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Setting the Standard
Posted: 28/05/2010
On 1 January 2010, significant changes were made to the employment landscape in Australia as the Modern Awards came into operation as part of the Fair Work Act 2009 (Cth) (the “Act”). The Act contains two distinct elements in respect of the minimum standards of employment for all employees in Australia, namely, the National Employment Standards (“Standards”) and Modern Awards.
The Standards comprise 10 minimum standards of employment that apply across all industries and specify, among others things:
• maximum weekly hours of work;
• minimum personal leave entitlements;
• minimum annual leave entitlements;
• termination requirements; and
• redundancy requirements.
The Modern Awards are designed to supplement the Standards. Whilst the Standards provide for minimum standards across all industries, the Modern Awards specify the minimum entitlements which apply to a specific industry of employment.
For example, the Real Estate Industry Award 2010 (“RE Award”) is the Modern Award specific to the real estate industry. The RE Award specifies, amongst other things:
• the minimum weekly wage entitlement of an employee;
• the employee’s entitlement to a commission, bonus or incentive payment; and
• the employee’s entitlement to reimbursement for the use of their mobile phones and/or motor vehicles in the course of their employment.
Employers are encouraged by Fair Work Australia to review and update their employment contracts to ensure that their agreements are compliant with the Standards and Modern Awards. Penalties of up for $6,600 for an individual and $33,000 for a corporation may apply for a breach of a provision in the Standards or Modern Awards.
If you require assistance in complying with the Standards and Modern Awards, please contact us.
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