The Fair Work Commission’s review of modern awards (Awards) has led to changes to some Awards affecting pay, and time limits on how long an employee can remain at an introductory/entry-level classification.
The changes apply from:
- 1 January 2025 for the following Awards:
- Airline Ground Staff Award
- Amusement Award
- Animal and Veterinary Services Award
- Australian Government Award
- Dry Cleaning and Laundry Award
- Fitness Award
- Food and Beverage Manufacturing Award
- Funeral Award
- Graphic Arts and Printing Award
- Joinery Award
- Live Performance Award
- Manufacturing Award
- Marine Tourism and Charter Vessels Award
- Meat Award
- Pest Control Award
- Port Authorities Award
- Textile, Clothing, Footwear and Associated Industries Award
- Timber Award
- Travelling Shows Award
- Vehicle Award
- 1 April 2025 for the Horticulture Award and Pastoral Award.
Time limits on introductory Award classifications
From 1 January 2025 (or 1 April 2025 for the Horticulture Award and Pastoral Award), introductory classifications in affected Awards can only apply to entry-level employees for a limited time.
Introductory classifications can be called different things depending on the Award, including ‘C14’ or ‘introductory’ or ‘Level 1’.
Introductory classifications apply to the first stage of a job. The first stage of a job includes:
- an initial induction period
- time spent undertaking training, or
- enough time to gain basic skills and experience required for the job.
The new maximum time limit for introductory level classifications varies between Awards but is never longer than 6 months.
For example, the Vehicle Repair, Services and Retail Award 2020 only allows employers to keep an employee classified as a “Level 1 R1 (entry)” at this entry-level classification for a maximum of 3 months before they are moved up to a “Level 2 R2” employee. This is less than the 6 month maximum so employers should check the specific Award that applies to their employees to find the correct maximum time limit.
As briefly mentioned above, the maximum time limit is not mandatory time limit on how long an employee should remain at the introductory classification. If an employee completes the competencies for the introductory classification, such as the induction, training and gained the basic experience and skills for the job, they can be moved up to the next classification before the maximum time limit arrives.
New rules and minimum pay for introductory rates
Due to the changes above to the time limit on introductory classifications, some employees may be entitled to an increase to their minimum pay rates under the affected Awards from the first full pay period on or after:
- 1 January 2025
- 1 April 2025 for employees under the Horticulture Award and Pastoral Award.
This is because you may be required to change the classification of some employees who have been employed at their Award introductory level for more than the maximum period on the effective date above.
If you have an affected introductory level employee who has exceeded the maximum time limit at their introductory classification, you should check what their new minimum pay rate is at the next classification level.
If there are any differences in pay that you need to pay the employee for the change in their minimum pay rate going back to the first pay period after 1 January 2025, and you should rectify and back-pay them as soon as possible.
New criminal underpayment laws under the Fair Work Act also came into effect on 1 January 2025 so you may find yourself criminally liable if you have, or continue to, willingly underpay affected employees.
Other enterprise and public sector Awards
The Fair Work Ombudsman has also published the following list of enterprise and public sector Awards that are affected by the above changes:
- Australia Post Enterprise Award
- Australian Capital Territory Public Sector Enterprise Award
- Christmas Island Administration Enterprise Award
- Metropolitan Newspapers (South Australia and Tasmania) Printing Award
- Northern Territory Public Sector Enterprise Award
- Note Printing Australia Award
- Nurses and Midwives (Victoria) State Reference Public Sector Award
- Printing Industry – Herald & Weekly Times – Production Award
- Victorian Local Government (Early Childhood Education Employees) Award
- Victorian State Government Agencies Award
Enterprise Agreements
Enterprise agreements (EAs) are based on Awards and ensuring employees covered by the EA are better off under the EA than the applicable Award. Given the new changes to entry level classifications and pay, employers may need to review and amend their EAs to ensure their employees at entry level are still better off overall under the EA compared to the varied Awards.
This means ensuring that employees who would be ordinarily classified under the entry level classification in the Award if not for the EA, are paid at least the new minimum rates and progressed to the next classification before the end of the new Award time limits. You will need to check how your EA classification corresponds to the Award classifications.
BlandsLaw can help you ensure that you are paying your employees the correct rates and complying with the relevant time limits in the Award or your EA. We can also assist with a review of how these changes will affect your EA and if you need to make any changes to comply with the “better off overall test”.
If you would like to discuss this or other workplace issues, please contact Andrew Bland or call 02 9412 3077.