[2016] FWCFB 8463
FAIR WORK COMMISSION

DECISION


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

4 yearly review of modern awards—Payment of wages
(AM2016/8)

JUSTICE ROSS, PRESIDENT
DEPUTY PRESIDENT BOOTH
DEPUTY PRESIDENT CLANCY
COMMISSIONER CRIBB
COMMISSIONER HUNT

MELBOURNE, 1 DECEMBER 2016

4 yearly review of modern awards - Payment of wages.

1. Background

[1] Section 156 of the Fair Work Act 2009 (Cth) (FW Act) provides that the Commission must conduct a 4 yearly review of modern awards as soon as practicable after 1 January 2014 (the Review). Subsection 156(2) deals with what must be done in the Review and provides that the Commission must review all modern awards and may, among other things, make determinations varying modern awards. Each modern award must be reviewed in its own right, but this does not prevent the Commission from reviewing two or more modern awards at the same time (s.156(5)).

[2] In conducting the Review the Commission is able to exercise its usual procedural powers, contained in Division 3 of Part 5-1 of the FW Act. Importantly, the Commission is not bound by the rules of evidence and procedure (s.591) and may inform itself in relation to any matter before it in such manner as it considers appropriate (s.590(1)).

[3] The Review is to be distinguished from inter partes proceedings. Section 156 imposes an obligation on the Commission to review all modern awards and, as we have mentioned, each modern award must be reviewed in its own right. The Review is conducted on the Commission’s own motion and is not dependent upon an application by an interested party. Nor is the Commission constrained by the terms of a particular application. 1 The Commission is not required to make a decision in the terms applied for2 and, in a Review, may vary a modern award in whatever terms it considers appropriate, subject to its obligation to accord interested parties procedural fairness and the application of relevant statutory provisions, such as ss.134, 138 and 578.

[4] The scope of the Review was considered in the 4 Yearly Review of Modern Awards: Preliminary Jurisdictional Issues Decision. 3 We adopt and apply that decision and in particular the following propositions:

[5] A number of matters concerning various ‘payment of wages’ terms in modern awards have been referred to this Full Bench for determination. A summary of the various matters is set out in a Statement 4 issued on 6 July 2016. Conciliation conferences were held on 27 July 2016. A further Statement5 was issued on 2 August 2016. That Statement provided interested parties with an opportunity to comment on the proposed directions. Final directions were attached to a Statement6 issued on 15 August 2016. A list of the submissions made pursuant to those directions is set out at Attachment A.

[6] A Statement 7 was issued on 8 September 2016 attaching draft determinations for 25 modern awards in respect of which there was no specific claim. The awards in question provide a timeframe for the payment of termination payments and the draft determinations propose the variation of those provisions, in a manner consistent with the employer claims in relation to 10 other awards.

[7] In a Statement 8 issued on 14 October 2016 we expressed some provisional views about the payment of wages on termination.

2. The Issues

[8] The Shop, Distributive and Allied Employees Association (SDA) application 9 seeks to vary three modern awards to require that all wages be paid on a regular pay day within four days of the end of the pay period. The three awards are:

[9] These awards do not currently specify a pay day or a period after the completion of the pay-cycle within which an employee will receive their pay.

[10] The SDA, Australian Business Industrial and the NSW Business Chamber (jointly ABI) and Ai Group have reached an agreed position in respect of the variation of the three awards which are the subject of the SDA application.

[11] In relation to the General Retail Industry Award 2010, it is proposed that clause 23 be varied to insert the words ‘within 7 days of the end of the pay period’ at the end of the first sentence in the second paragraph, as follows:

[12] The payment of wages clauses in the Fast Food Industry Award 2010 and the Hair and Beauty Industry Award 2010 are in the same terms (see clauses 22 and 25 respectively):

[13] It is proposed to add the following words to the payment of wages clauses in these two awards:

[14] The SDA, ABI and Ai Group jointly submit that the proposed variations are necessary to ensure that these awards achieve the modern awards objective.

[15] The SDA’s application in respect of these three modern awards raises some broader issues, including the fact that most modern awards do not provide that wages should be paid within a specified period after the end of the pay period. The 11 modern awards listed below include a term providing that payment must be made within a specified number of days:

[16] In addition to the 11 awards listed above, 17 modern awards provide for payment on or before a particular day of the week. For example clause 21 of the Textile Clothing, Footwear and Associated Industries Award 2010 provides:

[17] The awards in this category are as follows:

[18] Three other modern awards allow for the payment of wages monthly or on a 4-week cycle and provide for such wages to be paid half in advance and half in arrears. 10

[19] For example, clause 23.1 of the Clerks – Private Sector Award 2010 provides:

[20] A further four modern awards 11 make some provision for payment in arrears. For example, clause 20.1(b) of the Air Pilots Award 2010 provides:

[21] The effect of the provisions in the above seven awards is to specify the frequency of payment and that payment is made ‘in arrears’, that is, after the work requiring payment has been performed. These awards do not specify a period after the end of the pay period within which wages are to be paid.

[22] A further 115 modern awards provide for the frequency by which the employers must pay employees, as follows:

Weekly

Fortnightly

Weekly or fortnightly

Weekly, fortnightly or monthly

Other

Award

Pay period

Air Pilots Award 2010

Weekly, fortnightly, monthly or otherwise as agreed

Aircraft Cabin Crew Award 2010

14 or 28 days or calendar month, in arrears or over such other period as agreed

Airline Operations—Ground Staff Award 2010

Weekly or fortnightly in arrears or otherwise as agreed

Aluminium Industry Award 2010

Weekly, fortnightly, 3 weekly, 4 weekly, monthly

Animal Care and Veterinary Services Award 2010

Associates must be paid at least monthly, on a set day and preferably at a set time. All other employees must be paid weekly, fortnightly or monthly

Black Coal Mining Industry Award 2010

Weekly unless otherwise agreed

Business Equipment Award 2010

Weekly, fortnightly, four-weekly, half-monthly, monthly or in accordance with existing practices

Building and Construction General On-site Award 2010

Weekly or less frequently in accordance with an award, a transitional award or a Division 2B state award

Coal Export Terminals Award 2010

Not longer than fortnightly

Contract Call Centres Award 2010

Weekly or fortnightly or 4 weekly or monthly as agreed between the employer and the majority of employees and “Notwithstanding anything in this clause, if there is an existing practice in place as at 31 December 2009 then an employer is permitted to continue with this practice

Educational Services (Schools) General Staff Award 2010

fortnightly, 4 weekly, monthly

Educational Services (Teachers) Award 2010

fortnightly, 4 weekly, monthly

Food, Beverage and Tobacco Manufacturing Award 2010

Weekly, fortnightly, 3 weekly, 4 weekly or monthly

Graphic Arts, Printing and Publishing Award 2010

Weekly, fortnightly, 4 weekly or monthly

Higher Education Industry—Academic Staff—Award 2010

fortnightly for academic staff, within 22 days of submitting a valid claim for casuals

Hydrocarbons Industry (Upstream) Award 2010

Not longer than monthly)

Labour Market Assistance Industry Award 2010

Weekly, fortnightly, 4 weekly or monthly

Legal Services Award 2010

Fortnightly unless otherwise agreed

Local Government Industry Award 2010

Weekly, fortnightly or as otherwise agreed

Manufacturing and Associated Industries and Occupations Award 2010

Weekly, fortnightly, 3 weekly, 4 weekly or monthly

Maritime Offshore Oil and Gas Award 2010

Not longer than monthly

Market and Social Research Award 2010

1, 2 or 4 weeks or a month

Meat Industry Award 2010

On a regular weekly basis or in a manner agreed

Mining Industry Award 2010

Not longer than monthly

Miscellaneous Award 2010

Dealt with in s.323

Nurses Award 2010

Fortnightly unless otherwise agreed, up to a maximum of monthly

Port Authorities Award 2010

Weekly, fortnightly or as otherwise agreed

Professional Diving Industry (Industrial) Award 2010

Weekly, fortnightly or as otherwise agreed

Professional Diving Industry (Recreational) Award 2010

Weekly, fortnightly or as otherwise agreed

Salt Industry Award 2010

Not longer than monthly

Seafood Processing Award 2010

Weekly, fortnightly, three weekly, four weekly or monthly

Seagoing Industry Award 2010

Not longer than monthly

Sporting Organisations Award 2010

Weekly or fortnightly, unless otherwise mutually agreed, up to a monthly maximum period

Telecommunications Services Award 2010

Weekly, fortnightly, four weekly or monthly or in accordance with a practice in place as at 31 December 2009

Timber Industry Award 2010

Weekly, fortnightly, three weekly, four weekly or monthly

Water Industry Award 2010

Weekly, fortnightly or as otherwise agreed

Wine Industry Award 2010

Weekly, fortnightly or alternative intervals by agreement in writing.

[23] Just seven modern awards, as listed below, do not make any provision for frequency of payment. Of these awards, only the Racing Clubs Events Award 2010 makes any provision for payment of wages and this provision is limited to specifying methods of payment.

Consideration

[24] Before further discussing modern award ‘payment of wages’ provisions, it is instructive to consider the extent of the statutory regulation. Section 323 of the FW Act deals with both the frequency of payments to an employee for ‘amounts payable to the employee in relation to the performance of work’ and the method for payment:

[25] In Casey Grammar School v Independent Education Union of Australia 13 (Casey Grammar School) the Commission observed that:

[26] Section 323 deals with the method by which (e.g. cash, cheque or EFT) and frequency with which (at least monthly) employers must pay employees amounts payable to them in relation to the performance of work. The effect of s.323(1)(c) appears to be that such amounts must be paid no later than one month after accrual.

[27] As noted in Casey Grammar School, s.323 operates on an existing obligation to pay by imposing further obligations on the employer in relation to the time, frequency and method of such payments. Section 323 does not specify when an amount ‘payable … in relation to the performance of work’ becomes payable, or in other words, accrues.

[28] Section 323 only applies to ‘amounts payable to the employee in relation to the performance of work’. The precise scope of this expression is unclear. While it is apt to cover wages (including commission payments 15) and wage related amounts such as leave payments16, it is not clear whether it encompasses all termination payments. Regulation of the timing of termination payments is discussed further in section 2.3 of this decision.

[29] In addition to the variations in the modern award ‘payment of wages’ provisions referred to above, there are some further aspects of these provisions more generally that require comment. First, the award provisions do not expressly deal with accrual of payments.

[30] Second, while most of the modern award provisions are headed ‘payment of wages’, they adopt a range of different descriptions of the types of payments that they regulate. These descriptions include:

[31] Third, as appears from the proposed variations to the General Retail Industry Award 2010, Fast Food Industry Award 2010 and the Hair and Beauty Industry Award 2010 set out at paragraphs [11] to [13] above, while most modern awards prescribe frequency of payments (weekly, fortnightly etc), this is not understood to regulate the extent to which payments may be made in arrears. It would seem that under these proposed variations, the maximum permissible period between work being performed by an employee and wages being paid to the employee for that work would be 14 days where wages are paid weekly and 21 days where wages are paid fortnightly.

[32] It is not readily apparent that the differences between the various modern award payment of wages provisions in terms of frequency of payment, pay days, payment in arrears, the types of payments they are expressed to regulate and other differences in the wording of provisions, in fact reflect different characteristics of the enterprises covered by the various awards.

[33] It is our provisional view that all modern awards should include a term providing for the method and frequency of payment as well as placing a limit on payment in arrears. We also consider that there is utility in establishing a model ‘payment of wages and other amounts’ award term.

[34] Our provisional ‘payment of wages and other amounts’ model term is as follows:

X. Payment of wages and other amounts

x.1 Pay periods and pay days

(a) The employer must pay each employee no later than 7 days after the end of each pay period:

(b) An employee’s pay period may be:

(c) The employer must notify each employee in writing of their pay day and pay period.

(d) Subject to paragraph (e), the employer may change an employee’s pay day or pay period after giving 4 weeks’ notice in writing to the employee.

(e) An employer may only change from a one week or two week pay period to a one month pay period by agreement with affected employees. If employees in a particular classification were paid monthly prior to [insert date of commencement of this clause], the employer may continue to pay employees in that classification monthly without further agreement.

(f) Where an employee’s pay period is one month, two weeks must be paid in advance and two weeks in arrears.

x.2 Method of payment

[35] Aspects of the provisional model term warranting further discussion include: the types of payments it covers; accrual of payments under the award and the NES; how the term provides for frequency of payment; restrictions on monthly pay; variation of pay days and pay periods; whether provision needs to be made for pay days falling on weekends or public holidays, and method of payment. These issues are discussed below.

[36] As noted at paragraph [30] above, while some of the existing award payment provisions are confined to ‘wages’, many are expressed to include other amounts. The FW Act does not define the term ‘wages’. The term ‘earnings’ is defined in s.332. Wages form part of ‘earnings’ (s.332(1)(a)), but ‘payments the amount of which cannot be determined in advance’ (s.332(2)(a)) do not. The note to s.332(2)(a) gives as examples of payments excluded from ‘earnings’: ‘commissions, incentive-based payments and bonuses, and overtime (unless the overtime is guaranteed)’. It consequently appears that ‘wages’ as used in the FW Act is narrower than ‘remuneration’ 17 and is narrower than ‘amounts payable … in relation to the performance of work’ in s.323(1).

[37] Modern awards commonly specify ‘minimum wages’ exclusively of other payment entitlements such as allowances, penalties and overtime payments. However, it has not been suggested that an award ‘payment of wages’ provision referring only ‘wages’ should be understood as applying only to payments of base wages. Paragraph x.1(a) of the provisional model term requires the payment made to an employee for each pay period to include wages and ‘all other amounts that are due to the employee under this award and the NES for the pay period’. Such payment will include, for example, any base wages in respect of the pay period and any allowances, penalties, overtime and paid leave payments that have accrued under the award and the NES during the pay period.

[38] The wording of subparagraph x.1(a)(i) of the provisional model term is intended to ensure that wage payments accrue under the award, or in other words fall due, by the end of each pay period. As discussed later in this decision, absent a provision to this effect there might be doubt as to when wages accrue under an award. In contrast, subparagraph x.1(a)(ii) of the provisional model term requires payment of all other amounts that ‘are due’ under the award and the NES for the pay period. This wording assumes that all amounts other than wages provided for in the award or the NES and that should be paid to an employee in respect of a pay period, accrue under the terms of the award or the NES in the pay period. Accrual of payments under modern awards and the NES is discussed in section 2.4 of this decision.

[39] It is apparent from the proposed variations to the General Retail Industry Award 2010, Fast Food Industry Award 2010 and the Hair and Beauty Industry Award 2010 discussed earlier, that frequency of payment involves two issues. The first issue is the period in respect of which an employee’s pay is to be calculated, or the ‘pay period’. The second issue is when payment in respect of a pay period is to be made to the employee, or the ‘pay day’. The use of ‘pay period’ in the provisional model term is consistent with its use in the FW Act, for example in s.49(6):

[40] Paragraph x.1(b) of the provisional model term permits the length of an employee’s pay period to be one week, two weeks or, subject to paragraph (e), one month. The effect of paragraph (e) is that where employees in a particular classification are already paid on a one month pay period then this can continue, but a new monthly pay arrangement can only be introduced by agreement with affected employees.

[41] Pursuant to paragraph x.1(f) of the provisional model term, where the length of an employee’s pay period is one month, two weeks of the pay period must be paid in advance. This is to be understood as requiring payment of two weeks in advance as on the employee’s pay day. The intention is to limit payment in arrears to ensure compliance with s.323(1)(c). We note that paragraph x.1(f) of the provisional model term is consistent with clause 23.1 of the Clerks – Private Sector Award 2010.

[42] Under the General Retail Industry Award 2010 and the Fast Food Industry Award 2010 and the Hair and Beauty Industry Award 2010 as proposed to be varied, an employer may change a regular pay day after four weeks’ notice. Under the General Retail Industry Award 2010, but not the variations proposed to the other two awards, such notice must be given in writing. It may have been intended that variation of a pay day under these award terms encompass variation of the length of pay periods. Paragraph x.1(d) of the provisional model term makes it clear that an employer can change both an employee’s regular pay day and the employee’s pay period after giving four weeks’ written notice to the employee.

[43] Under the variations proposed to the Fast Food Industry Award 2010 and the Hair and Beauty Industry Award 2010 but not under the General Retail Industry Award 2010, ‘[i]f the regular pay day falls on a public holiday the wages may instead be paid on the next day that is not a Saturday, Sunday or public holiday’. Similar provision is made in a number of other awards. 19

[44] Section 36(2) of the Acts Interpretation Act 1901 (Cth) (AI Act) provides that where an Act requires a thing to be done on a Saturday, Sunday or public holiday, the thing may be done on the next day that is not a Saturday, Sunday or public holiday. Pursuant to s.46(1)(a) of the AI Act, s.36(2) applies to a modern award as if it were an Act. Interested parties are asked to consider whether it would be desirable for the model term to include provision to same effect as AI Act s.36(2), or alternatively, to include a note drawing attention to the statutory provision.

[45] Subsection x.2 of the provisional model term provides clarity in relation to permissible methods of payment, by requiring payments to be made by EFT, cash or cheque. As reproduced earlier, FW Act s.323(2) specifies methods by which payments may be made to employees ‘in relation to the performance of work’, subject to express award provision (s.323(3)). Twelve modern awards do not currently specify any method of payment. These 12 awards include the General Retail Industry Award 2010, Fast Food Industry Award 2010 and Hair and Beauty Industry Award 2010.

[46] As discussed above, it is not apparent that the significant variations in existing modern award ‘payment of wages’ terms are justified. The modern awards objective includes ‘the need to ensure a simple, easy to understand, stable and sustainable modern award system’. Providing clarity to employees about when and for what period they will be paid and providing clarity to employers as to their obligations to make such payments, is consistent with this objective.

[47] Our provisional view is that there would be benefit in either replacing the existing provision for payment in all modern awards with the model term (once finalised), or alternatively with a version of the model term appropriately adapted to the existing award payment arrangements. Following are two examples of how the provisional model term might possibly be adapted to existing arrangements.

Existing award term

Possible adaption of provisional model term

General Retail Industry Award 2010

23. Payment of wages

    Wages will be paid weekly or fortnightly according to the actual hours worked each week or fortnight, or may be averaged over a period of a fortnight.
    All wages shall be paid on a regular pay day. The employer must notify the employee in writing as to which day is the pay day. Where for any reason the employer wishes to change the pay day, then the employer shall provide at least 4 weeks’ written notice to the employee of such change.
    An enterprise which prior to the 1st January 2010, paid particular classifications of its employees on a monthly pay cycle may continue to pay these particular classifications of employees on a monthly pay cycle. However no employee classified at level 3 or below under this Award may be paid on a monthly pay cycle and must be paid either weekly or fortnightly.

23. Payment of wages and other amounts

23.1 Pay periods and pay days

    (a) The employer must pay each employee no later than 7 days after the end of each pay period:

      (i) the employee’s wages for the pay period; and

      (ii) all other amounts that are due to the employee under this award and the NES for the pay period.

    (b) Payments may be calculated according to the hours worked by the employee each week, or the average hours worked over two weeks.

    (c) An employee’s pay period may be:

      (i) one week; or

      (ii) two weeks; or

      (iii) subject to paragraph (f), one month.

    (d) The employer must notify each employee in writing of their pay day and pay period.

    (e) Subject to paragraph (f), the employer may change an employee’s pay day or pay period after giving 4 weeks’ notice in writing to the employee.

    (f) An employer may not change from a one week or two week pay period to a one month pay period. If employees in a particular classification at Level 4 or above were paid monthly prior to 1 January 2010, the employer may continue to pay employees in that classification monthly. No employee classified at Level 3 or below may be paid monthly.

    (g) Where an employee’s pay period is one month, two weeks must be paid in advance and two weeks in arrears.

23.2 Method of payment

    Payments under clause 23.1(a) must be made by electronic funds transfer to the account at a bank or financial institution nominated by the employee, or by cash or cheque.

Pharmaceutical Industry Award 2010

21. Payment of wages

21.1 Wages must be paid by cash, cheque or EFT weekly (or fortnightly by agreement with the majority of affected employees or an individual employee), not later than Thursday in each pay week, unless otherwise agreed with the majority of employees. Provided that in any pay week in which a public holiday falls on a Thursday or Friday, wages accrued must be paid on the previous Wednesday.

21.2 An employee paid by cash or cheque, must be paid in the employer's time and if kept waiting for their wages on pay day for more than 15 minutes after the usual time for ceasing work must be paid at overtime rates after that 15 minutes until payment has been received.

21. Payment of wages and other amounts

21.1 Pay periods and pay days

    (a) The employer must pay each employee no later than 7 days after the end of each pay period:

      (i) the employee’s wages for the pay period; and

      (ii) all other amounts that are due to the employee under this award and the NES for the pay period.

    (b) The pay day must be no later than Thursday in each pay week unless otherwise agreed with the majority of employees. If Thursday or Friday in any pay week is a public holiday, accrued wages must be paid on the preceding Wednesday.

    (c) An employee’s pay period may be:

      (i) one week; or

      (ii) subject to paragraph (f), two weeks.

    (d) The employer must notify each employee in writing of their pay day and pay period.

    (e) Subject to paragraph (f), the employer may change an employee’s pay day or pay period after giving 4 weeks’ notice in writing to the employees.

    (f) An employer may only change from a one week pay period to a two week pay period by agreement with a majority of affected employees or with an employee individually.

21.2 Method of payment and late payment

    (a) Payments under clause 21.1(a) must be made by electronic funds transfer to the account at a bank or financial institution nominated by the employee, or by cash or cheque.

    (b) An employee paid by cash or cheque must be paid during working time and if kept waiting for payment for more than 15 minutes after their usual time for finishing work, must be paid at overtime rates after that 15 minutes until payment is received.

[48] Parties are requested to make written submissions in relation to the provisional ‘payment of wages and other amounts’ model term, including its treatment of accrual of payments as discussed further in section 2.4 of this decision. Submissions should be directed to the concepts in and wording of the provisional model term.

[49] Submissions are also sought in respect of the provisional view that there would be benefit in either replacing the existing provision for payment in all modern awards with the model term (once finalised), or alternatively with a version of the model term appropriately adapted to the existing award payment arrangements.

[50] Parties will be given the opportunity to raise award specific issues if and when draft determinations are issued.

2.2 Removing a restriction on the days for payment of wages

[51] Restaurants and Catering Industrial (RCI) is seeking to vary the Restaurant Industry Award 2010 to delete the current prohibition on the payment of wages on Fridays, Saturdays and Sundays. The claim is opposed by United Voice. The RCI proposed that its claim be dealt with in the Award Stage of the Review, rather than as part of these proceedings, on the basis that ‘this particular claim [is] interrelated to the other claims [RCI] will be seeking at the Award Stage … [and] is specific to a single award’. 20 United Voice did not oppose that course.

[52] In the 2 August 2016 Statement we agreed with the course proposed and accordingly this claim will be referred to the Award Stage of the Review.

2.3 Timing of payment on termination of employment

[53] Some 36 modern awards contain terms which provide for the payment of wages and other amounts owing to an employee on the termination of their employment. The relevant terms of these modern awards are set out in Attachment B.

[54] Six of the 36 modern awards require payment on the day of termination, these are the:

[55] One award - the Aluminium Industry Award 2010 - contains an option of payment on termination or in accordance with the employee’s normal pay cycle.

[56] Twenty-five of the 36 modern awards specify a period after termination within which the termination payments must be made:

Award Days after termination within
 which payment must be made
Asphalt Industry Award 2010 2
Black Coal Mining Industry Award 2010 3
Building and Construction General On-site Award 2010 2
Business Equipment Award 2010 1
Children’s Services Award 2010 1
Electrical, Electronic and Communications Contracting Award 2010 1
Food, Beverage and Tobacco Manufacturing Award 2010 1
Graphic Arts, Printing and Publishing Award 2010 1
Horse and Greyhound Training Award 2010 1
Horticulture Award 2010 1
Manufacturing and Associated Industries and Occupations Award 2010 1
Market and Social Research Award 2010 1
Meat Industry Award 2010 1
Mobile Crane Hiring Award 2010 1
Nursery Award 2010 2
Passenger Vehicle Transportation Award 2010  
Pastoral Award 2010 1
Pharmaceutical Industry Award 2010 2
Plumbing and Fire Sprinklers Award 2010 2
Professional Diving Industry (Industrial) Award 2010 1
Professional Diving Industry (Recreational) Award 2010 1
Seafood Processing Award 2010 2
Silviculture Award 2010 2
Storage Services and Wholesale Award 2010 2
Wine Industry Award 2010 1

 

[57] The remaining four of the 36 modern awards express timeframes in different ways:

[58] As is evident from the table above, the time period within which termination payments are to be made varies from the day of termination to three days after termination. In addition to these variations, there are other features of some of these 36 modern awards which warrant further examination:

[59] It is apparent that there is considerable variation in the manner in which these
36 modern awards deal with payments on termination. In addition to the matters already mentioned, the terms in these awards refer to the amounts owing to an employee in various ways, including ‘all money due’ 21, ‘monies’22, ‘all wages and other monies’23 and ‘all wages and holiday pay’24.

[60] Further, some of the existing terms do not cover all of the circumstances resulting in termination of employment. For example, clause 31.4 of the Building and Construction General On-Site Award 2010 provides:

[61] Clause 31.4 does not make provision for termination without notice, abandonment or payment in lieu of notice.

[62] In addition to the lack of uniformity in the existing terms dealing with termination payments, some 86 modern awards make no provision at all for the time period within which termination payments are to be made.

[63] Ai Group and ABI are, together, seeking to vary 10 of the 36 modern awards which deal with termination payments to enable employers who pay by electronic funds transfer (EFT) to make termination payments in accordance with the normal pay cycle. The modern awards sought to be varied are:

[64] Ai Group submits that current award provisions:

[65] Ai Group’s proposed draft determinations would add the following sentence to existing payment of wages clauses: ‘provided that, where such wages are paid by EFT, payment may be made in accordance with the usual pay cycle’.

[66] It is submitted that this change will reduce costs and regulatory burden presently borne by the employer because of the requirement to pay a potentially large sum within a short period and the need to administer an additional pay run. It is further submitted that the proposed variations:

[67] ABI submits that the current award provisions in the awards which are subject to the claim are impractical and inconsistent with the modern awards objective 26 and advances five reasons for the proposed change:

[68] The CFMEU (Mining and Energy Division) advances an alternate variation in respect of the Black Coal Mining Industry Award 2010. The current clause 16.7 of that award provides that upon termination of employment, wages due to an employee will be paid on the day of termination or forwarded by post within 72 hours, to the last address notified by the employee. The CFMEU proposed variation adds the following words to the existing term:

Consideration

[69] The issues associated with the payment of wages and other sums owing on termination of employment are broader than the claims advanced by Ai Group and ABI. As we have noted, there is considerable variation in the award terms dealing with this issue, for no apparent reason. Further, some 86 modern awards make no provision for payments on termination, in circumstances where there is some doubt as to whether the legislative scheme makes provision for all of the types of payments which may be due to an employee on termination of employment. We deal with the relevant legislative provisions shortly.

[70] These considerations led us to express some provisional views in respect of this issue, in a Statement 28 published on 14 October 2016. The provisional views may be summarised as follows:

[71] Before turning to consider the submissions made in respect of these provisional views, we propose to say something about the relevant statutory provisions.

[72] As discussed above, s.323 of the FW Act deals with both the frequency of payments to an employee for ‘amounts payable to the employee in relation to the performance of work’ and the method for payment.

[73] As also noted above, s.323 only applies to ‘amounts payable to the employee in relation to the performance of work’, and the precise scope of this expression is unclear. Relevantly for present purposes, it is not clear whether it encompasses all amounts accrued under an award or the NES upon termination, such as redundancy pay (s.119(1)). 29 There does not appear to be anything else in the FW Act that addresses the timing of termination payments generally. Consequently, if s.323 does not encompass all termination payments, there would seem to be a legislative gap – that is, no time frame is specified within which certain termination payments are to be made.

[74] One provision of the FW Act that does deal expressly with the timing of a termination payment is s.117:

[75] Subsections 123(1) – (3) provide that Division 11 and Subdivision A of Division 11 of Part 2-2 (which include s.117) do not apply to certain categories of employees, as follows:

[76] No regulations have been made pursuant to s.123(3)(e).

[77] The proper construction of s.117(2) was considered by White J in Melbourne Stadiums Limited v Sautner:

[78] On a literal reading s.117(2) prohibits an employer terminating the employment of an employee without giving the prescribed ‘minimum period of notice’ (s.117(2)(a)), or making payment in lieu of notice before or at the time of termination of employment (s.117(2)(b)). The remedy lies in an application for a penalty for contravention of the provision. 31 How s.117(2)(b) sits with some of the existing award provisions in relation to payment on termination is unclear.

[79] It is also relevant to note that s.117 does not cover all of the means by which employment may be terminated. An employee’s employment may be terminated: by mutual agreement; at the initiation of the employer (e.g. depending on the terms of the employment contract, by giving the required notice, making a payment in lieu of notice or by summarily dismissing the employee), or it may be initiated by the employee resigning. An employment contract may also be terminated by operation of law, independently of the parties – for example, by frustration. 32 The central point is that not all instances of termination of employment are within the control of the employer. Indeed, the available data suggests that only about a third of all terminations are initiated by the employer. Most of the other
two-thirds of terminations appear to be initiated by employees resigning from their employment.33

[80] The means by which a contract of employment is terminated determines the time at which the employment ends. A valid notice of termination operates according to its terms and brings the contract to an end when the notice expires. 34 Where a contract permits termination by payment in lieu of notice the contract will end upon such payment being made.35

[81] We now turn to the submissions in respect of the provisional views expressed in our Statement of 14 October 2016.

[82] The various employer bodies that made submissions generally supported the default term and the proposition that it should be inserted in all 122 modern awards. Ai Group and ABI abandoned the award variations they had initially proposed in favour of inserting the default term in the awards subject to their applications, in lieu of the existing termination payment terms. Some limited modifications to the default term were proposed by some employer parties to accommodate the particular circumstances in certain modern awards – such as the incidence of daily hire in some construction awards and the payment of commissions in some awards. In the event we decided to proceed with a model term, various parties sought an opportunity to comment on the appropriateness of inserting such a model term into particular modern awards.

[83] The unions which made submissions generally opposed the Ai Group/ABI claims, the default term and the proposition that it be inserted into all modern awards. Four broad lines of argument are advanced in support of this position:

[84] It is uncontested that there seems to be a legislative gap with respect to the time period within which termination payments are to be made. Section 323 does not appear to cover all termination payments and no other provision of the FW Act deals with the timing of termination payments generally.

[85] The obligations and entitlements of employers and employees in respect of termination payments (and the time within which they are to be paid) should be expressed in clear and simple terms. The modern award system should be simple and easy to understand.

[86] We confirm our provisional view that each modern award should provide for the payment of wages and other amounts owing to an employee on termination of employment. Such a term should also prescribe the timeframe within which such termination payments are to be made.

[87] We also confirm our provisional view that there is utility in common ‘payment on termination’ provision across all 122 modern awards. But we accept that each modern award is to be reviewed in its own right and there may be sound reasons for departing from a model term in a particular modern award. A case by case assessment is required.

[88] We turn next to the content of the provisional default term. The modern awards objective is to ‘ensure that modern awards, together with the NES, provide a fair and relevant minimum safety net of terms and conditions’. Fairness in this context is to be assessed from the perspective of employees and employers covered by the modern award in question. A ‘fair’ model term in respect of termination payments appropriately balances the issues raised on behalf of employees and those raised on behalf of employers.

[89] The arguments advanced by ABI and Ai Group in support of the variation of current termination payment terms can be divided into two broad categories:

[90] The impracticability arguments point to the inherent difficulty in providing termination payments at, or shortly after, the time of termination. We accept that this would be so in some instances, particularly in cases of summary dismissal and where an employee resigns their employment without giving notice. In such cases it may plainly take some time to calculate accrued leave payments. In cases of redundancy the applicable taxation arrangements may depend upon the particular circumstances and employers (particularly small businesses) may have to obtain advice externally before processing termination payments. We also accept that on the available data, the majority of terminations are not initiated by the employer so that the timing of the termination of employment is not within the employer’s control.

[91] The administrative cost argument points to the cost associated with making termination payments outside the ordinary pay cycle at the workplace. There may be a time cost associated with obtaining immediate information about the time worked in the pay period in which termination occurred. Some employers may also be charged an additional cost for ‘out of cycle’ EFT transactions. We accept that some employers are likely to face such costs, but the costs are not likely to be substantial. As ABI puts it in its submission, in relation to ‘out of cycle’ EFT transactions:

[92] If termination payments are made, part of an employee’s termination payment is likely to be in respect of work that the employee has already performed and leave that has already accrued. It is appropriate that such payments be made in a timely way. We accept that if termination payments are made in accordance with the employee’s usual pay cycle – as permitted in the provisional default term – an employee may have to wait up to a month to receive their payment. A period of up to a month is too long. It does not satisfy the requirement for a fair and relevant minimum safety net.

[93] But we also accept that there is considerable force in the ‘impracticability’ argument advanced by ABI and Ai Group. It is not fair to employers to require all termination payments to be made either at the time of termination or within a few days thereafter.

[94] It is also relevant that a delay in the payment of the amounts owing to an employee upon the termination of their employment may delay their access to social security payments.

[95] As pointed out by the AMWU, under the provisional default term it is conceivable that some employees may have to wait for up to a month before they receive their termination entitlements. Such a delay may impact on the capacity for employees whose employment has been terminated to access Newstart or other social security benefits.

[96] According to information received from the Department of Social Services 37, an applicant for Newstart may be subject to a number of waiting periods including a Liquid Assets Waiting Period (LAWP) or an Income Maintenance Period (IMP). The LAWP may require an applicant to wait for up to 13 weeks before they can access Newstart, depending upon the amount of funds that are readily available to them. The definition of ‘liquid assets’ for the purpose of the LAWP includes money owed to the applicant by their former employer. The IMP involves an assessment of the termination payments received by an employee against the employee’s ‘ordinary income’. The number of weeks of ordinary income represented by the termination payment then forms the basis of the IMP. As a general rule, the IMP takes effect from the date the employer pays the termination payment.38

[97] The AMWU submits that under the default term:

[98] In reply, ABI submits that employees could make an estimate of their termination payments if they exercised their right to obtain information in relation to their annual leave accruals, rate of pay and hours worked, pursuant to Part 3-6 of the Fair Work Regulations 2009 in addition to relying on past payslips. The difficulty with this submission is that an employee’s right to obtain such information is subject to the provisions of Regulation 3.42(3) and (4):

[99] We think an appropriate balance between the various considerations is for the model term to provide that all unpaid wages and all other amounts due to an employee under the modern award and the NES are to be paid ‘no later than 7 days after the employee’s last day of employment’.

[100] Such a provision ensures that employees receive their termination payments in a timely way while providing employers with sufficient time to calculate and pay the sums due. Such a term would address the ‘impracticability’ arguments advanced on behalf of the employers. We accept that we may impose some ‘time costs’ associated with obtaining information about the hours worked in the prior pay period and may require ‘out of cycle’ EFT transactions in some instances, but the costs involved are unlikely to be substantial.

[101] Having regard to the terms of the NES, there two potential qualifications to a requirement to make payment ‘no later than 7 days after the employee’s last day of employment’ that need to be considered. The first relates to s.120 and the second to s.117(2)(b) of the FW Act.

[102] Section 120 of the FW Act provides that in some circumstances an employer can apply to the Commission for a determination that the amount of redundancy pay to which an employee is entitled under the NES is reduced to a specified amount (which may be nil). The relevant circumstances are that an employee is entitled to be paid an amount of redundancy pay by the employer because of s.119 and either the employer obtains ‘other acceptable employment’ for the employee or the employer is unable to pay that amount of redundancy pay.

[103] Absent a qualification to the proposed requirement to make payment ‘no later than 7 days after the employee’s last day of employment’, if an application is made under s.120 and the application is not determined by the Commission and any reduced amount of redundancy pay paid by the employer by the end of that time period, the employer will breach the award.

[104] The provisional default term will be qualified so that, where an employer has made an application under s.120, the Commission will be able to make an order delaying the requirement to pay redundancy pay to which the employee is entitled under FW Act s.119, until a specified day after the Commission has determined the application. It is envisaged that, consistent with the usual payment requirement under the default term, such orders would generally require payment of the amount (if any) to which the employee is entitled in accordance with the Commission’s decision on the application no later than seven days after the date of that decision.

[105] We are also satisfied that the provisional default term requires qualification to deal with the interaction with s.117(2)(b).

[106] As we have mentioned, on a literal reading s.117(2) prohibits an employer terminating the employment of an employee without (relevantly) making payment in lieu of notice before, or at the time of, termination of employment.

[107] Section 55 of the FW Act provides for the interaction of modern awards and the NES:

[108] The statutory notes 41 to s.55(4) provide examples.

[109] Section 55(1) provides, relevantly, that a modern award ‘must not exclude’ the NES or any provision of the NES. An exclusion for the purpose of s.55(1) is not confined to award provisions which purport to oust the operation of a provision of the NES (such as s.117(2)(b)) in express terms. If the operation of an award term would result in employees not receiving (in full or at all) a benefit provided by the NES, that constitutes a prohibited exclusion of the NES. 42

[110] If the literal meaning of s.117(2) is the correct construction then, absent a variation to the provisional default term, employers may be inadvertently misled into a contravention of s.117(2)(b).

[111] Ai Group and ABI support the inclusion of a note to ensure that employers are not inadvertently misled into a contravention of s.117(2)(b). ABI proposed a note in the following terms:

[112] ABI submits that such a note will serve as an important contextual guide which confirms that the provisional default term is not intended to operate in a manner inconsistent with s.117(2)(b) and will ensure no person is misled as to their payment obligations in respect of the termination of an employee’s employment.

[113] Ai Group expressed some reservations about the breadth of the note proposed by ABI. Others expressed reservations about the inclusion of a note, in whatever form.

[114] Of course, s.117(2)(b) only applies to payments in lieu of notice and hence it regulates a narrower range of entitlements than those covered by the default term. A model term would also cover, for example, payments for accrued leave, wages for time actually worked and redundancy pay.

[115] We think the provisional default term should be amended to make clear that it is subject to s.117(2)(b) and to include a note drawing attention to that statutory provision. The note will be phrased so as to avoid the need to form a concluded view about the proper construction of s.117(2)(b).

[116] We also think the provisional default term should be amended to make clear that employees are entitled to be paid wages in respect of any incomplete pay period worked up to the end of the employee’s employment. As discussed in section 2.4 of this decision, absent provision to this effect, there might be doubt as to whether an employee is entitled to be paid wages for an uncompleted pay period.

[117] The provisional ‘payment on termination of employment’ model term will now be:

[118] The wording of paragraph (i) of the provisional model term is intended to ensure that wages accrue under the award in respect of any incomplete pay period worked by the employee (for example, if the employee’s employment ends after the employee has worked only two days of a one week pay period). The wording of paragraph (ii) of the provisional model term assumes that all amounts other than wages that should be paid to an employee after termination of the employee’s employment, accrue under the terms of the award or the NES either during any complete or incomplete pay period worked by the employee before the termination or upon termination. Accrual of payments under modern awards and the NES is discussed in section 2.4 of this decision.

[119] We propose to take the following steps in relation to this issue. Written submissions by interested parties wishing to comment on the provisional model term, including its treatment of accrual of payments as discussed further in section 2.4 of this decision, are to be filed by 4 pm on Thursday 22 December 2016 and submissions in reply by 4 pm on Thursday 2 February 2017, with liberty to apply. All submissions are to be sent to [email protected] and will be published on the Commission’s website in the usual way. The matter will be listed for hearing on Wednesday 8 February 2017.

[120] A further process will occur in relation to the questions of which modern awards should be varied to insert the model term. As we have noted, we have concluded that each modern award should provide for the payment of wages and other amounts owing to an employee on termination of employment. Such a term should also prescribe the timeframe within which such termination payments are to be made.

[121] We have also confirmed our provisional view that there is utility in a common payment on termination provision across all 122 modern awards. But we accept that each modern award is to be reviewed in its own right and that there may be sound reasons for departing from the model term in a particular modern award. A case by case assessment will be required.

[122] Accordingly, once the model term has been settled we will issue a Statement setting out the process for considering which modern awards are to be varied to insert the model term. Interested parties will be given an opportunity to comment on whether particular modern awards should be varied to insert the model term.

[123] As discussed above, s.323 of the FW Act deals with the method and frequency with which employers must pay an employee ‘amounts payable to the employee in relation to the performance of work’, and appears to have the effect that such amounts must be paid no later than one month after accrual. Section 323 does not specify when ‘amounts payable to the employee in relation to the performance of work’ become payable, that is, when the entitlement to payment accrues.

[124] The FW Act does specify when various payments under the NES accrue. For example, the entitlement under the NES to payment in lieu of untaken paid annual leave and to redundancy pay is expressed to arise upon termination of employment (see ss.90(2) and 119(1)). As discussed at paragraphs [74] – [78] above, it seems that the FW Act requires payment in lieu of notice under the NES to be made before or at the time of termination of employment (s.117(2)) and the entitlement to redundancy pay under the NES would seem to arise when an employee’s employment is terminated in certain circumstances (s.119(1)). Entitlement under the NES to payment for paid annual leave or for paid personal/carer’s leave, is expressed to arise when an employee takes a period of such leave (ss.90(1) and 99) and similarly with compassionate leave (s.106), absence on jury service (s.111(2)) and absence on a public holiday (s.116).

[125] Notably, the FW Act does not appear to specify when wages accrue. In contrast, s.67 of the Fair Work Act 1994 (SA) provides:

[126] Academic commentary suggests that, absent express provision for accrual in an award, if wages are required to be paid periodically under the award (for example, weekly, fortnightly or monthly) then they will be taken to accrue with at least the same frequency. 43

[127] This would seem to accord with the terms of many award ‘payment of wages’ clauses. For example, the ‘minimum weekly wages’ clause (cl.17) of the General Retail Industry Award 2010 contains only a table of weekly wage rates for the award classifications and does not expressly provide for accrual of wages whether on a weekly, daily, hourly or other basis. However, the wording in the ‘payment of wages’ clause of that award (cl.23, as reproduced at paragraph [11] above) ‘[w]ages will be paid weekly or fortnightly’, might be read as entailing that wages must accrue at least weekly or fortnightly.

[128] In contrast to the ‘minimum weekly wages’ clause of the General Retail Industry Award 2010, express provision is made in the award for accrual, for example, of a meal allowance (see cl.18.1) and payment at overtime rates (see cl.20.1) during a pay period. It should be noted that some award terms may also provide for payment to be made in a subsequent pay period. For example, the ‘time off instead of payment for overtime’ model term includes the requirement that:

[129] The period over which wages accrue is of significance because the employee only earns wages for completing each such period. 44 Absent express provision for accrual, there may be a question as to whether an employee whose employment ends part way through a pay period is entitled to wages for the incomplete period. For example, if an employee is paid weekly and the employee’s employment ends after three and a half days of a weekly pay period, there may be a question as to whether the employee is entitled to any wages for those three and a half days. If the employee’s wages accrue for working a week, the employee will not be entitled to wages for the three and a half days (although the employee may have a basis to claim some other form of compensation45). If the employee’s wages accrue on a daily basis, the employee will be entitled to wages for the three complete days that were worked in the pay period, but not for the half day. If the employee’s wages accrue on an hourly basis, the employee will also be entitled to wages for complete hours worked on the half day. 46

[130] It has been suggested that an employee’s wages under an award will be taken to accrue hourly if the award specifies an hourly wage rate for the employee (perhaps in addition to a daily, weekly, annual or other rate) or the award specifies that wages are to be calculated on the basis of hours worked, 47 but not all awards make such provision.

[131] These considerations point to another potential regulatory gap in relation to payment of wages and other amounts under awards.

[132] The obligations and entitlements of employers and employees in respect of wages and other amounts payable under modern awards (and when they become payable) should be expressed in clear and simple terms. The modern award system should be simple and easy to understand.

[133] As discussed earlier, the wording of subparagraph x.1(a)(i) of the provisional ‘payment of wages and other amounts’ model term at paragraph [34], is intended to ensure that wage payments accrue under the award by the end of each pay period. Whether provision to this effect is necessary (or whether it would suffice simply to require payment of ‘wages due for the pay period’), may depend upon the wording of the minimum wage provisions of the particular award concerned. Subparagraph x.1(a)(ii) of the provisional model term assumes that all amounts other than wages provided for in the award or the NES that should be paid to an employee in respect of a pay period, accrue under the terms of the award or the NES in the pay period. Whether this is the case, may also depend upon the wording of the clauses prescribing allowances, overtime, penalty rates and so forth in the particular award concerned.

[134] As also discussed earlier, the wording of paragraph (i) of the provisional model ‘payment on termination of employment’ model term at paragraph [117], is intended to ensure that wages accrue under the award in respect of any incomplete pay period worked by the employee prior to the employee’s employment ending. Again, whether provision to this effect is necessary, may depend upon the wording of the minimum wage provisions of the particular award concerned. This wording does not seek to clarify whether an employee is to be paid wages for a part of a day or a part of an hour worked in an incomplete pay period.

[135] Similarly to the provisional ‘payment of wages and other amounts’ model term, the wording of paragraph (ii) of the provisional ‘payment on termination of employment’ model term assumes that all amounts other than wages that should be paid to an employee after termination of the employee’s employment, accrue under the terms of the award or the NES either during any complete or incomplete pay period worked by the employee before the termination or upon termination.

[136] The issue of when payments accrue under modern awards might arise in the context of the Fair Work Ombudsman (FWO) assisting employees or former employees to recover unpaid wages and other amounts. The Full Bench would appreciate receiving information from FWO as to whether lack of clarity as to accrual of wages and other amounts, particularly in respect of incomplete pay periods, is an issue for FWO in practice.

[137] We note that the Health Services Union (the HSU) has indicated that it will not be pursuing its foreshadowed claim to introduce penalties for the late payment of wages into three modern awards: Aboriginal Community Controlled Health Services Award 2010; Aged Care Award 2010; and Social Community, Home Care and Disability Services Industry Award 2010.

[138] ABI and the Master Builders Australia (MBA) have made applications to vary the terms of certain awards which presently provide a penalty for late payment of wages.

[139] MBA has made claims 48 to delete the penalty for late payment of wages in the following awards:

[140] The On-site Award provides that an employee paid by cash or cheque is entitled to payment at overtime rates if the employee is kept waiting for their wages for more than 15 minutes after finishing work on payday (other than in circumstances beyond the control of the employer). 49 The Joinery Award provides that an employee who does not receive their pay by the cessation of ordinary hours of work on Thursday is entitled to payment for waiting time at overtime rates (other than in circumstances beyond the control of the employer).50

[141] The interested parties in relation to these two awards have expressed a preference for these issues to be dealt with during the Award stage of the Review and that is the course which we will adopt.

[142] ABI is seeking to vary the provisions in 10 modern awards which impose a penalty for late payment of wages. The relevant awards are:

[143] Consistent with the approach taken in relation to the MBA’s application we will refer ABI’s application to vary the Joinery Award to the Award stage of the Review. This decision deals with ABI’s proposed variations in respect of the remaining nine awards.

[144] ABI’s variations remove the penalty for late payment of wages in circumstances where wages are paid by EFT.

[145] We turn first to some recent Full Bench decisions dealing with award terms which provide for a penalty for the late payment of wages.

[146] In Re: Timber Industry Award 2010 (No.1) 51 a Full Bench considered a jurisdictional objection by the MBA to the proposal by the CFMEU to vary the award to include a term providing for the payment of a penalty upon the late payment of wages. The Full Bench rejected the MBA’s jurisdictional objection. The Full Bench did not decide the merits of such a variation and nor did it decide whether such a term fell within the power conferred on the Commission by s.139(1), in particular the power to include terms about ‘penalty rates’. However, in relation to the latter matter the Full Bench said:

[147] In Re: Timber Industry Award 2010 (No.2) 53 a differently constituted Full Bench considered the merits of the CFMEU’s proposal and whether the term sought constituted a ‘penalty rate’ within the meaning of s.139(1)(e). As to the second matter the Full Bench was not persuaded that the proposed term was a ‘penalty rate’:

[148] In terms of s.142(1), the Full Bench accepted that an award provision for the imposition of a penalty for the late payment of wages was ‘incidental’ to those elements of s.139 dealing with payments to employees: minimum wages; overtime rates; penalty rates, and allowances. However, the Full Bench was not satisfied that the proposed term was ‘essential for the purpose of making a particular term operate in a practical way’ as required by s.142(1)(b), noting that:

[149] As to the modern awards objective, the Full Bench concluded:

[150] Of particular relevance to the matters before us is the observation by the Full Bench in respect of the imposition of a penalty for late payment where wages are paid by EFT:

[151] This issue was also considered in the context of an application to delete the penalty for late payment applying to payment by cash, bank cheque or EFT in the Professional Diving Industry (Industrial) Award 2010. In that matter the Full Bench adopted the views expressed in Re: Timber Industry Award 2010 (No.2) as follows: 58

[152] The following general propositions may be derived from the decisions referred to above:

[153] United Voice and the AWU do not oppose the ABI application to vary the remaining nine awards referred to at [142]-[143] above. No other party made submissions in respect of ABI’s application. (Noting that the application to vary the Joinery Award was referred to the Award stage of the Review.)

[154] We accept that, as a general proposition, late payment penalties are not appropriate in circumstances where employees are paid by EFT. We acknowledge that there may be circumstances pertaining to a particular modern award that warrant a different approach. But no such circumstances were advanced in respect of the modern awards before us.

[155] We are satisfied that the existing terms in these nine modern awards lack merit insofar as they impose a penalty for the late payment of wages where employees are paid by EFT. To that extent the existing terms are not ‘fair’ within the meaning of the modern awards objective. In arriving at that conclusion we have taken into account the matters set out in s.134(1)(a) to (h), insofar as they are relevant. It is likely that some of the employees covered by these awards are ‘low paid’ within the meaning of s.134(1)(a) and that the variation proposed may be said to diminish the capacity of those employees to meet their needs. But the impact is likely to very limited as the penalty payment only arises in very limited circumstances. Similarly, the variations may reduce employment costs (s.134(1)(f)), but only to a very limited extent.

[156] We propose to vary the nine modern awards which are the subject of the ABI application before us. Draft variation determinations will be issued shortly. Interested parties will have 7 days to comment on the drafts.

[157] In the event we granted ABI’s claim, United Voice submitted that a note should be inserted into the relevant awards, after the payment of wages clause, indicating that there are serious consequences for non-compliance. The proposed note was in the following terms:

[158] United Voice acknowledges that the proposed note would be merely ‘declaratory’ and ‘would be doing no more than clarifying the position and ensuring that the Award reflects the importance that the Parliament has chosen to attach to the timely payment of wages’. 60

[159] We are not persuaded that a note in the form proposed is necessary. There is no need to clarify any particular uncertainty. Further, contravention of a term of a modern award itself attracts a civil penalty (s.45) and the maximum penalty (60 penalty units) is the same as that prescribed for a breach of s.323 (see s.539). There is nothing particularly significant about the payment of wages clause that would warrant the insertion of such a note. We also observe that in previous decisions the Commission has declined to vary awards to insert provisions which may be characterised as ‘aspirational’ and which have little or no work to do. 61 We do not propose to insert a note of the type proposed by United Voice.

[160] Attachment C contains a list of the 20 modern awards which provide penalties for late payment of wages, including the 10 awards listed at paragraph [142] above. The penalty provisions in the remaining 10 awards are limited to payment by cash or cheque and so we do not propose to consider those provisions further.

[161] Ai Group seeks to vary three modern awards to address what it submits is an anomaly in the annual leave clauses relating to provisions dealing with payment of annual leave and annual leave loading. These awards are:

[162] Ai Group submits that the respective award clauses can be read as inappropriately entitling employees to either:

[163] The interested parties have reached an agreement in respect of the proposed variation of the Electrical, Electronic and Communications Contracting Award 2010 and the Food, Beverage and Tobacco Manufacturing Award 2010. The submissions advanced in support of these variations are set out in Ai Group’s written submission of 20 September 2016.

[164] We also note that a similar, but not identical issue, was dealt with in respect of the Manufacturing and Associated Industries and Occupations Award 2010 62, where the Full Bench determined that a clause in the exposure draft would be amended to remove a potential anomaly that might allow for payment of shift loadings and annual leave loadings for periods of annual leave.

[165] The proposed variation of the Joinery Award is opposed by the CFMEU.

[166] Subclauses 32.2 and 32.3 of the Joinery Award state:

[167] In 2013 Ai Group sought to vary cl.32.2(c) pursuant to s.160 of the FW Act, on the basis that cl.32.2(b) was ambiguous and uncertain. In particular, it was contended that it was unclear whether the rate of pay which was to be paid to an employee for a period of annual leave was – in the case of shiftworkers – to include the shift rates in cl.28.3(d). The application was dismissed by Senior Deputy President Drake 63 on the basis that the relevant provision was not ambiguous or uncertain – shift rates were to be paid to shiftworkers on a period of annual leave.

[168] In the present proceedings Ai Group seeks to delete cl.32.2(c) and insert the following term:

[169] Ai Group also proposes the deletion of cl. 32.3 and that it be replaced with the following term:

[170] The intent of the variations is to ensure that employees do not receive both a shift loading and an annual leave loading during a period of annual leave, rather, they will receive whichever is the greater.

[171] We note that the Joinery Award was largely based on the National Joinery and Building Trades Products Award 2002 (the 2002 Award), 64 as it applied in the off-site sector. The relevant clause in the 2002 Award was cl.30.7, which was in the following terms:

[172] Ai Group submits that the provisions of the Joinery Award are inconsistent with the modern awards objective. It is submitted that the current award terms are not ‘fair’ for the following reasons:

[173] As we have mentioned, the CFMEU opposes the variation of the Joinery Award. The CFMEU’s position is summarised at paragraph 62 of its submission of 14 October 2016:

[174] Contrary to the CFMEU’s submission it is not necessary to establish ‘some significant change’ since the review of the Joinery Award in the Transitional Review.

[175] In conducting the Review the Commission will have regard to the historical context applicable to each modern award and will proceed on the basis that prima facie the modern award being reviewed achieved the modern awards objective at the time it was made. The adoption of the prima facie position is an instance of the general proposition that previous Full Bench decisions should generally be followed, in the absent of cogent reasons for not doing so. In the context of the Review it is appropriate to take into account previous Full Bench decisions relevant to any contested issue. The weight to be accorded to a previous Full Bench decision depends on the context - the legislative context and the issues considered by the Full Bench.

[176] The decision relied on by the CFMEU is of little relevance to the present proceeding. The legislative context was quite different – the Review is broader in scope than the Transitional Review completed in 2013. Further, in the Transitional Review proceedings there was no debate as to the merits of the award terms which are the subject of the matter before us; nor was the issue before us the subject of debate in the award modernisation proceedings.

[177] The CFMEU also points to the fact that the Ai Group has ‘provided no evidence to support the variation sought’. This point is the subject of some elaboration in the CFMEU’s written submissions:

[178] This submission is misconceived. As the Commission observed in the Preliminary Jurisdictional Issues decision:

[179] The issue raised by Ai Group is not one that requires probative evidence in support of the proposed variation. It turns on an assessment of the merits of the award term.

[180] In particular, it is unnecessary to adduce evidence of the costs imposed by the existing term, as those costs are self-evident from the term itself, and evidence from employers about their subjective views of the merit of the particular term would be of little assistance.

[181] The issue for us is whether the modern award, together with the NES, provides a fair and relevant safety net of terms and conditions. Fairness in this context is to be assessed from the perspective of the employees and employers covered by the modern award in question.

[182] We have concluded that clauses 32.2 and 32.3 do not provide a ‘fair … safety net’.

[183] The existing terms provide that the annual leave payment made to shiftworkers includes both the applicable shift rate and the 17.5 per cent annual leave loading. It appears that these terms were inserted into a predecessor award by consent. 68 We were not taken to any arbitral decision which considered the question of annual leave payments in this award (or a predecessor award).

[184] The provision of an annual leave payment which includes both a shift penalty and a 17.5 per cent loading is unusual. It is not a feature of other construction awards. For example, the On-site Award provides for the payment of ‘the amount which [the employee] would have received for working ordinary time hours if they had not been on leave’ and a 17.5 per cent annual leave loading. But clause 38.2(c) provides:

[185] In other words, shiftworkers employed under the On-site Award get either the relevant shift loading or the 17.5 per cent annual leave loading (whichever is the greater), but not both. There are similar provisions in the Mobile Crane Hiring Award 2010 (at clause 25.4(b)).

[186] We were not taken to any other modern award which provides that the annual leave payment to shiftworkers includes both their shift loading and an annual leave loading.

[187] The arbitral consideration of annual leave payments is limited. The issue was given some attention in the 1971 Annual Leave Case. 69 The claims in that case sought:

[188] The Commission dismissed claims (ii) and (iii). In respect of claim (i) the Commission said:

[189] At the time this decision was made many employees under Federal awards were paid their award minimum rate of pay when they went on annual leave, without the addition of payments (such as shift loadings) which they may have regularly received when they were at work. 71

[190] In respect of the prima facie view in the 1971 Annual Leave decision that ‘an employee taking annual leave … shall be paid the amount of wages (or salary) he would have received in respect of the ordinary time which he would have worked had he not been on leave during the relevant period’, the Commission made the following ‘announcement’:

[191] In the above statement the Commission was clearly expressing the view that the norm in respect of annual leave payments was that:

[192] The existing terms of the Joinery Award are inconsistent with the norm expressed by the Commission in the 1971 Annual Leave Case in that they require the payment of both an annual leave bonus (the 17.5 per cent loading) and the applicable shift rate.

[193] Of course in establishing the norm in respect of annual leave payments the Commission was not setting an immutable test case standard in respect of this issue. It was clearly envisaged that in individual awards special circumstances may require some departure from the expressed norm. But there is nothing before us to suggest that there are special circumstances pertaining to the Joinery Award which warrant some departure from the norm.

[194] In short, the existing terms in the Joinery Award are:

[195] In these circumstances we are satisfied that the existing terms lack merit and are not ‘fair’, within the meaning of the modern awards objective. In arriving at that conclusion we have taken into account the matters set out at s.134(1)(a) to (h), insofar as they are relevant. We accept that some of the employees covered by the Joinery Award are ‘low paid’ within the meaning of s.134(1)(a) and that the variation proposed by Ai Group will diminish the capacity of those employees to meet their needs, though the impact will be limited as it will only arise when the employees receive an annual leave payment. The variation proposed will also reduce employment costs (s.134(1)(f)).

[196] We propose to vary the Joinery Award in the manner proposed by Ai Group. We are satisfied that the award term (as varied) is necessary to achieve the modern awards objective.

[197] For the same reasons we propose to vary the Food, Beverage and Tobacco Manufacturing Award 2010 and the Electrical, Electronic and Communications Contracting Award 2010 in the manner proposed by Ai Group and agreed by the other interested parties.

3. Next Steps

[198] For the reasons given:

[199] The draft variation determinations referred to above will be issued shortly. Interested parties will have 7 days to comment on the drafts. All comments are to be sent to [email protected] and will be published on the Commission’s website in the usual way.

PRESIDENT

Appearances:

L Izzo for the Australian Chamber of Commerce and Industry, Australian Business Industrial & NSW Business Chamber

M Adler for the Housing Industry Association

R Bhatt and S Smith for the Australian Industry Group

R Sostarko for the Master Builders Australia Limited
S Bull, for United Voice
R Walsh for The Australian Workers’ Union
W Tegg for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)
W Carr for the Transport Workers’ Union of Australia

P Boncardo for the Construction, Forestry, Mining and Energy Union

A Thomas for the Construction, Forestry, Mining and Energy Union – Mining and Energy Division

V Wiles for the Textile, Clothing and Footwear Union of Australia

G Marton for the Victorian Automobile Chamber of Commerce and the Motor Trades Association

K Pearsall for the National Farmers’ Federation

T Evans for the Australian Hotels Association

Hearing details:

Sydney.

2016.

21 October.

<Price code J, PR587887>

ATTACHMENT A—Submissions received

ABI & NSW Business Chamber Submission

27 June 2016

Master Builders Australia – Submission

30 June 2016

Ai Group – Correspondence

30 June 2016

Master Builders Australia – Correspondence

11 July 2016

SDA – Submission and draft determinations

19 July 2016

Ai Group – Correspondence and draft determinations

19 July 2016

Master Builders Australia – Submission and draft determinations

20 July 2016

SDA – Submission

10 August 2016

Ai Group – Correspondence and draft determinations

24 August 2016

AMWU – Correspondence

24 August 2016

ABI & NSW Business Chamber – Submission – supporting evidence

20 September 2016

Australian Hotels Association – Submission

20 September 2016

Ai Group – Correspondence and draft determinations

26 April 2016

Ai Group – Submission

20 September 2016

CFMEU – Mining and Energy Division – Submission – draft determination

20 September 2016

Housing Industry Association – Submission

20 September 2016

Master Builders Australia – Submission

20 September 2016

National Farmers’ Federation – Submission – draft determination

20 September 2016

SDA– Report back, agreed payment of wages terms

16 September 2016

Ai Group – Submission in reply (dated 13 August 2016)

13 October 2016

SDA– Submission in reply

13 October 2016

Coal Mining Industry Employer Group – Submission in reply

13 October 2016

United Voice – Submission in reply

13 October 2016

CFMEU – Mining and Energy Division – Submission in reply

13 October 2016

AMWU – Submission in reply

13 October 2016

CFMEU – Forestry, Furnishing, Building Products & Manufacturing Division – Submission in reply

14 October 2016

TCFUA – Submission in reply

14 October 2016

CFMEU – Construction & General Division – Submission in reply

14 October 2016

AWU – Submission in reply

17 October 2016

Ai Group – correspondence re: timetable

17 October 2016

TWU – submission in reply

17 October 2016

National Road Transport Association (NatRoad) – Submission

17 October 2016

CFMEU – Mining and Energy Division – Submission in reply Black Coal

18 October 2016

NFF – Submission in reply

18 October 2016

Australian Meat Industry Council – Submission in reply

18 October 2016

ABI & NSWBC – submission in reply

19 October 2016

Master Builders Australia – submission in reply

19 October 2016

United Voice – submission-additional claims

19 October 2016

ABI & NSWBC – submission in reply - additional

19 October 2016

CMIEG – submission in reply

19 October 2016

Ai Group – Submission in reply

19 October 2016

HIA– Submissions in reply to the CFMEU subs of 14/10

20 October 2016

Australian Hotels Association – submission- statement questions

20 October 2016

Master Builders Association – submission- statement questions

21 October 2016

ATTACHMENT B—Payment of wages on termination

Award

Method of payment

Provision for payment on termination

Timeframe for payment on termination

Aged Care Award 2010 [MA000018]

Cash or EFT

Clause 17.3

When notice of termination of employment has been given by an employee or an employee’s services have been terminated by an employer, payment of all wages and other moneys owing to an employee will be made to the employee by no later than the last day of the formal notice period.

Aluminium Industry Award 2010 [MA000060]

Cash, cheque or EFT

Clause 17.3

On termination of employment, wages due to an employee must be paid on the day of termination or paid to the employee by the next regular pay day in accordance with clause 17.2.

Asphalt Industry Award 2010 [MA000054]

Cash, cheque or EFT

Clause 19.3

On termination of employment the wages due to an employee must be paid on the day of termination or be forwarded to the employee within 2 business days after termination.

Black Coal Mining Industry Award 2010 [MA000001]

Cheque or EFT

Clause 16.7

Upon termination of employment, wages due to an employee will be paid on the day of such termination or forwarded by post, within 72 hours, to the last address notified in writing by the employee.

Note also cl. 13.5 which sets out payments on termination.

Building and Construction General On-site Award 2010 [MA000020]

Cash, cheque, bank cheque or EFT

Clause 31.4

When notice is given, all monies due to the employee must be paid at the time of termination of employment. Where this is not practicable, the employer will have two working days to send monies due to the employee by registered post (or where paid by EFT the monies are transferred into the employee’s account).

Business Equipment Award 2010 [MA000021]

Cash, cheque or EFT

Clause 25.4

Upon termination of employment, the wages due to an employee must be paid on the day of such termination or forwarded by post on the next working day.

Children’s Services Award 2010 [MA000120]

Cash, cheque or EFT

Clause 19.3

Where an employee lawfully leaves their employment they will be paid all moneys due at the time of leaving by cash, cheque or electronic funds transfer. Alternatively, the employee may be paid on the next working day where this is reasonable.

Dry Cleaning and Laundry Industry Award 2010 [MA000096]

Cash or EFT

Clause 19.3

When notice of termination of employment has been given by an employee or an employee’s services have been terminated by an employer, payment of all wages and other money owing to an employee will be made to the employee by no later than the last day of the formal notice period.

Electrical, Electronic and Communications Contracting Award 2010 [MA000025]

  

Clause 22.3

(a) On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee by post on the next working day.

(b) Where an employee is paid under a rostered day off system and has accrued a credit towards a rostered day off such credit must be taken into account in calculating wages due on termination.

Food, Beverage and Tobacco Manufacturing Award 2010 [MA000073]

Cash, cheque or EFT

Clause 28.3

On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee on the next working day.

Graphic Arts, Printing and Publishing Award 2010 [MA000026]

Cash, cheque or EFT

Clause 28.5

On termination of employment, all monies due to an employee must be paid on the day of termination. When an employee is dismissed without notice all monies are to be forwarded to the employee by post or electronic funds transfer by the end of the next business day following the termination.

Horse and Greyhound Training Award 2010 [MA000008]

Cash, cheque or EFT

Clause 18.1

When an employee’s employment is terminated before the usual payday, the employee must be paid all wages and holiday pay to which the employee is entitled within 24 hours of leaving the employer’s service.

Horticulture Award 2010 [MA000028]

Cash, cheque or EFT

Clause 19.3

On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee by post on the next working day.

Manufacturing and Associated Industries and Occupations Award 2010 [MA000010]

Cash, cheque or EFT

Clause 34.3

On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee by post on the next working day.

Market and Social Research Award 2010 [MA000030]

EFT or by agreement cash or cheque

Clause 19.5

An employer must, on request, provide to an employee on termination a detailed statement of outstanding entitlements. The wages due to an employee must be paid on the day of such termination or forwarded via post on the next working day.

Meat Industry Award 2010 [MA000059]

“In manner agreed”

Clause 29.2

Upon termination of employment, any wages due to an employee will be paid on the day of such termination or, at the employee’s option, forwarded to them on the next working day.

Mobile Crane Hiring Award 2010 [MA000032]

Cash, cheque or EFT

Clause 19.5

Upon termination of employment, wages due will be paid on the day of such termination or forwarded by electronic transfer or post on the next working day.

Nursery Award 2010 [MA000033]

Cash, cheque or EFT

Clause 22.3

On termination of the employment, the wages due to an employee must be paid on the day of termination or be forwarded to the employee within 2 business days after termination.

Nurses Award 2010 [MA000034]

Cash, cheque or EFT

Clause 18.3

When notice of termination of employment has been given by an employee or an employee’s services have been terminated by the employer, payment of all wages and other monies owing to an employee will be made to the employee.

Passenger Vehicle Transportation Award 2010 [MA000063]

The employer at its discretion may pay an employee by electronic funds transfer to a bank account nominated by an employee

Clause 19.4

Notwithstanding anything contained in this clause, the employer must pay to an employee who leaves or is dismissed all moneys due to the employee within two working days.

Pastoral Award 2010 [MA000035]

Cash, cheque or EFT

Clause 16.3

On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee by post on the next working day.

Pharmaceutical Industry Award 2010 [MA000069]

Cash, cheque or EFT

Clause 21.3

On termination of employment the wages due to an employee must be paid on the day of such termination or be forwarded to them within 2 business days after termination.

Plumbing and Fire Sprinklers Award 2010 [MA000036

Cash, cheque, bank cheque or EFT

  

When notice is given in accordance with clause 17—Termination of employment, monies due to the employee must be paid at the time of termination. Where this is not practicable monies will be sent by registered post or, if the employee is normally paid by electronic funds transfer, transferred into the employee’s account within two working days.

Note- penalty payment for waiting time (ordinary rates for 8 hours per day for up to a week)

Professional Diving Industry (Industrial) Award 2010 [MA000108]

Cash, cheque, bank cheque or EFT

Clause 19.4

On termination of employment, wages due to employees must be paid to them on the day of such termination or forwarded to them by post on the next working day.

Professional Diving Industry (Recreational) Award 2010 [MA000109]

Cash, cheque, bank cheque or EFT

Clause 18.4

On termination of employment, wages due to employees must be paid to them on the day of such termination or forwarded to them by post on the next working day.

Restaurant Industry Award 2010 [MA000119]CSH,

Cash, cheque or EFT

Clauses 27.4 and 27.5

27.4 When notice of termination of employment has been given by an employee or an employee’s services have been terminated by an employer, payment of all wages due must be made during working time, prior to the employee leaving their employment.

27.5 Where an employee is dismissed for misconduct the employee must be paid within one hour of their dismissal or as soon as practicable thereafter.

Road Transport (Long Distance Operations) Award 2010 [MA000039]

EFT at the employer’s discretion

Clause 18.3

Notwithstanding anything contained in this clause, the employer must pay to an employee who leaves or is dismissed all money due to the employee immediately

Road Transport and Distribution Award 2010 [MA000038]

EFT at employer’s discretion

Clause 20.3

Notwithstanding anything contained in this clause, the employer must pay to an employee who leaves or is dismissed all moneys due to the employee forthwith.

Seafood Processing Award 2010 [MA000068]

Cash, cheque or EFT

Clause 21.3

On the day of termination or forwarded within 48 hours.

Silviculture Award 2010 [MA000040]

Cash, cheque or EFT

Clause 21.3

When notice is given in accordance with the NES, all money due to the employee pursuant to this award must be paid at the time of termination. Where this is not practicable, the employer must, within two clear working days of the termination, transfer all money due by electronic funds transfer or by registered post to the employee’s home address.

Any time spent waiting beyond the two working days must be paid for at ordinary rates of eight hours per day for up to one week.

Storage Services and Wholesale Award 2010 [MA000084]

Cash or cheque during working hours or by EFT

Clause 20.3

On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee as soon as reasonably practicable and within two working days after the termination.

Supported Employment Services Award 2010 [MA000103]

Cash, cheque or EFT, as determined by employer.

Clause 18.4 and 18.5

18.4 Where an employee is discharged from employment the employee will be paid immediately for all wages, overtime, pro rata payment for annual leave, annual leave loading or any remuneration due. Payment may be made by cash, cheque or electronic funds transfer at the discretion of the employer.

18.5 Where an employee lawfully leaves their employment they will be paid all monies due at the time of leaving. Payment may be made by cash, cheque or electronic funds transfer at the discretion of the employer.

18.6 In the event of a delay of this payment, within the control of the employer, the employee to be paid ordinary time rates for ‘waiting time’. Time kept waiting will be deemed to operate after 6pm on the Friday of each pay week where payment made by EFT.

Timber Industry Award 2010 [MA000071]

Cash, cheque or EFT

Clause 25.3

25.3(a) Upon termination after the prescribed period of notice, or where the notice period has been dispensed with in accordance with clause 15 (Redundancy) all monies must be paid at the usual place of payment within 15 minutes of the ceasing time on the day of the termination of employment. If the usual place is at work in the bush, within 30 minutes of the usual ceasing time.

25.3(b) - If the employment is otherwise terminated, no later than the expiration of the pay period.

Vehicle Manufacturing, Repair, Services and Retail Award 2010 [MA000089]

Cash or, with the agreement of the majority of workers in a workplace, by cheque or direct transfer.

An employer and an employee may agree to pay by cheque or direct transfer.

Clause 24.4

(a) Upon termination of the employment, the employer will pay wages due to an employee:

(i) on the day of such termination;

(ii) by forwarding such wages to the employee on the next working day; or

(iii) at the employer’s place of business on a stated day not later than seven days after such termination. If the employer requires the employee to visit such place of business to collect wages then, in addition to the amount of moneys due, the employer will pay the employee an additional four hours’ ordinary pay.

Except that where an employee abandons his or her employment or the employee’s employment is terminated without notice for serious and wilful misconduct the employer will pay the wages due to the employee within two business days (not including a Saturday, Sunday or public holiday) of the termination.

(b) An employer may deduct from monies due to an employee such amount as is authorised in writing by the employee for a lawful purpose specified in the authority.

Waste Management Award 2010 [MA000043]

At the employer’s discretion, by EFT.

Clause 24.3

Despite anything contained in this clause, the employer must pay to an employee who leaves or is dismissed all money due to the employee as soon as possible.

Wine Industry Award 2010

Cash or EFT

Clause 26.3

On termination of the employment, wages due to an employee must be paid on the day of such termination or be forwarded to the employee on the next working day.

ATTACHMENT C—Awards that contain penalty for late payment of wages provisions

Award code

Award

Rate of penalty payment for late payment of wages

MA000060

Aluminium Industry Award 2010

Overtime

MA000054

Asphalt Industry Award 2010

Overtime

MA000020

Building and Construction General On-site Award 2010*

Overtime

MA000022

Cleaning Services Award 2010

Ordinary rates

MA000073

Food, Beverage and Tobacco Manufacturing Award 2010

Overtime

MA000026

Graphic Arts, Printing and Publishing Award 2010

Time and a half

MA000009

Hospitality Industry (General) Award 2010

Overtime

MA000029

Joinery and Building Trades Award 2010*

Overtime

MA000010

Manufacturing and Associated Industries and Occupations Award 2010

Overtime

MA000032

Mobile Crane Hiring Award 2010

Overtime

MA000069

Pharmaceutical Industry Award 2010

Overtime

MA000036

Plumbing and Fire Sprinklers Award 2010

Overtime

MA000108

Professional Diving Industry (Industrial) Award 2010

Overtime

MA000109

Professional Diving Industry (Recreational) Award 2010

Overtime

MA000014

Racing Industry Ground Maintenance Award 2010

3.9% weekly standard rate per day

MA000058

Registered and Licensed Clubs Award 2010

Overtime

MA000068

Seafood Processing Award 2010

Overtime

MA000040

Silviculture Award 2010

Ordinary rates

MA000103

Supported Employment Services Award 2010

Ordinary rates

MA000071

Timber Industry Award 2010^

Overtime

* Awards subject to applications to remove penalty

^ see also Group 1C–E decision [2015] FWCFB 7236 at paras 229–234

 1   4 Yearly Review of Modern Awards – Annual Leave [2016] FWCFB 3177 at [135]-[140]

 2   See s.599 of the FW Act

 3   [2014] FWCFB 1788 at paras [19]–[24] (the Preliminary Jurisdictional Issues Decision)

 4   [2016] FWCFB 4519

 5   [2016] FWCFB 5254

 6   [2016] FWCFB 5741

 7   [2016] FWCFB 6401

 8   [2016] FWCFB 7455

 9   SDA submission 2 March 2015; Transcript 14 December 2015, PN 410

 10   Clerks – Private Sector Award 2010; Educational Services (Schools) General Staff Award 2010; and Educational Services (Teachers) Award 2010

 11   Air Pilots Award 2010; Aircraft Cabin Crew Award 2010; Airline Operations - Ground Staff Award 2010; and Marine Towage Award 2010

 12   Clause 24.2 of the Waste Management Award 2010 provides that ‘[a]ll earnings, including overtime, must be paid within three days of the end of the week in which they accrue.’

 13   [2010] FWA 8218

 14   Ibid at [9]. See further Murrihy v Betezy.com.au Pty Ltd [2013] FCA 908 at 142

 15   See Murrihy v Betezy.com.au Pty Ltd [2013] FCA 908

 16   In relation to payment for leave, see Canavan Building Pty Ltd [2014] FWCFB 3202 at [44]

 17   Rofin Australia Pty Ltd v Newton (1997) 78 IR 78 at 81

 18   See also ss.165(3), 166(5) and 286(5)

 19   For example Transport (Cash in Transit) Award 2010, Storage Services and Wholesale Award 2010 and Security Services Industry Award 2010

 20   RCI correspondence dated 19 July 2016.

 21   See the Waste Management Award 2010 at clause 24.3

 22   See the Plumbing and Fire Sprinklers Award 2010 at clause 27.4

 23   See the Nurses Award 2010 at clause 18.3

 24   See the Horse and Greyhound Training Award 2010

 25   Ai Group submission 20 September 2016 at pp 8 – 9

 26   ABI & NSWBC submission 20 September at 6

 27   CFMEU (Mining and Energy Division) submission 20 September 2016

 28   [2016] FWCFB 7455

 29   See for example Garrick & Mines v Mitsubishi Motors Australia Ltd [2014] SAIRC 38

 30   [2015] FCAFC 20 at [214], also see [135] per Tracey, Gilmour, Jagot and Beach JJ. Also: Taylor & Hose Corp Pty Ltd and Anor [2015] FCCA 1804 at [5]

 31   D’Souza v Henry Schein Halas [2014] FWC 5864 at [29] – [30]; also see s.44(1) of the FW Act

 32   Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337

 33   D’Arcy P, Gustafsson L, Lewis C and Wiltshire T (2012) “Labour Market Turnover and Mobility”, Reserve Bank of Australia Bulletin December Quarter pp 1 – 12 at p 3

 34   Birrell v Australian National Airlines Commission [1984] 9 IR 101

 35   See generally GJ McCarry (1986), ‘Termination of Employment Contracts by Notice’, 60 ALJ 78, pp 78 – 86

 36   ABI submission 20 September 2016 at para 6.2 (o) and (p)

 37   Information received from the Department of Social Services (this will be published on the Commission’s website shortly)

 38   Guide to Social Security Law, 4.3.4.10–Application of the Income Maintenance Period (IMP) http://guides.dss.gov.au/guide-social-security-law/4/3/4/10

 39   AMWU submissions 13 October 2016 at [34]

 40   Section 127 provides that the Regulations may permit modern awards to include terms that would or might otherwise be contrary to Part 2-2 or s.55, or prohibit modern awards from including terms that would or might otherwise be permitted by Part 2-2 or s.55. No such regulations have been made.

 41   Maritime Union of Australia v Maersk Crewing Australia [2016] FWCFB 1894 at [21]

 42   See Re Armacell Australia Pty Ltd (2010) 202 IR 38 at [18] – [19]; Re Hull-Moody Finishes Pty Ltd [2011] FWAFB 6709 at [26]; and Re Canavan Building Pty Ltd [2014] FWCFB 3202 at [36]; and 4 yearly review of modern awards – Alleged NES Inconsistencies [2015] FWCFB 3023 at [37]

 43   See for example, Stewart A, Forsyth A, Irving M, Johnstone R and McCrystal S, Creighton and Stewart’s Labour Law, 6th Edition, The Federation Press, 2016 at [15.58]- [15.59]; Sappideen C, O’Grady P, Riley J, Warburton G, Smith B, Macken’s Law of Employment, 7th Edition, Lawbook Co, 2011, at [11.20] – [11.60]; Irving M, The Contract of Employment, LexisNexis Butterworths Australia, 2012, at [9.26] – [9.34].

 44   Stewart et al note 43 above at [15.58]

 45   Stewart et al note 43above observe at [15.58] that an employee who is not entitled to wages for a broken pay period, may be able to claim damages or reasonable remuneration for restitution if the employee was wrongfully prevented by the employer from completing the pay period.

 46   See Stewart et al note 43 above at [15.58] and Sappideen et al note 43 above at [11.40]

 47   See Irving note 43 above at [9.27]-[928] and Sappideen et al note 43 above at [11.30] – [11.40]. See further Re Waterside Workers Awards (1957) 1 FLR 119 and State Superannuation Board (NSW) & Anor v Criminale & Ors (1988) 26 IR 13.

 48   MBA submissions (Building Joinery) 2 March 2015

 49   MA000020 at clause 31.5

 50   MA000029 at clause 26.3

 51   [2015] FWCFB 1549

 52   Ibid at [29]

 53   [2015] FWCFB 2856

 54   Ibid at [100] and [102]

 55   Ibid at [119]

 56   Ibid at [127]

 57   Ibid at [124]

 58   Ibid at [49] and [2015] FWCFB 7236 at PNS [229] – [234]

 59   [1947] SASR 162; also see Re Darling Harbour Development Project Industrial Agreement (1988) 27 IR 375.

 60   United Voice submission 19 October 2016 at [11] to [16]

 61   4 yearly review of modern awards – Annual Leave [2016] FWCFB 6836 at [59] – [61]

 62   [2015] FWCFB 7236 at [78]

 63   [2014] FWC 32

 64   (2009) 180 IR 124 at [54]

 65   CFEMU (Construction and General Division) reply submission 14 October 2016 at [62]

 66   CFMEU reply submission 14 October 2016

 67   [2014] FWCFB 1788 at [23]

 68   (1972) 147 CAR 447

 69   (1972) 144 CAR 5289

 70   Ibid at paragraph 534

 71   Ibid at paragraph 532

 72   Ibid at paragraphs 544 and 545. We have only set out that part of the Commission’s “Announcement” which is relevant to the matter before us.

Printed by authority of the Commonwealth Government Printer