Wage obligations under the WA awards
In order to comply with wage obligations towards employees, an employer will need to understand the following:
Identifying the applicable
Identifying the correct rate of pay that applies to each of your employees is an essential part of ensuring wage compliance.
Once you have identified the WA award that covers your employee’s employment and the employee’s classification under that award, the next step is to identify the correct rate of pay for the employee.
Under most WA awards, an employee’s minimum rate of pay is outlined in the ‘minimum wage’ or ‘wages’ clause of the award. Click on the exclamation point to see an example of how this looks.
Example
Shop and Warehouse (Wholesale and Retail Establishments) State Award 1977
The minimum rates of wages payable to workers under this award shall be as follows:
(1) With effect on and from the commencement of the first pay period on or after 1 January 2021.
Employees who are casual or part-time are required to be paid a pro-rata amount of what a full-time employee in their classification would be paid according to the hours of work they have performed.
Example - Shop and Warehouse (Wholesale and Retail Establishments) State Award 1977
Under this award, the minimum rate of wages payable to an adult Shop Assistant is $846.40 per week. A full-time employee under this award is required to work 38 hours a week. So to find the applicable pro-rata rate you divide the weekly wage by 38. The minimum adult award wage divided by 38 equals $22.73 an hour.
In order to pay a casual or part-time employee on a “pro-rata” basis you would multiply the amount of hours that the employee has performed work in a week by $22.73. Note that most awards will require that casual employees be paid a loading on top of their hourly rate.
Ordinary hours of work
Most WA awards will use the expression “ordinary hours”. This refers to the hours of work performed by an employee for which they are not paid overtime.
Usually, hours of work performed have to fall within certain time periods or occur on certain days to be defined as “ordinary hours”.
Penalty rates
Many WA awards will include higher rates of pay to apply to work performed on a Saturday or Sunday. There are also often penalties for late night work or for early starts. Such time is still ordinary hours of work.
Example
Shop and Warehouse (Wholesale and Retail Establishments) State Award 1977
“The rate of pay for part time workers working on Saturdays during ordinary time shall be determined according to the following formula:
Understandably, many employers struggle to calculate such formulas. Fortunately, for many awards, the Department of Mines, Industry Regulation and Safety provides WA award summaries that assist in identifying the correct rate of pay to apply on certain days.
Overtime
A WA award will usually include an overtime clause. Overtime occurs where an employee performs work outside of their ordinary hours of work. It is important for an employer to review such clauses thoroughly to ensure that employees receive an overtime payment whenever it is owed.
Overtime actual rate of pay
The actual rate of pay applicable for overtime varies from award to award. Generally, overtime tends to apply at the rate of either time and a half or double time.
Junior rates
You should also be aware that depending upon the age of your employees, they may be entitled to be paid a percentage of the applicable wages for an adult employee.
Example
Shop and Warehouse (Wholesale and Retail Establishments) State Award 1977
The minimum rates of wages payable to all junior workers covered by this award shall be as follows:
What resources are available to ensure that I meet my wage obligations towards employees?
The Department of Mines, Industry Regulation and Safety operate the Wageline service which can assist you with questions you have concerning employee pay, applicable pay rates, employee hours of work and leave entitlements.
WA awards and contracts of
As an employer, it is important to be aware of how the WA award that covers your business interacts with contracts of employment used for your employees.
It is important to understand that an employee’s entitlements as outlined in an award cannot be removed by an employment contract. For example, if an employee is entitled to receive a penalty rate for working on a Sunday under the WA award they cannot “sign away” this entitlement under a contract of employment.
What can an employment contract do?
Properly used, employment contracts play a crucial role in ensuring wage and record-keeping compliance. The use of employment contracts achieves the following:
Explains when and how an employee is to be paid
An employment contract should confirm how frequently an employee is to be paid (i.e. weekly, fortnightly, monthly) subject to the WA award. It should also explain if an employee is to be paid:
- at an hourly rate in line with the award;
- at a higher hourly rate than the award; or
- a salary that compensates the employee for their award entitlements (see the next module for information concerning things to consider when using a salary).
Ensures compliance with record-keeping obligations
Many WA awards include requirements that an employee is informed in writing as to the award they are covered by, their classification under that award, their type of employment and when their hours of work will be performed. The inclusion of such information in an employment contract ensures that this information is recorded and retained in one place.
