Award Interpretation is Complex and Requires Carfull Consideration of you Payroll Processes
Payroll will need to come to grips with the new requirements of the Better Off Overall Test (BOOT).
The key is at the instigation of an EBA; the FWC will consider the impact of the over rather than line-by-line conditions proposed in the EBA against the Award overall. The benefit may be that if there are some non-financial benefits in the EBA, they may be considered in the overall test.
The risk may be that if a non-financial benefit is provided in the Award, the EBA will need to consider including them or offsetting them against some other particular benefit in the EBA.
Maipen Blog covers the requirements.
https://www.mapien.com.au/blog/better-off-overall/
The Fair Work Commicsion can backdate adittional provisions previously allowable.
The FWC can revisit an EBA if factors come to light that was not considered at the establishment of the agreement. The variation may also be back-dated and could create a back pay requirement.
The simplicity of an automated process comparing your EBA with the Award conditions at each pay run may be effective in ensuring compliance with the BOOT and highlighting where operational changes may need to be made to avoid the risk of increased costs, backpays and penalties.
The Inzenius system will facilitate the concurrent comparison of every employee’s actual pay to the appropriate award
How will this work?
During the pay run process, the timesheets automated Payroll Award Interpretation based on the configured business EBA will be re-run against the Award.
A comparative report highlighting differences will be presented for each pay run for each employee and in department and business aggregate.
This will provide the identification of actionable steps for management to undertake and evidence if a claim is made of failing the BOOT.
#ThatsInzenius Data is a powerful tool
Recent Award Complexities Added in the Past 12 months
The Australian Industrial Environment is complex and over the time of the new Labour government many new rules have already been added but none removed.
Professional Services Salaried Employees Overtime Rules
Overtime for salaried employees is on its way with the determination by Fairwork to apply overtime and penalty loadings in the Professional Services Award . “ A penalty rate of 125% will be payable (and)The employer must keep records of all hours worked by an employee in excess of 38 per week, or worked before 6.00 am or after 10.00 pm on any day Monday to Saturday, or worked at any time on a Sunday or public holiday”. Simon Obee EL Legal.
Time keeping and/or at least compliant timesheet sheet records are a must.
The ramification of this is currently for the employees under the professional services that are not designated as management include:
The need to keep times worked records for all hours in and out of the office.
The tracking of all times worked outside of 38 hours per week
The tracking and recording of time worked before 6.00 am or after 10.00 pm on any day
The tracking and recording of times worked on a Saturday, Sunday or Public Holiday.
The award interpretation of all times worked outside of the standard 38 hrs Mon to Fri.
These times outside of the standard Mon to Fri will accrue a 25% pay loading on the employee base rate for the times worked in the above periods.
Keep timesheet records from all your employees for even time worked outside of the office that will qualify for these overtime penalties. The process of timekeeping or timesheets is a requirement and should be collated daily to avoid delays in payroll processing.
HIGA and Restaurant Award for Annualised Salary Employees
Annualised Salaries for HIGA and Restaurant Awards require these employees to be compare their pay they received to the award and if they are required to paid any sift penalties over 18 hours per week or overtime penalties over 12 hours per week in addition to their loaded salary of at least 25% above the award.
This requires re-calculating each of these employee’s pay to accommodate these provisions. #ThatsInzenius
Victoria’s Wage Theft Laws on Payroll Award Interpretation Compliance.
It Has Become a Crime For Employers in Victoria and Queensland to:
- deliberately and dishonestly underpay employees.
- deliberately and dishonestly withhold wages, superannuation or other employee entitlements.
- falsify employee entitlement records to gain a financial advantage.
- avoid keeping employee entitlement records to gain a financial advantage.
These crimes are punishable by a fine of up to $218,088 or up to 10 years jail for individuals and a fine of up to $1,090,440 for companies.
On top of these penalties, current and past employees are to be paid underpayments discovered for up to 6 years.
The ability to automate payroll form the approved timesheets and undertake analysis of the employees pays in comparison the award is a must
Many more Award Interpretation rules are expected to follow these examples but the trend is clear
Payroll must past the Better Off Overall Test at the establishment of the EBA and pass the test of employees pays each pay period based on comparison the Award conditions and payments.
Inzenius automated Payroll Interpretation from each employees Timesheet with the added feature of comparative analysis to the Award is the way to go. #ThatsInzenius