General rule--State-based difference terms must not be included
(1) A modern award must not include terms and conditions of employment ( State-based difference terms ) that:
(a) are determined by reference to State or Territory boundaries; or
(b) are expressed to operate in one or more, but not every, State and Territory.
When State-based difference terms may be included
(2) However, a modern award may include State-based difference terms if the terms were included in the award:
(a) in the award modernisation process; or
(b) in accordance with subsection (3);
but only for up to 5 years starting on the day on which the first modern award that included those terms came into operation.
(a) a modern award includes State-based difference terms as permitted under subsection (2); and
(b) the FWC is making or varying another modern award so that it (rather than the modern award referred to in paragraph (a)) will cover some or all of the classes of employees who are covered by those terms;
the FWC may include those terms in that other modern award. However, the FWC must not extend the coverage of those terms to classes of employees that they did not previously cover.