In brief - The Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Bill (the Bill) facilitates simplified additional hours agreements for part time employees and extends the availability of JobKeeper related flexible work directions.

Scope of changes to modern awards

The proposed amendments to modern awards are limited to 12 modern awards covering those industries hit hardest economically by the COVID-19 pandemic. The awards are:

  • the Business Equipment Award 2020;

  • the Commercial Sales Award 2020;

  • the Fast Food Industry Award 2010;

  • the General Retail Industry Award 2020;

  • the Hospitality Industry (General) Award 2020;

  • the Meat Industry Award 2020;

  • the Nursery Award 2020;

  • the Pharmacy Industry Award 2020;

  • the Restaurant Industry Award 2020;

  • the Registered and Licensed Clubs Award 2010;

  • the Seafood Processing Award 2020;

  • the Vehicle Repair, Services and Retail Award 2020; and

  • such other awards as prescribed by the regulations from time to time (identified modern awards).

Simplified additional hours agreements

The Bill proposes to allow certain part-time employees to whom an identified modern award applies to enter into simplified additional hours agreements in which the employee agrees to work additional hours payable at their ordinary rate of pay (simplified additional hours agreement).

In order to enter into a simplified additional hours agreement, the employee's ordinary hours of work must already be at least 16 hours per week (as averaged, if applicable). Additional hours worked under a simplified additional hours agreement must be worked as part of a continuous period of three hours and must not be worked in contravention of any provision of the relevant modern award which limits the maximum number of consecutive days that may be worked.

Despite the agreement to work the additional hours at the employee's ordinary rate of pay, overtime will be payable:

  • if the employee works the additional hours outside a span or spread of hours specified in the relevant modern award as being the span or spread of ordinary hours of work;

  • if the additional hours result in the employee working more than 38 hours in a week, or such other number of hours specified by the relevant modern award as being the maximum number of hours a part time employee can work without being paid overtime.

Unless overtime is payable on the additional hours, the additional hours will count towards the employee's accrual of annual leave and paid personal/carer's leave, and for the payment of superannuation contributions.

A simplified additional hours agreement may be terminated by either party on seven days' written notice, or by agreement at any time. Disputes regarding the interaction of the provisions regulating simplified additional hours agreements, or regarding their operation, are to be resolved in accordance with the dispute resolution provisions in the relevant modern award.

The Bill also specifies that entering into or terminating a simplified additional hours agreement is a workplace right for the purposes of the general protections provisions in the Fair Work Act, and prohibits an employer from exerting undue influence or pressure on an employee in relation to a decision to enter into or terminate an agreement.

Flexible work directions

The Bill proposes that certain flexibilities afforded to employers under the Coronavirus Economic Response provisions (Part 6-4C) of the Act continue for a period of two years from the date of the Bill's commencement.
Specifically, the Bill contemplates that employers have the power to issue flexible work directions to employees, if an identified modern award applies.

A flexible work direction may involve a direction to perform:

  • any duties that are safe, within the employee's skill, competency and any relevant licence or qualifications, and reasonably within the scope of the employer's business operations (called a flexible work duties direction); and

  • duties at a place that is different from the employee's normal place of work, including the employee's home, provided the place is suitable, safe, reasonably within the scope of the employer's business operations and does not require the employee to travel an unreasonable distance (called a flexible work location direction).

As with the Jobkeeper enabling directions under the current Part 6-4C of the Act, a flexible work direction must be:

  • safe, having regard to (without limitation) the nature and spread of COVID-19;

  • reasonable in all of the circumstances;

  • a necessary part of a reasonable strategy to assist in the revival of the employer's enterprise;

  • in writing; and

  • the subject of consultation between the employer and employee.

The employer must also ensure that the employee's base rate of pay (worked out on an hourly basis) is not less than the greater of the base rate of pay that would have been applicable to the employee if the direction had not been given, and the base rate of pay applicable to the duties the employee is performing.

A flexible work direction will continue in effect until it is withdrawn or revoked by the employer, is replaced by a new flexible work direction or it is terminated by order of the Fair Work Commission. A flexible work direction will otherwise cease to have effect two years after the Bill commences.

We will continue to provide updates on the implications of the proposed changes as the Bill passes through Parliament. If you would like specific advice on the implications of the changes for your business, please contact us.

To find out more about the changes proposed by the Bill please click here.

This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2021.