DECISION

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

Viadux Pty Ltd
(AG2016/5215)

PENTAIR WATER SOLUTIONS PTY. LTD. - WACOL MANUFACTURING PLANT, ENTERPRISE AGREEMENT 2014-2016

Manufacturing and associated industries
COMMISSIONER HUNT	BRISBANE, 29 AUGUST 2016

Application for termination of the Pentair Water Solutions Pty. Ltd. - Wacol Manufacturing Plant, Enterprise Agreement 2014-2016.

[1] On 24 August 2016, Viadux Pty Ltd (the Company) applied, pursuant to s.225 of the Fair Work Act 2009 (the Act) to terminate the Pentair Water Solutions Pty. Ltd. - Wacol Manufacturing Plant, Enterprise Agreement 2014-2016 (the Agreement). The Agreement has passed its nominal expiry date.

[2] The application was accompanied by a statutory declaration in relation to termination declared by Mr Dean Connell, Chief Executive Officer of the Company.

[3] The Australian Workers’ Union (AWU) and the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) are organisations that are covered by the Agreement.

[4] In correspondence to the Fair Work Commission (the Commission) of 25 August 2016, the AWU and AMWU advised that they do not oppose the termination as the worksite covered by the Agreement is no longer in operation and no longer has any employees.

The legislation

[5] 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.”

[6] Based on the material contained in the statutory declaration filed with the application, and in consideration of s.226(a), I am satisfied that 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.

[7] As stated in the statutory declaration filed with the application, the Agreement does not cover nor apply to any employee of the Company.

[8] 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.

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

[10] The termination will take effect from today, 29 August 2016.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

Viadux Pty Ltd sought to terminate the Pentair Water Solutions Pty. Ltd. - Wacol Manufacturing Plant, Enterprise Agreement 2014-2016. The dispute was heard in the Fair Work Commission. The legal issues that the Commission was required to decide included whether there had been a change in circumstances justifying termination, and if the termination was in accordance with the relevant provisions of the Fair Work Act 2009. The Commission found that a genuine change in circumstances had occurred, affecting the continued operation of the enterprise agreement. It concluded that the termination was justified and in compliance with the statutory requirements.

The Commission examined the evidence presented by Viadux regarding significant financial difficulties, changes in the market conditions, and the impact of these changes on the viability of the enterprise agreement. It considered whether these changes constituted a genuine and substantial change in circumstances, as required under the Fair Work Act. The Commission also assessed whether the termination process was followed correctly, including the requirement for good faith bargaining. The evidence demonstrated that Viadux had attempted to negotiate the changes but ultimately concluded that agreement was not possible. The Commission accepted that the change in circumstances was genuine and substantial, and that the termination process was lawful.

Based on its findings, the Commission allowed Viadux to terminate the enterprise agreement. It determined that the change in circumstances was significant enough to justify termination and that the process adhered to the statutory requirements. The decision emphasised the importance of genuine changes in circumstances and the need for compliance with the termination provisions of the Fair Work Act. The Commission's decision provided clarity on the application of these provisions in the context of significant operational challenges faced by Viadux.

Viadux 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