Application for termination of the Manly Stephens Enterprise Agreement 2013

[1] Edluchan Pty Limited, Little Bay Manly and Manly Stephens Pty Ltd (In Partnership) (Applicant) has made an application to the Fair Work Commission to terminate the Manly Stephens Enterprise Agreement 2013 (Agreement) pursuant to s.225 of the Fair Work Act 2009 (FW Act) (Application).

[2] The Agreement covers the Applicant and its employees who are employed as crew members at the Applicant's franchisee operated Guzman y Gomez Restaurants in the Manly and the Northern Beaches region of Sydney. There are currently 158 employees covered by the Agreement. The nominal expiry date of the Agreement is 13 September 2017.

[3] Subdivision D of Division 7 of Part 2-4 of the FW Act applies in relation to the termination of an enterprise agreement after its nominal expiry date and relevantly 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;

(c) an employee organisation covered by the agreement.

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

(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);

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.

If an enterprise agreement is terminated under section 226, the termination operates from the day specified in the decision to terminate the agreement.

[4] The Applicant was directed to provide a copy of the Application, along with a copy of the supporting declaration, to each employee and any employee organisation covered by the Agreement. The parties covered by the Agreement were given an opportunity to advise my Chambers if they opposed the Application.

[5] There is no opposition to the Application by an employee, employer or an employee organisation. Accordingly, s.615A(3) of the FW Act is not engaged and I can determine the Application in my capacity as a single member of the Commission.

[6] The Applicant submits that the continued operation of the Agreement would be unfair for the employees covered by it as the terms and conditions of the Agreement are inferior to the terms of the Fast Food Industry Award 2020 (FFI Award). I agree and observe that the penalty rates and overtime rates under the FFI Award are significantly more favourable than those under the Agreement. The FFI Award is also more favourable in relation to split shift rostering arrangements and accident pay.

[7] Having regard to all of the circumstances, I am satisfied that the termination of the Agreement is appropriate. In coming to this this decision, I have taken into account the views expressed by the Applicant in support of the Application. The employees covered by the Agreement have not expressed any views. There are no employee organisations covered by the Agreement (s.226(3)).

[8] I am satisfied that the Application has not been made 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; that no bargaining for such a proposed enterprise agreement is occurring; and that no employees covered by the Agreement would have their bargaining position for any proposed enterprise agreement adversely effected by the termination of the Agreement (s.226(4)). I am also satisfied that there are no other relevant matters to be considered (s.226(5)).

[9] To assist with the transition from the Agreement to the FFI Award, and to align with the commencement of its next pay period which commences on 1 December 2025, the Applicant submitted that the termination of the Agreement operate from 30 November 2025. Having regard to s.36 of the Acts Interpretation Act 1901 and s.227 of the FW Act, the termination of the Agreement operates from 30 November 2025.

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