Enterprise bargaining is the process of negotiating an agreement between employers and employees regarding employment conditions and remuneration. The Fair Work Act 2009 (Fair Work Act) sets out the rules and obligations on how the negotiation process should occur, including rules about bargaining, the content of enterprise agreements, and how an agreement is made and approved.
Workplace bargaining at the entity level in the Australian Public Service (APS) was first introduced in 1993 through the Industrial Relations Reform Act 1993. This allowed each entity to have pay and conditions specific to the work performed. The APS returned to a centralised, whole of APS agreement with the Continuous Improvement in the Australian Public Service Enterprise Agreement: 1995–96: Agreement Between the Commonwealth Government and the Public Sector Unions. The Government reintroduced entity based bargaining for the APS at the conclusion of that agreement in 1996 and has continued to negotiate remuneration and conditions at the entity level since.
Enterprise agreements apply to around 98 per cent of APS employees. To support the significant cost associated with remuneration increases negotiated as part of enterprise agreements (estimated at around $1.6 billion over three years), the 2014 and 2015 Workplace Bargaining Frameworks were expected to deliver wage increases based on productivity improvements rather than increased costs to taxpayers or reduced service delivery. There has also been Parliamentary and stakeholder interest in the effectiveness of the frameworks in delivering consistent agreements and productivity improvements, as well as compliance with the bargaining policies. The audit also aimed to identify lessons learned that could be used to inform the implementation of future bargaining frameworks.
The objective of the audit was to assess the Australian Public Service Commission’s and selected entities’ implementation of the Australian government’s workplace bargaining framework.
To form a conclusion against the audit objective, the ANAO adopted the following high level criteria:
- Does the APSC have effective arrangements in place to support the implementation of the workplace bargaining framework?
- Have selected entities implemented the workplace bargaining framework effectively?
- Have selected entities developed and monitored productivity improvements appropriately?