UGL Operations & Maintenance Pty Ltd
[2022] FWCA 1647
•19 MAY 2022
| [2022] FWCA 1647 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.225—Enterprise agreement
UGL Operations & Maintenance Pty Ltd
(AG2022/728)
| Oil and gas industry | |
| DEPUTY PRESIDENT BINET | PERTH, 19 MAY 2022 |
Application for termination of the UGL Operations & Maintenance Pty Ltd BP Refinery (Kwinana) Site Maintenance and Modification Enterprise Agreement 2018
UGL Operations and Maintenance Pty Ltd (UGL) has made an application (Application) to the Fair Work Commission (FWC) to terminate the UGL Operations & Maintenance Pty Ltd BP Refinery (Kwinana) Site Maintenance and Modification Enterprise Agreement 2018 (Agreement) pursuant to section 225 of the Fair Work Act 2009 (Cth) (FW Act).
The Agreement was approved by Commissioner Cirkovic pursuant to section 185 of the FW Act, on 1 April 2019 and, commenced operation on 8 April 2019. The Agreement had a nominal expiry date of 28 February 2022.
The parties to the Agreement are UGL and employees employed in classifications specified in Clause 17 of the Agreement who are employed to undertake maintenance and modification work (demolition and modification included) to refinery plant, and brownfields projects and excludes construction work for which separate conditions apply (Employees).
The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) are covered by the Agreement.
In support of the Application, UGL filed a statutory declaration by Ms Stephanie Evans, Industrial Relations Advisor (Evans Declaration).
On 24 March 2022, directions were issued with respect to the Application (Directions). The Directions required UGL to file an outline of submissions in support of the Application and any evidence on which UGL sought to rely. The Directions required the AMWU to file an outline of submissions in response to the Application and any evidence on which the AMWU sought to rely.
The parties were invited to make oral submissions in relation to the Application. Both parties confirmed that they did not seek to be heard and were content for the Application to be determined on the papers.
Legislation
Subdivision D of Division 7 of Part 2-4 of the FW Act sets out the mechanism by which an enterprise agreement may be terminated after the agreement has passed its nominal expiry date.
Section 225 of the FW Act provides that:
“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.”
As the Agreement has passed its nominal expiry date and UGL is an employer covered by the Agreement, I find that UGL has standing to make the Application pursuant to section 225(a) of the FW Act.
Section 226 of the FW Act states:
“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.”
Is it contrary to the public interest to termination the Agreement?
Section 226(a) requires the FWC to be satisfied that it is not contrary to the public interest to terminate the Agreement.
This requires the FWC to consider how the termination of the Agreement might foreseeably affect the public as a whole, such as the impact on the achievement or otherwise of the various objects of the Act, employment levels, inflation and the maintenance of proper industrial standards.[1]
The object of the FW Act is set out in section 3 of the FW Act, as follows:
“3. Object of this Act
The object of this Act is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians by:
…
(b)ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards, modern awards and national minimum wage orders;
…
(f)achieving productivity and fairness through an emphasis on enterprise level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action;
…”
The specific objects in section 171 of the FW Act inform how the general object in section 3 of the FW Act is to be satisfied in the context of matters dealt with in Part 2-4 of the FW Act:
“171.Objects of this Part
The objects of this Part are:
(a) to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and
(b) to enable the FWC to facilitate good faith bargaining and the making of enterprise agreements, including through:
(i)making bargaining orders; and
(ii)dealing with disputes where the bargaining representatives request assistance; and
(iii)ensuring that applications to the FWC for approval of enterprise agreements are dealt with without delay.”
The public interest is distinct in nature from the interests of those covered by the agreement. The views of those covered by an agreement may be relevant to the exercise of the discretion if they shed light on the effect of the termination on public interest but those views should not be given any independent weight.[2]
The ascertainment of what is not in the public interest does not involve the mere identification of a consequence of the termination of the agreement that is arguably contrary to the public interest. The ascertainment of the public interest may involve balancing countervailing public interests.[3]
There is no positive onus on the applicant to persuade the FWC that there are positive benefits to the public interest arising from the termination. In Geelong Wool Combing Ltd (AIRC) 5 September 2003, Commissioner Wheelan said:
“… the Commission must be persuaded that termination is contrary to the public interest [and] in the absence of any effect of termination which is contrary to the public interest it is not necessary to persuade the Commission that there are positive benefits to the public interest arising from the termination.”
UGL submits that it is not contrary to the public interest to terminate the Agreement because:
a.The Agreement has passed its nominal expiry date.
b.There have been no employees employed by UGL under the Agreement since August 2019.
c.UGL has no intention to engage any employees under the Agreement as the work that was previously undertaken under this Agreement is no longer undertaken.
Based on the submissions of UGL and the evidence before me, I am satisfied that it is not contrary to the public interest to terminate the Agreement.
What are the views of the Employees covered by the Agreement?
There are currently no employees performing work covered by the Agreement and there has not been any employees performing work covered by the Agreement since August 2019.
What are the views of the Employee Organisation covered by the Agreement?
The Agreement covers the AMWU. Directions were issued on 24 March 2022 seeking the views of the AMWU by 7 April 2022. On 19 April 2022 the AMWU informed the FWC that the AMWU had reviewed the materials filed by UGL and agree that it is appropriate that the Agreement be terminated.
What are the views of the Employer covered by the Agreement?
UGL wish to terminate the Agreement.
What are the circumstances of the Employee Organisation covered by the Agreement?
The AMWU agree that it is appropriate that the Agreement be terminated.
What are the circumstances of the Employer covered by the Agreement?
UGL currently have no employees covered by the Agreement and has no intention to engage any employees under the Agreement into the future. UGL state that terminating the Agreement would result in UGL having one less ‘historical enterprise agreement to monitor and administer’.
Is it appropriate to terminate the Agreement taking into all the circumstances?
In assessing the views and circumstances of the parties it is important to remember that:
“Taking into account the views and circumstances of the parties involves far more than an expression of their views in support or opposition to termination. It should involve a reason for their views and the validity of their concerns.”[4]
I am satisfied that the views of UGL and the AMWU that the Agreement should be terminated are valid. The Agreement passed its nominal expiry date some time ago and its terms and conditions are not comparable to more recently approved enterprise agreements.
Conclusion
For the reasons enunciated above, I am satisfied that it is not contrary to the public interest to terminate the Agreement.
Taking into account all the circumstances, including the views and circumstances of UGL and the AMWU, I am satisfied that it is appropriate to terminate the Agreement.
Accordingly, the Agreement is terminated. The termination is to take effect on and from the date of this Decision. An Order to this effect will be issued in conjunction with this Decision.[5]
DEPUTY PRESIDENT
Printed by authority of the Commonwealth Government Printer
<AE502627,PR741762>
[1] Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000 (2005) 139 IR 34, 40 – 41.
[2] Ibid.
[3] Kellogg Brown & Root Pty Ltd & Ors and Esso Australia Ltd (2005) 139 IR 34 referred to the decision of the High Court of Australia in Queensland Electricity Commission; Ex parte Electrical Trades Union of Australia (1987) 61 ALJR 393.
[4] Energy Resources Australia Ltd v Liquor, Hospitality and Miscellaneous Union[2010] FWA 2434, [16].
[5] PR741763.
Printed by authority of the Commonwealth Government Printer
<AE502627,PR741762>
0
0
0