Undertakings in Enterprise Agreements

An appeal was lodged against the Commission`s decisions refusing to approve ten agreements containing preferential hours clauses. The clauses provided that if an employee requested overtime, that overtime would be paid at its normal hourly rate and would not result in overtime pay. In these uncertain times, employers will be reassured by the Commission`s pragmatic approach, with the plenary stressing that the focus is on the nature of the resulting changes and not on the number of commitments made or the number of changes resulting from a particular undertaking. AWU appealed the decision to approve the agreement, arguing, among other things, that the negotiators had not received copies of the commitments or that they had been asked for their opinion. The plenary noted that the legislation required all representatives of collective bargaining, including the UTA and self-appointed workers, to receive a copy of the companies and their requested opinions. Kore Construction has proposed a number of commitments to address the Commission`s concerns. The CFMEU argued that the proposed commitments would entail a substantial amendment to the agreement and should not be accepted. In an important decision on the agreement, a plenary session of the Fair Work Committee clarified when the Commission can accept an obligation under an application for approval of a company agreement. Relying on Kaefer, in CFMMEU v. C&H Acquisition Pty Ltd [2020] FWCFB 3134, the plenary held that the term “substantial” in the context of the agreement refers to the quality of changes resulting from a commitment and not the number of commitments entered into or the number of changes resulting from the commitment. The full-fledged bank noted that acceptance of the commitments was crucial to the Commission`s determination to approve the agreement.

The bank as a whole found that, in those circumstances, the Commission had found a coincidence in approving the agreement, since the commitments could not have been accepted because they could not fulfil the condition set out in paragraph 190(3)(b). The appeal was allowed and, given the extent to which the companies had changed the terms of the agreement, the appeal was allowed and the decision set aside. The Commission noted that the nature of the proposed commitments showed that each of them was trying to remedy any financial disadvantage compared to modern public procurement. However, when examining the companies as a whole, it became clear that they had led to significant changes to the agreement. The companies made changes to the rates of pay as part of the investigations contained in the agreement, the inclusion of significant new elements in the agreement and the inclusion of significant allowances that were not previously included in the agreement. According to the Fair Work Act 2009, the following new company agreements can be concluded: Employees can take collective action when negotiating a draft company agreement. There are strict rules for trade union action under the Fair Work Act 2009, including the rights, duties and obligations of employers, employees and their organisations. Further information can be found in the Fair Work Ombudsman – Trade Union Actions factsheet. In the national industrial relations system, there are two categories of agreements: written obligations under section 190 of the Fair Work Act 2009 An individual company agreement is concluded between a single employer (or more than two employers with a single interest) and employees employed at the time of the agreement and covered by the agreement. In our experience, very few agreements go through the approval process without a few questions from the Commission and a call for commitments.

In some cases, the invitation to enter into an obligation reflects a pedantic and overly narrow interpretation of the agreement on the basis of the award in question. In other cases, the request to submit a bond corrects unintentional monitoring, which could lead to the parties returning to the site and having to proceed with another vote in the future. Calls for reform of Australia`s industrial relations system have multiplied recently, with employers` groups and unions claiming that corporate negotiations in Australia are “ineffective” and “broken”. To consider commitments proposed solely on the basis of the expression used in companies as an amendment to an agreement and not as a company means “to take an unnecessarily technical approach to donor commitments that is not justified”. [11] The Commission noted that it was clear from the nature of the proposed commitments that each company was attempting to offset the financial disadvantages resulting from the agreement compared to the modern arbitral award. However, when examining the commitments as a whole, it became clear that they had led to substantial changes to the agreement. The parties concerned changes in the rates of pay attached to the classifications of the agreement, the inclusion of substantial new provisions in the agreement and the inclusion of material remuneration not previously provided for in the agreement. The plenary noted that the commitments, which covered almost 5 pages of text, were extensive and exhaustively amended a number of terms of the agreement. While some projects were relatively insignificant and fully beneficial to workers, others were much larger.

In some cases, members of the Commission expressed concern about the number of commitments that would need to be made to obtain approval of the agreement. For employers who are currently negotiating a company agreement or who may be considering negotiations in the future, the plenary decision in CFMMEU v. C&H Acquisition Pty Ltd [2020] FWCFB 3134 provides useful tips on the types of questions that can be referred to a company….