BANKING, FINANCE & INSURANCE AWARD KNOWLEDGE BASE

Banking, Finance & Insurance Award 2020

In this article, we detail some of the key provisions in the Banking, Finance & Insurance Award including what sorts of businesses it covers, the different level of employee classifications under the Award and guidance on employee entitlements.

Employment Innovations advises a large number of organisations in this sector and has produced this Banking, Finance & Insurance  Award summary to help employers cut through the complexities of the award.

If you require any assistance in understanding your rights or obligations under the Award, please contact us.

 

Coverage

The Banking, Finance & Insurance Award 2020 applies to a wide range of businesses, not just banks, building societies and insurance companies.

 

The coverage clause in the Award is as follows:

Banking, finance and insurance industry means the industries of banking, lending, loaning, providing credit, investment, finance, superannuation, all forms of insurance, credit unions, building societies, financial intermediaries, trustee creditors and agencies, money market dealers, credit or charge card institutions, wool broking, agribusiness and services to the above industries such as broking, trading, debt recovery, financial consulting, valuation, money changing, data processing, transaction accounts, telephone enquiries and transaction processing.

 

The Award is designed to cover a wide range of employees who work in this industry – the employee classifications in Schedule A include roles as diverse as a cleaner, receptionist and financial planner.

Unlike many awards, the classifications extend quite high up the management chain and include roles such as branch manager and relationship manager. There is also coverage for many roles that in other industries may be considered “award-free” such as human resources officer/manager, information technology specialist and accountant.

We provide further guidance on classification levels later in this summary, the importance of the classification level is this dictates that minimum wage that the relevant employee must be paid. The Award just provides for minimum rates of pay, but does not prevent an employer from providing more beneficial terms. The Award is also silent on the payment of commissions and bonuses which are often paid to employees in this industry.

 

Download the Employment Innovations' Banking, Finance & Insurance Industry Award Summary

Types of Employees

Employees must be classified as either:

(a) Full-time;
(b) Part-time; or
(c) Casual.

 

Full-time employees;

Full-time employees are engaged to work an average of 38 ordinary hours per week. Hours worked in excess of this is paid as overtime.

 

Part-time employees;

Part-time employees work an average of less than 38 ordinary hours per week.

The Award says the employer must inform a part-time in writing at the start of their employment:

  • the number of ordinary hours of work they will be required to work per week; and
  • their starting and finishing times.

 

The Award does not specifically say that employees must work fixed days.

Any hours worked in excess of the employee’s stated number of weekly ordinary hours, or outside of their stated start and finish times must be paid as overtime.

 

Casual employees;

Casual employees generally work irregular hours.

Casual employees are entitled to a 25% loading on the minimum hourly rate set out in the Award. The casual loading is paid instead of annual leave, personal/carer’s leave, notice of termination and redundancy benefits.

The minimum engagement for casual employees is at least two consecutive hours of work on each occasion they are required to attend work. Casual employees can request that their employment is “converted” to permanent employment after 12 months of employment. This can only be refused on “reasonable” grounds.

Employers must provide casual employees with a copy of the clause of the Award dealing with casual conversion within the first 12 months of their employment (we recommend doing so at the commencement of their employment).

 

Ordinary Hours of Work & Rostering

The “span” of hours in which an employee may work their ordinary hours are:

  • between 7:00 am to 7:00 pm Monday to Friday;
  • between 8:00 am to 12:00 noon Saturday;
  • on not more than one night per week from Monday to Friday, which must be specified in advance by the employer, the span of ordinary hours may be worked up to 9.:00 pm (working such a shift does not mean the employee is a “shiftworker” – see further below).

 

Hours worked outside the span of hours must be paid as overtime.

The maximum number of ordinary hours that can be worked (exclusive of meal breaks) is an average of 38 hours per week. Hours can be averaged as follows:

(a) 38 hours within a work cycle of one week;
(b) 76 hours within a work cycle of 2 weeks;
(c) 114 hours within a work cycle of 3 weeks; or
(d) 152 hours within a work cycle of 4 weeks.

 

Hours worked in excess of this are to be paid as overtime.

 

Travel Arrangements for late Working

When an employee is asked to work beyond their normal scheduled finishing time and their usual means of transport home is either “unavailable, impracticable or unsafe” the employer must arrange suitable transport for the employee home.

Alternatively, an employee may, with the agreement of the employer, use their own motor vehicle in which case they must be reimbursed in accordance with the per km allowance set out in the Award which changes from time to time (see clause 18.4(b)).

Level 4 employees may also need to supervise lower-level employees in areas that are more complex or to lead a team.

Due to their higher level of experience, employees may be asked to provide specialist advice in their area of expertise. They have a sound knowledge of program and activity policies. Employees who are working alone or as “sole employees” will commence work at this classification level.

 

Breaks

 Employees must be provided with an unpaid meal break every 5 hours, except where the daily hours worked are 6 hours or less. Employees must be provided with unpaid meal breaks of no less than 30 minutes.

Where an employee works overtime (see further below). They must be allowed a 20 minute paid rest break once they have worked five hours since their last break.

Breaks during overtime may be extended by mutual agreement to a period not exceeding one hour, and any time taken over the 20 minute paid rest break will be unpaid.

 

Employment Innovations offers a complete employment solution for businesses in the Banking & Financial Services industry

Shiftwork

The Award provides for special rates of pay for “shiftwork”. This allows an employee to work their ordinary hours in the following patterns:

  • afternoon shift – meaning any shift finishing between 6:00 pm and midnight;
  • early morning shift – meaning any shift commencing between 4:00 am and 7:00 am;
  • night shift – meaning any shift finishing between midnight and 8:00 am.

 

Shiftwork penalty rates:

The following shiftwork penalty rates must be paid in relation to the working of shiftwork on Monday to Friday and on Saturday between 8:00 am and 12:00 noon:

 

% of the minimum hourly rate

Early morning shift

112.5%

Afternoon shift

120%

Night shift125%

 

Employees who permanently work afternoon or night shifts (or a combination of the two) must be paid an additional 5% loading.

 

Paid meal breaks for shiftworkers:

Shiftworkers are entitled to paid meal breaks of 20 minutes’ duration.

Employees must be provided with a meal break every 5 hours, except where the daily hours to be worked are 6 hours or less.

 

Transport for employees on shiftwork:

The Award states: “Arrangements for transport for employees finishing or commencing a shift between the hours of 8.00 pm to 6.00 am are to be satisfactorily established by the employer concerned, taking into account the requirements of the particular location, and having regard to any special circumstances.”

 

Payment of Wages

Employees must be paid either weekly or fortnightly, and can only be paid monthly where agreed with the employees. Where payment is made monthly it must be on the basis of 2 weeks in advance and 2 weeks in arrears.

 

Payment on Termination of Employment

Employees must be paid no later than 7 days after the date on which their employment terminates.

 

Annualised Salary/Wage Arrangments

The Award contains recently updated “annualised wage arrangements” provisions which allow an employer to pay a full-time employee an annual salary which is averaged over a 12 month period (so that an employee can be “underpaid” in one pay period, but “overpaid” in another pay period). The employee must, overall, be paid an amount that is at least equivalent to the minimum entitlements under the Award, or if there is a shortfall this must be made good within 14 days of the end of the 12 month period.

If an annual salary is paid in reliance on these provisions the employer must comply with a number of requirements including:

  • Notifying the employees how their salary has been calculated and what provisions of the award it is paid in satisfaction of;
  • Notifying employees of the “outer limit” of the number of overtime and penalty rate hours an employee may be required to work in a pay period, and if they work in excess of these then they will e paid at overtime/penalty rates at the relevant time (i.e. a “top-up” payment throughout the year);
  • Keeping a time-sheet of the start and finish times of each shift an employee works (and the start and finish times of any unpaid breaks) which must be approved by the employee each pay period;
  • Performing reconciliation of the amount paid to the employee in their salary compared to what they were entitled under the Award (annually or on termination of employment), and making good any shortfall within 14 days.

 

Although it is possible to pay an annual salary without relying on these provisions (i.e. via a clause in an employment contract), in this case, the employer must ensure the employee is paid sufficiently in each pay period, taking into account all entitlements that arise under the award. It is not possible just to ensure the employee is paid sufficiently over a year as a whole. In addition, employers should note that for all employees who are entitled to overtime or penalty rate payments under an award, there is an obligation under the Fair Work Regulations 2009 to keep a record of the number of such hours worked, even if the obligation to make those payments is met via paying a salary through a contract.

Where an employee earns over the “high-income threshold” (currently $153,600 per annum) it may be possible to avoid such obligations by entering into a “guarantee of annual earnings”, the effect of which will be that the award no longer applies to the employee. Alternatively, it may be possible to enter into an Individual Flexibility Arrangement (IFA) with an employee to alter certain obligations under the Award, so long as the employee is “better off overall”. We recommend that professional advice is sought in respect of such matters.

 

Allowances

The Award sets out a number of allowances employees can be entitled to, including:

  • First aid allowance;
  • Stand-by and call-back allowances;
  • Higher duties allowance;
  • Meal allowance (for where an employee is required to work at least 1.5 hours of overtime, and the overtime extends beyond 6:00 pm; an additional allowance must be paid is overtime exceeds 5.5 hours);
  • Travel expenses and motor vehicle allowance.

 

Employers should check clause 18 of the Award for the current rates of pay.

 

Overtime Rates

All work performed outside the ordinary hours set out above must be paid as overtime, as follows:

When Overtime Is Worked

Full-Time & Part-Time EmployeesCasual Employees

% of minimum hourly rate% of minimum hourly rate
Monday to Saturday; outside ordinary hours of work – first 3 hours

150%

175%
Monday to Saturday; outside ordinary hours of work – after 3 hours

200%

225%

Saturday; outside employee’s
weekly hours

200%

225%
Sunday

200%

225%

 

Time off Instead of Payment for Overtime

Instead of paying employees for working overtime, the Award allows for employees and employers to agree to an employee taking time off instead of being paid for the overtime.

The Award has strict rules regarding this including:

  • Each period of time off in lieu must be subject to a separate written agreement;
  • The period of time off that an employee is entitled to take is the same as the number of overtime hours worked, e.g. if an employee worked two hours of overtime, they are entitled to two hours’ time off work; 
  • Time off must be taken within the period of 6 months after the overtime is worked, or else the accrued time off in lieu must be paid out to the employee (at overtime rates);
  • Employees may request to be paid out their accrued time off in lieu at any time (to be paid at overtime rates);
  • Accrued time off in lieu is paid out on termination of employment (at overtime rates).

 

Rest Period After Working Overtime

Employees (other than casuals) must be given at least 10 consecutive hours off duty between the work of successive days.

Where they do not get a 10 hour rest period due to working excessive overtime:

  • the employee must be released from duty after that overtime is finished until the employee has had 10 consecutive hours off duty; and
  • there will be no loss of pay for ordinary hours of work time which occur during this absence.

 

Where an employee is required to recommences work without having had a 10 hour break then:

  • the employee must be paid at 200% of the minimum hourly rate until the employee is released from duty;
  • the employee is then entitled to be absent for 10 consecutive hours; and
  • there will be no loss of pay for ordinary hours of work time which occur during this absence.

 

Similar provisions apply to shiftworkers, although they are only required to be given an 8 hour rest period.

 

Download the Employment Innovations' Banking, Finance & Insurance Industry Award Summary

Annual Leave

Annual leave is provided for in the National Employment Standards, ie permanent employees get four weeks’ annual leave.

Shiftworkers who are regularly rostered to work on Sundays and public holidays in a business in which shifts are continuously rostered 24 hours a day for 7 days a week are entitled to five weeks’ annual leave.

 

Annual Leave Loading

Employees are entitled to be paid an annual leave loading whenever they take annual leave of the greater of:

  • 17.5% of their base rate of pay; or
  • the weekend penalty/shiftwork rates they would have earned during the period of annual leave.

 

Payment for such loading can be paid by way of an annual salary (see comments above).

 

Annual Leave in Advance

The Award provides for employees and employers to agree for annual leave to be taken in advance of it accruing and any annual leave owing to be deducted from an employee’s termination pay.

 

Close-Down

The Award allows for an employer to require an employee to take annual leave as part of a close down of its operations (e.g. a Christmas closedown), by giving at least 4 weeks’ notice. There is no ability for employers to require employees to take unpaid leave if they do not have sufficient annual leave accrued.

 

Excessive Leave Accruals

The Award permits employers to require employees with excessive annual leave accruals to take annual leave as directed. However, this is subject to strict rules including:

(a) An employer can only require an employee to take annual leave where that have accrued more than 8 weeks’ paid annual leave (or 10 weeks’ paid annual leave for a shiftworker);
(b) the employee cannot be required to take leave where it would mean they would have less than 6 weeks annual leave left;
(c) the employer must not require the employee to take any period of paid annual leave of less than one week;
(d) the employer must not require the employee to take a period of paid annual leave beginning less than 8 weeks, or more than 12 months after the direction is given.

 

Cashing Out of Annual Leave

Cashing out of annual leave is permitted by the Award so long as the rules in the Award are adhered to including:

(a) there is a written agreement between the employer and employee;
(b) the agreement must not result in the employee’s remaining accrued entitlement to paid annual leave being less than 4 weeks.

 

Personal/Carer’s Leave

Personal/carer’s leave is as provided for in the National Employment Standards (i.e. ten days paid leave for full-time employees, pro-rata for part-time employees).

Parental leave, compassionate leave, community service leave, family and domestic violence leave. All such leave is as is provided for in the National Employment Standards.

 

Long Service Leave

Long service leave (including for casual employees) is provided for in relevant State-based legislation.

 

Public Holidays

Public holiday entitlements are provided for in the National Employment Standards, i.e. that employees who would ordinarily work on a public holiday are entitled to be paid at their base rate of pay when absent.

An employer and employee may agree to substitute another day for a day that would otherwise be a public holiday under the National Employment Standards.

Where an employee is required to work on a public holiday or a substituted day they must be paid at 250% of the minimum hourly rate. The minimum engagement on a public holiday is 4 hours’ work.

 

Consultation & Dispute Resolution

The Award provides that employers must consult employees about major workplace change and changes to rosters or hours of work.

There are also provisions about resolving disputes concerning the Award, including the ability to apply to the Fair Work Commission.

 

Notice of Termination

The Award states that employers must give notice in accordance with the National Employment Standards when terminating the employment of permanent employees i.e.:

Employee’s period of continuous service with the employer at the end of the day the notice is given

Period of notice
Not more than 1 year

1 week

More than 1 year but not more than 3 years

2 weeks

More than 3 years but not more than 5 years

3 weeks

More than 5 years

4 weeks

 

An additional one weeks’ notice must be given where the employee has at least two years’ continuous service and is at least 45 years of age.

 The notice of termination required to be given by an employee is the same as that required of an employer except that the employee does not have to give additional notice based on the age of the employee.

 

Employees who do not give sufficient notice

If an employee who is at least 18 years old does not give the period of notice required under the Award, then the employer may deduct from wages due to the employee under this award an amount that is no more than one week’s wages for the employee.

 

Job search entitlement

Where an employer has given notice of termination to an employee, the employee must be allowed time off without loss of pay of up to one day for the purpose of seeking other employment.

 

Download the Employment Innovations' Banking, Finance & Insurance Industry Award Summary

Redundancy

Redundancy pay is provided for in the NES, ie where the employer has 15 or more employees, permanent employees are entitled to the following amount of redundancy pay:

 

The Award also contains provisions regarding:

  • transferring employees to lower paid duties when being made redundant;
  • giving employees the rights to end their employment period early if being made redundant;
  • having paid time off to look for a new job.

 

Classification Definitions

There are six employee classification levels within the Award. These dictate the minimum wage paid to the employee. Minimum wages are stated in clause 15 of the Award. There are reduced rates for employees 20 years or younger.

The six levels are described as follows:

 

Level 1;

A Level 1 position is one in which employees work within established routines, methods and procedures that are predictable and may require the exercise of limited discretion.

Typical activities and skills may include but are not limited to:

  • applying basic office procedures;
  • operating office equipment;
  • receiving, sorting, distributing and filing correspondence and documents;
  • performing basic manual or technical duties;
  • performing defined data entry/inquiry tasks; and/or
  • answering enquiries using general knowledge of the employer’s services.

 

Indicative job list: office trainee, filing clerk, mail sorting clerk, switchboard operator, assistant receptionist, messenger, yard hand, canteen worker, cleaner, deposit officer, scanning officer.

 

Level 2;

A Level 2 position performs tasks and service requirements given authority within defined limits and employer established guidelines, using a more extensive range of skills and knowledge at a level higher than in Level 1.

Level 2 employees are responsible for their own work which is performed within established routines, methods and procedures.

Typical activities and skills may include but are not limited to:

  • processing of standard documentation;
  • undertaking cashiering functions;
  • answering enquiries from members and external parties using detailed knowledge of specific business activities;
  • drafting correspondence appropriate to job function;
  • organising own work schedule; and/or
  • providing information/assistance to other staff members.

 

Indicative job list: telemarketer, sales and service trainee, data processing officer, teller/customer service representative with less than 12 months experience, entry-level claims officer.

 

Level 3;

A Level 3 position is one in which tasks and service requirements are performed using a more extensive range of skills and knowledge at a higher level than required in Level 2.

The position encompasses limited discretion in achieving task outcomes. A level of delegation and authority may be employed consistent with the job function and is performed predominantly within established policies and guidelines.

Those employed at this level are responsible and accountable for their own work and may be expected to provide direction to other staff.

Typical activities and skills may include but are not limited to:

  • the undertaking of projects;
  • preparing reports and recommendations within their own job function;
  • drafting of routine correspondence;
  • administering/maintaining staff records; and/or
  • delivery and/or co-ordination of learning and development activities.

 

Indicative job list: receptionist, loans processing officer, helpdesk operator, credit analyst, card services operator, contact centre officer, payroll clerk, teller or sales representative with at least 12 months’ experience, insurance clerk, case manager, account manager, technical officer, statistical clerk.

 

Level 4;

A Level 4 position is one in which tasks and service requirements are performed using a more extensive range of skills and knowledge at a level higher than required at Level 3. Those employed at this level are responsible for their own work and any employees under their control.

Positions at this level require the application of relevant specialist knowledge and experience. Those employed at this level are required to advise on a range of activities and contribute to the determination of objectives within the required area of expertise.

Typical activities and skills may include but are not limited to:

  • managing and maintaining service standards;
  • overseeing day-to-day operations of functional areas of responsibilities;
  • implementing and maintaining effective controls;
  • initiating disciplinary processes;
  • assisting with the recruitment and selection of staff; and/or
  • preparing of reports.

 

Indicative job list: human resource officer, learning and development officer, compliance officer, personal assistant, assistant accountant, accounts officer, claims officer, assistant underwriter, customer relationship manager, settlement officer, collections officer, lending officer, administrative officer, personal lending relationship officer, personal banker, customer service specialist agency officer, branch services officer, senior case manager, entry-level team leader, senior technical officer.

 

Level 5;

A Level 5 position is one in which tasks, service requirements and supervisory functions are performed using a more extensive range of skills and knowledge at a higher level than required at Level 4.

The position may be:

(a) a specialised role, possibly supported by one or 2 junior staff members, requiring formal qualifications and/or specialised vocational training; and/or
(b) a managerial role (managing 5–10 people) responsible for the operation of part or parts of the employer’s business.

 

Those employed at this level exercise considerable discretion and/or are responsible for operational planning.

Indicative job list: human resources consultant, senior learning and development officer, accountant, senior claims officer, analyst programmer, fraud investigator, call centre team leader, credit controller, administration manager, underwriter, sales manager, customer service team leader, assessor, loss control officer, business analyst, assistant branch manager, personal lending specialist, team leader.

 

Level 6;

A Level 6 position typically performs a middle managerial role primarily to control the conduct of a part of the employer’s business and in which decisions are regularly made and responsibility accepted on matters relating to the administration and conduct of the part of the business. Those responsible for managing more than 10 people must be classified at this level provided that this level 6 classification does not cover classes of employees:

(a) who, because of the nature or seniority of their role, were not traditionally covered at all by awards; or
(b) who perform work that is not of a similar nature to work that has previously been regulated at all by awards.

 

Indicative job list: branch manager, human resources or fraudulent relations manager, financial planner, information technology specialist, relationship manager, senior analyst, subject matter manager, divisional manager.

 

How Employment Innovations can help

If you require assistance with dealing with disciplinary issues concerning staff, Employment Innovations can help. Our HR Advisors will be able to guide you through each step of the disciplinary process and we have template documents (e.g. direction to attend a disciplinary meeting, written warning, letter of termination, etc) available as part of our subscription packages.

 

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Employment Innovations offers a complete employment solution for businesses in the Banking & Financial Services industry

 

About Employment Innovations

Employment Innovations is one of Australia’s leading providers of employment services designed to increase productivity and ensure compliance. Its services and solutions include all the tools that every Australian small to medium sized employer needs – including workplace advice, legal services, payroll solutions, migration, human resource management and HR software.

 

Disclaimer

The information provided in these knowledge base 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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