Inside IR (Australian Industrial Relations) EP25: Clear and unambiguous enterprise agreements – A pipe dream, or a necessity?

Given the recent commencement of criminal wage thefts laws, increase in the maximum civil penalties that can be awarded for wage non-compliance, and focus of the Fair Work Ombudsman on prosecuting wage non-compliance, it is more important than ever to get wage compliance right. But there is a feature of our industrial relations system that can sometimes make achieving compliance a rather difficult exercise…. We are of course talking about long, complex and ambiguous enterprise agreements.Many employers are saddled with enterprise agreements that are, at best, confusing, and at worst, internally inconsistent. They are a product of decades of enterprise bargaining – where words that were crafted 30 or so years ago have either been left as they were and considered too difficult to modernise, or been added to over time resulting in an unwieldly hodgepodge of obligations, entitlements, exceptions, and conditions. The cost and risk to business of managing compliance with these types of instruments is significant yet attempts to modernise terms during enterprise bargaining processes are often met with resistance.In our latest episode of our market-leading industrial relations podcast Inside IR, Partner Rohan Doyle and Senior Associate Mitchell Brennan grapple with this problem and explore potential solutions. Rohan and Mitchell:provide a refresher on the potential consequences of long, complex, and ambiguous enterprise agreements, including in light of recent IR reform;reflect on the reasons as to why some enterprise agreements have become a source of a significant non-compliance risk, and compliance cost, for some employers; and explore various paths that employers can take – both inside and outside of bargaining – to achieve clearer terms and conditions that are easier and more cost effective to comply with.