It’s certainly a unique and challenging environment in which to renegotiate or negotiate an Enterprise Agreement. We have a new ALP Government, high inflation, and growing discontent and resentment that wages that are not keeping pace – all of which are impacting the current bargaining environment. Below, are just some of the trends we are seeing out there this bargaining round.
An increase in ambit excessive wage claims
With rising costs of living putting pressure on all parties involved in enterprise bargaining, employers are encouraged to respond strategically to ambit claims.
Many members are reporting they are facing excessive wage increase demands following a higher-than-usual 5.2% rise in the National Minimum Wage in July.
At the same time, civil contracting businesses are facing spiraling operating costs.
Make sure you respond strategically to ambit claims, how you manage these claims will be important!
Claims around cost of living pressures
Employees are seeking higher wages to manage their own personal pressure of cost of living. From a cost-of-living perspective, there is pressure on all the bargaining parties, not just employees so you need to strategically communicate that and ensure that is well understood from your workforce.
Claims linking the wage increase to CPI
Pay rises linked to CPI as the latest inflation figures have in some instances triggered pay increases of up to 8% for some workers. Why? Because employers who negotiated deals in say 2019 and 2021 when inflation was between 1.1% and 1.6%, have been shocked as the pay rises linked to growing inflation delivered unexpected windfalls for workers.
Certainly, CPI-linked pay rises are still relatively rare for enterprise agreements, but with the pressures of growing inflation we certainly are seeing a trend by unions towards pursuing this type of wage claim.
Quicker turnaround on Enterprise Agreements
As a positive, our Human Resources Management consultants at Ridgeline HR have also reported that there has been a substantial improvement in the processing time for enterprise agreements at the Fair Work Commission.
Given the improved processing time, now is a good time to do one.
Additionally, if your agreement has passed its nominal expiry date, it would be an opportune time to review and replace your current agreement.
There are many reasons why you might want to put an enterprise agreement in place – see this article for more on that: https://ridgelinehr.com.au/is-an-enterprise-agreement-the-answer/.
Our pro tip – Communication
- When you are dealing with excessive bargaining claims, it helps that employees as a baseline understand the narrative of where the business is going, the operational environment, the current state of the market and its relevant impacts, as well as the vision for the future. Start engaging employees early in your business imperatives pre-bargaining, and you can unlock and open up a better environment to bargain in. In our experience, the work on gaining genuine engagement of employees on the business imperatives pre-bargaining will not be time wasted!
- Consistent, transparent and emphatic messaging will be at a high premium pre-bargaining and during negotiations. You cannot be tone deaf in your communications, “spin” and “fluff” are not going to cut it, you need to be genuine, and real.
- Now, more than any other round of bargaining, Employees need to believe you genuinely care, and that you place a high priority on their health, safety and wellbeing – make sure you are reflecting that in your communications and engagement approach.
-Nicole Walsh Executive Manager, Industry Capability & Engagement – CCF Victoria
-Peter Maguire- Ridgeline HR