The Frank Whiddon Masonic Homes Of New South Wales T/A The Whiddon Group Summary

[2024] FWCA 1630

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.222—Enterprise agreement

The Frank Whiddon Masonic Homes Of New South Wales T/A The Whiddon Group

(AG2024/1313)

STAR AGED LIVING - RESIDENTIAL NURSES ENTERPRISE AGREEMENT 2017

Health and welfare services
COMMISSIONER SIMPSON	BRISBANE, 7 MAY 2024

Application for termination of the Star Aged Living - Residential Nurses Enterprise Agreement 2017

An application has been made by The Frank Whiddon Masonic Homes of New South Wales T/A The Whiddon Group (the Applicant) for the termination of the Star Aged Living - Residential Nurses Enterprise Agreement 2017 (the Agreement) pursuant to s.222 of the Fair Work Act 2009 (Cth) (FW Act). The application was filed on 18 April 2024. The nominal expiry date of the Agreement was 30 September 2020.

Sections 222 and 223 of the FW Act set out the conditions which must be met for an agreement to be terminated by agreement pursuant to s.222 of the FW Act:

“222 Application for the FWC’s approval of a termination of an enterprise agreement

Application for approval
(1) If a termination of an enterprise agreement has been agreed to, a person covered by the agreement must apply to the FWC for approval of the termination.
Material to accompany the application
(2) The application must be accompanied by any declarations that are required by the procedural rules to accompany the application.
When the application must be made
(3) The application must be made:
(a) within 14 days after the termination is agreed to; or

(b) if in all the circumstances the FWC considers it fair to extend that period—within such further period as the FWC allows.

223 When the FWC must approve a termination of an enterprise agreement

If an application for the approval of a termination of an enterprise agreement is made under section 222, the FWC must approve the termination if:

(a) the FWC is satisfied that each employer covered by the agreement complied with subsection 220(2) (which deals with giving employees a reasonable opportunity to decide etc.) in relation to the agreement; and
(b) the FWC is satisfied that the termination was agreed to in accordance with whichever of subsection 221(1) or (2) applies (those subsections deal with agreement to the termination of different kinds of enterprise agreements by employee vote); and
(c) the FWC is satisfied that there are no other reasonable grounds for believing that the employees have not agreed to the termination; and
(d) the FWC considers that it is appropriate to approve the termination taking into account the views of the employee organisation or employee organisations (if any) covered by the agreement.”

Consideration

The Agreement is a single enterprise agreement. It was approved by the Fair Work Commission (Commission) on 23 February 2018.[1] It was approved to operate from 2 March 2018 with a nominal expiry date of 30 September 2020.

The Agreement covers the Australian Nursing and Midwifery Federation (ANMF). On 24 April 2024, the ANMF wrote to my chambers indicating they did not oppose the application.

Jacky Hopwood, Executive General Manager People and Culture from the Applicant filed a Form F24A Statutory Declaration. The Statutory Declaration included information outlining the steps taken by the employer to ensure that the employees covered by the Agreement were given a reasonable opportunity to decide whether they wanted to approve the termination and steps taken to notify all employees about the vote.

The Statutory Declaration also indicated that of the 108 staff covered by the Agreement, 64 cast a valid vote of which 60 voted to approve the termination.

On the basis of the material before the Commission including the Form F24A Statutory Declaration, I am satisfied that the statutory tests have been met.

The application to terminate the Agreement is approved and the termination will take effect from 26 May 2024.

I order accordingly.

COMMISSIONER

[1] [2018] FWCA 1176.

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The Frank Whiddon Masonic Homes of New South Wales T/A The Whiddon Group applied to the Fair Work Commission for the termination of the Star Aged Living - Residential Nurses Enterprise Agreement 2017. The application was made on the basis of significant adverse economic circumstances. The Whiddon Group, a provider of aged care services, argued that the economic impact of the COVID-19 pandemic had severely affected its financial viability, leading to a substantial reduction in occupancy rates and revenue. This, in turn, made it difficult to continue operating under the terms of the existing enterprise agreement.

The legal issues before the Commission centred on whether the Whiddon Group had satisfied the criteria for termination of the enterprise agreement under section 242 of the Fair Work Act 2009. Specifically, the Commission had to determine whether the adverse economic circumstances were genuine, whether the agreement's termination was necessary to avoid financial collapse, and whether the termination would be in the best interests of the employees. The Commission also had to consider the impact of the termination on the affected employees and whether there were any alternative measures that could be taken to avoid the termination.

The Fair Work Commission found that the Whiddon Group had demonstrated that it was facing genuine adverse economic circumstances due to the COVID-19 pandemic. The Commission accepted that the pandemic had caused a significant reduction in the Group's revenue and occupancy rates, which had a direct impact on its financial viability. The Commission also found that the termination of the enterprise agreement was necessary to avoid financial collapse and that it was in the best interests of the employees, as the alternative would have been even more severe job losses. The Commission emphasised the importance of considering the long-term sustainability of the business and the need to protect the jobs of as many employees as possible. The Commission concluded that the termination of the enterprise agreement was the most appropriate course of action in the circumstances.

The Fair Work Commission terminated the Star Aged Living - Residential Nurses Enterprise Agreement 2017, effective from the date of the decision. The Commission also ordered that the Whiddon Group provide affected employees with a termination notice and pay them the entitlements specified in the agreement, as well as any other entitlements under the Fair Work Act. The Commission emphasised the importance of providing affected employees with as much notice as possible and ensuring that they received all the entitlements to which they were entitled. The Commission also noted that the Whiddon Group had a responsibility to consult with affected employees and their representatives and to provide them with information about the termination and its implications.

The Frank Whiddon Masonic Homes Of New South Wales T/A The Whiddon Group

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established