Are you ready for annualised wage obligations next week?

From 1 March 2020, new annualised wage provisions come into operation in many modern awards. They impose new and significant obligations on employers which in many cases will not be welcomed by employees. For example, you will be required to ensure that your employees record their starting and finishing times and their lunch breaks even if that is counter to your workplace value of trusting your people to do the right thing or something that you do not see as appropriate in your professional office. See our previous article for more details on the new obligations here.

The good news is that the Fair Work Commission has left the door open if you want to take an alternative approach via a common law contract. Here is what it said: “Employers may, pursuant to private contractual arrangements, pay employees in accordance with a salary arrangement that compensates for or “buys out” identified award entitlements without engaging with the annualised wage arrangements provision in the applicable award.” 

Of course, you still need to ensure that your employees are better off overall than they would be if they were paid strictly in accordance with all award conditions (not just the minimum rates). If that is true in your case and there is no potential for your employee’s annualised salary (whether expressed as a fixed annual or weekly or fortnightly or monthly amount) to fall below that total award entitlement, properly drafted set off clauses in your employment contracts will enable you to legally avoid “engaging with the annualised wage arrangements provision in the applicable award.

We can help you with that at a very affordable price – just $250 plus GST per contract. Of course, we will need you to show us that you are not in danger of underpaying people against award entitlements first – after all, we don’t want to be an accessory to an underpayment of wages.

If you want to engage us to assist with this, contact us here or call Peter Maguire on 0438 533 311.

A day in the life of Ridgeline HR

A day in the life of Ridgeline HR

Someone asked me what a day in the life of Ridgeline HR looks like. Well the truth is that it is a bit like the weather and we are never quite sure what that next challenge will be or where it will come from. What we do know is it could be any number and nature of things so we have to have the agility to adapt to respond to client needs. For example, yesterday, I:

  • Helped a creative design and manufacturing business with recruitment
  • Advised a hospitality business on a restructure
  • Ran a strategic planning workshop for a charity
  • Consulted to a community services organisation on classification and remuneration structures
  • Advised a transport business on an investigation and potential termination
  • Coached managers in an engineering business on values and behaviours
  • Assisted a travel agency with a redundancy
  • Consulted to a quarry on managing a chronically ill employee
  • Helped a construction business with connection to HRIS and employee engagement resources
  • Advised a financial planning practice on impending changes to modern awards

Where: Bayswater, Brisbane, Croydon (2), Geelong, Knoxfield, Little River, Melbourne CBD, Mulgrave, Scoresby. All in a day’s work at Ridgeline HR, Helping PEOPLE in BUSINESS with all manner of business and people matters in any industry anywhere. With continuously growing demand for our services and a range of exciting new services to come online this year, we are looking for HR generalists with strong workplace relations and HRIS competencies to work with us as contractors on assignments. Expressions of interest are invited. Contact Peter Maguire on 0438 533 311 or at peter@ridgelinehr.com.au.  [/av_textblock] [av_image src=” attachment=” attachment_size=” align=’center’ styling=” hover=” link=” target=” caption=” font_size=” appearance=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ copyright=” animation=’no-animation’ av_uid=’av-2gqpdm’ custom_class=” admin_preview_bg=”][/av_image]

Lots changed in 2019 and more coming in 2020

 As we transition in to the New Year, it is worth just checking that we are up to date with Fair Work and other changes that came in in 2019 and we are ready for what is coming. Here are some little reminders on what has already changed:

And a couple of new heads ups:

The modern award review process is still going in the Fair Work Commission 6 years after it started and we can expect more changes to awards in the year ahead. The other burning issue in 2019 was that of all of the cases of corporate underpayment of wages and the growing use of the term “wage theft”. This has prompted State and Federal Governments to explore the potential for criminal sanctions for deliberate wage theft – more coming on this no doubt in 2020. Anyone needing help with any of this or any employment matter, give Peter Maguire a call on 0438 533 311 for a free initial phone consultation. [/av_textblock]

Extension of coverage of Victorian Portable Long Service Leave Scheme

On and from 1 January 2020, National Disability Insurance Scheme (NDIS) and certain children’s services providers come under the Portable Long Service Benefits Scheme.

From that date, an activity funded by the NDIS, as well as services provided by licensed children’s services and approved providers under the Education and Care Services National Law, are included in the scheme as community services work.

This means that eligible employers, with workers undertaking these types of work, will need to register with the Portable Long Service Authority by 31 March 2020.

More information is available at https://www.vic.gov.au/portable-long-service-community-services-sector

Getting started for a great 2020

Getting started for a great 2020

Over the past year, we have developed some new positive psychology based approaches to personal development, engagement coaching and cultural change with some excellent results in our work with clients. So now it is time for us to look in the mirror – to lead by example and do it ourselves. Would you like to join us? Here is how. Under our EngageMentality coaching model, we have identified 5 prisms through which we look at and design peoples’ development. They are:

  1. Role(s): the functions that I perform and the technical skills and knowledge that I need to be successful in the role(s)
  2. Relationships: who are the key people with whom I relate, the people who rely on me and those whom I rely on to get good outcomes
  3. Values: what does good behaviour look like for me and for the people whom I work with
  4. Strengths: what am I innately good at and how do I utilise those strengths to good effect – if you haven’t done so, undertake the free VIA Character Strengths Survey
  5. Wellbeing: what I need to lead a balanced life which provides the nourishment that I need to flourish physically, mentally and socially

With each of those, we apply the Appreciative Inquiry methodology to define:

  1. Where we are at now in terms of our strengths (what’s working well) and opportunities (what can get better) – AI Discovery Phase
  2. Where we want to be in 12 months time – AI Dream Phase
  3. What actions will we take to leverage the strengths and take advantage of the opportunities – AI Design Phase
  4. Committing to and implementing my plan to deliver my Dream – AI Destiny Phase.

Put it all in a simple action plan with the following columns:

  1. The development objective
  2. The development actions
  3. The people responsible for the actions (you or you and someone)
  4. The timelines for the actions
  5. The status (tracking progress, celebrating achievements and recalibrating as needed)

The challenge then of course is to do it. Here are a few tips on that:

  1. Plan time in your calendar to undertake the actions you have committed to.
  2. Review your progress against your plan regularly – at least monthly and preferably weekly.
  3. Don’t stand still – stuff happens and things change so stay on top of that, be agile and adjust the plan as you need to – without compromising the Dream of course.
  4. Engage with a trusted someone whom you can talk to, get feedback from, celebrate the successes and learn from the things that haven’t quite gone to plan – this can be really valuable and a great emotional support.
  5. Keep a positive mindset, practise gratitude (be thankful for the good things and let people know) and be kind to yourself.

We are also factoring in daily practice of happiness in our plans through the free Action for Happiness resources available at https://www.actionforhappiness.org/calendars Here is the January 2020 calendar to get you started if you want to take this up too. Have a great 2020! If we can help to make your workplace a better place for people to flourish (our purpose), we would love to hear from you. [/av_textblock]

Heads up – new award obligations on annualised wages

So you think it is OK just to give your receptionist or your para planner or your chef or your …..  a standard weekly, fortnightly or monthly pay or an annualised salary regardless of the hours that they work? You pay above award so that’s OK, right? Well…….maybe. We know that one of the main reasons that employers like to have fixed wage or annualised salary arrangements is for simplicity in administration. Another is to offer a higher overall package than just award rates and conditions. Employees also get the benefit of superannuation guarantee contributions on the higher annualised wage or salary. So it can be a positive all round. We also know that there have been a number of high profile cases where workers have been grossly underpaid because annualised wage arrangements left them much worse off than they would be under award conditions. Unfortunately, for those who have been doing the right thing, it appears that you will also have to pick up an extra administrative workload in entering into and reviewing annualised wage/salary arrangements if you are to be compliant with the relevant award. The Fair Work Commission recently decided to vary 21 Modern Awards to provide annualised wage provisions that will come into operation on 1 March 2020. These variations impose significantly increased obligations on employers entering into annualised wage arrangements with employees. The new award clauses provide that an employer can have an annualised wage arrangement with an employee on the following terms:

  1. The annualised wage can compensate for and set off specific award provisions namely minimum weekly wages, allowances, overtime penalty rates, weekend and other penalty rates and annual leave loading;
  2. There must be written advice to the employee of the annual wage arrangement
  3. The employer must maintain a record of the annualised wage that is payable, which provisions of the award will be satisfied by the annualised wage, how it has been calculated with details on each separate component and any assumptions on overtime or penalties that have been used in the calculations
  4. The outer limit number of ordinary hours which would attract the payment of a penalty rate under the award and the outer limit number of overtime hours which the employee may be required to work in a pay period or roster cycle without being entitled to an amount in excess of the annualised wage
  5. If in a pay period or roster cycle an employee works any hours in excess of those outer limit amounts, such hours will not be covered by the annualised wage and must separately be paid for in accordance with the applicable provisions of the award.
  6. The annualised wage must be no less than the amount the employee would have received under the award for the work performed over the year for which the wage is paid (or if the employment ceases earlier over such lesser period as has been worked)
  7. The employer must each 12 months from the commencement of the annualised wage arrangement or upon the termination of employment of the employee calculate the amount of remuneration that would have been payable to the employee under the provisions of the award over the relevant period and compare it to the amount of the annualised wage actually paid to the employee. Where the latter amount is less than the former amount, the employer shall pay the employee the amount of the shortfall within 14 days.
  8. The employer must keep a record of the starting and finishing times of work, and any unpaid breaks taken, of each employee subject to an annualised wage arrangement for the purpose of undertaking that comparison.  This record must be signed by the employee, or acknowledged as correct in writing (including by electronic means) by the employee, each pay period or roster cycle.

The affected awards are:

  • Banking, Finance and Insurance Award 2010
  • Broadcasting and Recorded Entertainment Award 2010
  • Clerks – Private Sector Award 2010
  • Contract Call Centres Award 2010
  • Horticulture Award 2010
  • Hospitality Industry (General) Award*
  • Hydrocarbons Industry (Upstream) Award 2010
  • Legal Services Award 2010
  • Local Government Industry Award 2010
  • Manufacturing and Associated Industries and Occupations Award 2010
  • Marine Towage Award 2010*
  • Mining Industry Award 2010
  • Oil Refining and Manufacturing Award 2010
  • Pastoral Award 2010
  • Pharmacy Industry Award 2010
  • Rail Industry Award 2010
  • Restaurant Industry Award 2010*
  • Salt Industry Award 2010
  • Telecommunications Services Award 2010
  • Water Industry Award 2010
  • Wool Storage, Sampling and Testing Award 2010

Note: those awards with an * have industry specific provisions. Interestingly, the FWC decision also includes this statement: “Employers may, pursuant to private contractual arrangements, pay employees in accordance with a salary arrangement that compensates for or “buys out” identified award entitlements without engaging with the annualised wage arrangements provision in the applicable award.” If the Fair Work Ombudsman comes calling, I wouldn’t be relying on that statement as a defence because, even if you use a common law contract, you still can’t pay someone less than they would get under all relevant award conditions. There is also now a reverse onus of proof on employers to prove that they have not underpaid a worker so you need the evidence (ie the records of hours worked etc) in any case. So what does that all mean if you use employment contracts in lieu of strictly applying the award? At a minimum, you should do three things:

  1. Review your employment contracts to ensure that they have appropriate provisions to deal with award setoff and compensation (and, if you don’t have formal tailored employment contracts/agreements, get them)
  2. Have a process for regularly (at least annually) verifying that annualised salary/wage arrangements are adequate to ensure that the employee is better off overall than under award conditions
  3. Have a process for monitoring and managing hours of work and rosters to ensure that employees do not get into a situation where (at any point in time) they are not better off overall than they would be under the award rates and conditions.

If you need advice or assistance with any of the above, please contact us [/av_textblock]