Varying by agreement

See Fair Work Act 2009 s.207

If an agreement covers a single employer:

• the employer
• the employees employed at the time who are covered by the agreement, and
• the employees employed at the time who will be covered by the agreement if the variation is approved;

may jointly make a variation of the enterprise agreement.

If an agreement covers two or more employers:

• ALL of those employers
• the employees employed at the time who are covered by the agreement, and
• the employees employed at the time who will be covered by the agreement if the variation is approved;

may jointly agree to make a variation of an enterprise agreement.

A variation of an enterprise agreement has no effect unless it is approved by the Fair Work Commission.

Limitation – greenfields agreement

A greenfields agreement can only be varied by agreement if one or more of the persons who will be necessary for the normal conduct of the enterprise concerned, and are covered by the agreement, have been employed.

See Fair Work Act s.208

An employer covered by an enterprise agreement may request the affected employees for a proposed variation of the agreement to approve the proposed variation by voting for it.

A no extra claims provision in an enterprise agreement cannot operate to deprive the employer of the capacity to request employee approval of a variation to that enterprise agreement.[1]

The employer may request that the employees vote by ballot, by an electronic method or by some other method.

Related information

• Access period
• Better off overall test (BOOT)
• Voting methods

See Fair Work Act s.209

Single-enterprise agreement

If the affected employees of an employer, or each employer, covered by a single-enterprise agreement have been asked to approve a proposed variation, the variation is made when a majority of the affected employees who cast a valid vote approve the variation.

Multi-enterprise agreement

If the affected employees of each employer covered by a multi-enterprise agreement have been asked to approve a proposed variation, the variation is made when a majority of the affected employees of each individual employer who cast a valid vote have approved the variation.

See Fair Work Act s.210

Application for approval

If a variation of an enterprise agreement has been made, a person covered by the agreement must apply to the Commission for approval of the variation. An application for approval of variation of an enterprise agreement must be made with a Form F23.

Material to accompany the application

An application for approval of variation of an enterprise agreement made to the Commission must include the following documentation:

• a signed copy of the variation
• a copy of the agreement as proposed to be varied
• a completed and signed declaration from each employer [Form F23A], and
• a completed and signed declaration from each union (if covered) [Form F23B].[2]

The declaration must be completed truthfully.

It is an offence to knowingly give information that is false or misleading or which omits any matter or thing without which the information is misleading, or to knowingly produce a false or misleading document, in support of an application for approval of a variation to an enterprise agreement, the punishment for which is imprisonment for up to 12 months – see s.137.1 and s.137.2 of the Criminal Code.

Links to forms

• Form F23 – Application for variation of an enterprise agreement by agreement
• Form F23A – Employer statutory declaration in support of variation of an enterprise agreement
• Form F23B – Union statutory declaration in support of variation of an enterprise agreement

All forms are available on the Forms page of the Commission's website.

When the application must be made

The application must be made:

• within 14 days after the variation is made, or
• if in all the circumstances the Commission considers it fair to extend that period – within such further period as the Commission allows.

Signature requirements

See Fair Work Act s.210(4) & reg 2.09A

A signed copy of a variation must be signed by the employer and at least one representative of the employees covered by the agreement as varied.

Generally the signature of a representative of employees does not bind the representative to the agreement as varied; unless the representative is an employee who will be bound by the agreement as varied.

While it is necessary to have at least one representative of the employees sign the variation, it is not necessary for every bargaining representative to sign the variation.

Requirements of regulation 2.09A

For the purposes of reg 2.09A(2)(b)(i) – which requires 'the full name and address of each person who signs the variation' a person can use his or her work address, and does not have to provide home address details.[3]

Note: Due to the complexities involved with the cross-referencing within section 211 of the Fair Work Act, the section is presented as a direct quote.

'211 When the FWC must approve a variation of an enterprise agreement

Approval of variation by the FWC

1. If an application for the approval of a variation of an enterprise agreement is made under section 210, the FWC must approve the variation if:
   1.  the FWC is satisfied that had an application been made under subsection 182(4) or section 185 for the approval of the agreement as proposed to be varied, the FWC would have been required to approve the agreement under section 186; and
   2. the FWC is satisfied that the agreement as proposed to be varied would not specify a date as its nominal expiry date which is more than 4 years after the day on which the FWC approved the agreement;

unless the FWC is satisfied that there are serious public interest grounds for not approving the variation.

Note: The FWC may approve a variation under this section with undertakings (see section 212).

Modification of approval requirements

2. For the purposes of the FWC deciding whether it is satisfied of the matter referred to in paragraph (1)(a), the FWC must:
   1. take into account subsections (3) and (4) and any regulations made for the purposes of subsection (6); and
   2.  comply with subsection (5); and
   3. disregard sections 190 and 191 (which deal with the approval of enterprise agreements with undertakings).
3. The following provisions:
   1. section 180 (which deals with pre-approval steps);
   2. subsection 186(2) (which deals with the FWC's approval of enterprise agreements);
   3. section 188 (which deals with genuine agreement);
      have effect as if:
   4. references in sections 180 and 188 to the proposed enterprise agreement, or the enterprise agreement, were references to the proposed variation, or the variation, of the enterprise agreement (as the case may be); and
   5. references in those provisions to the employees employed at the time who will be covered by the proposed enterprise agreement, or the employees covered by the enterprise agreement, were references to the affected employees for the variation; and
   6. references in section 180 to subsection 181(1) were references to subsection 208(1); and
   7. the words "if the agreement is not a greenfields agreement—" in paragraph 186(2)(a) were omitted; and
   8. paragraph 186(2)(b) were omitted; and
      1. references in paragraphs 186(2)(c) and (d) to the agreement were references to the enterprise agreement as proposed to be varied; and
      2. subparagraph 188(a)(ii) were omitted; and
   9. the words "182(1) or (2)" in paragraph 188(b) were omitted and the words "209(1) or (2)" were substituted.
4. Section 193 (which deals with passing the better off overall test) has effect as if:
   1. the words "that is not a greenfields agreement" in subsection (1) were omitted; and
   2. subsection (3) were omitted; and
   3. the words "the agreement" in subsection (6) were omitted and the words "the variation of the enterprise agreement" were substituted; and
   4. the reference in subsection (6) to subsection 182(4) or section 185 were a reference to section 210.
5. For the purposes of determining whether an enterprise agreement as proposed to be varied passes the better off overall test, the FWC must disregard any individual flexibility arrangement that has been agreed to by an award covered employee and his or her employer under the flexibility term in the agreement.

Regulations may prescribe additional modifications

6. The regulations may provide that, for the purposes of the FWC deciding whether it is satisfied of the matter referred to in paragraph (1)(a), specified provisions of this Part have effect with such modifications as are prescribed by the regulations.'

Related information

• Better off overall test (BOOT)
• Undertakings

See Fair Work Act s.212

Approval of agreement with undertakings

If an application for the approval of a variation of an enterprise agreement has been made and the Commission has a concern that the variation does not meet the requirements for approval of a variation set out in the Fair Work Act.

The Commission may approve the variation if satisfied that an undertaking accepted by the Commission meets the concern.

Undertakings

The Commission may only accept a written undertaking from one or more employers covered by the agreement if satisfied that the effect of accepting the undertaking is not likely to:

• cause financial detriment to any affected employee for the variation, or
• result in substantial changes to the variation.

Related information

• Financial detriment
• Substantial change

Signature requirements

See Fair Work Act s.212(4) & reg 2.10

An undertaking relating to the variation of an enterprise agreement must be signed by each employer who gives the undertaking.

Effect of undertakings

See Fair Work Act s.213

Single employer

If the Commission approves a variation of an enterprise agreement after accepting an undertaking in relation to the variation and the agreement covers a single employer, the undertaking is taken to be a term of the agreement as the agreement applies to the employer.

Two or more employers

If the Commission approves a variation of an enterprise agreement after accepting an undertaking in relation to the variation and the agreement covers two or more employers, the undertaking is taken to be a term of the agreement as the agreement applies to each employer that gave the undertaking.

See Fair Work Act s.214

Approval of a variation of an enterprise agreement may be refused if compliance with the terms of the agreement as proposed to be varied may result in a person committing an offence against a Commonwealth law or a person being liable to pay a pecuniary penalty in relation to the contravention of a Commonwealth law.

If approval is refused on this basis, the Commission may refer the agreement to any person or body considered appropriate.

See Fair Work Act s.215

If the Commission approves a variation of an enterprise agreement after accepting an undertaking in relation to the variation, the Commission must note in its decision to approve the variation that the undertaking is taken to be a term of the agreement.

See Fair Work Act s.216

If a variation of an enterprise agreement is approved, the variation operates from the day specified in the decision to approve the variation.