Negotiating enterprise agreements

The Fair Work Act requires employers to collectively bargain with employees where a majority of employees want this, and to do so in “good faith”.

When a bargaining process commences (which can happen at any time) an employer is required, within 14 days, to provide each employee with a notice of the right to be represented by a bargaining representative. This may be anyone (including a union, provided they are entitled to represent the employee in that particular role). Employers cannot refuse or deny to recognise a valid bargaining representative.

If an employer isn’t prepared to bargain, a bargaining representative can apply to Fair Work Australia for a determination that a majority of “employees” wish to bargain with the employer. FWA may then make orders to this effect.

“Good faith” bargaining, includes:

  • Attending and participating in meetings at reasonable times;
  • Disclosing all relevant and non-confidential information in a timely manner;
  • Responding and giving genuine consideration to proposals and reasons for responses to those proposals; and
  • Refraining from “capricious and unfair” conduct that undermines freedom of association or collective bargaining.

Any agreement reached in a collective bargain must meet the BOOT (Better Off Overall Test) according to FWA, and comes into effect seven days after its approval is received.

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