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Enterprise Bargaining in NSW: Step 1

Step 1 - The Parties

General Information

Before an enterprise agreement can be negotiated, it is necessary to determine who is going to represent the employees. The parties to the enterprise agreement are the enterprise employer and either:

1. the employees to be covered by the agreement; OR
2. one or more trade unions representing the employees.

Who can the employer be?

The employer party to a NSW enterprise agreement can be:

• an individual employer;
• a group of two or more associated employers;
• a group of employers engaged on a project;
• an employer association acting on behalf of the employer eligible to belong to the employer association.

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How to begin the process

Before an employer and his/her employees can begin the negotiation process, a decision has to be made as to how the employees are going to be represented. This decision should be made in a spirit of cooperation. The following factors could assist employees in making the decision:

• the number of employees at the enterprise;
• the role of the trade unions at the enterprise;
• existing consultative arrangements;
• whether the enterprise is located on one site or several sites;
• the number of trades or occupations to be covered by the agreement; and,
• the degree of industrial expertise of the employees.

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Option One - One or More Trade Unions

Employees can choose to have a trade union represent them because they feel that the union has more expertise in negotiation than they do. Employees may feel that the union would do a better job of speaking on their behalf in the negotiations. Many enterprises may already have a consultative committee in place for union representatives to speak with management on behalf of employees and these committees are often the logical choice to bargain the enterprise agreement.

If no such consultative committee exists, the negotiation of an enterprise agreement can be an excellent way of establishing consultative mechanisms (see Step 3 for more information about establishing consultative committees).

It should be noted that if negotiations are undertaken by a union there is no requirement for the employees to approve the enterprise agreement by way of a secret ballot. However, there may be a requirement under the registered rules of the union for union members to approve the enterprise agreement negotiated on their behalf.

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Option Two - The Individual Employees

Under this option, employees negotiate directly with their employer.

There are added safeguards provided in the Act for employees who decide to represent themselves in the negotiations:

1. Before or at the time when the employer first undertakes formal negotiations, the Industrial Registrar is to be advised by submitting a Form 15 to the Industrial Registrar, so that the relevant industrial organisations can be notified. A copy of this form can be found in Appendix 5.
   
2. The agreement must be approved by at least 65% of the employees to be covered by the agreement by way of secret ballot. The employer cannot be involved in the ballot so that no pressure is placed on the employees to vote in a particular way. For more detailed information about secret ballots please see Step 5.

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Industrial Organisations becoming a party to an Employee/Employer Agreement

Industrial organisations have an option of becoming a party to an enterprise agreement that they have not been involved in negotiating. The Industrial Relations Act 1996, identifies the process that must be must be followed prior to the Commission making an industrial organisation a party to the agreement,

After an application has been made to approve the agreement, the Commission must, by its order, make an industrial organisation a party to that agreement if the Commission is satisfied that:

1. the industrial organisation represents any of employees covered by the proposed agreement, and
2. the industrial organisation has notified the Commission of its intention to become a party to the agreement by lodging notice to that effect with the Industrial registrar at any time prior to the Commission approving the agreement, and
3. an employee covered by the agreement is a member of the industrial organisation and has requested the industrial organisation become a party to the agreement