NFP strategic opportunities: Collective bargaining exemptions

Under Australian consumer law, nonprofits were prohibited from engaging in collective bargaining on behalf of members unless they were granted an authorisation by the Australian Competition and Consumer Commission (ACCC). This legislation aimed to prevent businesses of any size working together to achieve a common commercial goal which was seen as ‘anti-competitive‘, ‘collusive‘, or acting as a ‘cartel‘.

Collective bargaining has most often been seen as industrial representation, in which only registered organisations may participate. More recently however, it has also been associated with commercial negotiations between franchisees and a franchisor, or small businesses and large corporations and service providers.

Now, the federal government has legislated to allow exemptions to the prohibition on collective bargaining by small businesses. The exemption mechanisms are expected to become available early in 2021. Processes for notifying the ACCC of an exemption ‘claim’ are yet to be published, however, these are expected to be simple (a one-page form) and automatic (approved upon lodgment).

This means that associations representing members who own or run small businesses or professional practices can soon offer collective representational services, for example in their members’ dealings with franchise chains and corporate chain owners. This will allow associations to offer the benefit of collective bargaining to members, along with their ‘freedom of association’.

Collectively negotiating terms and conditions on behalf of members is potentially a valuable member service for many Australian associations and charities, which will provide an additional ‘compelling reason to belong’ when promoting membership benefits.

Over the last 20 years, many health practices have become part of franchise chains and corporations, and professional associations representing practice principals and clinicians have been constrained in offering representational service to these members. That now looks set to change.

There may be constitutional issues for your organisation in seeking to include collective bargaining in your service profile, so it would be wise to obtain expert (legal) advice before rushing to do so.

Certainly, there are strategic opportunities for many non-profits when these collective bargaining exemptions take effect, and these should now be explored – along with a thorough risk analysis of course. Structural changes, service agreements, and budget provisions may also require attention in developing any new service offerings.

See also:

ACCC Small Business Collective Bargaining Notification and Authorisation Guidelines (Dec. 2018)

One thought on “NFP strategic opportunities: Collective bargaining exemptions

  1. Professionals Australia was granted special permission to collectively represent interpreters and translators (who are supposedly “independent contractors”) 5 or 6 years ago in negotiations with labour hire companies and other “employers”. It was a temporary arrangement subject to review but I think it is still in place after being renewed. Good to see the practice is spreading.

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