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Annualised Wages – Changes to Awards Effective 1 March 2020

Be prepared for the important changes introduced by Fair Work effective from 1 March 2020 which will affect employees on annualised wages.  There are 22 affected awards including widely used awards such as the Clerks – Private Sector Award 2010, the Hospitality Industry (General) Award 2010 and the Manufacturing and Associated Industries and Occupations Award 2010.

What is an annualised wage? An employer and employee can agree that an employee’s annual salary/wage covers entitlements such as minimum weekly wages, overtime, penalties, allowances and annual leave loading, instead of the employee being paid a weekly or hourly award pay rate. 

Compliance with the changes: Under the new regime, if an employee works any hours in excess of the outer limit of hours set or the minimum percentage under the relevant award, such hours will not be covered by the annualised wage and must be separately paid in accordance with the applicable award, in the relevant pay cycle for the hours worked.

Employers will need to undertake regular reconciliation of overtime hours worked by employees and applicable penalty rates to ensure that employees are appropriately paid in accordance with relevant modern awards for each pay cycle, eg. fortnightly.  Accordingly, the keeping of records for employee’s start times, finish times, breaks, overtime periods and penalty rates will be imperative.
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Alphastream Lawyers
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