Agreement and NES Comparisons

The fair work legislation has resulted with a number of changes to the way Agreement's such as Collective Agreements and AWA's apply in workplaces. These changes must be complied with.

Where you have a workplace Agreement in place and it was made prior to 1 July 2009, your Agreement has automatically been amended by the operation of the fair work legislation.

The (major) Amendments

1. From 1 January 2010, the National Employment Standards (NES)  the Fair Work Act 2009 (Cth) apply to all registered workplace agreements (otherwise known as ‘transitional instruments’).

A term of a transitional instrument has no effect where the term is detrimental to an employee when compared to an entitlement provided by the NES – the better condition will prevail. This assessment is referred to as the 'no detriment test'.

2. From 1 July each year (since 2010), the base rate in your Agreement must be at least the equivalent rate in the corresponding modern award.

Examples of Automatic Amendments

Some examples of how a NES entitlement can override a similar entitlement of a registered workplace agreement are as follows:

Example 1: Annual Leave - A registered workplace agreement provides that annual leave will accrue monthly. The NES allows annual leave to accrue progressively based on an employee’s ordinary hours of work.

The effect of the Fair Work legislation is that the NES accrual provision will apply and override the registered workplace agreement accrual provision as the registered agreement accrual entitlement is detrimental when compared to the NES accrual entitlement.

Example 2: Redundancy Pay - A registered workplace agreement provides that a permanent employee is entitled to 6 weeks redundancy pay after 3 years continuous service. The NES provides that a permanent employee is entitled to 7 weeks redundancy pay after 3 years continuous service.

The effect of the Fair Work legislation is that in relation to a permanent employee made redundant with 3 years continuous service, the 7 weeks redundancy pay provision of the NES will apply and override the 6 weeks redundancy pay provision of the registered workplace agreement as the registered agreement redundancy entitlement is detrimental when compared to the NES redundancy pay entitlement.

An example of how a base rate of pay in an award can override a base rate of pay of a registered workplace agreement is as follows:

Example 1: Higher Base Rate of Pay - The base rate of pay (ie. permanent ordinary hourly rate) for a Bar Attendant under a registered workplace agreement is $18 per hour. The base rate of pay for a Food and Beverage Attendant Level 2 under the Hospitality Industry (General) Award 2010 (HIGA) which would be the equivalent classification for this type of work is $18.91 per hour.  

The effect of the Fair Work legislation is that the Bar Attendant must be paid a base rate of pay of $18.91 per hour. This is regardless of the registered workplace agreement stating a lower base rate of pay.

Further, any applicable loadings payable in addition to the base rate of pay under the registered workplace agreement must be paid on the higher base rate of pay of $18.91 per hour. Therefore, if the Bar Attendant is entitled to a shift loading of 15% in addition to the base rate of pay under the registered workplace agreement, the 15% shift loading must be paid in addition to the base rate of pay of $18.91 per hour, not the lower base rate of pay of $18 per hour under the registered workplace agreement.

(Adult) Apprentice Wage Rates

The minimum base rates of pay payable to adult apprentices covered by registered workplace agreements has also been effected by the operation of the Fair Work legislation. On 1 January 2014, an important amendment to the HIGA and the Restaurant Industry Award 2010 (RIA) introduced a range of minimum adult apprentice rates of pay.

Many registered workplace agreements that commenced prior to 1 January 2014 did not make provision for adult apprentice rates of pay. These employees were paid the applicable apprentice rate of pay based on the year of apprentice with no reference to age.

The operation of the Fair Work Legislation would therefore require those adult employees, despite being covered by a registered workplace agreement, to be paid the minimum adult apprentice base rates of pay under the HIGA and RIA (as the relevant modern award). In many cases this would be higher than the base rates of pay prescribed by the registered workplace agreement and therefore constitute an underpayment of wages.

The QHA can determine whether the applicable adult base rates of pay under the HIGA or other relevant modern award are higher than the apprentice base rates of pay prescribed by your registered workplace agreement.

For the nominal fee of $250.00* including GST for financial QHA members and $350.00 including GST for non-QHA members, the QHA can undertake an analysis and produce a table comparing the apprentice base rates of pay (including for adult apprentices) under the HIGA / RIA compared to your registered workplace agreement.

* This fee is only available to venue based hospitality members. A higher fee will apply to external companies, including Corporate Members and Partners seeking information on behalf of a venue, regardless of that venue's membership status. 

Download here an information/instruction guide for assessing how your Agreement is impacted.

Let the QHA Assist You!

Confused and concerned with what this all means? The QHA can assist you to determine how your Agreement has been impacted.

For the nominal hourly fee of $205.00* plus GST per hour, one of the QHA's Employment Relations experts can undertake the comparison and provide you with a detailed report.

We can also provide an estimate of our fees! 

This is an extremely competitive rate compared to law firms and other consultancy firms that can charge fees of around $350.00 plus GST per hour and higher.

Wesley Davey
Senior Employment Relations Adviser

Contact Wesley: wdavey@qha.org.au

 
* a higher hourly rate applies for non members.

Employment Relations Department
Ph: 07 3221 6999
Fax: 07 3221 6649
Email: er@qha.org.au

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