The General Retail Industry Award 2020 was varied by the Fair Work Commission with effect from 1 July 2021 in relation to the rules for varying hours of work for part-time employees.

According to that Award, a part-time employee is one who is engaged to work for fewer than 38 ordinary hours per week and whose hours of work are reasonably predictable.

Obligations on engagement

At the time of engaging a part-time employee, the employer must agree in writing with the employee on a regular pattern of work that must include all of the following:

• the number of hours to be worked on each particular day of the week (the guaranteed hours); and
• the times at which the employee will start and finish work each particular day; and
• when meal breaks may be taken and their duration.

Under the Award, such an agreement can be recorded in writing now including through an exchange of emails, text messages or by other electronic means.

Comment: guaranteed hours is a new terminology seemingly designed to fix a base of hours with the potential for flexing up by agreement if needed. The specific recognition of email and texts as valid means of recording agreements is sensible because nowadays that is generally what happens.

Agreements to work additional hours

An employer and an employee may agree to vary the regular pattern of work agreed (i.e. the guaranteed hours) on a temporary or ongoing basis, with effect from a future date or time.

Any such agreement must be recorded in writing (including through an exchange of emails, text messages or by other electronic means):

• if the agreement is to vary the employee’s regular pattern of work for a particular rostered shift – before the end of the affected shift; and
• otherwise – before the variation takes effect.

Such an agreement cannot result in the employee working 38 or more ordinary hours per week.

Comment: this provides flexibility for those occasional situations that small businesses in particular can experience where someone is running late or not able to attend work or there is an unexpected increase in customer demand. To cover that, they can ask someone to do some extra hours over and above their guaranteed hours as long as agreement is made before the extra hours have to be worked. Otherwise, any additional hours would be payable at overtime rates.

Changes to regular hours made by employer

An employee’s regular pattern of work as agreed, other than the employee’s guaranteed hours, may be changed by the employer giving the employee 7 days, or in an emergency 48 hours, written notice of the change.

However, the regular pattern of work of a part-time employee must not be changed from week to week or fortnight to fortnight or to avoid any award entitlements.

Comment: this provides some limited ability for an employer to direct variations in hours of work for a part-time employee but cannot result in a reduction in the guaranteed hours (ie the number of hours to be worked on each day of the week). So the hours could be shifted within a day or added to but not decreased. If an employer tries to use this power to avoid making overtime payments on a regular basis, it could result in a claim of breach of award
and underpayment of wages.

Requests for review of guaranteed hours

If an employees’ guaranteed hours are less than the ordinary hours that the employee has regularly worked in the previous 12 months, the employee may request in writing that the employer increase their guaranteed hours on an ongoing basis to reflect the ordinary hours
regularly being worked.

An employee may only make such a request once every 12 months.

The employer must respond in writing to the employee’s request within 21 days and may refuse the request only on reasonable grounds. 

The Award provides an example of this: Reasonable grounds to refuse the request may include the reason that the employee has regularly worked more ordinary hours than their guaranteed hours is temporary—for example where this is the direct result of another employee being absent on annual leave, long service leave or worker’s compensation.

Before refusing a request, the employer must discuss the request with the employee and genuinely try to reach agreement on an increase to the employee’s guaranteed hours that will give the employee more predictable hours of work and reasonably accommodate the
employee’s circumstances.

If the employer and employee agree on an increase to the employee’s guaranteed hours, the employer’s written response must record the agreed increase.

If the employer and employee do not reach agreement, the employer’s written response must include details of the reasons for the refusal, including the ground or grounds for refusal and how the ground or grounds apply.

If the matter is still not resolved, either party can refer it to the Fair Work Commission for conciliation and/or arbitration.

Comment: the process and rules here are similar to those that apply to requests for flexible working arrangements and applications for casual conversion. The bottom line is that any employer who does not act reasonably and follow the rules can find themselves fronting the Fair Work Commission with the potential for orders regarding guaranteed hours of work and possibly remedies for underpayment of wages.

The takeaways

For retail employers, the key lessons are:

1. Have a sound staffing plan based on a realistic expectation of customer demand and work requirements, adjusting seasonally
2. Develop positive relationships with your people and find out who has the flexibility to work additional hours if needed at particular times and at short notice
3. Consider whether all of the compliance work involved in varying a part-time employees’ hours is actually worth it eg if there is little requirement for
   additional hours, it might be easier and more practical just to pay the overtime rate for the additional hours
4. Consider paying people above award rates in return for a bit of flexibility through a common law contract but ensuring that people would still be better off overall than in literally applying award conditions
5. If you have casual employees who have been employed with you for 12 months or more (or are likely to be), consider whether they should convert to full-time or part-time and, if part-time, what their guaranteed hours should be.
6. Make sure that you are maintaining all of the employment records that you are required to under the Award requirements re part-time employment and otherwise as required under the Fair Work Act and Regulations.
7. If you need assistance in working through this or you run into a disagreement with an employee, get professional help.

You can take advantage of our free first consultation on this or any other HR matter by contacting us on 0421 592 541 or enquiries@ridgelinehr.com.au