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Employment Update – January 2018 – Employer’s Beware: Recent changes to Awards starting 1 January 2018 plus changes to Miscellaneous Award interpretation

Changes to various awards

From 1 January 2018, a number of changes to casual and part-time entitlements in a number of modern awards have taken effect.

Employers who have employees covered by the following awards should review the changes to the awards against their current arrangements:

  • Fast Food Industry Award 2010
  • General Retail Industry Award 2010
  • Hair and Beauty Industry Award 2010
  • Hospitality Industry (General) Award 2010
  • Passenger Vehicle Transportation Award 2010
  • Pastoral Industry Award 2010
  • Rail Industry Award 2010
  • Registered and Licensed Clubs Award 2010
  • Restaurant Industry Award 2010
  • Social, Community, Home Care and Disability Services Industry Award 2010
  • Wine Industry Award 2010

In many of the above Awards (not all), the significant change has been that casual employees will now have a right to overtime rates where they work in excess of ordinary hours, being in excess of 38 hours per week or a set number of hours each day.  Importantly, the changes in each award differ, so it is essential that employees review the arrangements of the relevant Award against their current arrangements.

For part-time employees, the changes provide some more certainty, and in some instances more flexibility in how an employer may roster a part-time employee.  Some of Awards now have provisions that will allow a part-time employee to work differing hours each week over the course of a roster, while some allow the flexibility to roster part-time employees for additional hours without the burden of overtime rates.  Again, each Award should be reviewed individually to determine the extent of any change.

As a guide to the changes (which should certainly not be construed as a replacement to reading the Award itself), the Fair Work Ombudsman have released the following information:

“What are the changes?

Fast Food Award

Casual employees now have an entitlement to overtime pay.

They get overtime when working:

  • more than 38 hours per week, or an average of 38 hours per week over a roster cycle
  • more than 11 hours on any day.

 Hair and Beauty Award

Casual employees now have an entitlement to overtime pay.

They get overtime when working:

  • more than 38 hours per week, or an average of 38 hours per week over a roster cycle
  • more than 10.5 hours per day.

Hospitality Award

Part-time employees

Part-time employees are engaged for a minimum of 8 hours and less/fewer than 38 ordinary hours per week over a roster cycle.

Employers and employees must agree on the minimum number of hours to be worked each week and the times the employee is available to work.

Part-time employees can be rostered for additional hours during their availability period without getting payment for overtime.

A part-time employee who regularly works additional hours for 12 months may ask to increase their guaranteed hours. Employers may only refuse on reasonable business grounds.

Casual employees

Casual employees now have an entitlement to overtime pay.

They get overtime when working:

  • more than 38 hours per week, or an average of 38 hours per week over a roster cycle (which may not exceed 4 weeks)
  • more than 12 hours per day.

Passenger Vehicle Award

School bus drivers transporting students to and from school can be rostered for 1 or 2 shifts per day. Each shift needs to be a minimum of 2 hours.

Pastoral Award

A new 2-hour minimum engagement for dairy operators 18 years or younger who are full-time secondary school students.

Rail Award

Changes to the calculation of overtime, shift penalties and weekend penalties.

Registered Clubs Award

Part-time employees

Part-time employees are engaged for a minimum of 8 hours and less/fewer than 38 ordinary hours per week over a roster cycle.

Employers and employees must agree on the minimum number of hours to be worked each week, and the times the employee is available to work.

Part-time employees can be rostered for additional hours during their availability period without getting payment for overtime.

A part-time employee who regularly works additional hours for 12 months may ask to increase their guaranteed hours. Employers may only refuse on reasonable business grounds.

Casual employees

Casual employees now have an entitlement to overtime pay.

They get overtime when working:

  • more than 38 hours per week, or an average of 38 hours per week over a roster cycle (which may not exceed 4 weeks)
  • more than 12 hours per day or shift.

Casuals may also be entitled to a meal allowance when working overtime.

Restaurant Award

Part-time employees

Part-time employees are engaged for a minimum of 8 hours and less/fewer than 38 ordinary hours per week over a roster cycle.

Employers and employees must agree on the minimum number of hours to be worked each week, and the times the employee is available to work.

Part-time employees can be rostered for additional hours during their availability period without getting payment for overtime.

A part-time employee who regularly works additional hours for 12 months may ask to increase their guaranteed hours. Employers may only refuse on reasonable business grounds.

Casual employees

Casual employees now have an entitlement to overtime pay.

They get overtime when working:

  • more than 38 hours per week, or an average of 38 hours per week over a roster cycle (which may not exceed 4 weeks)
  • more than 12 hours per day or shift.

Casuals may also be entitled to a meal allowance when working overtime.

 Retail Award

Casual employees now have an entitlement to overtime pay.

They get overtime when working:

  • more than 38 hours per week, or an average of 38 hours per week over a roster cycle
  • outside of the span of ordinary hours
  • more than 11 hours on one day of the week, and more than 9 hours on any other day of the week.

Social and Community Services Award

Part-time rosters no longer need to have the same amount of hours in each week. Employees and employers may agree to have a different amount of hours in each week over a roster cycle.

Roster variations can be for short term or permanent changes to the roster.

Wine Award

The minimum payment for casual employees doing pruning or harvesting work during unexpected wet weather has been reduced from 4 hours to 2 hours.”

Aitken Legal stands ready to provide advice regarding the changes and their effects for business operations, as well as advice and guidance on how to implement the changes.  Employers should also consider having their employment contracts with affected employees reviewed for compliance with the changes.

Decision sheds lights on Miscellaneous Award coverage

A recent decision of the Full Bench of the Fair Work Commission has shed some light on the scope of coverage under the Miscellaneous Award 2010 (‘Award’).  The Full Bench’s comments may be cause for some employers to review Award coverage and the employment contracts in their businesses.

Whilst the decision related to an appeal by employee representative United Voice in relation to the Fair Work Commission’s decision to approve an enterprise agreement, which included a finding that no modern Award applied to the relevant employees, the comments of the Full Bench as they relate to coverage under the Miscellaneous Award are instructive to employers.

In considering the decision, it is relevant to note that clauses 4.1 and 4.2 of the Award, which deal with coverage under the Award, say as follows:

“4.1 Subject to clauses 4.2, 4.3, 4.4, 4.5 and 4.6 this award covers employers throughout Australia and their employees in the classifications listed in clause 14—Minimum wages who are not covered by any other modern award.

4.2 The award does not cover those classes of employees who, because of the nature or seniority of their role, have not traditionally been covered by awards including managerial employees and professional employees such as accountants and finance, marketing, legal, human resources, public relations and information technology specialists.”

In this decision, the employer was a ‘pet resort’ who employed people to undertake duties with respect to attending to and caring for the animals housed at the resort.  The employer argued that historically there had been no specific Award coverage for such a position in Queensland.  Whilst the Full Bench accepted that there was no specific coverage in Queensland, it also noted that in other States, there had been historical coverage for similar positions.

The Full Bench then made the following relevant comments:

“[47] Having regard to these fundamental characteristics of the Employees and their work, we do not consider that either of the two conditions for the operation of the exclusion in clause 4.2 is satisfied. First, it cannot be said that work of the class of employees to which the Employees may be characterised as belonging has traditionally not been covered by awards … it is clear that the Victorian Award, the NSW Award and the NT Award all covered the class.

[48] If the relevant class of employees is more widely characterised as that of animal attendants performing basic animal care functions, then the NSW Institutional Award, the WA Award and the Queensland Award also provided relevant coverage in veterinary practices and/or animal welfare institutions. We note that there is comity in the qualification requirements for a Level 3 employee under the WA Award and a Level 3 employee under the Agreement.”

The Full Bench also made some very interesting comments in relation to the seniority of the pet resort employees and that they were employees who were “most suited to award coverage”.

“[49] Second, however the class of employees is characterised, there is no discernible reason based on the nature or seniority of their role why such employees should not traditionally have been covered by the relevant awards. It is plain that the latter consideration of seniority has no relevance, and [the Employer] was unable to identify anything about the nature of their roles which would cause them to be excluded from award coverage. Animal attendants of the type to which the Agreement would apply are, as earlier discussed, lower skilled and modestly or low-paid employees of the type which ordinarily would be most suited to award coverage. There is nothing otherwise unusual about their employment which would render them unsuited to award coverage.”

Aitken Legal’s view as to the commentary in this decision is that it shows a proactive approach by the Fair Work Commission to finding coverage for low skilled and low paid employees under the Miscellaneous Award 2010 where there otherwise might not be coverage under any of the other modern Awards.  Certainly, the decision has made it clear that where an employee was not previously covered by a pre-modern Award in their home State, but there was coverage for the same or similar position in another State, then the Miscellaneous Award might well be in play.

Given this decision, even in circumstances where there was no pre-modern award that provided relevant classifications for the position, if an employer has employees who are low skilled and/or low paid, then consideration should be given to the Miscellaneous Award, even if it is just from a risk management perspective.

Certainly, the Miscellaneous Award still does not cover those managerial positions or professional occupations traditionally excluded from award coverage and as outlined in clause 4.2 of the Award, but following this decision, Aitken Legal considers that particular consideration should be given to coverage under the Miscellaneous Award where employees do not fall within the scope of the exclusion in clause 4.2.

Following this decision, where employers have low paid and/or low skilled staff who they consider are not covered by a modern award, then we would recommend that those employers seek our legal advice regarding potential coverage for those employees under the Miscellaneous Award.  As a guide, we note that the Miscellaneous Award has the following table detailing the minimum wages payable for each classification in the Award:

Classification Minimum wage per week Minimum wage per hour
$ $
Level 1 694.90 18.29
Level 2 742.30 19.53
Level 3 809.10 21.29
Level 4 882.80 23.23

We definitely consider that employers who have been treating employees as Award free and who are being paid hourly rates in the vicinity of those outlined above should definitely seek our advice regarding Award coverage.  Employers should also note that the Miscellaneous Award does contain overtime rates and penalty rates for covered employees, which are not entitlements that are typically bestowed upon Award-free employees, and so employers should consider the underpayment risks that might be present where their Award-free employees are working hours that might attract overtime and/or penalty rates under the Miscellaneous Award.

Lisa Aitken, Managing Director

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