The commencement of a new financial year is looming and the Fair Work Commission is about to hand down its decision on the outcome of the 2019 Annual Wage Review.
With the likely increase in award wages from 1 July 2019, it is an opportune time for you to review existing employment contracts. In most instances, employers in the automotive industry pay well in excess of award rates for qualified tradespersons and therefore have the ability to absorb the wage increase. Many employers also tend to review wages at this time of the year as their employees tend to expect a pay increase where any award increase is made.
While there is no legal obligation to flow-on the increase from the operative date if the employer has already paid sufficiently above award rates, members intending to review employee wage rates at some stage in the next two months are encouraged to consider a review oftheir existing employment arrangement and contracts.
Firstly, members need to ensure that the wage rates paid to employees are in fact higher than the new award rates that apply for the relevant position or award classification. Secondly, members should consider whether they wish to continue making payments for items such as annual leave loading, or certain award allowances including the tool allowance or a uniform allowance (if applicable). You need to be aware that you have the ability to include these and other payments in the over award wage rates paid. However, unless. To do this though you must include appropriate provisions in employment documentation or contracts, otherwise you will face the prospect of being exposed to underpayment of wage claims. Employers that operate on a simple verbal contract basis are even more exposed to these claims. It is critically important that members have the appropriate employment documentation is in place to protect against underpayment claims.
The Workplace Relations Department of the MTA can assist members in ensuring that they are protected against these and other claims through a Payroll & HR audit and also through the drafting of employment contracts, inclusive of ‘offsetting’ provisions. Members interested in discussing this further should contact the Workplace Relations team on 8291 2000 or via email by clicking here.
A reminder that there is an upcoming Payroll Training Session scheduled for Thursday 4 July 2019 at the MTA (81 Greenhill Road, Wayville), at which updated Wage Schedules will be provided to reflect the new wage rates. Participants will learn about their award obligations, including any mandatory documentation that may apply.
Employment contracts will also be discussed, including the operation of ‘offsetting provisions’ that will provide the necessary protection against underpayment claims. Members interested in attending this training session are encouraged to register their interest by clicking here to avoid any disappointment as places are filling quickly.