Application of an enterprise agreement

See Fair Work Act 2009 s.52

An enterprise agreement covers an employee if it is expressed to do so.[1]

Many enterprise agreements contain a coverage clause that specifies the parties who are bound by that instrument.

An enterprise agreement applies to an employee if:

• the agreement is in operation
• the agreement covers the employee, and
• no provision of the Fair Work Act provides or has the effect that the agreement does not apply to the person.

See Fair Work Act s.51

The effect of an agreement applying to a person is that it confers entitlements and imposes obligations on them.

A provision of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) extends the reference of ‘enterprise agreement’ in section 382 of the Fair Work Act to include an agreement-based transitional instrument.[2]

An individual agreement such as an Australian Workplace Agreement (AWA) or Individual Transitional Enterprise Agreement (ITEA) is an agreement-based transitional instrument.[3]

Enterprise agreement applies

Employee under Australian Workplace Agreement

Coventry v Southern Gulf Catchments Ltd [2011] FWA 7018 (Smith C, 19 October 2011).

The employee’s income exceeded the high income threshold and the employee was covered by an Australian Workplace Agreement (AWA).

The Fair Work Commission found that the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 defined ‘enterprise agreement’ as including agreement-based transitional instruments. As an AWA is an agreement-based transitional instrument, the employee was protected from unfair dismissal.

Enterprise agreement does NOT apply

Employee did not fall under enterprise agreement classifications

Taylor-Hunt v Downer EDI Works Pty Ltd [2010] FWA 4626 (Hampton C, 5 July 2010).

The employee argued that he was covered by an enterprise agreement which applied to employees 'employed in classifications contained in the enterprise agreement ... on road construction and maintenance civil construction'.

It was held by that although the employee did work in connection with road construction and maintenance, he did not fall within any of the classifications of the agreement, and was therefore not covered.