Employment and Workplace Relations update: FWC changes to General Retail Industry Award providing more flexibility for part-time employees are now in effect

On 28 June 2021, the Fair Work Commission (FWC) announced changes to the General Retail Industry Award 2020 (Retail Award) providing more flexibility for part-time employees and their employers, which came into effect on 1 July 2021.

Under the changes made to the Retail Award, employers and their part-time employees will be able to agree to extra hours by text message, email or other electronic means.

Background to FWC decision

In February 2021, the Shop, Distributive and Allied Employees’ Association (SDA), the Australian Workers’ Union (AWU) and Master Grocers Australia (MGA) jointly submitted an application to the FWC asking for it to vary the Retail Award in a number of ways, which included varying Clause 10.6 to enable employees to work additional hours by part-time employees by agreement with their employer.

On 1 March, the FWC published a statement inviting submissions in response to the revised application filed by the SDA, AWU and MGA.

Opposing the granting of the Application, the Australian Business Industrial and NSW Business Chamber in their alternative proposal stated that Clause 10.6 already allows employers and part-time employees to agree that an employee will work additional hours of work, in excess of their agreed regular pattern of work, paid at their ordinary hourly rate.

FWC’s decision

The FWC decided that Clause 10 was uncertain and required a variation to resolve that uncertainty. Also, it decided that the Retail Award should have a mechanism that allows a part-time employee who regularly works additional hours to request that their guaranteed hours be reviewed and increased, and their employer cannot unreasonably refuse such a request.

The variations were made in a Draft Determination on 18 May 2021.

The current Retail Award provisions

For an employee’s regular pattern of work or roster to be changed by mutual agreement, Clause 10.6 of the Retail Award states that, ‘the employer and the employee may agree to vary the regular pattern of work … in writing’.

The varied provisions

Additional hours agreement

The variation enables employers and employees to make temporary or continuing changes to the employee’s regular pattern of work. They must do so in writing — which includes ‘an exchange of emails, text messages or other electronic means’ — before the end of a particular shift or before the variation takes effect.

Employers are now able to change an employee’s regular pattern of hours with 7 days written notice (or 48 hours in an emergency), but it ‘must not be changed from week-to-week or fortnight-to-fortnight to avoid any award entitlements’.

In summary:

• the agreement can be recorded in writing including through an exchange of emails, text messages or by other electronic means;
• the agreement cannot result in the employee working 38 or more ordinary hours per week;
• the agreement and any variations to the employee’s regular pattern of work must be recorded and maintained by the employer;
• the employer’s record must be given to the employee if they request it; and
• employees work additional hours at ordinary rates of pay (including any penalty rates) so they are paid overtime only when they exceed the guaranteed hours agreed with the employer and not when they exceed what would have been their ordinary hours prior to the agreement with the employer.

Request to review guaranteed hours of work

If the employees’ guaranteed hours (the usual contracted hours before any agreement to work additional hours) are less than the ordinary hours they have worked in the previous 12 months, then they may request in writing that the employer increase their guaranteed hours on an ongoing basis to reflect the ordinary hours regularly being worked. This request may only be made once every 12 months.

The employer must respond in writing to the employee’s request within 21 days.

The employer may refuse the request only on reasonable grounds such as the extra hours being only because of temporary reasons such as another employee leaving their position. However, employers inclined to reject a request must discuss it with the employee and genuinely try to reach agreement.

Takeaways for employers

If the Retail Award applies to your business then you should be aware of your record-keeping and payment obligations arising from these changes. Also, employers need to make sure they consider the consequences of any change to guaranteed hours of work and the requirements to appropriately consult with employees when the employees request for their guaranteed hours to be changed considering their work patterns in the prior 12 months.

More information

For more information on the recent changes to the Retail Awards, or for general advice on modern awards, please contact a member of our Employment and Workplace Relations team:

Author

This Employment and Workplace Relations update was authored by Nadeem Mekhat, Associate.

Note: This update is a guide only and is not intended to constitute legal advice.