Workplace agreements set out the conditions of employment between an employee, an employer and, in some cases, a third party. This fact sheet outlines what agreements are and how they should be made.
Types of agreements
The Workplace Relations Act 1996 (WR Act) regulates the following types of employment agreements:
- employee collective agreements
- union collective agreements
- Individual Transitional Employment Agreements (ITEAs)
- Australian Workplace Agreements (AWAs)
- union greenfields agreements
- employer greenfields agreements
- multiple business agreements.
Other than AWAs and ITEAs, workplace agreements are known as ‘collective agreements’ because they are made with a group of employees or a union.
For more information see the
Types of Workplace Agreements fact sheet.
Content of agreements
All types of workplace agreements must:
- pass the no-disadvantage test
- contain the key minimum entitlements provided in the Australian Fair Pay and Conditions Standard (AFPCS) or otherwise contain terms more favourable
- not contain prohibited content
- contain a dispute resolution procedure
The no-disadvantage test will apply to all agreements made after 28 March 2008. Under the test the agreement must satisfy the Workplace Authority Director that it does not, on balance, reduce the overall terms and conditions of employees subject to the agreement compared with a reference instrument relating to the employees. The reference instrument may be an award or another collective agreement.
An employer greenfields agreement will expire one year from the date the agreement is lodged with the Workplace Authority, or an earlier date as specified in the agreement.
Agreement making process
Before a collective agreement, other than a multiple-business agreement, is negotiated a bargaining period must be initiated by the employer, a union, or an employee acting on his or her own behalf and on behalf of other employees.
An initiating notice must be given to all other negotiating parties and the bargaining period will commence 7 days later.
A bargaining period will end when any of the following occurs:
- a collective agreement is made
- the initiating party tells the other parties it no longer wishes to make an agreement
- the bargaining period is terminated by the Australian Industrial Relations Commission.
For industrial action to be lawful during the agreement-making process, the parties must comply with the rules regarding applying for protected industrial action.
Parties involved in negotiations for an ITEA or employee collective agreement may appoint or request a bargaining agent.
An employer must obtain authorisation from the Workplace Authority to make a multiple-business agreement.
For more information on the lodgement of workplace agreements visit the Workplace Authority Website
Offences and penalties
During the process of agreement making, parties must avoid conduct that breaches the WR Act or the Building and Construction Industry Improvement Act 2005 (BCII Act), including:
- coercion to make, not to make, to vary or extend the nominal expiry date, or to terminate an agreement
- coercion in connection with requests for a bargaining agent
- recklessly making a false or misleading statement with respect to prohibited content
- employer discrimination between union and non-union members in connection with negotiations for a collective agreement or variation of such an agreement
- an employer failing to take reasonable steps to notify, and provide copies of, Workplace Authority receipt to persons subject to lodged collective agreement
- an employer failing to lodge an approved AWA, employee collective agreement, union collective agreement or union greenfields agreement
- an employer failing to obtain authorisation before lodging a multiple business agreement
- an employer failing to obtain approval before lodging workplace agreements other than greenfields agreements
- an employer failing to take reasonable steps to seek approval for union collective agreement within a reasonable period after the agreement is made
- an employer failing to provide a copy of, or ready access to, a workplace agreement or information statement to employees prior to approval
- an employer dismissing or threatening to dismiss an employee because an agreement does not, or may not, pass the no-disadvantage test
- an employer failing to take reasonable steps to provide a copy of a notice from the Workplace Authority that an agreement passes or does not pass the no-disadvantage test to employees as soon as practicable.
A breach of the WR Act may incur:
- penalties of up to $6,600 for an individual and up to $33,000 for an organisation
- compensation for loss or damage suffered by an employee
- maintaining the continuity of, or making alterations to, or voiding of, all or part of the workplace agreement.
A breach of the BCII Act may incur:
- penalties of up to $22,000 for an individual and $110,000 for a body corporate
- compensation for loss or damage suffered by an employee
- orders that the conduct be discontinued or prevented from taking place.
Further information
You can download a printable version of this fact sheet here: Agreement Making (PDF - 166KB)
The information contained in this fact sheet is correct as at 28 March 2008.
This material is for general information only. You should seek legal advice in relation to your particular circumstances. The Australian Government, its employees and agents do not accept any liability for action taken in reliance on this document and disclaim all liability arising from any error or omission. ABN 68 003 725 098
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