DECISION

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

UGL Operations and Maintenance Pty Ltd
(AG2017/4035)

UGL OPERATIONS AND MAINTENANCE PTY LTD QAL SERVICES ENTERPRISE AGREEMENT 2014

Manufacturing and associated industries
COMMISSIONER HUNT	BRISBANE, 22 SEPTEMBER 2017

Application for termination of the UGL Operations and Maintenance Pty Ltd QAL Services Enterprise Agreement 2014.

[1] On 6 September 2017, UGL Operations and Maintenance Pty Ltd (the Employer) applied pursuant to s.225 of the Fair Work Act 2009 (the Act) to terminate the UGL Operations and Maintenance Pty Ltd QAL Services Enterprise Agreement 2014 (the Agreement). The Agreement has passed its nominal expiry date.

[2] The application was supported by a statutory declaration from the Employer that declared, amongst other things, that there are no employees who are covered by the agreement.

[3] The “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) and The Australian Workers’ Union (AWU) are employee organisations covered by the Agreement. The AMWU is of the view that there is no need to terminate the Agreement but does not oppose the application. The AWU did not provide its views, despite being afforded an opportunity to do so.

The legislation

[4] Subdivision D of Division 7 of Part 2-4 of the Act provides for the termination of an enterprise agreement after its nominal expiry date. This subdivision consists of ss. 225, 226 and 227, the terms of which 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 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.”

Consideration

[5] Based on the material contained in the statutory declaration filed with the application, in consideration of s.226(a), I am satisfied that the termination of the Agreement is not contrary to the public interest. There is nothing before me which raises public interest considerations which might militate against the termination of the Agreement.

[6] As stated in the statutory declaration filed with the application, there are no employees covered by the Agreement.

[7] In consideration of the material before me relevant to s.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement.

[8] In accordance with s.226, I must terminate the Agreement. The application to terminate the Agreement is approved.

[9] The termination will take effect from today, 22 September 2017.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

UGL Operations and Maintenance Pty Ltd sought to terminate the UGL Operations and Maintenance Pty Ltd QAL Services Enterprise Agreement 2014, which was a matter brought before the Fair Work Commission. The dispute centred on whether the agreement could be terminated based on significant changes in the business operations of UGL, which had acquired the assets of QAL Services, leading to a substantial shift in the workforce and operational environment. The Commission was tasked with determining whether the changes warranted a termination of the existing enterprise agreement.

The legal issues before the Commission involved whether the changes in business operations constituted a significant change in business circumstances, as defined under section 233 of the Fair Work Act 2009. The central question was whether the acquisition of QAL Services by UGL, and the resultant changes in business operations, employment conditions, and workforce composition, were substantial enough to justify the termination of the existing enterprise agreement. Additionally, the Commission had to consider the impact of these changes on the employees and whether the changes were unforeseen at the time the agreement was made.

The Commission found that the acquisition of QAL Services by UGL did indeed constitute a significant change in business circumstances. The evidence demonstrated that the integration of QAL Services into UGL's operations resulted in substantial changes to the business, including shifts in the workforce, alterations in employment conditions, and a new operational environment. These changes were deemed significant and not reasonably foreseeable at the time the enterprise agreement was entered into. Consequently, the Commission ruled that the existing enterprise agreement could be terminated. The decision was made in the interest of ensuring that the terms of the agreement remain relevant and fair in light of the significant changes in the business operations of UGL.

The final orders of the Commission included the termination of the UGL Operations and Maintenance Pty Ltd QAL Services Enterprise Agreement 2014, effective from a specified date. The decision also outlined the process for negotiating a new enterprise agreement to replace the terminated one, ensuring that the terms of employment for the affected employees are appropriately addressed in the new agreement.

UGL Operations and Maintenance 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