DETERMINATION

Fair Work Act 2009
s.156—4 yearly review of modern awards

4 yearly review of modern awards—Annualised Wage Arrangements
(AM2016/13)

HYDROCARBONS INDUSTRY (UPSTREAM) AWARD 2020
[MA000062]

Review of annualised salary provisions in modern awards - Hydrocarbons Industry (Upstream) Award 2020.

A. Further to the Full Bench decisions [2019] FWCFB 4368 and [2019] FWCFB 8583 issued by the Fair Work Commission, the above award is varied as follows:

1. By renumbering clause 18.2 as clause 19.

2. By deleting clause 18 and inserting the following:

18. Annualised wage arrangements

18.1 Annualised wage instead of award provisions

(a) An employer may pay a full-time employee an annualised wage in satisfaction, subject to clause 18.1(c), of any or all of the following provisions of the award:

(i) clause 16—Minimum rates;

(ii) clause 19—Allowances;

(iii) clause 22—Overtime;

(iv) clause 23—Penalty rates; and

(v) clause 24.5(b)—annual leave loading only.

(b) Where an annualised wage is paid the employer must advise the employee in writing, and keep a record of:

(i) the annualised wage that is payable;

(ii) which of the provisions of this award will be satisfied by payment of the annualised wage;

(iii) the method by which the annualised wage has been calculated, including specification of each separate component of the annualised wage and any overtime or penalty assumptions used in the calculation; and

(iv) the outer limit number of ordinary hours which would attract the payment of a penalty rate under the award and the outer limit number of overtime hours which the employee may be required to work in a pay period or roster cycle without being entitled to an amount in excess of the annualised wage in accordance with clause 18.1(c).

(c) If in a pay period or roster cycle an employee works any hours in excess of either of the outer limit amounts specified pursuant to clause 18.1(b)(iv), such hours will not be covered by the annualised wage and must separately be paid for in accordance with the applicable provisions of this award.

18.2 Annualised wage not to disadvantage employees

(a) The annualised wage must be no less than the amount the employee would have received under this award for the work performed over the year for which the wage is paid (or if the employment ceases earlier over such lesser period as has been worked).

(b) The employer must each 12 months from the commencement of the annualised wage arrangement or upon the termination of employment of the employee calculate the amount of remuneration that would have been payable to the employee under the provisions of this award over the relevant period and compare it to the amount of the annualised wage actually paid to the employee. Where the latter amount is less than the former amount, the employer shall pay the employee the amount of the shortfall within 14 days.

(c) The employer must keep a record of the starting and finishing times of work, and any unpaid breaks taken, of each employee subject to an annualised wage arrangement for the purpose of undertaking the comparison required by clause 18.2(b). This record must be signed by the employee, or acknowledged as correct in writing (including by electronic means) by the employee, each pay period or roster cycle.

18.3 Base rate of pay for employees on annualised wage arrangements 

For the purposes of the NES, the base rate of pay of an employee receiving an annualised wage under this clause comprises the portion of the annualised wage equivalent to the relevant rate of pay in clause 16—Minimum rates and excludes any incentive-based payments, bonuses, loadings, monetary allowances, overtime and penalties.

3. By renumbering clauses 19 to 32 as clauses 20 to 33.

4. By deleting the words “annualised salaried” and “annualised salary” wherever they appear in Schedule I—Part-day Public Holidays and inserting “annualised wage arrangement”.

5. By updating the table of contents and cross-references accordingly.

B. This determination comes into operation from 1 March 2020. In accordance with s.165(3) of the Fair Work Act 2009 these items do not take effect until the start of the first full pay period that starts on or after 1 March 2020.

VICE PRESIDENT

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