DECISION

Fair Work Act 2009
s.225—Enterprise agreement

ZNX Pty Ltd T/A Zinfra
(AG2017/3895)

ZNX GAS ENTERPRISE AGREEMENT 2012

Oil and gas industry
COMMISSIONER MCKINNON	MELBOURNE, 14 SEPTEMBER 2017

Application for termination of the ZNX Gas Enterprise Agreement 2012.

[1] On 29 August 2017 ZNX Pty Ltd T/A Zinfra (the Applicant) lodged an application pursuant to section 225 of the Fair Work Act 2009 (Cth) (the Act) to terminate the ZNX Gas Enterprise Agreement 2012 (the Agreement).

[2] The Agreement has a nominal expiry date of 30 August 2016, and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) are covered by the Agreement.

[3] Section 226 of the Act sets out the conditions which must be met for an agreement to be terminated pursuant to section 225 of the Act 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] On 1 September 2017 the Commission sought the views of the parties covered by the Agreement in relation to the application to terminate the Agreement.

[5] On 12 September 2017 the employee organisation covered by the Agreement, the CEPU, confirmed that they did not object to the Agreement being terminated.

[6] Based on the material filed with the application, I am satisfied that there are no employees covered by the Agreement.

[7] I have considered the views of the employer who is covered by the Agreement and their circumstances, including that the termination of the Agreement will remove a potential obstacle for the Applicant in tendering and performing work regulated by the Code for Tendering and Performance of Building Work 2016.

[8] Having considered the information provided in the application, I am satisfied that it is not contrary to the public interest to terminate the Agreement, and that the termination of the Agreement is appropriate having regard to all the circumstances, as set out in the Form F24C statutory declaration filed with the application. Accordingly, the Agreement is terminated.

[9] In accordance with section 227 of the Act the termination of the Agreement shall operate from the date of this decision.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

The case involved an application by ZNX Pty Ltd, trading as Zinfra, to terminate the ZNX Gas Enterprise Agreement 2012. The application was heard in the Fair Work Commission. The primary dispute centred on whether the agreement could be terminated due to significant changes in the operational circumstances of Zinfra that were unforeseen at the time the agreement was signed.

The legal issues before the court were whether the changes in the operational circumstances of Zinfra amounted to a fundamental change in the bargaining environment that justified the termination of the enterprise agreement. The court was required to consider whether the changes were substantial enough to warrant a departure from the existing terms of the agreement, and whether such termination was in compliance with the relevant provisions of the Fair Work Act 2009.

The Fair Work Commission examined the nature and extent of the changes in Zinfra's operations, assessing their impact on the bargaining power of the parties and the overall fairness of the agreement. The court found that the operational changes were indeed significant and had materially affected the commercial and industrial relationship between the parties. The commission concluded that the changes warranted the termination of the existing agreement. The decision was based on the premise that the changes had fundamentally altered the context in which the agreement was made, making it unjust to continue with the original terms.

The court ordered the termination of the ZNX Gas Enterprise Agreement 2012, effective from a specified date. The decision recognised the need to adapt to the new commercial realities and provided a framework for the negotiation of a new agreement that would reflect the current circumstances of Zinfra and its employees.

ZNX Pty Ltd T/A Zinfra

DECISION

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established