New workplace award rules coming into force on March 1

All employers with employees on fixed annual salaries are now on notice about new award rules coming into force on March 1st.

Articles in today’s Australian Financial Review (AFR) quote specialists in this field as describing the changes as the most onerous and far-reaching work place requirements in a decade.

The new Fair Work Commission rules coming into force on March 1 will increase the burden on employers to show they are reconciling hours and pay for award covered staff.

Realistically employers will be required to perform a reconciliation every pay period or roster cycle.

Even employers who have common law contracts with a set-off clause covering reasonable overtime will still need to record their staff hours and ensure they are still be paid at award rates.

You won’t know that the setting off of award entitlements is correct unless you know how long that person is working.

So as if the payroll function wasn’t important enough already, it will soon be even more important in terms of meeting these new obligations. Complexity is no excuse.

As an example, if a salaried employee is on $70,000 a year for 1950 hours work, that is $35.89 per hour. If the award is $32 per hour and that employee works just an extra 1 hour unpaid a day(5 hours a week), their real rate of pay is $31.67 per hour and is therefore being paid under award rates.

How many salaried staff are working just an extra hour a day, my guess is plenty.

If you want to know more or have any questions, please don’t hesitate to contact us