Individual Flexibility Agreements

As a school principal one of the many ‘hats’ you wear is that of HR manager. This often means discussing and negotiating employment terms and conditions with your staff. By extension, this can include implementation of Individual Flexibility Agreements (“IFA”). Staff will commonly approach you to discuss amendments to their hours of work, pattern of work and leave arrangements. In these circumstances, an IFA might be appropriate.

So that you are positioned to confidently have these discussions with your staff,  it is important that you understand your obligations around offering and implementing IFAs, including what is reasonable (and what is not) for employees to request.

What is an IFA? 

An Individual Flexibility Agreement (IFA) is a written agreement used by employers and employees to alter the effect or application of certain provisions of an award or enterprise agreement. It is an agreement between the employee and employer only and does not have application to all employees. All award, enterprise and other registered agreements are required to have an IFA clause, and if they do not, the model clause from the Fair Work Regulations 2009 will apply. The Victorian Catholic Education Multi-Enterprise Agreement 2018 contains that clause (clause 10).

How are they created?

An IFA may be created at the suggestion of either the employer or an employee but both parties must agree to it. Either party can refuse an IFA. Notably, employees are protected under their general protections and so cannot be discriminated against or treated adversely for refusing to sign an IFA.

Despite being a binding arrangement, an IFA may be ended if any of these conditions are met:

  • The party wishing to terminate the agreement has given required notice (28 days’ notice to end an IFA made under a registered agreement); or
  • Both parties have agreed to the conclusion of the IFA and signed a release to that end; or
  • A date specified in the IFA is reached; or
  • A new agreement replaces the IFA.

What are the requirements of an IFA?

To be effective, an IFA must be in writing and signed by both parties. It is a binding legal agreement between the parties. However, it does not have to be approved or registered with the Fair Work Commission.

The IFA must set out:

  • The identity of both parties
  • When the IFA commences
  • Any and all terms in the enterprise agreement which will be altered by the IFA
  • how the employee is better off as a result of the IFA

An IFA must also:

  • Only include lawful terms
  • Be freely agreed upon by employer and employee
  • Be provided to the employee within 14 days after it is signed
Any IFA must satisfy the ‘better off overall test’. This means that the employee entering into the IFA must be better off after the commencement of the IFA than before it. Employers are responsible for ensuring the employee is better off and may take into account any financial and non-financial impacts to the employee, as well as the employee’s individual circumstances.
What are the obligations on an employer when an employee requests an IFA?
When an employee requests an IFA, the employer must:
  1. Ensure that the employee meets the ‘better off overall test’.
  2. Ensure that the employee is acting on free will and has not been coerced or pressured into the IFA.
  3. Give the employee a proposed IFA in written format and allow them  reasonable time to consider it and raise any questions.

Case Example

We have recently worked closely with a school principal to negotiate and draft an IFA  with two employees relating to their maternity/paternity leave. In this situation, the  employees were spouses and were expecting their first child. The maternal employee was a senior teacher and did not want to take her full leave entitlements. The employees instead wanted the paternal employee to undertake the stay at home care of the child and as such sought to amend their leave entitlements under the VCEMEA. Brennan Law Partners supported the principal in negotiating this IFA so as to ensure the staff members were “better off overall” whilst ensuring that the school was protected.

How can Brennan Law Partners assist?

IFAs can be used for various situations and to meet various needs of both employees and employers. Brennan Law Partners can assist you in advising, drafting and negotiating an IFA. We are also here to support you in answering any questions you may have. Contact us to discuss your particular situation or to discuss an IFA request of an employee.
If you have any questions regarding any information in this BLP Brief, we welcome you to contact us at any time.

This is meant as a guide only and should not be taken as legal advice.

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