Casual to permanent: Fair Work amends standard award clause

Casual to permanent: Fair Work amends standard award clause

“Regular” casual employees covered by an award have a right to request that their employment be converted to permanent employment, following decisions by the Fair Work Commission (FWC) last year. A Full Bench of the FWC has now made some changes and clarified a few matters in another decision released earlier this month.

Who is a regular casual?

A regular casual is an employee who has over a calendar period of at least 12 months worked a pattern of hours on an ongoing basis and could perform the same work as a permanent employee without significant adjustment being required.

Such an employee can request a conversion to permanent employment, but must do so in writing. The employer can agree to or refuse the request, but can only refuse on “reasonable grounds” and after consultation with the employee.

What has been changed?

The FWC considered submissions from a wide range of parties, and its decision will make the following changes

  • The 12-month eligibility period will become a rolling period, not a one-off, so the employee’s right to request conversion will remain continually exercisable.
  • Casual employees who have worked an average 38 hours per week over the 12 months and are seeking conversion to full-time employment will now be required to have worked “equivalent full-time hours” over 12 months. This change is to allow for the fact that the employee may have taken periods of leave that could have reduced his/her average.
  • An employer’s grounds for refusing a request must be “based on facts which are known or reasonably foreseeable” (eg that the job will not exist in 12 months’ time), not speculative or based on a general lack of certainty about future needs.
  • The requirement that the employer and part-time employee agree in writing on the terms of employment (days, hours, start/finish times, breaks, overtime and notifying variations) have been clarified by standardising the provisions – in some awards, the employer was previously only required to “inform” the employee. 

Three awards that previously did not have casual employment conversion clauses will now have a clause inserted.

Minimum engagement for casual and part-time employees

This decision also clarified the minimum engagement period for employees to mean that that they must be engaged and paid for at least two consecutive hours on each occasion that they are required to attend work. This means that an employee must be paid for at least two hours every time he/she is called in, which in turn that an employee called in twice on the same day must be paid for at least two hours each time. Previously an employee could be called in twice or more but only paid for two hours.

The FWC also made some other changes to minimum engagement period provisions in some specific awards.

4-yearly review of modern awards – part-time employment and casual employment [2018] FWCFB 4695, 10 August 2018

More news on casuals

In another recent decision by a Full Bench of the Federal Court, a large number of employees currently described by employers as ‘casuals’ could in fact be permanent, thus removing any need to request permanent employment  Read more here.

 

By Mike Toten on 21st Aug 2018

What Type of Employees do you need – Permanent Full-time and Part-Time explained

What Type of Employees do you need – Permanent Full-time and Part-Time explained

What type of employees do you need?

Employees Permanent Full-time Permanent Part-Time explained. The type of employees that you choose to meet your business requirements is a very important decision. Business owners need to be aware of the legal ramifications relating to each employee type and manage them accordingly and appropriately. Businesses should follow ‘best practice’ to reduce the costs, minimise legal exposure and develop an engaged workforce. A well-designed Recruitment Process and New Starter documents also goes a long way to ensure your processes and procedures are effective. This also help integrate new employees for the long haul and not just a passer bye.

Once any employee has been hired, they must be given the Fair Work Information sheet thereby ensuring the employer meets their obligations under the FWA.

Types of Employee’s

Permanent full-time

This is the most common employee relationship. These individuals are employed on an ongoing and full-time basis. There isn’t a formal definition of permanent full-time however, it is generally taken that they work a 38-hour week or longer.  Under the Fair Work Act 2009 (FWA), if an employee is employed on a full-time basis but there has been no agreement of their ‘ordinary hours of work’, these can be considered to be 38 hours per week. When it comes to dismissal these workers generally have access to the complete range of legal remedies unless it is explicitly stated otherwise in their award. Damages awarded to a permanent employee would typically be higher than those awarded to a casual or fixed-term employee.

Permanent part-time

There is also no formal qualification of part-time hours, however, it is understood that they generally work less than 38 hours per week. They are different to casual employees in that they typically work the same hours each week. As defined by modern awards, they work ‘reasonably predictable’ or ‘constant’ weekly hours. When it comes to dismissal these workers generally have access to the complete range of legal remedies unless it explicitly states otherwise in their award. Damages awarded to a permanent employee would typically be higher than those awarded to a casual or fixed-term employee.

Deductions from Wages – the In’s and Out’s

Deductions from Wages – the In’s and Out’s

Deduction for Wages – the In’s and Out’s

We all know that it can be frustrating when you have an employee who you may have given an advance to, provided equipment to or where uniforms have not been returned on departure and you want to get it back BUT you need to know before you act what you can and cannot do.

HERES THE BASICS

An employer is prohibited from making any deduction from an employee’s wages without the employee’s specific authority and, even then, when this authority is obtained, such deduction can only be made for the purpose of paying a third party, for the benefit of the employee in accordance with the Fair Work Act.

AUTHORISED DEDUCTIONS

The Fair Work Act provides that an employer may deduct an amount payable to an employee if:

  • The deduction is authorised in writing by the employee and is principally for the employee’s benefit;
  • The deduction is authorised by the employee in accordance with an Award or Enterprise Agreement; or
  • The deduction is authorised by or under a law of the Commonwealth, a State or a Territory, or an order of a Court.

UNLAWFUL DEDUCTIONS

Some examples of deductions from an employee’s wages by an employer that could breach the Fair Work Act include:

  • Deductions to cover shortages from cash registers;
  • Cost of training courses provided to an employee where the employee is directed to attend by the employer;
  • Cost of a mobile telephone provided to the employee for work-related use;
  • Cost of tools and equipment supplied to an employee for work purposes;
  • Cost of damages to the employer’s assets (including motor vehicles);
  • Cost of breakages or accidents; and
  • Cost of an employee’s uniform

Knowing that you have someone there when you need them in times of turbulence. Grab your FREE 30-minute General Consultation on Employment Relations and Human Resources matters. Book in your appointment TODAY and talk DIRECT to our Expert ER/HR and University Lecturer Paulette McCormack

FREE 30-Minutes applies to new connections only. Advice is general in nature and should not be relied on in the absence of a comprehensive assessment of your situation. 

Minimum Wage Requirements

Minimum Wage Requirements

It is extremely important for employers to be aware of the national minimum wage rate.  By law employees must be paid the minimum wage for difference kinds of jobs under relevant Industry Awards. It is okay to pay employees more than the minimum wage,  however some employers are paying less which can come back to bite them. Many employers can become complacent or even unaware of the minimum requirements, and this can lead to unwanted problems for the business.

Finding the right award can be difficult and time consuming for many employers, however it is in their best interest to ensure employees are being paid the minimum award rate. The Industry Awards can be found on the Fair Work website under the industry in which you business is conducted. This can be confusing at times for employers to find the correct Award for a particular role.  Yet, it would be in their best interest to seek further advice to ensure they are paying their employees correctly.

It should be noted that different pay rates apply to casuals, who receive 25% loading on top of the minimum wage to make up for not receiving annual leave or personal and sick leave. Juniors, who are usually under the age of 21, will generally receive a lower wage which is calculated as a percentage of the relevant adult pay rate. Another important fact to remember is that employees must be paid correctly for all hours they work. This includes time spent training, in meetings, opening and closing the business and in some cases doing a trail shift.

Employers must be responsible for checking minimum wage rates on a yearly basis as each year the Fair Work Commission reviews the national minimum wage and pay rates under awards. The changes made will be published and begin from July, meaning that employers must pay their employees the correct wage from the first full pay period on or after 1st July.

There have been previous incidences where over a period of time employers have paid their employees below the minimum wage. Once this has been noted by the employee it has resulted in the business having to back pay. Being that it is generally a lump sum of money that is owed, it can be quite difficult for the employer, especially if running a small business, to acquire this money in a short period of time.

Overall, it is in the best interest of the business to continually check minimum wage rates to ensure every employee is being paid correctly. Whether they are full-time, part-time, casual or juniors, employers have a duty to ensure they are paying their employees correctly.

If you need help with your pay rates, awards or just want to get peace of mind that you are paying the right amount – contact us today

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Problems with set-off clauses for Award-Covered Employees

Problems with set-off clauses for Award-Covered Employees

Problems with set-off clauses for Award-Covered Employees

Only last week I was speaking about Basic HR Management to business owners in Brisbane about this particular topic. I feel it is, therefore, important to post here. 

Case Law: Simone Jade Stewart v Next Residential Pty Ltd (2016)

Having an employment contract did not prevent a former employee from claiming payments for additional hours worked because the contract failed to clearly express which entitlements were included in her annual salary.

As an administration coordinator, Ms Stewart was employed by Next Residential Pty Ltd (Next Residential) with an annual salary of $78,000. Her employment was terminated in January 2016, and she lodged a claim of underpayments of $30,000.

Ms Stewart alleged that Next Residential had not paid her overtime and lunch breaks as required by the relevant award. The award, in this case, was the Clerks – Private Sector Award 2010 [MA000002].

Next Residential claimed any additional hours worked were not directed by the company; any additional hours worked were offset by early finishes, late starts and half days, and, as per her contract, she was paid an annual salary, which took into account additional hours worked. The contract stated “Your salary is inclusive of any award provisions/entitlements that may be payable under an award” and “Your remuneration takes [reasonable] additional hours of work into account and no further payment will be made for extra hours worked.”

The Clerks – Private Sector Award 2010 [MA000002] contains a clause permitting employers to pay employees an annualised salary in satisfaction of minimum weekly wages, allowances, overtime and penalty rates and annual leave loading. The clause states that the employer is required to inform the employee which specific provisions of the Award would be satisfied by the annual salary.

Ms Stewart argued her contract of employment did not identify the applicable Award and did not inform her of the Award provisions that were satisfied in the annual salary. Consequently, she claimed she was entitled to overtime hours worked and payment for work completed during her lunch break, amounting to $28,984.

Decision:

Employers may pay employees an ‘all-inclusive rate’ that includes award entitlements, so long as this intention is clearly expressed in the contract of employment. However, under the Award relevant to Ms Stewart, not all entitlements may be included within an annualised salary, for example, meal breaks.

The Court found the contract created uncertainty and confusion by including “any” award provision under “an” award. The provision lacked specificity, and the parties were not alert to the applicable Award or the provisions which were to be included in the annualised salary. Further, the contract appeared to include entitlements in the annualised salary that, under the Award, could not be included.

As a result, the employment contract did not exclude Ms Stewart’s claim because the contract did not clearly indicate which entitlements were included in her annual salary.

Lessons:

Employers often include set-off provisions in employment contracts to provide one all-inclusive rate to satisfy all entitlements under an award or at law. You should review your employment contracts to;

  • check whether there is a relevant award that applies;
  • check the specific entitlements under that award that can be set off by providing an annual salary; and
  • amend and reissue employment contracts where this is not clear, or send out a letter to employees clarifying this.

Specific award entitlements should be included as a minimum and be as specific as possible.

Need help to review your contracts – call us on 1300 332 322.

Mention this article and get a 25% discount on updating all your employment contracts 

Working on public holidays

Working on public holidays

Employees get paid at least their base pay rate for all hours worked on a public holiday.

Awards, enterprise agreements and other registered agreements can provide entitlements for working public holidays, including:

  • extra pay (eg. public holiday rates)
  • an extra day off or extra annual leave
  • minimum shift lengths on public holidays
  • agreeing to substitute a public holiday for another day.

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Leave Loading – what is it ??

Leave Loading – what is it ??

Leave Loading – what is it ??

Salary-wages-511-618x270

The 17.5% leave loading is a wonderful historic legacy from the glory days of the Labour movement. The theory is when you are on holiday, you don’t have the opportunity to work overtime or do other things that might give you a bit extra in your pay packet each week. The 17.5% extra represents the extra earnings that you didn’t get the chance to earn. Of course, for people who work in most salaried jobs, there isn’t any overtime anyway, so the whole thing is faintly bizzare. This condition is a common feature of modern awards. The source of entitlement to annual leave loading when an employee proceeds on annual leave is usually the employee’s applicable relevant award or agreement or their individual contract of employment.

While you’re on leave, your rate of pay will be 117.5% of your normal rate of pay. So if your normal rate of pay is $2043.50 pf, your leave rate will be $2401.11 p
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