Enterprise Bargaining is Broken


The rules around enterprise bargaining are too restrictive and bosses have found ways to exploit them. They use tactics such as outsourcing, offshoring, labour hire, terminating agreements, no stake agreements, and more, to avoid paying fair wages and conditions. Bosses have an unfair advantage over workers.

The Issue

The enterprise bargaining system was intended to provide workers with fair wages and conditions in exchange for business improving productivity.

While companies have enjoyed increased productivity, they’ve failed to share those benefits with workers. They’ve just lined their pockets. Profits have soared, wages have not.

Big business has too much power and working people are paying the price.

Enterprise agreement rates were supposed to replace award rates. Award rates have stagnated and now there is a large gap between award agreement rates of pay.

Workers are being forced off agreements and back onto the basic award. Since 2009 the number of Enterprise Agreements has dropped by 31 per cent, and there has been a 13 per cent drop in the number of workers covered by agreements, according to the Workplace Agreements Database maintained by the Department of Employment.

Companies are now seeking new ways of reducing wages and conditions.

They do this in a number of ways, such as:

• Undermining the nature of the employment relationship by exchanging employees for independent contractors.
• Engaging labour hire companies instead of hiring staff directly.

These practices undermine employment relationships and avoid existing agreement terms and conditions.

Other companies use the existing rules to reduce wages and conditions during bargaining by:

• Refusing to offer any pay rise unless other terms and conditions are traded off.

• Stalling bargaining for long periods to effectively freeze wages.

• Threatening to terminate existing agreements and dropping wages to award rates if employees do not vote up a proposal that otherwise cuts terms and conditions.

The enterprise bargaining system was supposed to provide workers access to better pay and conditions.

The best way to stand up for workers’ rights is to join your union and change the rules.