See Fair Work Act 2009 ss.190–191
Where the Fair Work Commission has a concern that an enterprise agreement does not meet the requirements of ss.186 and 187 of the Fair Work Act (which include the better off overall test), the Commission may accept a written undertaking that meets this concern and approve the agreement.
Before accepting an undertaking, the Commission must:
An undertaking relating to an enterprise agreement must be signed by each employer who gives the undertaking.
A residual discretion remains to be exercised even if the undertaking that has been accepted meets the identified concern.
If an undertaking is accepted, the terms of the undertaking are taken to be a term of the agreement.
An undertaking that is expressed as varying a particular provision in an enterprise agreement should be taken to be a promise by the employer that the provision will not be applied and the term as set out in the undertaking will be.
An undertaking can only be accepted where there is a concern under ss.186 and 187; not to address other deficiencies.
'Section 190(3) does not permit undertakings that result in the wholesale reshaping of the agreement, such that it bears no resemblance to the pre-undertaking agreement that was approved by employees.'
The Commission cannot accept an undertaking to correct deficiencies of a flexibility term or a consultation term because they are not concerns about matters in s.186 and s.187 of the Fair Work Act.
If the Commission has any concerns with these then the model clauses will be inserted.
The process for offering and accepting undertakings, assessing whether an accepted undertaking meets the requisite concern, and considering whether to approve an enterprise agreement may be summarised as follows:
An undertaking that reduces or removes an employee entitlement in an agreement and consequently be likely to cause financial detriment cannot be accepted by the Commission. This would change the nature of the agreement and may have affected the way the employees chose to vote on it.
An illustrative example is provided in the Explanatory Memorandum:
The EN & EM Surveillance Pty Ltd Enterprise Agreement 2011 covers 800 employees working in a local security business. The Commission has a concern that the agreement may not pass the better off overall test for a group of 80 employees employed under the classification of Static Guard. The agreement would pass the better off overall test if the base rate of pay under the agreement was increased by 23 cents per hour. The Commission may accept an undertaking from the employer to pay the additional 23 cents an hour, without putting the agreement out for a further approval process, because it is not likely to cause financial detriment to any employee covered by the agreement, and would not result in substantial changes to the agreement.
The Commission also has a concern that the EN & EM Surveillance Pty Ltd Enterprise Agreement 2011 would not pass the better off overall test for employees employed under the classification of Security Patrol Officers if those employees were rostered to work on Sundays. In this situation, the Commission could not accept an undertaking from the employer that those employees would no longer be required to work on Sundays because such an undertaking is likely to cause financial detriment to those employees as they would lose the opportunity to work on Sundays for penalty rates. This would change the nature of the agreement and may have affected the way the employees chose to vote on it.
The Commission cannot accept an undertaking unless the effect of accepting it is not likely to result in substantial changes to the agreement. This suggests that minor changes to an agreement resulting from an undertaking are permissible.
To view proposed undertakings as a variation to an agreement rather than an undertaking merely because of the expression used in the undertakings is 'to adopt an unnecessarily technical approach to the giving undertakings and is not one that is warranted'.
In the decision Re Hyatt Ground Engineering Pty Ltd  the Commission said:
" The sense in which the word 'substantial' appears in s.190(3)(b) is in my view to describe changes to the agreement as result of undertakings offered where the changes are not 'trivial or minimal' or 'phemeral or nominal'.
 In this sense 'substantial' is not a quantitative term but a qualitative term. A number of trivial or minimal changes to the agreement may not constitute a substantial change to the agreement. However even a single change to a provision of the agreement where the change was not trivial or minimal would constitute a substantial change to the agreement."
 Fair Work Regulations reg 2.07.
 Application by Metropolitan Fire and Emergency Services Board  FWC 106 (Gostencnik DP, 15 January 2019) at para. 26.
 Fair Work Act s.191(2).
 See for example Mondelez Australia Pty Ltd  FWC 2140 (Hatcher VP, 13 April 2018). Note: this issue is currently the subject of legal proceedings before the Federal Court (Mondelez Australia Pty Ltd v AMWU & others (VID 731/2018)).
 Construction, Forestry, Mining and Energy Union v KAEFER Integrated Services Pty Ltd  FWCFB 5630 (Hatcher VP, Colman DP, Harper-Greenwell C, 20 November 2017) at para. 41.
 See for example Re PPG Industries Australia Pty Limited  FWCA 5591 (Lee C, 3 September 2015) at para. 13.
 Explanatory Memorandum to Fair Work Bill 2008 at para. 807.
 Fair Work Act s.190(3)(b).