Enterprise Agreements
in a CDC Environment?
Damien Ryan
Executive Manager, Workforce & Safety
Australian IR Framework
• National Employment Standards (NES)
• Modern Awards
• Enterprise Agreements
– Mandatory content
– Unlawful content
– Better off overall test (the BOOT)
Approx 59% of community aged care employees are covered by an
enterprise agreement (based on a 33% survey response rate in 2012)
Source: Fair Work Australia 19 October 2012
©Leading Age Services Australia - Victoria
Benefits of enterprise agreements
• Standard and stable conditions
– No extra claims
– Formal process to resolve disagreements and build trust
– Avoids bargaining multiple individual arrangements
• Adapt award conditions to suit the workplace
– Increased flexibility (e.g. hours of work)
– Increased wages & conditions
– Increased productivity & competitiveness
©Leading Age Services Australia - Victoria
Are these benefits under CDC?
• Is there a risk in stable conditions?
– Ability to adapt to changing environment
– Collective negotiations can create an adversarial
environment and impact morale
• There are limits to how much award conditions
can be changed by an EA
– NES
– Modern Award
– BOOT
• Can award conditions be changed outside an EA?
– Which is the greater burden on resources?
©Leading Age Services Australia - Victoria
Majority Support Determinations
• If more than 50% of employees want to
bargain for an EA and the employer
refuses, they can apply to the FWC for a
majority support determination
• This requires the employer to bargain in
good faith, but does not require the
employer to reach agreement
©Leading Age Services Australia - Victoria
Current bargaining claims
• Unions
– Wage increases of 4-5% pa
– Increased penalty rates
– Increased minimum engagement
– 3-4 year agreement
– Additional leave
– Extend travel allowance application
– Extend client cancellation notice period
– Roster change restrictions
©Leading Age Services Australia - Victoria
Current bargaining claims
• Employers
– 2 year agreement
– Minimum shift lengths
– Notice of shift changes
– Classification structures
– Span of working hours
– Flexible ordinary hours
– Personal leave requirements
©Leading Age Services Australia - Victoria
The enterprise bargaining process
• Fair Work Commission Draft Enterprise
Agreements Benchbook
https://www.fwc.gov.au/aboutus/consultation/draft-enterprise-agreementsbenchbook
©Leading Age Services Australia - Victoria
The enterprise bargaining process
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•
•
•
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Notice of Employee Representation Rights
Bargaining representatives
Good faith bargaining requirements
How long can bargaining take?
Role of the FWC
Voting on proposed EA
Approval process (incl BOOT)
©Leading Age Services Australia - Victoria
Summary of EA bargaining
preparation
Business Strategy &
Employer Proposals
Align EA objectives to
overall business strategy
Stakeholder analysis &
internal consultation
Negotiation
Strategy &
Employee
Communications
Identify challenges, risks
and mitigation strategies
Ensure thorough costings
& test assumptions
Negotiation Team &
Resources
Determine ‘Project’
Governance Structure
©Leading Age Services Australia - Victoria
Determine resource
requirements of
Negotiation Team &
Working Group
(preparation through to
implementation)
Industry research, trends
& contraints
Determine bargaining
approach & best
alternative to a negotiated
agreement
(BATNA)
Are external consultants
& legal required?
(don’t underestimate the
importance of EA clause
drafting and the FWC
approval process)
Brainstorm, cost and
confirm employer
proposals
Develop a
Communications Plan
& draft communication in
advance
Don’t under-resource EA
implementation
Summary of EA bargaining
preparation
• Business Strategy & Employer Proposals
– Align EA objectives to overall business
strategy
– Stakeholder analysis & internal consultation
– Industry research, trends & constraints
– Brainstorm, cost and confirm employer
proposals
©Leading Age Services Australia - Victoria
Summary of EA bargaining
preparation
• Negotiation Strategy & Employee
Communications
– Identify challenges, risks and mitigation strategies
– Ensure thorough costings& test assumptions
– Determine bargaining approach & best alternative
to a negotiated agreement (BATNA)
– Develop Communications Plan & draft
communications in advance
©Leading Age Services Australia - Victoria
Summary of EA bargaining
preparation
• Negotiation Team & Resources
– Determine ‘Project’ governance structure
– Determine resource requirements of Negotiation
Team & Working Group (preparation through to
implementation)
– Are external consultants & legal required? (don’t
underestimate the importance of EA clause
drafting and the FWC approval process)
– Don’t under-resource EA implementation
©Leading Age Services Australia - Victoria
Conclusion
• Under CDC there is no ‘best way’ to
manage your employee conditions
• The ‘most appropriate way’ will depend
upon
– Client needs
– Organisation size and funding
– Strategic plan/objectives
– Labour market and bargaining power
©Leading Age Services Australia - Victoria