On the 12th of December 2017, the Fair Work Commission announced that they will introducing certain changes to the overtime rates and shift entitlements for casual and part-time employees in some awards.
These changes will apply from the 1st of January 2018 onwards and have been explained below.
As a reminder a casual employee is an employee that:
- has no guaranteed hours of work;
- doesn’t receive paid sick or annual leave entitlements;
- receives a casual loading (a higher hourly pay rate), in lieu of not receiving any leave; entitlements; and
- typically works irregular hours (but can work regular hours).
Whereas, a part time employee is an employee that:
- works, on average, less than 38 hours per week;
- usually works regular hours each week (now changed to ‘guaranteed hours’)
- is entitled to the same benefits as a full-time employee, but on a pro-rata basis; and
- is a permanent employee or is on a fixed term contract.
Overtime provisions for Casual Employees
The overtime provision in a number of Modern Awards has been altered so that casual employees are now entitled to receive overtime penalty rates, just like full time and part time employees.
Casual employees within the affected awards will now be entitled to overtime rates for each hour worked in excess of the ordinary hours either in a day or week. Furthermore, in some cases a casual may also be entitled to overtime rates, if they work outside of the span of ordinary hours.
Casual employees receive a higher hourly pay rate than full-time and part-time employees. This is called a ‘casual loading’ and is paid to these employee as they don’t receive benefits such as sick or annual leave. When calculating overtime rates for casual employees, the employees base rate should be used (not including the casual loading). Therefore, overtime rates for full-time, part-time and casual employees at the same level, would be the same rate.
These changes will apply to the following Modern Awards:
- Fast Food Award 2010
- General Retail Industry Award 2010
- Hair and Beauty Industry Award 2010
- Hospitality Industry (General) Award 2010
- Registered and Licensed Clubs Award 2010
- Restaurant Industry Award 2010
Increased Flexibility for Part-Time Rostering
In addition to the changes to overtime provisions for casual employees, the Fair Work Commission has also varied some of the provisions for part-time employees.
These changes allow for greater flexibility in rostering of working hours. Part-time employees will now have ‘guaranteed hours’, per roster cycle or week. This means that instead of providing set shifts per week or roster cycle the employer may instead provide a guaranteed number of hours per week which may be provided during different days or time each rostering period.
As a result, part-time employees will need to provide their employer with their hours of availability so that the employer has the flexibility to roster employees within that availability.
In the case of a part-time employee having worked regular hours for a period of more than 12 months, the employee may also request to increase their guaranteed hours. Employers are allowed to deny this request, but only on reasonable business grounds.
These changes will affect the following Modern Awards:
- Hospitality Industry (General) Award 2010
- Registered and Licensed Clubs Award 2010
- Restaurant Industry Award 2010
If you have employees covered by any of the above awards, and if you have any further questions or concerns, please contact HR Central at 1300 717 721.