Enterprise Agreements - The Approval Process

The Fair Work laws allow parties to move from award coverage to a collective or enterprise agreement. Individual agreements (AWA’s) are no longer an option in the new framework.

Changes have also been made to the process of having agreements approved.
This Fact Sheet provides a summary of what’s changed. Further details can be obtained by attending one of the Member Briefings VECCI is holding on the new Fair Work laws. The Helpline can also provide further advice and information.

What’s  Changed  Already?

The Government has already moved to change the approval process that existed under “WorkChoices”. From March last year agreements only commence after having been lodged and approved by the Workplace Authority. The “no disadvantage test” was also reinstated as the test to be satisfied before an agreement could be approved.

More Changes on the Way

From 1st July Fair Work Australia takes over the responsibility of approving agreements. Parties will be required to appear before the tribunal as part of that process, as agreements continue to be assessed against the “no disadvantage test”.

Further changes come in to effect on 1st January, 2010. Agreements will continue to be assessed by Fair Work Australia. However, they will be assessed against a new “Better Off  Overall Test” (the BOOT).

 It involves a comparison between the terms of the proposed agreement and both the relevant modern award and the 10 National Employment Standards.  Fair Work Australia will need to be satisfied the parties genuinely agree and the agreement does not contain any unlawful content. For multi – employer agreements it will also need to be satisfied each employer has genuinely agreed and there has been no coercion.