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Communtity Law Manual | Starting & leaving a job | Different types of employment agreements and arrangements

Different types of employment agreements and arrangements

Collective employment agreements for union members

What is a collective employment agreement?

Employment Relations Act 2000, ss 31–59

Collective agreements cover two or more employees and are negotiated by the employer and a union on the employees’ behalf (see “Union rights” in this chapter). A collective agreement can include more than one employer and more than one union.

When will I be covered by a collective agreement?

Employment Relations Act 2000, s 56

For you to be covered by a collective agreement your job must come within the scope of the agreement and you must be a member of the union that negotiated it.

If you’re a new employee and you’re covered by a collective agreement, your minimum terms and conditions of employment will be those set out in the agreement. As an individual you’ll also be able to negotiate additional terms.

What must be in a collective employment agreement?

Employment Relations Act 2000, ss 52–54, 69OJ; Holidays Act 2003, s 52

A collective employment agreement must be in writing and must be signed by each union and employer that is a party to it.

The agreement can contain whatever terms the parties to the agreement have agreed on. However, it must include the following terms:

  • Coverage – a clause stating what work or which group of employees the agreement covers
  • Wage rates – the wage or salary rates payable to the employees covered by the agreement
  • Rates for public holidays – a clause requiring employees to be paid at least time and a half if they work public holidays
  • Services for resolving problems – a plain-language explanation of the services available for resolving employment relationship problems
  • Amendments – a clause setting out how the agreement can be changed
  • Expiry – a clause stating the date when the agreement ends (expires) or specifying an event that will bring the agreement to an end (see also below, “How collective agreements come to an end”)
  • Protection in restructures – for most industries, a clause stating how the employer will protect the employees if the business is restructured. This doesn’t include industries like cleaning and catering services where workers have special legal protections because they’re particularly vulnerable to restructuring (see “Migrants and other vulnerable workers” in this chapter).

A collective employment agreement can’t include any terms that are contrary to the law or inconsistent with the Employment Relations Act.

Note: The law provides you with some minimum rights and conditions of work in key areas such as holidays and pay, and these are part of your employment relationship even if they’re not written into your agreement (see the chapter “Employment conditions and protections”). Employers and unions can’t agree to do away with any of these entitlements – they can, however, agree to better terms for the employees.

How collective agreements come to an end

Employment Relations Act 2000, s 52(3)

A collective employment agreement comes to an end on the expiry date stated in the agreement, or when the event specified in the agreement happens, or three years after the agreement begins, whichever of those three dates or events comes first.

But if the union or the employer initiates bargaining before the agreement expires, it continues in force for up to 12 months or until it’s replaced within the 12-month period with a new collective agreement.

How employers and unions negotiate collective employment agreements

Employment Relations Act 2000, ss 4, 31- 34

Employers and unions must deal with each other in good faith when negotiating collective agreements – this includes not misleading or deceiving each other.

During negotiations employers and unions are also required, as part of the duty of good faith, to:

  • do their best to agree on an effective bargaining process
  • meet together, and discuss, consider and respond to each other’s proposals
  • keep bargaining, even if they’ve reached a deadlock on one particular issue, in order to try to reach agreement on the other issues
  • come to a collective agreement unless there’s a genuine reason not to, based on reasonable grounds (an employer won’t have a “genuine reason” just because they disagree on principle with collective bargaining, as opposed to having individual agreements only)
  • respect the role of each other’s representative (if there is one) and bargain only through the representative
  • provide the other side with the information necessary to support their claims or responses.

Employment Relations Act 2000, s 35

A Code of Good Faith in Collective Bargaining has been developed to guide employers and unions on bargaining in good faith (see for more information).

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