Enterprise Agreement Bargaining and the new Intractable Bargaining Declaration Provisions

The new intractable bargaining dispute regime is playing out in a manner not overly conducive to employers.

What is the Intractable Bargaining Regime (IBD)

When employees and employers can’t agree on the terms of an enterprise agreements (EA), this new regime introduced last year can be brought into play by either party.

The objective is to “help” employees and employers resolve disputes related to bargaining over the terms of their EA if they couldn’t reach agreement, by allowing the Fair Work Commission to come in, arbitrate and make binding declarations.

The Fair Work Commission is limited in its application of the IBD regime to ensure that no condition is worse off than what was in the preceding agreement. This change has given Unions the upper hand. What are we seeing in this domain

Unions are now incentivised to:

• Drag on bargaining

• Take employers to the Commission

In the short time that this regime has been in place, we’ve seen a number of cases where the FWC are making orders in line with pay increases sought by the unions. Looking at the recent TWU v Cleanaway Operations [2024] FWCFB 287 Case.

• In this case, Cleanaway’s 2020 agreement expired in September 2022.

• The union took Cleanaway to the Commission.

• The Commission awarded a 23 per cent pay rise to employees.

• Well above Cleanaway’s proposed 11 per cent pay increase.

• And a little under the TWU’s requested 24 per cent increase.

Lessons for Employers

Employers must set up a robust EA negation process to ensure the new provisions in the FWA are adopted during negotiations.

Number one lesson don’t make concessions on a piecemeal basis as the Commission will accept these agreements as given.