What is the difference between an award and an enterprise agreement in Australia?

Awards vs Enterprise Agreements in Australia

Both awards and enterprise agreements set minimum pay and conditions for workers, but they work differently:

Awards

• Set by the Fair Work Commission – independent government body
• Apply industry-wide – cover all workers in that industry unless an enterprise agreement exists
• Minimum standards – set minimum pay rates, hours, breaks, leave, and other conditions
• Cannot be undercut – your employer cannot pay you less than the award rate
• No negotiation needed – automatically apply to your job

Enterprise Agreements

• Negotiated between employer and employees – created specifically for that workplace
• Must be better overall – cannot be worse than the relevant award
• Customised conditions – can include different pay scales, hours, or benefits suited to that business
• Requires approval – must be approved by the Fair Work Commission and voted on by employees
• Replaces the award – if approved, it applies instead of the industry award

Key Difference

Awards are automatic minimum standards. Enterprise agreements are custom arrangements that must meet or exceed those minimums. If your workplace has an enterprise agreement, that applies to you instead of the award – but it should never give you worse conditions overall.

What This Means for You

Check which applies to your job by asking your employer or looking up your industry award. You can find all Australian awards and enterprise agreements on the Fair Work Ombudsman website.

Fair Work Ombudsman – Awards and Agreements

Fair Work Commission

This is general information only. Check official sources before acting.