Edge Legal
No.
The proposed Fair Work Amendment (Protecting Penalty and Overtime Rates) Bill 2025 was recently tabled in Parliament with the intention of protecting penalty rates and overtime rates in Modern Awards only.
Our Take
There has been a lot of unnecessary and uniformed hysteria about this issue. The proponents of legislation seem to be using ‘broad brushed’ comments designed to show them as defenders against the ‘not forgotten’ Workchoices era. Similarly, opponents have cast the legislation as yet a ‘further reason’ why business is so hard at the moment.
We think it is neither. The proposed changes only apply to FWC’s handling of applications to make, vary or revoke modern awards – a very niche area – granted it hasn’t been helped with recent applications in the Retail and Banking industries seeking to introduce rolled up rates much like that currently exists for managerial employees in the Hospitality modern award.
Enterprise Agreements will still be able to create an all in rates provided they meet the BOOT. Employment contracts will still be able to apply all inclusive salary clauses provided offsetting clauses are properly considered and drafted. The current flexibility clauses in Awards are also going to be unchanged.
Action Items:
Monitor the progress of the Bill and assess its potential impact on your business.
Review existing contractual offsetting arrangements and ensure they comply with current laws.
Thoroughly scrutinise enterprise agreement clauses for BOOT issues.
Genuinely apply the flexibility clauses in Awards to apply both the financial and non-financial benefits tests.
