Planning for Enterprise Bargaining

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Transcript - Planning for Enterprise Bargaining

I want to take the opportunity today to provide some timely advice about enterprise bargaining and point out some key aspects for you to consider in preparing for bargaining.

Under the Fair Work Act, there are a number of procedural steps that must be observed in the bargaining and approval processes. If those procedures are not observed, your agreement will not be approved by Fair Work Australia.

Clearly, the key to successful bargaining outcomes is preparation. Bargaining commences when the company initiates bargaining or agrees to bargain or Fair Work Australia issues an Order that will trigger bargaining. A tip, at this point, is don't initiate or agree to bargain until your preparation and planning is finalised.

There are some good reasons for this. Firstly, once bargaining commences, certain obligations come into play. Employee Representational Rights Notices are a mandatory step to enable each employee who will be covered by the proposed agreement to nominate a bargaining representative for the negotiations. Secondly, the principles of good faith bargaining apply to the bargaining representatives once negotiations have commenced. Fair Work Australia has the power to issue orders if the good faith bargaining principles are breached. Thirdly, once the bargaining has commenced there is no turning back.

Ai Group is called on regularly to assist member companies in the planning stage to develop a 'fit for purpose' strategy that will best suit the needs of the business.

Some tips now on preparation. Have a look at your previous history of bargaining

• has it been a successful experience for the business or has it been subject to industrial action. Importantly, what does the company want to achieve from this negotiation - improved productivity and efficiency or are there certain key "business milestones" which will occur during the life of the next agreement? What are the 'must haves' for the business from the bargaining?

Make sure that you clearly understand the breadth of the bargaining laws and the rights and obligations that go with them. Ai Group is well placed to provide training to your management team on the Fair Work bargaining laws.

Two related issues to consider in planning are - the nature of the relationship between management and the workforce and the level of union involvement in the business and their level of influence on employees. Unions often become bargaining representatives because if an employee who is a union member doesn't nominate another bargaining representative, the union is deemed to be the bargaining rep.

Another critical issue to be built into the strategy is contingency planning. If the negotiations breakdown and employees seek to pursue protected industrial action, how will the company maintain supply to its customers and clients? There are certain steps that companies can take to attempt to minimise the impact of industrial action.

Finally, prior knowledge of likely claims by employees and their representatives at least allows companies to prepare appropriate responses for the negotiations. Ai Group is well aware of the common clauses being pressed by unions in bargaining and can provide tips on appropriate responses.

Some of the other procedural steps referred to earlier that must be followed relate to the approval process by employees and Fair Work Australia. Once the negotiations have finished and the agreement is ready for approval by employees, they must be provided with a copy of the agreement at least seven clear days before they are asked to vote. If an award or any other relevant material, such as company policies, are incorporated by reference into the agreement, those documents must be made available to them as well.

During the seven day consideration period, there is a requirement for the employers to explain the terms of the agreement to relevant employees.

Once a simple majority of the employees, who cast a vote, approve the agreement it must be lodged for approval with Fair Work Australia within 14 days of the last employee vote. Fair Work Australia must assess the agreement against the Better Off Overall Test, or BOOT, which means that the employees must be better off overall by entering into the agreement tested against the relevant award that would otherwise apply to them. A tip, therefore, is to be satisfied that your agreement will pass the BOOT test before lodging it with Fair Work Australia. Once approved by Fair Work Australia, the agreement becomes operative seven days after the approved date.

As I mentioned earlier, Ai Group is regularly requested to assist members with the bargaining process from the strategic planning stages, involvement in negotiations through to the approval of the agreement including any advocacy in Fair Work Australia.

One of our professional Advisers can assist you in your bargaining.