A company agreement sets out the working conditions agreed collectively between an employer and a group of workers, which are normally concluded in good faith after negotiations between the employees, their collective representatives (often involving a union) and the employer. While parties seeking to negotiate an inter-company agreement are theoretically subject to good faith bargaining obligations, bargaining orders cannot be obtained from the Fair Work Commission to enforce these obligations. Protected industrial action cannot be taken to conclude a business-to-business agreement, but licensing requirements for workers are stricter than individual company agreements. Sole proprietorship agreements are the most common type of collective bargaining and are generally used when an employer operating an existing “business” enters into an agreement with its employees – a “business” is defined broadly and includes a business, activity, project or business. If a company agreement is not registered, it may not be legally enforceable. There are 2 main types of company agreements that can be concluded under the Fair Work Act: An employment contract cannot allow an employer to exercise power that is incompatible with a company agreement. If a condition of an employment contract is less favourable than that of a company agreement, the company agreement takes precedence over the contract. However, if the unregistered agreement is formalized as an act or if the terms of the agreement are incorporated into an employment contract, these documents may become legally enforceable. The parties approve among themselves the proposals for company agreements (in the case of employees, they will be put to the vote). The Fair Work Commission then evaluates them for approval.
(Under the Fair Work Act 2009, agreements are now renamed “company agreements” and filed with the Fair Work Commission to assess claims against the modern award and be reviewed for violations of the law.)  Since the entry into force of the Fair Work Act, parties to Australian federal collective agreements have submitted their agreements to Fair Work Australia for approval. Before a company agreement is approved, a tribunal member must be satisfied that the employees employed under the agreement are generally “better off” than if they were employed under the corresponding modern arbitral award. Company agreements are enterprise-level agreements between employers and workers and their trade unions on working conditions. Company agreements can cover a wide range of issues, such as: It is important to note that the bargaining obligations of the Fair Work Act do not currently apply in good faith to the negotiation of an entirely new agreement, giving a union involved in the bargaining process significant influence. Potential employers wishing to develop a new project should, as part of their industrial strategy, carefully consider which unions have potential coverage rights and may be more willing to enter into a new agreement on better and more favourable terms for their company. If a company agreement does not comply with the BOOT, the FWC can still approve it if there are “extraordinary circumstances” and its approval would not be contrary to the public interest. However, the base wage rate in a registered operating contract cannot be lower than that of a modern arbitral award. In addition, the ESS continues to apply, as do any conditions for external workers that are specified in an award. In the context of Australian labour law, the Industrial Reform of 2005-2006, known as “WorkChoices” (with corresponding amendments to the Industrial Relations Act (1996)), changed the name of these collective bargaining documents to “collective agreement”. State labour law may also require collective agreements, but the adoption of the WorkChoices reform will reduce the likelihood of such agreements.
A company agreement lays down the minimum conditions of employment between one or more employers and their employees or a group of their employees. The Agreement may apply independently of other awards or include certain terms of the respective parent prize. A company agreement must include a consultation period. Therefore, employers should consult with their employees (and/or a relevant union) about major changes in the workplace that are likely to have a significant impact on them. A “true new business” can include a new business, a new job or a new project started by an existing employer. Such an agreement can only be concluded with one or more relevant workers` organizations (e.g. a trade union), as opposed to workers alone. Employers, employees and their representatives in collective bargaining participate in the process of negotiating a draft company agreement. An employer must inform its employees as soon as possible, but no later than 14 days after the date of notification of the agreement (usually the start of negotiations), of its right to be represented by a collective bargaining representative when negotiating a company agreement (with the exception of a greenfield agreement). The notification must be given to any current employee covered by the contract of employment.  Business-to-business agreements are much less common and are concluded between two or more employers who are not employers with a common interest.
An entirely new agreement can be made for a truly new business that a single employer or multiple employers are starting or intend to start. These types of company agreements must be concluded with at least one trade union and before the recruitment of persons covered by the agreement. Each trade union party to the agreement must be able to represent the majority of workers covered by the agreement. Company agreements can be terminated in a variety of ways, including: FREE Guide to Fair Work Law Download For tips on negotiating a company agreement and other useful information, fill out the online form below to request a free consultation with an Employsure labour relations specialist. These may be carried out by a single employer or two or more employers, provided that they are affiliated undertakings, operate a joint venture or joint venture or have obtained authorisation from the SBB for an `employer with a single interest`. There may be more than one agreement within a company covering different groups of workers. There are three types of company agreements – sole proprietorships, multi-company agreements and new company agreements (which can be an individual or multi-company agreement), each of which is discussed below. While bonuses cover minimum wages and working conditions in an industry, company agreements may cover specific agreements for a particular company. The EAs had a peculiarity in Australia: when negotiating a national enterprise collective agreement, a group of workers or a union could take industrial action (including strikes) without legal sanctions to enforce their demands.
The three types of employment contracts that can be concluded are: An employer may have separate company agreements with different groups of workers, the conditions of which are specifically tailored to that group.