We briefly outline below the changes relating to employment that apply on or around 1 July.
Minimum Wage and Award Rates
The National Minimum Wage and the rate in Awards has been increased by 1.75 per cent however the starting date varies depending on the applicable Award. There are three start dates with the increase applying to the first tranche of Awards to be affected from the first pay period after 1 July 2020, the second tranche commences from the first pay period after 1 November 2020, and the third tranche commences from the first pay period after 1 February 2021. This does not affect companies that are paying employees above those rates for their classifications. For information on the list of starting dates for each Award, see the Fair Work Ombudsman site.
For organisations that still come under the Western Australian Awards in the WA industrial relations system, the WA Industrial Relations Commission issued the 2020 State Wage Case decisions which grants a 1.75 per cent per week increase in WA award rates of pay from the first pay period on or after 1 January 2021. See the Commerce WA website for further information.
Paid Parental Leave Scheme
The Federal Government’s paid parental leave scheme for primary carers, which provides 18 weeks’ paid leave at the national minimum wage, has been amended to provide greater flexibility. Under the amendments, an eligible employee must take the first 12 weeks of parental leave pay (PLP) in one continuous block within 12 months of the child’s birth or adoption, but the remaining 30 working days of PLP can now be taken on any day within 24 months following the birth or adoption. This may cause some issues for companies in payroll arrangements where an employee chooses to exercise that flexibility and so will be paid at a different rate (the minimum wage rate) when they take a day or days of PLP. For further information see the Fair Work Ombudsman site.
Unpaid Pandemic Leave Entitlement Ends
The Fair Work Commission inserted a temporary entitlement to unpaid pandemic leave into a number of Awards earlier this year under the new Schedule X, with the entitlement ending on 30 June 2020. Staff needed to commence the leave before that date in order to qualify for up to two weeks of unpaid leave. At this point the Fair Work Commission has only extended the entitlement to a select few Awards although this may change. See the Fair Work site for which Awards have the leave eligibility extended and any further updates.
High Income Threshold – Access to Unfair Dismissal
An employee is not eligible to pursue an unfair dismissal claim if they earn more than the high income threshold (unless they are covered by a modern award or enterprise agreement). The high income threshold went up on the 1st of July to $153,600. The maximum compensation for unfair dismissal is the equivalent of six months pay at the high income threshold, now $76,800. For further information see the Fair Work Commission.
High Income Threshold – Application of Awards
In broad brush terms, if an employee’s classification or industry is covered by an award (for example the Clerks Private Sector or the Banking Finance and Insurance Industry Award), then the employee is covered by the conditions of that award, unless they are guaranteed (in writing) that their annual pay is in excess of the high income threshold. Employees who are covered by an award but who receive a guaranteed annual income above $153,600 will not be covered by the award conditions, however they are still able to pursue an unfair dismissal claim. For further information click here.
Victoria – Industrial Manslaughter
From 1 July 2020, the criminal offence of industrial manslaughter applies to negligent conduct by an employer or other duty holders, or an officer of an organisation, that breaches certain duties under the Occupational Health and Safety Act 2004 (Vic) (OHS Act) and causes the death of another person who was owed the duty.
The changes do not create additional duties; they introduce significantly tougher penalties on already existing duties under the OHS Act. The penalties have been increased to 25 years gaol and penalties of $16.5 million for employers. The offence of workplace manslaughter does not apply to a volunteer or an employee, unless the employee is also an officer of an organisation. The definition of an “officer” is taken from the Corporations Act and includes:
- a director or secretary of a corporation
- a person:
- who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business; or
- who has the capacity to affect significantly the entity’s financial standing; or
- in accordance with whose instructions or wishes the directors of a corporation are accustomed to act
- a partner in a partnership
- an office holder of an unincorporated association
For more information see WorkSafe Victoria.
WHS Changes in New South Wales
Insurers and those insured (i.e. companies/organisations and their officers) in NSW are now prohibited from entering into insurance contracts that indemnify an insured for monetary penalties under the Work Health and Safety Act 2011 (NSW).
The New South Wales Government has also introduced the ‘gross negligence offence’ where it can be demonstrated that a PCBU:
- a) without reasonable excuse, engaged in conduct that exposed workers or other persons to a risk of death, serious injury or illness; and
- b) engaged in the conduct with gross negligence.
Previously this type of Category 1 offence required reckless conduct (which requires evidence of some foresight of the risk); this extends the offence to cover conduct which is grossly negligent. For further information see Safe Work NSW.
While too numerous to mention, be aware that many penalties and fees under the Fair Work Act and workplace safety laws are indexed and so are likely to have increased on 1 July 2020.
Very best wishes to all for a safe and compliant 20/21.