We get a lot of questions about IFA’s.
What is an IFA you ask? – an Individual Flexibility Agreement.
But didn’t individual contracts go out with Workchoices? Well, yes. Which is why IFA’s make our tummies turn!
Strictly speaking an IFA is a written agreement between the employer and employee document that is used to change the effect of certain clauses in a an award or enterprise/registered agreement which will be of advantage to the employee.
However …. we see some employers using IFA’s as a way to get around Award clauses that don’t suit their business operations. I totally understand! In my café owning days, the meal breaks were always an issue as they always came across the lunch rush. I would have loved an IFA that provided more flexibility around the taking of breaks. However the intent of an IFA is to provide flexibility that will be of benefit to the employee.
We therefore plead caution on using an IFA.
An IFA can’t be used to reduce or remove an employee’s entitlements.
An employer has to make sure that the employee is better off overall with the IFA than without it compared to their Award at the time the IFA was made.
You can use an IFA to vary clauses about:
arrangements for when work is performed, such as working hours
overtime rates
penalty rates
allowances
leave loading.
IFA Top Tips:
An IFA must be a written agreement signed by the employee and employer
An IFA must be made as a genuine agreement between the employer and employee – IE you cannot make an IFA a condition of employment. An employee’s right to refuse to agree to an IFA is protected by their general protections. This means that they can’t be discriminated against or treated adversely for refusing to agree to one.
An IFA can be ended at any time by written agreement between the employer and employee. If one party wishes to end an IFA made under an award without the other party’s agreement, they generally need to provide 13 weeks’ written notice. For an IFA made under an enterprise or other registered agreement, the notice period will depend on the terms of that agreement.
An IFA cannot be used to reduce or remove an employee’s minimum entitlements.
Check - does the IFA genuinely benefit the employee? If the IFA doesn’t benefit the employee, then you are potentially on shaky ground.
An IFA doesn’t need to be approved or registered with the Fair Work Ombudsman or the Fair Work Commission.
