The ALP has made no secret of its desire to abolish AWAs. A priority of its new term of government is the gradual phasing out of AWAs, such that 31 December 2012 will be the last possible expiry date for all AWAs.

Julia Gillard has indicated today that the ALP is currently in discussions regarding new workplace relations laws to be implemented “as quickly as humanly possible”. Realistically, this cannot occur until a transitional bill is passed by both houses of parliament in the new year.

Existing AWAs

All existing workplace agreements can continue to operate for their full term. Employers will have up to five years to make suitable alternative workplace arrangements for those employees on AWAs.

Transitional Arrangements

Although the ALP will ultimately abolish AWAs, new transitional arrangements will be introduced to manage this process. A new form of individual agreement, Individual Transitional Employment Agreements (ITEAs) may be made during a 2 year period of transition. These ITEAs may be made between:

an employer who has any employee engaged on an AWA as at 1 December 2007; and
a new or an existing employee whose terms and conditions are governed by an AWA.

ITEAs can have a nominal expiry date of no later than 31 December 2009. The ITEA must not disadvantage the employee when compared to an applicable collective agreement or, where there is no collective agreement, the applicable award and the Fair Pay and Conditions Standard, that would apply but for the ITEA.

Brief Case Study

You have a new employee starting on 2 December 2007 and you wish to engage him under an AWA which you have previously used for all employees. Is it possible to do this under the new Labor government?

Yes it is. AWAs lodged before the implementation of the transition bill will continue to operate for their full term, of up to 5 years. After the transitional bill is passed, new two-year individual agreements, called Individual Transitional Employment Agreements (ITEAs), can be made for a new employee with a nominal expiry date of no later than 31 December 2009.

Although the abolition of AWAs will not be effected immediately by the new Government in view of the transitional arrangements employers need to be prepared for the limited lifespan of AWAs. This may mean initiating a workplace agreement strategy that will allow employees to transition into a workplace relations landscape without AWAs.

It is critical that employers take a proactive approach to the imminent changes, in order to minimise disturbance to the running of their business. For further information and advice on how your business can be better prepared, call a partner at Fisher Cartwright Berriman on (02) 9922 5188.

FCB – Solutions at Work
If you would like to know more about this announcement, please contact a Partner in Sydney (02) 9922 5188 or Melbourne (03) 9614 3900.
Fisher Cartwright Berriman Pty Limited

ACN: 125 440 824
Workplace Relations Law Specialists
www.fishcart.com