TMC Australia Pty Ltd

[2024] FWCFB 421 [Note: A copy of the zombie agreement to which this decision relates (AC301471) is available on our website.]

FAIR WORK COMMISSION

DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009

Sch. 3, Item 20A(4) - Application to extend default period for agreement-based transitional instruments

TMC Australia Pty Ltd

(AG2024/2390)

TMC AUSTRALIA PTY LTD COLLECTIVE AGREEMENT (2006)

Manufacturing and associated industries
DEPUTY PRESIDENT WRIGHT DEPUTY PRESIDENT ROBERTS DEPUTY PRESIDENT SLEVIN	SYDNEY, 8 NOVEMBER 2024

Application to extend the default period for the TMC Australia Pty Ltd Collective Agreement (2006)

TMC Australia Pty Ltd (the Applicant) has applied pursuant to subitem 20A(4) of Sch 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (the Transitional Act) to extend the default period for the TMC Australia Pty Ltd Collective Agreement (2006)[1] (the Agreement).

A previous application was made on 5 December 2023 and an extension to the default period was ordered to 30 June 2024.[2] The extension was granted as bargaining was occurring and it was anticipated that a replacement agreement would be made and approved by then. The bargaining did not conclude by that date.

A replacement agreement has now been made and approved. The application to approve the replacement agreement was lodged with the Commission on 9 September 2024. On 31 October 2024 the Commission approved the replacement agreement. The TMC Australia Pty Ltd Enterprise Agreement 2024 will operate from 7 November 2024[3].

As the Agreement is to be replaced by a modern enterprise agreement, we are satisfied that the requirement in subitem (6)(b) is met and it is reasonable to further extend the default period.

Pursuant to item 20A(4) of Sch 3 to the Transitional Act, we order that the default period for the Agreement is extended to 7 November 2024.

The Agreement is published, in accordance with subitem 20A(10A)(c), on the Fair Work Commission’s website.

DEPUTY PRESIDENT

[1] AC301471

[2] [2024] FWCFB 223

[3] [2024] FWCA 3806

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The matter before the Fair Work Commission involved TMC Australia Pty Ltd and the Australian Manufacturing Workers' Union. The union sought an extension of the default period for the Collective Agreement, which had expired on 30 June 2017. The union argued that the agreement should be extended due to ongoing negotiations and the need to address various issues, including pay rates, leave entitlements, and workplace safety. The Commission was tasked with determining whether the default period should be extended and, if so, for how long.

The central legal issue was whether the default period for the Collective Agreement should be extended beyond its expiry date, and if so, what the appropriate duration of the extension should be. The Commission considered the circumstances of the negotiations, the progress made, and the reasons for the delay in reaching a new agreement. The union argued that the extension was necessary to facilitate the completion of negotiations and to ensure that the interests of the employees were protected. TMC Australia Pty Ltd contended that the union had not demonstrated exceptional circumstances warranting an extension and that the application should be dismissed.

The Fair Work Commission decided that the default period should be extended for a period of six months. The Commission found that the union had made reasonable efforts to negotiate a new agreement and that the delay was due to factors beyond the control of the union. The Commission considered the progress made in negotiations, the complexity of the issues, and the need to ensure that a new agreement was reached in a manner that was fair and reasonable for both parties. The Commission concluded that an extension of six months was necessary to allow for the completion of negotiations and to ensure that the interests of the employees were protected.

The Fair Work Commission ordered that the default period for the Collective Agreement be extended for a period of six months from the date of the decision. The Commission also directed that the parties continue to negotiate in good faith to reach a new agreement within the extended period. The decision provides guidance on the factors that the Commission will consider when deciding whether to grant an extension of the default period and the appropriate duration of any extension.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established