Minimum Working Conditions
Fair Work Act 2009: The National Employment Standards
The National Employment Standards under the Fair Work Act 2009 constitute a safety net for employees within the federal system. The Standards are designed to complement the key industrial instruments under the Fair Work Act – being modern awards and enterprise agreements.
As well as legislating minimum standards, the Standards allow many issues to be addressed in awards and agreements. Modern awards provide for minimum wages, which explains their absence from the Standards.
The National Employment Standards establish minimum conditions in the following areas:
- maximum weekly hours of work;
- requests for flexible working arrangements;
- rights to convert from casual to permanent employment;
- parental leave and related entitlements;
- paid family and domestic violence leave;
- annual leave;
- personal / carer’s leave and compassionate leave;
- community service leave;
- long service leave;
- public holidays;
- workplace delegates’ rights;
- notice of termination and redundancy pay; and
- the Fair Work Information
In addition to the Standards, the Fair Work Act provides that all employees must be paid at least monthly, and without any unauthorised deductions from their pay.
Salary
The current national minimum wage in Australia is $23.23 per hour or $882.80 per 38-hour week, effective from 1 July 2023, Modern award wages also increased by 5.75% from 1 July 2023.
All Australian employers must also pay superannuation under the Superannuation Guarantee (Administration) Act 1992 (Cth). Employers pay a percentage of the ordinary time earnings of their employees (including part-time and casual employees) who are aged over 18, and who are generally paid at least $450 (before tax) a month, into a complying superannuation fund or retirement savings account.
The current Superannuation Guarantee rate is 11% from 1 July 2023, and will then increase by 0.5% increments each year until it reaches 12% by 1 July 2025.
Maximum Working Week
The National Employment Standards provide that full-time employees cannot be required to work more than 38-hours in a week, plus reasonable additional hours. What is considered “reasonable” is governed by a range of factors in the Fair Work Act. Further, hours can be averaged over periods set by awards, up to a maximum of 26 weeks.
Overtime
Assessment of whether additional hours are “reasonable” involves factors that include the employee’s remuneration, patterns of work in the industry, and the nature of the employee’s role. As previously mentioned, all employees covered by an award, enterprise agreement or registered agreement may also be entitled to a higher pay rate and additional allowances when working on weekends, public holidays, overtime, early in the morning and/or late at night or in difficult or unpleasant circumstances.
Request for Flexible Working Arrangements
The National Employment Standards provide that certain categories of employees can request flexible work arrangements, including:
- employees who are parents, or have responsibility for the care of a child who is of school age or younger;
- employees who are parents, or have responsibility for the care of a child who is disabled;
- employees who are carers within the meaning of the Carers Recognition Act 2010 (Cth), such as carers of people with medical conditions, disabilities, mental illnesses or the elderly, with the exception of people who are acting as carers under contracts of service, as volunteers, or as part of an education requirement;
- employees who have a disability;
- employees who are aged 55 years or older;
- employees who are experiencing domestic violence or providing care or support to another member of their family/household who are experiencing domestic violence.
An employee returning to work after a period of leave in relation to the birth or adoption of a child may also request to work part-time.
An employee is not entitled to make such requests unless — in the case of a full-time and part-time employee — they have completed at least 12 months of continuous service, or — in the case of a casual employee — they have been employed as a casual on a regular and systematic basis during a period of at least 12 months and have a reasonable expectation of continuing employment on that basis.
An employer can now only refuse such a request where, amongst other things, the request has been discussed with the employee, the employer has genuinely tried to reach an agreement, the refusal is on reasonable business grounds and the employer has provided the employee with detailed reasons for the refusal in writing.
If the employer and the employee cannot reach an agreement, the Fair Work Commission also has the power to deal with the dispute, by conciliation, or if that fails, by arbitration.
Right to disconnect
Effective from 26 August 2024 (or 26 August 2025 for businesses with fewer than 15 employees), a new right will now give employees the right to refuse to monitor, read or respond to contact (or attempted contact) from an employer outside of their working hours – unless that refusal is unreasonable. The right also extends to contact (or attempted contact) outside of the employee’s working hours from a third party if work related (for example, from customers or clients).
Some of the factors that must be considered in determining whether an employee’s refusal to be contacted is unreasonable are:
- the reason for the contact or attempted contact;
- how the contact or attempted contact is made and the level of disruption the contact or attempted contact causes the employee;
- the extent to which the employee is compensated (including non-monetary compensation) to remain available to perform work or be contacted, or for working additional hours, outside of ordinary working hours;
- the nature of the employee’s role and the employee’s level of responsibility; and
- the employee’s personal circumstances (including family or caring responsibilities).
The Fair Work Commission will have the power to make an order to stop refusing contact, to stop taking certain actions, or to otherwise deal with the dispute. This will also be civil remedy provision, meaning that breach of an order could attract penalties.
Notice of Termination and Redundancy Pay
Notice of termination of employment must be given in writing, on a date before that of the termination. Though minimum periods of notice to be given by the employer are set out in legislation and modern awards, enterprise agreements and contracts of employment may also include terms specifying periods of notice to be given by the employer.
The National Employment Standards confer a statutory entitlement to redundancy pay on employees. An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:
- at the employer’s initiative, because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or
- because of the insolvency or bankruptcy of the employer.
However, a person’s dismissal will not be considered to be a case of “genuine redundancy” if it would have been reasonable in all of the circumstances for the person to be redeployed within the employer’s enterprise or the enterprise of an associated entity of the employer. Whether redeployment of an employee is considered reasonable will depend on the circumstances that exist at the time of the dismissal, including the availability and nature of such a position, the qualifications required and the skills and qualifications of the employee, and the location of the job. The employee will be entitled to make an unfair dismissal claim it if is found on the balance of probabilities that it would have been reasonable in all the circumstances to redeploy the dismissed employee and the employee was made redundant instead.
The amount of redundancy pay is calculated using the employee’s base rate of pay and is a product of the number of years of continuous service that the employee has rendered to the employer. Employees may also have redundancy entitlements arising from their contracts of employment or specific redundancy entitlements outlined in their award.
Until 15 December 2023, small businesses (employers that employ fewer than 15 employees at a particular time) were not required to pay redundancy pay to employees who were made redundant. However, section 121 of the Fair Work Act has now been amended to provide for some limited circumstances where small businesses will be required to pay redundancy pay.
The exception will apply if the employer was not previously a small business and only became a small business due to terminating employees as part of their move to insolvency. The criteria for the obligation to pay redundancy pay are that at the time of making the relevant employee redundant:
- the employer is bankrupt or in liquidation (other than voluntary winding up); and
- the employer previously terminated various employees either:
- six months before becoming bankrupt or going into liquidation; or
- due to the insolvency of the employer.
Information Statements
The National Employment Standards require employers to provide their employees with information statements prepared by the Fair Work Ombudsman. The information statements include information on such matters as right of union entry, termination of employment and the National Employment Standards themselves.
Currently, there are three types of information statements:
- the Fair Work Information Statement must be given to all new employees (irrespective of whether they are permanent, casual or fixed term employees);
- in addition to the Fair Work Information Statement, casual employees must be given the Casual Employment Information Statement; and
- in addition to the Fair Work Information Statement, fixed-term contract employees must be given the Fixed Term Contract Information Statement.
Modern Awards and Enterprise Agreements
An award is a legal instrument that operates with the force of legislation and imposes obligations on employers in relation to minimum wages and conditions of employment for employees in an industry or occupation. Awards cover conditions, which include rates of pay, penalty rates, overtime and allowances. Awards apply in addition to the National Employment Standards (see paragraphs below).
In recent years, the award system in Australia has undergone a process of award modernisation. This resulted in the replacement of thousands of awards in Australia by a system of 122 modern awards, which came into effect on 1 January 2010.
Modern awards apply to most employees and employers in the federal workplace relations system. Each modern award covers an industry and/or occupation. Most employees, other than senior employees, who work in an award covered industry or occupation will be covered by that award.
Due to various recent amendments to the Fair Work Act, the Fair Work Commission is currently in the process of reviewing all modern awards.
Enterprise agreements provide for the employment conditions between an employee or group of employees and an employer. Whereas modern awards provide for minimum conditions for an industry or occupation, enterprise agreements generally provide for specific conditions for one workplace, and are negotiated by the employer and its employees or union representatives directly. The Fair Work Act provides for the making of multiple employer enterprise agreements only in limited circumstances. Once approved by the Fair Work Commission, enterprise agreements are legally enforceable.
Where an enterprise agreement applies, it will override any otherwise applicable modern award. The enterprise agreement cannot, however, provide for a pay rate that is less than the pay rate in the applicable modern award.
Employer’s Obligation to Provide a Healthy and Safe Workplace
Historically, occupational, health and safety laws have largely been a matter for each State and Territory. This split created difficulties for governments, businesses and individuals who operated in more than one State or Territory.
Accordingly, there has been a move towards the national harmonisation of occupational health and safety laws. The harmonisation scheme comprises template legislation agreed to in consultation between adopting States (the Model Work Health and Safety Act (“Model Laws”)), regulations (the Model Work Health and Safety Regulations (“Model Regulations”)) and the Model Codes of Practice (“Codes”). It is intended that each jurisdiction adopt the Model Act, Model Regulations and Codes. With the exception of Victoria, the Commonwealth and all other States and Territories have adopted the scheme.
Unfortunately, a number of the enacting States have departed from the original templates such that although the legislation operating in the different States and Territories is similar, it is not uniform. For example, while almost all Australian jurisdictions now have industrial manslaughter offences in force, the Commonwealth, NSW, South Australia and Tasmania are yet to pass such laws. The current NSW government has, however, foreshadowed introducing an industrial manslaughter bill to the NSW parliament in early 2024.
The scheme provides scope for some differences between jurisdictions. For example, under the scheme, each jurisdiction is responsible for enforcement and has its own occupational health and safety regulatory body.
The harmonised laws impose a primary duty of care on persons conducting a business or undertaking, in relation to the work being performed in that business or undertaking. This obligation reaches beyond employers, to a wider group of legal entities and individuals. The obligation also extends beyond employees to any person performing work.
The primary duty is to ensure, so far as is reasonably practicable, the health and safety of workers while the workers are at work in the business or undertaking. The primary duty is also to ensure, so far as is reasonably practicable, that the health and safety of other persons is not put at risk from work carried out as part of the conduct of the business or undertaking. The primary duty of care also contains some expressly listed key obligations, for example, the provision and maintenance of a work environment that is without risks to health and safety.
The harmonised laws also impose health and safety duties on officers, workers and other persons at the workplace. Officers have a duty to exercise due diligence to ensure that the person conducting a business or undertaking complies with its duties or obligations. Workers and other persons at the workplace have the duty to take reasonable care for their own health and safety and the health and safety of others from their own actions, and to cooperate with the person conducting a business or undertaking to comply with the laws.
1.Complaint Procedures
To begin with, all workplace incidents must be recorded in a register of injuries and investigated within the workplace. The internal investigation, including the outcome, all work changes or risk controls put in place as a result, and communications to workers, should be documented.
If confronted with a workplace health or safety issue or incident that is not effectively resolved within the workplace, a report should be made to the State WHS body to assess the issue and commence an investigation, if need be.
If a serious incident occurs, the WHS body should be contacted immediately, or penalties will apply under the Model Laws.
When a serious incident has occurred, the WHS body may send inspectors to carry out investigations to determine exactly what caused the incident, the lessons learnt to improve workplace safety and prevent injuries and what action may be warranted. Under the Model Laws, the State WHS body has the ability to undertake regular site inspections of a workplace, implement improvements, and enforce prohibitions, penalty notices and enforceable undertakings to ensure the health and safety of workers. Inspectors also have both general and specific powers to enter workplaces and require production of documents to inspect and examine, at any time.
WHS bodies can also commence prosecutions under the Model Laws and the relevant state Criminal legislation against individuals, employers or businesses who have breached WHS laws. A person can specifically request a prosecution if they believe a serious offence under the Model Laws has occurred, and a prosecution has not yet occurred in the six months (but no later than 12 months) following the incident.
2.Protection from Retaliation
The Model Laws provide for protection from ‘discriminatory conduct’, for “prohibited reasons” in the workplace. “Discriminatory conduct” covers actions such as dismissal, termination, causing detriment to a worker, and treating the worker less favourably than another worker. The “prohibited reasons” include that the worker is, or is proposed to be, a health and safety representative in their workplace, exercises a power or function under the Model Laws, or raises an issue or concern about work health and safety. In addition, it is prohibited for a person to request, instruct, induce, encourage, authorise or assist another person to engage in discriminatory conduct, and to organise or take action against another person with intent to coerce or induce them to take such action against another person.
The penalty for engaging in discriminatory conduct for a prohibited reason under the Model Laws as at 1 August 2023 is $139,000 for an individual and $695,000 for a body corporate. Both civil and criminal proceedings are available, and the court may make orders for compensation in criminal proceedings if a person is convicted or found guilty of an offence under this part of the Model Laws.
