The Award system in Australia introduces minimum standards of employment to protect employees. It creates a safety net when it comes to pay rates and certain employment conditions, including leave entitlements. However, the Fair Work Act 2009 (Cth) introduced the ability of employers and employees to agree to different terms and conditions of employment through the Enterprise Bargaining Agreement (EBA). The EBA can be beneficial for employees in many ways.

Replacement of the Award

The implementation of an EBA in a workplace can lead to the replacement of an Award. Some EBAs may still include some terms and conditions that can be found in the Award. Although this may mean that certain minimum standards may be eroded, the EBA needs to ensure that you as an employee are “better off overall”. If this threshold is not met, the Fair Work Commission cannot approve an EBA.

Procedural Bargaining Protection

For an EBA to be approved, the employer and employee need to ensure that the procedural requirements of the bargaining process are met. For an employee, there are various rules in place that are created to ensure you are protected. This may include the need for the employer to comply with the relevant notice periods or the need to explain the agreement and its actual effects on your employment. The employer also has an obligation to bargain in good faith. This may include full disclosure of relevant information and making genuine considerations of the proposals that have been provided by your bargaining representative.

Outcomes of Enterprise Bargaining

Although the process of reaching an agreement with your employer may end up in lengthy negotiations, the result of enterprise bargaining can lead to benefits to the employee that may not always have been foreseeable. These may include, for example, flexibility when it comes to hours of work or rosters, the introduction of family-friendly terms and conditions or increased opportunities for training and development. Once again, this comes down to the “better off overall” test. Employers need to ensure that employees are in a favourable position once the EBA is approved.

Necessary Terms

The Fair Work Act 2009 (Cth) requires that certain terms and conditions be included in an EBA. Some necessary terms include the requirement of a dispute settlement procedure or the need for employers to consult employees when significant changes arise. An employee also needs to be provided with an opportunity to negotiate an individual agreement directly with their employer. Further, the EBA cannot have unlawful content included in the agreement. For example, unfair dismissal provisions cannot be excluded or modified in a way that is detrimental to the employee.

Conclusion

The Enterprise Bargaining Agreement procedure has safeguards incorporated into the process that are created to protect employees and ensure their interests are considered. If you are an employee in an enterprise that is considering the implementation of an Enterprise Bargaining Agreement, contact one of our specialist employment lawyers to discuss whether the terms and conditions that are being negotiated will leave you “better off overall”.

Kristine Biason

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