Enterprise bargaining – streams

The Secure Jobs, Better Pay legislation amends and expands the existing streams of enterprise bargaining. Across the multi-employer streams, civil and commercial construction industries have been excluded. For ease, we have produced an explainer table below:

The cumulative effect of these changes shifts the focus of enterprise bargaining towards the industry level and away from bargaining at the enterprise level.

Single interest employers bargaining authorisations and agreements

Single interest employer bargaining authorisations will expand the stream of bargaining for an enterprise agreement between employers with common interests.

The Fair Work Commission (Commission) may make a single interest agreement covering employers with or without their consent, where their operations and business activities are reasonably comparable. This form of enterprise bargaining will be available where:

• the employer(s) agree to bargain or a majority of employees who are employed by the employer(s) and who will be covered want to bargain;
• the employers have clearly identifiable common interests (such as geographical location, being regulated by a common regulatory regime, terms and conditions of employment, and the nature of the enterprises);
• the group of employees to be covered was fairly chosen (having regard to whether the group is geographically, operationally or organisationally distinct);
• at least some of the employees who will be covered are represented by an employee organisation;
• the employers and bargaining representatives of employees have had an opportunity to express their views to the Commission; and
• it is not contrary to public interest for the authorisation to be granted.

Employers cannot be compelled to bargain for a single interest employer agreement if a single enterprise agreement is in operation or an employer has already agreed to bargain with its employees for a single enterprise agreement.

A small business (fewer than 20 employees) can only participate in this stream by consent. Conversely, employers with 50 employees or more who do not wish to bargain in this stream will bear the onus of establishing their operations and business activities are not reasonably comparable where an application for a single interest bargaining authorisation is made.

Subject to meeting specific criteria, the coverage of single interest employer agreements may be varied to include additional employers or remove existing employers.

Protected industrial action remains available.

Supported bargaining agreements

The existing low-paid bargaining stream, which was intended to encourage low-paid employees and their employers to negotiate a purpose-fit enterprise agreement, will be renamed the supported bargaining stream. The amendments aim to simplify enterprise bargaining and provide additional support via the Commission for employees in low-paid industries (such as aged care, disability care and early childhood education).

Following an application to the Commission for a “supported bargaining authorisation”, the Commission will be required to consider if it is appropriate for the relevant parties to bargain collectively, having regard to:

• sector pay and conditions;
• whether common interests of employers exist that are clearly identifiable; and
• whether the number of bargaining representatives is manageable.

Bargaining disputes may be dealt with by the Commission on application by a single bargaining representative, or the Commission may provide support to bargaining representatives at its own instigation. The Commission may make a workplace determination if agreement between the parties cannot be achieved.

Once a supported bargaining agreement is made, and following application to and approval by the Commission, the agreement may be varied to cover additional employers and their employees.

Cooperative workplace agreements

The existing multi-enterprise agreement stream is replaced with the cooperative workplace agreements stream. Participation is voluntary and protected industrial action is not available.

Employers can join with other employers to bargain for a cooperative workplace agreement, however at least some employees must be represented by a registered employee association (union).

The Commission can assist parties to negotiate agreements, exclude parties (in certain circumstances) and vary an existing cooperative workplace agreement to add employees and employers, where appropriate (this can only be achieved by the joint application of relevant employers and employees).

Other important considerations

These include:

• Employers negotiating as part of a multi-enterprise agreement must obtain written agreement from each union acting as a bargaining representative for the agreement to be put to an employee vote for approval or variation.
• The government agreed to exclude “general building and construction work” from coverage by a multi-enterprise agreement. This includes work in the civil construction sector, however, does not include work in the asphalt industry.

Bolstered bargaining dispute powers

The Commission also has increased power to assist in resolving bargaining disputes, including:

• Transforming the current serious breach declaration scheme, which will be replaced by “intractable bargaining declarations”. Under the new scheme, where negotiations have broken down, an application for the Commission’s assistance has been made, and the Commission is satisfied there is no reasonable prospect of agreement being reached (such that the situation is deemed “intractable”), the Commission will have the power to issue an “intractable bargaining declaration”. This will then allow the Commission to go on to reach a decision as to the terms which should be included in the relevant enterprise agreement.
• However, the Commission’s power to intervene in an “intractable bargaining” situation will only arise following a minimum bargaining period which is the later of 9 months after the nominal expiry date of any existing agreement, or the day that is 9 months after the day bargaining starts. This minimum period must have passed before an intractable bargaining declaration can be issued.
• There will be a reduced requirement for all parties to consent to Commission intervention in a bargaining dispute.

What should employers do?

• Employers should assess whether their industries of operation are likely to be affected by the legislative changes. This is particularly important for employers operating in low paid industries, or those susceptible to common interest or multi-employer bargaining.
• Employers with enterprise agreements that have passed their nominal expiry date or will pass the nominal expiry date before 6 June 2023, should consider whether it is appropriate to commence bargaining for a single enterprise agreement.
• Otherwise, employers should calibrate their bargaining approach to the fact that the Fair Work Commission will have broadened powers in intervene in intractable disputes.

Further information / assistance regarding the issues raised in this article is available from the author, Nick Duggal, Partner, Estelle Sarra, Associate, Alex Peck, Paralegal or your usual workplace contact at Moray & Agnew.