Bargaining fee arrangements

What is a bargaining fee arrangement?

A bargaining fee arrangement is an arrangement where employees who are not members of a union can be employed on the same terms and conditions as those in a collective agreement if they pay a bargaining fee to the union that negotiated the collective agreement. The bargaining fee recognises the work done by the union in bargaining for these terms and conditions.

A bargaining fee arrangement is one of the ways that employers and unions can reach agreement about passing on collective terms and conditions.

What are the rules for bargaining fee arrangements?

For a bargaining fee arrangement to apply employers and unions must freely agree to the bargaining fee clause in a collective agreement.

The bargaining fee clause must contain:

• the amount of the bargaining fee (which cannot be more than the usual union fee)
• the length of time employees will have to ‘opt out’ of the bargaining fee arrangement

It can also contain other details, such as whether the fee is a lump sum or paid on a periodic basis (eg, fortnightly).

Unions cannot strike and employers cannot lock out employees over proposals for bargaining fee arrangements, and they cannot refuse to conclude a collective agreement just because they want the agreement to include a bargaining fee clause.

If a bargaining fee clause is agreed to, the union and the employer must conduct a secret ballot before the collective agreement comes into force.

The secret ballot is of the employees:

• performing the work described in the coverage clause of the collective agreement
• who are not members of a union, or who are members of the union that agreed to the collective agreement containing the bargaining fee clause.

If the majority of employees who vote agree to the bargaining fee clause, it will apply. If so, the employer must notify the following employees about the bargaining fee clause and give them an opportunity to opt out:

• employees whose work is covered by the agreement ; and
• who are not union members; and
• who were entitled to vote in the secret ballot, or who were employed after the secret ballot took place and before the collective agreement came into force.

The length of time the employees have to opt out must be stated in the bargaining fee clause.

Who has to pay a bargaining fee?

If an employee does not opt out within the time stated in the bargaining fee clause, then they will be employed under the same terms and conditions as the collective agreement and will have to pay the bargaining fee. The employer must deduct the bargaining fee from the employee’s wages and pay it to the union

An employee who pays a bargaining fee is no longer required to do so if he or she:

• joins a union
• changes jobs and their work is no longer covered by the collective agreement; or
• stops working for the employer.

A bargaining fee clause expires at the same time as the collective agreement.

Employees who are union members do not have to pay the bargaining fee because they are already paying a membership fee to a union.

New employees who begin work after the collective agreement comes into force and whose terms and conditions are those of the collective agreement under the ’30-day rule’ will not be required to pay a bargaining fee.

What happens if employees opt out of paying the bargaining fee?

If employees opt out of paying the bargaining fee, they retain their existing terms and conditions and can negotiate any changes with their employer.