Strike First To Go

The Coalition’s Fair Work Amendment (Bargaining Processes) Bill 2014 was recently read for a second time in the House of Representatives.

The Bill seeks to introduce changes to the bargaining process for an enterprise agreement, as well as the requirements for approval of an enterprise agreement.

Bargaining for an Enterprise Agreement

The Bill seeks alterations to the Fair Work regime to tighten the circumstances within which protected industrial action can be taken by unions and workers.
The Fair Work regime for bargaining for an enterprise agreement intends for industrial action to be a measure of last resort. This is clearly not the case since the decision in JJ Richards1. In this case the Federal Court held that it was possible for the Fair Work Commission (FWC) to make a protected action ballot order2 in circumstances where bargaining had not commenced. In practice the decision has meant that unions and workers have the option of bypassing bargaining to proceed straight to industrial action against an employer, something which the Bill attempts to rectify.

An amendment is proposed to section 443 to provide that the FWC must make a protected action ballot order where it is satisfied the party seeking the order is genuinely trying to reach agreement with the employer.

In making such a change, the FWC would then be required to have regard to a range of factors (as articulated by the Full Bench in Total Marine Services3) before making a protected action ballot order:

  • The steps taken by each applicant to try to reach an agreement;
  • The extent to which each applicant has communicated its claims in relation to the agreement;
  • Whether each applicant has provided a considered response to proposals made by the employer; and
  • The extent to which bargaining for the agreement has progressed.

The amendment will also provide that the FWC must not make a protected ballot order where it is satisfied that the claims of an applicant for a protected action ballot order are manifestly excessive or would have significant adverse impact on productivity at the workplace.

A clear aim of these proposed amendments is to preclude a union or worker from seeking or threatening to seek a protected action ballot in order to take industrial action without first engaging in meaningful negotiations with an employer.

Approval of an Enterprise Agreement

The Coalition has long considered that Australia has a productivity problem.
At present, the Fair Work regime lists a range of factors the FWC must consider in approving an enterprise agreement, with productivity not one of those factors.

The Bill would insert a new section 187(1A) which would require the FWC, before approving an enterprise agreement, to be satisfied that improvements to productivity at the workplace were discussed during bargaining for the agreement, which is an interesting development.

Employers will welcome the proposed amendments to the Fair Work regime.

The Bill’s progress through Federal Parliament may not be straightforward because of a hostile Senate, which has become more unpredictable following Tasmanian Senator Lambie’s decision to leave the Palmer United Party.

We will keep you informed of the progress of the Bill.

1 JJ Richards & Sons Pty Ltd v Fair Work Australia [2012] FCAFC 53.
2 for proposed industrial action.
3 Total Marine Services Pty Ltd v Maritime Union of Australia [2009] FWAFB 368.
For more information, please contact:
Ben Duggan

Ben Duggan
p.  +61 8 8124 1881
e.  Email me

This communication provides general information which is current as at the time of production. The information contained in this communication does not constitute advice and should not be relied upon as such. Professional advice should be sought prior to any action being taken in reliance on any of the information. Should you wish to discuss any matter raised in this article, or what it means for you, your business or your clients' businesses, please feel free to contact us.

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