St Laurence Community Services Inc

[2010] FWA 3088

[2010] FWA 3088

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.225 – Application for termination of an enterprise agreement after its nominal expiry date

St Laurence Community Services Inc
(AG2010/7003)

COMMISSIONER GOOLEY MELBOURNE, 15 APRIL 2010

St Laurence Home Support Services Enterprise Agreement 2006-2009

[1] This decision concerns an application by St Laurence Community Services Inc (St Laurence) to terminate the St Laurence Home Support Services Enterprise Agreement 2006-2009 (the Agreement) pursuant to section 225 of the Fair Work Act 2009 (the FW Act).

[2] Schedule 3 item 16 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the Transitional Act) provides that Subdivision D of Division 7 of Part 2-4 of the FW Act applies in relation to a collective agreement-based transitional instrument as if a reference to an enterprise agreement included a reference to a collective agreement-based transitional instrument.

[3] The Agreement is a collective agreement-based transitional instrument and its nominal expiry date was 31 December 2009.

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

“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.

227 When termination comes into operation

If an enterprise agreement is terminated under section 226, the termination operates from the day specified in the decision to terminate the agreement.”

[5] On 23 March 2010 a notice of listing was provided to St Laurence who were directed to notify all employees of the hearing date not less than 14 days prior to the hearing and to post a copy of the application and the notice of listing on all staff or employee noticeboards with an indication that employees may appear before and make submissions to Fair Work Australia or provide a copy of the application and notice of listing to all employees.

[6] On 8 April 2010 Mr Betts, the Human Resources Manager appeared on behalf of St Laurence. No employees appeared at the hearing.

[7] Mr Betts advised that St Laurence had complied with the directions.

[8] Mr Betts explained that St Laurence had met with a group of employees in December 2009 to discuss what would occur upon the expiry of the Agreement and it was decided that a proposal be put to employees that:

1. upon the expiry of the Agreement employees would revert to the Social, Community, Home Care, Disability Services Industry Award 2010 (the modern award);

2. all future pay increases will be in line with decisions of Fair Work Australia and that the wage increases will be passed on to all employees;

3. if the proposal is accepted all employees would receive a pay increase of 4% from 1 January 2010;

4. St Laurence would continue to maintain the 50/52 week employment cycle and paid paternity/adoption leave with an increase in the period of paid leave from two weeks to four weeks.

[9] Employees were asked to indicate their acceptance or rejection of this proposal by 22 January 2010. Mr Betts advised that this date was extended.

[10] He advised that 34 of the 55 employees responded with 33 employees accepting the proposal and one employee rejecting the proposal.

[11] In response to my question about the transition provisions in the modern award Mr Betts advised that St Laurence would apply the modern award excluding the transition provisions. For example the predecessor instrument provided for a 20% casual loading while the modern award provides for a 25% loading. St Laurence intends from the date of termination to apply the 25% loading.

[12] Mr Betts explained that apart from the change to the notice of shift cancellation there is no reduction in wages or entitlements that will occur as a result of the termination of the Agreement.

[13] Mr Betts submitted that the rates of pay for employees currently exceeded the rates in the modern award and the rates with the 4% increase would be offered to new employees along with existing employees.

[14] Mr Betts advised that upon the termination of the Agreement all employees would be provided with a letter setting out the variation to their employment contracts which would provide for the application of the modern award excluding the transition provisions and the over award entitlements that are to be preserved.

[15] No submissions were made that termination of the Agreement was contrary to the public interest.

[16] No employees have made submissions opposing the termination of the Agreement and the submissions of Mr Betts indicated that employees have been advised of the implications of the reversion to the modern award, have been advised of the undertakings given by St Laurence and supported the decision to revert to the modern award.

[17] I am satisfied that it is not contrary to the public interest to terminate the Agreement and it is appropriate to terminate the Agreement having regard to all the circumstances of the matter. I am therefore required by section 226 of the FW Act to terminate the Agreement. I will issue an order to that effect in conjunction with handing down this decision.

COMMISSIONER

Appearances:

P Betts for St Laurence Community Services Inc

Hearing details:

2010.

Melbourne:

April 8.

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