Although we first began talking about flexibility in the workplace in the 1980’s as a way to offer more people access to the elusive work/life balance, it has taken a while to get the legislation to catch up! Over the years there have been major and minor adjustments to the legislation that have helped define and then redefine how business owners address the importance of flexible working arrangements.
So how does it work when you need to balance the needs of your business and the requests of employees?
Under the Fair Work Act, you are able to have individual (or group through an EBA) agreements with staff that allow you to pay one flat rate of pay regardless of when the person works – weekdays, evenings, weekends, even public holidays can be covered. Naturally this really only affects award based employees – senior level roles attracting salaries well over the award already have flexibility.
THE KEY CONSIDERATIONS
Before we get too excited and ahead of ourselves we need to remember two key words here –
- Agreement – so both parties need to genuinely agree!
- Flexibility – that is it needs to work both ways.
Section 7 of all Modern Awards provides for flexibility in agreements between employers and employees around certain criteria, which are:
- Arrangements for when work is performed (i.e. hours of work);
- Overtime rates;
- Penalty rates;
- Allowances; and
- Leave loading.
HAVE YOU GIVEN THE REQUEST THE BOOT?
In order to ensure an employee is not adversely affected by the flexibility agreement, Fair Work Australia requires the agreement to pass the 'better off overall test' (BOOT). That is, the employee must be better off overall than they would have been under the Award and NES alone – i.e. on base award rates plus penalties etc.
To ensure they are better off overall, you need to calculate what they would have received under the Award, for the shifts they work, and ensure the one flat rate of pay is higher than all of these penalties etc. combined.
An individual agreement can be beneficial for both the individual and the business so if this is something that you think could benefit your team or even just one person in your team, and you want some advice or help with implementation, call or email the team at HR Staff N' Stuff and we'll get you sorted.