The government’s announcement last week around Fair Pay Agreements was met with mixed reactions and, for some of us, a healthy amount of confusion. So, what even is a Fair Pay Agreement and how will it affect your workplace?
Fair Pay Agreements (FPAs) are similar to a collective employment agreement, but instead of being negotiated with one employer, they involve all employers in a particular industry. FPAs will also cover all employees who hold the same job position in the industry regardless of whether they are union members or not.
MP Michael Woods compares FPAs to a minimum wage, as they will put in place minimum standards that an employer has to meet around base wage rates, ordinary hours, overtime and penalty rates.
The Fair Pay Agreement system has not been made into law yet, with a draft bill to be released later this year. The bill will take some time to go through the legislative process to be finalised into an act. The proposed system could also change during that process, so watch this space!
Once the FPA system becomes law, it will affect only specific industries where the FPA bargaining system is triggered. If you hear that your industry will be starting the FPA process, contact the Gaze Burt employment team for advice.
Please note that this information is not a substitution for legal advice. For any issues or queries relating to employment, please feel free to contact the employment team at Gaze Burt.