Under the new Fair Work Act, the Government has
introduced significant changes to the framework for collective
"Good faith bargaining" is an integral part of these
The concept is designed to redress an apparent imbalance between
the rights of employers and employees under the previous
legislation, and to lessen the likelihood of industrial action in
the event of stalled negotiations.
The Act regulates the process by advising employees of their
right to be represented at the commencement of bargaining.
In addition, pursuant to s.228 of the Act (yet to commence),
bargaining representatives must meet the good faith bargaining
Attending, and participating in, meetings at reasonable
Disclosing relevant information (other than confidential or
commercially sensitive information) in a timely manner;
Responding to proposals made by other bargaining
representatives for the agreement in a timely manner;
Giving genuine consideration to the proposals of other
bargaining representatives for the agreement, and giving reasons
for the bargaining representative's responses to those
Refraining from capricious or unfair conduct that undermines
freedom of association or collective bargaining.
Fair Work Australia (the Government "one stop shop"
regulator) will have the power to test support among employees and
if it determines that a majority of the employees want to bargain
collectively, their employer will be required to bargain with
Further, if it is determined that bargaining representatives are
not effectively bargaining together, Fair Work Australia will have
the power to issue orders which require representatives to bargain
in good faith. Orders will deal with procedural matters, rather
than the content of agreements.
Before seeking orders of this kind, an aggrieved party must
notify the other party of their concerns.
The regulator will not be empowered to make orders until 90 days
before the nominal expiry date of an existing collective agreement
if the employer has not offered employees a new agreement.
There is some confusion regarding the ability of the regulator
to compulsorily determine an agreement. The parties' options,
where agreement cannot be reached are, apparently, to:
Walk away from negotiations;
Jointly request Fair Work Australia assist the parties reach
In certain circumstances, take protected industrial
However, it also appears that compulsory arbitration has
returned in the form of bargaining related workplace
determinations. They key pre-requisite is said to be a serious
breach declaration by Fair Work Australia in relation to a proposed
enterprise (collective) agreement.
A serious breach declaration can be made "when a bargaining
representative has contravened a bargaining order and the
contravention is serious and sustained and has significantly
undermined bargaining for the agreement."
Fair Work Australia can make a bargaining related workplace
determination as quickly as possible after the end of the
post-declaration negotiating period if a serious breach declaration
has been made and the bargaining representatives have not settled
all of the matters in issue. In order to make such a determination,
the consent of the parties is not required.
A workplace determination is, in effect, an enterprise
agreement, meaning that, under defined conditions a form of
compulsory industrial arbitration has returned to Australian
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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