Do you have a Zombie Agreement in your workplace?

A Zombie Agreement is a Collective or Certified (or other) Agreement that was made before the Fair Work Act 2009 (Cth) (‘FW Act’) came into full effect on 1 January 2010.

If you do have a Zombie Agreement, it is essential to be prepared for changes from 7 December, when Zombie Agreements sunset. That is, they will not exist as an Agreement that applies to your employees.

From 7 December 2023, businesses previously covered by Zombie Agreements will be required to pay under the appropriate Modern Award if they haven’t already received an extension for the Zombie Agreement – which can only be granted by the Fair Work Commission – or entered into a new Enterprise Agreement.

For most businesses who are impacted this will mean:

• Getting to know the Modern Award that applies to each and every employee in your workplace; and
• Understanding the classifications, rates of pay, entitlements and ways of organising work that will need to be followed to ensure compliance.

Background

 On 6 December 2022, the Fair Work Legislation Amendment (Secure Jobs Better Pay) Act 2022 took effect making several changes to the industrial relations landscape.

One of those changes was the scheduled sunsetting (see ‘termination’) of workplace agreements made before 2010. As mentioned, these agreements have been commonly referred to as ‘Zombie Agreements’.

The purpose for sunsetting Zombie Agreement is to bring those businesses, and the entitlements held by those employees, in line with the modern standards provided by Modern Awards, which have evolved over the past 13 years.

What will this mean for employers? 

Only employers and employees who are currently covered by a Zombie Agreement will be affected.

For those employers who are affected, it will mean:

• The need to review Modern Award coverage and identify the one/s that will cover the workforce instead of the Zombie Agreement;
• The need to review and interpret Modern Award levels/grades;
• Make the necessary changes to rates of pay and allowances, including the need to pay new allowances;
• The need to review hours and days of operation to meet ordinary hours of work requirement;
• The need to review individual arrangements as they relate to the different forms of employment (full-time hours as compared to part-time and casual hours); and,
• Other general interpretation of legislation, including how Modern Awards treat overtime, annual leave and public holidays.

Many businesses are already doing this preparation, however if you have not started looking into the above, it’s time to do so. The Workplace Advisory Services team at Business Chamber Queensland can assist you with this.

Preparing for the end of your Zombie Agreement and reviewing and actioning the above will need to be completed before the end of the first full payroll after the Zombie Agreement terminates at midnight on 6 December. The changes take effect mid-week on a Wednesday, so this may require two separate pay runs or split rosters.

Unsure If This Impacts You?

Financial members with HR services as part of their Business Chamber Queensland membership can call or email the team for free advice on whether a Zombie Agreement applies. We can then let you know what the next step is, if one does apply.

Non-members, or members who do not have HR services as part of their membership, can also contact the team for assistance at a competitive hourly consulting rate.

How We Can Help

Business Chamber Queensland can assist with many of the above tasks to ensure you are ready, and are compliant.

The following services are available:

If you are considering this service or have other questions about your sunsetting Zombie Agreement, please reach out to the Workplace Advisory Services team.