The Fair Work Commission has recently handed down a decision which amends provisions in the General Retail Industry Award 2020 (‘the Retail Award’) from 1 July 2021 concerning overtime entitlements for part time employees.

In short, the changes will mean that part-time employees can agree to work additional hours over and above their agreed weekly hours and be paid ordinary rates of pay (rather than being paid overtime rates).

 

Who does the Retail Award apply to?

The Retail Award states that it applies to business involved in the following activities “the retail sale or hire of goods or services for personal, household or business consumption”. This means that as well as applying to shops it can also apply to businesses that sell products online or that provide services rather selling goods, such as travel agencies.

 

The change in detail

Like most awards, the Retail Award has provisions which require an employer and a part-time employee to agree in writing to a set pattern of work when the employee commences employment, including the number of hours they will work each week, the days the work will be performed and the start and finish times each day.

Previously there was uncertainty in the Retail Award as to whether a part time employee could agree to work in excess of these hours and be paid ordinary rates of pay or whether such work would attract overtime penalties.

The changes to the Retail Award clarify that such work can be paid at ordinary hourly rates so long as employees agree to work the additional time in writing before the end of the particular shift, and this agreement can be via email or text message.

Where an employee works additional hours but without such a written agreement, they will be entitled to overtime rates.

 

The new provisions in the Retail Award include the following:

10.5 At the time of engaging a part-time employee, the employer must agree in writing with the employee on a regular pattern of work that must include all of the following:

(a) the number of hours to be worked on each particular day of the week (the guaranteed hours);and

(b) the times at which the employee will start and finish work each particular day; and

(c) when meal breaks may be taken and their duration.,

 

NOTE: An agreement under clause 10.5 could be recorded in writing including through an exchange of emails, text messages or by other electronic means.

10.6 Changes to regular pattern of work by agreement

The employer and the employee may agree to vary the regular pattern of work agreed under clause 10.5 on a temporary or ongoing basis, with effect from a future date or time. Any such agreement must be recorded in writing:

(a) if the agreement is to vary the employee’s regular pattern of work for a particular rostered shift –before the end of the affected shift; and

(b) otherwise –before the variation takes effect.

 

NOTE 1:An agreement under clause 10.6 could be recorded in writing including through an exchange of emails, text messages or by other electronic means.

NOTE 2: An agreement under clause 10.6 cannot result in the employee working 38 or more ordinary hours per week.

 

EXAMPLE: Sonya’s guaranteed hours include 5 hours work on Mondays. During a busy Monday shift, Sonya’s employer sends Sonya a text message asking her to vary her guaranteed hours that day to work 2 extra hours at ordinary rates (including any penalty rates). Sonya is happy to agree and replies by text message confirming that she agrees. The variation is agreed before Sonya works the extra 2 hours. Sonya’s regular pattern of work has been temporarily varied under clause 10.6. She is not entitled to overtime rates for the additional 2 hours.

 

10.7 The employer must keep a copy of any agreement under clause 10.5,and any variation of it under clause 10.6 or 10.11,and,if requested by the employee, give another copy to the employee.

10.8 For any time worked in excess of their guaranteed hours agreed under clause 10.5 or as varied under clause 10.6 or clause 10.11,the part-time employee must be paid at the overtime rate specified in Table 10—Overtime rates.

10.9 The minimum daily engagement for a part-time employee is 3 consecutive hours.

 

Ancillary provisions in the Retail Award also provide that where an employee has regularly agreed to work additional hours over and above their guaranteed number of hours over the previous 12 months, the employee may request in writing that the employer increase their guaranteed hours on an ongoing basis to reflect the ordinary hours regularly being worked.

 

The usual rules regarding overtime still apply.

 

Nothing in the recent changes to the Retail Award alter the existing rules that part-time employees are entitled to overtime rates when they work in excess of 38 hours per week, over 9 hours a day (although one day at week an employee may work up to 11 hours a day) or outside the following span of hours:

DaysSpan of hours
Monday to Friday, inclusive7.00 am –9.00 pm
Saturday7.00 am –6.00 pm
Sunday9.00 am –6.00 pm

 

There are exceptions to these rules for employees who work in news agencies, video shops or where the trading hours of the establishment extend beyond 9.00 pm on a Monday to Friday or 6.00 pm on a Saturday or Sunday.

 

 

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Disclaimer

The information provided in these blog articles is general in nature and is not intended to substitute for professional advice. If you are unsure about how this information applies to your specific situation we recommend you contact Employment Innovations for advice.

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