Awards are legal documents that outline the minimum pay rates and conditions of employment. More than 100 industry or occupation awards cover most people who work in Australia. An award is a document that sets out the minimum terms and conditions of employment on top of the National Employment Standards (NES).
Awards provide entitlements such as:
- hours of work
- penalty rates
Who is covered by an award?
Awards are industry or occupation-based and apply to employers and employees who perform work covered by the award. The first step is to go to the list of awards on the Fair Work Commission website to find which award applies https://www.fwc.gov.au/agreements-awards/awards/find-award and locate the name of an award that may apply to the employers business. Then refer to the Scope / Coverage clause in the Award to determine whether the employer is covered by the award (it may require further reference to the award definitions of the industry or workplace). The next step is to go to the classification, usually in the schedule to the award, to determine whether the award covers the employee and, if so, at what classification level. This will also provide the minimum wage to be paid.
When awards don’t apply
An award will outline all the terms and conditions of employment for most employers and employees. If the business is covered by a registered agreement, it is usually the case that the conditions of an award are no longer relevant. However, if the base rates of pay in an agreement are lower than those in the applicable award, the base rates of pay in the modern award will apply.
Managers and higher-income employees are not usually covered by an award, even if one applies to the industry in which they work. When an award does not cover an employee, they are considered award-free. In these situations, the National Minimum Wage and the NES above will form the minimum terms and conditions of employment.
The National Employment Standards (NES) are the minimum standards of employment which cover the following:
- Maximum weekly hours of work– 38 hours per week, plus reasonable additional hours.
- Requests for flexible working arrangements– certain employees can ask to change their working arrangement.
- Parental leave and related entitlements– up to 12 months unpaid leave and the right to ask for an extra 12 months unpaid leave. Also includes adoption-related leave.
- Annual leave– 4 weeks paid leave per year, plus an additional week for some shift workers.
- Personal/carer’s leave, compassionate leave, and family and domestic violence leave– 10 days paid personal/carer’s leave (pro-rata for part-time employees), 2 days unpaid carer’s leave as required, 2 days compassionate leave as required and 5 days unpaid family and domestic violence leave (in a 12-month period).
- Community service leave– unpaid leave for voluntary emergency activities and leave for jury service, with an entitlement to be paid for up to 10 days for jury service.
- Long service leave– paid leave for employees who have been with the same employer for a long time.
- Public holidays– a paid day off on a public holiday (unpaid for casuals), except where reasonably requested to work.
- Notice of termination and redundancy pay– up to 5 weeks’ notice of termination and up to 16 weeks redundancy pay, both based on length of service.
- Provision of a Fair Work Information Statementand the Casual Employment Information Statement – the Fair Work Information Statement must be provided by employers to all new employees. Casual employees must also be given the Casual Employment Information Statement.
- Casual conversion– the right for casual employees to become permanent employees.
AFA Members that have any questions about award coverage can contact employment law specialist Richard Thompson, Principal at Archer Thompson, HERE. AFA Members are not charged for an initial consultation.