Frequently Asked Questions
Q: How are enterprise agreements made?
Upon the conclusion of the bargaining process and a draft agreement has been created, a number of steps are to be followed to ensure the validity of the agreement.
- Explanation of terms: the terms of the agreement and its effects are to be explained to employees, and must be provided in the appropriate manner;
- Voting on the agreement: the agreement must be endorsed by employees via a vote, and the vote must not occur until at least 21 days after employees were provided notice of their representative rights. During the seven day period before the vote, the employer must provide a copy to employees of the agreement and any other material incorporated by reference in the agreement. Additionally, information of the time of the vote, the location, and the voting method to be used must also be provided.
- Making the agreement: an agreement is made when a majority of employees vote in favour for the agreement, however, the process will differ depending on the type of enterprise agreement:
- single-enterprise agreements (single employer or a joint enterprise)
- multi-enterprise agreements (at least two employees that are not single interest employees
- Greenfields agreement (one or more employers make a proposal for an enterprise agreement, but have not engaged with employees. Greenfields agreements are agreed between the employer and unions.
An application will then be made to the FWC for approval. For an enterprise agreement to receive approval from the FWC, it must consider a number of requirements, such as the agreement were genuinely made with those involved, and that it satisfies the “better off overall test” for example.