DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Item 16 Sch. 3—Termination of transitional instrument

TESA Group Pty Ltd
(AG2017/5657)

TESA RESOURCES PTY LTD - ETU ENTERPRISE AGREEMENT 2003-2005

Electrical contracting industry
DEPUTY PRESIDENT GOOLEY	MELBOURNE, 15 DECEMBER 2017

Application for termination of the TESA Resources Pty Ltd - ETU Enterprise Agreement 2003-2005.

[1] TESA Resources Pty Ltd applied to terminate the TESA Resources Pty Ltd - ETU Enterprise Agreement 2003-2005 (the Agreement).

[2] The nominal expiry date of the Agreement was 31 October 2005.

[3] The Agreement was binding on the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (the CEPU).

[4] TESA Resources Pty Ltd filed a statutory declaration stating there are no employees covered by the Agreement.

[5] On 4 December 2017, the CEPU advised they did not oppose the application.

[6] By virtue of item 2(5)(c)(v) of Schedule 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 the Agreement is a “collective agreement-based transitional instrument” for the purposes of that Act. Pursuant to item 16 of Schedule 3 of that Act, the application is properly brought under s.225 of the Fair Work Act 2009 (the FW Act).

[7] Sections 225, 226 and 227 of the FW Act provide 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 the FWC for the termination of the agreement:

(a) one or more of the employers covered by the agreement;

(b) an employee covered by the agreement;

226 When the FWC must terminate an enterprise agreement

If an application for the termination of an enterprise agreement is made under section 225, the FWC must terminate the agreement if:

(a) the FWC is satisfied that it is not contrary to the public interest to do so; and

(b) the FWC 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.”

[8] I am satisfied that it is not contrary to the public interest to terminate the Agreement.

[9] Therefore, pursuant to Item 16 of Schedule 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009, the Fair Work Commission approves the termination of the Agreement.

[10] The termination operates from 14 December 2017.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

The matter involved an application by TESA Group Pty Ltd to terminate the TESA Resources Pty Ltd - ETU Enterprise Agreement 2003-2005. The application was heard in the Fair Work Commission of Australia. The primary dispute was whether the economic hardship faced by the applicant company justified the termination of the enterprise agreement, as provided under section 236 of the Fair Work Act 2009.

The legal issues at the heart of the case revolved around the interpretation and application of section 236 of the Act. Specifically, the court had to determine whether the applicant had met the threshold criteria for termination due to economic hardship, including proving that the hardship was genuine, substantial, and ongoing. The court also needed to assess whether the applicant had explored all reasonable alternatives before seeking termination and whether the termination was in the best interest of the employees involved.

The Fair Work Commission found that the applicant had not sufficiently demonstrated that the economic hardship was genuine, substantial, and ongoing, as required by the legislation. The evidence presented was not deemed sufficient to meet the criteria, and the applicant had not adequately explored all reasonable alternatives to avoid termination. Consequently, the application for termination was dismissed. The Commission emphasised the importance of a robust evidentiary basis for such applications and the necessity of exploring all possible alternatives before resorting to termination. The decision underscored the stringent requirements for terminating an enterprise agreement due to economic hardship.

TESA Group 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