When you create or vary an agreement, the terms must pass the ‘Better Off Overall Test’. Follow these steps so your agreement meets the requirements.
1. Find the award
Find and check the award or awards that covers your industry or occupation.
If you know the name of the relevant award, view our List of awards A to Z.
Not sure which award(s) apply to you? Use the Fair Work Ombudsman’s website to Find the right award.
2. Compare the agreement to the award
Next, you must compare the agreement to the relevant award and identify:
- which terms in the agreement are more beneficial
- which terms in the agreement and less beneficial to an employee
- which award conditions are not in the agreement.
Do not leave out any relevant entitlements
Employers sometimes leave out entitlements that are not relevant at the time they make the agreement.
You must still include or consider all entitlements. If you do not, we may ask you to give an ‘undertaking’ because we must consider all award entitlements, even if you don't use them.
Entitlements that employers often leave out include:
- casual and part-time employment entitlements
- overtime and shift penalties
- rates of pay for juniors and apprentices
- rates of pay under the Supported Wage System.
3. Add details to the employer declaration (Form F17)
After you compare the agreement and the award, you must add details to Form F17. Employers often forget to add this information, which delays the approval process.
Questions in part 2 of the form ask if the agreement, compared with the relevant award(s):
- contains any terms and conditions that are more beneficial
- contains any terms and conditions that are less beneficial
- contains extra benefits that are not in the award
- leaves out any benefits that are in the award
- contains any other different terms or conditions that you have not already described.
If you answer ‘yes’ to any of those questions, you must list the terms and conditions from the award.