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

Boluda Towage (Australia) Pty Ltd (previously Smit Lamnalco Towage (Australia) Pty Ltd)

SMIT LAMNALCO AUSTRALIA MARITIME OFFSHORE OIL AND GAS INDUSTRY ENTERPRISE AGREEMENT 2016

Application for termination of the Smit Lamnalco Australia Maritime Offshore Oil and Gas Industry Enterprise Agreement 2016

[1] Boluda Towage (Australia) Pty Ltd (formerly Smit Lamnalco Towage (Australia) Pty Ltd) (applicant) has applied under s.225 of the Fair Work Act 2009 (Act) to terminate the Smit Lamnalco Australia Maritime Offshore Oil and Gas Industry Enterprise Agreement 2016 (AG2016/3337) (2016 Agreement).

[2] Clause 4 of the 2016 Agreement provides that the 2016 Agreement covers the following:

(b) the Employees employed by the Employer to work in the Maritime Offshore Oil and Gas Industry:

(i) in any of the classifications contained in the Schedules to this Agreement, whether or not they are at a particular point in time performing duties on rostered work time on a vessel; or

(ii) in any Employer approved leave, pre-mobilisation or on-shore duties that the Employer requires the Employee to undertake before or after commencing work in any of the said classifications.

[3] The 'Maritime Offshore Oil and Gas Industry is defined at clause 3.1 to mean 'the operation, utilisation, control, maintenance, repair and service of Vessels in or in connection with offshore oil and gas operations.'

[4] There are no employee organisations covered by the 2016 Agreement. The nominal expiry date of the 2016 Agreement is 4 August 2020.

[5] In the circumstances, I have decided to deal with the application on the papers without conducting a hearing.

225 Application for termination of an enterprise agreement after its nominal expiry date

(1) 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.

[7] Section 226 of the Act provides:

226 Terminating an enterprise agreement after its nominal expiry date

(1) 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 the continued operation of the agreement would be unfair for the employees covered by the agreement; or

• (b) the FWC is satisfied that the agreement does not, and is not likely to, cover any employees; or

• (c) all of the following apply:

  • (i) the FWC is satisfied that the continued operation of the enterprise agreement would pose a significant threat to the viability of a business carried on by the employer, or employers, covered by the agreement;

  • (ii) the FWC is satisfied that the termination of the enterprise agreement would be likely to reduce the potential of terminations of employment covered by subsection (2) for the employees covered by the agreement;

  • (iii) if the agreement contains terms providing entitlements relating to the termination of employees' employment - each employer covered by the agreement has given the FWC a guarantee of termination entitlements in relation to the termination of the agreement.

(1A) However, the FWC must terminate the enterprise agreement under subsection (1) only if the FWC is satisfied that it is appropriate in all the circumstances to do so.

(2) This subsection covers a termination of the employment of an employee:

• (a) at the employer's initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

• (b) because of the insolvency or bankruptcy of the employer.

(3) In deciding whether to terminate the agreement, the FWC must consider the views of the following covered by the agreement:

• (a) the employees (unless there are no employees covered by the agreement);

• (b) each employer;

• (c) each employee organisation (if any).

Note: The President may be required to direct a Full Bench to perform a function or exercise a power in relation to the matter if any of the employers, employees, or employee organisations, covered by the agreement oppose the termination (see subsection 615A(3)).

(4) In deciding whether to terminate the agreement (the existing agreement), the FWC must have regard to:

• (a) whether the application was made at or after the notification time for a proposed enterprise agreement that will cover the same, or substantially the same, group of employees as the existing agreement; and

• (b) whether bargaining for the proposed enterprise agreement is occurring; and

• (c) whether the termination of the existing agreement would adversely affect the bargaining position of the employees that will be covered by the proposed enterprise agreement.

(5) In deciding whether to terminate the agreement, the FWC may also have regard to any other relevant matter.

[8] The 2015 Agreement has passed its nominal expiry date and the applicant has standing to make the application pursuant to s.225(a) of the Act because it is the employer that is covered by the 2015 Agreement. Accordingly, the jurisdictional prerequisites for the making of an application under s.225 of the Act are satisfied.

[9] The applicant filed a declaration by its authorised representative, Mr. Jared Laughlin, in support of the application. The declaration attested to the fact that the operating environment for the applicant has changed and it has not conducted any operations in the Maritime Offshore Oil and Gas Industry in the more than five (5) years that Mr. Laughlin have been employed with the applicant. Mr. Laughlin said that the applicant does not have any intention of conducting any operations which would be subject to the 2016 Agreement, nor does it have any contracts in place that would allow it to conduct the work.

[10] On the material filed with the Commission I am satisfied the 2016 Agreement does not and is not likely to cover any employees and that the requirement of s.226(1)(b) is met. I have taken into account the views of the applicant and note that there are no employees or employee organisations covered by the 2016 Agreement. I have also considered the matters referred to in s.226(4) and note the evidence of Mr. Laughlin that no process for the making of a new agreement has commenced. There are no other relevant matters that I should take into account in the determination of this matter of which I am aware. I am satisfied that it is appropriate in all the circumstances to terminate the 2016 Agreement.

[11] Given my findings in respect of ss. 225 and 226 of the Act, I am required to terminate the 2016 Agreement. The termination will operate from 24 March 2026.

Printed by authority of the Commonwealth Government Printer