Legal Services Award 2020 Compliance guide for employers


TABLE OF CONTENTS

Introduction 

Why you need to read this

Where does the Award fit in?

Legal Services Award 2020 requirements

What common mistakes are made by employers?

Award compliance checklist

  1. Does the Legal Services Award 2020 cover your business?
  2. Does the Legal Services Award 2020 apply to your individual employees?
  3. Is the employee full time, part time or casual?
  4. What will be the employee’s ordinary working hours and break entitlements?
  5. Are you paying at least the minimum required wages and allowances?
  6. What are employers’ annual leave obligations?
  7. Can employees make requests for flexible working arrangements?
  8. Can an employee request an individual flexibility arrangement?
  9. Do you have to consult with employees about workplace changes?
  10. How can workplace disputes be resolved?
  11. What are the award based employment termination notice/payment and redundancy requirements?

Some other mistakes

Resources

Checklist summary

Introduction

Why you need to read this

It is important for employers in the legal services profession to comply with the Legal Services Award 2020 (Award) for all their employees covered by the Award. A failure to comply may result in:

  • civil claims for underpayment of wages and entitlements
  • the Fair Work Ombudsman seeking civil penalties for award breaches1
  • criminal wage theft charges in appropriate cases2
  • potential unprofessional conduct implications
  • a disrupted workplace due to unhappy employees and bad public relations consequences in the media.

Where does the Award fit in?

It’s important to understand where your award obligations sit in the employment law hierarchy. The foundations are the National Employment Standards (NES) under the Fair Work Act 2009 (Cth) (Fair Work Act) which apply to all employees. The 11 minimum entitlements of the NES cover:

The Fair Work Act also contains a host of other obligations such as the requirement to keep particular employment records and provisions about unfair dismissal, workplace bullying and sexual harassment, breaches of general protections and sham contracting. It is then necessary to consider whether there is an applicable modern industrial award that applies to an employee. Modern industrial awards are given force by the Fair Work Act and contain more detailed regulation of particular industries or occupations (which should be read in conjunction with the NES). It is not possible to simply opt in or out of an industrial award.

In the area of private legal services, the Legal Services Award 2020 applies to most support staff and graduates. It is possible to enter into a legislatively recognised enterprise agreement with a group of employees (but not an individual) which takes the place of an industrial award. However, this is subject to approval by the Fair Work Commission and subject to employees being better off overall than under the applicable award. The reality is that there is little to be gained at the moment for most employers and employees through the enterprise bargaining process.

Next we have the common law contract of employment. Whilst provisions which are inconsistent with legislation will usually be of no effect, it is still an important document, particularly from an employer’s point of view. Confidentiality and post employment restraint provisions are particularly relevant. It is trite to say that an employment contract should always be in writing, saving the uncertainty of ascertaining any verbal terms.
In the absence of specific contractual agreement, the common law implies certain terms into the employment relationship, such as the need to give reasonable notice on termination.

Lastly, employer policies are an important tool for formalising employer directions about operational matters. Policies may or may not form part of the employment agreement depending on their content and contractual status.

Understanding this hierarchy is the starting point for any successful employment relationship.

Understanding the employment law pyramid

 

 

What common mistakes are made by employers?

Beside the basic mistake of not realising there is a relevant modern industrial award to comply with, the common Award mistakes made by employers include:

  • incorrectly classifying employees
  • not detailing employees’ working hours up front and in writing
  • not updating minimum wages in accordance with award increases
  • not ensuring employees take required breaks
  • not ensuring that overtime is paid when required
  • not understanding the difference between an award annualised wage and a common law annual salary
  • not keeping required time records and not giving correct pay slips
  • not checking to ensure that any computerised payroll software correctly reflects award requirements
  • not ensuring there is a written employment agreement for each employee.

It is compulsory for covered employers to comply with the Award. The only exception is if an employee accepts a high income guarantee in writing from an employer which guarantees the employee will be paid over the high income threshold (currently $158,500pa excluding superannuation – this is indexed from 1 July each year).

Award compliance checklist


1. Does the Legal Services Award 2020 cover your business?4

Does your business:

  • provide legal and/or legal support services? 
  • operate a labour hire business or group training service providing labour hire employees or trainees in the legal services industry?

If so, your business will be covered by the Award. It covers all private legal practices. The Award does not cover:

  • community legal centres
  • Aboriginal legal services
  • employers whose primary activity is not within the legal services industry; or
  • the State public service.

The Award will also not apply to employers with an existing enterprise agreement.  

2. Does the Legal Services Award 2020 apply to your individual employees?5

Is your employee:

  • undertaking work of a clerical or administrative nature?
  • a law clerk as defined?
  • a law graduate as defined?

If so, the Award will apply to their employment and the Award contains classifications prescribing minimum rates of pay for each classification.6

The Award does not cover:

  • admitted solicitors
  • other employed professionals such as information technology employees and accountants
  • CEOs and other senior managerial staff.

a) How do you determine the appropriate employee classification level?

Each classification level for legal clerical and administrative employees sets out the characteristics, generic skills and core skills of jobs at that level starting from an introductory level and progressing through levels requiring increasing skills and experience. The characteristics section of each level covers things such as the required level of supervision, competency and indicative training. A statement of generic duties and skills is provided for each level covering problem solving, literacy and numeracy skills. The statement of core skills starts with skills in the areas of information handling, communication, enterprise/industry, technology, organisation, team and business/financial and progresses to more complex skills at each level. Skills in the legal area are included in the upper levels including, for example, a working knowledge of relevant legal systems and skills in routine legal procedures and documentation.

It is necessary to compare the requirements of a job position description with the Award classification levels to determine which level best suits the actual job being performed. A Level 1 Legal clerical and administrative employee role is, for example, an entry level role usually working under a degree of direct supervision and comprising basic clerical and administrative tasks, including some financial tasks. Each succeeding level includes the skills of previous levels but with escalating expertise and independence. So, legal, clerical and administrative employees at the highest level (Level 5) work under broad guidance with self directed application of knowledge and skills used independently.

Assessment of the appropriate award classification does not involve application of a precise formula but rather a practical judgment of the level that best fits the particular skills required for the job in question. It is always wise to err on the side of caution in this assessment because each classification level is associated with a minimum pay rate under the Award. Ongoing assessment is also necessary as an employee moves through each applicable level as their skills and responsibilities increase.

b) Who is a “law graduate”?

The definitions clause of the Award defines a law graduate as an employee who has completed a legal qualification and is undertaking a period of training in a law firm in satisfaction of the requirements prescribed for admission to practice. This does not include lawyers admitted to practice in a foreign jurisdiction. The law graduate classification requires completion of a relevant degree, a formal offer by the employer and registration and approval of documentation required by relevant governing bodies.

c) Who is a “law clerk”?

The definitions clause of the Award defines a law clerk as a clerk who spends most of their time interviewing clients, preparing documents and general work assisting a barrister or solicitor in their office. The term does not include account clerks, law graduates, titles office clerks, receptionists and employees principally engaged in clerical or routine duties.7 The law clerk classification requires an indicative education level of Associate Diploma at TAFE or tertiary level (or equivalent) with the ability to display a practical understanding and application of the structures, methods and procedures of the relevant legal system. Work occurs under limited guidance involving the use of significant judgment related to products, services, operations or processes of the firm.

The law clerk classification does not require specific clerical and administrative competencies and sits above the highest legal, clerical and administrative classification.

d) Are you engaging a work experience clerk?

The definitions clause of the Award also contains a definition of “work experience clerk” as a person who is employed for no more than 2 months in a consecutive 12 month period for the purpose of gaining experience. The term does not include law students or persons performing a formal work experience program. It is not reflected in any Award classification nor is the term used anywhere else in the Award. The implication is that someone who is employed for more than 2 months in a consecutive 12 month period may be subject to award classifications.

e) Have you made sure that the Award and NES are available to employees, whether on a notice board or by accessible electronic means?

It is an Award requirement that employers ensure that copies of the Award and NES are available to all employees, either on a notice board which is conveniently located at or near the workplace or through accessible electronic means.8

3. Is the employee full time, part time or casual?9

(a) Is the employee going to work:

  • a standard full time 38 hour week? If so, they are a full time employee.
  • less than 38 hours per week on a reasonably predictable basis? If so they are a part time employee and you must specify in writing, before the employee starts work:
    • the days of the week they will work
    • the number of hours each day to be worked10
    • starting and finishing times on each day; and
    • their award classification.

*Example – “Days to be worked: Monday, Wednesday, Friday

Commencement and finishing times for each day: 9am to 3pm

Number of hours to be worked each day: 5.5 hours per day with a half hour lunch break.”

(b) Is there no firm advance commitment to continuing and indefinite work according to an agreed pattern? If so, the employee will be a casual employee.11 Relevant statutory factors are whether:

  • the employer can offer work and the employee can accept or reject it
  • the person will work according to the needs of the employer
  • the employment is described as casual
  • the employee is paid a casual loading.
    *Example – A casual employment agreement should, at the minimum, state:
    • “The employment will be on a casual basis, as required”.
    • “The employee may accept or reject any offer of casual work”.
    • “Each occasion worked will be a separate contract of employment that ceases at the end of that engagement”.
    • “As a casual employee, there is no guarantee of ongoing or regular work”.
    • “The employee will be paid at the hourly rate of $___ plus a 25% casual loading of $___”.

(c) Have you informed each employee of their terms of engagement, including their award classification and whether they are employed on a full-time, part-time or casual basis, at or before the time of their engagement?

(d) Other points to note:

  • Both full-time and part-time work are indefinite forms of employment. The defining feature of part-time employment is that the employee works less than 38 hours per week. Otherwise, the part-time employee receives the same pay and conditions as a full-time employee on a pro rata basis. Any time worked outside the agreed days, hours and times is regarded as overtime. 
  • Casual employment, on the other hand, is by nature uncertain and each engagement forms a separate period of employment. It should not be considered a means of avoiding the obligations of indefinite employment. In recognition of the inherent insecurity of casual employment (and their ineligibility for paid leave entitlements), casual employees:
    • must be paid a 25% loading on the applicable minimum award payment rate
    • cannot be employed for less than 4 hours per occasion
    • may be entitled to be offered, or request, conversion to full-time employment or part-time employment if they have worked for an employer for at least 12 months and have, during at least the last 6 months of that time, worked a regular pattern of hours on an ongoing basis.12
  • An employee can only be employed on a full time, part time or casual basis. There are no other options.

4. What will be the employee’s ordinary working hours and break entitlements?13

Working hours may comprise ordinary hours and additional hours that are not unreasonable. Ordinary hours of work are an employee’s standard hours of work. The Award contains certain rules about hours of work and breaks which apply to all types of employees:

  • ordinary full time hours for day workers are to average 38 hours per week but must not exceed 152 hours over 28 days (different rules apply for shiftworkers)

*Example – a full time employee who has the care of a child for 2 weeks each month could, by agreement, work 23.5 hours per week for 2 weeks and 52.5 hours a week for the other 2 weeks.14

  • ordinary hours may be worked from Monday to Friday between 7.00am and 6.30pm (this can be altered by one hour at either end by agreement with a majority of employees). This is known as the “spread” or “span” of ordinary hours.

Other points to note:

  • any additional hours OR work performed outside the ordinary spread of hours is treated as overtime.

*Example – if a full time employee agrees to work from 8.30am to 4pm 5 days a week with a half hour lunch break and 3 hours on a Saturday, the Saturday time will be treated as overtime.

*Example – If a full time employee working 38 hours a week is asked to work back for an hour, that additional hour is treated as overtime.

  • an unpaid meal break of between 30 and 60 minutes MUST be taken not later than five hours after the employee starts their ordinary hours of work each day.15This is not a matter of choice and is compulsory.
  • employees are allowed to take two paid 10 minutes rest breaks each day at a time suitable to the employer’s reasonable business needs with one in the morning and one in the afternoon. 
  • any rostered day off (RDO) arrangements must be in writing and outline:
    • the method of accruing time towards an RDO
    • an agreed method of accumulating and taking RDOs.

*Example – an employee works 8 hours a day and gets one RDO every 4 weeks. The employee is paid for 7.6 hours per day in order to receive one paid day off each 4 weeks. The RDO is to be taken on a week day or substituted for another working day as agreed between the employer and employee but not more than 5 RDOs are to be accumulated.

  • if an employee takes time off during the working day, they may work make up time as long as this is within the spread of ordinary hours.

*Example – Employee A normally works until 5pm each day. They have to leave one day at 3pm for a parent/teacher meeting. They can work 2 hours make up time anytime between 7am and 6.30pm Monday to Friday.

5. Are you paying at least the minimum required wages and allowances?16

a) Are you paying at least the minimum wage rates?

An employer must pay at least the minimum wage rates contained in the Award (and add the casual loading for casual employees) for ordinary hours of work.17 Schedule B to the Award contains a summary of minimum hourly rates of pay including overtime and penalty rates. The Award also contains minimum rates for junior employees and employees subject to traineeships or the supported wage systems.18  

b) Are you paying wages when required?19

Wages must be paid fortnightly, unless agreed otherwise, by cash, cheque or EFT into a bank or financial institution account nominated by the employee. All amounts due on termination of employment must be paid within seven days of the employment ending.

c) Are you required to pay allowances?20 

An employer may also be required to pay allowances, principally:

  • meal allowance in some overtime situations
  • uniform allowance where any special uniform, dress or clothing is required (unless supplied and laundered by the employer)
  • vehicle allowance where an employee is required to use their own vehicle for occasional work purposes (currently $0.80 per kilometre for motor car usage)
  • where an employee is required as a condition of their employment to provide a motor vehicle for work purposes, then the employer is required to pay all expenses including registration, running and maintenance21
  • reimbursement of travelling costs home where an employee finishes overtime late.

d) Are you meeting superannuation requirements?22 

Compulsory superannuation contributions must be paid into a fund of the employee’s choice including any additional contributions authorised by the employee. If the employee does not have a fund of choice, then the Award sets out the particular superannuation funds into which payment may be made under the award.23 Employers may also need to make enquiry to see whether any superannuation stapling requirements apply under superannuation legislation.

e) Will the employee be required to work overtime or outside the span of ordinary hours?24

The NES specify that an employer must not request or require a full time employee to work more than 38 hours per week unless the additional hours are reasonable. An employee may refuse to work unreasonable additional hours and the NES contains a list of factors to be considered in deciding whether additional hours are reasonable. This applies to all employees, not just award covered employees.25

Overtime rates must be paid if an employee works:

  • outside the spread of ordinary hours on any day; or
  • in excess of the average of 38 hours per week for full time employees; or
  • in excess of the agreed number of hours for part time employees.26

*Example – If A normally starts at 7am but is asked to come in at 6.30am one morning to prepare urgent court material, the extra half hour is treated as overtime.

*Example – If B works part time from 9am to 3pm five days a week, and is asked to work until 4pm one day, the additional hour is treated as overtime.

These rates vary between time and a half and double time and a half with minimum payment requirements.27

There are also detailed requirements for breaks during overtime work and rest periods before the resumption of work as well as for call backs, standing by and shiftworkers (ie not dayworkers).28

If employers wish to avoid overtime requirements, they need to be careful to ensure compliance with ordinary working hours. In particular, hours worked at night or on weekends, even voluntarily, can be subject to overtime requirements which cannot be contracted out of.

f) Can an employee take time off in lieu of payment for overtime (TOIL)?29

Yes, but it is up to the employee whether they wish to do this or not and you will need the employee’s agreement in writing. This is subject to detailed requirements including the need for separate and specific written agreement per occasion. A general contractual or policy provision will not be sufficient. The employee can also change their mind and require payment and if TOIL has not been taken within six months it must be paid out. An employer must not exert undue influence or undue pressure on an employee to make a TOIL agreement. The Award contains an example of a suitable agreement.30

*Example – An employee who works 3 hours on a Saturday morning can, by written agreement, take 3 hours off from their ordinary hours of work as TOIL. 

g) Can you pay an “all up” rate of pay or annual salary? 

It is important for employers to understand that an employee cannot be paid less than the minimum rates (including overtime and penalty rates) and allowances specified by the Award, even by agreement. There are serious penalties for failing to observe these provisions. An employer can pay above Award rates but it is equally important that properly documented arrangements are put in place to formalise such arrangements and to provide the employer with a level of protection. There are three approaches that employers could consider:

Option A.

An employer can pay an above award minimum rate of pay for all ordinary hours of work and use this as the base for calculating overtime and penalty payments. The employer is effectively using their own higher base rate of pay instead of the minimum Award rate but it does not avoid the need to pay higher overtime or penalty rates and allowances.

Option B.

The employer can use the Award annualised wage arrangement.31 This enables an employer to pay a full-time employee (and note it only applies to full time employees) an annualised wage in satisfaction of any or all of the award provisions relating to minimum rates, allowances, overtime, shift penalty rates and annual leave loading (but only these Award requirements). An annualised wage must be no less than the amount the employee would have received under the Award for their work. A written agreement must specify:

  • the annualised wage payable
  • the applicable award provisions satisfied by payment of the annualised wage
  • the method of calculation of the annualised wage, including specification of each separate component of the annualised wage and any overtime or penalty assumptions used in the calculation; and
  • the outer limit number of ordinary hours which would normally attract a penalty rate payment and the outer limit number of overtime hours which the employee may be required to work in a pay period without any extra payment.

Other requirements

  • if an employee works more than the hours provided under the annualised wage arrangement in any pay period, then the employee will be entitled to separate payment in addition to the annualised wage
  • an annual comparison review with the award must be performed
  • detailed records of hours of work and breaks must be kept and signed off by the employee each pay cycle.

The Fair Work Ombudsman as published an example document for this arrangement – see https://www.fairwork.gov.au/newsroom/news/new-rules-for-annualised-wage-arrangements.

Option C.

An alternative is to rely on a common law “offset” clause in the contract of employment to pay an annual salary rate to an award covered employee. The Federal Court has held that employers may make contract arrangements to pay employees in accordance with a salary arrangement that compensates or “buys out” identified award entitlements without engaging with the annualised wage arrangements provision in the applicable award.32 However, care needs to be taken to ensure:

  • the contractual offset clause is precise about the Award entitlements being covered by the above award wage
  • the payment of an above award salary amount does not result in the employee being paid less than the Award requires for any particular pay period; and
  • that records of hours worked are still kept and regularly reviewed to ensure that the employee is in fact receiving as much or more than they would be entitled to receive under the Award.

Given the recent publicity surrounding large corporate underpayments, employers should consider their own particular circumstances in determining the best approach in order to ensure award compliance.

6. What are employers’ annual leave obligations?33

Full-time and part-time employees are entitled to 4 weeks paid annual leave for each year of service under the NES. The entitlement accrues progressively during each year, is cumulative and is paid out on termination. “Service” does not include periods of unpaid leave (eg unpaid personal leave, unpaid parental leave). Public holidays are not counted in any annual leave period nor is any period of personal leave. There is no requirement to work for a year before being able to take annual leave.

In addition to NES requirements, the Award requires that:

  • during a period of annual leave payment must be made for ordinary time wages plus a 17.5% loading34
  • whilst annual leave is to be taken at an agreed time, an employer may reasonably require an employee to take annual leave as part of a close down (for instance over the Christmas period) by giving at least 4 weeks notice35
  • annual leave may be taken in advance by agreement subject to written agreement. The employer is entitled to deduct an amount for annual leave which is taken but not accrued on termination of employment36
  • if an employee has accrued more than 8 weeks annual leave, an employer and employee can seek to reach agreement on reducing the annual leave balance. If there is no agreement either the employer or employee can require the taking of at least 1 weeks annual leave as long as at least 8 weeks notice is given37
  • annual leave of no more than 2 weeks in 12 months can be cashed out by written agreement as long as the employee’s annual leave balance does not go below 4 weeks.38

Are graduates entitled to paid study leave?

Law graduates are entitled to a maximum of 20 days a year paid study leave to attend courses and prepare for and attend examinations relating to practical legal training required for their admission to practise.39

What other types of leave are employees entitled to?

The NES set out requirements for other types of leave including personal/carers and compassionate leave, parental leave, community service leave and unpaid family and domestic violence leave.

7. Can employees make requests for flexible working arrangements?

The NES provide that certain types of employees can request a change in their working arrangements because of their circumstances (eg if the employee is the parent, or has responsibility for the care, of a child of school age or younger).

*Example - changed starting and finishing times, part time work and the working of more hours over fewer days.

Employers are required to give a written response to a request within 21 days. The employer can only refuse the request on reasonable business grounds.

The Award expands on these requirements:40

  • before responding to the request, the employer must discuss the request with the employee and genuinely try to reach agreement
  • if there is no agreement then, as part of any written response, the employer must set out any changes it can offer to better accommodate the employee’s circumstances41
  • whilst a decision to refuse a request is not directly challengeable, a dispute can be raised under the award dispute provision about whether the employer has discussed the request and responded to it as required by these provisions.42

Care should be exercised in responding to any employee request because legal action may also be available through other means such as discrimination laws. Employers should consider whether such arrangements should be time limited and/or subject to periodic review. 

8. Can an employee request an individual flexibility arrangement?

There is separate provision in the Award to allow agreement between an employer and any employee to vary certain award terms in order to meet both of their genuine needs.43 The terms that can be varied relate to arrangements for when work is performed, overtime and penalty rates, allowances and annual leave loading.

An individual flexibility arrangement (IFA) can only be made with an existing employee by agreement and must result in the employee being better off overall under the IFA. The award requires a written agreement detailing the Award terms to be varied, how they are to be varied, how the agreement results in the employee being better off overall and a start date. The agreement must be genuinely made without coercion or duress and can be terminated by either party on giving 13 weeks notice.

*Example – an employer can agree to an employee starting work one day a week before 7am so they can leave early to take their son to football training. The employer benefits by not having to pay a penalty rate for the early start and the employee benefits by being able to attend their child’s training.

An IFA should not be used as a quasi annualised wage or annual salary substitute. Any existing employee can request an individual flexibility arrangement whereas only certain types of employees have a legal right to make a request for flexible working arrangements.

9. Do you have to consult with employees about workplace changes?

The Award imposes requirements to consult with employees if there has been a definite decision to make major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees.44 This includes:

  • termination of employment by redundancy
  • major changes in the composition, operation or size of the employer’s workforce or required skills
  • loss or reduction of job or promotion opportunities or job tenure
  • alteration of hours of work
  • retraining or transfer to other work or locations
  • job restructuring.

In these situations, the employer must:

  • provide (in writing) to the employee/s concerned (and their representatives) all relevant information about the operational changes, including:
    • the nature of the proposed changes
    • the expected effects of the changes on employees, e.g. redundancy; and
    • any other matters likely to affect employees.
  • meet with the employee/s who will be affected to discuss:
    • the introduction of the changes
    • the effects the changes are likely to have on employees
    • measures to avert or mitigate the adverse effects of such changes on employees
  • consider any matters raised by employees about the changes. 

Consultation in similar terms is also required if an employer proposes to change an employee’s regular hours of work or roster.45  

10. How can workplace disputes be resolved?

It is best to seek to resolve any disputes at the workplace level whether by direct discussion with the employee involved or by private mediation. The award provides a formal dispute resolution avenue for any disputes about award matters or the National Employment Standards.46 It is important to note that not all matters can be addressed through this avenue, such as disputes about performance management issues, unless the parties agree. The first stage is that the employer and employee are required to try and resolve any dispute through succeeding levels internally in the workplace. 

The second stage is referral of the dispute to the Fair Work Commission if it cannot be resolved by internal discussions. The parties can agree on a process for the Commission to use such as mediation, conciliation and consent arbitration. Whilst these steps take place, work is to continue and an employee must not unreasonably fail to comply with employer directions about performing work. 

11. What are the award based employment termination notice/payment and redundancy requirements?

The basic notice and payment requirements in termination or redundancy situations are dealt with in the NES. The Award contains supplementary requirements.47

The Fair Work Act does not impose minimum notice requirements on employees who resign their employment. This requirement is usually addressed in a common law contract. However, award covered employees are required by the Award to give the same minimum period of notice of resignation as the employer (except that the employee does not have to give additional notice based on age). If the employee does not give the required minimum notice, an employer is authorised to deduct an amount of no more than one weeks pay from wages otherwise due to the employee. The deduction cannot be unreasonable in the circumstances.

If an employee is given notice of termination by an employer which they are required to work out (as opposed to payment in lieu), then the employee can take up to one day off a week (on a paid basis) to look for other work. This time off is to be taken at times convenient to the employee after consultation with the employer.

If an employee is required to work out a period of notice before their employment ends due to redundancy, then:

  • the employee can finish up during the redundancy notice period and they will still be entitled to their redundancy pay (but not payment for the period of notice not worked); and
  • the employee can take up to one day off a week (on a paid basis) to look for other work (subject to evidence requirements).

Some Other Mistakes

a) Not updating minimum wages in accordance with award increases

Minimum award wages are generally increased each year with effect from the first pay period after 1 July. Employers can subscribe to the Fair Work Commission’s award update service to find out about award changes and wage increases - https://www.fwc.gov.au/subscriptions.

b) Not keeping required time records and not giving correct pay slips

The Fair Work Act and Fair Work Regulations require employers to keep up to date and accurate records of the working hours and starting and finishing times of Award employees and provide pay slips. If this is not done and records cannot be produced or have not been kept properly, there are two likely consequences:

  • an employee’s version of hours and days worked is likely to be accepted over any employer response in the absence of documentary evidence; and
  • legal action may be taken against the employer for failing to keep records and pay Award entitlements to the employee and the employer may have a civil penalty imposed by a court.

Practical guidance about employer requirements can be obtained from the Fair Work Ombudsman website- https://www.fairwork.gov.au/tools-and-resources/fact-sheets/rights-and-obligations/record-keeping-pay-slips.

c) Not checking to ensure that any computerised payroll software correctly reflects award requirements

It’s important to check with your software provider to ensure that any payroll software can accurately deal with the requirements of the Award. Several major employers have discovered to their detriment that not all software packages have been customised to cater for particular award requirements.

d) Not ensuring there is a written employment agreement for each employee

The Award requires that employees be advised of their terms of engagement and in particular, their award classification and whether they are employed on a full-time, part-time or casual basis. This should at least take the form of a letter of engagement. However, there is a range of other matters not subject to or governed solely by Award or legislative regulation which employers should consider addressing in a contract of employment (such as an annualised salary and offset provision).

Resources

Employers can access a full version of the award at www.fwc.gov.au. The Fair Work Ombudsman also has valuable general guidance for employers about a range of issues including:

Checklist Summary

☐ Does the Legal Services Award 2020 cover your business?

☐ Does the Legal Services Award 2020 apply to your individual employees?

☐ Is the employee full time, part time or casual?

☐ Have you informed each employee of their terms of engagement, including their award classification and whether they are employed on a full-time, part-time or casual basis, at or before the time of their engagement?

☐ What will be the employee’s ordinary working hours and break entitlements?

☐ Are you paying at least the minimum required wages and allowances?

Are you paying at least the minimum wage rates?

Are you paying wages when required?

Are you required to pay allowances? 

Are you meeting superannuation requirements? 

Will the employee be required to work overtime or outside the span of ordinary hours? 

Can you give the employee time off in lieu of payment for overtime (TOIL)? 

Can you pay an “all up” rate of pay or annual salary? 

☐ What are employers’ annual leave obligations?

☐ Can employees make requests for flexible working arrangements?

☐ Can an employee request an individual flexibility arrangement?

☐ Do you have to consult with employees about workplace changes?

☐ How can disputes be resolved?

☐ What are your award based termination notice/payment and redundancy requirements?


Version 1 | 1 April 2022

Copyright 

This guide has been prepared for the Queensland Law Society and is protected by copyright law. Any person seeking to reproduce this material for a commercial purpose should contact QLS for specific permission. QLS logo is a trademark of QLS. QLS does not grant any licence or right to use, reproduce or adapt QLS logo without express permission of QLS.

Acknowledgement

This Guide has been prepared by Rob Stevenson, Principal, Australian Workplace Lawyers for use by Queensland solicitors.

Disclaimer

This guide is intended to be of practical assistance in understanding and complying with Award requirements. It is not a substitute for reading and understanding the Award and is not an exhaustive statement of employer Award obligations or obligations under the Fair Work Act 2009 or under employment law generally.  


PDF version here.

1 See Chapter 4 Fair Work Act. Penalties are currently up to $13,320 per breach for individuals and $66,600 for corporations or for serious contraventions up to $133,200 for individuals and $666,000 for corporations.

2 With a sentence currently of up to 10 years prison in Queensland - see ss.391(6)(a) and 398 Criminal Code 1899 (Qld).

3 Although for most practical purposes, long service leave is governed by state legislation – in Queensland, see Part 3, Division 9 of the Industrial Relations Act 2016 (Qld).

4 Clause 4 - Coverage.

5 Clause 2 – Definitions, clause 4 – Coverage, Schedule A – Classifications. 

6 Refer to Schedule A - Classifications.

7 Who will generally fall under one of the other Award classifications.

8 Clause 3 – The National Employment Standards and this award.

9 Part 2 – Types of Employment and Classifications.

10 Which cannot be less than 3 hours (clause 10.4).

11 See s.15A Fair Work Act. The issue of who is a casual employee has been the subject of much uncertainty in recent years. Currently, the Fair Work Act prescribes a technical approach to the definition of casual employment following the legalistic approach taken by the High Court in WorkPac v Rossato & Ors [2021] HCA 23 This is an area that may undergo further legislative amendment in coming years.

12 Employees who work for firms with less than 15 employees have a right to request conversion whilst there is a positive obligation on employers with 15 or more employees to consider whether conversation can be offered to employees – see Part 2-2, Division 4A of the Fair Work Act.

13 Part 3 – Hours of Work.

14 This is an extreme example and hours of work will usually be more consistent from week to week.

15 Note that a failure to observe this requirement means that the employee must be paid at time and a half (150% of their ordinary pay rate) until they have their meal break (clause 14.1) which must also be paid for.

16 Part 4 – Wages and allowances.

17 Clause 15.1.

18 Clause 15.

19 Clause 16.

20 Clause 18 and Schedule C – Summary of Monetary Allowances.

21 This would involve calculating the actual motor vehicle expenses and the percentage of business usage.

22 Clause 19.

23 Clause 19.4.

24 Part 5 – Overtime and penalty rates.

25 See s.62(2)&(3) Fair Work Act.

26 Clause 20.1.

27 Refer to Schedule B – Summary of Hourly Rates of Pay.

28 Clauses 20.4 and 20.6.

29 Clause 20.5.

30 Schedule E.

31 Clause 17.

32 Australia and New Zealand Banking Group Limited v Finance Sector Union of Australia [2001] FCA 1785; Linkhill Pty Ltd v Director, Office of the Fair Work Building Industry Inspectorate [2015] FCAFC 99; Annualised Wage Arrangements [2018] FWCFB 154 at [102].

33 Part 6 – Leave and Public Holidays.

34 Clauses 22.3 and 22.5.

35 Clause 22.7.

36 Clause 22.6.

37 Clauses 22.8, 22.9, 22.10.

38 Clause 22.11.

39 Clause 28.

40 Clause 6.2.

41 Clause 6.3.

42 Clause 31.

43 Clause 5.

44 Clause 29.

45 Clause 30.

46 Clause 31.

47 Part 8 – Termination of Employment and Redundancy.