Update on changes to making enterprise agreements

In brief - The Fair Work Commission's latest statement has provided some guidance on upcoming changes to enterprise bargaining from the Secure Jobs, Better Pay Act, including what constitutes the 'genuine agreement' of employees

The Acting President of the Fair Work Commission (FWC) has released a statement dealing with the amendments to provisions dealing with making enterprise agreements, set to commence from 6 June 2023. 

The statement:

• Explains amendments to what constitutes the Genuine Agreement of employees in the Secure Jobs, Better Pay Act (Act); and 

• Sets out the timetable for the FWC to make the new Statement of Principles outlining what matters will be taken into consideration when determining whether the enterprise agreement (EA) has been genuinely agreed to. 

The Act's Explanatory Memorandum states that these amendments simplify the approval process, replacing existing requirements for approval with a single broad requirement that the EA has been 'genuinely agreed to' by the employees. 

Genuine agreement 

Genuine agreement will be established with respect to a new section 188 of the Fair Work Act, factoring in: 

• the matters set out in the Statement of Principles (TBC); 

• whether the employees who are requested to vote on the agreement have a sufficient interest in its terms, and are sufficiently representative of the employees to be covered;

• for multi-enterprise agreements, whether written agreement to put the agreement to a vote is obtained from the relevant employee organisations; 

• where notice of employee representational rights was required, whether such notice was given; and

• whether the terms of the agreement have been sufficiently explained to the employees who are requested to vote.

The existing safeguard which allows for EA approval despite minor technical or procedural deficiencies will continue. 

Key dates for Fair Work Commission's Statement of Principles

The Statement of Principles must deal with at least seven prescribed matters, including things like providing employees with a reasonable opportunity to consider a proposed EA. The Explanatory Memorandum claims this statement will give employers guidance as to how genuine agreement will be interpreted by the FWC. 

President Hatcher's statement provides a timeline for when to expect the Statement of Principles to be made. 

Key dates include: 

• Week commencing 27 February 2023: statement with draft Statement of Principles to be published for comment 

• Week commencing 27 March 2023: Closing date for submissions

• Late May 2023: Final Statement of Principles registered with the Federal Register of Legislation 

• 6 June 2023: Statement of Principles commences operation 

Other changes are set to commence on 6 June, including amendments to the Better Off Overall Test, bargaining disputes and multi-enterprise bargaining. 

The FWC is set to release further statements in the coming months.