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

4 yearly review of modern awards - common issue - award flexibility - time off instead of payment for overtime – finalisation of plain language model term.

1. Introduction

[1] On 24 April 2016 we issued a decision 1 (the April 2016 decision) which proposed the variation of 26 modern awards (set out at Attachment D to the April 2016 decision)2 to insert a plain language model term (the April 2016 model term) and the associated Schedule containing a template agreement. The April 2016 model term was a plain language redraft of the October 2015 model term.

[2] The draft variation determinations were published on 9 May 2016 and interested parties were given a period of 14 days in which to comment. The publication of the draft variation determinations also provided any interested party with an opportunity to comment on the April 2016 model term. This decision deals with the submissions received in relation to these issues and finalises the model term.

2. The Submissions

[3] Submissions in relation to the April 2016 model term were received from:

● Australian Industry Group (Ai Group);
● Australian Manufacturing Workers’ Union (AMWU);
● Master Electricians Australia (MEA); and
● National Farmers’ Federation (NFF).

[4] It is convenient to deal first with the submission advanced by MEA as it raises a discrete issue.

[5] MEA submits that the model term should be amended to make clear that accrued time off may be utilised during a period of stand down under s.524 of the Fair Work Act 2009 (Cth) (the Act). In particular, MEA proposes that a new subclause A.1(1) be inserted into the model term, as follows:

“An employee may, during a period of employer initiated stand down in accordance with section 524 of the Act, request to utilise any or all outstanding accrued TOIL at a time for time basis.”

[6] In the alternative, MEA submits that the Fair Work Commission (the Commission) should clarify that accrued time off may be utilised by an employee during a period of stand down.

[7] Section 524 of the Act provides that in certain circumstances an employer may stand down an employee during a period in which the employee cannot be fully employed. If an employer stands down an employee pursuant to s.524(1) then the employer is not required to make payments to the employee for that period (s.524(3)).

[8] It is unclear how the MEA’s proposal is intended to operate. If the intention is that the employee would not be paid for that time off (relying on s.524(3)), then such a proposal is inimical to the nature and purpose of the model term. If the employee would be paid while taking time off instead of payment for overtime rather than being stood down, then that can be done under the model term as it currently stands. The model term makes it clear that time off instead of payment for overtime can be taken at a time or times agreed by the employee and employer. Accordingly the variation sought is unnecessary.

[9] The submissions advanced by Ai Group, the AMWU and the NFF suggest particular changes to the April 2016 model term. The various submissions are summarised in Attachment A of this decision. It is convenient to deal with these submissions on a paragraph by paragraph basis.

A.1 Time off instead of payment for overtime

(a) An employee and employer may agree in writing to the employee taking time off instead of being paid for a particular amount of overtime that has been worked by the employee.

[10] Ai Group and the NFF submit that the expression ‘time off in lieu of overtime’ (abbreviated as ‘TOIL’) should be retained, rather than the expression ‘time off instead of overtime’, which appears in the April 2016 model term. Ai Group 3 contends that:

‘The very widely used and understood abbreviation TOIL relates to the phrase “Time Off in Lieu”.

The notion of changing the wording of the phrase, but continuing to use the abbreviation “TOIL” is bound to confuse readers of awards.

The phrase “Time Off in Lieu” should be retained.’

[11] The NFF advances a similar point, submitting that: ‘the change may cause confusion among stakeholders familiar with the term TOIL, which is a generally well understood concept’. 4 The NFF also submits that:

‘Payroll systems which currently use the expression TOIL on payslips will require adjustment and this will create an administrative burden on business.’ 5

[12] We agree with the proposition that using the expression ‘time off instead of overtime’ while retaining the acronym ‘TOIL’ is likely to cause confusion. We also accept that some award users – particularly unions and employer organisations – are familiar with the acronym ‘TOIL’. But many employees and employers covered by modern awards are not members of unions or employer organisations. Modern awards need to be easily understood by those who are covered by them. As the Full Bench observed in the 13 July 2015 Award Review decision: 6

‘An award should be able to be read by an employer or employee without needing a history lesson or paid advocate to interpret how it is to apply in the workplace.’

[13] It is also relevant to note that 30 of the 115 modern awards which contain overtime provisions do not presently contain a ‘TOIL’ provision. The April 2016 decision determined that 26 of these 30 modern awards would be varied to insert the model term. It is likely that many of the employees and employers covered by these 26 modern awards have no familiarity with the acronym ‘TOIL’.

[14] Further, contrary to the NFF’s submission, we do not think that the change in terminology will ‘create an administrative burden on business’. The suggestion by the NFF that ‘payroll systems which currently use the expression TOIL on payslips will require adjustment’, is simply an assertion and lacks substance. Regulation 3.46 of the Fair Work Regulations 2009 sets out the information required to be included on payslips. There is no regulatory requirement to specify ‘TOIL’ on an employee’s payslip. Nothing in the model term requires any change to current payslip arrangements. It follows that if some employers choose to include this additional information on employees’ payslips then they may continue to use the acronym ‘TOIL’ if they wish.

[15] In our view ‘time off instead of payment for overtime’ more clearly conveys the concept dealt with in the model term. The expression ‘instead of’ is simpler and easier to understand than the expression ‘in lieu of’. We do not propose to revert to the latter expression. As the retention of the acronym ‘TOIL’ is likely to cause confusion, it will be deleted from the model term and the template agreement.

[16] We now turn to paragraph A.1(b):

(b) Any amount of overtime that has been worked by an employee in a particular pay period and that is to be taken as time off instead of the employee being paid for it must be the subject of a separate agreement under clause A.1.

[17] The NFF submits that this paragraph of the plain language redraft is more complex than the October 2015 model term. The comparable provision in the October 2015 model term said:

‘1.2 The following requirements apply to an agreement to take time off in lieu of payment for overtime:

(a) A separate written agreement must be made by the employee and employer for each occasion on which overtime that has been worked is to be taken as time off in lieu …’

[18] The NFF proposes replacing paragraph A.1(b) of the April 2016 model term with the following:

‘A separate written agreement must be made by the employee and employer for each pay period during which time off is taken instead of payment for overtime.”

[19] We do not propose to make the change sought. If read literally, the NFF proposal would require a separate written agreement to be made for each pay period in which the time off instead of payment is actually taken. This does not capture our intended meaning, that is, a separate agreement must be made for any overtime worked in a particular pay period in which it is agreed that time off instead of payment will, at some time in the future, be taken.

[20] We now turn to paragraph A.1(c):

(c) An agreement must state each of the following:

• that, if the employee requests at any time, the employer must pay the employee, for overtime covered by the agreement but not taken as time off, at the overtime rate applicable to the overtime when worked;



• that any payment mentioned in subparagraph (iii) must be made in the pay period immediately following the request.



• An example of the type of TOIL agreement required by this clause is set out at Schedule [x]. There is no requirement to use the form of TOIL agreement set out at Schedule [x]. A TOIL agreement can also be made by an exchange of emails between the employee and employer, or by other electronic means.

[21] Two changes are proposed in respect of subparagraph A.1(c)(iv). First, the NFF submits that the reference to ‘the request’ should specify that it is the employee’s request.

[22] The change proposed is unnecessary. There is only one request mentioned in the paragraph, namely the employee’s. It is clear from the context that the request referred to in subparagraph A.1(c)(iv) is the employee’s request.

[23] Second, Ai Group proposes that ‘next’ be inserted before ‘pay period’ because the current draft could be interpreted as requiring payment to be made in the same pay period as the employee’s request.

[24] The intention of subparagraph A.1(c)(iv) is to require payment in the first pay period commencing after the employee’s request. To address the issue raised by Ai Group we will insert the word ‘next’ and remove the word ‘immediately’, so that the phrase becomes: ‘in the next pay period following the request’. Similar changes will be made to paragraphs A.1(f) and A.1(g) and to the template agreement.

[25] In relation to the note under subparagraph A.1(c)(iv), the AMWU submits that it should be clarified such that if an ‘exchange of emails’ is used to give effect to an agreement (rather than the template agreement), then the requirements of paragraph A.1(c) must still be met. The AMWU proposes that the following be inserted at the end of the last sentence:

‘provided the exchange of emails or other electronic means sets out the required matters in subparagraphs (c)(i)-(iv)’.

[26] We do not consider that a change to the extent proposed is necessary to provide the clarification sought. The position will be clarified by simply referring to an agreement ‘under clause A.1’, thus importing all of the requirements of such an agreement. Further, as proposed by the NFF, references to ‘TOIL’ will be removed from the note, as the acronym no longer reflects the wording of the clause. Addressing both of these issues, the note will be reworded as follows:

‘NOTE: An example of the type of agreement required by clause A.1 is set out at Schedule [x]. There is no requirement to use the form of agreement set out at Schedule [x]. An agreement under clause A.1 can also be made by an exchange of emails between the employee and employer, or by other electronic means.’

[27] We now turn to paragraph A.1(d):

(d) The period of time off that an employee is entitled to take is the same as the number of overtime hours worked.

EXAMPLE: An employee who worked 2 overtime hours is entitled to time off of 2 hours.

[28] The NFF submits that this paragraph of the plain language redraft is more complex than the original term and that the change could result in a change of meaning. The NFF proposes that paragraph A.1(d) be replaced with the comparable provision in the October 2015 model term or that ‘ordinary time rate’ be replaced with ‘ordinary hourly rate’ or an equivalent term used in the relevant modern award.

[29] The comparable provision in the October 2015 model term said:

‘(b) Overtime taken as time off during ordinary hours shall be taken at the ordinary time rate; that is, an hour taken for each overtime hour worked’

[30] We do not propose to revert to the previous provision. The plain language provision makes it clear that the amount of time off is the amount of overtime worked, regardless of when the overtime is worked or the time off is taken. The suggested inclusion of a reference to ‘rates’ – whether the ‘ordinary time rate’ or ‘ordinary hourly rate’ – suggests payment rather than time off instead of payment and obscures the meaning of the provision.

[31] The NFF also submits that because the entitlement to time off instead of overtime only operates where there is agreement, this should be reflected in the example, if the example is retained, as follows:

‘EXAMPLE: An employee who worked 2 overtime hours can agree to take 2 hours’ time off.’

[32] We agree with the proposition that the entitlement to time off instead of payment only arises where there is an agreement to that effect. But the agreement must be an agreement under the model term. We will amend the example as follows:

‘EXAMPLE: By making an agreement under clause A.1 Aan employee who worked 2 overtime hours is entitled to 2 hours’ time off.’

[33] We now turn to paragraph A.1(e):

(e) Time off must be taken:

(i) within the period of 6 months after the overtime is worked; and

(ii) at a time or times within that period of 6 months agreed by the employee and employer.

[34] The NFF submits that the ‘plain language version of this clause does not deal with the amount of time to be taken, and that it is not necessary to always refer to “the/that period of 6 months”.’ The NFF proposes that paragraph A.1(e) be reworded as follows:

‘(e) The agreed amount of time off must be taken:

(i) at a time or times agreed between the employee and employer; and
(ii) within 6 months of the overtime being worked.’

[35] We do not consider the NFF’s proposed rewording to be clearer than the plain language version. Accordingly, no change will be made to paragraph A.1(e).

[36] We now turn to paragraph A.1(f) (with the change already noted at paragraph [24] above):

(f) If the employee requests at any time to be paid for overtime covered by an agreement under clause A.1 but not taken as time off, the employer must pay the employee for the overtime, in the next pay period immediately following the request, at the overtime rate applicable to the overtime when worked.

[37] The comparable provision in the October 2015 model term contained the prefatory words ‘Notwithstanding any other provision of clause 1.2’. The NFF seeks to retain these words, but replacing ‘notwithstanding’ with ‘despite’. In support of its proposal, the NFF submits:

‘While the word ‘notwithstanding may be considered archaic, it does have legal meaning. To avoid potentially inadvertent consequences from its omission, consideration could be given to replacing the term with the term ‘despite’.’

[38] The expression ‘Notwithstanding (or despite) any other provision of clause A.1’ is not required in the plain language version as paragraph A.1(f) expressly provides for the effect of a payment request. The expression was deleted because it is unnecessary; no other consequences are intended.

[39] We now turn to paragraph A.1(i):

(i) An employer must not exert undue influence or undue pressure on an employee to make, or not make, an agreement under clause A.1.

[40] The NFF submits that the plain language version of this paragraph is narrower in scope than the comparable provision in the October 2015 model term, which said:

‘1.4 An employer must not exert undue influence or undue pressure on an employee in relation to a decision by the employee to make, or not make, an agreement to take time off in lieu of payment for overtime.’

[41] We agree with the NFF. The wording in the October 2015 model term more closely matched the wording of s.344 of the Act. In order to maintain the same scope of protection, we will amend paragraph A.1(i), as shown:

‘(i) An employer must not exert undue influence or undue pressure on an employee in relation to a decision by the employee to make, or not make, an agreement to take time off instead of payment for overtime under clause A.1.’

[42] We now turn to paragraph A.1(j):

(j) An employee may, under section 65 of the Fair Work Act, request to take time off, at a time or times specified in the request or to be subsequently agreed by the employer and the employee, instead of being paid for overtime worked by the employee. Clause A.1 applies to any such time off granted by the employer as if it were time off covered by an agreement under clause A.1.

Note: If an employee makes a request under section 65 of the Fair Work Act for a change in working arrangements, the employer may only refuse that request on reasonable business grounds (see section 65(5) of the Fair Work Act).

[43] The NFF advances two points in relation to paragraph A.1(j). First, it submits that as ‘the Act’ is defined term in all modern awards it does not need to be referenced in full in the model term. Second, the NFF submits:

‘The words “as if it were time off covered by an agreement under…” could be removed, given that despite the request being made under section 65, it will also be covered by a written agreement under [the] proposed clause.’

[44] The AMWU submits that paragraph A.1(j) should make a more direct reference to the request for flexible working arrangements, as opposed to simply referring to s.65 of the Act. To that end, the AMWU suggested paragraph A.1(j) be amended to read as follows:

‘If an employee makes a request for flexible working arrangements under s. 65 of the Fair Work Act, and the request is to take time off instead of being paid overtime, clause A.1 applies to any such time off granted by the employer as if it were time off covered by an agreement under clause A.1.’

[45] The AMWU also submits that the note immediately following paragraph A.1(j) should, in addition to mentioning that an employer may only refuse a request for flexible working arrangements on reasonable business grounds, refer to the obligation for an employer to accept or refuse a request for flexible working arrangements within 21 days of receiving the request. The amended note would read as follows (emphasis added):

Note: If an employee makes a request under section 65 of the Fair Work Act for a change in working arrangements, the employer may only refuse that request on reasonable business grounds (see section 65(5) of the Fair Work Act) and must provide a written response to the request within 21 days.

[46] Under ss.65(1) and 65(1A) of the Act, an employee may request a change in his or her working arrangements in a range of circumstances, namely, because the employee:

• is the parent, or has responsibility for the care, of a child who is of school age or younger;



• is a carer (within the meaning of the Carer Recognition Act 2010);



• has a disability;



• is 55 or older;



• is experiencing violence from a member of the employee’s family; or



• provides care or support to a member of his or her immediate family or a member of his or her household who requires care or support because the member is experiencing violence from the member’s family.

[47] Subsection 65(2) limits the class of employees entitled to request a change in their working arrangements.

[48] Requests for a change in working arrangements must be in writing and set out the details of the change sought and the reasons for the change (s.65(3)). The employer must provide a written response within 21 days stating whether the employer grants or refuses the request (s.65(4)). If the request is refused, the written response must include details of the reasons for the refusal (s.65(6)). Subsection 65(5) provides that the employer may only refuse a request ‘on reasonable business grounds’. A non-exhaustive list of ‘reasonable business grounds’ is set out in s.65(5A).

[49] As noted above, the NFF submits that the ‘words “as if it were time off covered by an agreement under…” could be removed, given that despite the request being made under section 65, it will also be covered by a written agreement under [the] proposed clause.’

[50] The interaction between a s.65 agreement and the model term was discussed at length in the 16 July 2015 Award Flexibility decision (the July 2015 decision). 7 It followed from this analysis that a s.65 agreement could only provide for time off instead of payment for overtime if this was permitted under a specific award clause, as a s.65 agreement could not of itself trade off an overtime payment entitlement under the award for time off (whether on a time for time basis or otherwise).

[51] The Full Bench decided through an abundance of caution to insert subclause 1.3 (now paragraph A.1(j)) to make clear an employer’s obligations where a request for time off instead of payment for overtime is made pursuant to s.65. In particular, that a request for a change to working arrangements in accordance with s.65 can only be refused on reasonable business grounds. 8

[52] As the Full Bench has previously observed, in the absence of an award clause for time off instead of payment for overtime, it would not be possible through a s.65 agreement to trade off an entitlement to payment for time off. In other words, the issue is not about the extent to which s.65 agreements should be constrained by the model term, but rather the extent to which they should be allowed additional effect under it.

[53] As a s.65 agreement for time off instead of payment for overtime relies upon the award clause for its operation, there is no obvious policy rationale for a s.65 agreement having lesser safeguards than the award clause. Indeed it would be somewhat anomalous if those employees who are entitled under s.65 to request a change in their working arrangements because of their particular circumstances, were afforded a lesser level of protection than employees generally.

[54] Further, if an employee and employer wish to enter into an ongoing arrangement for time off instead of payment for overtime without having to make separate agreements for each pay period, then they may seek to make an individual flexibility arrangement (IFA). As the Full Bench observed in the July 2015 decision: ‘It is common ground that TOIL … fall[s] within the scope of the model flexibility term in modern awards and accordingly could potentially be the subject of an IFA’. 9

[55] As suggested by the NFF, it is proposed to vary paragraph A.1(j) to make clear that all of the requirements of clause A.1 apply to an arrangement to take time off instead of payment for overtime that has been worked that is made under s.65 of the Act. We also agree with the NFF’s observation that it is unnecessary to reference ‘the Act’ in full, as this is a defined term in all modern awards. This change will also be made in the notes following paragraphs A.1(j) and A.1(k).

[56] As to the matters raised by the AMWU, it is important to bear in mind that the paragraph is not intended to be a complete reflection of the various elements of s.65. We do not think it is necessary to reword the plain language paragraph in the manner proposed.

[57] The revised paragraph A.1(j) and note will provide as follows:

(j) An employee may, under section 65 of the Act, request to take time off, at a time or times specified in the request or to be subsequently agreed by the employer and the employee, instead of being paid for overtime worked by the employee. If the employer agrees to the request then clause A.1 will apply, including the requirement for separate written agreements under paragraph (b) for overtime that has been.

NOTE: If an employee makes a request under section 65 of the Act for a change in working arrangements, the employer may only refuse that request on reasonable business grounds (see section 65(5) of the Act).

[58] We now turn to paragraph A.1(k):

(k) If, on the termination of the employee’s employment, time off for overtime worked by the employee to which clause A.1 applies has not been taken, the employer must pay the employee for the overtime at the overtime rate applicable to the overtime when worked.

Note: Under section 345(1) of the Act, a person must not knowingly or recklessly make a false or misleading representation about the workplace rights of another person under clause A.1.

[59] The comparable provision in the October 2015 model term said:

‘If, upon termination of employment, an employee has an accrued entitlement to take time off in lieu of payment for overtime which the employee has not yet used, the employee must be paid for the overtime at the overtime rate applying to the overtime worked.’ (emphasis added)

[60] The NFF submits that the phrase ‘applicable to the overtime when worked’ is slightly different to the phrase ‘applying to the overtime worked’ and could inadvertently change the meaning of the provision if it was construed to introduce a new ‘point in time’ element to the paragraph.

[61] Our intention is that the employee be paid at the same rate as the employee would have been paid for the overtime when it was worked. Contrary to the NFF’s submission, both the October 2015 and plain language versions of the model term have the same meaning 10 and both were intended to introduce a ‘point in time’ element.

3. Conclusion

[62] We propose to vary the April 2016 model term in the manner set out in this decision. A marked up version of the April 2016 model term is set out at Attachment B and the final version of the model term and template agreement are set out at Attachment C of this decision.

[63] The 26 modern awards set out at Attachment D to the April 2016 decision will be varied to insert the model term and associated schedule. Draft variation determinations will be published shortly. Interested parties will have 7 days to comment on the draft variation determinations.

PRESIDENT

Attachment A— Summary of submissions received in relation to the April 2016 model term for time off instead of payment for overtime

Attachment B— Marked up version of the Model term

A.1 Time off instead of payment for overtime

(a) An employee and employer may agree in writing to the employee taking time off instead of being paid for a particular amount of overtime that has been worked by the employee.

(b) Any amount of overtime that has been worked by an employee in a particular pay period and that is to be taken as time off instead of the employee being paid for it must be the subject of a separate agreement under clause A.1.

(c) An agreement must state each of the following:

(i) the number of overtime hours to which it applies and when those hours were worked;

(ii) that the employer and employee agree that the employee may take time off instead of being paid for the overtime;

(iii) that, if the employee requests at any time, the employer must pay the employee, for overtime covered by the agreement but not taken as time off, at the overtime rate applicable to the overtime when worked;

(iv) that any payment mentioned in subparagraph (iii) must be made in the next pay period immediately following the request.

Note: An example of the type of TOIL agreement required by this clause is set out at Schedule [x]. There is no requirement to use the form of TOIL agreement set out at Schedule [x]. A TOIL An agreement under clause A.1 can also be made by an exchange of emails between the employee and employer, or by other electronic means.

(d) The period of time off that an employee is entitled to take is the same as the number of overtime hours worked.

EXAMPLE: By making an agreement under clause A.1 Aan employee who worked 2 overtime hours is entitled to time off 2 hours’ time off.

(e) Time off must be taken:

(i) within the period of 6 months after the overtime is worked; and

(ii) at a time or times within that period of 6 months agreed by the employee and employer.

(f) If the employee requests at any time to be paid for overtime covered by an agreement under clause A.1 but not taken as time off, the employer must pay the employee for the overtime, in the next pay period immediately following the request, at the overtime rate applicable to the overtime when worked.

(g) If time off for overtime that has been worked is not taken within the period of 6 months mentioned in paragraph (e), the employer must pay the employee for the overtime, in the next pay period immediately following those 6 months, at the overtime rate applicable to the overtime when worked.

(h) The employer must keep a copy of any agreement under clause A.1 as an employee record.

(i) An employer must not exert undue influence or undue pressure on an employee in relation to a decision by the employee to make, or not make, an agreement to take time off instead of payment for overtime. under clause A.1.

(j) An employee may, under section 65 of the Fair Work Act Act, request to take time off, at a time or times specified in the request or to be subsequently agreed by the employer and the employee, instead of being paid for overtime worked by the employee. If the employer agrees to the request then clause A.1 will apply, including the requirement for separate written agreements under paragraph (b) for overtime that has been worked. Clause A.1 applies to any such time off granted by the employer as if it ere time off covered by an agreement under clause A.1.

Note: If an employee makes a request under section 65 of the Fair Work Act Act for a change in working arrangements, the employer may only refuse that request on reasonable business grounds (see section 65(5) of the Fair Work Act Act).

(k) If, on the termination of the employee’s employment, time off for overtime worked by the employee to which clause A.1 applies has not been taken, the employer must pay the employee for the overtime at the overtime rate applicable to the overtime when worked.

Note: Under section 345(1) of the Fair Work Act Act, a person must not knowingly or recklessly make a false or misleading representation about the workplace rights of another person under clause A.1.

Attachment C— Final model term and template agreement

A.1 Time off instead of payment for overtime

(a) An employee and employer may agree in writing to the employee taking time off instead of being paid for a particular amount of overtime that has been worked by the employee.

(b) Any amount of overtime that has been worked by an employee in a particular pay period and that is to be taken as time off instead of the employee being paid for it must be the subject of a separate agreement under clause A.1.

(c) An agreement must state each of the following:

(i) the number of overtime hours to which it applies and when those hours were worked;

(ii) that the employer and employee agree that the employee may take time off instead of being paid for the overtime;

(iii) that, if the employee requests at any time, the employer must pay the employee, for overtime covered by the agreement but not taken as time off, at the overtime rate applicable to the overtime when worked;

(iv) that any payment mentioned in subparagraph (iii) must be made in the next pay period following the request.

Note: An example of the type of agreement required by this clause is set out at Schedule [x]. There is no requirement to use the form of agreement set out at Schedule [x]. An agreement under clause A.1 can also be made by an exchange of emails between the employee and employer, or by other electronic means.

(d) The period of time off that an employee is entitled to take is the same as the number of overtime hours worked.

EXAMPLE: By making an agreement under clause A.1 an employee who worked 2 overtime hours is entitled to 2 hours’ time off.

(e) Time off must be taken:

(i) within the period of 6 months after the overtime is worked; and

(ii) at a time or times within that period of 6 months agreed by the employee and employer.

(f) If the employee requests at any time to be paid for overtime covered by an agreement under clause A.1 but not taken as time off, the employer must pay the employee for the overtime, in the next pay period following the request, at the overtime rate applicable to the overtime when worked.

(g) If time off for overtime that has been worked is not taken within the period of 6 months mentioned in paragraph (e), the employer must pay the employee for the overtime, in the next pay period following those 6 months, at the overtime rate applicable to the overtime when worked.

(h) The employer must keep a copy of any agreement under clause A.1 as an employee record.

(i) An employer must not exert undue influence or undue pressure on an employee in relation to a decision by the employee to make, or not make, an agreement to take time off instead of payment for overtime.

(j) An employee may, under section 65 of the Act, request to take time off, at a time or times specified in the request or to be subsequently agreed by the employer and the employee, instead of being paid for overtime worked by the employee. If the employer agrees to the request then clause A.1 will apply, including the requirement for separate written agreements under paragraph (b) for overtime that has been worked.

Note: If an employee makes a request under section 65 of the Act for a change in working arrangements, the employer may only refuse that request on reasonable business grounds (see section 65(5) of the Act).

(k) If, on the termination of the employee’s employment, time off for overtime worked by the employee to which clause A.1 applies has not been taken, the employer must pay the employee for the overtime at the overtime rate applicable to the overtime when worked.

Note: Under section 345(1) of the Act, a person must not knowingly or recklessly make a false or misleading representation about the workplace rights of another person under clause A.1.

AGREEMENT FOR TIME OFF INSTEAD OF PAYMENT FOR OVERTIME

Name of employee: _____________________________________________

Name of employer: _____________________________________________

The employer and employee agree that the employee may take time off instead of being paid for the following amount of overtime that has been worked by the employee:

Date and time overtime started: ___/___/20___ ____ am/pm

Date and time overtime ended: ___/___/20___ ____ am/pm

Amount of overtime worked: _______ hours and ______ minutes

The employer and employee further agree that, if requested by the employee at any time, the employer must pay the employee for overtime covered by this agreement but not taken as time off. Payment must be made at the overtime rate applying to the overtime when worked and must be made in the next pay period following the request.

Signature of employee: ________________________________________

Date signed: ___/___/20___

Name of employer
representative: ________________________________________

Signature of employer
representative: ________________________________________

Date signed: ___/___/20___

 1   [2016] FWCFB 2602

 2   These 26 awards currently provide for overtime but not for time off instead of payment for overtime.

 3   Ai Group submission 23 May 2016 at paragraphs 8-10

 4   NFF submissions 23 May 2016 at paragraph 22

 5   Ibid

 6   [2015] FWCFB 4658 at paragraph [7]

 7   [2015] FWCFB 4466 at paragraphs [95]-[111]

 8   Ibid and paragraph [277] i

 9   [2015] FWCFB 4466 at paragraph [186]

 10   [2016] FWCFB 2602 at paragraphs [15]-[17]

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