Substantial changes to Modern Awards fast approaching
For complete compliance, employers should be aware of impending changes which could significantly affect current, accepted workplace practices, including payments of salaries. As the awards undergo changes, the Victorian Chamber will be providing timely updates to members. Award specific information will be supplied to award subscribers as and when Commission determinations are released.
In 2014 the Fair Work Commission (the “Commission”) commenced the 4 year review of the Modern Award system as required under the Fair Work Act (2009). These proceedings are now drawing to a close meaning changes are imminent. The Modern Awards have already undergone changes including:
|Change||Date of introduction|
|Directions to take annual leave and cashing out leave||6 April 2018|
|Family and domestic violence leave||1 August 2018|
|Casual conversion||1 October 2018|
|Minimum engagement for casual staff||1 October 2018|
|Requirement to pay entitlements on termination within 7 days||1 November 2018|
|Requests for flexible work arrangements||1 December 2018|
|Abandonment of employment clauses removed from relevant awards||20 December 2018|
Further changes will be introduced to your Modern Award over the coming months and throughout 2020. Award specific reviews are well underway, with drafts having been provisionally published by the Commission. The changes include structural amendments as well as substantive matters under certain clauses.
There have also been common issues affecting numerous awards identified. These include:
- Annualised salary arrangements
In February 2018 the Commission commenced a review of the annualised salary provisions in awards. A number of model clauses were proposed and are still under review as outlined in the following decision.
The model clauses will be imposing stricter compliance requirements including keeping records of the “outer limits” of overtime absorbed into the salary, recording which award clauses are satisfied by the salary, rectifying shortfalls between the salary and award entitlements within 14 days and keeping a written agreement with the employee for the salary being entered into.
- Overtime for casuals
The Commission has identified a number of awards containing ambiguity around casual employees and payment for overtime. The ambiguity has been identified in the following areas for various modern awards:
- whether casual employees had any entitlement to overtime rates;
- the circumstances in which overtime rates were payable to casual employees; or
- the rate at which the overtime rate was payable to casual employees (including whether the casual loading was payable in addition to the overtime rates and, if it was, whether it was added on a cumulative or compounding basis).
It is expected as the re-drafted awards are finalised the casual overtime clauses will be addressed. The status of this issue is outlined in the following Commission decision with further decisions expected.
What should employers do?
- Employers should continue to seek advice to ensure compliance with your applicable Modern Awards.
- As the awards undergo changes the Victorian Chamber will be providing frequent updates to members. Award specific information will be supplied to award subscribers as Commission determinations are released.
- To access additional Workplace Relations Tools and Templates and Modern Award directory click here.
- For further information relating to the changes or to subscribe to your applicable modern award contact the Workplace Relations Advice Line on 8662 5222.
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