Based on what you've told us, it looks like you're covered by the Clerks - Private Sector Award [MA000002].
Employers can pay their full-time employees under an annual wage arrangement. Employers need to make sure their employees annual wage is high enough to cover the award entitlements that they've included in the arrangement, which can include:
- minimum wages
- overtime and penalty rates
- leave loading.
An employee's annual wage can't be less than what they would've been paid over the year if they were paid all of their award entitlements for their work.
Employers can still pay all employees an annual salary without using annual wage arrangements in an award, as long as it covers all of their minimum entitlements. Employers should consider getting independent advice to make sure they're paying their employees enough.
Employers need to record the annual wage arrangement in writing and give their employees a copy. This has to include:
- the annual wage that will be paid
- which award entitlements are included in the annual wage
- how the annual wage has been calculated, including any assumptions used in the calculation
- the maximum (or ‘outer limit’) number of penalty hours and overtime hours the employee can work in a pay period or roster cycle without extra payment.
The employer must also record the employee’s:
- starting and finishing times
- unpaid breaks taken.
Employees have to acknowledge the record of hours they've worked is correct by signing in writing or electronically at the end of every pay period or roster cycle. This record is used for annual reconciliations.
Use our Annualised wage arrangement template to record the details of your annual wage arrangement.
Overtime and penalty rates
A salary doesn't mean an employee misses out on overtime or penalty rates.
An employee's annual wage will generally include an amount for penalty rates and overtime. However, sometimes the annual wage isn't enough if the employee is working extra hours or at times they don't usually work.
If an employee works more than the ‘outer limit’ of hours in a pay period or roster cycle, they're entitled to be paid at their award overtime or penalty rate.
Employers have to undertake a reconciliation of their employees' annual wages:
- every 12 months after the arrangement starts, or
- when the employment ends.
Employers have to make sure their employees have been paid at least the same amount they would've been paid under the award if they weren't on an annual wage, for all the hours they worked.
If an employee's annual wage is less than the award payments that they would have received, their employer has to pay them the difference within 14 days. Check the Clerks Award for all entitlements for employees who are paid an annual wage.
To find out more about who this award applies to, go to the Clerks Award summary.
Source reference: Clerks - Private Sector Award [MA000002] clause 18