6 Benefits of External HR Support

November 29, 2021/in Uncategorized /by Clyde Industrial

Small to medium sized businesses (SMEs) face many unique challenges owing to their size and relative capital. One such challenge that has been the focus of recent discussion is finding an effective way to manage their human resource and employment obligations. Here are six reasons that every SME can benefit from having external HR support.

Compliance

Like any other employing entity, SMEs have a range of responsibilities and obligations arising out of their status as an employer. This includes certain record keeping obligations, minimum wages and conditions, processes, and procedures. With an increased focus on enforcement by various government agencies including the Fair Work Ombudsman, it is exceptionally important that SMEs are across all their various lawful obligations. Frustratingly however, understanding those obligations and then putting them into practice is a complex process which can be daunting for many SME owners. An external HR consultant can cut through all the red tape and assist SMEs with managing their obligations arising out of the Fair Work Act 2009 (Cth) and the relevant Modern Award or Enterprise Agreement.

2. Cost Effective

Larger businesses have an advantage by virtue of their proportionately large revenues, and many will have a dedicated department which deals with human resources, workplace relations or ‘people and culture’. These departments are often full of highly qualified people who know the Fair Work Act backwards and have years of experience in dealing with employee management, dispute resolution and workplace investigations. For larger businesses having a ‘People and Culture Manager’ is a no-brainer, but for SMEs who may only employ 20 people this is a luxury that they cannot afford. Nevertheless, they are bound by the same rules as the big operators. Accordingly, having external HR support should be seen and a ‘must-have’, as it allows a smaller operator to have access to the same highly qualified and experienced people without the six-figure salary that ordinarily comes with it.

3. Sleep Easy

Having a dedicated external HR specialist will almost certainly allow a small business owner to sleep easier at night.

Knowing that your business is compliant with its employment and minimum wage obligations is itself a calming influence, but also knowing that you are equipped to deal with any obstacle or curveball that is thrown in your path is nothing short of a relief. Whether it be a sexual harassment claim, workplace bullying allegation, unfair dismissal claim, serious misconduct matter, underperforming employees, Fair Work Ombudsman audit, discrimination in the workplace or underpayment of wages complaint, SME owners will rest easier knowing that their external HR support is there to navigate any such troubled waters and take the burden off their shoulders.

4. Reduce Staff Turnover

Some employees leave their employers for financial reasons, but this is a lot less common than people think. Some of the most common reasons that people leave their jobs are in fact:

Feeling underappreciated
Feeling burnt out
Lack of flexibility
Poor workplace culture
Having a negative relationship with management
Lack of career growth opportunities
Being unhappy at work
A sense of distrust of their employer
Poor mental health

Small operators often find that that with external HR support and HR services in place, they see an improvement in staff morale, employer-employee trust, and a more positive workplace culture. This in turn leads to a reduction in staff turnover.

Having a high staff turnover costs employers’ significant amounts in lost productivity, recruitment costs and underproductive labour whilst new employees are being inducted and training.

5. Think like a big business

Good Human Resource Departments do a lot more than simply react to problems when they arise. Reacting to issues is a necessary and important part of employee management, however being proactive is even more vital. Large HR departments will often focus on developing processes and procedures that are designed to prevent such issues from arising the in first place, or if they do arise, making them less impactful. They will also invest lots of time into making significant increases to employee productivity which directly benefits the business’s bottom line.

For smaller businesses, this is often a luxury that they cannot afford. As a result of this, they are often stuck playing on the backfoot.

External HR support is like having that large HR department, without a huge price tag. It allows smaller businesses to start thinking in the same way that their larger competitors do, but at a fraction of the cost.

6. Take the pressure off yourself

Small businesspeople carry an enormous amount of responsibility and are often stuck wearing many hats. They are often the CEO, CFO, HR Manager, employee counsellor, financial controller, bookkeeper, salesperson, cleaner, operations manager and many more. Some small businesspeople are luckier than others and can outsource some of this work or employ people to do it for them. However, for many, this is an unavoidable part of running a small business. Engaging an external HR consultant can be a smart and cost effective way of alleviating some of this stress.

For assistance in any employment disputes or other human resources concerns, reach out to us here.

The Rossato Case – An Update on the Findings

October 14, 2021/in Uncategorized /by Clyde Industrial

The High Court has handed down its much-anticipated decision in the Rossato case, determining that the Full Court of the Federal Court had erred in its decision.

Background

The Decision of the Full Court in WorkPac Pty Ltd v Skene (Skene) in 2018, sent shockwaves through the nation when it ruled that a mine worker who was employed under a casual contract of employment, was in fact a permanent employee.

This decision departed from the conventional understanding of casual employment. Because the Fair Work Act 2009 (Cth) had no definition of a ‘casual employee’, the court felt it necessary to define the term. In doing so, the court adopted a wholistic analysis of the employment relationship, similar to the approach taken in determining whether a person is an employee or contractor. Despite the clear terms in the WorkPac Enterprise Agreement, and the employee’s contract of employment, the court felt it necessary to consider the actual conduct of the parties, including their post-contractual conduct.

The decision in Skene was a cause for concern for many employers across the country, who feared that the decision could lead to a tidal wave of casual employees seeking retrospective entitlements. Closer to home, the Skene decision represented an enormous risk to WorkPac, who had many employees in the same boat.

Rossato was seen as the best vehicle to test the Skene case.

Initially the Full Court adopted the reasoning of the earlier Court and upheld the Skene decision, with Justice Bromberg expressly endorsing the decision, reaffirming the need to examine the “entirely of the employment relationship”.

High Court Appeal

On Appeal to the High Court, WorkPac’s arguments focussed on the fact that Mr Rossato did not have a ‘firm advance commitment’, and therefore he was a casual employee, not entitled to the same benefits as a permanent, ongoing employee. WorkPac relied on the terms, both express and implied, within the Mr Rossato’s contract of employment, arguing that these terms dictated the nature of his employment and that it was not appropriate to conclude that the post-contractual conduct of the parties had altered the nature of the contract.

The High Court unanimously determined that Mr Rossato was a casual employee and therefore was not entitled to the benefits that he had sought.

In its decision the High Court adopted a strict contractual analysis of the employment relationship [paragraphs 62-63]:

“To insist upon binding contractual promises as reliable indicators of the true character of the employment relationship is to recognise that it is the function of the courts to enforce legal obligations, not to act as an industrial arbiter whose function is to synthesise a new concord out of industrial differences.”

“To insist that nothing less than binding contractual terms are apt to characterise the legal relationship between employer and employee is also necessary in order to avoid the descent into the obscurantism that would accompany acceptance of an invitation to enforce “something more than an expectation” but less than a contractual obligation. It is no part of the judicial function in relation to the construction of contracts to strain language and legal concepts in order to moderate a perceived unfairness resulting from a disparity in bargaining power between the parties so as to adjust their bargain…”

The High Court’s decision offers much needed certainty to employers who, following the decision in Skene, were fearful that a significant number of casual employees would seek retrospective access to a range of entitlements such as annual leave.

Looking towards the future, many of the issues addressed in Skene and Rossato have been addressed through the recent amendments to the Fair Work Act [Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Act 2021 (Cth)], which adopted a statutory definition of casual employment. Notably, the 2021 amendments also placed an obligation on employers to offer permanent, ongoing employment to casual employees after 12 months of continuous service (subject to a range of qualifying criteria).

Notwithstanding these amendments, which offer clarity for future employment disputes, the decision in Rossato limits the potential of retrospective disputes. Rossato has been seen by many employers as a ‘sigh of relief’ moment, but it is an important and timely reminder that, in light of the amendments to the Fair Work Act, employers should ensure that casual are drafted in such a way as to reflect the amendments.

For assistance in any employment disputes or other human resources concerns, reach out to us here.

Mandatory Vaccinations for Employees

September 14, 2021/in Uncategorized /by Clyde Industrial

The issue around mandatory vaccinations for employees is challenging, and frankly still quite ‘murky’.

There are a range of employees who are required by law (i.e. by way of state public health orders) to receive the vaccination in order to continue work. In Victoria, this is limited to Aged Care workers and Quarantine/Airport workers.

Other workers who work in close proximity with vulnerable people (such as health care workers, hospital staff, etc.) will either be subject to a similar lawful directive, or may be directed to receive a vaccine through a power available to them through their Enterprise Agreement (N.B. most of these workers will be covered by a public sector EA).

The remainder of the workforce however, is not subject to any such directives. The repeated message from Government is that this in unlikely to change in the future. Therefore, the decision to impose a mandatory vaccination policy within a workplace will be entirely at the discretion of the individual employer. This is problematic, because any such policy could immediately be subject to judicial scrutiny or be a point of contest in any dismissals that might result from non-compliance with such a policy.

Normally with grey areas such as this, we would hope to see a test case go before the Fair Work Commission or the Federal Court, with the resulting decision offering some guidelines in how policies ought to be correctly applied. However, in this circumstance, we are without such a case.

Some businesses have proceeded with a mandatory vaccine policy (notably the food processor SPC) and may end up being the very test case we are awaiting. However, any policy that is dealing with a mandatory vaccine impacting on public health will need to be quite specific to that business and its specific OH&S and public health considerations. Therefore, it is not necessarily a guarantee that if it were acceptable for SPC, it would necessarily flow to restaurants (because the public health implications would be different for example).

In order to offer some level of clarity amongst this inherently murky problem, the Fair Work Ombudsman (FWO) recently published some guidelines. Please note, these are simply guidelines and have no legal bearing on any potential future case that might arise.

In summary, FWO suggest that mandatory vaccine policies be addressed on a case-by-case basis. In doing so, employers should consider their OH&S/WH&S obligations, the nature of their workplace, the extent of community transmission, each employees personal circumstances, vaccine availability, whether employees have a legitimate reason to not be vaccinated (e.g. a medical exemption) among other things.

FWO suggests considering your specific workplace within the context of a four tier system:

Tier 1 work, where employees are required as part of their duties to interact with people with an increased risk of being infected with coronavirus (for example, employees working in hotel quarantine or border control).
Tier 2 work, where employees are required to have close contact with people who are particularly vulnerable to the health impacts of coronavirus (for example, employees working in health care or aged care).
Tier 3 work, where there is interaction or likely interaction between employees and other people such as customers, other employees or the public in the normal course of employment (for example, stores providing essential goods and services).
Tier 4 work, where employees have minimal face-to-face interaction as part of their normal employment duties (for example, where they are working from home).

Tier’s 1 & 2 are likely to already be subject to state public health directives (or soon will be). Tier 4 is unlikely to be able to ever introduce a mandatory vaccination policy because their risk profile is reasonably low. Tier 3 however, which is likely to include the hospitality industry, retail and other similar customer facing industries, is really where the challenge lies.

FWO suggests that tier 3 employers who are not in an area of high community transmission would likely find any mandatory policy to be unreasonable. However, tier 3 employers who are in high community transmission areas may have grounds to implement such a policy.

Irrespective of the above, each workplace must consider the question in light of its individual circumstances and follow a procedure for implementing a new workplace policy (i.e. consultation with employees, education about the new policy and giving employee’s time and opportunity to comply with the policy).

Ultimately, the question is one of balancing your obligation to provide a safe workplace to your employees and customers, against an individual’s right to not be vaccinated.

If a workplace policy is well-founded, after a careful consideration of the above circumstances, then is it likely to be enforceable.

If however, the policy is not well-founded or you have failed to consider the circumstances of the individual in question, then it may well be the basis for an unfair dismissal or general protections application.

Unfortunately, the question as to whether you can compel an employee to be vaccination has no simple or straight forward answer. If you would like assistance in determining whether your workplace should or could consider a mandatory vaccination policy please be sure to give us a call.

Why employment contracts are important for small businesses

Why employment contracts are important for a small business

August 20, 2021/in Uncategorized /by Clyde Industrial

Written contracts of employment are not mandatory in Australia. Some Modern Awards or Enterprise Agreements do require employees and their employees to agree to certain things in writing, such as minimum part time hours of work, days and times when work will occur and flexible work arrangements. However, in general there is no overarching statutory obligation for working arrangements to be recorded in writing.

What does this mean in the context of the contract of employment?

Importantly, it does not mean that a contract of employment is not required. It simply means that the contract of employment does not need to be recorded in writing.

A ‘contract’ is simply any promise, or binding agreement between two parties that has the four essential elements of a contract. Those key elements are:

There is an offer;
There is acceptance;
There is an intention to create a binding legal relationship; and
There is consideration (in other words, the contract involves an exchange. In the case of employment, the exchange that occurs is labour in exchange for a wage).

What makes up an Employment Contract

The essential elements of a contract can be achieved through either a verbal or written agreement.

In practice, this means that where an employment relationship exists, so too does a contract of employment, whether you have elected to record the agreement or not.

Whilst this is not unlawful (unless there are specific things required to be agreed in writing by an Award or Enterprise Agreement), it represents a significant risk to any employer, particularly if a dispute were to arise later on in the employment relationship. In this sense, one should consider a written contract of employment as an important source document that can clearly identified what was agreed to upon commencement.

Employment contracts can include a range of terms, provided what is being agreed to is not inconsistent with the law, or a minimum term of an Award or Enterprise Agreement. However, at their most basic level employment contracts should contain the following:

The parties: Who is a party to the contract.
The position: What position has the person been employed in?
Payment terms: Obviously terms related to payment are key to establishing an employment contract. These terms should include the amount that has been agreed to, the frequency of those payments and in what circumstances the amount may increase. If the payment is inclusive of other amounts (e.g., a fixed rate or salary), the contract should also specify what is included within that amount.
General Terms relating to the National Employment Standards: Whilst many of these may be reflected in the legislation, it is important to document what the general terms of the engagement are. This should include, what the employee’s ordinary hours of work are; what leave entitlements apply to the employee, what notice is required by either party to terminate the contract of employment etc.

In addition to the above, employers may wish to include other terms that are relevant to their business or their industry. These may include confidentiality terms or restraint of trade/non-compete clauses. These require careful drafting; however, they are often important to protect the business both during and after the employment period.

The key takeaways for small businesses are:

An employment contract is likely to exist whether its written down or not.
The interests of both parties are best met by having a written contract of employment.
Contracts should include some key terms, but should also reflect the specific interests of the business.

If you require further assistance in drafting employment contracts for your business, contact Clyde Industrial today on 1800 954 696.

Restaurant Industry Award – The Effects of a Significant Decision

July 21, 2021/in Uncategorized /by Clyde Industrial

A full bench of the Fair Work Commission has endorsed a proposal from Restaurant and Catering Industrial to streamline the award classification structure within the Restaurant Industry Award 2020, introduce an all-in allowance and introduce an exemption rate for higher-paid employees.

These significant award variations follow months of lobbying by the Industry’s peak body and have been warmly welcomed by restaurant employers across the country. However, the long-term future of the variations remains unclear.

The new award terms will come into effect from 11 August 2021 for an initial 12-month period. They are designed as a mechanism to assist the industry in COVID-19 pandemic recovery. The FWC has committed to a review of the scheme after nine months to assess the effectiveness of the provisions.

The Exemption Rate

The exemption rate, operating similarly to the existing annualised salary provisions, allows senior employees and their employers to agree to a ‘loaded’ weekly rate. If agreed to the loaded rate, which must be at least 170% higher than the prescribed minimum weekly base rate of pay, excludes a range of allowances, penalty rates, overtime rates and meal break penalties from applying in relation to that employee for all hours up to an including 57 hours per week. Additional remuneration arrangements apply for any work beyond 57 hours.

The exemption rate can only apply to employees classified at the Level 5 or Level 6 classifications.

The Substitution Allowance

The Substitution allowance can be agreed to either on an individual level (by mutual agreement), or enterprise-wide level (by a vote of all eligible employees with at least 75% support).

Once agreed, the affected employee/s will be entitled to receive an additional amount on top of their ordinary hourly rate of pay, in substitution for

(a) clauses 16.5 and 16.6 (meal break);

(b) clause 21.2 (meal allowance);

(d) clause 21.4 (tool and equipment allowance);

(e) clause 21.5 (special clothing allowance); and

(f) clause 21.6 (distance work allowance).

New Classification Structure

At the employer’s discretion the business may transition to the new classification structure under Schedule AA of the Award.

This new classification structure provides for a simplified two stream system of classification. Namely, a Restaurant and Café Worker stream and a Chef steam.

The Restaurant and Café Worker stream applies to all front of house employees, bar staff, kitchen hands, and unqualified cooks. Whilst the Chef Stream applies to trade qualified chefs.

The Schedule AA classification definitions are as follows:

AA.2 Restaurant/Café Worker Grade 1

AA.2.1 Means an employee who is engaged in any of the following:

(a) picking up glasses; or

(b) providing general assistance to food and beverage attendants of a higher classification not including service to customers; or

(c) removing food plates; or

(d) setting or wiping down tables; or

(e) cleaning and tidying associated areas; or

(f) receiving money; or

(g) cooking breakfasts and snacks, baking, pastry cooking or butchering; or

(h) general cleaning duties within a kitchen or food preparation area and scullery, including cleaning cooking and general utensils used in a kitchen and restaurant; or

(i) assisting employees who are cooking; or

(j) assembling and preparing ingredients for cooking; or

(k) general pantry duties.

AA.2.2 In addition to the duties set out in AA.2.1, means an employee who has not achieved the appropriate level of training and who is engaged in any of the following:

(a) supplying, dispensing or mixing liquor; or

(b) assisting in the cellar; or

(d) receiving money; or

(e) attending a snack bar; or

(f) performing delivery duties; or

(g) taking reservations and greeting and seating guests.

AA.2.3 In addition to the duties set out in AA.2.1 and AA.2.2, means an employee who has the appropriate level of training, and who is engaged in specialised non-cooking duties in a kitchen or food preparation area.

AA.3 Restaurant/Café Worker Grade 2

AA.3.1 Means an employee who has the appropriate level of training and is engaged in any of the following:

(a) supplying, dispensing or mixing liquor; or

(b) assisting in the cellar; or

(d) receiving money; or

(e) assisting in the training and supervision of food and beverage attendants of a lower classification; or

(f) delivery duties; or

(g) taking reservations and greeting and seating guests; or

(h) cooking duties such as baking, pastry cooking or butchering.

AA.3.2 In addition to the duties set out in AA.3.1, means an employee who has the appropriate level of training, which may include a supervisory course, and who has responsibility for the supervision, training and co-ordination of kitchen attendants of a lower classification.

AA.4 Restaurant/Café Worker Grade 3

AA.4.1 Means an employee who has the appropriate level of training, which can include a supervisory course, who:

(a) carries out specialised skilled duties in a fine dining room or a restaurant; or

(b) has responsibility for the supervision, training and co-ordination of food and beverage staff or for stock control for one or more bars.

NOTE: To avoid any doubt, an employee classified in one of the classifications set out in this Schedule shall perform all the duties of the classification as required by the employer.

AA.5 Chef stream

AA.5.1 Chef grade 1 (tradesperson) means a commi chef or equivalent who has completed an apprenticeship or passed the appropriate trade test or who has the appropriate level of training, and who is engaged in cooking, baking, pastry cooking or butchering duties.

AA.5.2 Chef grade 2 (tradesperson) means a demi chef or equivalent who has completed an apprenticeship or passed the appropriate trade test or who has the appropriate level of training and who is engaged to perform general or specialised cooking, butchering, baking or pastry cooking duties or supervises and trains other cooks and kitchen employees.

AA.5.3 Chef grade 3 (tradesperson) means a chef de partie or equivalent who has completed an apprenticeship or passed the appropriate trade test or who has the appropriate level of training in cooking, butchering or pastry cooking and who performs any of the following:

(a) general and specialised duties, including supervision or training of kitchen employees; or

(b) ordering and stock control; or

(c) supervising other cooks and kitchen employees in a single kitchen establishment.

The new classification streams will correspond to existing wage levels as follows:


Column 1 Employee Classification	Column 2 Employee stream and grade	Column 3 Minimum weekly rate (full-time employee)	Column 4 Minimum hourly rate
		$	$
Restaurant/Café Stream
Level 2	Grade 1 – Restaurant/Café Worker	805.10	21.19
Level 3	Grade 2 – Restaurant/Café Worker	832.80	21.92
Level 5	Grade 3 – Restaurant/Café Worker	932.60	24.54
Chef stream
Level 4	Grade 1 – Chef	877.60	23.09
Level 5	Grade 2 – Chef	932.60	24.54
Level 6	Grade 3 – Chef	957.60	25.20

Other than the new classification structure contained in Schedule AA, the remaining variations are contained in the new Schedule R of the Award. The key provisions are provided below:

Schedule R (operative from 11 August 2021 until 10 August 2022)

R.3 Exemption Rate

R.3.1 An employer and a full time employee (paid at the Level 5 or Level 6 rate of pay) may enter into an agreement to pay the employee no less than 170% of their relevant Level rate of pay each week as set out in clause 18—Minimum Rates of this award (the Exemption Rate).

R.3.2 Where an agreement to pay the Exemption Rate has been made, the following clauses of this award shall not apply:

(a) clauses 16.5 and 16.6 (meal break);

(b) clause 21 (allowances);

(c) clause 23 (overtime rates) but not clause 23.2; and

(d) clause 24 (penalty rates).

R.3.3 Where an agreement has been made to pay an employee the Exemption Rate the employee must be paid the Exemption Rate for each hour worked up to and including 57 hours in a week and for hours worked in excess of 57 hours in a week the employee must be paid:

(a) 150% of the Exemption Rate for the first two hours in excess of 57 hours in the week; and then

(b) 200% of the Exemption Rate thereafter in the week.

R.3.4 The Exemption Rate shall be the rate for the purposes of calculating:

(a) personal leave; and

(b) annual leave.

R.3.5 Clause R.3 does not apply to employees classified under the administrative and general stream (Schedule A.4).

R.4 Classification Structure and Definitions

R.4 Classification Structure and Definitions

R.4.1 Subject to clause R.4.2 an employer may elect to classify all relevant employees in accordance with the classifications set out in Schedule AA in substitution for classifying the employee in accordance with Schedule A.

R.4.2 An employee who is classified in accordance with Schedule AA shall be paid the minimum rate for the relevant classification in Schedule AA as set out in the table below in substitution for the minimum rates set out in clause 18—Minimum Rates of the award that would otherwise apply:


Column 1 Employee Classification	Column 2 Employee stream and grade	Column 3 Minimum weekly rate (full-time employee)	Column 4 Minimum hourly rate
		$	$
Restaurant/Café Stream
Level 2	Grade 1 – Restaurant/Café Worker	805.10	21.19
Level 3	Grade 2 – Restaurant/Café Worker	832.80	21.92
Level 5	Grade 3 – Restaurant/Café Worker	932.60	24.54
Chef stream
Level 4	Grade 1 – Chef	877.60	23.09
Level 5	Grade 2 – Chef	932.60	24.54
Level 6	Grade 3 – Chef	957.60	25.20

R.5 Substitution Allowance

Subject to this clause:

R.5.1 an employer and an employee may enter into an agreement to pay the employee a substitute allowance as below (the Substitute Allowance):

Column 1 Employee level	Column 2 Allowance per hour ($)
	$
Introductory	1.60
Level 1	1.60
Level 2	1.02
Level 3	0.98
Level 4	0.90
Level 5	1.01
Level 6	1.08

R.5.2 an employer and at least 75% of the employees in the workplace concerned may agree to pay all of the employees in the workplace a Substitute Allowance as below:

Column 1 Employee level	Column 2 Allowance per hour ($)
	$
Introductory	1.60
Level 1	1.60
Level 2	1.02
Level 3	0.98
Level 4	0.90
Level 5	1.01
Level 6	1.08

R.5.3 Where an agreement to pay the Substitute Allowance has been made in accordance with clause R.5, the following clauses of this award shall not apply:

(a) clauses 16.5 and 16.6 (meal break);

(b) clause 21.2 (meal allowance);

(d) clause 21.4 (tool and equipment allowance);

(e) clause 21.5 (special clothing allowance); and

(f) clause 21.6 (distance work allowance).

R.5.4 The Substitute Allowance shall be paid for all purposes of this award.

R.5.5 The Substitute Allowance is adjusted in accordance with increases to wages.

In addition to the above, Schedule R also importantly requires that employers consult with affected employees prior to enacting any of the above provisions. It further requires any agreements to be recorded in writing; and provides for a termination of any such agreements on the provision of four weeks’ notice.

For advice on how to implement any of the above award conditions contact Clyde Industrial

Bullying and Harassment in the Workplace

Amendments to Restaurant Industry Gathering Pace

June 17, 2021/in Uncategorized /by Clyde Industrial

A Fair Work Commission full bench has provided provisional support for variations to the Restaurant Industry Award 2020.

In December of 2020, the Industrial Relations Minister wrote to the Fair Work Commission expressing the Government’s view that: “in the extraordinary circumstances that have been caused by the COVID pandemic that it would be in Australia’s economic best interest for the Fair Work Commission to use its powers under s.157(3)(a) of the Fair Work Act 2009 (the Act) to undertake a process to ensure several priority modern awards in sectors hardest hit by the pandemic be amended. The process would be envisaged, if you considered it appropriate, to maintain a focus on key changes that could potentially support Australia’s economic recovery. The Government would obviously provide every available assistance to ensure the timely and comprehensive conduct of this process.”

One award specifically named by the Minister was the Restaurant Industry Award 2020, proposing flexibility measures such as:

Potentially simplified pay arrangements in the form of ‘loaded rates’ and/or ‘exemption rates’ designed to reduce the cost of administrative burden and address concerns about perceived risks arising from existing pay rate complexities and complexity risks that may lead to, particularly small business, mistakenly underpaying employees.”; and
Further streamlining of present classification structures so that they are clearer, easier to understand and simpler to apply. This might involve reducing the number of classifications through a broad-banding exercise with no reductions in pay and minimal increases in pay accompanied by greater variety and higher value work.

Following this correspondence, the President of the Fair Work Commission Justice Iain Ross commenced a process seeking submissions from interested parties about potential changes to the modern award.

Restaurant and Catering Industrial proposed a simplified classification structure proposing the removal of the “six arbitrary and overlapping levels to three easy-to-understand tiers”; an exemption rate to be agreed individually with current Level 5 and 6 employees which would enable a flat hourly rate of 170% for up to 57 hours per week; and a ‘substitution’ allowance in substitution for certain work and expense related allowances.

The Fair Work Commission issued a statement on 3 June 2021 stating their provisional support for the proposed variations.

“Having regard to the material filed and the safeguards included in the proposed schedule, it is our provisional view that the Restaurant Award should be varied in the terms set out…”

It is unclear whether these proposed changes would be a permanent feature of the Award, with the FWC suggesting a 12-month review of the clause may be appropriate.

The FWC full bench has called for submissions and evidence in relation to their provisional view by 28 June 2021 and reply submissions by 2 July 2021.

Upcoming Increases to Minimum Wage and Superannuation

June 17, 2021/in Uncategorized /by Clyde Industrial

Minimum Wage Increase

The Fair Work Commission has handed down a 2.5% increase to the national minimum wage and Modern Award rates as part of the 2021 Annual Wage Review.

The new national minimum wage will be $772.60 or $20.33 per hour, effective from 1 July 2021.

In a move similar to the 2020 annual wage review, the Commission has delayed the commencement of the modern award wage increase for several industries. Specifically, the General Retail Industry Award 2020 increase will take effect from 1 September 2021, with the following list of awards to increase from 1 November 2021:

Air Pilots Award 2020
Aircraft Cabin Crew Award 2020
Airline Operations – Ground Staff Award 2020
Airport Employees Award 2020
Airservices Australia Enterprise Award 2016
Alpine Resorts Award 2020
Amusement, Events and Recreation Award 2020
Dry Cleaning and Laundry Industry Award 2020
Fitness Industry Award 2020
Hair and Beauty Industry Award 2010
Hospitality Industry (General) Award 2020
Live Performance Award 2020
Mannequins and Models Award 2020
Marine Tourism and Charter Vessels Award 2020
Nursery Award 2020
Racing Clubs Events Award 2020
Racing Industry Ground Maintenance Award 2020
Registered and Licensed Clubs Award 2020
Restaurant Industry Award 2020
Sporting Organisations Award 2020
Travelling Shows Award 2020
Wine Industry Award 2020.

All other modern award increases will take effect from the first full pay period on or after 1 July 2021.

The delayed increases reflect the economic research presented to the panel, which suggested that some industries have been “lagging” in their COVID-19 pandemic recovery. Notably, the Commission excluded the Fast Food industry from the broader Accommodation and Food Services Sector, finding that “fast food businesses are, generally speaking, less likely to have been adversely affected by the pandemic than cafes and restaurants because the restrictions imposed to contain the virus have generally not prohibited take away food services.”

The panel noted the impact of the 0.5% increase in the Superannuation Guarantee, however did not specifically apply a deduction for it.

Superannuation Increase

The Superannuation Guarantee – compulsory employer contributes – will increase from 1 July from 9.5% to 10%. This increase is part of a broader legislative schedule of increases that commenced in 2013, designed to incrementally increase the Superannuation Guarantee from 9% to 12%. Under the legislative schedule, the Superannuation Guarantee will increase again to 10.5% on 1 July 2022 with annual 0.5% increases to continue until 1 July 2025.

On 21 May 2021, the Australian Government announced in the 2021-22 Federal Budget, that it would be removing the $450 per month threshold which currently applies to the Superannuation Guarantee. This measure has not yet been legislated; however, it is anticipated to be in place prior to 1 July next year.

This will mean that employers are required to make super contributions to eligible employees who earn less than $450 per month (provided they satisfy the other eligibility requirements).

National Employment Standard Casual Amendments

June 15, 2021/in Uncategorized /by Clyde Industrial

The purpose of this article is to update you on a recent amendment to the National Employment Standards under the Fair Work Act 2000 (Cth) related to casual employment. This amendment came into effect from 27 March 2021.

What does this amendment involve?

Inserting a new definition of casual employment into the Act

Under the new definition, a person is a casual employee if they accept a job offer from an employer knowing that there is no firm advance commitment to ongoing work with an agreed pattern of work.

Once employed as a casual, an employee will continue to be a casual employee until they are either:

1. become a permanent employee through:

a. casual conversion, or

b. are offered and accept the offer of full-time or part-time employment, or

2. stop being employed by the employer.

This legislative definition provides certainty around the issue of casual employment, which has been increasingly challenged in recent decisions of the Fair Work Commission and the Courts.

Casuals who were employed immediately before 27 March 2021 and whose initial employment offer meets the new definition continue to be casual employees under the FW Act.

Becoming a permanent employee

The Amendment Act adds a new entitlement to the National Employment Standards (NES) giving casual employees a pathway to become a full-time or part-time (permanent) employee. This is also known as ‘casual conversion’.

An employer (other than a small business employer) has to offer their casual employee to convert to full-time or part-time (permanent) when the employee:

has worked for their employer for 12 months
has worked a regular pattern of hours for at least the last 6 of those months on an ongoing basis
could continue working those hours as a permanent employee without significant changes.

The offer for conversion must be provided to employees in writing to the employee within 21 days of the casual employee’s 12-month work anniversary.

Employers are not required to make an offer where there are ‘reasonable business grounds’ not to. Reasonable business grounds are defined in the Bill and include a number of factors including, for example, where the employee’s positions will no longer be required or there will be a significant change to the hours or days the employee is engaged.

If an employer considers there are reasonable business grounds not to make an offer of conversion, these details must be specified in writing and provided to the employee within 21 days.

The Bill makes clear that, where an employee refuses an offer to convert, they lose the right to convert for the next 6 months

Equally, where an employer has determined that there a reasonable business grounds to not make an offer of casual conversion and notifies the employee in accordance with the provisions of the Bill, then the employees also cease to hold a right to request conversion for the next 6 months

Making and responding to offers and requests

There are rules for how employers and employees need to make and respond to offers.

There are also rules for offering casual conversion to existing casual employees.

Casual employees have a right to request to convert to full-time or part-time (permanent) employment in some circumstances. This applies:

for casual employees working for a small business – at any time if they meet the requirements

for other casual employees – after their employer has decided not to make an offer for casual conversion.

Requirement to issue CEIS

The Amendment also requires employers to issue all new casual employees with the Casual Employment Information Statement (CEIS) upon commencement of their employment.

The CEIS is attached to this email. The CEIS operates similarly to the Fair Work Information Statement (FWIS), in that is must be included in a new employee’s induction material.

Providing the Statement to existing employees

Existing casual employees will also need to be provided with the attached statement. This must occur as soon as practicable for small business employers. For businesses that are not ‘small business employers’, the statement must be given as soon as practicable after 27 September 2021.

If you require any assistance with the practical implementation of this new amendment or would like to ask any questions such as the definition of ‘reasonable business grounds’ or ‘small business employer’, please don’t hesitate to contact us directly.

Sincerely,

Patrick Crosswell

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