FAQ

Frequently Asked Questions

The Minister for Workplace Relations, the Hon. Michael Wood, has said that he wants to introduce new legislation to create Fair Pay Agreements by the end end of the year [2021]. Then they will go through a full Parliamentary process, including a full Select Committe process. He hopes a new law will be passed in May 2022. 

The current proposal is that the process can start one of two ways. Either by meeting a "representation test" or a "public interest test".

For the representation test, 1,000 workers or 10 percent of workers in a particular sector or occupation (whichever is lower) will have to call for a Fair Pay Agreement. A union or unions will coordinate collecting evidence of that, and will present it to the Ministry of Business, Innovation and Employment.

For the public interest test, a union will need to make the case that a particular sector or occupation faces a number of problems or characteristics that mean it is in everyone's interest that a Fair Pay Agreement is set up. Those problems or characteristics might be things like high levels of worker exploitation, a bad health and safety record, wages stuck on the minimum wage or high levels of insecure work.   

Unlike other employment agreements, Fair Pay Agreements are not a contract - either between an employer and an individual in the case of an individual employment agreement or an employer and the members of a union in a collective employment agreement.

Rather, Fair Pay Agreements will be laws. The agreed terms in each Fair Pay Agreement will be set as what is called secondary legislation (where Parliament passes its power to make rules to someone else). So those terms will act like the minimum wage, which is secondary legislation from the Minimum Wage Act. 

You will still need to have an employment agreement - collective or individual - but no terms in that agreement will be allowed to be less than what the Fair Pay Agreement says. There may be things that the Fair Pay Agreement doesn't cover that will still need to be covered by your individual or collective agreement.