Uptime Management Services Pty Ltd v "Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU)
[2015] FWCA 8244
•30 NOVEMBER 2015
| [2015] FWCA 8244 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.225 – Application to terminate an enterprise agreement that has passed its nominal expiry date
Uptime Management Services Pty Ltd
v
"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU)
(AG2015/4317)
Manufacturing and associated industries | |
DEPUTY PRESIDENT GOSTENCNIK | MELBOURNE, 30 NOVEMBER 2015 |
Application for termination of the Uptime Management Services Pty Ltd and AMWU Geelong Area Agreement 2011-2014; Agreement does not cover any employees and is not likely to do so in the foreseeable future; termination not contrary to the public interest; appropriate to terminate the Agreement; Agreement terminated with effect on 1 December 2015.
Introduction
[1] Uptime Management Services Pty Ltd (Applicant) is covered by an enterprise agreement titled the Uptime Management Services Pty Ltd and AMWU Geelong Area Agreement 2011 – 2014 (Agreement). The Agreement was approved by Fair Work Australia pursuant to s.186 of the Fair Work Act 2009 (Act) on 6 January 2012. The Agreement commenced operation on 13 January 2012 and the nominal expiry date of the Agreement of 30 June 2014 has passed.
[2] The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) is also covered by the Agreement.
[3] By its amended application, the Applicant has applied under s.225 of the Act for the termination of the Agreement pursuant to s.226 of the Act. The AMWU opposes the application.
Background
[4] The following matters are not contested. The scope of the Agreement is limited in its application relevantly to employees of the Applicant in classifications covered by the Manufacturing and Associated Industries and Occupations Award 2010 employed at the Applicant’s establishment located at 35-37 Hume Reserve, North Geelong in the State of Victoria. 1
[5] The Applicant does not now have and has not since 9 July 2015 had, in its employ, any person performing work within the scope of the Agreement. 2 The Applicant’s primary business is no longer at the Geelong site specified in the scope clause of the Agreement and the workshop previously operated by the Applicant in which employees covered by the Agreement were engaged has since been converted into a warehouse.3
[6] The Applicant does not intend to resume operations at the Geelong site in which persons covered by the Agreement had previously worked in the foreseeable future. 4
Relevant legislative provisions
[7] The legislative mechanisms by which an enterprise agreement may be varied or terminated are dealt with in Division 7 of Part 2–4 of the Act. Subdivision C of Division 7 sets out the manner in which an enterprise agreement may be terminated by agreement and for the approval of the termination of the enterprise agreement by the Fair Work Commission (Commission).
[8] Subdivision D of Division 7 contains provisions which enable the termination of an enterprise agreement to be terminated after the agreement has passed its nominal expiry date.
[9] These provisions are as follows:
‘Subdivision D—Termination of enterprise agreements after nominal expiry date
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.
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.’
[10] As a Full Bench of this Commission observed in Aurizon Operations Limited; Aurizon Network Pty Ltd; Australia Eastern Railroad Pty Ltd (Aurizon), 5 these provisions, and relevantly s.226, must be construed in a manner that is consistent with the language and purpose of the provisions by reference to the language of the Act as a whole, and so the context, general purpose and policy of the provision are an important means by which the meaning and effect of a provision is to be ascertained.6
[11] The Full Bench in Aurizon discussed in some detail, the operation and proper application of s.226 of the Act and the ‘not contrary to the public interest’ consideration contained therein. 7 I adopt that approach without repeating it.
Consideration
Section 226(a)
[12] The gravamen of the objection to the termination of the Agreement raised by the AMWU is that it would be contrary to the public interest to terminate an agreement containing a provision which limits the way in which that agreement may be terminated.
[13] Clause 4 of the Agreement provides the following:
‘The Agreement commences from 1 July 2011 8 and it will continue in force until varied, terminated or replaced by agreement of the parties to this Agreement.’
[14] The AMWU submitted that on a proper construction of clause 4, the Agreement could only be terminated by ‘agreement of the parties’ to the Agreement. The Applicant maintained that the requirement that there be agreement of the parties related only to replacing the Agreement and not to the first two mentioned modes.
[15] I have found it unnecessary to resolve the disputed construction of clause 4 as for the reasons which follow, even if I accept the AMWU’s construction of clause 4, I am nevertheless satisfied that in the circumstances of this case, termination of the Agreement is not contrary to the public interest. I do, however, express a preliminary view without deciding the point that the phrase ‘varied, terminated or replaced by agreement of the parties’ appearing in clause 4 seems to me to be a compound phrase with the effect that the requirement that there be agreement of the parties applies to all three modes that might affect the continued operation of the Agreement described in clause 4. This construction seems to me consistent with the syntax of the sentence as a whole so that the individual words ‘varied, terminated or replaced’ are not construed in the abstract but have their meaning affected by the other words, namely ‘agreement of the parties’.
[16] Turning then to the specific argument raised by the AMWU.
[17] The AMWU submitted that clause 4 places a fetter on the termination of the Agreement. Clause 4 requires agreement of the parties, relevantly the AMWU, before the Agreement may be terminated. There is no such accord to the termination of the Agreement.
[18] The AMWU submitted that as the condition precedent has not been met a termination of the Agreement contrary to the wishes of one of the parties is a departure from the agreed terms. That parties should be held to their bargain enlivens the public interest and in the circumstances results in a conclusion that the Commission should not be satisfied that termination of the Agreement is not contrary to the public interest.
[19] The AMWU referred me to two cases decided under similar provisions of predecessor legislation which supported its contention. 9
[20] Again, without deciding the question whether the existence of a provision in an agreement which limits the method by which it may be terminated enlivens the public interest for the purposes of s.226 of the Act and without deciding whether such a provision is repugnant to the Act under which the Agreement operates 10, it is readily apparent in the circumstances of this case that even if I accepted the proposition, termination of the Agreement is not contrary to the public interest for the following reasons.
[21] Firstly, unlike the circumstances in each of the two cases to which reference was made by the AMWU, there are no employees who are currently covered by the Agreement. Secondly, the place at which the Agreement operates no longer operates as a workshop, and the Applicant maintains, without demur from the AMWU, that it is has no intention of employing persons who would be covered by the Agreement in the foreseeable future.
[22] Thirdly, the word ‘parties’ appearing in clause 4 of the Agreement should be given the meaning ascribed to it by clause 3 of the Agreement and read in the context of the statutory framework under which the Agreement operates. When this is done, it is clear that one of the ‘parties’ to the Agreement is the employees of the Applicant who are covered by the Agreement and to whom the Agreement applies. Self-evidently no such party presently exists and is not likely to exist in the foreseeable future. The only mechanism under the Act to terminate an agreement by agreement of the ‘parties’ is that found in Subdivision C, Division 7 of Part 2–4 of the Act. Given the terms of the provisions in that subdivision it is clearly the case that termination of the Agreement by agreement of the parties cannot occur absent an approval by a majority of the employees covered by the Agreement who cast a valid vote to approve the termination of the Agreement. In the circumstances of this case, that is not possible.
[23] Fourthly, the Agreement has no current practical application and is not likely to have any practical application in the foreseeable future.
[24] In these circumstances even if it might generally be said that terminating an agreement in a manner contrary to the express conditions precedent for the termination of the Agreement set out in clause 4 would be contrary to the public interest (a proposition about which I need not express a view), in my view the matters to which I have made reference above combine to ameliorate that concern. No other public interest consideration was identified and I am not aware of any other matter which might affect my consideration of whether termination of the Agreement is contrary to the public interest. In the result, I am satisfied that the termination of the Agreement is not contrary to the public interest.
Section 226(b)
[25] Turning then to the considerations set out in s.226(b) of the Act, given that there are no employees to whom the Agreement applies I am not in a position to take into account their views. It is clear that the Applicant supports the termination of the Agreement and the AMWU, as the employee organisation covered by the Agreement, opposes its termination.
[26] Since there are no employees to whom the Agreement currently applies there are no adverse effects on those employees. The Applicant will be freed of such administrative burden that might be associated with the continued operation of the Agreement in circumstances where no employees are engaged by it that are covered by the Agreement. The AMWU did not, properly in my view, make any submission to the effect that it would be adversely affected by the termination of the Agreement in the circumstances.
[27] Taking these matters into account I consider that it is appropriate to terminate the Agreement. There is no apparent utility in its continued operation.
Conclusion
[28]
I propose to terminate the Agreement because I am satisfied for the reasons given that termination of the Agreement is not contrary to the public interest, and for the reasons given I consider that it is appropriate to terminate the Agreement. The termination operates from the day after the date of this decision.
[29] An order giving effect to this is separately made in PR574512.
DEPUTY PRESIDENT
Appearances:
J. McComb, Counsel for the Applicant.
B. Terzic on behalf of the Respondent.
Hearing details:
2015.
Melbourne.
November 20.
1 Agreement clause 3.
2 Exhibit A at [9].
3 Ibid at [10] – [11].
4 Ibid at [12].
5 [2015] FWCFB 540.
6 Ibid at [120].
7 Ibid at [118]-[152]; See also Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Aurizon Operations Ltd [2015] FCAFC 126 at [22]-[22].
8 Noting that the Agreement did not in fact commence operation until 13 January 2012 (see [2012] FWAA 146 at [4].
9 See Re Australasian Meat Industry Employees Union, Full Bench, AIRC (2004) PR952544 [dealing with an application to terminate a certified agreement under s.170MH of the Workplace Relations Act 1996] and Re BHP Coal Pty Ltd, Bacon C, AIRC (2001) PR904284 [also dealing with an application to terminate a certified agreement under s.170MH of the Workplace Relations Act 1996].
10 See Toyota Motor Corporation Australia Ltd v Marmara [2014] FCAFC 84, particularly at [74]–[110].
Printed by authority of the Commonwealth Government Printer
<Price code A, AE890740 PR574511 >
0