The Jargon-Free Guide to the Manufacturing Award (MA000010) Summary [2023]

The Manufacturing Award is a complex and ever-evolving Modern Award focused in several sectors and has a broad coverage in one of the country's biggest industries.

You can read also read our article that covers the 8 Conditions that manufacturing businesses didn't know existed in the Manufacturing and Associated Industries and Occupations Award. 

In addition, you can download a FREE copy of our Manufacturing Award eBook that covers everything you need to know about the award, without the jargon which comes with a BONUS payroll processing checklist. 

This summary provides will provide you a comprehensive understanding of everything you need to know about the Manufacturing Award to ensure you have maximum compliance.

Disclaimer:
Please note that every effort has been made to ensure that the information provided in this guide is accurate. You should note, however, that the information is intended as a guide only, providing an overview of general information available. This guide is not intended to be an exhaustive source of information and should not be seen to constitute legal or tax advice. You should, where necessary, seek a second professional opinion for any legal or tax issues raised in your business affairs.

This industry is quite large, covering a large range of areas, including:

• the manufacturing, making, assembly, processing, treatment, fabrication and preparation of:
  • The repair, refurbishment, reconditioning, maintenance, installation, testing and fault finding of floor coverings; as well as plant, equipment and buildings 
  •  
  • Mechanical and electrical engineering
  • Building supplies
  • Space tracking
  • Farriery (other than in the racing industry)
  • bottle merchants
  • Printing and processing of photographs from film
  • Handling, sorting, packing, despatching, distribution and transport in connection with any of the foregoing manufacturing industries or parts of industries.
  • Carriages, carts, wagons, trucks, motor cars, bodies, motorcycles, railway cars, tram cars, side-cars or other vehicles or parts or components or accessories in wood

• Maintenance employees in the engineering streams
• Technical workers
• Draughts persons
• Production planners
• Trainee engineers
• Trainee scientists
• Engine drivers

However, the Manufacturing Award (MA000010) does NOT cover:

1. Employees excluded from award coverage by the Act
2. Employees who are covered by a modern enterprise award or an enterprise instrument
3. Employees who are covered by a State reference public sector modern award or a State reference public sector transitional award

The manufacturing and associated industries and occupations do not mean:

1. Plumbers, unless employed in establishments covered by this award
2. The sugar industry, unless the work is carried out by contractors covered by this award
3. Security personnel
4. Gardeners
5. Cleaners, unless the cleaning work is incidental to the performance work covered by this award
6. Regarding locomotives, rolling stock, railway lines and components, work carried out by employees of a Rail Transport Operator or on-site in the building and construction industry
7. Regard to transmission cables, installation and maintenance work carried out in the power industry, telecommunications industry or on-site in the building and construction industry
8. Employees of electrical contractors
9. Employers or employees engaged in glass and glazing work

If an employer is covered by more than one award, they are covered by the award containing the classification that is most appropriate to the work that they perform.

This award also covers employers that provide group training services for apprentices and trainees engaged in the manufacturing and associated industries and occupations.

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• Full-time
• Part-time; or
• Casual

Full-time Employees

Employees that are not specifically a part-time or casual employee are for all purposes of this award a full-time employee unless otherwise specified in this award.

Part-time Employees

To be classified as a part-time employee, you must be engaged in fewer than 38 ordinary hours per week on a reasonably predictable schedule.

Part-time employees must engage in and be paid for a minimum of 4 consecutive hours per shift and may request an engagement for no less than 3 consecutive hours per day or shift.

Before your employees commence part-time employment the hours to be worked and the days on which they will be worked must be agreed on in writing, and a copy must be retained by the employer.

If your employee is required to work more than the agreed upon hours, they must be paid overtime rates.

Public holidays

When part-time employees’ normal paid hours fall on a public holiday, the employee must not lose pay for the day even if they do not work.

When part-time employees work on public holidays, they must be paid in accordance with the public holiday pay rates outlined in this award.

Casual Employees

If an employee has no guaranteed hours of work or works irregular hours, then they are considered to be a casual worker.

Due to a lack of annual leave and personal/carer’s leave, sick leave, redundancy benefits and the other entitlements that full- and part-time employees receive, casual workers are paid an additional 25% loading on top of their base rate of pay.

When a casual employee is required to work, the employee must be paid for a minimum of 4 consecutive hours of work.

Right to Request Casual Conversion

A regular casual employee is someone who is employed on a regular basis for a period of at least 6 months.

A regular casual employee can request in writing to have their employment converted to part-time or full-time employment depending on their regular hours.

Employers must give their employees notice in writing within 4 weeks of the employee becoming a regular casual employee. If the employee does not elect to convert their contract of employment within 4 weeks, they are considered to have declined.

Once an agreement is reached, the employee and employer must agree upon:

• Whether the employee is converting to part- or full-time employment
• Employee conditions depending on the agreed-upon employment type

The conversion will take effect from the start of the next pay cycle once an agreement has been reached unless otherwise agreed.

Once a casual employee has converted to full-time or part-time employment, they only revert to casual employment with the written agreement of the employer.

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Apprentices

Employers can employ apprentices in accordance with laws that regulate apprentices. This award applies to apprentices in the same way that it applies to a full-time employee unless explicitly stated.

Employers must not require apprentices to work overtime or shift work if it prevents their attendance at training in accordance with their training agreement, except in an emergency.

Apprenticeships under this award are competency-based with the nominal period being 4 years. The actual time taken to complete an apprenticeship will vary depending on the intensity of training, the variety of work experience and licensing requirements.

Apprentice Conditions of Employment

Apprentices are entitled to be released from work without loss of employment and payment of appropriate wages to attend any training and assessment associated with the training contract.

Time spent by an apprentice attending training and assessments is regarded as time worked for the employer for payment purposes.

The notice of termination provisions of the National Employment Standards (NES) applies to apprentices. However, the redundancy provisions of the NES do not apply to apprentices.

Payment of Fees and Textbooks

Costs associated with prescribed courses and textbooks incurred by an employee must be reimbursed to the apprentice within 6 months from the commencement of the apprenticeship or the relevant stage of the apprenticeship or within 3 months of the apprentice commencing training with the Registered Training Organisation (RTO).

Travel Payment for Block Release Training

If an apprentice is attending training that requires an overnight stay, the employer must pay reasonable travel costs for travelling to and from the training. However, the employer is not obligated to pay if the apprentice could have attended training at a close venue and attending the more distant training had not been agreed on.

Reasonable travel costs include:

• the total cost of reasonable transportation (including transportation of tools, where required) to and from the training; and
• accommodation costs; 
• reasonable expenses such as meals that are beyond the travel costs to and from work
• reasonable costs do not include payment for travelling time or expenses incurred while not travelling to and from the block release training; and
• an employer may reduce the amount paid to an apprentice if they are receiving a Government apprentice assistance scheme

Apprentices must not work more hours than the relevant tradesperson.

Apprentices under the age of 18 years are not required to work overtime or shiftwork unless the apprentice desires to do so.

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Extension of Nominal Term

The nominal period of an apprenticeship is extended by a day for each day the apprentice is absent during each year of the apprenticeship, except for annual or long service leave.

Paid personal/carer’s leave of ten or less days does not extend the nominal period of the apprenticeship.

Competency-Based Progression

Competency-based wage progression means an apprentice will be paid at the relevant wage rate for the next stage of their apprenticeship if:

• Competency has been achieved in the relevant proportion of the total competency points for that stage of the apprenticeship
• Requirements of the relevant State/Territory authority are met; and
• Either:
• The RTO, employer and apprentice agree that requirements have been met
• The employer has been provided with written advice that the RTO has assessed that the apprentice meets requirements in respect to all the relevant units of competency and the employer has not advised the RTO and the apprentice of any disagreement with that assessment within 21 days of receipt of the advice.

School-Based Apprentices

A school-based apprentice is a person undertaking an apprenticeship while also undertaking a course of secondary education.

School-based apprenticeships may be undertaken in the trades covered by this award under a training contract declared or recognised by the relevant State or Territory authority.

If the apprentice is a full-time school student, they must be paid 25% of their actual hours worked each week on-the-job for any time spent in off-the-job training. 

For example, if they worked 10 hours in on-the-job, they must be paid for 2.5 hours in off-the-job training

Cadets

A cadet is a person without prior experience in the Manufacturing and Associated Industries and Occupations or other relevant experience.

Cadets must achieve 50% of the modules required for the qualification as a full-time or part-time student before commencing employment

Technology Cadets

The Technology Cadetship consists of 4 stages and a technology cadet can enter at each stage as long as they meet the entry requirements for each stage. Once they’ve met any on-the-job training, off-the-job training and assessment requirements, then they’re considered to have completed each relevant stage of the Cadetship. 

The entry and progression requirements and the maximum duration for each stage of the Technology Cadetship are below:

• Over a Technology Cadetship, the cadet will spend an average of at least 20% of their time in approved training.
• Just like apprentices, a Technology Cadet will need to work an extra day for each day they’re absent unless it’s for annual leave, long service leave, paid bereavement leave and public holidays. If they’ve worked overtime, this must be credited when you calculate the extra time they need to work. They also can’t commence the next stage or be paid next year’s wage rate until they’ve worked the additional days.
• They can work reasonable overtime as long as it doesn’t affect the completion of their training, but they can’t be working on their own.
• They cannot work shiftwork unless it satisfies requirements in their training.
• They are subject to a satisfactory probation period of up to 3 months and can be reduced by the employer.
• Technology Cadets who either fail to complete their cadetship or can’t be placed in full-time employment with their employer when they complete their cadetship aren’t entitled to termination or redundancy pay unless they were employed before becoming a Technology Cadet.
• They are allowed to be absent from work without losing employment and/or wages to attend approved training.

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Trainees

A trainee must be allowed no more than an average of 8 hours per week during a school term to attend class relating to their appropriate certificate course.

Trainee engineers or trainee scientists must have a course of study be agreed on by the employer and trainee. The maximum attendance should not exceed 3 nights each week of 2 hours’ lecture or 3 hours’ practical work. 

Trainees are not obliged to work overtime if it interferes with studies. They are also not to be employed to do shiftwork, except at their own request during academic vacations.

Unapprenticed Juniors

This award applies to unapprenticed juniors except where otherwise stated.

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The NES states that employers cannot request that their full-time employees work more than 38 hours per week

Change to Spread of Hours

On 16 June 2021, the FWC handed down a decision clarifying how the spread of hours can be changed. Employers and employees can make an agreement to change the ordinary spread of hours under the Manufacturing Award in a few different ways. This includes when an employer makes an agreement with:

• an individual employee
• the majority of employees in a discrete section of the workplace, or
• the majority of employees in the workplace.

The parties can agree to change the spread of hours by shifting them back or forward by up to an hour.

For example, 5 am to 5 pm or 7 am to 7 pm Monday to Friday.

Day Workers

For day workers, the ordinary hours of work are an average of 38 per week without exceeding 152 hours in 28 days.

The ordinary hours for day workers can not exceed 8 per day unless agreed and worked between Monday to Friday. However, ordinary hours can include Saturday and Sunday as long as it’s agreed between the employer and the majority of employees or with an individual employee.

Any work that is performed outside of 6am to 6pm must be paid for at overtime rates but can be slightly altered by up to one hour on either side by agreement. 

When an agreement is reached, the rates to be paid to a day worker for ordinary time worked are:

Continuous Shiftworkers

Continuous shiftwork is when there is work being carried out 24 hours a day for 6 consecutive days without interruption (except for breakdowns or meal breaks).

The ordinary hours of continuous shiftworkers must average 38 hours per week, including meal breaks and can not exceed 152 hours in 28 consecutive days.

Continuous shiftworkers are entitled to a 20 minute meal break on every shift, which must be counted as time worked.

The ordinary hours for continuous shiftworkers will not exceed 8 per shift unless agreed on.

Except at regular changeover of shifts, your employees must not be required to work more than one shift in every 24 hours.

Non-Continuous Shift Workers

The ordinary hours of work for non-continuous shift workers are an average of 38 per week and must not exceed 152 hours in 28 consecutive days and will not exceed 8 per shift unless otherwise agreed on.

The ordinary hours for continuous shift workers will not exceed 8 per shift unless agreed on.

Except at regular changeover of shifts, your employees must not be required to work more than one shift in every 24 hours.

Twelve Hour Days or Shifts

When there is an agreement between the majority of employees and an employer, 12 hour shifts or days can be introduced subject to:

• Proper health monitoring procedures being introduced
• Suitable roster arrangements being made
• Proper supervision being provided
• Adequate breaks being provided
• A trial or review process being jointly implemented by the employer and the employees or their representatives.

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Daylight Saving

If your employee's work shift spreads across the start or finish of daylight savings, they will be paid according to adjusted time.

This means the time on the clock at the beginning of work and the time on the clock at the end of work. 

For example, if daylight savings time was adjusted at 3am to become 2am, and the employee worked from 11pm to 7am, then they would be paid 9 hours.

Make-up Time

Employees can choose to work make up time for time off during ordinary hours by working those hours at a later time.

Shiftwork employees can also do the same and be paid at the rate that they had taken time off, not the make up time. 

For example, a shiftwork employee who makes up time on an overnight shift on Friday for their day shift on Tuesday should be paid ordinary rates rather than the 150% penalty rate. 

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• Facilities are limited to the extent that meal breaks need to be staggered, and as a result, it is not practicable for all employees to take a meal break within 5 hours, an employee must not be required to work for more than 6 hours without a meal break.
• There is an agreement between an employer and an employee where employees may be required to work in excess of 5 hours but not more than 6 hours without a meal break.

Paid Meal Breaks - Continuous Shift Workers

Continuous shift workers are entitled to a 20 minute paid meal break.

Paid Breaks

Employees that work in technical fields of work, technical workers, tracers and draughts persons, production planners, trainee engineers and trainee scientists must be allowed a paid 10 minute morning tea rest period at a time fixed by the employer.

Timing of Taking Breaks

Scheduled meal or rest breaks can be altered by employers if it is necessary for the continuity of operations.

Employers may stagger the time of taking meal and rest breaks to meet operational requirements.

Working Through Meal Breaks

Except where there is an alternative arrangement, employees must be paid as follows for work done during meal hours and until a meal break is taken:

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• The time of trial duty commences at the time the employee is instructed to be on board and terminates when the employee gains contact with the shore.
• The maximum number of continuous hours the employee is required to be on duty is 12 hours.

Meal breaks must be no less than 30 minutes unless agreed upon. Lunch must be provided between 12 and 2.00 pm. 

If the employee is required to be on board before 7am, breakfast must be provided, and if the trial continues after 6pm, a light dinner must be provided. 

Employees must be paid 25% extra for time on duty while the vessel is at the wharf and 50% extra for time on duty while the vessel is in a harbour or at sea.

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For more information on the industry pay conditions, please refer to the Pay Guide for the manufacturing and associated industries and occupations award here.

Please note, you can also refer to the minimum rates for different classifications here.

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Employers must ensure that a salary staff's annual wage can't be less than what they would've been paid over the year if they were paid all the award entitlements for their job.

If you have salary staff covered by the Clerks Private Sector Award, check out our Ultimate Guide on Annualised Salary Changes.

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All Purpose Allowances

These allowances are included in the rate of pay for an employee if they’re entitled to the allowance, even when calculating any penalty rates, loadings or they’re on annual leave.

• Leading hand allowance - to be paid if your employee is required to be a leading hand
• Ship repairing allowance - to be paid if your employee is required to engage in ship repairs
• Tool allowance (tradespersons) - to be paid if your trades employee is required to provide their own tools
• Tool allowance (carpenter, joiner or shipwright/boatbuilder) - to be paid if your carpenter, joiner or shipwright/boatbuilder employee is required to provide their own tools
• Technical computing equipment allowance - to be paid if your employee is required to use technical computing equipment to perform work of a complex nature
• Supervisor/Trainer/Coordinator—Technical allowance - to be paid if your employee works in the technical field, they must be paid 107% of their minimum rate based on their employee’s technical classification
• Artificial fertilisers and chemicals allowance - to be paid if your employee is responsible for working with artificial fertilisers, chemicals, alkalis and all processes involving chemical synthesis
  

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Other Allowances

• Vehicle allowance - to be paid if your employee uses their own vehicle for business purposes
• First aid allowance - to be paid if your employee holds first aid qualifications and is expected to perform first aid duty on shift
• Meal allowance (overtime) - to be paid if your employee is given short notice (refer to link) that they’re expected to work overtime and haven't been provided a meal
• Damage to clothing, spectacles, hearing aids and tools allowance - to be paid if your employees’ items are damaged or destroyed by fire or corrosive substances
• Case hardened prescription lenses allowance - An employer must pay for the cost of case hardening of an employee’s prescription lenses
• Protective clothing and equipment allowance - Employers must reimburse the cost of purchasing protective clothing and equipment
• Engine driver and fireperson allowance - If you have boiler attendants, engine drivers or firepersons as your employees, the following allowances must be paid if they perform these tasks:
• Attending to refrigeration compressors
• Attending to an electric generator or dynamic exceeding 10kW capacity
• Being in charge of plant
• Attending to a switchboard where the generating capacity is 350kW or over
• Cleaner, greaser or oiler allowance - to be paid if you have cleaner, greaser or oiler employees who sometimes works under the supervision of an engine driver stops or starts an engine
• Manganese dioxide and other pigments allowance - to be paid if your employee handles manganese dioxide and other pigments:
• For the first 2 hours
• More than 2 hours

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Special Rates

These allowances must be paid to employees including apprentices and juniors. If your employee is eligible for more than one rate, the employer must pay only the highest rate and are not subject to premium or penalty additions:

• Cold places allowance - to be paid if your employee works more than 1 hour in places where the temperature is below 9 degrees celsius artificially
• Hot places allowance - to be paid if your employee works more than 1 hour in places where the temperature is raised artificially:
  • Between 46°C and 54°C
  • In excess of 54°C
• Wet clothing or boots allowance - to be paid if your employee’s clothing or boots are saturated by water, oil or another substance
• Confined spaces - to be paid if your employee works in a confined space
• Dirty work allowance - to be paid if your employee and their supervisor agree that the work is unusually dirty or is of offensive nature:
  • Not Ship Repair Work
  • Ship Repair Work
• Height money allowance - to be paid if your employee works in construction, erection, repair and/or maintenance at heights of 15 metres or more. This does not apply to linespersons, linesperson assistants, riggers and splicers
• Meat digesters and oil tanks allowance - to be paid if your employee works on repairs in oil tanks or meat digesters for:
  • Less than half a day
  • More than half a day
• Sanitary works allowance - to be paid if your employee works in a sanitary works
• Insulation materials allowance - to be paid if your employee handles loose slag wool, loose insulwool or other loose material used for providing insulation
• Slaughtering yards allowance - to be paid if your employee works in slaughtering yards
• Boiler repairs allowance - to be paid if your employee works with boiler repairs:
  • Smoke-boxes, fire-boxes, furnaces or flues of boilers
  • Working inside a boiler to repair oil fired boilers, including the castings, uptakes and funnels or flues and smoke stacks
• Underground mine work allowance - to be paid if your employee is an electrician working underground in a mine
• Explosive powered tools allowance - to be paid if an employee uses explosive powered tools
• Ships in dock allowance - to be paid if an employee works under a ship in a dock or slipway
• Foundry allowance - to be paid if your employee works in a foundry
• Boiling down works allowance - To be paid if your employee works in boiling down works
• Lead works allowance - to be paid if your employee works in lead works
• Carbon black handling allowance - to be paid if your employee handles carbon black, depending on if:
  • 2 sets of overalls are not provided each year
  • 2 sets of overalls are provided each year
• Installing or repairing belting underground in mines allowance - to be paid if your employee is required to install or repair any type of belting underground in mines
• Processing free coal dust allowance - to be paid if your employee processes free coal dust
• Boiler cleaning - engine driver allowance - to be paid if your engine driver is cleaning or scraping inside gas or water spaces of any boilers, flues or economisers
• Second-hand work allowance - to be paid if your employee works on second-hand upholstering, bedding, floor covering and/or soft furnishings
• Foreign rock allowance - to be paid if your employee performs work with the following types of rocks:
  
  • Rock phosphate, superphosphate and mixed manure sections receiving ex ship or railway truck
  • Handling rock phosphate to crushers and all other employees in the rock phosphate section
  • Mixing superphosphate
  • Excavating bins, and the manufacture or excavating of superphosphate until such time as it is dumped on the heap for curing
  • The handling of superphosphate from the heap until loading in wagons or trucks for despatch, including the manufacture and despatch of mixed fertilisers

• Farmers’ own bags - to be paid if your employee works with fertilisers, chemicals, alkalis and other chemical synthesis:
• Sorting, branding, bagging, dumping, sewing or trucking, fertilizing materials in farmers’ own bags
• Loading double-handling into railway or other trucks, fertilising materials in farmers’ own bags
• Loading single-handling into railway or other trucks, fertilising materials in farmers’ own bags
• Soda ash allowance - to be paid if your employee carries and stacks bagged soda ash
• Raw materials allowance - to be paid if your employee carries and stacks bagged (other than soda ash)
• Skimming and floater setting allowance - flat gas tank allowance - to be paid if your employee skims the drawing pit 
• Glass furnace regenerators allowance - to be paid if your employee works on building, rebuilding or packing glass furnace regenerators
• Float glass furnace repair allowance - to be paid if your employee removes molten tin from the float glass bath while the float glass furnace is being repaired
• Jack bolt tensioner allowance - To be paid if your employee adjusts the tensioner of jack bolts while a furnace is under heat
• Loading and unloading away from the employer’s premises - to be paid if your employee loads and unloads operations at wharves or railway yards elsewhere than on the employer’s premises

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Transfers, Travelling & Working Away From Usual Place of Work

• Excess travelling time - to be paid if your employee is working away from their usual place of work:
  • Monday to Sunday allowance
  • Sunday and Public Holiday allowance
• Change of residence for a transfer allowance - to be paid if your employee is being transferred involving a change of residence:
  • Travelling Time (Monday To Saturday) Allowance - Sleeping Berth Not Provided - In Process Of Buying A Place Of Residence
  • Travelling Time (Monday To Saturday) Allowance - Sleeping Berth Not Provided - Not In Process Of Buying A Place Of Residence
  • Travelling Time (Monday To Saturday) Allowance - Sleeping Berth Provided - In Process Of Buying A Place Of Residence
  • Travelling Time (Monday To Saturday) Allowance - Sleeping Berth Provided - Not In Process Of Buying A Place Of Residence
  • Travelling Time (Sunday And Public Holidays) Allowance - Sleeping Berth Not Provided - In Process Of Buying A Place Of Residence
  • Travelling Time (Sunday And Public Holidays) Allowance - Sleeping Berth Not Provided - Not In Process Of Buying A Place Of Residence
  • Travelling Time (Sunday And Public Holidays) Allowance - Sleeping Berth Provided - In Process Of Buying A Place Of Residence
  • Travelling Time (Sunday And Public Holidays) Allowance - Sleeping Berth Provided - Not In Process Of Buying A Place Of Residence

• Distant work allowance - to be paid if your employee is required to temporarily work away from their usual home and needing to travel further away:
  
  • Monday To Saturday Allowance - Sleeping Berth Not Provided
  • Monday To Saturday Allowance - Sleeping Berth Provided
  • Sunday And Public Holidays Allowance - Sleeping Berth Not Provided
  • Sunday And Public Holidays Allowance - Sleeping Berth Provided

Training Costs

• Training costs for fees and textbooks reimbursement (not apprenticeship training) allowance - any costs your employees incur as a result of training agreed to by the employer must be reimbursed.

Search our database for all relevant allowances to your modern award.

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As of 1 July 2022, however, employers are required to pay a super guarantee on behalf of eligible employees, regardless of how much they are paid.

A rate of 10.5% of an employee’s ordinary earnings must be contributed.

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For part-time employees, overtime work is any work that is performed in excess of their agreed hours of work.

Payment for Overtime - Other than Continuous Shift Workers

Employees will be paid the following rates for overtime worked:

• 150% of the ordinary hourly rate for the first 3 hours and
• 200% of the ordinary hourly rate after that.

For example, if an employee works 5 hours of overtime, they will be paid 150% of their ordinary hourly rate for 3 hours and 200% for 2 hours.

Unrelieved Shift Work on Rostered Day Off

If a shift worker is required to work on their rostered day off, they must be paid 200% of the ordinary hourly rate for all hours worked on their rostered day off.

Payment for Overtime - Continuous Shift Workers

A continuous shift worker working overtime must be paid 200% of the ordinary hourly rate.

Saturday Work - Day Worker

Minimum payment of 4 hours.

For example, if an employee works 8 hours on a Saturday, they will be paid 150% of their ordinary hourly rate for 3 hours and 200% for the remaining 5 hours. 

Sunday Work

An employee that is required to work overtime on a Sunday must be paid 200% of the ordinary hourly rate with a minimum payment of 3 hours.

Public Holiday Work

The following rates apply to workers on public holidays:

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Time Off Instead of Payment for Overtime

Employees and employers can agree in writing to the employee taking time off instead of being paid for a particular amount of overtime that has been worked by the employee.

Any amount of overtime that has been worked by an employee that is taken as time off instead of payment must be the subject of a separate agreement.

The agreement must state each of the following:

1. The number of overtime hours that it applies to and when those hours were worked
2. That the employer and employee agree that the employee may take time off instead of being paid for the overtime
3. If requested at any time, the employer must pay the employee for overtime covered by the agreement but not taken as time off
4. Any payment must be made in the next pay period following the request.
5. The time off that an employee is entitled to be the same as the number of overtime hours worked
6. Time off must be taken:
1. Within 6 months after the overtime is worked
2. At a time within that period of 6 months agreed by the employee and employer
3. If the employee requests at any time to be paid for overtime, the employer must pay the employee for the overtime in the next pay period.
7. Employers must keep a copy of any agreement
8. Employers must not exert undue influence or pressure on an employee in relation to a decision by the employee
9. If on the termination of the employee’s employment, time off for overtime worked by the employee must be paid to the employee

Reasonable Overtime

An employer can require an employee to work reasonable overtime hours at the appropriate overtime rates. However, an employee can refuse to work overtime hours if they are unreasonable.

When determining whether overtime hours are reasonable, the following is to be taken into account:

1. Any risk to employee health and safety from working the additional hours
2. The employee's personal circumstances, including family responsibilities
3. The needs of the workplace
4. Whether the employee is entitled to receive overtime payments, penalty rates or other compensation for working additional hours
5. Notice is given by the employer when requesting the additional hours
6. Notice is given by the employee of refusal to work additional hours
7. The usual patterns of work in the industry
8. The nature of the employee's role and the employee's level of responsibility
9. Any other relevant matters

‘One In, All In’ Does Not Apply

On in, all in does not apply and overtime should only be assigned to an employee based on specific work requirements.

Rest break

Employees working overtime must have a rest break of 20 minutes without any deduction of pay after each 4 hours of overtime worked if the employee continues work after the rest break.

When a day worker is required to work overtime on a Saturday, Sunday or public holiday or on a rostered day off, their first rest break must be paid at the employee’s ordinary hourly rate.

Rest Period After Overtime

When overtime work is necessary, an employee must have at least 10 consecutive hours off between the work of successive working days.

If an employee resumes work without having 10 consecutive hours off, the employee must be paid at 200% of the ordinary hourly rate until the employee is released from duty.

The employee is then entitled to be absent until they have had 10 consecutive hours off duty without loss of pay for ordinary hours.

For example, if your employee returns to work after only having an 8 hour break, they must be paid 200% of their ordinary hourly rate until they stop working.

Call Back

When an employee is recalled to work overtime after leaving, they must be paid:

• A minimum of 4 hours at 150% of the ordinary hourly rate for the first 3 hours and 200% of the ordinary hourly rate after that or
• If the employee is a continuous shift worker, at 200% of the ordinary hourly rate for the full period

For example, if your employee has already left work but is called back in to work for another 5 hours, they need to be paid at a rate of 150% of their ordinary hourly rate for 3 hours and 200% for 2 hours.

Standing By

When an employee is required regularly to be ready to work after ordinary hours, they must be paid standing by time at their ordinary hourly rate for the time they are standing by.

Transport of Employees

When an employee finishes work at a time when reasonable means of transport aren’t available, the employer must provide transport home, or pay the employee at the overtime rate for the time taken to reach home.

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Penalty Rates for Day Workers

The below table outlines the rates that employees are entitled to at different times:

Rates for Shift Workers

An employee that is working on the afternoon or night shift must be paid 115% of the ordinary hourly rate.

An employee who works on an afternoon or night shift which does not continue:

• For at least 5 successive afternoon or night shifts or 6 successive afternoon or night shifts in a 6 day workshop or
• for at least 38 ordinary hours, must be paid for each shift 150% of the ordinary hourly rate for the first 3 hours and 200% of the ordinary hourly rate for the remaining hours.

Permanent Night Shift

Employees who:

• work only night shift;
• remain on night shift for a longer period than 4 consecutive weeks; or
• work on a night shift which does not rotate or alternate with another shift

Must be paid 130% of the ordinary hourly rate for all time worked during ordinary working hours.

Work on Shifts Other than Rostered Shifts

Where an employee works on a shift other than a rostered shift, the employee must be paid as below:

For example, an employee that does shift work and is working an 8 hour shift on a day that they weren’t rostered to work must be paid at a rate of 150% of their ordinary hourly rate for 3 hours and 200% for 5 hours.

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Under the Manufacturing Award, a rate of 17.5% leave loading on top of their annual leave is applied when an employee takes paid time off.

Employees must be paid the higher of:

• an annual leave loading of 17.5% of their ordinary pay rate; or
• the weekend and shift penalties the employee would have received if they weren’t on leave during that period.

Example:

If a full-time employee applies for leave between Thursday this week and Wednesday next week, he or she would typically work 8 hours of shiftwork on a Saturday too. 

The employer must calculate 38 hours, including a 17.5% leave loading and compare with how much the employee will typically receive if they had been paid working across that period with the Saturday penalty rates.

Whichever of the two calculations is higher is how much the employee should be paid across that period of time, not for individual days.

The idea is so that the employee is protected from being paid less for going on paid annual leave.

Leave on Termination

On termination of employment, employees must be paid for any accrued annual leave that has not been taken.

Excessive Leave Accruals

If an employee has accrued more than 8 weeks paid annual leave (or 10 weeks’ paid annual leave for a shift worker), they have excessive leave accrual. When this occurs, an agreement between the employer and employee can be made where the leave is either paid out or taken at a convenient time.

Direction by Employer that Leave Be Taken

If an employer has genuinely tried to reach an agreement with an employee, but an agreement can not be reached, an employer can direct an employee in writing to take a period of paid annual leave.

Request by Employee for Leave

If an employee has genuinely tried to reach an agreement with an employer, but an agreement can not be reached, an employee can give written notice requesting paid annual leave.

Annual Leave in Advance

Employers and employees may agree in writing to the employee taking a period of paid annual leave before the employee has accrued the leave. However, an agreement must:

• state the amount of leave to be taken in advance, and the date on which leave is to commence; and
• be signed by the employer and employee.

The employer must keep a copy of any agreement as an employee record.

If on the termination of employment, the employee has not accrued all of a period of paid annual leave already taken, the employer can deduct the amount that was paid to the employee for taken annual leave from any money due to the employee.

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Cashing Out of Annual Leave

Employers and employees may agree in writing to cashing out a particular amount of an employee’s accrued paid annual leave. The agreement must state:

• the amount of leave to be cashed out and the payment to be made to the employee; and
• the date the payment is to be made.
• The agreement must be signed by the employer and employee.

An agreement must not result in the employee’s remaining accrued paid annual leave being less than 4 weeks, with a maximum amount of paid annual leave that can be cashed out in 12 months being 2 weeks.

The employer must keep a copy of any agreement as an employee record.

Personal/Carer’s Leave and Compassionate Leave

Personal/carer’s leave and compassionate leave are covered under the National Employment Standards (NES). 

The NES allows for 2 days compassionate leave per incidence and 10 days paid sick or carers leave.

If an employee is terminated and re-engaged by the same employer within 6 months, the employee’s unclaimed paid personal/carer’s leave balance continues from the date of re-engagement.

Parental Leave and Related Entitlements

Parental leave and related entitlements are covered under the National Employment Standards (NES). 

All employees are entitled to 12 months of unpaid parental leave, with the ability to request an additional 12 months.

Community Service Leave

Community service leave is covered under the National Employment Standards (NES).

Under the NES there is no limit to the amount of community service leave that employees can take.

Reimbursement for Jury Service

A full-time employee that is required to attend jury service during their ordinary hours of work must be reimbursed the difference between the amount paid to the employee for attendance for such jury service and the wages the employee would have received in their ordinary work hours.

When a part-time employee is required to attend for jury service on a day that they would normally be required to work, payment must be made to the employee.

Unpaid Family and Domestic Violence Leave

Unpaid family and domestic violence leave are covered under the National Employment Standards (NES).

All employees, regardless of their employment type, are entitled to 5 days of unpaid family and domestic violence leave per year.

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Public holidays differ from state to state, so it’s important to stay up to date with your state’s annual public holidays. On these days, public holiday rates apply.

Payment for Work on Public Holidays or Substitute Day

Employees who work on a public holiday are entitled to the appropriate payment rates.

If an employee works on both a public holiday and on a day that is substituted for the public holiday, the public holiday penalty rate applies to just one of those days. The employee may choose which one is to be paid at the public holiday penalty rate.

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Job Search Entitlement

When an employer gives an employee notice of termination, the employee must be given up to one day off without loss of pay to seek other employment.

This time off is to be taken when convenient to the employee, after consultation with the employer.

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Redundancy is also an area where standards differ between employment types and the length of time that an employee has engaged with an organisation for.

Small Furnishing Employer

Subdivision B of Division 11 in the National Employment Standards (NES) outlines that redundancy pay standards do not apply to businesses that are officially classified as a small business, as well as employees at all organisations who have been employed for less than 12 months.

Redundancy pay an employee is entitled to must be calculated with the following table:

Transfer to Lower Paid Duties on Redundancy

This applies to employees that are transferred to new duties on a lower rate of pay, due to redundancy. The employer must give the employee notice of the transfer at least the same length as if it were a notice of termination.

Employee Leaving During Redundancy Notice Period

An employee given redundancy notice may terminate their employment during the minimum period of notice. The employee is entitled to receive the benefits and payments they would have received had they remained in employment until the expiry of the notice.

However, the employee is not entitled to pay after the employee ceased to be employed.

Job Search Entitlement

When an employer has given notice of redundancy to an employee, the employee must be given up to one day off without loss of pay to seek other employment.

This time off is to be taken when convenient to the employee, after consultation with the employer. If requested by the employer, the employee must produce proof of attendance at an interview.

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Casual Loading for Vehicle Manufacturing Employees in the Technical Field

Employees in the technical field need to be paid a casual loading of 17.5% and are additionally entitled to both annual leave and annual leave loading on a pro-rata basis.

Employers must agree with the employee if an alternative casual loading of 25% will apply to the employee. If there are any changes to the original agreement, there should be a mutual agreement and recorded.

Payment of Fees for Vehicle Manufacturing Trainees

Trainees who attend at least 80% of the maximum possible attendance in a year at a training institution, and pass their exams or achieve a satisfactory report, must be reimbursed for all fees paid.

If a trainee does not meet minimum attendance rates, but still passes or achieves a satisfactory report, the employer must reimburse a like proportion of fees.

However, employers don’t need to reimburse fees, or a proportion of them, for more than one year over the period for the course.

If a trainee is employed by more than one employer in any school year, the last employer will be liable only for fees pro-rata to the period that they are employed with that employer.

Ordinary Hours of Work - Shiftworkers

Continuous Work Shifts - Vehicle Manufacturing Employees

Continuous work is work that’s carried out on consecutive shifts throughout the 24 hours of each of at least 5 consecutive days without interruption except during breakdowns or meal breaks.

An employee working on continuous work shifts can work up to 6 shifts per week.

Ordinary hours for shift workers on continuous work must average 38 per week, including crib time, and can not exceed 152 hours in 28 consecutive days.Shifts can not consist of more than 10 hours, including crib time. Provided that:

• Where there is an agreement that the ordinary working hours are to exceed 8 on any shift, the arrangement must be agreed on between the employer and the majority of employees concerned
• Except at the regular changeover of shifts, employees will not be required to work more than one shift in each 24 hours
• Shiftworkers will be allowed 20 minutes to shift for crib which will be counted as time worked
• Ordinary hours are worked continuously except for meal breaks

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Other than Continuous Work Shifts - Vehicle Manufacturing Employees

Ordinary hours of work should average 38 hours per week without exceeding 152 days within 28 consecutive days.

The ordinary hours are to be worked continuously except for meal breaks. Your employees can not be required to work for more than 5 hours without a break for a meal.

Except at the regular changeover of shifts, employees will not be required to work more than one shift in each 24 hours provided that:

• Shifts can not consist of more than 10 hours
• If ordinary working hours exceed 8 hours, both employers and the concerning staff need to agree

Meal Break - Vehicle Manufacturing Employees in the Technical Field

Meal breaks must be not less than 30 minutes or more than one hour and need to be taken between 11.30am and 1pm Monday to Friday for day workers.

Tea Breaks - Vehicle Manufacturing Employees

Employees Other Than Those in the Technical Field

In addition to a meal break, employers can provide either a morning or afternoon tea break of no more than 15 minutes to employees. When breaks are unpaid, it must not exceed 15 minutes duration. If both a morning and an afternoon tea break are taken on the same day or shift, at least one of these breaks must be paid.

Morning and Afternoon Tea - Technical Field Employees

Your employees are entitled to a 10 minute morning tea rest period and to partake of refreshment in the afternoon, without interrupting work.

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Junior Tracers in the Technical Field Vehicle Manufacturing Employees

The table below shows the minimum rates that apply to junior tracers in vehicle manufacturing in the technical field:

Allowances and Related Matters - Vehicle Manufacturing Employees

The following allowances apply to vehicle manufacturing employees:

1. Tool allowance - Tradespersons and apprentices in vehicle manufacturing - if your employee is required to provide their own hand tools
2. Inspector’s allowance - if your employee is required to work as an inspector
3. Carpenter’s allowance - if your employee is required to engage in carpentry work
4. Goggles allowance - if your employee is required to wear goggles
5. Glass or slag wool allowance - if your employee is required to handle loose slag wool or glass
6. Handling garbage allowance - if your employee is required to assist in vehicle handling garbage
7. Boiler house employees - if your employee is required to work in a boiler house
8. Forklift or cranes allowance - if your employee is required to drive a forklift or crane

Search our database for all relevant allowances to your modern award.

Accident Pay - Vehicle Manufacturing Employees

Accident pay is a weekly payment that is the difference between the amount of compensation paid to an employee for workers compensation and the amount that would have been paid in personal leave at the date of injury.

Entitlement to Accident Pay

Employers must pay accident pay, where an employee suffers an injury.

An employee is only entitled to payment while the employee remains working for the employer. However, employers must not terminate an employee to avoid any payment.

Notice of Injury

When an employee is injured, they must give notice in writing of the injury to their employer as soon as reasonably practicable after receiving the injury. Notice can also be given by a representative of the employee.

Maximum period

The maximum period of accident pay to be made in 26 weeks for any one injury. This period starts from the first day that your employee isn’t able to work.

Pro-Rata Payments

For a period of less than one week, accident pay is calculated on a pro-rata basis.

Return to Work

Employees entitled to accident pay returning to work on reduced hours or performing modified duties will be paid reduced accident pay by any amounts paid for the performance of such work.

When Not Entitled to Payment

Employees will not be entitled to any payment for any of the above reasons in respect to:

• any period of paid annual leave or long service leave or for any paid public holiday;
• any injury during the first 5 normal working days of incapacity;
• any incapacity occurring during the first 3 weeks of employment; and
• industrial diseases contracted by gradual process, or injuries subject to recurrence, aggravation or acceleration

Medical Examination

To receive accident pay, an employee must meet requirements for worker’s compensation legislation relating to a medical examination.

If:

• A medical referee gives a certificate that complies with workers compensation legislation
• Work is made available by the employer
• The employee refuses the work or fails to commence the work

Redemptions

If an employee receives a lump sum payment instead of weekly payments, the employer’s liability to pay accident pay will stop from the date the employee receives that lump sum payment.

When Payments cease

All rights to payments will cease upon the death of an employee.

Changes to Rates in Workers Compensation Legislation

The amount of accident pay payable will not increase if there are any changes to compensation rates under the applicable workers’ compensation legislation.

Engagement of Employee

When hired, employees may be required to declare all workers compensation claims that have been made in the previous 5 years.

Casual Employees

For a casual employee the weekly payment is calculated using the employee’s average weekly ordinary hours over the previous 12 months or, if the employee has been employed for less than 12 months, the employee’s average weekly ordinary hours throughout employment. The weekly payment includes casual loading but does not include over award payments.

No Obligation to Take Out Insurance

There is no requirement for an employer to take out insurance against liability for the payment of benefits above.

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Shiftwork and Rates - Vehicle Manufacturing Employees

Penalty Rates For Shift Workers - Weekday and Saturday Shifts

An afternoon shift is a shift starting no later than 6pm on any day.

A night shift is a shift starting at any time after 6pm on any day.

Employees who work an afternoon or night shift (other than a continuous work shift):

• that does not continue for 5 successive afternoons or nights or more in a 5 day workshop or 6 successive afternoons or nights or more in a 6 day workshop will be paid at the rate of 150% of the minimum hourly rate;

• that has been in operation for 5 successive afternoons or nights or more in a 5 day workshop or 6 successive afternoons or nights or more in a 6 day workshop will be paid the following amounts:

• The extra rates above are payable only when shifts are changed once in every 3 weeks or shift cycle. Otherwise, the extra rates for night shifts and afternoon shifts will apply.
• An employee that works continuous afternoon or night shifts at the rate of 112.5% of the minimum hourly rate
• The minimum rate to be paid to a shift worker for working between midnight on Friday and midnight on a Saturday is 125% of the minimum hourly rate.

Penalty Rates For Shiftworkers - Sunday Shifts

The following rates apply for shiftworkers working on Sunday:

For example, an employee that works from 10pm Saturday to 6am Sunday must be paid 200% of their minimum hourly rate.

Penalty Rates for Shiftworkers - Public Holiday Shifts

The following rates apply for shiftworkers working on a Sunday:

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Overtime - Vehicle Manufacturing Employees

Time Off Instead of Payment for Overtime

Time off instead of overtime payment may be provided if your employee elects it, and it is agreed to by the employer. It must be taken at a mutually convenient time within 4 weeks of the overtime being worked.

Time that is taken off instead of payment must be equal to the overtime rate.

Overtime Crib Breaks

Employees that are required to work more than 1.5 hours of overtime after working ordinary hours will be allowed a crib break of 20 minutes before their overtime. This break is paid at the minimum hourly rate.

After every 4 hours of overtime worked, an employee must be allowed a crib break of 20 minutes without loss of pay.

For example, if an employee is working 8 hours or normal hours and 3 overtime hours, they must have a 20 minute crib break before the end of 8 hours.

Crib Breaks - Sundays and Public Holidays

Employees working more than 9.5 hours on a Sunday or a public holiday will have a paid crib break of 20 minutes after 8 hours.

Meal Allowance

Employees who work more than 1.5 hours of overtime without notice are entitled to a meal allowance of $14.65 per meal.

This meal allowance is not payable if the employee is provided with a meal, or if the employee lives in the same area as the workplace and can reasonably go home for meals.

Minimum Break Between Shifts

An employee cannot work more than 14 hours within 24 consecutive hours, meaning that employees may have at least 10 consecutive hours off duty in each 24 consecutive hours.

If an employee resumes or continues work on direction from their employer without having 10 consecutive hours off, they must be paid at 200% of the minimum hourly rate until released from duty.

For example, if an employee returns to work after only having a 7 hour break, they must be paid at a rate of 200% of the minimum hourly rate until they go home.

Call Backs

Employees that are recalled to work overtime after leaving the business premises must be paid for a minimum of 3 hours work at their appropriate rate for each time recalled

This does not apply when:

•  it is normal for employees to return to business premises for periods shorter than 30 minutes to perform specific jobs outside the ordinary working hours;
• the overtime is continuous with the start of ordinary working time; and
• the actual time worked is less than 3 hours.

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You can also download a FREE copy of our Manufacturing Award eBook with a BONUS payroll processing checklist to ensure you maximise your payroll compliance.

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