Employment Relations -Business Improvement Update
WHAT ARE THE CHANGES? Clause 24 of the HIGA will be changed to:
The Fair Work Commission has varied the Hospitality Industry (General) Award 2020 (HIGA) terms that relate to non-managerial annualised wage arrangements under clause 24. Effective from September 1, annualised wage arrangements for these employees will be fundamentally altered. Key details of these changes are outlined below.
• Require the separate payment to employees, in addition to the amount of annualised salary paid, when “outer limits” of penalty rates and overtime are exceeded in a particular pay period. • Require employers to conduct a reconciliation every 12 months or upon termination of employment, calculating the difference between what the employee would have earned in separate entitlements compared to salary paid, with any shortfall being back paid with 14 days. CHANGES TO HIGA ANNUALISED WAGE ARRANGEMENTS • Require annualised salary agreements to specify certain details, including the amount of annualised wage, the award entitlements that the salary includes, and the outer limits that apply. • Require additional records to be maintained. • No longer require time in lieu for time worked on public holidays to be provided. OUTER LIMITS The HIGA will introduce “outer limits” of penalty rates and overtime hours. These outer limits are:
WHAT
IS
AN
ANNUALISED
WAGE
ARRANGMENT? An annualised wage arrangement, also known as an annualised salary, is a way of paying an employee whereby an agreement is made that a fixed annual wage is paid, that will renumerate the employee for some or all the separate payments they would be entitled to under an Award (e.g. hours of work, penalty rates, overtime, allowances, loadings etc.).
• The HIGA provides for two different salary arrangements, at clause 24 and 25.
• Clause 24 relates to all classifications other than Managerial Staff (Non-Managerial), and clause 25 relates to Managerial Staff only.
WHO DO THE CHANGES APPLY TO?
• The changes relate to clause 24 of the HIGA, that is, only in relation to non-Managerial employees. • No changes have been made to clause 25 of the HIGA, which provides for a Managerial exemption arrangement. • As the changes are being made to the HIGA, employees covered by an Enterprise Agreement are not immediately affected. Although the changes could be relevant in future Enterprise Agreement negotiations and approvals.
• More than 18 penalty rate hours per week; or • More than 12 overtime hours per week.
Note that “Penalty Rate Hours” for this clause means ordinary hours worked Saturdays, Sundays, Public Holidays, and midnight – 7am on weekdays, but excludes hours worked between 7pm to midnight on weekdays. The weekly limits specified may be averaged over a period of up to four weeks if the employer operates a roster cycle over such a period.
• Similar changes have taken effect from September 1 in relation to the Restaurant Industry Award 2020.
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