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INDUSTRIAL LAW REFORM (FAIR WORK) ACT 2005 (NO 3 OF 2005) - SECT 36

36—Amendment of section 81—Effect of enterprise agreement

Section 81—After subsection (3) insert:

        (4)         Subject to subsection (5), if—

            (a)         an enterprise agreement applies to the employees or a particular class of employees engaged in a particular business or undertaking; and

            (b)         a new employer becomes the successor, transmittee or assignee of the whole or part of the business or undertaking,

the new employer succeeds to the rights and obligations of the employer under the enterprise agreement.

        (5)         If—

            (a)         an employer is bound by an enterprise agreement (the "outgoing employer ); and

            (b)         another employer (the "incoming employer") then becomes, or is likely to become at a later time, the successor, transmittee or assignee of the whole or part of the business or undertaking of the outgoing employer,

the Commission may, on application under this subsection, by order—

            (c)         vary the enterprise agreement; or

            (d)         rescind the enterprise agreement.

        (6)         An application under subsection (5) may be made—

            (a)         by the outgoing employer (including such an employer who was previously an incoming employer), while he or she is still the employer under the enterprise agreement; or

            (b)         by the incoming employer after he or she takes over the whole or a part of the business or undertaking of the outgoing employer; or

            (c)         by an employee bound by the enterprise agreement (or a group of such employees) after the incoming employer takes over the whole or a part of the business or undertaking of the outgoing employer; or

            (d)         by a registered association acting on behalf of an employee or a group of employees bound by the enterprise agreement after the incoming employer takes over the whole or a part of the business or undertaking of the outgoing employer.

        (7)         The Commission may make an order on application under subsection (5) if (and only if)—

            (a)         the order only relates to provisions that regulate the performance of duties by employees or that relate to the remuneration of employees; and

            (b)         the Commission is satisfied that exceptional circumstances exist justifying the making of the order; and

            (c)         the Commission is satisfied—

                  (i)         that the order will not disadvantage employees in relation to their terms and conditions of employment; or

                  (ii)         that the order will assist in a reasonable strategy on the part of the employer to deal with a short-term crisis in, and to assist in the revival of, the relevant business or undertaking.

        (8)         For the purposes of subsection (7), an order disadvantages an employee or employees in relation to their terms and conditions of employment if, on balance, its making would result in a reduction in the overall terms and conditions of employment of that employee or those employees.

        (9)         The Commission must, in making an order under subsection (5), take into account the length of time remaining until the end of the term of the enterprise agreement.

        (10)         An order under subsection (5)—

            (a)         must not take effect before the transfer of the relevant business or undertaking to the incoming employer;

            (b)         may be made on the basis that the incoming employer will only be bound by the enterprise agreement for a limited period of time (and then the enterprise agreement will be taken to be rescinded);

            (c)         may be made on the basis that any variation to the enterprise agreement will only have effect for a limited period of time.

        (11)         Nothing in this section limits the ability to vary or rescind an enterprise agreement under another provision.



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