Distinguish between an Award and an Enterprise Agreement

When discussing workplace agreements in Australia, two terms that are often used interchangeably are “award” and “enterprise agreement”. However, these are two very different types of agreements and it is important to understand the distinctions between them.

An award is a legal document that outlines the minimum terms and conditions of employment for a particular industry or occupation. Awards are set by the Fair Work Commission and cover areas such as wages, hours of work, leave entitlements, and other conditions of employment. They apply to all employees within a particular industry or occupation, regardless of the size of the business or the specific role the employee holds.

Enterprise agreements, on the other hand, are agreements negotiated between employers and employees (or their representatives) that cover specific workplaces or groups of employees. These agreements can vary from workplace to workplace and can provide more specific or unique terms and conditions than those set out in awards. This can include things like flexible working arrangements, additional leave entitlements, and higher wages than those set out in the relevant award.

It is important to note that enterprise agreements can only be made if they meet certain requirements and are approved by the Fair Work Commission. These requirements include ensuring that the agreement benefits employees overall and does not undercut the minimum standards set out in the relevant award.

One key difference between awards and enterprise agreements is how they are enforced. As awards are legally binding documents, any breaches can be enforced through the courts or the Fair Work Ombudsman. However, if an enterprise agreement is breached, it must first go through a dispute resolution process before any legal action can be taken.

In summary, awards and enterprise agreements are two different types of workplace agreements in Australia. Awards set out the minimum standards for a particular industry or occupation, while enterprise agreements are negotiated between employers and employees and can provide more specific or unique terms and conditions for individual workplaces or groups of employees. Understanding the differences between these agreements is crucial for both employers and employees to ensure they are meeting their obligations and receiving fair and reasonable conditions.