In Australia all workplaces operate under the Fair Work Act 2009. If you are looking at employing staff or already do employ staff, it helps if you understand a bit about the Fair Work Act. Today we are going look at how Fair Work affects you and what the processes are with implementing the Fair Work system into your business.
When I first started my Bookkeeping Business and started doing payroll tasks for my clients, the payroll system was quite confusing. Some clients employed staff under State Awards and Conditions and some employed staff under Federal Awards and Conditions. With the implementation of the Fair Work Act 2009, all businesses who employ staff must employ them under these Federal Awards and Conditions.
In this blog I want to outline for you some of the things that you will need to understand about the Fair Work Act and how you can get more information.
Awards and Agreements
Modern Awards, Registered Agreements or legislation are the main areas where minimum conditions for your staff come from.
Most Small Businesses use awards to cover their business and the work their employees do, therefore the minimum pay and conditions in the award apply to their business. There are 122 industry and occupation awards to cover most Businesses who employ staff in Australia. This means that if your workplace doesn’t have a Registered Agreement, then your staff will most likely be covered by an Award.
Some businesses have Registered Agreements in place and these are what cover the work that the employees do and their minimum pay and conditions in the agreement apply to their business.
If for some reason there is not Award or Registered Agreement, then the minimum pay and conditions in the legislation will apply.
Modern Awards apply to all employees covered by the national workplace relations system. They are industry or occupation-based and apply to employers who perform work covered by the award and their employees. On occasions, Managers or higher income employees may not be covered by a Modern Award, even if an award does exist for that industry.
It is your responsibility as the employer to keep up to date with the Modern Awards and any future changes. It is also a good idea to encourage your staff to keep up to date as well. The best way to keep up to date is by visiting www.fairwork.gov.au regularly.
To find out if your industry has an award the you can visit the Award page at – www.fairwork.gov.au
In some cases, Enterprise Agreements and other Registered Agreements are used to set out the minimum employment conditions for a business. Agreements can apply to one business or a group of businesses.
When a business has a Registered Agreement, the award does not apply, although the National Employment Standards and any terms about outworkers in the award still apply and the pay rate in the agreement can’t be less than the pay rate in the award.
If you would like to make a Registered Agreement then you can go to the Fair Work website – www.fairwork.gov.au and find the information there on how to make the agreement, who can make one, what can it include and what the benefits are for having one.
Award & Agreement free wages and conditions
Most businesses are covered by either an Award or an Agreement, but a small amount of jobs and industries are not and I actually do have a client whose staff are not covered by such.
If your staff are not covered by an Award or Agreement they are considered to be Award and Agreement Free. You may have an Employment Contract for your staff if they fall into this area. Your staff are also covered by the national minimum wage and National Employment Standards.
If you believe your staff are not covered by an Award or an Agreement, then you can go to the Fair Work website and read further about how to implement staff into an Award & Agreement free wage and condition employment. – www.fairwork.gov.au
National Minimum Wage
The Fair Work Commission is responsible for setting and reviewing the minimum wages for employees in the national workplaces relations system. This minimum wage is the base wage that no award, agreement or contract can go under. In other words your staff can not be paid less than the minimum wage set by the Fair Work Commission.
The Commission reviews the minimum wages every year and determines in they need to be increased. If you would like to know more about this process you can go to www.fairwork.gov.au
National Employment Standards
The National Employment Standards (NES) are 10 minimum employment entitlements that have to be provided to all employees.
The National Minimum Wage and the National Employment Standards are what make up the minimum entitlements for employees in Australia. All Awards and Agreements can not provide for conditions that are less than the National Minimum Wage or the National Employment Standards.
There are 10 minimum entitlements of the National Employment Standards:
- Maximum weekly hours
- Request for flexible working arrangements
- Parental leave and related entitlements
- Annual leave
- Personal carers leave and compassionate leave
- Community service leave
- Long service leave
- Public holidays
- Notice of termination and redundancy pay
- Fair Work Information Statement
The National Employment Standards cover all employees in the national work place relations system, regardless of their award, registered agreement or employment contract.
If you employ casuals, then the only National Employment Standards that relate to them are:
- Unpaid carer’s leave
- Unpaid compassionate leave
- Community service leave
- The Fair Work Information Sheet
If your casual staff have been employed longer than 12 months with you then they are also entitled to:
- The right to request for flexible working arrangements
- Access to parental leave
Also, in some states and territories, long serving casuals are entitled to long service leave.
In the next blog I am going to go into more detail around the National Employment Standards as I feel this is something that you really need to understand.
So far in our series you have learnt about the different types of employment and how the Fair Work Act affects you employing staff. If you have any questions around either of these then feel free to email me or contact me on FaceBook or Twitter.