Are unregistered agreements permitted?

The Code provides that a code covered entity must not make an agreement, implement an agreement or bargain in relation to an agreement in respect of building work that will not be registered, lodged or otherwise approved under the FW Act , and either:

  • deals with matters that would be not be permitted (by section 11) to be included in the agreement if the agreement were an enterprise agreement
  • provides for terms, conditions or employment benefits of the employer’s employees or subcontractors (which may include above-entitlements payments)
  • restricts or limits the form or type of engagement that may be used to engage subcontractors.

Such an agreement is also not permitted if the code covered entity reasonably believes it will not be registered, lodged or otherwise approved under the FW Act.

For example, an unregistered site agreement or project agreement between a head contractor and a relevant union would be an unregistered written agreement.

Is a common law or individual flexibility agreement permitted?

The requirements outlined above do not apply to a common law agreement made between an employer and an individual employee or to an individual flexibility arrangement.

What types of agreements are permitted?

Agreements that deal with these matters are not intended to be prohibited:

  • community, welfare or charitable activities
  • initiatives to promote the employment of women, Aboriginal and Torres Strait Islander peoples, mature age persons or other groups of workers disadvantaged in the labour market
  • workers’ health and wellbeing initiatives (such as health checks, suicide prevention, screening for dust diseases, drug and alcohol awareness and treatment)
  • programs to reduce bullying, sexual harassment or workplace discrimination
  • initiatives to encourage fair, cooperative and productive workplace relations across the industry
  • initiatives to promote the take-up and completion of apprenticeships, such as mentoring programs.

Preparing draft enterprise agreements during bargaining is also permitted.

Example: Side deeds

Julie is the Director of landscaping company Julie’s Landscaping Pty Ltd. Julie’s employees are covered by an enterprise agreement between her company and a union. In order to work on a particular site, Julie wants to make a side agreement with the union to pay higher rates to her workers on that site.

Is Julie allowed to make the side agreement with the union?

No, Julie would be in breach of the Code if she made the side agreement (also known as a side deed) with the union. Under the Code, it is prohibited to make agreements about benefits for employees where the agreement is not registered, lodged or otherwise approved under the FW Act. The only exceptions are a common law agreement or an individual flexibility arrangement under an enterprise agreement.

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