Wormald Australia Pty Ltd T/A Wormald

[2019] FWCA 8517

[2019] FWCA 8517

FAIR WORK COMMISSION

DECISION

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

Wormald Australia Pty Ltd T/A Wormald
(AG2019/3729; AG2019/3733)

WORMALD TOWNSVILLE FIRE ALARM ENTERPRISE AGREEMENT 2013-2016

WORMALD TOWNSVILLE PORTABLES 2010 – 2013 ENTERPRISE AGREEMENT

Electrical contracting industry
COMMISSIONER HUNT	BRISBANE, 18 DECEMBER 2019

Application for termination of the Wormald Townsville Fire Alarms Enterprise Agreement 2013-2016 – Application for termination of the Wormald Townsville Portables 2010 – 2013 Enterprise Agreement.

[1] On 1 October 2019, Wormald Australia Pty Ltd T/A Wormald (the Employer) made two applications pursuant to s.225 of the Fair Work Act 2009 (the Act) to terminate the Wormald Townsville Fire Alarms Enterprise Agreement 2013-2016 (the Fire Alarms Agreement) and the Wormald Townsville Portables 2010 – 2013 Enterprise Agreement (the Portables Agreement; jointly ‘the Agreements’). The Agreements have passed their nominal expiry dates.

[2] The original applications to approve each of the Agreements were made by ‘Tyco Australia T/A Wormald’, and each of the Agreements’ coverage clause state that the Agreement covers, “Wormald (a division of Tyco Australia Pty Ltd.)”

[3] I dealt with each of the applications in this matter jointly, and it is appropriate to determine both of the applications before me in these matters in this decision.

[4] The applications were supported by statutory declarations from Mr Phillip Darby, National Industrial Relations Manager of the Employer which declared, amongst other things, that none of the Employer’s employees worked under the Agreements.

[5] Upon allocation of these matters to me, I asked the Employer to provide further information as to how it said that there were no employees covered by the Agreements. Further, I asked the Employer to provide information about its corporate structure, when the relevant employees were last covered by the Agreements and whether any of its employees were currently employed in Townsville, QLD?
[6] Mr Darby wrote to my chambers and provided a document setting out the corporate structure for the Employer. He stated that the Employer did have employees in its Townsville office, but those employees were not employed under the Agreements. Rather, the terms and conditions of those employees were set out in individual employment contracts which Mr Darby stated exceeded the terms and conditions provided by the Agreements.

[7] Following Mr Darby’s correspondence, I asked the Employer to provide further information about the employment of employees in Townsville, which entity within the Employer’s corporate structure actually employs the employees, and how the Employer says that the Agreements are not transferable instruments and how there was not a transfer of business from the Employer to the current employing entity.

[8] Mr Darby wrote to my chambers and confirmed that the employees employed within the Townsville office were employed by the Employer. Mr Darby stated that the Employer had previously been purchased by an entity based in the USA, ‘Tyco’ and agreed that the Agreements would be transferable instruments if there were any employees employed under them. Mr Darby maintained that the last employee employed under the Agreements had ceased employment with the Employer in May 2017.

[9] I considered it appropriate to list this matter for conference before me to discuss the information provided by the Employer in greater detail. I conducted a conference of this matter on 1 November 2019. Mr Darby appeared for the Employer at the conference.

[10] During the conference Mr Darby confirmed that ‘Tyco’ had purchased the Employer, and the Employer’s operations had been carried out by an entity known as ‘Tyco Australia Pty Ltd’ (Tyco Australia) for a time, which is the entity referred to in the coverage clauses of the Agreements. I discussed with Mr Darby the possibility of a transfer of business from Tyco Australia to the Employer, and noted that if a transfer of business had occurred then any employees that had been employed at the time of the transfer of business may still be covered by the Agreements, regardless of any common law contracts that may have been entered into. I directed the Employer to confirm its position as to whether a transfer of business may have occurred.

[11] Following the conference, Mr Darby wrote to my chambers and provided several company extract documents. Those documents confirmed that on 2 February 2016, Tyco Australia changed its name to Wormald Australia Pty Ltd. Mr Darby submitted that since Tyco Australia and the Employer were in fact the same entity, there had been no transfer of business. Mr Darby maintained that the Employer did not engage any employees under the Agreements.

[12] I wrote to the Employer and noted its views that there had been no transfer of business as Tyco Australia and the Employer are in fact the same entity. However, I remained concerned about the Employer’s assertions that no employees are engaged under the Agreements and noted that no common law contracts can displace the application of the Agreements to an employee covered by the Agreements.

[13] I directed the Employer to provide further information about how it said the Agreements did not apply to its Townsville employees, whether the terms and conditions provided by the Agreements had been paid to each relevant employee during their employment, and to provide contact email addresses for its Townsville employees so that I may invite those employees to provide their views on the termination of the Agreements to my chambers directly.

[14] Mr Darby provide copies of the common law employment contracts entered into by each of the four employees in its Townsville office. Mr Darby stated that the wages and allowances paid to each of the four employees under their common law contracts exceeded the entitlements under the Agreements. In later correspondence Mr Darby provided the email addresses for each of the Townsville employees.

[15] I wrote to each of the employees individually through my chambers regarding the Employer’s applications to terminate the Agreements. I provided the employees with copies of each of the Agreements and informed them that it was likely they were covered by either the Fire Alarms Agreement or the Portables Agreement, despite their common law contracts of employment. I invited each of the employees to provide their views on the termination of the Agreements to my chambers, copying in Mr Darby.

[16] I did not receive correspondence from any of the Employer’s Townsville employees providing their views on the termination of the Agreements.

[17] Section 226 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to s.225 of the Act. Section 226 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.”

Consideration

[18] Based on the material contained in the statutory declaration filed with the application, in consideration of s.226(a), I am satisfied that the termination of the Fire Alarms Agreement and the Portables 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.

[19] I consider that the Employer’s employees in its Townsville office are covered by either the Fire Alarms Agreement or the Portables Agreement. However, none of those employees provided any views on the termination of either of the Agreements. I note the Employer’s submissions that each of the relevant employees receive a higher rate of pay and greater allowances then they would under either of the Agreements.

[20] In consideration of the material before me relevant to s.226(b)(i) and (ii), I consider that it is appropriate to terminate the Agreements.

[21] In accordance with s.226, I must terminate the Agreements. The applications to terminate the Fire Alarm Agreement and the Portables Agreement are approved.

[22] The terminations will take effect from today, 18 December 2019.

COMMISSIONER

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