In general the law considers any form of industrial action to be unlawful, however, unions or employees who are negotiating a CA may engage in limited industrial action in support of their claims, without attracting civil liability or risking dismissal. Industrial action can only be undertaken during bargaining and is 'protected action'. It may include strikes by employees or lockouts by employers.

Parties must make a genuine attempt to negotiate before resorting to protected action and the action must be properly authorised through a secret ballot and subject to notice. Industrial action taken outside the bargaining period attracts severe penalties. Either a union, an employee or an employer can initiate a 'bargaining period' by giving written notice of their intention to negotiate an agreement. The bargaining period starts seven days after notice has been issued and stops when an agreement is made or by an order from the AIRC.

In these circumstances, there can be no legal action against those taking industrial action. It is unlawful for an employer to dismiss an employee for taking protected industrial action. It is also unlawful for an employer (or employee) to apply duress or to make false or misleading statements to persuade a person to enter into or not to enter into an AWA, or to use threats or intimidation to hinder negotiations.

Opportunities for protected action have been reduced by the Workplace Relations Act 1996 (Cth) and the penalties for unprotected action have been significantly increased. The International Labour Organisation has issued several reports expressing reservations about Australia’s compliance with international standards in relation to industrial action. Now that the law has been tightened further this concern will no doubt continue.