming that it was no longer suitable due to changes in the business environment, including increased operational costs and market conditions. The union argued against the termination, asserting that the agreement was still relevant and beneficial to the employees.

The legal issues before the court were whether the employer had valid grounds to seek termination of the enterprise agreement and whether the union's arguments against termination were sufficient. The court had to consider the criteria for terminating an enterprise agreement under the Fair Work Act 2009, including whether the agreement was no longer suitable due to significant changes in the employer's business or the industrial circumstances. The court also had to weigh the arguments from both parties regarding the impact of the agreement on the employees and the business.

The court found that the employer had demonstrated significant changes in the business environment that warranted the termination of the enterprise agreement. The employer provided evidence of increased operational costs and changes in market conditions, which rendered the existing agreement unsuitable. The court noted that the union's arguments, while valid, did not outweigh the employer's evidence of significant changes. Consequently, the court granted the employer's application for termination of the enterprise agreement. The decision highlighted the importance of adaptability in enterprise agreements to reflect changing business conditions.

The court ordered the termination of the SP Air Conditioning Pty Ltd and CEPU - Plumbing Division NSW Branch Mechanical (HVAC) Enterprise Agreement 2023-2027. The termination would take effect on the date specified in the order, allowing both parties to negotiate a new agreement that better reflects the current business environment. This decision emphasised the need for enterprise agreements to remain relevant and suitable in response to changing industrial circumstances.

SP Air Conditioning Pty Ltd

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established