In March 2008, after the Transition to Forward with Fairness legislation came into effect, the Minister for Employment and Workplace Relations requested the Australian Industrial Relations Commission ("AIRC") to modernise awards.
The object of award modernisation is to simplify and streamline thousands of state and federal awards throughout Australia and to make them easy to apply.
Modern Awards together with the National Employment Standards and National Minimum Wage Orders make up the guaranteed safety net of enforceable minimum terms and conditions which the Fair Work Bill seeks to establish.
Modern Awards will come into effect on 1 January 2010 from which time they will be administered by a new body, namely Fair Work Australia ("FWA").
Contents of Modern Awards
Modern Awards are intended to build on the 10 National Employment Standards ("NES"). They:
- may include:
- 10 additional conditions of employment including: minimum wages, types of employment, overtime, allowances and penalty rates;
- industry specific redundancy schemes;
- terms dealing with cashing out of annual leave and personal leave and averaging of hours of work.
- must include:
- a flexibility clause that will enable an employer and an individual employee to negotiate an individual flexibility arrangement which can vary aspects of the award (e.g. overtime rates, penalty rates and allowances). However, the employee must not be disadvantaged as a result of entering into this arrangement;
- coverage terms setting out the employers, employees, organisations and outworker entities that are covered by the relevant award. However, Modern Awards will not apply to high income employees (with guaranteed annual earnings of more than $100,000.00 p/a or prorata for part-time employees indexed each year);
- a term providing a procedure for settling disputes about any matter arising under the award and in relation to the NES;
- terms regarding the ordinary hours of work for each classification and each type of employment in the award;
- where FWA considers it appropriate, terms providing for the automatic variation of allowances when wage rates in the award are varied.
- must not include terms that are:
- "objectionable" in that they deal with payment of a bargaining services fee or permit a breach of the general protections in the FW Bill (regarding the rights and responsibilities of employers, employees, organisations etc.)
- about payments and deductions for the benefit of the employer;
- about rights of entry;
- discriminatory; or
- deal with long service leave or contain certain state based differences.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
