Enterprise agreements are deals made between employers and employees and their union about the terms and conditions of their employment. This includes things like:
- Rates of pay
- Penalty rates and allowances
- Hours of work
- Overtime arrangements
- Dispute resolution procedures
Enterprise agreements can be fine-tuned to suit the needs of a specific workplace or sector. They are required to offer better conditions than the relevant award that would otherwise apply.
Agreements are reached through negotiation between an employer and employees and their union.
Unionised workplaces usually have better wages and conditions, because employees working together with the resources of a union behind them have more bargaining strength.
Better off overall
Once an agreement is in place the relevant award no longer applies. The only parts of the award that remain in place are:
- Minimum rates of pay
- All minimum standards provided by the National Employment Standards
- Any terms that apply specifically to outworkers
Although employers and employees can both make concessions when coming to an agreement, agreements must always leave employees better off overall than they would have been under the relevant award.
Agreements must be registered and approved by the Fair Work Commission before they come into effect. They remain in place until they expire or are terminated.
Types of agreement
There are three main types of enterprise agreement:
Agreements made between a single employer and their employees.
Agreements made between a group of employees and multiple employers. These are most relevant when multiple employers all operate in the same workplace.
Agreements made between employers and a union in a new workplace. Greenfields agreements are made before the employer has employed anyone, which is why it is vital that unions are involved—so that future employees are sure to get a fair deal.
If you need to know more, you can contact your union or the Australian Unions Support Centre for free, confidential information and advice about any workplace issue.
Funding for this factsheet was provided by:
- the Victorian Government as part of the uTech project; and
- the Fair Work Ombudsman.
Please note that the information given here is general information only and is not legal advice. For further assistance, it is recommended you speak to your union.