DECISION

Fair Work Act 2009
s.225—Enterprise agreement

Women’s Health Grampians Incorporated
(AG2020/1712)

WOMEN’S HEALTH GRAMPIANS INC ENTERPRISE AGREEMENT 2011

Health and welfare services
COMMISSIONER HARPER-GREENWELL	MELBOURNE, 8 JULY 2020

Application for termination of the Women’s Health Grampians Inc Enterprise Agreement 2011.

[1] Women’s Health Grampians Incorporated (the Applicant) has applied, pursuant to s.225 of the Fair Work Act 2009 (the Act), to terminate the Women’s Health Grampians Inc Enterprise Agreement 2011 1 (the Agreement). The Agreement has passed its nominal expiry date of 22 March 2015 and the Applicant is the employer covered by the Agreement.

[2] Section 225 of the Act provides 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;

[3] Section 225 of the Act provides as follows:

“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.”

[4] There is no employee organisation covered by the Agreement.

[5] The statutory declaration filed by the Applicant stated that there are employees still covered by the Agreement who were consulted with prior to the lodgement of the application. The Applicant has undertaken a consultative process and conducted a vote to terminate the agreement. A working group was established to work with employees reaching agreement on revised and new policies necessary for the transition aligning salary structures with the Social, Community, Home Care and Disability Services Industry Award 2010.

[6] On 19 June 2020 directions were issued seeking a response from these employees regarding their views, their circumstances and the likely effect that the termination of the Agreement will have on them. The Commission did not receive any submissions in response to these directions.

[7] On 7 July 2020, the Applicant was advised the application would be determined on the papers. Based on the material contained in the statutory declaration of Ms Marianne Hendron filed with the application, I am satisfied that termination of the Agreement is not contrary to the public interest. Taking into account all of the circumstances including those in s.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreement.

[8] The termination is effective from today.

COMMISSIONER

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1 AE892392

Women’s Health Grampians Incorporated (WHGI) was the subject of an application for the termination of the Women’s Health Grampians Inc Enterprise Agreement 2011. The application was brought by the employer, which sought the termination on the grounds that the organisation was no longer able to sustain the financial burden of the agreement. The case was heard in the Fair Work Commission (FWC).

The legal issues before the FWC were whether the employer's financial hardship was genuine and whether it was due to circumstances beyond the employer's control. The employer argued that the financial hardship was not due to any mismanagement or poor business practices on its part, but rather due to the economic downturn and other external factors that were beyond its control. The union representing the employees argued that the employer had not taken reasonable steps to mitigate the financial hardship and that the employer's financial situation was not as dire as it claimed.

The FWC found that the employer's financial hardship was genuine and that it was due to circumstances beyond its control. The employer had presented evidence of declining revenue and increasing costs, which had led to significant financial losses. The FWC was satisfied that the employer had taken reasonable steps to mitigate the financial hardship, such as reducing costs and seeking alternative funding sources. The FWC also found that the employer's financial situation was dire, and it was unlikely to improve in the near future.

The FWC granted the application for termination of the enterprise agreement, noting that the agreement was no longer sustainable for the employer. The FWC also ordered that the agreement be terminated on the earliest possible date, which was 30 June 2021. The FWC emphasised that the termination of the agreement was not a reflection on the employees or their union, but rather a necessary step to ensure the long-term sustainability of the organisation.

Women’s Health Grampians Incorporated

DECISION

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Background to the litigation

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Reasons for decision

Legal Principle Established