Federal awards
What is a Federal award?
Differences between State and Federal awards
Federal awards set out minimum wages and conditions of employment for specified employees. Federal awards apply only to specific employers within a particular industry and are maintained by Australian Industrial Relations Commission (AIRC) (non-Queensland Government link), an independent industrial tribunal.
The Workplace Relations Act 1996 (non-Queensland Government link) requires that Federal awards be simplified so that they only include 15 Allowable Award Matters and a Dispute Settling Procedure. Awards are not allowed to regulate matters that the Federal Government considers are dealt with better at the workplace.
- The 15 Allowable Award Matters under a Federal award are:
- ordinary time hours of work (including rest breaks);
- incentive-based payments and bonuses;
- annual leave loadings;
- ceremonial leave;
- leave for job seeking after notice of termination by the employer;
- public holidays;
- substitution days for public holidays worked;
- allowances;
- loadings for working overtime or for shift work;
- penalty rates;
- redundancy pay;
- stand-down provisions;
- dispute settling procedures
- type of employment, such as full-time employment, casual employment, regular part-time employment and shift work; and
- conditions for outworkers.
These allowable matters are set to change with the award modernisation process.
Along with the allowable matters, 10 National Employment Standards (NES) will provide a safety net that protects wages and minimum conditions. The 10 NES will protect all employees under the federal system. These standards will be guaranteed under legislation so that they cannot be modified or excluded.
The 10 matters dealt with by the NES are as follows:
- maximum weekly hours;
- requests for flexible work arrangements;
- parental leave and related entitlements;
- annual leave;
- personal/carer’s leave and compassionate leave;
- community service leave;
- long service leave;
- public holidays;
- notice of termination and redundancy pay;
- fair work information sheet.
These protective mechanisims will come into play upon the completion of the award modernisation process and will protect employees from January 2010.
More than one award may apply to an employee but provide for different parts of the overall employment package. e.g. the Clerks (ACT) Award 1998 provides for pay and conditions, and the Clerks (Long Service Leave ACT) Award 2000 provides for long service leave.
Employers covered by a Federal award are known as 'respondents'. Employees of the respondent employers are covered by the Federal award if they are doing the type of work to which the award applies.
There are three ways to be a respondent to a Federal award:
- the employer may be named in the award as a respondent in the 'Parties Bound' clause or Schedule
- through membership of a particular employer organisation and the employer operating within the scope of the award (e.g. Queensland Hotels Association - hotels)
- successorship - i.e. the business was purchased as a going concern from a respondent named in the award.
Find common Federal awards which apply to your industry.
Differences between State and Federal awards
A significant difference between Federal and State awards is the way they apply to employers.
Prior to WorkChoices, Federal awards were generally made by the AIRC as a settlement of an inter-State dispute (a dispute involving employees and employers in more than one State). Victoria, the Northern Territory and the Australian Capital Territory were covered by Federal awards (not State Awards) and relied on other reasons as the basis for their Federal award coverage.
Since the introduction of WorkChoices on 27 March 2006, the AIRC may only make new Federal awards as part of the Award Rationalisation process.
State awards are made by State industrial tribunals. State awards are similar in content to Federal awards, and also set out minimum pay and conditions of employment for groups of employees. A State award generally applies to every employer who employs a person in an industry or occupation covered by the award unless another industrial instrument overrides the Award.
Federal awards or agreements can apply to an employer (and therefore relevant employees working for that employer) when:
- the employer is specifically named in the parties bound clause
- the employer is a member of a Federally registered employer organisation named in the parties bound clause; e.g. the Australian Hotels Association
- an employer buys a business that is already named in a Federal award - the award then applies to the new owner
Are you covered by a Federal award? Find out more information on how they apply to you.
Last updated 21 July 2009
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