The changes to enterprise bargaining introduced under the Fair
Work Act 2009(Cth) (FW Act) have enabled groups of
employers, such as franchisees, to bargain for one overarching
single-enterprise agreement, where Fair Work Australia
(FWA) authorises them to do so.
The FW Act has replaced the previously available
"union" and "non-union" enterprise agreements
with two types of enterprise agreements; single-enterprise and
multiple-enterprise agreements. This presents employers such as
franchisees with the option to move into the multi enterprise
agreement stream or remain in the single-enterprise stream.
A single enterprise agreement is an agreement made between a
single employer and some or all of their employees. This is the
most common form of enterprise bargaining and there is no
requirement to seek authorisation or to notify FWA that the parties
wish to bargain for such an agreement.
Single-interest employer authorisation
The FW Act has introduced into the single-enterprise stream the
concept of single-interest employers. These are employers who
operate in a related way or share such a common interest that they
may bargain together for a single-enterprise agreement (i.e.
franchisees). Employers may bargain as a single-interest employer
where FWA has authorised them to do so by granting those employers
an Single Interest Employer Authorisation
The consequences of a group of employers being brought into the
single enterprise stream by an SIEA include:
the employers will be able to bring a range of franchisees in
various locations under one single enterprise agreement
employees can take protected industrial action
the vote required for approval is the majority of all employees
who vote (not a majority of the employees of each
unions are prevented from obtaining scope orders against
However, unions and or employees are not prevented from seeking
Majority Support Determinations and Bargaining Orders or Serious
Breach Declarations against an employer.
FWA must make an SIEA on application by a group of employers
where it is satisfied that those employers to be covered by the
agreement have agreed without coercion or threat to bargain
together and either:
the employers carry on business under the same franchise system
and are franchisees of the same franchisor or related bodies
corporate of the same franchisor, or
the employers have been granted a Ministerial Declaration that
they may bargain together.
A recent SIEA example: KFC
On 19 October 2009 FWA granted its first SIEA under section 249
of the FW Act in favour of Yum! Restaurants Australia Pty Ltd, the
owner of the KFC franchise.
This SIEA decision enables the KFC franchisees to bargain
together for a single-enterprise agreement with their
The SIEA means that any enterprise agreement struck by the KFC
franchisees and their employees will operate in respect of all
restaurant workers, commissaries and home-delivery call centre
employees employed across almost 50 KFC outlets.
The Domino's experience
Franchisees should note that it is vitally important to ensure
that the form and content of an SIEA application is correct.
In a recent decision of FWA involving an SIEA application by
Domino's Pizza Enterprises Limited
(Domino's) FWA required Domino's to
provide amended application documents to:
properly identify the name of the franchisee
include a complete copy of the authorisation form
state the name of the authorised representative of the
include the title of the authorised representative of the
franchisee in compliance with the FW Act.
Following this amendment to the SIEA application materials, FWA
found that the preconditions under the FW Act had been met, and
accordingly, the SIEA could be granted to Domino's.
Important considerations for franchisees and common interest
Franchisees and Franchisors who wish to bargain together to
establish common terms and conditions of employment throughout the
franchise business should consider whether an SIEA would assist
them in the bargaining process.
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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Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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