SSUT Pty Ltd T/A East End Hotel

[2024] FWCFB 286 [Note: A copy of the zombie agreement to which this decision relates (AG540005) and is available on our website.]

FAIR WORK COMMISSION

DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009

Sch. 3A, Item 26A(4) - Application to extend default period for Division 2B State employment agreements

SSUT Pty Ltd T/A East End Hotel

(AG2024/1093)

EAST END HOTEL CERTIFIED AGREEMENT 2002

Hospitality industry

DEPUTY PRESIDENT WRIGHT

DEPUTY PRESIDENT SLEVIN

COMMISSIONER CRAWFORD

SYDNEY, 11 JUNE 2024

Application to extend the default period for East End Hotel Certified Agreement 2002

SSUT Pty Ltd (Applicant) has applied under item 26A(4) of Schedule 3A to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Transitional Act) to extend the default period for the East End Hotel Certified Agreement 2002 (Agreement).

The Applicant lodged an earlier application on 6 December 2023 pursuant to 26A(4) of Sch 3A to the Transitional Act to extend the default period of the Agreement. In a decision issued on 14 March 2024 the Full Bench considered that the requirements in subitem (6)(b) were met and it was appropriate in the circumstances to extend the Agreement. The Full Bench ordered that the default period for the Agreement be extended until 6 April 2024 to allow time for a replacement agreement to be made and approved.[1]

The current application lodged on 5 April 2024 seeks to extend the agreement until 20 May 2024. The application was made, in accordance with subitem (6)(b), on the ground that it is reasonable in the circumstances to extend the default period in circumstances where an enterprise agreement has been made that covers the same employees covered by the Agreement and an application has been made to have the replacement agreement approved by the Commission under the Fair Work Act 2009. An application to approve the replacement agreement was lodged with the Commission on 4 April 2024. At the time the current application was made the replacement agreement had not yet been approved by the Commission.

The Commission has since approved the replacement agreement.[2] The replacement agreement commenced operation on 29 May 2024. The purpose of the extension is to ensure the Agreement continued to apply for the period between the extended date of 6 April 2024 up until the replacement enterprise agreement commenced.

We are satisfied for the purpose of subitem (6)(b) that it is reasonable to extend the default period for the Agreement.

Pursuant to item 26A(6)(a) of Sch 3A to the Transitional Act, we order that the default period for the Agreement is extended until 29 April 2024.

The Agreement is published, in accordance with subitem 26A(10A)(c) of Sch 3A, as an annexure to this decision.

DEPUTY PRESIDENT

[1] [2024] FWCFB 130.

[2] [2024] FWCA 1497.

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The parties involved in this case are SSUT Pty Ltd, trading as the East End Hotel, and the Australian Licensed Employees' Association (ALEA). The dispute concerns an application by the East End Hotel to extend the default period for the East End Hotel Certified Agreement 2002, as per section 181 of the Fair Work Act 2009. The case was heard by the Fair Work Commission, presided over by Deputy President C Jackson. The key legal issue the court had to decide was whether the default period should be extended, considering the economic and operational impacts of the COVID-19 pandemic on the hospitality industry.

The court examined the evidence presented by the hotel, including financial data and testimony from management, to assess the impact of the pandemic on their business. The hotel argued that the extension was necessary to prevent financial collapse and protect jobs, given the unprecedented downturn in the industry. The ALEA, on the other hand, opposed the extension, citing concerns about the potential erosion of employee rights and the precedent it could set for future negotiations. The court had to balance the hotel's need for financial stability with the rights of employees to fair and equitable working conditions.

The Fair Work Commission determined that the evidence supported the hotel's claim for an extension. The court recognised the significant financial distress caused by the pandemic and acknowledged the hotel's efforts to mitigate job losses. Deputy President Jackson concluded that the extension was necessary to allow the parties to negotiate a new agreement under more stable conditions. The court's decision was based on the specific circumstances of the case and the broader economic context, rather than setting a broad precedent for similar applications. The final orders included an extension of the default period for the East End Hotel Certified Agreement 2002 until a new agreement was reached or until further order of the Commission.

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