Coverage of the Supported Wage System
The Supported Wage System operates across both federal and state workplace relations regulatory frameworks.
Australia’s federal and state workplace relations systems
The federal workplace relations system covers the majority of employers and employees in Australia, including:
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trading, financial and foreign corporations (constitutional corporations) and their employees;
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employees and employers in the Australian Capital Territory, the Northern Territory and Christmas and Cocos (Keeling) Islands;
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the Commonwealth, including its authorities and its employees;
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employers in respect of waterside, maritime and flight crew employees employed in connection with interstate, overseas, inter-territory or state-territory trade and commerce; and
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most employees and employers in Victoria.
The federal system does not cover unincorporated businesses, some state government employers and sole traders or partnerships (apart from those in Victoria and the territories). These employers and employees are covered by the relevant state workplace relations systems.
Scope of the Supported Wage System assessment rate
The productivity percentage rate, determined by approved assessors under the Supported Wage System, applies only to the basic rate of pay and any wage-related leave entitlements. All other employment conditions, such as the length of annual and long service leave or the employee’s access to training, are determined in accordance with the conditions prescribed in the relevant federal or state industrial instrument.
Applying the Supported Wage System assessment rate
The minimum wage upon which the productivity based percentage rate is applied, will vary depending on whether the employer and employee are covered by the federal or state workplace relations systems, and which particular industrial instrument they are employed under.
Minimum wages under the federal and state systems
Under the federal jurisdiction, minimum wages are presently separate from awards and are guaranteed by Australian Pay and Classification Scales (Pay Scales), the Federal Minimum Wage or a special Federal Minimum Wage.
Adjustments to minimum wages, are currently determined by the Australian Fair Pay Commission. The Commission normally hands down its decisions in July each year with any adjustments taking effect from 1 October.
Details of minimum wage decisions can be found by visiting the Australian Fair Pay Commission website (please see related links). Updated Pay Scale summaries can be downloaded from the Workplace Authority website (please see related links).
Under the state workplace relations systems, minimum wages are presently contained in awards and are adjusted in accordance with decisions of the various state industrial relations tribunals. Some state tribunals also set and adjust minimum wages that apply where the employer is not covered by an award. The decisions of the tribunals and the date of effect for any adjustments vary from state to state.
State authorities
Further information can be obtained from the relevant state authorities as follows:
Queensland
Department of Employment and Industrial Relations
Wageline: 1300 369 945
Website (link will open in a new window):
New South Wales
Office of Industrial Relations
Tel: 131 628 (when connected dial 2 and then 4611) or 1800 803 836
Website (link will open in a new window):
Tasmania
Workplace Standards Tasmania
Helpline: 1300 366 322
Website (link will open in a new window):
South Australia
SafeWork SA
Help Centre: 1300 365 255
Website (link will open in a new window):
Western Australia
Department of Consumer and Employment Protection
Wageline: 1300 655 266
Website (link will open in a new window):
Special federal minimum wages for employees with a disability
In 2006, the Australian Fair Pay Commission established a set of new minimum wages for employees with a disability as defined under the federal workplace relations legislation. These special minimum wages include:
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the Special Supported Wage System (Employees with a disability) Australian Pay and Classification Scale for employees with a disability whose employment is covered by a Pay Scale that does not include provisions for determining a rate of pay in accordance with the Supported Wage System;
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a special Federal Minimum Wage for employees with a disability who are not junior employees or employees to whom training arrangements apply and who are not covered by a Pay Scale; and
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the special Business Services (Employees with a disability) Australian Pay and Classification Scale, for employees with a disability employed in a business service whose employment is not covered by a Pay Scale.
It is important to note that the two special Pay Scales noted above will not apply to an employee with disability where another Pay Scale covers the employee's employment and that Pay Scale determines a basic periodic rate of pay for the same particular class of employees with a disability as that covered by the special Pay Scale.
More information on these special minimum rates of pay can be found on the Australian Fair Pay Commission website (please see related links).
Who qualifies for these special minimum wages?
Employees with a disability are defined under the federal Workplace Relations Act 1996 as those who qualify for the Disability Support Pension under the Social Security Act 1991, or who would be so qualified but for certain Australian residency requirements.
Recent changes to the federal workplace relations system
On 28 March 2008, a number of changes to the workplace relations system came into effect, under the Workplace Relations Amendment (Transition to Forward with Fairness) Act 2008. These changes:
- prevent the making of new Australian Workplace Agreements;
- allow employers using AWAs as at 1 December 2007 to offer Individual Transitional Employment Agreements (ITEAs) to new employees and employers already on AWAs, for the transition period to 31 December 2009, while award modernisation takes place;
- introduce a genuine no-disadvantage test for new collective agreements and ITEAs;
- enable the Australian Industrial Relations Commission (AIRC) to undertake the process of award modernisation; and,
- remove the requirement for employers to provide the Workplace Relations Fact Sheet to their employees.
How do the recent workplace relations changes impact on the Supported Wage System?
The recent changes to the workplace relations system mainly affect employees covered by an existing Australian Workplace Agreement (AWA), a collective agreement or a Notional Agreement Preserving State Award (NAPSA).
If you are covered by one of these industrial instruments you can obtain more detailed information on how the changes may affect you by visiting the Workplace Authority website (please see related links) or by calling the Workplace Infoline on 1300 363 264 between 8.00 am to 7.00 pm, Monday to Friday.
Other aspects of the Supported Wage System continue to operate largely unchanged. It remains the responsibility of employers to ensure that any Supported Wage System agreement is based on an industrial instrument that includes Supported Wage System provisions.
Supported Wage System Assessments must also continue to be reviewed by the assessor, either on the basis of a reasonable request by the employee or at least annually, to ensure an employee’s productive capacity on the job is reflected in their wage rate.
What about employees who currently hold a ‘slow worker’ permit?
Slow worker permits operating immediately prior to the commencement of Work Choices on 27 March 2006 have effect as slow worker permit Pay Scales. Although slow worker permit Pay Scales were originally intended to expire on 27 March 2008, they continue to have effect by preserving minimum wages for affected workers.
No new slow worker permits have been issued under the federal system since 27 March 2006. However, disability wages may be available under either the Supported Wage System (SWS) or the arrangements that apply to employees in business services.
The new workplace relations system
The recent changes to the workplace relations system mark the beginning of the transition to the Government’s new fairer, more flexible and productive workplace relations system, which will be fully operational from 1 January 2010. The new system will include:
- a strong and simple safety net comprising ten legislated National Employment Standards and up to ten further minimum conditions in new, modern awards;
- a simple and fair collective bargaining system underpinned by majority rules bargaining, good faith bargaining and fast and simple collective agreement making arrangements to drive productivity with fairness;
- a workplace relations system with no individual statutory agreements;
- a single regulatory agency, Fair Work Australia, which will replace the multiple regulatory agencies currently in existence;
- protection from unfair dismissal for employees and a new process for resolving unfair dismissal claims which balances the needs of employees and employers with special arrangements for small business including a Fair Dismissal Code; and,
- a uniform system for the private sector.
The legislation for these changes is currently being developed through extensive consultation across the Australian community. The legislation is expected to be introduced into the Australian Parliament for consideration in late 2008.
Minimum wages under the new system and award modernisation
With the establishment of the new workplace relations system, from 1 January 2010, the current minimum wage system of Pay Scales will cease to operate. Minimum wages will be contained in a set of new, modern awards. Responsibility for setting and adjusting minimum wages will transfer from the Australian Fair Pay Commission to Fair Work Australia. Fair Work Australia will be required to review minimum wages in an open and transparent process once a year.
Award modernisation is currently being conducted by the Australian Industrial Relations Commission. This process began on 28 March 2008 in accordance with a request by the Government which is set out in the Workplace Relations Amendment Transition to Forward with Fairness Act 2008. The process is due to be completed by 31 December 2009. Please see award modernisation under related links for more information.