BOOTS – Secure Jobs Better Pay Bill Update

One of the changes that has come out of the Secure Jobs, Better Pay Bill is the way that BOOT are assessed under an Enterprise Bargaining Agreement. Currently The Fair Work Commission will only approve an enterprise agreement if it is satisfied that each award covered employee and each prospective award covered employee would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee. By implementing these changes, the aim is too remove the prospective employees and only deal with what employees it currently applies to.

What is a BOOT ?

In summary and in this circumstance, the BOOT is a test used by the Fair Work Commission to evaluate the fairness of an enterprise agreement for employees. The test compares the terms of the proposed agreement to those in the relevant modern award and only approves the agreement if it finds that each employee would be better off overall under the agreement than they would be under the award. The recent legislation amendment aims to clarify and update the BOOT, and these changes will take effect on June 6, 2023.

Misunderstandings that can occur regarding the BOOTs in enterprise bargaining.

The BOOT is only applied to financial benefits: One of the most common misconceptions about the BOOT is that it only applies to financial benefits and that other non-financial benefits, such as working hours and leave entitlements, are not considered. However, the BOOT applies to all terms and conditions of employment, including financial and non-financial benefits.

The BOOT is applied only at the time of agreement approval: Another common misunderstanding is that the BOOT is only applied at the time of agreement approval and that once an agreement is approved, there is no ongoing obligation to ensure that employees remain better off overall. In fact, the BOOT applies throughout the life of the agreement and must be continuously satisfied.

The BOOT can be bypassed with a simple opt-out clause: A third common misconception is that the BOOT can be bypassed by including an opt-out clause in the agreement. This is not the case as the FWC must be satisfied that each award-covered employee and prospective award-covered employee would be better off overall even if they did not exercise the opt-out option.

Practical takeaways:

• The BOOT applies to all terms and conditions of employment, including financial and non-financial benefits.
• The BOOT must be continuously satisfied throughout the life of the agreement.
• The BOOT cannot be bypassed with a simple opt-out clause.

What do Employers need to do ?

Ensure that all terms and conditions of employment, both monetary and non-monetary, are considered when assessing the BOOT and the impact of proposed changes to the existing enterprise agreement.

Review and monitor the enterprise agreement to ensure that the BOOT continues to be satisfied throughout the life of the agreement and all employees continue to be better off overall compared to the relevant modern award.

Another common misunderstanding is that the BOOT only applies to wages and salaries. The BOOT assessment applies to all terms and conditions of employment, not just wages and salaries. This means that conditions such as leave entitlements, hours of work, shift arrangements and many others, are also taken into consideration when assessing the BOOT. Failing to understand the full scope of the BOOT assessment can result in some important terms and conditions being overlooked during negotiations, which can impact the overall assessment outcome.

It is important to understand that the BOOT is not determined by the employer, but rather by the Fair Work Commission. This is a common misconception and can lead to confusion in enterprise bargaining. The employer’s role is to provide the necessary information to the FWC for the BOOT assessment, but the ultimate decision is made by the FWC. This helps to ensure that the BOOT is an impartial and objective assessment.

Conclusion

In conclusion the changes aim to simplify and streamline the BOOT process by making it a global assessment, removing the risk of a remote example compromising the approval of an entire agreement, providing the FWC with powers to amend or remove terms in the agreement if they don’t meet the BOOT, and establishing a new pathway for reconsideration of the BOOT. Employers should carefully consider the BOOT process and ensure that those involved in bargaining have a good understanding of the BOOT to avoid misunderstandings and promote a productive approach to enterprise bargaining.