Changes to multi-enterprise bargaining

The changes to multi-enterprise bargaining introduced by the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) are, as of 6 June 2023, in effect. These reforms enable the Fair Work Commission to authorise multi-employer enterprise bargaining through the following three streams:

• supportive bargaining authorisations – replacing the “low paid authorisation stream”, the FWC can require multiple employers to bargain for a new enterprise agreement at the applicable Minister’s direction or if it considers it appropriate taking into account several factors. Relevant factors include, but are not limited to, the prevailing pay and conditions within the relevant industry/sector, whether the employers have clearly identifiable common interests and whether at least some employees covered are represented by a body such as a trade union;
• single interest employer authorisations – enabling the FWC to require employers that are separate enterprises but have a close connection to one another to bargain together for a single enterprise agreement to cover all participating employers and employees. Relevant factors the FWC must consider include, but are not limited to, whether the selection of employees covered was fairly chosen, at least some employees covered are represented by a body such as a trade union, employers were given an opportunity to express their view on the proposed bargaining, whether the employers have clearly identifiable common interests and it is not contrary to the public interest; and
• cooperative workplace authorisations – a new name for the existing multi-employer stream previously in place, that will continue to be in effect.

The increase in streams and scope for multi-employer enterprise bargaining and agreements means more employers will be compelled to bargain together and more employees will be covered by enterprise agreements. This will likely reduce the variation of employees’ terms and conditions across employers to a more standardised approach across sectors.

Employers should re-visit the current enterprise agreements it has in place (if any) to identify the likelihood of being compelled to engage in multi-employer enterprise bargaining and strategies to reduce the disruption to the workforce and its operations.