Changes to Enterprise Agreements: What employers should know!
The Fair Work Commission (FWC) has announced key changes to the model terms for enterprise agreements (EAs), taking effect on 26 February 2025.
Understanding these updates is vital for both employers and employees involved in enterprise bargaining.
What is an enterprise agreement?
Enterprise agreements are negotiated contracts between employers and employees (usually via unions) that set minimum employment terms and conditions for a particular business or group of businesses.
These agreements operate alongside the National Employment Standards (NES) and relevant Modern Awards but can tailor terms to suit a specific workplace.
What are model terms in enterprise agreements?
The FWC mandates model terms which are specific clauses that must appear in every enterprise agreement. These include provisions on dispute resolution, flexibility arrangements, and consultation requirements.
What are the changes?
The FWC must make changes to the model terms in enterprise agreements, under the Closing Loopholes No. 2 Act.
The new model terms are as follows:
Flexibility model term
Employees and employers have an improved (and clearer) process to agree on flexible working arrangements, such as changes to hours or patterns of work.
Consultation model term
Changes reinforce employers’ obligations to engage meaningfully with affected employees about changes to major workplace matters, ensuring genuine consultation and communication.
Dispute model term
The revised dispute resolution model term strengthens the process for addressing workplace disagreements. It now includes more detail about procedural requirements, an emphasis on cooperation, and clearer escalation steps if disputes arise.
What should employers do now?
Employers negotiating or planning to negotiate enterprise agreements should:
- Review the new model terms and update your enterprise agreements to demonstrate the changes.
- Get legal advice to make sure your enterprise agreements comply with the new FWC changes.
Contact our Aintree Group Legal team today for individual advice.
This is general advice only and has not been prepared with your situation and needs in mind. For individual and personalised advice, we highly recommend that you seek out proper professional advice from your lawyer.
