Expired AWAs continued against employer’s wishes

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Expired AWAs continued against employer’s wishes

The AIRC has ruled that a call centre’s attempts to terminate expired Australian Workplace Agreements (AWAs), and put three employees under a collective agreement, were against public interest.

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The AIRC has ruled that a call centre’s attempts to terminate expired Australian Workplace Agreements (AWAs), and put three employees under a collective agreement, were against public interest.
 
Justice Munro stated that public interest involved considerations of sanctity of contract, good conscience and industrial merits. 
 
Background
 
The three AWAs bound the successor employer in a call centre business. However, the AWAs had expired and the employer sought to bring the three employees under a collective agreement that applied to the rest of the workforce.
 
The question for the AIRC was whether termination would not be contrary to the public interest.
 
The notion of public interest involved considerations of sanctity of contract, good conscience and industrial merits.
 
Consideration
 
The 'sanctity of contract' notion was considered an elusive concept in practical application. However, in the view of Justice Munro, for the purpose of founding a public interest concern with termination of an AWA (an instrument binding the employee as an individual), the concept has a tangible focus.
 
In operation, an AWA supplants awards, collective agreements and some regulatory protections. The displacement of an AWA without the consent of both parties could have a substantial impact upon one or other party to the AWA.
 
The AIRC was satisfied that there was industrial merit in the case put by the respondent employee party to each of the applications. Each accepted an AWA in circumstances associated with major organisational change. That consideration justified a finding that the AWA was intended to provide both the employer and the relevant employee with a measure of security and certainty about conditions of employment and continuance of services.
 
The AWA was negotiated and approved during a time of relatively turbulent organisational change. The AWA was entered into in each instance with an experienced employee whose work was highly valued. The AWA became an element in the package of benefits applied on successive transmissions of business.
 
Justice Munro drew the inference, available on the evidence, that the retention in employment of each of the individual employees was of some value in achieving a degree of continuity in service and client orientation over the course of those transmissions.
 
Findings
 
The employer had not been able to satisfy the Commission that the termination of the AWAs would result in a just or fair outcome for any of the three employees. 
 
The Commission accepted the evidence that the disclosed intention would place the employees at pay levels that involve a disadvantage relative to less experienced employees who have not come to the current employer through the same path.
 
Moreover, the disclosed conduct of the employer showed a relative failure on the employer's part to genuinely try to reach agreement with each of the employees about either a replacement agreement or an acceptable alternative to simple termination of their existing rights and entitlements under their AWA.
 
Justice Munro commented:
‘The first step was a purportedly unilateral termination of the relevant AWA, ostensibly based on unsound advice sourced to unnamed officers of the Office of Employment Advocate.
 
'So far as I am aware, no progress has been made in producing a compromise acceptable to each respective employee. In the circumstances, I am satisfied that the public interest would be ill-served if I were to give my approval to the applicant employer repudiating each AWA before an acceptable and reasonable substitute set of conditions for each employee is put in place.’
The Commission dismissed each application.
 
See: AWA between N -and- RR and Others. – AIRC (Munro J) - PR928863 - (18 March 2003).
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