Zombie agreements
Key dates
6 June 2023: Employers required to provide notice of terminating zombie agreements to affected employees. 7 December 2023: Zombie agreements cease to operate unless an extension has been sought in the Fair Work Commission.
What's changing?
Under the FW Act changes, zombie agreements will automatically "sunset" and cease operating on 7 December 2023. Unless relevant employers/employees/unions apply to the Fair Work Commission (FWC) for a zombie agreement to be extended (and this application is granted by the FWC), from 7 December affected employees will revert from their zombie agreement to the applicable modern award.
Background
Pre-reform workplace agreements (or "zombie" agreements) are those that have been made before the commencement of the Fair Work Act 2009 (Cth) (ie. prior to 2010). The most common types of zombie agreements are collective agreements, workplace agreements, and Australian workplace agreements made under the Workplace Relations Act 1996 (Cth).
Actions
Before 6 June
- Identify any zombie agreements within your organisation and the employees covered by them, as well as the relevant modern awards that would otherwise apply. Assess whether the affected employees will be better off under the relevant modern award or their zombie agreement, as this will inform your employee communications and help to ascertain whether an application to the FWC for an extension of the zombie agreement may be successful.
- Notify affected employees that they are covered by a zombie agreement that will be terminated on 7 December unless an extension is granted by the FWC. Failure to issue this notice will be a breach of the FW Act and incur a maximum penalty of $16,500 for individuals and $82,500 for entities.
After 6 June
- Monitor and prepare for the 7 December deadline, including preparing a contingency plan in the event employees/unions apply to the FWC for an extension of a zombie agreement, or seek to initiate enterprise bargaining (whether single or multi-enterprise bargaining).
- Prepare systems and processes for a smooth transition to a modern award for employees covered by zombie agreements. This includes payroll, rosters, time and attendance, manager training, etc.
For more information, visit: The rise and demise of zombie agreements