Pay and entitlement changes during coronavirus

To help manage the impact of COVID-19, there have been changes to some employees’ pay and leave entitlements.

Learn more about pay and leave during coronavirus on the Fair Work Ombudsman website.

For most employees, you can find their minimum pay rates and employment conditions in the relevant award or agreement.

An award sets out the minimum pay and conditions for a particular industry or occupation. While some employees aren’t covered by an award or agreement, all employees in Australia are entitled to:

  • a minimum wage
  • the 11 National Employment Standards (NES).

National Employment Standards

The National Employment Standards (NES) are 11 minimum employment entitlements that have to be provided to all employees.

The NES entitlements are:

  • maximum weekly hours
  • requests for flexible working arrangements
  • offers and requests to convert from casual to permanent employment
  • parental leave and related entitlements
  • annual leave
  • personal/carer's leave, compassionate leave and unpaid family and domestic violence leave
  • community service leave
  • long service leave
  • public holidays
  • notice of termination and redundancy pay
  • provision of Fair Work Information Statement and Casual Employment Information Statement.

Casual employees only get some NES entitlements, like unpaid carer's leave. They must be provided with a Casual Employment Information Statement and have a right to convert to permanent employment in some circumstances.

Do you live and work in WA?

Most WA sole traders and partnerships fall under the WA industrial relations system. The national system generally applies to incorporated businesses - those with a 'Pty Ltd' or 'Ltd' in their name.

If you're in the WA system:

Employee wages and entitlements

As an employer, you must pay your employees at the correct rate, as well as any entitlements they are eligible for.

The wages and entitlements your employee is eligible for can depend on:

  • age
  • industry
  • qualifications
  • work duties and responsibilities.

Minimum wage

The national minimum wage is $882.80 per week, for a 38 hour week, or $23.23 per hour.

The national minimum wage provides a starting point to calculate your employees’ wages, however most employees are covered by an award. Awards set minimum wages for employees based on the type of work they’re doing and the industry they’re in. Some employees have special minimum wages in an award, for example:

Employees who have reduced capacity for work due to disability may also receive a percentage of a full wage. Go to the Fair Work Ombudsman website to learn more about employees with disability pay rates.

Awards

Modern awards are industry or occupation based minimum employment standards which apply in addition to the NES. Look up the award(s) relevant to your business on the Fair Work Ombudsman website to check for things like minimum pay rates, hours of work, breaks, allowances, leave and super.

Enterprise agreements

Enterprise agreements set out conditions of employment for a group of employees at one or more workplaces. You can draft your own enterprise agreement so that it reflects your particular business. You also must have two or more employees to create an enterprise agreement.

Most enterprise agreements result in better work conditions for employees than the modern award. If you use an enterprise agreement, it will apply instead of a modern award. The pay rate in an enterprise agreement can't be less than the pay rate in the relevant modern award.

Pay secrecy

Your employees have the right to share, or ask other employees to share, information about their:

  • pay
  • employment terms and conditions to work out their pay, such as their work hours.

They also have the right to not share if they don't want to.

Find out more about Pay secrecy and when these rights apply on the Fair Work Ombudsman website.

Tax and superannuation

When you hire employees, you'll also have tax and superannuation obligations related to their pay and conditions. These include:

Leave

Annual leave

Annual leave also known as holiday pay, allows an employee to be paid while taking time off work. Full-time and part-time workers get 4 weeks of annual leave for every 12 months worked. Leave begins accumulating from the first day the employee works and they can take leave as soon as they accumulate it.

Parental leave

Eligible employees can get unpaid parental leave when:

  • an employee gives birth
  • an employee's spouse or de facto partner gives birth
  • an employee adopts a child under 16 years of age.

Employees are entitled to 12 months of unpaid parental leave. They can also request an additional 12 months of leave. Consider how you work with new parents to ensure that your business can maintain its operations during this time.

Sick and carer’s leave

Full-time and part-time employees can take paid sick or carer’s leave. Sick and carer's leave (also known as personal leave) allows an employee take time off to help them deal with:

  • personal illness or injury
  • caring responsibilities
  • family emergencies.

It’s important to know:

  • The yearly entitlement of paid sick or carer’s leave is based on an employee’s ordinary hours of work. It is 10 days for full-time employees, and pro-rata for part-time employees. This can be calculated as 1/26 of an employee’s ordinary hours of work in a year. . 
  • Casual employees or contractors do not get any paid sick or carer’s leave, but can access unpaid carer’s leave.
  • As an employer, you can ask an employee to give evidence to confirm why they have been away from work at any time. However, you might have a specific policy about when it is required. An employee’s medical certificate doesn't have to give exact details about the injury or illness.
  • An employee can take an extended period of unpaid sick leave. The Fair Work Ombudsman has more information on long periods of sick leave and unpaid carer's leave.

Family and domestic violence leave

Employees (including part-time and casual employees) can take family and domestic violence leave if they need to do something to deal with the impact of family and domestic violence and it’s not practical for them to do so during their work hours.

Employees are entitled to:

  • 10 days of paid leave for non-small businesses (employers with 15 or more employees on 1 February 2023)
  • 5 days of unpaid leave for small businesses (employers with 14 or less employees on 1 February 2023).

Employees of small businesses will be entitled to 10 days of paid family and domestic violence leave from 1 August 2023.

The leave is available upfront each 12 month period from the date the employee commences work. It will not accumulate from year to year if it’s not used.

Religious and cultural holidays

Religious and cultural holidays are days that people celebrate for religious and cultural reasons. You can use the calendar of cultural and religious days to help you identify the holidays your employees may celebrate.

If you don’t allow your employees to celebrate religious or cultural holidays, it can be discrimination. Make sure you allow your employees flexibility to celebrate these days – or celebrate them together through work events.

Allowances

Allowances provide employees with additional funds or products to ensure they can complete their job to the best of their abilities. If you fall under a modern award or an enterprise agreement, these documents will detail what allowances you’re required to pay.

Uniform allowances to employees

If you expressly require your employees to have a uniform to work with you, that is sufficiently distinctive to your organisation, often you provide your staff with a:

  • uniform allowance to purchase the uniform
  • uniform free of charge.

If your business has a uniform that you don’t require your employees to wear, you may offer certain incentives for your employees to wear your business uniform, such as a discount to purchase the uniform. If you do provide payments, reimbursements or offer discounts for non-compulsory uniforms to your employees, be aware that it may incur fringe benefits tax.

Legal obligations work-related items

You can’t make employees purchase work-related items from their wages. If you employ your staff under a modern award, each award has specific information on work related expenses.

Travel allowances to employees

A travel allowance is a payment to an employee to cover accommodation, food, drink or incidental expenses while they travel away from home or the office for work.

Awards and enterprise agreements often contain information regarding an employer’s obligations for travel requirements. However, you don’t have to employ your staff under an award or enterprise agreement to provide them with a travel allowance.

Tax and reporting obligations of travel allowances

Make sure you comply with your tax and reporting obligations. The ATO can help you identify what payments to record, report or pay tax on. It is your responsibility as an employer to do this for your employee.

Create an employment contract

It's a good idea to put your employee's pay and conditions in writing in an employment contract. Make sure the contract does not provide any conditions below your employee's minimum entitlements.

Workplace myths

From time to time, employers and employees have misunderstandings about their rights and obligations at work. To help you sort fact from fiction, we've compiled 6 common workplace myths.

Fact: If you employ full-time or permanent part-time employees, you cannot send them home without pay just because it’s quiet. If you employ casual staff, you can send them home as long as they have completed or are paid for the minimum number of hours as defined under their award or agreement.

Fact: All leave starts to accrue as soon as employees commence work.

Fact: Casual employees are entitled to some unpaid leave.

Fact: Redundancy is payable if the employee is terminated because the employer no longer needs their position to be done by anyone, or because of liquidation or bankruptcy.

Go to the Fair Work Ombudsman to learn more about redundancy pay and entitlements.

Fact: Employees who have been working for less than 12 months must get at least 1 week's written notice (unless they’re fired for serious misconduct).

Fact: There is no legal requirement that says you have to give 3 warnings. Despite there being no legal requirement, as an employer you may decide to give 3 warnings to employees as part of your internal policies and procedures.