An enterprise agreement is just like an award.  It sets out the minimum conditions of employment for employees engaged in particular types of work in the same way as an award. However, unlike most awards, enterprise agreements are specific to a particular enterprise or project.

Many NSW businesses are covered by enterprise agreements or other forms of collective agreement.

Enterprise agreements are collective agreements negotiated voluntarily between an employer and either the employees concerned or a union on the behalf of those employees. They have the same legal force as an award and must be approved by the Industrial Relations Commission of New South Wales.

The Commission will not approve an enterprise agreement unless it is satisfied that the agreement does not, on balance, provide a "net detriment" to the employees. The Commission will do this by comparing the aggregate (or whole) package of conditions of employment under the agreement with the relevant award.

Enterprise agreements may cover some or all of the employment conditions in a NSW award. If the employees are working under a NSW award/s, it is essential that both the employees and their employer are familiar with the conditions of employment contained in the relevant award.

If the enterprise is currently award free, an enterprise agreement will provide the same legal protection as a NSW award.

All agreements must comply with all relevant NSW or federal laws which provide employment rights and obligations such as minimum entitlements to parental, annual and long service leave. Tests are always applied before approval to ensure employee entitlements under the new agreement are not less than provided in the relevant award.

Federal Collective Agreements  (both union and non-union types) must be approved by a majority of the employees that are covered by the collective agreement. An individual agreement is an agreement between an employee and an employer, though either party may appoint a bargaining agent (eg. a union) to assist them with the bargaining process. Both federal collective agreements and individual agreements are filed with and approved by the Fair Work Ombudsman.

For more information about federal agreements contact the Workplace Authority.

top

An enterprise agreement can cover the following categories of employees:

• employees of a single employer
• employees of two or more associated employers
• employees engaged in a project or proposed project
• public sector employees.

An enterprise agreement may cover some or all of the employment conditions of the employees concerned. However, an enterprise agreement must comply with all NSW laws which provide employment rights and obligations, such as minimum entitlements to parental, annual and long service leave.

Every enterprise agreement must be in writing and signed by or on behalf of the parties. The parties to the agreement must be named and the agreement must state who will be covered by the agreement.

An enterprise agreement must contain a dispute resolution procedure where an employer employs 20 or more employees.

Enterprise agreements generally have a nominal term of up to three years, however, they can continue in effect after this time if the parties to the agreement wish this to happen.

top

Where an enterprise agreement is negotiated directly with employees, the employer must advise the NSW Industrial Registrar before or at the time the employer first undertakes formal negotiations. This advice is to be in writing indicating:

• that an enterprise agreement is proposed or under negotiation, and
• which awards or enterprise agreements apply to those employees.

No one can be forced to sign an enterprise agreement. However, where an enterprise agreement has been approved in a secret ballot of the employees concerned, an employee who did not vote in favour of the agreement is still covered once the agreement has been approved by the Commission. Similarly, any new employee to a workplace where there is an enterprise agreement is covered by the agreement, when it applies to the work the employee will be doing.

top

The Industrial Registrar keeps a register of all enterprise agreements approved by the Commission and publishes details in the Industrial Gazette. This register is open to public inspection without charge and any person may make a copy of a document in the register for a fee.

Before employing someone under an enterprise agreement, the employer must advise the person of the existence of the agreement and provide access to a copy or summary of the agreement in a language the person understands.

top