Analysis of Australian Fair Pay & Conditions Standard
AUSTRALIAN FAIR PAY AND CONDITIONS STANDARD
The Australian Fair Pay and Conditions Standard in Part 7 Workplace Relations Act
1996 (Cth) provides key minimum entitlements for all employees under Work Choices and prevails over any workplace agreement to the extent that it is more favourable than the workplace agreement (s172). It cannot be excluded by any workplace agreement (section 173 Workplace Relations Act
1996). These minimum entitlements include (section 171 (2) Workplace Relations Act
a) Basic rates of pay and casual loading
b) Maximum ordinary hours of work
c) Annual leave
d) Personal leave
e) Parental leave and related entitlements
WAGES – PART 7, DIVISION 2
If an employee is covered by an Australian Pay and Classification Scale (APCS) and they are not a piece rate worker, then the employee is guaranteed the basic periodic rate that is payable to the employee under the scale (section 182(1) Workplace Relations Act
1996). An APCS may either be a new or preserved APCS. If there is a pre-reform wage instrument (defined by section 178 Workplace Relations Act
1996 as a pre-reform federal wage instrument (an federal award in force immediately before the change, or any other Commonwealth instrument of this kind in force immediately before the change) or state wage instrument) determining one or more basic periodic rates of pay, then a preserved APCS is taken to exist including those basic periodic rates of pay (section 208 Workplace Relations Act
The award as far as it applies to wages and basic periodic rates of pay will apply as a preserved APCS to employees.
If an employee is not covered by an APCS and they are not a junior employee, an employee with a disability or a employee with a training agreement, then they are guaranteed the federal minimum wage (FMW) (section 182(3) Workplace Relations Act
The Act also guarantees casual loading for casual employees. section 185 Workplace Relations Act
1996 sets out a table for casual loading, with the default casual loading percentage being 20% (section 186 Workplace Relations Act
When we implement Workplace Agreements, section 182 (1) Workplace Relations Act
1996 will apply to the employees, and they will be covered by an AWA, so the default casual loading will apply to employees.
MAXIMUM ORDINARY HOURS OF WORK – PART 7, DIVISION 3
An employee may not be requested or required to work more than 38 hours a week plus any reasonable additional hours (section 226(1) Workplace Relations Act
1996). The employer and employee may agree in writing to have the employee’s hours averaged over a period of no longer than 12 months, with the average hours being 38 a week during the averaging period (section 226(a)(ii) Workplace Relations Act
ANNUAL LEAVE – PART 7, DIVISION 4
Annual leave applies to all employees except casual employees (section 227 Workplace Relations Act
An employee accrues an amount of annual leave at the end of every four week period worked by the employee for the employer, that amount being equal to 1/13 of the nominal hours worked during that four week period (section 232(2) Workplace Relations Act
1996). The number of nominal hours a week is calculated by starting with the specified number of hours the employee is employed to work and deducting any hours taken on leave which does not count as service (section 229(1) Workplace Relations Act
1996). If an employee is employed on a full time basis and the amount of hours are not outlined in the terms and conditions of an employee’s contract, the nominal hours are taken to be 38 per week (section 229(2) Workplace Relations Act
Based on a 38-hour week over a 12-month period, an employee would be entitled to 152 hours of annual leave, equivalent to 4 weeks of annual leave.
Section 233 also entitles an employee to forgo an amount of annual leave and receive payment in lieu of the leave they would have received. In order to be entitled to this option, there must be a clause in the workplace agreement specifically providing the employee the right to forgo the annual leave, and the provision must provide for the employee to receive payment in lieu of annual leave at a rate no less than the employee’s basic periodic rate of pay. The employee must provide the election to forgo annual leave in writing, and the employer must authorise this. However an employee is not entitled to cash in an amount of annual leave that is more than 1/26 of the nominal hours worked by the employee in any 12 month period (section 233(2) Workplace Relations Act
Based on a 38 hour week over a 12 month period, an employee would be entitled to cash in a maximum of 76 hours of annual leave, or 2 weeks of annual leave
Annual leave accrues on a pro-rata basis (section 234 (1) Workplace Relations Act
1996), is cumulative (section 234 (4) Workplace Relations Act
1996) and must be credited to an employee monthly (section 234 (2) Workplace Relations Act
PERSONAL LEAVE – PART 7, DIVISION 5
Personal/carer’s leave includes paid leave taken by an employee due to personal illness, injury etc. (‘sick leave’), and paid or unpaid leave taken by an employee to care for or support another member of the employee’s family due to illness, injury or unexpected emergency affecting the member (‘carer’s leave’) (section 244 Workplace Relations Act
All employees other than casual employees are entitled to sick leave they provide the necessary notice and documentation as pertaining to the individual employee in Part 7, Division 5, Subdivision D (section 245 Workplace Relations Act
1996). Sick leave accrues on a pro-rata basis (section 246 (3) Workplace Relations Act
1996), is cumulative (section 246 (5) Workplace Relations Act
1996), and should be credited to an employee monthly (section 246 (4) Workplace Relations Act
1996). For every completed 4 weeks of service, the employee is entitled to paid sick leave amounting to 1/26 of the number of nominal hours worked by the employee in that period.
Based on a 38-hour week over a 12-month period, an employee would be entitled to 76 hours or 10 days paid personal leave.
All employees are entitled to unpaid carer’s leave of 2 days per permissible occasion when a member of the employee’s immediate family or a member of the employee’s household requires care due to illness, injury or unexpected emergency affecting the member (section 250(1) Workplace Relations Act
1996). In order to receive this entitlement the employee must comply with any notice or documentation requirements in Subdivision D of Part 7, Division 5. An employee can only take unpaid carer’s leave if they cannot take any paid leave (section 252 Workplace Relations Act
Compassionate leave is also guaranteed by Part 7, Division 5, Subdivision E, being paid leave taken for the purposes of spending time with a person who is a member of the employee’s immediate family or household, and has a personal illness or injury that poses a serious threat to their lives, or paid leave after the death of a member of the employee’s immediate family or household (section 257 (1) Workplace Relations Act
1996). A period of 2 days per occasion of compassionate leave may be taken by an employee (section 257 (2) Workplace Relations Act
1996) providing they have provided any notice or documentation the employer requires (section 257 (3) Workplace Relations Act
PARENTAL LEAVE – PART 7, DIVISION 6
This Division guarantees parental leave for all employees except for casual employees who are not eligible casual employees as defined by section 264 (section 262 Workplace Relations Act
Subdivision B outlines the guarantee of maternity leave and the period of maternity leave, that may be taken. Any notice or documentation requirements for taking maternity leave are outlined in Subdivision C. Subdivision D states that at any time within 6 weeks of the expected birth date the mother may begin her maternity leave, and that she is required to take leave for at least 6 weeks after birth. This subdivision also deals with the affect of the death of the child on maternity leave entitlements, the return to work guarantee, and the guidelines for replacement employees.
Subdivision E guarantees paternity leave and the period to be taken, with Subdivision F outlining the notice and documentary requirements. There is also a return to work guarantee, guidelines for replacement employees, and the affect of death of the child on paternity leave entitlements in Subdivision G. Adoption leave is also guaranteed in Subdivision H.
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