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By Lucy Harper, Associate and Lindsay Carroll, Deputy CEO and Legal Practice Director

The National Retail Association recently facilitated its inaugural Enterprise Agreement Stakeholder Panel (EASP) meeting. The EASP is a forum for members to facilitate discussion and learning about enterprise bargaining and build industry insights into the current state bargaining in the retail sector. The Panel has been put together to also inform the positions taken by the NRA in our advocacy and as the retail industry’s representative within the Fair Work Commission’s (FWC) Enterprise Agreement User Group.

The first meeting was focused on the current political context and also, recent legislative changes to the Fair Work Act 2009 (Cth) which provide the FWC with greater discretion to overlook minor procedural or technical defects in enterprise agreement approval applications in certain circumstances. The NRA was proud to have Deputy President Masson of the FWC present to the panel and share insights into some of the common issues with enterprise agreement approvals in the retail industry.

EASP meetings will be held quarterly. If you are interested in participating in the EASP, please contact the Workplace Relations team for more information.

Common errors in approval applications for retail enterprise agreements

Deputy President Masson of the FWC remarked on a number of common errors in applications for approval of retail enterprise agreements. Among the most significant were:

  • The absence of terms providing for the payment of overtime for part time employees (i.e. overtime being payable for hours in excess of full-time hours only and not for hours in excess of their agreed hours);
  • The absence of a minimum engagement period for part-time and casual employees, or a shorter period than is provided for in the General Retail Industry Award;
  • Errors concerning leave entitlements enshrined in the National Employment Standards:
    • Leave being expressed within agreements in hours/days rather than by weeks; and
    • The absence of a provision for annual leave loading to be paid out on termination; and
  • Agreements providing for loaded rates for casual employees without evidence of current and prospective employees being better off working proposed work patterns under the Agreement.[1]

Even with the FWC’s new discretion to overlook minor procedural or technical errors in such applications, the errors must not have disadvantaged employees in relation to their ability to genuinely agree to the terms of the proposed agreement. Whether such disadvantage occurred or was likely to have occurred could be the subject of debate between employers and bargaining representatives and so, to avoid disputation, errors such as the ones identified by the FWC above ought to be avoided.

A note about collective agreements in the current political climate

As reported in February, the last twelve months have seen increasing media scrutiny and union activism in relation to collective agreements, with the unions and the media clamouring for the termination of these agreements as they are perceived as “unfair”.

‘Zombie agreement’ is a term used by the ACTU to describe collective bargaining agreements past their nominal expiry date, particularly agreements made before the Fair Work Act 2009 came into effect.

In recent times, agreements of this kind have been under increasing scrutiny, with Labor promising an unspecified ‘effective mechanism’ for the termination of these agreements if elected to government.

Not surprisingly, this has resulted in an ever-increasing trend of these agreements being terminated, with the Fair Work Commission handing down 121 decisions to terminate these agreements in the 2017-18 financial year – the highest number since the Fair Work Act was introduced.

With ‘zombie agreements’ potentially on the chopping block in the near future, now is the time for businesses operating under these agreements to take control of the process and determine how they will operate once the axe falls – whether it be under a new agreement, or under the modern awards – rather than wait for another party to take that decision away from them.

If you would like assistance in this regard, please call the NRA’s workplace relations team on 1800 RETAIL (738 245) to discuss further.

[1] In Loaded Rates Agreements [2018] FWCFB 3610 it was found there is difficulty in establishing a loaded rate structure for casual employees which is capable of passing the BOOT.