West Australian Newspapers Ltd

[2021] FWCA 2958

[2021] FWCA 2958

FAIR WORK COMMISSION

DECISION

Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3, Item 16 - Application to terminate collective agreement-based transitional instrument

West Australian Newspapers Ltd
(AG2021/4017)

WEST AUSTRALIAN NEWSPAPERS CLERKS (ENTERPRISE BARGAINING) AGREEMENT 2004 AND THE CLERKS’ (WEST AUSTRALIAN) SPECIAL CASUAL EMPLOYEES AGREEMENT.

Journalism
DEPUTY PRESIDENT BINET	PERTH, 16 JUNE 2021

Application for termination of the West Australian Newspapers Clerks (Enterprise Bargaining) Agreement 2004 and the Clerks’ (West Australian) Special Casual Employees Agreement.

[1] West Australian Newspapers Ltd (the West) has made an application (Application) to the Fair Work Commission (FWC), pursuant to Schedule 3 Item 16 of the Fair Work Act 2009 (Cth) (FW Act), to terminate the Clerks’ (West Australian) Special Casual Employees Agreement (AG No. 15 of 1989) (1989 Agreement)and the West Australian Newspapers Clerks (Enterprise Bargaining) Agreement 2004 (Agreement No. 175 of 2004) (2004 Agreement)(collectively the Agreements).

[2] The parties to the 1989 Agreement are the West and employees of the West employed in the following classifications:

a. Classified Booking Clerks

b. Tele-Ad Sales Advisors

c. Classified Re-Keyboarding

d. Classified Complaints

e. Canvassers

[3] The parties to the 2004 Agreement are the West and employees covered by the 1989 Agreement and/or employees engaged in any of the occupations, industries or callings specified in the Clerks (Wholesale and Retail Establishments) Award No.38 of 1947 (Employees).

[4] The Australian Municipal Administrative Clerical and Services Union of Employees, West Australian Clerical and Administrative Branch (ASU) is a party to 2004 Agreement.

[5] The 1989 Agreement past its nominal expiry date on 8 March 1995. The 2004 Agreement past its nominal expiry date on 31 May 2007.

[6] For the purposes of Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (Transitional Act), the Agreements are Collective Agreement-Based Transitional Instruments. By virtue of Item 16 of Schedule 3 of the Transitional Act, the Agreements may be terminated pursuant to section 226 FW Act.

[7] In support of the Application, The West filed a statutory declaration by Ms Marija Muccilli, the Employee Relations Manager of The West (Muccilli Declaration). The Muccilli Declaration asserts that the Agreement is outdated and unsuitable as The West’s clerical staff are covered by the Clerks (Private Sector) Award 2020, and many of the duties undertaken under the Agreements are no longer types of work performed by The West.

[8] On 8 March 2021, directions were issued with respect to the Application (Directions). The West was directed to file an outline of submissions in support of the Application and any evidence on which they relied by 4pm Thursday 18 March 2021. The ASU were directed to file an outline of submissions in response to the Application as well as any evidence on which the ASU sought to rely on, by 4pm Thursday 15 March 2021.

[9] The Directions also required The West to provide a copy of the materials filed by the parties in accordance with the Directions and a copy of the Directions to each of the Employees. The Directions contained an invitation for any of the Employees who wished to be heard in relation to the Application to contact Chambers by 4pm Thursday 8 April 2021. One Employee contacted Chambers by that date.

[10] On 29 April 2021 and 6 May 2021, the ASU and The West respectively confirmed that they did not wish to make oral submissions and that they were content for the Application to be determined ‘on the papers’.

Background

[11] The West is a metropolitan newspaper which has the largest daily circulation in Western Australia.

[12] At the time of the Application, there were 20 employees engaged in The West’s circulation and distribution work area.

Legislation

[13] 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.

[14] 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.”

[15] As the Agreements have passed their nominal expiry date and The West is an employer covered by the Agreements, I find that The West has standing to make the Application pursuant to section 225(a) of the FW Act.

[16] 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 terminate the Agreement?

[17] Section 226(a) requires the FWC to be satisfied that it is not contrary to the public interest to terminate the Agreements.

[18] This requires the FWC to consider how the termination of the Agreements 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 standard. 1

[19] 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.”

[20] 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

[21] 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;

…”

[22] 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.”

[23] 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

[24] The West submits that the termination of the Agreement is not contrary to the public interest. For example, the parties are not currently negotiating therefore the termination of the Agreement would not unfairly prejudice the bargaining positions of the parties. In fact the West submits that the termination of the Agreement is in the public interest because the consequence of the termination of the Agreement is that the Clerks (Private Sector) Award 2020 (Award) will apply to the Employees which will provide employees with various improved terms and conditions of employment including:

a. base rates of pay which are between approximately 20% and 60% greater than those prescribed by the Agreements;
b. payment of loadings and penalty rates that align to the modern system of industrial relations;
c. payment of allowances prescribed in the Award;
d. access to greater workplace flexibility by being able to enter into individual flexibility arrangements;
e. access to the Award’s consultation and dispute resolution provisions;
f. access to casual conversion rights; and
g. access to increases consistent with the Federal Minimum Wage decisions.

[25] The ASU agrees that the termination of the Agreement is not contrary to the public interest.

[26] Based on the submissions of the parties 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?

[27] The West tendered evidence that it has undertaken consultation with Employees including explaining why the West wishes to terminate the agreements and the impact on Employees of such a termination.

[28] A small number of the Employees participated in an informal vote. The majority did not support the termination of both Agreements.

[29] The Directions also required The West to provide a copy of the materials filed by the parties in accordance with the Directions and a copy of the Directions to each of the Employees. The Directions contained an invitation for any of the Employees who wished to be heard in relation to the Application to contact Chambers by 1 April 2021. Only one employee contacted Chambers.

[30] On 7 April 2021, Chambers received a submission from one Employee covered by the Agreement. The employee submitted that terminating the Agreements would result in a significant reduction in redundancy pay-outs and potentially increase the likelihood of redundancies.

What are the views of the Employee Organisation covered by the Agreement?

[31] Given that the termination of the Agreements would not be contrary to the public interest, that the termination of the Agreements would bring covered employees comprehensively under the coverage of the Award and the NES, and the ASU’s ability to represent the industrial interests of its members and covered employees capable of being ASU members would not be prejudiced the ASU supports the Application.

What are the views of the Employer covered by the Agreement?

[32] The West supports the termination of the Agreement for the following reasons:

a. It allows the Modern Award and NES to apply to employees;
b. It ensures that a simple, fair and flexible system of workplace relations is in place within its operations as opposed to present patchwork analysis which is in place in respect of clerical staff; and
c. It removes outdated redundancy provisions which constrain the Applicant’s managerial prerogative and which presently result in inefficiencies and restrictions on the way the West manages its business in respect of its clerical functions.

What are the circumstances of the Employees covered by the Agreement?

[33] The West submits that the termination of the Agreements is likely to have the following effect on employees covered by the Agreements:

a. Whilst the Employees will lose the contingent entitlement of more generous redundancy terms under the Agreements when compared to the Award and the NES the Employees will obtain the benefit of improved terms and conditions of employment under the Award;
b. The termination of the Agreements will enhance the prospect of longer term sustainable employment for the majority of the Employees; and
c. The Employees will not be prevented from negotiating above Award conditions via a new enterprise agreement should they wish to do so.

The ASU notes that the Agreement provides for uncapped severance pay in contrast to the Award which is capped. The ASU submits that this may marginally increase the likelihood of Employees being terminated. The ASU accepts that, despite some reductions of entitlements occurring through the termination of the Agreements, employees covered by the Agreements would be better off overall when covered comprehensively by the Award and the NES.

What are the circumstances of the Employee Organisation covered by the Agreement?

[34] The ASU submits that the termination of the Agreements would not prejudice the ASU’s ability to represent the industrial interests of employees covered by the Agreements and which are members of the ASU or are capable of being members of the ASU. Specifically, termination may lead to both a clearer identification of the rights, obligations, and entitlements of employees covered by the Agreements and the legal validity and operation of those rights, obligations, and entitlements. The ASU say that such a clearer view will assist the ASU in its representation of members’ industrial interests.

[35] The ASU also submit that the application of the dispute resolution procedure at cl 40 of the Award will clarify for the ASU the rights of its members in disputing and vindicating their rights, obligations, and entitlements. Similarly, the ASU submit that the application of cl 38 and cl 39 of the Award would also clarify for the ASU the application of the Award’s consultation procedures and the ASU’s right of representation through such consultation.

[36] The ASU also submit that the termination of the Agreements would not impair the ability of the ASU to bargain in ‘good faith’ with the Applicant for a future enterprise bargaining agreement.

What are the circumstances of the Employer covered by the Agreement?

[37] The West submit that the effect of termination is likely to have on the West is as follows:

a. It will remove constraints, restrictions and inefficiencies imposed on the business as a result of maintaining outdated industrial instruments and will allow the business to modernise its industrial instrument;
b. It will enable the West to more readily and reasonably reorganise its business so as to improve efficiency and remove unnecessary operating costs;
c. It will relieve the West of being forced or required to employ more employees than are reasonably needed;
d. It will enable the West to provide longer term sustainable employment for the majority of its employees; and
e. The West will be free to negotiate new enterprise agreements under the auspices of the FW Act using a modern instrument as a negotiating base as opposed to the outdated Agreements which are presently underpinned by a sunset NAPSA.

Is it appropriate to terminate the Agreement taking into all the circumstances?

[38] In assessing the views and circumstances of the parties it is important to remember that: 4

“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.”

[39] The parties have provided the reasons for their views and I am satisfied that their views are valid. The Agreements came into effect in 2004 and 1990 respectively. The nominal expiry dates of 2007 and 1995 have now past. Termination will have the effect of removing outdated terms and conditions and allow the Award to apply to employees presently within scope of the Agreements. Termination will also allow the removal of legacy, state-based instruments, from the modern industrial framework. Termination will not shift the dynamic of bargaining as the parties are not presently bargaining and will not prevent the making of an enterprise agreement in the future should the parties so desire.

[40] Existing employees will lose the opportunity for potentially higher severance payments however this is a contingent entitlement only which must be balanced against an overall improvement in day to day terms and conditions. The West could address these concerns by ‘grandfathering’ existing severance entitlements for long serving employees in recognition of the reliance they may have placed on potential access to these entitlements when they made decisions in the past as to whether or not to continue their serve with the West.

Conclusion

[41] For the reasons enunciated above, I am satisfied that it is not contrary to the public interest to terminate the Agreement.

[42] Taking into account all the circumstances, including the views and circumstances of The West, its Employees and the ASU, I am satisfied that it is appropriate to terminate the Agreement.

[43] Accordingly, the Agreementis terminated. The termination is to take effect on and from midnight on 30 June 2021. An Order to this effect will be issued in conjunction with this Decision. 5

DEPUTY PRESIDENT

 1   Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000 (2005) 139 IR 34 at 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 Miscellanous Union[2010] FWA 2434 at [16].

 5   Print PR730782.

Printed by authority of the Commonwealth Government Printer

< PR730097>