Enterprise bargaining agreement

Enterprise bargaining is wage and working conditions being negotiated at the level of the individual organisations. Once established, they are legally binding on employers and employees. An Enterprise Bargaining Agreement (EBA) consists of a collective industrial agreement between either an employer and a trade union acting on behalf of employees or an employer and employees acting for themselves.

On the one hand collective agreements, at least in principle, benefit employers, as they allow for improved "flexibility" in such areas as ordinary hours, flat rates of hourly pay, and performance-related conditions. On the other hand collective agreements benefit workers, as they usually provide higher pay, bonuses, additional leave and enhanced entitlements (such as redundancy pay) than an award does.

EBAs in Australia

Unlike awards, which provide similar standards for all workers in the entire industry covered by a specific award, collective agreements usually apply only to workers for one employer - although on occasion a short-term collaborative agreement (for example, on a building-site) yields a multi-employer/employee agreement.

Parties endorse proposed enterprise bargaining agreements between themselves (in the case of employers the matter goes to a vote). The Australian Industrial Relations Commission then certifies them. (With the introduction of WorkChoices, agreements now renamed "collective workplace agreements" are lodged with the Workplace Authority and are checked for breaches of the Act.)

History of enterprise bargaining agreements

Enterprise Bargaining Agreements were first introduced in Australia under the Prices and Incomes Accord in 1991 (Mark VII). They later became the centrepiece of the Australian industrial relations system when the Accord was next revised in 1993 (Mark VIII). This ended nearly a century of centralised wage-fixing based industrial relations.

Use of enterprise bargaining agreements

Enterprise agreements have proved quite popular; on 30th of June 2006, 14383 Collective Agreements were active. June Trends in Enterprise Bargaining

In practice they served to complement awards, and in combination they became the basic mechanisms for setting wages and conditions in Australia.

A standard enterprise bargaining agreement would last for three years.

EBAs had one unique feature in Australia: whilst negotiating a federal enterprise bargaining agreement, a group of employees or a trade union could, without legal penalties, undertake industrial action (including strikes) in pursuit of their claims .

Issues regarding enterprise bargaining agreements

A major legal question associated with enterprise agreements stemmed from the High Court of Australia's decision in the case of Electrolux v The Australian Workers' Union. The question revolved around what these industrial instruments could cover. The Australian Industrial Relations Commission determined the matter in 2005 in the Three certified agreements case.

The future of EBAs in Australian industrial law

In the context of Australian labour law, the industrial reform of 2005 - 2006, known as "WorkChoices" (with its corresponding amendments to the Workplace Relations Act (1996)) changed the name of such agreement documents to "Collective Agreement". State industrial legislation can also prescribe collective agreements, but the enactment of the WorkChoices reform will make such agreements less likely to occur.

since the Fair Work Act was enacted, parties to Australian federal collective agreements now lodge their agreements with Fair Work Australia for approval. Before an enterprise agreement will be approved a member of the tribunal must be satisfied that employees employed under the agreement will be 'Better Off Overall' than if they were employed under the relevant modern award.