Miscellaneous Award Coverage set to expand effective 1 July 2020

From 1 July 2020 there will be a significant increase in the number of employees covered by Modern Awards due to variations made to the coverage clause of the Miscellaneous Award arising as part of the Fair Work Commission’s 4-yearly review of Modern Awards.

Managerial and Professional Employees

A recent decision of the Full Bench of the Fair Work Commission determined that clause 4 of the Award ‘did not meet the modern awards objective in s 134(1) of the FW Act and that the clause should be varied’ as follows:

4.2   The award does not cover managerial employees and professional employees such as accountants and finance, marketing, legal, human resources, public relations and information technology specialists.

The Full Bench decision removed from the exclusion at 4.2 reference to “those classes of employees who, because of the nature or seniority of their role, have not traditionally been covered by awards”.

The result of this deletion means senior employees not excluded by clause 4.2 will now be eligible to be covered by the Miscellaneous Award.

Managerial and professional employees such as “accountants and finance, marketing, legal, human resources, public relations and information technology specialists” not covered by another Modern Award will continue to be award-free.  Importantly, some accountants will be covered by the Banking, Finance and Insurance Award, likewise some Information Technology professionals will be captured by the coverage clause in the Professional Employees Award.

Employees not covered by another award

Clause 4.3 was also varied with the deletion and insertion of new provisions as follows:

4.3          The award does not cover employees

The award does not cover employees excluded from award coverage by the Act.

The Full Bench decision removed from 4.3 the following exclusion:

4.3          The award does not cover employees:

(a) in an industry covered by a modern award who are not within a classification in that modern award; or

(b) in a class exempted by a modern award from its operation, or employers in relation to those employees.

The result of the deletion of the original 4.3 means employees who would otherwise be subject to another Award may no longer be excluded from the Miscellaneous Award.

The Full Bench explained the need for an amendment to clause 4.3 by providing the example that there is no occupational modern award covering “all cleaners or security guards”.   The Commission examined the Security Services Industry Award which covers only security guards employed by contract security businesses.  The Commission pointed out that while other industry awards may have classifications for security guards directly employed by an employer in an industry, some industries do not.

By way of example, the Commission discussed the possibility of a building industry employer engaging a security guard to watch over a work site during non-working hours. The Building and Construction General On-site Award contains no comparable security classification and therefore under the previous wording of clause 4 of the Miscellaneous Award, the employee would be award-free.   The Commission stated there would be “no intelligible industrial rationale for this outcome”.

Lower-skilled, Lower Paid Employees

There has been a traditionally view that the Miscellaneous Award only covered lower paid employees who were covered by an award before the modernisation of awards in 2010.  A recent Full Bench decision of United Voice v Gold Coast Kennels Discretionary Trust t/a AAA Pet Resort challenged this view.  The Full Bench held that animal attendants at pet resorts are the type of “lower skilled and modestly or low-paid employees of the type which ordinarily would be most suited to award coverage.”

In reaching its decision, the Full Bench stated, “there is nothing otherwise unusual about their employment which would render them unsuited to award coverage.” This was despite the fact the employer had evidenced a letter from the Fair Work Ombudsman stating there was “no award coverage” for animal attendants.

It is anticipated that as a result of the recent decision in AAA Pet Resorts and the expansion of the coverage clause of the Miscellaneous Award to become operative from 1 July 2020, a significant number of employees will be covered by the Miscellaneous Award.

Aitken Legal recommend all employers identify all employee’s in their workforce that were previously considered award-free and seek advice from one of our employment law specialists.  It is imperative that employers correctly classify employees and meet any relevant modern award minimum standards.

Disclaimer: The information contained this article is general and intended as a guide only. Professional advice should be sought before applying any of the information to particular circumstances. While every reasonable care has been taken in the preparation of this update, Aitken Legal does not accept liability for any errors it may contain. Liability limited by a scheme approved under professional standards legislation.