Variation of ongoing agreement permitted

Cases

Variation of ongoing agreement permitted

In a technical ruling on the operation of enterprise agreements, a Full Federal Court has ruled a provision blocking variation to an agreement was invalid.

WantToReadMore

Get unlimited access to all of our content.

In a technical ruling on the operation of enterprise agreements, a Full Federal Court has ruled that a provision blocking variation to an agreement was invalid.

[Full text of this case: Toyota Motor Corporation Australia Limited v Marmara [2014] FCAFC 84 (18 July 2014)]

The background to this case was outlined at: Varying enterprise agreements during their life

Clause blocked variation of the agreement 


The Full Court stated that  the question which arose was essentially one of the rule of law. It had to make a technical ruling on whether a clause that blocked variation to an agreement in the course of the agreement was able to stand if challenged.  

Parliament’s intention was that an enterprise agreement may be varied and an employer may put such a request to its employees. Therefore a term in an enterprise agreement which stated, or had the effect, that the employer may not proceed with such a request must necessarily be inconsistent with, or repugnant to, the Fair Work Act.

The court noted Justice Bromberg's ruling at first instance had generated a good deal of debate about whether the Fair Work Act and the agreement could, or should, have operated to prevent an employer and the majority of its employees from giving effect to a consensus between them to vary the agreement. The debate occurred in the context of the employer, Toyota, announcing its decision to cease car manufacturing in Australia.

The Full Court praised Justice Bromberg’s expedited efforts to assist in settling the points of disputation among the parties. It concluded that the union delegates' action to stop Toyota varying the agreement should have been dismissed.

The bottom line: Technical rules relating to enterprise agreements – underpinned by legislation – can sometimes frustrate the attempts by parties to settle industrial disputation.

Toyota Motor Corporation Australia Limited v Marmara [2014] FCAFC 84 (18 July 2014)

 

Post details