Australian Workplace Agreement

Australian Workplace Agreement

An Australian Workplace Agreement (AWA) was an individual written agreement on terms and conditions of employment between an employer and employee in Australia, under the "Workplace Relations Act 1996". An AWA can override employment conditions in state or territory laws except for occupational health and safety, workers’ compensation or training arrangements. An AWA must meet the minimal Australian Fair Pay and Conditions Standard. Agreements must include a dispute resolution procedure, and may not include prohibited content. Agreements are for a maximum of five years; approved, promoted and registered by the Workplace Authority; operate to the exclusion of any award; and prohibit industrial action regarding details in the agreement for the life of the agreement. The introduction of Australian Workplace Agreements is a controversial industrial relations issue in Australia.


AWAs had achieved coverage of about 2.4 % of the workforce as of May 2004 [ Employee Earnings and Hours, Australia, May 2004] : Australian Bureau of Statistics] . Mining companies have pushed the agreements with some success, offering substantial increases in pay to workers who chose to sign an AWA.

According to OEA statistics, as at December 31, 2004, 1,410,900 persons were covered under Union Certified Agreements, 168,500 were covered under non-union Certified Agreements, and Australian Workplace Agreements had risen to 421,800, or over 21%. By 31 December 2005 this had risen to 1,618,200 under Union Certified Agreements, 185,300 under non-union Certified Agreements, and 538,200 Australian Workplace Agreements [ Certified agreement and Australian workplace agreement coverage] from estimates and statistics collated by Office of the Employment Advocate, Accessed 12 June, 2006] . "Australian Bureau of Statistics" figures for March 2005 show that hourly wages of workers on AWAs were two percent lower than the hourly wages of workers on registered collective agreements, mostly negotiated by unions. [ The impact on Workers of Australian Workplace Agreements] by Professor David Peetz, June 2005. ABS Statistics show a two percent disparity in wages between AWAs and collective agreements - Page 11.] For women, AWAs paid 11 % less per hour than collective agreements. [ The impact on Workers of Australian Workplace Agreements] by Professor David Peetz, June 2005. Women's earnings 11% less under AWAs on Page 11.]

"The most common methods of setting pay for all employees were registered collective agreement (38.3%), unregistered individual arrangement (31.2%) and award only (20.0%). Unregistered collective agreement (2.6%) and registered individual agreement (2.4%) were the least common methods of setting pay. The remaining 5.4% of employees were working proprietors of incorporated businesses."

In the federal public service the Department of Employment and Workplace Relations reported that as of December 31, 2004, out of 124,500 public and parliamentary service permanent staff there were 11,085 AWAs (covering 1928 Senior Executive Service (SES), where AWAs are compulsory, and 9,157 other employees). [ DEWR statistics on AWAs in the Federal Public Service] from "Union gets ready for hostile Senate" by Verona Burgess, Australian Financial Review, 8 April 2005, as published in CPSU bulletin April 2005] The rest of the permanent staff were covered, as at March 30, 2005, by 101 certified agreements, of which 70 were union enterprise agreements and 31 non-union enterprise agreements. [ Percentage of Union and Non-union Certified Agreements in the Federal Public Service] from "Union gets ready for hostile Senate" by Verona Burgess, Australian Financial Review, 8 April 2005, as published in CPSU bulletin April 2005]

According to a report in The Australian newspaper in March 2007, about five per cent of the total workforce is employed on AWAs, with about 32 per cent of miners employed on AWAs, but this figure is much higher in Western Australia where up to 52 per cent are on AWAs. Rio Tinto pioneered individual employment contacts under common law in the 1980s in Western Australia with productivity improvements of between 20 and 35 per cent, according to Rio Tinto managing director Charlie Lenegan. ["Employers Defend Howard’s AWAs Despite Slow Take-Up" by Brad Norington & Andrew Trounson, The Australian, 31 March 2007, p. 33. [] ]

Opposing views

The view of the union movement is that AWAs are an attempt to undermine the collective bargaining power of trade unions in the negotiation of pay and conditions of their members. Unions argue that the ordinary working person has little to no bargaining power by themselves to effectively negotiate an agreement with an employer, hence there is inherently unequal bargaining power for the contract. For exceptional individuals in a workplace, or industries with a labor shortage, the union movement argues that common law contracts are sufficient. They also believe that while commercial law and common law provides for fairness and equality of bargaining power, AWAs are designed to entrench inequality between an employer and their workforce with regard to pay and conditions. The policy of the ACTU is that AWAs should be abolished and that the bargaining system should contain collective bargaining rights. [ ACTU policy on abolishing AWAs] : ACTU Congress, Melbourne, 2003]

Most unions warn their members to be very cautious about signing AWAs, and if they do so, to appoint the union as their "bargaining agent". For example, the Australian Services Union warns members:

"AWAs are about one thing: tipping the balance of power more firmly towards your employer and away from you." [ Australian Services Union] Accessed May 2005]

In the Western Australian Parliament in May 2005, the Labor Minister for Consumer and Employment Protection stated his belief that Australian Workplace Agreements are to be used to reduce wages and conditions of employment in Western Australia. [ Question on AWAs reducing wages in WA] directed to Mr J.C. KOBELKE, the Labor Minister for Consumer and Employment Protection, Western Australia in May 2005]

The Howard Government and most business groups maintained that AWAs are mutually beneficial for employers and employees, often promoting the view that 'flexibility' is paramount:

"AWAs give employers and employees flexibility in setting wages and conditions, and enable them to agree on arrangements that suit their workplaces and individual preferences. AWAs offer an employer and employees the opportunity to make an agreement that best suits the specific needs of individual employees. An existing employee cannot be forced to sign an AWA." [ Description of AWA] Office of the Employment Advocate, Accessed May 2005]

In April 2007 "The Sydney Morning Herald" reported that it had received unpublished Government spreadsheets that showed 27.8% of the agreements had stripped away conditions that were intended to be protected by lawcite news | first=Mark | last=Davis | coauthors= | title=Revealed: how AWAs strip work rights | date=2007-04-17 | publisher= | url = | work =The Sydney Morning Herald | pages = 1| accessdate = 2007-04-17 | language = ] [cite news | first= | last= | coauthors= | title=War of words erupts over leaked AWA data | date=2007-04-17 | publisher= | url = | work =ABC Online | pages = | accessdate = 2007-04-17 | language = ] . The spreadsheets were based on a sample of AWA agreements [cite news | first=Mark | last=David | coauthors= | title=No IR deal, say Rudd's state mates | date=2007-04-19 | publisher= | url = | work =The Sydney Morning Herald | pages = | accessdate = 2007-04-19 | language = ] .

In response to ongoing criticisms of WorkChoices and Australian Workplace Agreements, the Prime Minister at the time John Howard indicated the introduction of a new "fairness test" with an advertising campaign in May 2007 targeting women and youth which did not mention specifically either WorkChoices or AWAs. [cite news | first= | last= | coauthors=Misha Schubert and Andra Jackson | title=Unpopular WorkChoices 'brand' dumped in ads | date=2007-05-19 | publisher= | url = | work =The Age | pages = | accessdate = 2007-05-21 | language = ] However, the changes were not retrospective, leaving tens of thousands of workers on contracts that have removed conditions without the compensation that would be required under the current test. [cite news | first= | last= | coauthors=Misha Schubert and Ben Boherty | title=Thousands stranded on AWAs | date=2007-05-05 | publisher= | url = | work =The Age | pages = | accessdate = 2007-05-22 | language = ] Former Prime Minister John Howard stated:

"Can I just say that it was never intentional that it should become the norm that penalty rates and overtime loadings should be traded off without proper compensation. The fairness test will guarantee in a very simple way that will not occur." [cite news | first= | last= | coauthors= | title=IR laws not working as planned: Howard | date=2007-05-21 | publisher= | url = | work =ABC Online | pages = | accessdate = 2007-05-21 | language = ]

On 19 March, 2008, a bill was passed in the Senate that prevented new AWAs from being made, and set up provisions for workers to be transferred from AWAs into intermediate agreements. [ [ House of Reps seals 'death' of WorkChoices - ABC News (Australian Broadcasting Corporation) ] ]

ee also

*Australian Council of Trade Unions
*Australian Fair Pay and Conditions Standard
*Australian federal election, 2007
*Australian industrial relations legislation, 2005
*Australian Industrial Relations Commission
*Australian labour movement


* Workplace Relations Act (1996) [ via Austlii]


External links

* [ Office of the Employment Advocate]
* [ ACTU Assistant Secretary, Richard Marles on Individual Contracts]
* [ Fair Go - NSW Government website on the changes]
* [ ACCI Workplace Relations Policy Blueprint]

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