Australian Retailers Association, The

[2024] FWC 2163

FAIR WORK COMMISSION

STATEMENT

Fair Work Act 2009

s.158 – Application to vary or revoke a modern award
s.160 – Application to vary or revoke a modern award to remove ambiguity or uncertainty or correct error

Australian Retailers Association, The

(AM2024/9)

Variation on the Commission’s own initiative—General Retail Industry Award 2020

(AM2024/33)

Retail industry
JUSTICE HATCHER, PRESIDENT	SYDNEY, 15 AUGUST 2024

Application by The Australian Retailers Association to vary the General Retail Industry Award 2020 – proposed variations yet to be determined – commencement of new matter on the Commission’s own initiative as foreshadowed in final report on the Modern Awards Review 2023–24.

This statement concerns two matters. The first, matter AM2024/9, is an application made by the Australian Retailers Association (ARA) on 6 February 2024 to vary the General Retail Industry Award 2020 (Retail Award) in various respects (by way of variations designated A–Q) pursuant to ss 157 and/or 160 of the Fair Work Act 2009 (Cth) (FW Act). Some of the variations sought have already been determined by the Commission. Variation E was dealt with on an expedited basis and determined on the papers, and a decision[1] varying the Retail Award was published on 2 April 2024. Variation C was dealt with at an expedited hearing conducted on 1 May 2024, and a decision[2] varying the Retail Award was issued on 7 May 2024. As a result of a conferences conducted by the Commission on 26 April and 17 May 2024, agreement was reached by participating parties as to variations M and N, and the Retail Award was consequently varied[3] on 5 July 2024. The remaining proposed variations are yet to be determined by the Commission.

Matter AM2024/33 is a matter commenced on the Commission’s own initiative pursuant to ss 157(3)(a) and 160(2)(a) of the FW Act and arises from the final report[4] on the Modern Awards Review 2023–24 (Review) conducted by a Full Bench of the Commission, which was published on 18 July 2024 (Report). In the Review, the Commission among other things invited proposals to ‘make awards easier to use’. Submissions were received in response to these proposals, and consultations with interested parties concerning the proposals were conducted. In the Report, the Full Bench noted (at [136]) that there was a thematic overlap between the ARA application and a number of proposals advanced in the Review relating to the Retail Award, and went on to observe (at [146]):

… the Retail Award attracted the most proposals for change, and also proposals from the largest number of different parties. This perhaps reflects the fact that the Retail Award covers a higher proportion (11 per cent) of award-reliant workers than any other award. It certainly indicates a degree of concern amongst employers about the useability of this award which is significantly higher than for the other awards the subject of the Review

The relevant finding in the Report (at [161]) was as follows:

… it is clear that there remain significant concerns about the proper interpretation and application of a number of provisions in the Retail Award which may be said to potentially affect its practical useability. The ARA application raises a number of matters in this respect which will require determination in due course. As earlier stated, there is a significant overlap between the proposals raised concerning the Retail Award in this Review and the matters the subject of the ARA application. The appropriate course is that those proposals advanced in this Review which raise a serious issue as to ambiguity in or the practical operation of provisions of the Retail Award should be joined with the ARA application for consideration and determination…

The Report went on to conclude (at [167]) that the Commission would, on its own initiative, commence proceedings concerning the Retail Award as follows:

These proceedings will consider proposals advanced in the ‘making awards easier to use’ stream of the Review in respect of the Retail Award which overlap with the matters the subject of the ARA application, or which otherwise raised a seriously arguable case for change. However, the proceedings will not consider proposals concerning the part-time employment provisions of the Retail Award. The Commission-initiated proceedings concerning the Retail Award will be heard and determined together with the outstanding matters in the ARA application (except those matters in the ARA application concerning part-time employment). The proceedings will be initiated in August 2024, and the precise matters to be the subject of the proceedings will be identified at that time.

Consistent with this conclusion, I have constituted a Full Bench consisting of Vice President Gibian, Deputy President Clancy and Commissioner Matheson to hear and determine the following matters:

(1)In matter AM2024/9: proposed variation categories A (items 1 and 2 in the schedule to the originating application), B (items 3, 4 and 5), D (items 8, 9 and 10), F (item 12), G (items 13, 14 and 15), H (items 16 and 17), I (items 18 and 19), J (item 20), L (item 23 only),[5] O (item 27), P (items 28 and 29) and Q (item 31).

(2)In matter AM2024/33: the proposals advanced in the Review identified in the Schedule to this statement, subject to the party which advanced each proposal identifying that it is pressed in this proceeding.

The presiding member of the Full Bench will list the above matters for directions in due course. In the event that interested parties jointly consider that there would be benefit in the Commission engaging in conciliation with respect to any of the proposals, they may contact my chambers.

PRESIDENT

Schedule: Selected proposals from the ‘making awards easier to use’ stream of the Modern Awards Review 2023–24

Ref. no. in summary of submissions	Moving party	Retail Award clause(s)	Issue	Proposal
Common issues
12	The Australian Industry Group (Ai Group)	Nil (new)	Pay averaging: Awards allow work hours to be averaged over a period of up to 4 weeks, but not all provide for corresponding pay averaging. This leads to inconsistencies, especially where employees work varied hours but expect stable pay.	Add a clause that would permit employees' pay to reflect the average number of ordinary hours worked over the averaging period, ensuring alignment between worked hours and pay. Proposed wording: Notwithstanding anything else in this award, where an employee’s ordinary hours are averaged over a period of time, an employee may be paid for the average number of ordinary hours attributed to the relevant pay period.
Retail Award
37	Australian Workforce Compliance Council (AWCC)	5.11(b)	Agreement termination: Clause can be simplified post-2013 amendment.	Update to remove ‘(reduced to 4 weeks if the agreement was entered into before the first full pay period starting on or after 4 December 2013)’, i.e. to require 13 weeks’ written notice to terminate an individual flexibility arrangement (IFA) agreement in all cases.[6]
44	Ai Group	15	Hours of work: Ai Group suggests that Clause 15 be discussed in detail before the Commission, aiming to identify opportunities to simplify and clarify its provisions.	A comprehensive discussion with all stakeholders to address the various concerns associated with the current wording and application of clause 15.
50	Australian Hotels Association (AHA)	15.6	Hours of work — full-time employees (plain language): AHA seeks a plain language redrafting and streamlining of clause 15.6, including removing provisions addressed elsewhere in the Retail Award.	Replace clause 15.6 with the following: 15.6 Full-time employees a. In each establishment an assessment must be made as to the kind of arrangement for working the average of 38 ordinary hours per week required for full-time employment that best suits the business of the establishment, subject to the following: i. Employees must have 2 days off per week, or as averaged across the roster cycle, unless otherwise agreed. ii. The maximum number of consecutive days on which the employee may work (whether ordinary hours or reasonable additional hours) is 6. iii. Where the hours of work arrangement allow for an accumulated day off per 4-week cycle, the maximum accrual is 5 accumulated days. b. An employee may request to perform their full-time hours across no more than 19 days per 4-week cycle. The employer may only refuse the request on reasonable business grounds.
51	AHA	15.6	Hours of work — full-time employees (rostering): AHA seeks to remove the requirement for full-time employees to be rostered to work no more than 19 days in a four-week cycle.	Vary clauses 15.6(i)–(j) to allow full-time employees to be rostered to work 20 days in a four-week cycle unless the employee makes a request to perform their hours across no more than 19 days: Proposed wording: (x) An employee may request to perform their full-time hours across no more than 19 days per 4-week cycle. The employer may only refuse the request on reasonable business grounds.
52	AHA	15.7	Rostering arrangements: AHA seeks a plain language redrafting of clause 15.6 that is more consistent with other awards, including the Hospitality Industry (General) Award 2020 and the Restaurant Industry Award 2020.	Replace clause 15.7 with the following: 15.7 Rostering arrangements a. The employer must prepare a roster showing for each employee their name and the times at which they start and finish work. b. A roster period should not exceed 4 weeks, except by agreement. c. An employee should not be rostered to work ordinary hours on more than 5 days per week unless an agreement has been reached to work ordinary hours on 6 days in one week and no more than 4 days in the following week. d. An employee who regularly works Sundays must receive 3 consecutive days off (including Saturday and Sunday) per 4-week cycle.
53	ABI / BNSW	15.7, 15.8	Rostering arrangements and casuals: ABI and BNSW are seeking clarification on clauses 15.7 and 15.8 of the Retail Award regarding their applicability to casual employees. These clauses are causing operational and interpretation difficulties concerning the use of casuals in retail.	Clarify that the obligations in clauses 15.7 and 15.8 do not apply to casuals by inserting ‘This clause applies to full-time and part-time employees’ at the start of both clauses.
55	AHA	16	Breaks: AHA seeks to reduce the length of clause 16 without reducing entitlements for employees.	Replace clause 16 with a simplified clause based on clause 14 of the Miscellaneous Award 2020: 16. Breaks 16.1 An employee must not be required to work for more than 5 hours without an unpaid meal break of at least 30 minutes and not more than 60 minutes. 16.2 An employee is entitled to one 10-minute paid rest break for a shift that is between 4 and 7 hours and two 10-minute paid rest breaks for shifts longer than 7 hours.
56	AWCC	16.4	Rostering rest and meal breaks: This clause is subjective (what are meaningful breaks?) and does not create a direct financial consequence. It is better placed as an introduction to Clause 16.	Remove clause 16.4; clause 16. 1 and 16.2 are sufficient and the removal of clause 16.4 will help with compliance.
57	Ai Group	16.6	Taking meal breaks: Clause 16.5 restricts employers from requiring employees to take meal breaks at specific times, notably within the first or last hour of work, combining rest and meal breaks, or working more than five hours without a meal break. This clause does not explicitly address whether such arrangements can be made through mutual agreement, leading to potential inflexibility in managing work schedules.	Introduce a new clause 16.6 to the Retail Award, explicitly allowing employers and employees to agree on flexible meal break arrangements. This amendment aims to adapt the award to modern work practices, recognising the diverse needs of both employees and employers for flexibility in scheduling breaks, especially in scenarios not anticipated by the current wording of clause 16.5. Proposed wording: 16.6 An employer and employee may agree, on an ongoing basis or for a specified period of time, to one or more of the following arrangements, where the employee is entitled to the relevant break(s): (a) the employee will take rest breaks and/or meal breaks within the first and/or last hour of work; (b) the employee takes rest breaks combined with meal breaks; and/or (c) the employee will work up to 6 hours without taking a meal break.
59	AWCC	17.3	Apprentice rates: Confusing distinction between pre- and post-2014 apprentices.	Streamline the clause and create a pay rate table for clarity.
60	AHA	17.3	Apprentice rates: Clause 17.3 provides rates for an apprenticeship that was commenced prior to 1 January 2014. AHA is not aware of any members currently employing such an apprentice.	Delete the rates for apprenticeships commenced before 1 January 2014.
61	MGA	17.5, Sch A	Enhancing visibility of higher duties clause: Many MGA members utilise clause 17.5 of the Retail Award for workforce planning and employee career development. However, nearly 30% of surveyed members were not aware of this clause until recent engagements.	Add a cross-reference to clause 17.5 within Schedule A — Classification Definitions of the award to increase its visibility and accessibility, accompanied by a note explaining that clause 17.5 allows employees to temporarily perform duties at a higher classification.
62	National Retail Association (NRA)	18.2	Payment of wages: Averaging of hours for rostering purposes has limited utility if an employer cannot average the payment of wages over the same period. Currently, hours for a full-time employee can be rostered over a four-week cycle but payment of wages can only be averaged over a two-week cycle.	Vary clause 18.2 to allow employers to average wages across a four-week roster cycle.
65	MGA	19.9	Cold work allowance: MGA members are seeking clarification on what constitutes being ‘principally employed’ for cold work, noting the term could be interpreted in various ways.	Refine and narrow the definition of ‘principally employed’ within clause 19.9 to clearly articulate the conditions under which an employee qualifies for the cold work allowance.
66	Ai Group	19.10	First aid allowance: The current wording of the Retail Award first aid allowance provision does not explicitly accommodate the fluctuating nature of first aid responsibilities among employees, potentially leading to ambiguity regarding the applicability of the allowance.	Modify clause 19.10 to clarify that the first aid allowance is applicable only during periods when an employee is officially designated to perform first aid duties. This amendment aims to explicitly align the allowance with the actual assignment of first aid responsibilities, ensuring that only those actively serving in a first aid capacity are eligible for the allowance. Proposed wording: Clause 19.10 applies to an employee who has a current first aid qualification from St John Ambulance or a similar body, whilst they are appointed by the employer to perform first aid duty.
67	AHA	19.10	First aid allowance: Part-time and casual employees are not being appointed to perform first aid duties because clause 19.10 only provides for a weekly allowance.	Insert a daily first aid allowance up to a maximum of $12.94 over a week.
70	Ai Group	Nil (new) — proposed ‘20’	Exemption rates: The Retail Award does not currently facilitate the inclusion of exemption rates for employees in higher classification levels, potentially complicating payroll processes and limiting flexibility in remuneration strategies.	Incorporate an exemption rate within the award, specifically targeting full-time and part-time employees classified between Retail Employee Level 4 and Level 8. This initiative aims to simplify wage determination by exempting specified employees from certain award provisions if their salary exceeds the minimum wage by at least 25%, promoting a more streamlined approach to payroll and incentivising higher remuneration agreements. Proposed wording: 20. Exemptions 20.1 This clause applies to: (a) Full-time employees classified as Retail Employee Level 4 – Retail Employee Level 8 who are paid a salary that is at least 25% more than the applicable minimum wage for their classification level, as prescribed by clause 17.1, multiplied by 313/6. (b) Part-time employees classified as Retail Employee Level 4 — Retail Employee Level 8 who are paid a salary that is at least 25% more than the applicable minimum wage for their classification level, as prescribed by clause 17.1, multiplied by 313/6 and calculated on a pro rata basis. 20.2 The following provisions of the award do not apply to the [above] employees, where applicable: (a) Clause 10 — Part-time employees; (b) Clause 16 — Breaks; (c) Clause 14 — Rostering arrangements (employees other than shiftworkers) (d) Clause 16 — Breaks (e) Clause 18 — Payment of wages (f) Clause 19 — Allowances (g) Clause 21 — Overtime (h) Clause 22 — Penalty rates (i) Clause 24 — What is shiftwork (j) Clause 25 — Rate of pay for shiftwork (k) Clause 26 — Rest breaks and meal breaks (l) Clause 27 — Rostering restrictions (m) Clause 28.3 — Additional payment for annual leave (n) Clause 33.3 — Payment for work on a public holiday or substitute day
72	AHA	21	Overtime: AHA seeks to simplify clause 21.	Replace the factors for deciding if additional hours are reasonable or unreasonable with a note referring to s 62 of the FW Act and redraft clauses 21.1(a)–(d) as follows: 21. Overtime NOTE: Under the NES (see section 62 of the Act), an employee may refuse to work additional hours if they are unreasonable. Section 62 sets out factors to be taken into account in determining whether the additional hours are reasonable or unreasonable. 21.1 Payment of overtime a. An employer must pay a full-time, part-time and casual employee at the overtime rate for any time worked: i. In excess of 38 ordinary hours per week or, if working in accordance with a roster or averaging arrangement, in excess of 38 ordinary hours per week averaged across the averaging arrangement. ii. Outside the span of ordinary hours for each day (excluding shiftwork), subject to clause 15.2; 24. iii. In excess of 11 hours on one day of the week and in excess of 9 hours on any other day of the week. b. Overtime is calculated on a daily basis.
73	AWCC	21.2(a) and 15.6(a)	Payment of overtime: It is unclear whether leave hours and absences on a public holiday should be included when determining if a full-time employee is entitled to overtime for working more than 38 hours a week. This gives room for different interpretation (e.g. EPI Capital Pty Ltd [2023] FWC 841).	Change clause 15.6(a) as follows: 15.6(a) In each establishment an assessment must be made as to the kind of arrangement for working the average of 38 ordinary hours per week required for full-time employment that best suits the business of the establishment. For the purpose of determining whether overtime applies as per clause 21.2(a) ordinary hours refer to the ordinary hours worked, leave taken [] and absences on public holidays.
77	AWCC	28.3	Annual leave loading: Confusing title; clarity needed in payment options. This title is a considerable source of non-compliance according to AWCC Ltd’s research amongst payroll professionals and EmployTech.	Rename to ‘Leave Loading’ and simplify payment options as proposed below: 28.3 Leave Loading payment for annual leave (a) During a period of paid annual leave an employer must pay an employee an additional payment of Leave Loading in accordance with clause 28.3 for the employee’s ordinary hours of work in the period. (b) The additional payment [Leave Loading] is payable on leave accrued. (c) For an employee other than a shiftworker the additional payment [Leave Loading] is the greater of: (i) 17.5% of the employee’s minimum hourly rate for all ordinary hours of work in the period; or (ii) The employee’s minimum hourly rate for all ordinary hours of work in the period inclusive of penalty rates as specified in clause 22—Penalty rates. (d) For a shiftworker the additional payment [Leave Loading] is the greater of: (i) 17.5% of the employee’s minimum hourly rate for all ordinary hours of work in the period; or (ii) The employee’s minimum hourly rate for all ordinary hours of work in the period inclusive of penalty rates for shiftwork as specified in clause 25—Rate of pay for shiftwork.
78	NRA	28.3	Annual leave loading: There should be a default rate for leave loading where an employer is unable to determine the relevant weekend /shift penalties for a particular period of leave.	Vary clause 28.3 to outline that the 17.5% loading at clause 28.3(c)(i) applies by default where an employer cannot determine the relevant weekend / shift penalties.
79	AHA	29	Personal/carer’s leave and compassionate leave: AHA seeks to shorten clause 29 to make it more consistent with other modern awards.	Remove clauses 29.2–29.4, relating to casual employees, to avoid duplication of the NES.
80	MGA	Nil (new)	Optional templates for facilitative provisions: There is a need for additional templates similar to those in Schedules F and G for various clauses to facilitate easier application of these provisions.	Include new templates within the schedules to the award to assist employers and employees in applying facilitative provisions more effectively. Specifically, templates are requested for: a) clause 15.7(d): Rosters—minimum consecutive days off; b) clause 15.8(b): Employees regularly working Sundays; c) clause 16.6(d): Breaks between work periods; d) clause 19.11(b): Recall allowance; e) clause 21.3: Time off instead of payment for overtime.
81 (erroneously marked 182 in original)	AHA	Nil (new)	Salaries absorption: AHA seeks a salaries absorption clause that applies to managerial staff to afford further flexibility to those workers, including those seeking to balance work and personal circumstances.	Insert a new Salaries Absorption clause for Retail Employee Levels 6–8 equivalent to clause 25 of the Hospitality Industry (General) Award 2020, which provides a 25% loading on minimum rates in lieu of receiving some conditions and entitlements. Safeguards requiring a minimum eight days’ off duty each four-week cycle and time off for public holidays worked would be retained.

[1] [2024] FWCFB 197.

[2] [2024] FWCFB 251.

[3] [2024] FWCFB 302.

[4] Modern Awards Review 2023–24 (Report, 18 July 2024).

[5] Proposed variation K and the aspect of proposed variation L set out at item 22 of the schedule will be dealt with as part of the 2025 review of award provisions regulating part-time employment: ibid [167(3)], [167(6)].

[6] The AWCC’s original proposal, as written, was to reduce the requirement to four weeks’ written notice in all cases. However, it clarified at the relevant consultation that its intention was actually for the 13-week notice period to apply to all IFAs: transcript, 12 March 2024 PNs 640–662.

Printed by authority of the Commonwealth Government Printer

[2024] FWC 2163

15 AUGUST 2024