By Kate Thomson, Associate Director, Australian Business Lawyers & Advisors.

For the last three years, when it comes to bargaining, the focus of employers has (fairly) been on the newer provisions of the Fair Work Act 2009 (Cth) arising from the Albanese Government’s ambitious agenda of legislative reform – think supported bargaining, multi-employer bargaining and intractable bargaining determinations. 

A feature of the legislation since the very beginning, “Majority Support Determinations” (MSDs) have sat relatively quietly, waiting for their time in the proverbial sun of the Fair Work Commission. In the past year or so, there has been a noticeable uptick of interest in bargaining generally, so it’s arguably no surprise we are seeing more MSD applications as a means to compel employers to take a seat at the bargaining table.

Many employers will never have heard of an MSD, let alone had to respond to one.  Put simply, they are a vehicle by which employees (and unions) can ask the Fair Work Commission to step in and require an employer to bargain for an enterprise agreement.  Importantly, MSDs will generally be utilised in situations where there is currently no enterprise agreement in place – if there is an old or expired EA, a simple request to start renegotiation will (usually) be all that is required to kick off the process again. 

How does this play out?  Usually, a union (though it can be a group of employees) will approach an employer and request to bargain.  The employer may start to hear rumblings of employees being asked to sign a petition.  This is usually a sign an MSD application is on its way.

This is a real decision point for the employer.  If there is a decent prospect that a majority of the employees who would be covered by the proposed agreement are prepared to put pen to paper in support of bargaining, then the employer will need to seriously consider whether they agree to start bargaining voluntarily, or to hold out.  There are plenty of advantages and disadvantages to each approach, so it’s not a decision to be taken lightly.

If the employer doesn’t agree to start bargaining, the application process for an MSD is relatively straightforward.  The employees (usually through a union) can apply to the Fair Work Commission, using evidence such as a survey to prove majority support for the commencement of bargaining.  The primary focus of the Commission is on where the numbers lie – do a majority of the impacted employees, in fact, want to commence bargaining? 

The Commission also needs to have regard to whether the employer has not agreed to bargain, whether the group of employees who will be covered by the proposed agreement is fairly chosen, and then whether it is reasonable in all circumstances to make the determination.

If the Commission is satisfied that the answer is yes on all counts, the MSD will be issued and the employer is legally required to issue a Notice of Employee Representational Rights and start good faith bargaining for an enterprise agreement.

Between all of the old and new FW Act bargaining provisions, it’s no surprise if you’re feeling a bit lost.  Now is a perfect time to review (or craft) your IR strategy. Australian Business Lawyers & Advisors are running a training course on Enterprise Bargaining, led by Nigel Ward who was the first advocate to put the new laws of multi-employer bargaining to test. If bargaining is on your radar, this course will prepare you for a productive negotiation.