Section 524 Fair Work Act 2009

Section 524 of the Fair Work Act 2009 (Cth) (the Act) provides the legal framework for the operation of enterprise agreements that are made under a singleenterprise agreement (SEA). It sets out the processes that must be followed for an agreement to be approved, the requirements for voting, and the circumstances in which the Fair Work Commission (FWC) can intervene.

Key Objectives of Section 524

• Ensuring democratic decisionmaking: The section establishes a clear voting threshold and a compulsory ballot for employees.
• Protecting employee rights: It ensures that agreements do not contravene the nations minimum standards, such as the National Employment Standards (NES) and modern award coverage.
• Providing oversight: The FWC retains a supervisory role to protect the public interest and to reject agreements that fail to meet statutory requirements.

When Does Section 524 Apply?

Section 524 applies specifically to:

• Enterprise agreements that are negotiated and lodged under the singleenterprise agreement regime.
• Agreements that seek approval from the FWC without requiring a separate approval by the Commission process under other sections of the Act.

Core Requirements

1. Mandatory Voting Process

Before an agreement can be lodged with the FWC, the employer must conduct a secret ballot of all employees who will be covered by the agreement. The voting must meet the following thresholds:

• At least 50% plus one of the employees who cast a vote must vote in favour.
• At least 50% plus one of the total eligible employees (including those who abstain) must also vote in favour.

If either threshold is not met, the agreement cannot proceed to lodgement.

2. Information to be Provided to Employees

The employer must supply a fair and balanced summary of the agreement, including:

• The principal terms and conditions.
• How the agreement will affect entitlements such as leave, hours of work, and redundancy.
• The rights of employees to seek assistance from a union or other representative.

3. Lodge with the Fair Work Commission

Once the voting thresholds are satisfied, the employer lodges the agreement with the FWC, together with:

• A copy of the signed agreement.
• Evidence of the voting results (e.g., ballot count).
• A declaration that the agreement does not contain any prohibited terms.

4. Review by the Fair Work Commission

The FWC will examine the agreement to ensure compliance with the Act. The Commission may:

• Approve the agreement if it meets all statutory requirements.
• Reject the agreement if it breaches the NES, award coverage, or contains unlawful provisions.
• Require amendments and give the parties an opportunity to correct deficiencies.

What Happens After Approval?

Once approved, the agreement becomes a legally binding instrument for both the employer and the covered employees. It supersedes award provisions to the extent that it is consistent with the Act. Employees retain the right to take industrial action if the employer breaches the agreement.

Common Issues and How to Avoid Them

• Failure to meet voting thresholds: Conduct the ballot early, keep clear records, and ensure all eligible employees receive the voting material.
• Unbalanced information: Provide a neutral summary and allow employees to seek independent advice.
• Prohibited terms: Review the agreement against the list of prohibited terms before lodging.
• Late lodgement: Submit all documents promptly after the ballot to avoid unnecessary delays.

Case Example

In *Re: Installation Services Pty Ltd* (2022), the FWC rejected a proposed SEA because the ballot result showed 48% of eligible employees voted in favour, falling short of the 50%+1 requirement. The Commission emphasised that the dualthreshold rule is nonnegotiable and designed to protect minority employees. Fair Work Commission decision, 12 March 2022.

Resources for Employers and Employees

• Fair Work Commission Enterprise Agreements
• Fair Work Ombudsman How to make an enterprise agreement
• Legal advice from a qualified employment lawyer is recommended for complex negotiations.

Summary

Section 524 of the Fair Work Act 2009 sets out a robust, democratic process for the creation of singleenterprise agreements. By requiring a clear majority vote, providing for transparent information, and maintaining oversight by the Fair Work Commission, the provision balances the flexibility needed by modern workplaces with essential protections for employees. Understanding and complying with these requirements is crucial for any employer seeking to formalise workplace terms through an enterprise agreement.

*All references are current as of June 2026.*