The Fair Work Commission has announced steps that an employer may need to take to ensure against potential underpayments to employees when paid an annual salary under certain Modern Awards (see which Awards below). This is because extra hours people are working (potentially weekend and overtime) are possibly not being taken into consideration.
The new rules start from the first full pay period on or after 1 March 2020. (So for example, an employee whose fortnightly pay was Thursday, 27 February 2020, these rules would apply from next pay, Thursday, 12 March 2020).
What this means for you:
- For each employee on an annual salary, you will need to confirm:
- a) Which Award they fall under
- b) What level that they are classified
- Begin tracking shift start, break start, break end and shift end times for all employees affected.
- Update your employment contracts to outline details of the annualised agreement.
- On each 12 month anniversary and on termination of employment, for each employee you will need to calculate any discrepancy between what was paid and what would have been paid if the employee was on an hourly rate.
You are not obliged to follow annualised salaries if you have certain contractual arrangements with individual employees. However, to be legally effective, these provisions must be appropriately outlined in contracts and statutory record-keeping obligations must still be adhered to.
HR Central can support you with:
- Classification of the appropriate award and level for your staff.
- Review and amend your contracts accordingly.
- Help with the 12 month anniversary or termination of employment calculations.
- PLUS provide you with our easy to use time-logging solution (more on that on Monday!)
Awards that this applies to:
Banking, Finance and Insurance Award 2010 Broadcasting and Recorded Entertainment Award 2010
Clerks – Private Sector Award 2010
Contract Call Centres Award 2010 Hospitality Industry (General) Award 2010
Hydrocarbons Industry (Upstream) Award 2010
Legal Services Award 2010
Local Government Industry Award 2010
Manufacturing and Associated Industries and Occupations Award 2010
Marine Towage Award 2010
Mining Industry Award 2010
Oil Refining and Manufacturing Award 2010
Pharmacy Industry Award 2010
Rail Industry Award 2010
Restaurant Industry Award 2010
Salt Industry Award 2010
Telecommunications Services Award 2010
Water Industry Award 2010
Wool Storage, Sampling and Testing Award 2010