What are awards and how do they work?
As an employer, you’re obliged to offer employees certain minimum pay and conditions, such as holiday pay, sick pay, overtime loadings, uniform allowances and so on. The minimum pay and conditions vary depending where your business is located, and also vary according to your legal structure. The main thing to be aware of is that the onus is on you as the employer (rather than on the employee) to understand what the minimum legal pay and conditions are. Understanding what employment laws apply to you Due to the current pace of change regarding industrial relations, please ensure the information below is up to date by contacting the relevant authority. In the meantime, here's a guide for beginners: - Decide if you’re in the state or federal system. If you’re in New South Wales, Queensland, South Australia or Tasmania and you’re a sole trader or a partnership, then state employment laws apply. If you’re in one of these states and you’re a company, then federal laws apply. If you’re in the ACT, Northern Territory or Victoria, then federal employment laws apply, regardless of the legal structure of your business.
- If you’re in the state system, figure out what award (or awards) apply to your workplace. An award is a special document that outlines minimum wages and conditions of employment for groups of employees in a particular industry or occupation. If an award exists for your industry, then you as an employer have to stick by it. You can’t contract out of an award by getting an employee to agree to lesser conditions or agreeing to ignore their award. Check out the table below for contact details of the departments that govern awards for each state.
- If you’re operating in the federal system, figure out the relevant pay scale. The easiest way to do this is go to the Pay and Conditions pay of the Workplace Authority at www.workplace.gov.au, or to phone 1300 363 264. Browse through the Pay Scale Summaries until you find the award relevant to your industry and your state. (Yep, it’s confusing: You’re operating under federal jurisdiction, but these awards are still referred to as state awards.) If your employees started work after the 27 March 2006, then the conditions of what used to be that award don’t apply. Instead, you only use the award to get the rates of pay. For the conditions of employment, refer to the Australian Fair Pay and Conditions Standard. (See my next bullet point for details.)
- If you’re operating in the federal system, and you employed staff after 27 March 2006, read through the Australian Fair Pay and Conditions Standard.The ‘Standard’ outlines basic rates of pay, hours of work, and annual, personal and parental leave conditions. The beady-eyed amongst you may spot that this document also refers to minimum wages. Beware: Minimum wages are only relevant if there isn’t an award that covers your industry or occupation. Otherwise, the award always overrides any minimum wage set by the Standard.
- After you’ve figured out what awards, pay scales or standards apply to your workplace, print them out and read ‘em through. Not familiar with Swahili? Ring one of the help lines and get them to talk you through each document, or ask your industry association for assistance.
Warning! Be careful not to pay over the award for some things and under the award for others: Such contorted arithmetic isn’t permissible unless you negotiate some kind of workplace agreement. For example, don’t skip paying someone their tool allowance just because you pay them 50 cents an hour over the award, because if there’s ever a dispute, you’ll most likely have to back pay the tool allowance for the entire period they’ve worked for you — you won’t get a refund on your 50 cents an hour, either. The contents from this page are taken from Making the Most of MYOB Payroll, 2nd edition, by Veechi Curtis, available online for only $19.95 << Back to MYOB Payroll page
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