From 1 January 2010 there are several important changes in Australia’s workplace laws that affect all employers and employees in the national workplace relations system. These may affect the minimum pay and conditions for your employees.
- From 1 January 2010, modern awards cover most workplaces. The commencement of modern awards means that there have been changes to minimum terms and conditions for many employees. The changes vary by state, industry and employer.
Transitional arrangements in most modern awards mean that some new pay rates commence on the first full pay period on or after 1 July 2010. This means that pay rates of pay for many employees change on 1 July 2010.
Transitional arrangements in most modern awards give employers and employees time to adjust to the changes by allowing new pay rates to be phased in over a period of four years until the full modern award rates apply on 1 July 2014.
In this period pay rates need to be calculated with reference to the pre-modern award entitlement that used to cover the employee before 1 January 2010 as well as the relevant modern award entitlement.
The Fair Work Ombudsman has a number of tools to assist you find your right rate of pay.
- If an employee does not have an award or award or agreement that covers them, then they will generally be covered by the national minimum wage. The national minimum wage is set by Fair Work Australia, with the first decision to take effect from the first full pay period on or after 1 July 2010. Until 1 July 2010, employees who are not covered by a modern award will continue to be paid at the existing Federal Minimum Wage rate of $543.78 per week or $14.31 per hour (before tax).
- The National Employment Standards (NES) replace the non-pay rate provisions of the Australian Fair Pay and Conditions Standard (the Standard). The NES provide a set of 10 minimum entitlements for employees in the national workplace relations system from 1 January 2010.
Together, modern awards along with the NES and the national minimum wage form a new safety net for employees in the national workplace relations system.
- Sole traders, partnerships and other unincorporated private sector employers in New South Wales, Queensland, South Australia and Tasmania join the national workplace relations system from 1 January 2010. State awards and employment agreements will continue to apply for a period of time, however employers must ensure that that their State award or employment agreement meets certain minimum ‘safety net’ entitlements.
State awards will continue to apply until 31 December 2010, after which employees will be covered by the relevant Modern Award. Employees under State awards must receive conditions that are at least equal to the minimum entitlements in the NES and the national minimum wage.
State employment agreements will continue to apply until terminated by Fair Work Australia or replaced with an Enterprise Agreement or Workplace Determination made under the Fair Work Act. Employees under State employment agreements must receive conditions that are at least equal to the minimum entitlements in the NES and the base rates of pay in an applicable State award (while operative), or the relevant modern award or, if there is none, the national minimum wage.
Modern awards, together with the NES and the national minimum wage form a new safety net for employees in the national workplace relations system.
Minimum pay rates
Australia's minimum wage is $15.00 per hour or $569.90 per week.
However, most employees are covered by a base rate of pay in a modern award, pre-modern award or an agreement. If nothing else applies to you, then you may be covered by the national minimum wage.
You must pay the correct rate of pay for all hours your employees have to be at work, including for work meetings and training.
Employees may also be entitled to other allowances or loadings, depending on what job they do. For example, casuals are entitled to a casual loading.
You must also pay your employees regularly and issue a pay slip within 1 day of pay day.
Leave entitlements
Under the NES, full-time and part-time employees are generally entitled to paid personal/carer’s leave and compassionate leave, annual leave, parental leave and related entitlements and community service leave.
Casual employees are not entitled to paid personal leave or annual leave, but are entitled to unpaid carer's leave, compassionate leave and community service leave.
Maximum working hours
Under the NES, agreement and award free employees can't generally be asked to work more than 38 hours per week (which can be averaged over a maximum of 26 weeks if agreed in writing). Employers can ask employees to work reasonable additional hours.
Public holidays
For most employees, the right not to work on public holidays is protected under national workplace relations laws.
You may ask your employee to work on a public holiday; however, your employee can refuse and take the day off if there are reasonable grounds for doing so.