Last week, the Full Bench of the Fair Work Commission (FWC) handed down its first ruling on the operation of the supported bargaining stream (Application by UWU, IEU & AEU [2023]).

What is the supported bargaining stream?

The scheme for supported bargaining came into effect on 1 July 2023 under the Secure Jobs, Better Pay amendments to the Fair Work Act 2009 (Cth) (FW Act). It is intended to assist those employees and employers who may have difficulty bargaining at the single-enterprise level, e.g. in low-paid industries such as aged care, disability care, and early childhood education and care where the necessary skills, resources and power to bargain effectively are absent. The supported bargaining stream is also designed to assist employees and employers who may face barriers to bargaining, such as employees with a disability and First Nations employees.

Supported bargaining requires FWC authorisation. This requires the FWC to be satisfied that it is appropriate for the employers and employees that will be covered by the agreement to bargain together as they have ‘clearly identifiable common interests’.

5 principles governing the consideration of a supported bargaining authorisation

The Full Bench outlined the following general principles governing the consideration of a supported bargaining authorisation (SBA):

1. The FWC must make an SBA where an application for authorisation is made, the FWC reaches a requisite state of satisfaction under the relevant FW Act provision, and at least some of the relevant employees are represented by an employee organisation.
2. The FWC must consider whether low rates of pay prevail in the industry. Low rates of pay will generally exist where employees are predominantly paid at or close to the award rates of pay. Importantly, however, where the award rate is relatively high, payment of at or close to award rates of pay may not constitute low rates of pay.
3. The expression ‘common interests’ is broad and extends to any joint, shared, related or like characteristics, qualities, undertaking or concerns between relevant employers so long as there are multiple and they are clearly identifiable (i.e. plainly discernible or recognisable, but not necessarily self-evident).
4. The number of bargaining representatives must be consistent with a manageable (i.e. workable or traceable) collective bargaining process.
5. The FWC has a broad discretionary scope to include any other matters it sees fit.

Application by UWU, IEU & AEU

Three unions made a joint application for an SBA, which specified 64 employers across the early childhood education and care (ECEC) sector that would be covered by the proposed agreement.

The FWC had regard to the following factors in ultimately approving the application for an SBA:

• pay rates for a substantial number of employees was at or close to award rates; 57.8% of employees in the ECEC sector were at award rates, while a further 20.9% were between 0.1% and 10% above the award rate;
• all 64 employers operated long day-care businesses in the ECEC sector, which led to a significant number of common interests including relevant awards, regulatory frameworks and government funding arrangements;
• the likely number of bargaining representatives was manageable as the employees were likely to be represented by only the three unions, while the 64 employers condensed into just three separate representative groups;
• none of the 64 employers opposed the making of the authorisation;
• the ECEC sector workforce is over 90% – an SBA would open the prospect of improving rates of pay, consequently helping to achieve greater gender equality; and
• a historically low uptake of bargaining in the ECEC sector due to the generally small size of businesses that lack the management capacity and other resources to engage in bargaining.