Permitted matters

See Fair Work Act 2009 s.172(1)

The Fair Work Act sets out matters which are permitted to be included in an enterprise agreement.

A term of an enterprise agreement has no effect to the extent that it is not a term about a permitted matter.[1] However, the inclusion of such a term in an enterprise agreement does not prevent the Fair Work Commission from approving the agreement as an enterprise agreement.[2]

The following matters are permitted matters:

• matters pertaining to the employer–employee relationship
• matters pertaining to the employer–union relationship
• terms about deductions from wages, and
• terms about how the agreement will operate.

An enterprise agreement may contain terms about matters pertaining to the relationship between an employer and the employees who will be covered by the enterprise agreement.

For example, terms relating to:

• wages and allowances, hours of work and shift patterns
• leave and leave arrangements
• staffing levels (particularly if aimed at ensuring health and safety of employees), and
• the employment of casual employees and casual conversion provisions.

Whether a particular clause in an enterprise agreement pertains to the relationship depends upon the form of the clause, its content and effect, the precise construction and circumstances surrounding the particular employment relationship.[3]

An enterprise agreement may contain terms about matters pertaining to the relationship between the employer or employers, and union or unions that will be covered by the enterprise agreement.

For example, terms:

• about union training leave and leave for training conducted by a union (such as work health and safety training)
• that provide for employees to have paid time off to attend union meetings or participate in union activities, and
• that provide for union involvement in dispute settlement procedures.[4]

For an enterprise agreement term to pertain to the relationship between the employer and union, the term needs to relate to the union's legitimate role in representing the industrial interests of the employees to be covered by the enterprise agreement.[5]

An enterprise agreement may contain terms about deductions from wages for any purpose authorised by an employee who will be covered by the enterprise agreement.

Deduction terms will not have effect if:

• they benefit the employer and they are unreasonable in the circumstances, or
• if the employee is under 18 years – without a parent, or guardian's agreement.[6]

An enterprise agreement may contain terms about how it is intended to operate.

For example:

• terms setting out how and when the negotiations for a replacement enterprise agreement will be conducted or
• terms specifying who the enterprise agreement will cover.[7]