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Better drafting of agreements otherwise litigation inevitable, judge warns

Litigation is inevitable warns a senior member of the Federal Court’s IR panel if those who draft enterprise agreements choose to use euphemisms as a means to conceal the parties’ differences on terms.


Justice Chris Jessup told the Australian Labour Law Association's conference held recently in Melbourne that it was a possibility the courts only saw the most poorly-drafted enterprise deals; adding that he would like to see a bit less “mysterious offhandedness” in the language of agreements.

"The impression I get is that enterprise agreements generally could benefit from a greater awareness, on the part of their drafters, of the importance of a clear identification of what must, or must not, be done in specific situations, and from a reduction in the use of euphemisms which, as often as not, reflect not a consensus on the part of the agreement-makers but a successful search for a 'form of words' designed to accommodate, and to conceal, very different understandings", says Justice Jessup.

One of three national coordinating judges for the court's employment and IR practice area, he cited a ruling by a full court last year as a reminder to all that such an approach to drafting "inevitably leads to litigation".

In the case between the NTEU and a university in Victoria, the court ruled that a passively-worded redundancy clause in the university’s enterprise agreement imposes firm obligations on it to exhaust all other options before it could proceed with any compulsory redundancies. In October last year, the NTEU argued that the university breached its 2014 collective agreement when it announced it would make 280 employees redundant, 100 of them via compulsory retrenchments.

As a result of the court’s decision, the NTEU will have strengthened its position with about a dozen other universities. According to Josh Cullinan, NTEU Victoria division senior industrial officer, these types of clauses were replicated in about half of the union's agreements with universities and with implications for the job security of "hundreds of thousands of workers", he expects it would be "often quoted over the next few years".

Organisations who need to undergo collective bargaining and draft enterprise agreements should pay heed to this ruling and Justice Jessup’s warning in order to steer away from litigious risk and other costly repercussions that may perpetuate beyond one incident.

iHR Australia can help to develop and draft your enterprise agreement in line with organisational objectives and strategies. Our experienced HR consultants support and collaborate with you throughout the development, negotiation, approval and implementation phases of your enterprise agreement. We offer a comprehensive range of enterprise agreement services with expert advice, assistance and can act as your bargaining representative. Our expertise and skills bring an independent and objective perspective to the entire process to ensure that terms and conditions adheres to relevant legislation and are mutually beneficial to both the employer and employees.

Our services include:
• Development and drafting your enterprise agreement in line with organisational objectives and strategies
• Communication strategies, agenda setting and timetabling
• Negotiations with your employees and their nominated bargaining representatives (including unions)
• Advice in relation to protected industrial action, if any
• Approval processes (voting, etc.)
• Applications for approval to relevant tribunals
• Representation and advocacy in tribunals, as required
• Advice and interpretation of applicable legislation
• Adherence to the Fair Work Act 2009
• Adherence to good faith bargaining requirements and scope orders.
To find out more about iHR Australia’s Enterprise Agreement services please call 1300 884 687 or make an online enquiry.

Melbourne Office : 
Suite 11, 828 High Street Kew East Victoria 3102
Sydney Office :
Level 34 AMP Tower, 50 Bridge Street, Sydney 2000

Bangkok Office :

88 Paso Tower 14th Floor Unit A1 Silom Road , Suriyawong, Bangrak, Bangkok 10500

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