The Law Handbook 2024

Chapter 11.5: Employment contracts, awards and agreements 1059 overall if the agreement applied to them than if the relevant modern award was applied. If an enterprise agreement does not pass the BOOT, the FWC can accept an undertaking from the employer to remedy the deficiencies. Approval by the parties to the agreement There are different approval procedures for each type of enterprise agreement (s 182 FW Act): • For a single enterprise agreement (that is not a greenfields agreement): the agreement is made when the majority of employees cast a valid vote in favour of approving the agreement. • For a multi-enterprise agreement (that is not a greenfields agreement): the agreement is made when the majority of employees of at least one of the employers cast a valid vote in favour of approving the agreement. • For a greenfields agreement : the agreement is made when it is signed by the employer and each employee association (usually a trade union) that is expressed to be covered by the agreement. An employer must take reasonable steps before the agreement is voted on to ensure: • the employees have had access to the written agreement; • the employees are advised of how, when and where the vote will take place; and • the terms and effect of the agreement have been explained to the employees (ss 180, 188 FW Act). It is unlawful to engage or threaten to engage in any action with the intention of coercing a person to, or not to, make an enterprise agreement, or to approve or vary or terminate such an agreement. Approval by the Fair Work Commission Enterprise agreements come into force only once they have been approved by the FWC. Before approving an enterprise agreement, the FWC must be satisfied of a number of matters under section 186 of the FW Act, including: • that the pre-approval steps have been taken; • that the agreement passes the BOOT, or if it fails the BOOT, it should be otherwise approved (see ‘Better off overall test’, above); • that the agreement does not contravene section 55 of the FW Act, including that the agreement does not seek to exclude any provisions of the NES (s 186(2)(c) FW Act) or contain any unlawful terms or designated outworker terms; • that the agreement includes an expiry date of not more than four years after the FWC approves the agreement; • that the employees to be covered were fairly chosen; • that the agreement provides a process for dispute settlement; and • if the agreement is not a greenfields agreement, that the employees genuinely consented to the agreement (s 186(2)(a) FW Act). Content of enterprise agreements under the Fair Work Act The content of an enterprise agreement is mostly a matter for the parties. However, the FW Act requires, permits and prohibits some content. Under section 55 of the FW Act, an enterprise agreement cannot exclude the NES or any provision of the NES (see ‘National Employment Standards’, above). Part 2-2 of the FW Act allows enterprise agreements to deal with some matters in the NES. What an agreement should contain Under the FW Act, an enterprise agreement should contain: • A nominal expiry date . This is the date after which the agreement may be replaced by a new agreement. Under the FW Act (s 186(5)), the date may be specified in the agreement but must – other than for agreements failing the BOOT but approved on the basis of special circumstances – be no later than four years after the date the agreement was approved by the FWC. If no date is specified in a collective agreement, then the nominal expiry date is four years from the date it is approved by the FWC. For agreements failing the BOOT but approved on the basis of special circumstances, the nominal expiry date is the earlier of the date in the agreement or two years after the day on which the FWC approved the agreement (s 189). • A dispute settlement procedure that deals with disputes about any matters arising under the agreement and in relation to the NES (s 186(6)). • Minimum entitlements . Although not required to be part of a workplace agreement, the NES