Tip 2 - When the operating contract expires, you take active steps to reduce the risk of termination Council 3 - If there is a "zombie agreement," seek legal advice on whether the BOOT test is still successful in practice, these agreements may continue to govern the general conditions of workers, since Section 59 of the Fair Work Act 2009 (Cth) does not apply to a staff member. if an enterprise agreement is in effect (i.e. there is no "double" coverage). A corporate agreement will have full legal value even after its nominal expiry date, although its rates of pay are covered by the mark-up rates. The nominal expiry date is only a "trigger" for other measures such as the opening of negotiations by a union party or requests for bargaining orders (which require an employer to negotiate in good faith). For example, if an enterprise contract was approved in 2008 for a four-year term and expired in 2012, a worker employed in 2017, who is covered by the expired contract, will continue to be paid at the rates provided for in the expired agreement. These so-called "zombie" enterprise agreements may have passed the Better Off Overall Test (BOOT) (which is conducted when the Fair Work Commission assesses whether an enterprise agreement is approved or not), but may not be more advantageous than the underlying reward. As lawyers for employers, we help employers in "zombie agreements" and we have extensive experience that helps clients reduce legal risks and liability. If you need help, please contact us to agree on a non-binding advice on 61 (07) 3876 5111 and subscribe to our newsletter The NoniB Case and the Merivale Group show this point where the Fair Work Commission has ordered the termination of the agreements in place since 2011 and 2007 respectively. Companies were therefore required to update and organize their wage settlement procedures without delay to ensure that their staff now receive at least the minimum rates prescribed in the respective price, thus causing negative publicity to organizations. Zombie Enterprise agreements are industrial instruments that have passed their nominal expiration date, but have not been terminated or replaced by another agreement.
If you have a zombie deal that still applies to your workplace, it`s time to review your payment terms and get advice on the best way to proceed. Proactive steps to get out of a past agreement avoid the need for employers to make a sudden transition. An enterprise agreement sets its expiry date (we propose to dipolarize this date), although negotiations with the unions may take place before the expiry. Tip 1: Check the wage agreements of your enterprise agreements If an employer, employee or union files an application to terminate an expired contract on behalf of workers and the Fair Work Commission then terminates the contract, the employer is required to pay its employees (at least from the date of termination of the expired contract) the modern rate of mark-up in effect. This often requires a thorough review and update of an employer`s workers` compensation. While an employer may legally have the right to pay its employees under zombie agreements and, on the one hand, may seem economically sound by placing the company in a seemingly indecent competitive position, this short-term view is not liable for the considerable damage to the reputation of such agreements when it is established that an employer is recovering from it. It can lead to tighter control of employee unions in the future and an employer`s inability to bear higher costs (due to sudden changes in wage rates).