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Modern awards – are you ready?

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For not-for-profit organisations, sole traders and partnerships, 2011 is the proverbial eleventh hour for compliance with the modern awards. Depending on which state you operate in, there may be up to six changes in pay rates in 2011. It is time to check the batteries in your wage calculators!

All trading corporations (Pty Ltd) have been in the federal workplace relations system since 1 January 2010. Modern awards have replaced all state-based awards (such as Division 2B awards and NAPSAs) in the national system. Most non-government workplaces need to start operating under these modern awards NOW!

For all Victorians, Territorians and trading corporations, modern awards have been in effect since 1 January 2010.

While not-for-profits, sole traders and partnerships in Queensland, New South Wales, South Australia and Tasmania have needed to comply with the requirements of the Fair Work Act 2009 since January 2010, from January 2011 they must start to comply with modern awards as well.

Despite the Western Australian Government deciding not to refer their industrial relations powers to the Commonwealth, a recent Federal Court decision (the Bankstown decision) suggested that not-for-profit organisations that receive government funding may be deemed to be trading. This decision has the potential to move many non-profit organisations into the federal workplace relations system.

Changes under modern awards
The next six months will be a time of rapid and significant change for non-profits, sole traders and partnerships in Qld, NSW, SA and Tasmania:

From 1 January 2011, hours of work, allowances, overtime and time off in lieu provisions will change in line with the modern awards.
From 1 February 2011, rates of pay, casual loadings and penalty rates will be phased in according to the complex calculations under the transitional arrangements of each award. This may mean significant changes to the minimum rates of pay for all employees across your organisation.
From 1 July 2011, the minimum wage decision, various transitional arrangements, and the Fair Work Australia pay equity case decision will, in all likelihood, again impact on minimum rates of pay in those non-profit organisations in the community sector.

The importance of compliance
Non-compliance can lead to fines, back payments, and for some non-profit organisations jeopardise future government funding opportunities.

Fair Work inspectors are conducting more and more investigations and audits around Australia. We strongly recommend all organisations seek advice to ensure they are compliant with their workplace obligations, and that industry associations advise their sole trader and partnership members that the time to comply is now!

Go to our website at www.irgroup.com.au to read more about the Fair Work Act, National Employment Standards and modern awards.

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