Legislative Update – Amendments to NERR Requirements

A recent amendment to the Fair Work Act 2009 (Cth) (FW Act) has relaxed the strict technical approach to the Notice of Employee Representational Rights (NERR) required for the approval of proposed enterprise agreements.

The amendment provides employers applying for the approval of proposed enterprise agreements with some relief, however strict compliance should remain the objective nonetheless.

Timeline of changes to the FW Act

Section 173 of the FW Act requires an employer to take all reasonable steps to notify each employee, who will be covered by a proposed enterprise agreement, of the right to be represented by a bargaining representative. This is known as the NERR.

Amendments were made to the FW Act in January 2012, where the NERR was required to:

• contain specific content;
• be in the form prescribed by the Fair Work Regulations 2009 (Cth) (FW Regulations); and
• contain no other material.

However, the January 2012 amendments resulted in the Fair Work Commission (Commission) taking an extremely strict approach to the application of the amendment. The Commission’s decisions would result in proposed enterprise agreements not being approved due to minor technical invalidities. As such, employers would have to commence the bargaining process from the beginning.

In 2017, the FW Regulations were amended to specify what content is required in the NERR to aid employers in future bargaining processes. The main amendment was the removal of the Commission’s website and telephone number from the NERR. The amendments were minor and largely technical, however employers must ensure they are using the correct up-to-date version of the NERR.

The 2018 amendment

In 2015, the Productivity Commission recommended changes to the FW Act. The changes were to allow minor procedural or technical errors to be overlooked in respect of the NERR.

The changes were brought on to allow for proposed enterprise agreements to be streamlined in the process of approval. However, proposed enterprise agreements were still required to meet the other requirements of the FW Act. The legislation to implement this change was passed in December 2018.

Section 188 of the FW Act sets out the test as to whether employees have genuinely agreed to an enterprise agreement, which is one of the requirements for a proposed enterprise agreement to be approved. The relevant amendment added section 188(2), a new sub-section to section 188 of the FW Act.

Section 188(2) of the FW Act provides that a proposed enterprise agreement will have been genuinely agreed to by employees if the Commission is satisfied that:

• The agreement would have been genuinely agreed to (within the meaning of section 188(1) of the FW Act) but for minor procedural or technical errors made in relation to the requirements of the NERR or other requirements of proposed enterprise agreement bargaining; and
• The employees covered by the agreement were not likely to have been disadvantaged by the errors, in relation to those requirements.

Take home messages

The amendment has eased the previously strict application of the Commission on the requirements of the NERR required by employers.

The changes accommodate for any ‘minor technical or procedural errors’ provides employers with some comfort. However, employers are still required to strictly adhere to any other requirements of the FW Act.

Employers should proceed with caution when issuing the NERR, as any subsequent changes to the NERR could result in the employees’ understanding of their rights to be affected. If changes or mistakes are needed to be corrected, the bargaining process will restart.