The recent Jobs and Skills Summit facilitated by the Commonwealth government and attended by government representatives, business leaders, employer groups, unions and industrial relations academics has brought multi-employer enterprise bargaining into the spotlight.
Multi-employer enterprise bargaining is where workers and employers across a particular industry or sector join together to bargain for an enterprise agreement which will apply more broadly than a single enterprise.
Currently, collective bargaining almost exclusively occurs at the enterprise level, i.e. between an individual employer and its workforce, or a part of its workforce. The result of enterprise bargaining, an ‘enterprise agreement’ made between the employer and its workers, once approved by the Fair Work Commission, will displace the terms of any applicable modern award to set the minimum entitlements for employees covered by the agreement in the workplace.
The Australian Council of Trade Unions (ACTU) and the Council of Small Business Organisations Australia (COSBOA) have reached an agreement on various proposed industrial relations reforms, including multi-employer enterprise agreements. The Minister for Employment and Workplace Relations, Tony Burke, has lauded the proposed reform agreement as opening up opportunities for small businesses “forever locked out” of enterprise bargaining.
Currently, enterprise agreements for small businesses are relatively uncommon, but unions are starting set their sights on this space within the economy. Earlier this year, Sydney-based bookstore Better Read Than Dead and the retail workers’ union broke new ground when they negotiated an enterprise agreement for its 18 employees, emboldening the union to commence negotiations with other independent booksellers.
From the government’s perspective, the proposed reform agenda means that more small businesses, which generally do not have human resources or specialist industrial relations departments to assist them with enterprise bargaining, will be able to take advantage of efficiencies that may be created by multiple smaller businesses bargaining at once. The government has gone so far as to indicate its intention to "amend the Fair Work Act to give the Fair Work Commission the capacity to proactively help workers and businesses reach agreements", including small and medium businesses.
However, support for multi-employer enterprise bargaining is far from unanimous. The Australian Industry Group has called multi-employer enterprise bargaining a “clear red line for industry”, and many businesses remain to be convinced of the merits of wholesale enterprise bargaining reform introducing industry-wide bargaining.
Multi-enterprise bargaining has the potential to significantly change the industrial relations landscape for Australian businesses. It could possibly see collective bargaining, traditionally the preserve of larger businesses, increasingly become a feature of small and medium business.
On one hand, smaller enterprises could leverage efficiencies created by multiple businesses working together to negotiate more bespoke minimum terms of employment for their workplaces. On the other hand, it could lead to a new layer of workplace relations complexity, an increased compliance burden and increased costs for smaller enterprises. It may also increase the likelihood of protected industrial action (e.g. strikes) impacting smaller enterprises in the event that multiple employer enterprise bargaining negotiations break down.
Small and medium businesses may want to monitor developments in this area as the Albanese government rolls out its legislative agenda for the future for industrial relations in Australia.
If you have questions, or would like more information about how these recent developments could affect your business, please call 1800 867 113 or to organise a confidential discussion with one of our lawyers at a time that suits you, click here.
Stephen Schoninger leads the employment and workplace law practice at Avant Law, based in Sydney. Stephen has over 18 years’ experience practising exclusively in employment, industrial relations and discrimination laws. Stephen is called on for his ability to plainly advise on and pragmatically apply legal principles to manage and resolve complex issues arising in the workplace. Stephen advises employers and employees in the private and public sectors on all areas of workplace law and is an experienced litigator of work-related claims. Stephen also conducts workplace investigations and delivers workplace compliance training. He regularly presents seminars on topical employment and workplace law issues.
Disclaimer: The information in this article does not constitute legal advice or other professional advice and should not be relied upon as such. It is intended only to provide a summary and general overview on matters of interest and it is not intended to be comprehensive. You should seek legal or other professional advice before acting or relying on any of its content. The information in this article is current to 5 September 2022.
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