With many businesses in partial hibernation due to the impact of COVID-19, it is a good time for employers to review changes to the modern awards that might affect their business.
In this update we highlight recent important changes to modern awards and encourage employers to use this time to ensure their understanding of these changes to ensure compliance moving forward.
Award Annualised Wage Provisions
On 12 February 2020 the Fair Work Commission varied 18 modern awards to add provisions or change existing award provisions, regarding annualised wage arrangements.
The provisions affect full-time employees currently paid an annual wage. The provisions do not apply to part-time and casual employees under these awards.
Changes to these awards took effect from 1 March 2020. The changes will also apply to a further 4 awards on a date yet to be determined.
Employers must diligently review their awards and update employment contracts to ensure compliance with these new provisions. There are also significant implications for the administration of payroll to meet compliance and auditing obligations where full-time employees are employed on annualised wage arrangements.
See our alert here for more detailed information and a list of the awards that have been varied to include the new annualised wage provisions.
Note, the annualised wage provisions are expressed differently between the awards, so it is important for employers to review the provision under their relevant award.
Ongoing 4-yearly review of awards
The Fair Work Commission is continuing to extensively vary awards as part of its 4-yearly review of modern awards (‘4-yearly review’). The 4-year review process is scheduled to conclude later this year.
The current 4-yearly review has been split into 3 tranches (groups). Changes to tranche 1, comprising 30 modern awards was completed and became operative from the first full pay period on or after 4 February 2020.
Changes to tranche 2, comprising 39 modern awards come into operation in two stages; being 13 April for uncontested awards and 4 May 2020 for contested awards.
Changes to tranche 3, comprising all remaining awards, are yet to be finalised, but are forecast to become operative later in the year.
On conclusion of the 4-yearly review all modern awards will contain the following provisions:
- Family and domestic violence leave;
- Requests for flexible working arrangements; and
- Requirement to pay entitlements on termination within 7 days.
All modern awards not already containing the following provisions will be amended to include:
- Minimum engagement provisions for casual staff; and
- Casual conversion clause.
Employers should review the awards applicable to their business to ensure they remain compliant with recent changes. Aitken Legal has posted updates regarding changes to specific awards here.
A full list of modern awards can be accessed on the Fair Work Commission’s website here.
Note, awards that have completed the 4-yearly review are identified by the year ‘2020’ in their title. Awards due to become operative on 4 May 2020 may be reviewed under the ‘future award’ link. We note that the Commission is currently receiving submissions in relation to the final group of awards (tranche 3).
All Employers Beware: Changes to the Miscellaneous Award
On 25 March 2020, the Fair Work Commission significantly increased the scope of employees who may be covered by the Miscellaneous Award 2010, by removing previously outlined exclusions in the coverage clause of the award. These changes are due to take effect from 1 July 2020.
Aitken Legal will prepare an alert regarding possible implications for employers who currently have award-free employees, as it is possible that a wide selection of award-free employees may be captured by the Miscellaneous Award following these changes.
Aitken Legal will continue to provide employers with general updates and alerts about changes to Award. However, given the extent of recent changes to modern awards, employers must pro-actively review their relevant awards. Employers are also reminded of their obligation to ensure a current version of the award is accessible at the workplace.
Contact us for assistance
Employers are encouraged to contact Aitken Legal for assistance with general award compliance and to explore temporary flexibility measures that may be available under your award to assist with challenges faced during COVID-19.
Aitken Legal also has a designated COVID-19 page where employers can find all the latest information relevant to their obligations during the COVID-19 pandemic. For more information click here.
Disclaimer: The information contained this article is general and intended as a guide only. Professional advice should be sought before applying any of the information to particular circumstances. While every reasonable care has been taken in the preparation of this update, Aitken Legal does not accept liability for any errors it may contain. Liability limited by a scheme approved under professional standards legislation.