Share Repurchase And Taxation Among The UK Companies - Free Essay Example

Sample details Pages: 10 Words: 2882 Downloads: 4 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Tags: Taxation Essay Did you like this example? The aim of the research project is to examine the relationship between share repurchase and taxation in the UK companies. Project Objectives To examine the motivations of share repurchase in the United Kingdom. To analyze the recent trend in share repurchases over last 20 decades among UK companies. To explore the relationship between shares repurchase with taxation in the UK companies. To explore the impacts of taxation on share repurchase activity for UK companies Don’t waste time! Our writers will create an original "Share Repurchase And Taxation Among The UK Companies" essay for you Create order Context For decades, most of the corporations are preferred to pay out cash in the form of dividends rather than share repurchases, despite the relative tax advantage of capital gains over ordinary income. In some countries, such as U.S. and UK, companies can buy back their own shares in the stock market, also known as a share repurchase. In the last 20 decades, share buybacks become extremely popular in the United States. According to aggregate data from Compustat, companies announced share repurchases increased from 4.8 percent in 1980 to 41.8 percent in 2000, while dividends only grew at an average annual rate of 6.8 percent (Grullon Ikenberry, 2002). Researchers also found that during 1985 to 1999, corporations in the U.S. announced intentions to repurchase about $750 billion of stock (Vermaelen Rau, 2002). Moreover, studies show that from 1999 to 2000, industrial firms spent more money on share repurchases than on dividend pay out, and that is the first in history, share repurchases programs have become more popular than dividends (Grullon Ikenberry, 2002). What are the reasons for the companies buy back their own shares. Jensen (1986) pointed that firms repurchase stock to distribute excess cash flow. A share repurchase distributes cash to existing shareholders in exchange for a fraction of the firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s outstanding equity. This hypothesis has been supported by Stephens and Weisbachà ¢Ã¢â€š ¬Ã¢â€ž ¢s (1998) study. They found share buy backs have a positive relationship with the level of corporation cash flow. Moreover, they also found a negative relationship between share repurchase and prior stock returns, which means, firm repurchase when their share prices are undervalued in stock market. This theory has been supported by Vermaelenà ¢Ã¢â€š ¬Ã¢â€ž ¢s (1981) study. He found that firms repurchase stock when they are undervalued and have the excess cash to distribution. In later studies, researchers pointed that firms may repurchase stock t o increase their leverage ratio (Opler and Titman, 1996). For the tax perspectives, researchers pointed that tax changes have a major impact on share repurchase. In the UK, companies are sensitive to tax environmental changes. For example, studies shows that in 1994, there were significant increase in the number of open-market stock repurchase programs. This cause by the introduction of tax favored agency share repurchases programs (Vermaelen Rau, 2002). But in 1996, when the tax credit given to tax exempt pension funds in agency buybacks was abolished, the number of the companies announced share repurchase fell significantly. However, in 1997, when all tax credits were abolished, share repurchase became popular again. As some evidence showing above, share repurchase become more popular than any time in the history. Researchers stated that the majority of companies start to use cash payouts to shareholders through share buybacks rather than cash dividend (Grullon Michaely, 2 002). Therefore, it is important to better understand the motivation behind the recent surge in share repurchase activity. Although, share buy backs growing popularity, most of the established studies focus on the U.S. firms. Whether the share buybacks in UK as popular as in the U.S., because the different of tax and regulation systems between this two countries. The aim of the research will not only enhance our understanding of corporation pay out policy but also examine the share repurchases programs under UK taxation system and how this impacts effect on UK companiesà ¢Ã¢â€š ¬Ã¢â€ž ¢ payout strategies. Moreover, the reason for me to focus on the UK companies rather than other EU companies because there have lacks of share repurchase activities in Europe countries. According to the Securities Data Corporation (SDC) reports shows that during 1980 to 1998, there were only 489 stock buybacks announcements made by European companies. And nearly 60% of those announcements were made by the UK companies. There have various reasons for the lack of share buy back activities in EU companies. Firstly, share repurchase is still illegal in some European countries, such as France and Germany. Secondly, some countries proposed specific tax provisions to discourage share buy backs. For example, in Netherland have the high taxes on dividends and low taxes on capital gains. Thirdly, the share repurchase do not fit European company culture. Traditionally, most European companies focus on maximizing stakeholdersà ¢Ã¢â€š ¬Ã¢â€ž ¢ value rather than shareholdersà ¢Ã¢â€š ¬Ã¢â€ž ¢ value (Vermaelen Rau, 2002). Moreover, in European countries the stakeholders (such as managers, banks) prefer to maximize the size of the companies rather than focus on stock prices. They are not interested in share repurchase. Finally, there are little relative studies examine the relationship between share repurchase and taxation with UK companies. Literature Review 4.1 Introduction This search focuses on share repurchase and taxation among UK companies. Bibliographic database used were Business Source Premier (EBSCO), Econo Lit with Full Text (EBSCO), JSTOR Business, Psyc ARTICLES (CSA), Science Direct and Swets Wise. The details of these and full text database were searched in Table 1. The total numbers of retrieved articles were 30. Keywords used were dividend, share repurchase, buybacks, payout policy, dividend policy, taxation and regulation with limited to academic journals and non-academic articles on the last 20 years. Table 1 Database Number of retrieved articles Business Scource Premier (EBSCO) 7 ConoLit with Full Text (EBSCO) 6 JSTOR Business 6 Psyc ARTICLES (CSA) 3 Science Direct 5 Swets Wise 3 4.2 Motivations of share buy backs There are number of reasons a firm repurchase stock. First, Share repurchase could improve the retained profits. Because when companies purchase their own shares, the remaining number of shares left in the public will lower. The reduction of shares in the public means the earning per share will increase even the profits remain the same. So when companyà ¢Ã¢â€š ¬Ã¢â€ž ¢s share price undervalued, repurchasing shares may still result in a strong return on investment. Secondly, firms may use share repurchase announcements to signal the market that their shares are undervalued and the positive stock price reaction at the announcement of share repurchase should correct the misevaluations (Dann, 1981; Vermaelen, 1981). However, Ikenberry, Lakonishok, and Vermaelen (1995) argued that this increase may not be sufficient to correct the misevaluations, particularly in the open market share repurchase- programs. According to Stephens and Weisbachà ¢Ã¢â€š ¬Ã¢â€ž ¢s (1998) study, they inves tigated on 450 open-market share repurchase programs in the U.S. between 1981 and 1990. They found that between 74% and 82% of the shares targeted at the time of announcement are later repurchased and this actual share buybacks are negatively related to stock price performance after the stock repurchase. Thirdly, share repurchase may increase the leverage ratio. The leverage ratio will increase when a firm distributes its capital. Therefore, assuming that an optimal leverage ratio exists, a firm may more likely to buy back their own shares when their leverage ration is below the target ratios (Bagwell Shoven, 1988). Fourthly, companies where there are few opportunities for growth, share repurchase may the possible way to improve the earning per share in order to meet executives or managersà ¢Ã¢â€š ¬Ã¢â€ž ¢ targets. Thus, companies structures may affect their decisions to buy back own shares. Finally, share repurchase make a takeover more expensive. Because share buybacks avoid the accumulated amount of cash in the firm, when a firm with a strong cash position but needs limited spending on capital will accumulate cash on balance sheet, therefore, it make the firm more attractive for takeover. However, recent studies shown share repurchases are only benefit shareholdersà ¢Ã¢â€š ¬Ã¢â€ž ¢ wealth in the short term, but do not add any long term value to the company (Guay and Harford, 2000). Eberhart and Siddique (2003) did a survey based on 7,079 share repurchase programs between 1981 and 1995. The results showed that after the share buybacks, there were a slightly increase in the number of share outstanding. Often the share purchases in the share buybacks programs are used for employee stock options and stock grants. As one article suggested, share repurchases in general are just à ¢Ã¢â€š ¬Ã…“backdoor compensationà ¢Ã¢â€š ¬? for company employees (Henry, 2006:74). 4.3 Taxation with share repurchases Tax changes have a major impact on share repurchase. Study shows that in 1994, there were significant increases in the number of open-market stock repurchasing programs cause by the introduction of tax-favored agency share repurchase programs (Vermaelen Rau, 2002). Grullon and Michaely (2000) also find that the differential tax between capital gains and dividends is a significant determinant of the market reaction to share repurchase announcement. Grullon and Michaely (2002) pointed that in the U.S., corporations start to substitute share repurchases for dividends because capital gains are taxed at more favorable rates than ordinary income. They found that even in 1986, the Tax Reform Act greatly reduced the relative tax advantage of capital gains, but there was still a significant positive difference between the marginal rate on ordinary income and the marginal rate on capital gains. Raghavendra and Vermaelen (2002) studied on the relationship between taxation and share buybac ks among the UK companies. In their studies, the result showed that buyback activity increased significantly when the agency buybacks introduced during 1990 to 1998 in the UK. This consistent with the hypothesis that taxation has a significant effect on share buybacks. Moreover, they also pointed that the ability of pension fund to recover dividend credits has a major impact on the buyback activity in the UK (Raghavendra and Vermaelen, 2002). However, some researchers have argued that taxes alone do not explain the extent of repurchases activity in the U.S. Brav at al (2005) stated that managers view tax considerations as of second important factor in the choice if disbursement mechanism. Ikenberry et al (2004) suggested that since the tax changed in 2003 in the U.S., the dividend had increased significantly. He also pointed that although dividends in the U.S. remain slightly tax disadvantages, that due to the delay of the capital gains by the investors. However, based on the results from research conducted in the U.S., the extent to whether the taxation dominant the managersà ¢Ã¢â€š ¬Ã¢â€ž ¢ decisions announce share repurchase rather than dividends is still an unresolved issue. 4.4 Regulation framework in the UK In order to better understanding the effect between taxation and share repurchase among the UK. It is important to develop our knowledge in the legal and tax frameworks governing U.K. share buybacks, moreover, to recognize the difference between these frameworks and those in the U.S. In The UK, share buybacks allow the company to manipulate its stock price. In order to avoid the share repurchase reduce creditorsà ¢Ã¢â€š ¬Ã¢â€ž ¢ benefits, the Companies Act states that only distributable profits or the proceeds of fresh issue of share can be used to finance the purchase. Moreover, the companies are not allowed to announce share repurchase programs during the period when directors are not allowed to trade in their companyà ¢Ã¢â€š ¬Ã¢â€ž ¢s shares. This means that in the UK, share repurchases are not allowed in the 2 month period preceding the publication of annual earnings. Finally, compare with the U.S., in the UK, share repurchase are much less flexible tool for capital manage ment. All the firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s buy-backed shares may ask to cancelled, because the UK regulators more concerned about the preemption rights of shareholders (Vermaelen Rau, 2002). Not like in the U.S., the regulators more concern about the à ¢Ã¢â€š ¬Ã…“treasury stockà ¢Ã¢â€š ¬?, such as repurchased shares can be re-issued without shareholder approval (Vermaelen Rau, 2002). Conclusion There are various reasons for firms to announced share repurchase, although share buyback activity become extremely popular in the U.S., but the UK repurchase scene is different from the U.S. scene in many respects. Although the UK is the European country where buybacks are most popular, but it is still relatively small numbers of share repurchase programs announced compare with the U.S., where about 100 U.S. firms announce open-market share buybacks each month. However, the UK taxation system may make share repurchase less attractive than they are in the United Stated. What the impact of taxation system on share repurchase announcement among UK companies? How these impacts affect UK companies in last 20 years? Which industry is more likely to announce share repurchase program? The proposed research will review the potential relationship between taxation and share repurchase among UK companies. 5 Research Method 5.1 Desk Based Research The desk based research used to my study. Because desk based research is very useful to get a broad understanding of the topics and is relatively easy to use (Bryman and Bell, 2003). The data usually used in desk based research is referred to as secondary and includes collecting information from third party sources such as company website, magazine articles, books, journals, published statistics and marketing research reports (Collis Hussey, 2003). There are many advantages to using secondary research. This includes the relative ease of access to many sources of secondary data with little or no cost to acquire. The use of secondary research may help researcher to clarify the research question and help align the focus of large scale primary research. However, there are also some disadvantages of using secondary research. Sometimes, secondary data may not presented in a form that exactly meets the researcherà ¢Ã¢â€š ¬Ã¢â€ž ¢s need and the research may not get the full details of th e research to gain the full value of the study. Moreover, with companies competing in fast moving industries, the secondary research may out of date have little or no relevance to the current market situation. 5.2 Reasons of using Desk Based Research There are several reasons for me use desk based research. First, there is a tremendous amount of literature available, but limited studies focus on the taxation and share repurchase among UK companies. Therefore, the desk based research may help me to limit the articles to focus on my research topics. Second, the desk based research may possible to obtain companiesà ¢Ã¢â€š ¬Ã¢â€ž ¢ annual report and account from companiesà ¢Ã¢â€š ¬Ã¢â€ž ¢ websites. Because the UK Companies Act (2006) requires all quoted companies to publish their annual reports available on their website. (CA S430). Finally, in order to explore the relationship between taxation and share repurchase among UK over 20 years. The specific data need to be obtained, such as market-to-book ratio, return in capital employed, equity to debt ratio, market value. All of that information could obtain through on-line data base, such as Data Stream, which can be used in Aston Universityà ¢Ã¢â€š ¬Ã¢â€ž ¢s library. Howeve r, some of the information may out of date or the results may not be directly related to UK companiesà ¢Ã¢â€š ¬Ã¢â€ž ¢ situation. And the amounts of information available may be very limited. Also, due to the lack of study on relationship between taxation and share buybacks under UK taxation system, it is difficult to find sufficient sources from limited useful information. 5.3 Sample Section and Analysis Method The company shares repurchase announcement information been collected between 1 January 1999 and 31 December 2009. The information obtained from various ways, including London Stock Exchange (LSE) online service, UK-wire Company Announcement service, news articles from the Financial Times. The independent variables of stock returns and data have been provided by DataStream. Moreover, the data and sample had to satisfy the following criteria: The repurchase must exclusively be ordinary shares The firms is listed in the UK Repurchases announced during the last quarter of 2001 are excluded to dampen the volatility effects of 11 September 2001. Only the first announcement of share repurchase programme is included. The sample includes all open market share repurchases, private repurchases Descriptive statistics of the repurchases and independent variables used in this study to summarize and organize the companies repurchase data. Then, the main tax regimes divided i nto four equal periods during the sample period. The repurchases announcement data will be analyzed into the four tax periods. The correlation matrix on the variables will be needed to analyze whether there is the correlation between companyà ¢Ã¢â€š ¬Ã¢â€ž ¢s stock returns and share repurchase. Finally, the result will be interpreted and presented. Ethical issues The following ethical issues will be conducted with this research: Recode the data and results accurately Follow the Aston University rules on plagiarism Describe and discuss the research result objectively Task List Task Problems Solutions Obtain journals and literatures about firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ dividend policies, share repurchase and taxation Tremendous amount of literature need to reviewed Limit search to articles that study on share repurchase within UK companies Obtain the information about the firms announced share repurchase programs within the UK for last 20 years Relatively small data need collect from numerous information Limit the research to companies announced share buybacks listed by data stream between 1989 and 2009 in the UK Create a list of relative UK companies Which company should include The company announced share repurchase over million Obtain the information about taxation and regulation changes over last 20 years in the UK A lot literatures need to reviewed Limit search to articles about taxation and regulation changes in last 20 years Find the impact of taxation change for share repurchases activity A limit studies/result on this area, especially for UK companies. Analyze the data on my own, use the statistical methods to explore the relationship between taxation and firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ payout policies. Write up report Easy to exceed 15000 word limit Work with supervisor to only include the most relevant information Review the dissertation before the submit it Easy to make some grammar, spelling mistakes. Ask my friend read it, see whether the dissertation make sense for them. Help me to find the grammar mistake.

By Jove A Brief Look at Polytheistic Divine Command Theory

Sophocles’ famous play â€Å"Antigone† highlights a problem in what was then the prevalent worldview for most pious Greeks, that of Divine Command Theory. Divine Command Theory is a philosophical paradigm, or worldview, which essentially states that an action is good if and only if it has been commanded by a divine entity, which, to quote St. Thomas Aquinas, â€Å"all men know as God.† The problem arises in what happens when there exist multiple deities, such as is the case with the Greek and Roman pantheons. Socrates himself argues about this in the famous work Euthyphro, underscoring the fact that this is a problem which has been around for a very long time. It would seem that the existence of multiple deities destroys the possibility of there being a coherent system of morality. What, for example, would be the course of action if one god were to prefer one action which is opposed to another action preferred by a different god? In the Greek mythology which serv es as something of a backdrop for Antigone, it was not at all uncommon for the Olympian deities to be at odds with each other about this or that thing, or even outright conflict. Another problem raised by a polytheistic Divine Command Theory is the question â€Å"Do the gods command an action because it’s morally right, or is it morally right because the gods command it?† The polytheists must by necessity choose the first option, for reasons that will be explained later in the paper. This paper will take the position that the

Role of the Fair Work Commission Dispute Resolution

Question: Discuss about the Role of the Fair Work Commission for Dispute Resolution. Answer: Introduction In Australia, any employer must be informed of the existing bodies and groups that handle the work for the good of the Australian workers. The Fair Work Commission is one of the bodies that work for the employees benefit. The national tribunal involved in handling workplace relations is the Fair Work Commission (FWC) (Fair Work Australia, 2010). This commission has the power to conduct a range of functions regarding workers independently. As a party that works for interest of Australias workforce, it services different functions such as enterprise bargaining, dispute resolution, industrial action, termination of employment, and enforcing the safety net of minimum wages and employment conditions (Employsure, 2017, par. 1). Although the FWC is an independent body, it has the statutory powers established under the Fair Work Act 2009. In fact, it has to operate like the Australian court in handling various workplace matters (Stewart, 2011). Commonwealth of Australia (2008) noted that the commission has the powers to hear disputes and claims related to the employment and deliver a binding sentence that the parties involved must respect. Without a doubt, it might appear that the tribunal was established purely to support and protect the employees (Creighton Stewart, 2010). Conversely, this commission has the primary responsibility and objective to assisting employers and employees in maintaining productive and fair workplaces. Given the significance of the FWC in Australia, this article intends to define its roles in making and approving agreements. The Fair Work Commission The FWC is the eye and protector of employees and its roles are varied but within the scope of workplace relations. Most important, this commission must approve enterprise agreements, set the Australias national minimum wages, resolve disputes defined under the National Employment Standards, agreements, or awards (Cane McDonald, 2008). The law also allows it to act as an arbiter in disputes relating to adverse actions and unfair dismissal. At the same time, the commission has to create and change modern awards to fit the situation and circumstances at work. How does the FWC make and approve agreements? For employees, the worst and the lowest moment is when an employer unfairly dismisses him or her. This depressing situation requires proper handling. The FWC (2016) offers the employees an opportunity to raise such issues because it has the statutory powers to determine an award. Based on the circumstance, the FWC can act on an unfair dismissal by considering financial compensation or reinstatement (Stewart, 2011). However, for the commission to act on such weighty issues, the employee must follow the stipulated procedures in the Fair Work Act 2009 that requires such a person to lodge a formal complaint and stipulate the reasoning. Fair Work Ombudsman (n.d) allows the employee to cite the reasons for believing it was a unfair dismissal, victimized, discriminated against, bullied at work thus seek an order to prevent the recurrence of the situation. Upon the completion of the application, the employee should submit to the commission for assessment and forward the document to the company or employer requesting for responses (Creighton Stewart, 2010). These activities form the basis for the mediation process. The subsequent steps will be determined by the severity of the complaint and the response of the employer. Unfair Dismissals The Fair Work Commission receives over forty percent of complaints relating to unfair dismissals (Acton, 2010). According to the FWC (2017), unfair dismissal is borders on unreasonable, unjust, or harsh sacking of a worker. In most cases, the employees consider nearly all the dismissals as unfair. Nevertheless, the FWC defines it different and conduct independent assessments to verify the situation. Apart from assessing the fairness question, the commission also looks at how such dismissals were undertaken. This does not mean that employers can never dismiss workers, but they have to use fair procedures. For the Commission to determine the procedural fairness, it uses three determinants. Fair Work Ombudsman (n.d) maintains it has to consider whether the allegations were put to the employee detailing the reasons, whether the worker was given appropriate time to respond, and whether the worker failed to respond or responded but his accounts were never considered before the fateful term ination. Making an Agreement Enterprise agreements for the basis of any collective agreements that employers and employees make at an enterprise level regarding the employment terms and conditions (Commonwealth of Australia, 2008). The FWC (2017) provides the guidelines and information about the agreement making process. It has the mandate to assess and approve the enterprise agreements. The commission also handles the disputes arising from the terms of agreements. According to FWA (2010), an enterprise agreement is made between employers and employees through their representatives. For example, in the Greenfield agreements, the employer has to negotiate with organizations or unions to reach the agreements about the employment terms. Australian Government (2016) argues that an enterprise agreement covers the modern awards that offer safety net relating to employment conditions and the minimum pays rates. The agreement also contains wages deductions, pay rates, consultative mechanisms, procedures for dispute reso lutions, and employment condition like meal breaks, working hours, and overtime. The law prohibits the inclusion of unlawful clauses including objectionable and discriminatory terms in the agreement. The bargaining agreement is a time-consuming and stressful process for employers. Sometimes the employees favours a proposal that grants them benefits thus deny the employer a breathing space. Before the approval of such an agreement, the FWC has the responsibility of satisfying (Creighton Stewart, 2010) that the agreement meets the requirements. Sometimes the employers and employees may support the agreements; there could be errors that can prove fatal. Therefore, the commission must check all the grey areas before the adoption. Based on the recent case of CEPU v. Mirait Technologies Australia Pty Ltd (C2015/4054), the firm questioned the decision of this commission in approving the Mirait technologies agreement. The Union contested why the commission approved the agreement because the parties (Russell Kennedy, 2015) had not agreed the enterprise agreement. It was apparent that the majority of the employees approved the document. Unfortunately, Mirait Technologies had submitted two statutory declarations in support of the proposed agreement that were inconsistent (Russell Kennedy, 2015, par. 3). The court identified the inconsistencies and raised eyebrows how the workers approved the statutory before voting. Because of the Miraits appeal, the company would have an opportunity to vote for the proposed agreement. Based on this case, it was evident that the employer attempted to use an external advisor without the expertise to negotiate and adopt this agreement with the employees directly. The law requires the commission to assist these employers, especially following the commissions move to reject the enterprise agreements. Under the FWA 2009 (Cth), any employer-employee agreement should not contain clauses contravening the requirements thus make the agreement unable to meet the overall test (FWC, 2016). The failure by the employer to com plete and submit the agreement or failure to take necessary actions regarding the pre-approval steps as required within a given timeframe. In case of any rejection, the employer has to start the process again thus expose such a stakeholder into a time-consuming, frustrating, and embarrassing task (Hannan, 2017). Businesses experiencing industrial actions can allow the union representatives to renegotiate the rejected agreement and address the contentious clauses. This rejection confirms that employers must follow the due procedures before submitting an enterprise agreement. Russell Kennedy (2015) recommends that the employers needs to consider professional advice when negotiating the agreement with unions or employees directly. Based on this litigation, it is arguable that the FWC plays a critical role in making an agreement based on the laid down procedures. Approving an Agreement The employers who opt to use the enterprise agreement must consider the FWCs approval. This will facilitate the registration of the agreement with the employees. The Fair Work Commission expects the employer to put in places the bargaining representatives that would champion for the employers rights. The organization can also appoint a competent person to handle the situation in writing (Creighton Stewart, 2010). The FWC expects the employees also to have the representatives such as the union. These two parties must agree on the terms of employment to pave way for either party to apply for the FWCs approval. This should be within 14 days after the parties have made the agreement. Under the Fair Work Act, there should be specific clauses to accommodate in the agreement that will make it a complete declaration. Both the parties should have the copies completed and signed by the parties. There should be three original copies that the FWC can give any representative after the approval through emails or any other media. The final step will involve the approval of this agreement (Australian Government, 2016). The FWC has to assess the agreement to ensure it captures all the requirements. For instance, the enterprise agreement needs to consider the dispute resolutions mechanisms, whether it was genuinely agreed, better off overall tests, based on good faith, adheres to the national employment standards, the fair coverage of employees scope, and ensures that employees have not been threatened or coerced into making the agreement. However, in case of any questions, the commission has to seek audience with the parties by attending hearings thus facilitate the approval of the agreement. Based on the statute, the Commission can approve it after 50 days (LegalVision, 2015). Conclusion Based on this article, it is evident that making and approving an enterprise agreement is a process that can prove hectic and embarrassing. For example, the employer and employee must agree on the terms of employment for such an agreement to be approved. Under the Fair Work Act 2009, the Fair Work Commission has the responsibility to provide the guidelines on how the parties make the agreement. The article has thus addressed the aspects of making and approving agreements and resolving unfair dismissal issues in the workplace. References Acton, J. (2010 Nov 19). Where Have All The Cases Gone? Voluntary Resolution Of Unfair Dismissal Claims. Australian Labour Law Association National Conference, Adelaide. Australian Government. (2016, Nov 17). Fair Work Act 2009. Retrieved from https://www.legislation.gov.au/Details/C2016C01108 Cane, P., McDonald, L. (2008). Principles of Administrative Law: Legal Regulation of Governance. Melbourne: Oxford University Press. Commonwealth of Australia. (2008). Fair Work Bill 2009. Explanatory Memoranda. Retrieved from https://www.austlii.edu.au/au/legis/cth/bill_em/fwb2009124/memo_0.html Creighton, B., Stewart, A. (2010). Labour Law, Fifth Ed. Sydney: Federation Press. Employsure. (2017). The Fair Work Commission. Retrieved from https://employsure.com.au/guides/fair-work-australia/fair-work-commission/ Fair Work Australia (FWA). (2010). Annual Report of Fair Work Australia 1 July 2009-30 June 2010. Melbourne: Fair Work Australia. Fair Work Ombudsman. (n.d). Agreements. Retrieved from https://www.fairwork.gov.au/awards-and-agreements/agreements FWC. (2016, Dec 29). Make an Agreement. Retrieved from https://www.fwc.gov.au/awards-and-agreements/agreements/make-agreement FWC. (2017, April 3). Enterprise Bargaining. Retrieved from https://www.fwc.gov.au/awards-and-agreements/agreements/about-agreements/enterprise-bargaining Hannan, E. (2017, Feb 8). Fair Work Commission Ruling Opens Way for Back Pay Claim. The Australian. Retrieved from https://www.theaustralian.com.au/national-affairs/industrial-relations/fair-work-commission-ruling-opens-way-for-backpay-claim/news-story/af289ba51619d91f13d0fd49195af521 LegalVision. (2015, Aug 6). How Does the Fair Work Commission Approve an Enterprise Agreement? Retrieved from https://legalvision.com.au/how-does-the-fair-work-commission-approve-an-enterprise-agreement/ Russell Kennedy. (2015, Aug 5). Enterprise Agreements and the Important of Obtaining the Support of the Fair Work Commission (and not just Your Employees). Lexology. Retrieved from https://www.lexology.com/library/detail.aspx?g=7a9162d3-0baf-4c82-9065-50dba3ad238a Stewart, A. (2011). Fair Work Australia: The Commission Reborn. Journal of Industrial Relations, 53(5).