While there are no longer statutory individual contracts under the Fair Work Act 2009, an employee and employer can enter into an individual flexibility agreement (IFA) which varies the terms and conditions of an enterprise agreement in order to meet the genuine needs of the employee and employer.
Every enterprise agreement must contain a flexibility term that provides for individual flexibility agreements.
When an employer and an employee enter into an IFA it must;
. be genuinely agreed to by the employer and the employee
. result in the employee being better off overall than the employee would have been if no IFA was made
. be signed by both the employer and the employee
. be signed by a parent or guardian of the employee in the case where the employee is under 18 years of age.
. a copy of the IFA must be provided to the employee within 14 days of agreement.
If an IFA does not adhere to these terms it will still have effect. However, it may be in contravention of the Fair Work Act 2009. There are also strong protections which prevent undue influence or pressure being applied to an employee to get them to enter into an IFA. Penalties of up to $6,600 for an individual and $33,000 for a corporation can apply.
An IFA can be terminated either by mutual agreement in writing between the employer and the employee, or by either the employer or employee, by giving written notice of not more than 28 days.
For more information please contact Kenneth J Law