Professional Employees Award Changes

Record keeping and overtime rules added to Professional Employees Award

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The Fair Work Commission has added new requirements for businesses that employ staff on the Professional Employees Award. The requirements come into effect on September 16 and it’s important that companies comply with the new rules.

Professional Employees Award Changes

There are number of key changes the award that you need to be aware of:

  1. The introduction of fixed penalty rate hours between After 10pm and before 6am Monday to Saturday:
    • 125% penalty rate;
    • Casual employees are entitled to a 25% loading on top of their typical pay;
  2. Sundays and public holidays now accrue a 150% penalty rate, all day.
  3. Employers must keep records of the time their employees work, including white-collar employees.
  4. Employees will be entitled to be paid overtime or receive time off in lieu of overtime for working in excess of 38 hours per week
  5. The changes don’t impact employees who have a salary higher than 25% of the award.

Why has the Award been changed, and who is affected?

In handing down its decision, the Fair Work Commission noted the Award had a lot of unclear rules that it was asked to make rulings on. The Commission argues that clarifying the rule will reduce the number of cases it hears on this issue and make it clear what’s required of employers of staff under the Professional Employees Award.

The Professional Employees Award [MA000065] mainly covers employees in the information technology, medical research, quality auditing or telecommunications services industries. However, employees are also covered if they perform professional engineering and scientific duties.

This is quite a broad coverage for an Award. For example, within information technology alone it covers

  • Designing and manufacturing computers, peripherals and software, and telecommunications equipment
  • Installing, repairing and maintaining computer systems
  • Computer consultancy services
  • Computer programming
  • System analysis services
  • Designing, developing and maintaining online internet architecture and facilitating online content management, or
  • Work associated with any of the above.

Importantly, many businesses that have staff covered under the Professional Employees Award often have salaried workers, rather than staff paid by the hour, so often don’t have time and attendance software.

Tanda’s three steps to staying compliant

You should always take a rigorous attitude toward compliance with workplace laws. The Fair Work Ombudsman has been ramping up audits and compliance programs over the last five years, and won’t hesitate to fine businesses that haven’t been complaint. With this in mind, there are three quick steps to get you started on complying with the new rules.

  1. Check which employees are covered

It might sound obvious, but you’d be surprised by how many employees are covered by the Professional Employees Award. The Fair Work Commission provides a summary of the Award’s coverage and the type of roles under its umbrella. You should read this summary and compare it with the roles performed by people in your organisation. If you find staff perform these roles, 

There is also a key exemption. Employees that earn over 25% higher than minimum award rates aren’t entitled to the additional penalty rates, in lieu of their additional pay. Many professional IT staff and others covered under the Award are often paid quite well and might be over the award rate. One way for you to cut out the admin required would be to simply pay all your staff over 25% of the minimum award rate.

  1. Use a digital time and attendance system to record hours and calculate overtime

It’s crucial to ensure your record-keeping systems are efficient enough to track hours worked by employees, including white collar employees. Calculating penalty rates manually is risky, and reliant on paper time and attendance. The best option is to use a digital time and attendance system. Employees clock in and out with a unique passcode, ensuring their exact working hours are recorded to the minute. 

This will immediately satisfy Fair Work’s requirement for you to record all hours worked by your staff. Recording time digitally also makes it far easier to find employee records and show a Fair Work Inspector that you’re compliant.

From here, if you’re using Tanda, the Award Interpreter can instantly calculate the employees pay and entitlements based off their hours worked. This includes a breakdown of ordinary hours and new penalty rate entitlements. From here, Tanda can export timesheets directly to our payroll system and pay your employees correctly. If your employees are salaried, Tanda can provide a simple reconciliation.

  1. Reconcile entitlements against the employees salary

If you have salaried employees, you’ll need to see if they need to be paid extra if they work overtime. This can get nuanced – if their salary is a bit more than the Award, they might be able to work a little bit of overtime before you need to pay them extra, for example.

Tanda’s Wage Compare feature allows you to instantly calculate what the employee is entitled to based off their hours worked and any penalty rates incurred, and compare it with their salary in that period. From here, it’s simple to calculate and order back payments to cover the entitlements.

Learn more about Tanda

If you have specific inquiries about how Tanda can handle the changes to the Professional Employees Award, you can book a demonstration of the software here. Tanda has been following the changes closely and has designed a bespoke solution to the changes that is straightforward for our customers to use.

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