Fair Work Act 2009

An enterprise agreement must include a term (a flexibility term) that:

enables an employee and his or her employer to agree to an arrangement (an individual flexibility arrangement) varying the effect of the agreement in relation to the employee and the employer, in order to meet the genuine needs of the employee and employer; and

complies with section 203.

If an employee and employer agree to an individual flexibility arrangement under a flexibility term in an enterprise agreement:

the agreement has effect in relation to the employee and the employer as if it were varied by the arrangement; and

the arrangement is taken to be a term of the agreement.

To avoid doubt, the individual flexibility arrangement:

does not change the effect the agreement has in relation to the employer and any other employee; and

does not have any effect other than as a term of the agreement.

If an enterprise agreement does not include a flexibility term, the model flexibility term is taken to be a term of the agreement.

The FWC must determine the model flexibility term for enterprise agreements.

In determining the model flexibility term, the FWC must:

ensure that the model term is consistent with the requirements set out in subsection (1); and

take into account the following matters:

whether the model term is broadly consistent with comparable terms in modern awards;

best practice workplace relations as determined by the FWC;

whether all persons and bodies have had a reasonable opportunity to be heard and make submissions to the FWC for consideration in determining the model term;

the object of this Act (see section 3), and the objects of this Part (see section 171);

any other matters the FWC considers relevant.

The FWC must be constituted by a Full Bench to make the model flexibility term (see subsection 616(4A)).

For the variation of a determination, see subsection 33(3) of the Acts Interpretation Act 1901.

A determination under subsection (5) is a legislative instrument, but section 42 (disallowance) of the Legislation Act 2003 does not apply to the determination.