Changes to Australia’s workplace laws have fundamentally altered how businesses will need to negotiate enterprise agreements (EAs), including through Intractable Bargaining Workplace Determinations.
This provision is now law and in force since gaining Royal Assent on February 26.
Our experts explain how this impacts some businesses and ways that you can best prepare.
What is ‘intractable bargaining’?
Intractable bargaining allows the Fair Work Commission (FWC) to intervene in a deadlocked dispute between a union and an employer. When a dispute reaches the intractable bargaining threshold, the industrial umpire can only make a decision that will land in favour of the unions.
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Does this impact your business?
Intractable bargaining affects all businesses that have an existing EA and are seeking to negotiate a new one.
EAs tend to be utilised in union-heavy industries and generally, with businesses that have more employees.
What does this mean in practical terms for your business?
If a dispute about the bargaining process for a new EA is raised and the employer and union cannot agree, it can go back to the FWC for arbitration. Under the new laws, the FWC will not be able to make any orders that are less favourable than the existing agreement terms and conditions.
This will result in there being no real incentive for unions or employees to concede points during bargaining, knowing that if it goes to arbitration, they will get what is already in the existing agreement or better.
This will cause serious problems for employers trying to negotiate flexibilities because operations have changed, and different terms need to be negotiated. Employers may be willing to give more beneficial terms in other parts of the agreement but need to negotiate down in others.
If employees do not want to give these terms up and it goes to arbitration, the FWC cannot make any orders with lesser terms and conditions.
How can you prepare?
CCIWA’s highly experienced employment law practitioners can assist your business with EA strategies, bargaining negotiations and drafting clauses.
It’s important to start considering your bargaining strategy about a year before it expires.
This will give you time to implement strategies, think about what your business will look like going forward and whether you need to make any major adjustments to how your EA works in practice.
Our IR Masterclass has been updated to include all the latest content in the Closing Loopholes Bill.
Given the extent of the changes, it is recommended that all employers review their employment contracts and policies and procedures.
Contact our Employee Relations Advice Centre for more information about how CCIWA’s employment lawyers and HR consultants can assist with this on (08) 9365 7660, or via [email protected]
