Right through to the end of 2013, many unions and a number of employers applied to the Fair Work Commission (FWC) for a modern enterprise award. Where such an application is successful, a modern enterprise award would cover employees rather than one of the 122 industry or occupational modern awards that the FWC made between 2008 and 2010.
The applicable legislation required any application for a modern enterprise award to be made prior to 31 December 2013. Where no application was made the enterprise award automatically terminated.
The FWC has now received 169 applications for a modern enterprise award, with only a handful of applications (those that were made early) having been heard.
The FWC has now released a timetable that requires all Applicants and Respondents to confer about the terms of a draft modern enterprise award; Applicants to file and serve their evidence and proposed draft award by no later than 5pm on 14 March 2014; and any material opposing any application to go in no later than 5pm on 14 April 2014. The Full Bench will then review this material and list the matters for hearing.
Why does this process matter?
Any modern enterprise award made will set the terms and conditions of award reliant employees, and form the reference instrument for the “better off overall test” when any enterprise agreement covering the same employees is made and approved. Modern awards (whether having enterprise, industry or occupational coverage) are likely to have a long life under our system.
Now is the time for employers affected by this process to finalise their approach and strategy.
This will involve consideration of a number of factors including:
- the merits of any application to modernise an enterprise award and the terms and conditions of employment that will be contained in the award
- how an enterprise award will be different from the industry or occupational modern award that would otherwise cover employees, and how those differences can be justified having regard to the history of the enterprise award, the unique features of the enterprise which the award covers, and other relevant factors
- any competitive advantage or disadvantage that might be achieved (or guarded against where competitors may end up with their own modern enterprise award).