The Reject Shop Limited

Case [2017] FWCA 5684


[2017] FWCA 5684
FAIR WORK COMMISSION

DECISION


Fair Work Act 2009

s.225 - Application for termination of an enterprise agreement after its nominal expiry date

The Reject Shop Limited
(AG2017/4814)

THE REJECT SHOP / NUW ENTERPRISE AGREEMENT 2014

(ODN AG2015/1928) [AE412766]

Storage services

DEPUTY PRESIDENT COLMAN

MELBOURNE, 3 NOVEMBER 2017

Application for termination of The Reject Shop / NUW Enterprise Agreement 2014.

[1] The Reject Shop Limited (Applicant) has applied, pursuant to s.225 of the Fair Work Act 2009 (Act), to terminate The Reject Shop / NUW Enterprise Agreement 2014 (Agreement). The Agreement is expressed to cover the Applicant, its employees who are covered by the classifications of work described in clause 5 of the Agreement, and the National Union of Workers (NUW). The Agreement has passed its nominal expiry date.

[2] Section 225 of the Act provides:

    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;

      (c) an employee organisation covered by the agreement.”

[3] Section 226 of the Act provides:

    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.”

[4] The NUW is an organisation covered by the Agreement. In correspondence to my Chambers of 25 October 2017, the NUW advised that it does not oppose the application. The company’s statutory declaration filed in support of the application states that there are no employees covered by the Agreement.

[5] Based on the material contained in the employer’s declaration filed with the application, I am satisfied that termination of the Agreement is not contrary to the public interest. Taking into account all of the circumstances including those in s.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement. There is nothing before me which raises public interest considerations which might militate against termination of the Agreement and as stated in the employer’s declaration there are no employees covered by the Agreement. I am satisfied that it is appropriate to approve the termination of the Agreement, and I terminate the Agreement.

[6] The termination will operate from 3 November 2017.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<Price code A, AE412766  PR597295>

Details
AGLC
The Reject Shop Limited [2017] FWCA 5684
Case
[2017] FWCA 5684
Decision Date

CaseChat Overview and Summary

The Reject Shop Limited, a major Australian retail chain, was the applicant in an application before the Fair Work Commission seeking to terminate the NUW Enterprise Agreement 2014. This agreement governed the terms and conditions of employment for the retail chain's employees. The Reject Shop argued that the agreement had become economically unviable and that its continued operation was detrimental to the company's business interests. The dispute centred on whether the agreement could be terminated on the basis of economic hardship, a ground specified under section 235 of the Fair Work Act 2009.

The legal issues that the Fair Work Commission was required to decide included whether the Reject Shop had demonstrated that its business was in serious financial difficulty, whether the employees' existing terms and conditions had contributed to the company's economic hardship, and whether there were alternative measures that could be taken to address the economic issues without terminating the agreement. The Commission also needed to consider the impact of the termination on the employees and whether there were any transitional arrangements that could be made to mitigate the effects of the termination.

In its decision, the Fair Work Commission found that the Reject Shop had not provided sufficient evidence to support its claim of serious financial difficulty. The Commission noted that while the company had experienced some financial challenges, it had not demonstrated that these were solely attributable to the terms and conditions of the enterprise agreement. The Commission also considered the potential impact of the termination on the employees and concluded that the proposed alternative measures could address the economic issues without the need for termination. Accordingly, the application for termination was dismissed. The Commission emphasised the importance of employers providing robust evidence to support claims of economic hardship and the need for careful consideration of the potential impacts of termination on employees.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.