STATEMENT

Fair Work Act 2009
s.156—4 yearly review of modern awards

4 yearly review of modern awards—Payment of wages
(AM2016/8)

4 yearly review of modern awards – common issue – payment of wages – draft variation determination comments

[1] On 20 May 2020 the Full Bench issued a decision 1 stating that draft variation determinations for various awards would be issued shortly.

[2] On 22 May 2020 the following draft determinations 2 were published:

•  Black Coal Mining Industry Award 2010;

•  Meat Industry Award 2020;

•  Mobile Crane Hiring Award 2010;

•  Nurses Award 2010;

•  Passenger Vehicle Transportation Award 2020;

•  Plumbing and Fire Sprinklers Award 2010;

•  Road Transport and Distribution Award 2020;

•  Road Transport (Long Distance Operations) Award 2020;

•  Seafood Processing Award 2020;

•  Vehicle Manufacturing, Repair, Services and Retail Award 2020 (the Vehicle Award); and

•  Waste Management Award 2020.

[3] Interested parties were invited to comment on the draft determinations by 4pm on Friday 29 May 2020.

[4] The following submissions were filed:

•  Motor Trade Organisation (MTO) on 29 May 2020 in relation to the Vehicle Award; and

•  Australian Industry Group (Ai Group) on 1 June 2020 in relation to the Vehicle Award.

[5] No submissions were filed in respect of any of the other draft variation determinations. Final variation determinations in respect of these awards will be issued shortly.

[6] The MTO and Ai Group’s submissions and proposed amendments are directed at three aspects of the Vehicle Award draft determination.

(i) Clause 17.6(a)

[7] MTO submits that clause 17.6(a) should be amended to add the following words:

Subject to clause 17.6 (b), the employer must pay an employee no later than 7 days after the day on which the employee's employment terminates.

[8] The MTO states that clause 17.6(b) sets out an exception to the 7-day period for payment of wages in clause 17.6(a) for persons principally employed to perform vehicle sales related duties. This exception was agreed by the parties as these employees may not be entitled to commissions at the date of termination. Payment of commissions under clauses 28.4 (e) and (f) of the Vehicle Award depends on the time of delivery of vehicles which have been sold by an employee prior to termination.

(ii) Clause 17.6(a)(ii)

[9] Ai Group submits that although proposed clause 17.6(b) and current clause 28.4(f) of the Vehicle Award provide an intention that the 7-day timeframe from termination does not apply to commission payments, they are not explicitly excluded from clause 17.6(a). Ai Group propose the following amendment:

17.6 Payment on termination of employment

(a) The employer must pay an employee no later than 7 days after the day on which the employee’s employment terminates:

…

(ii) Except where otherwise provided, all other amounts that are due to the employee under this award and the NES.

[10] Ai Group states that while it may be clear that there are different timeframes applicable for commission payments in respect of vehicles delivered prior to termination (as is clear from proposed cl. 17.6(b)), no signpost is included regarding commission payments for vehicles delivered on or after termination which are dealt with in cl. 28.4(f). Ai Group submit that its proposed variation signifies that not all amounts relevant to payment on termination are dealt with in clause 17.6(a).

(iii) Clause 17.6(b)

[11] Ai Group submits that it is unclear when a commission payment ‘becomes applicable’ as these words no not appear elsewhere in the Vehicle Award. Ai Group proposes that the draft determination be amended to clarify that the 7-day period for commission payments to which an employee becomes entitled after the date of termination should commence from the delivery date of the vehicle and submits that clause 17.6(b) should be amended as follows:

‘Where a person principally employed to perform vehicle sales related duties is entitled to commission payments at a later date than the date of termination, those payments will be payable within 7 days of becoming applicable the delivery of the vehicle.’

(iv) Clause 17.6(b) NOTE 2

[12] The MTO submits that the reference to clause 17.6(b) in NOTE 2 should be amended to read clause 17.6(c) which ties in with the requirement to ‘pay wages and other amounts’ being subject to a further order of the Commission under clause 17.6(c).

[13] Ai Group also suggests the same amendment in their submission. 3

(v) Clause 17.6(c)

[14] Ai Group submits that clause 17.6(c) restricts the Commission’s capacity to provide relief to amounts dealt with under clause 17.6(a). As clause 17.6(a) pertains to amounts due to an employee within 7 days of termination, it is likely that commission payments would be unfairly excluded from the application of this provision.

[15] Ai Group proposes that clause 17.6(c) be varied to ensure that the Commission is able to provide appropriate relief in respect of commission payments, as follows:

The requirement to pay wages and other amounts under clause 17.6(a) clauses 17.6(a), 17.6(b) and 28.4(f) is subject to further order of the Commission and the employer making deductions authorised by this award or the Act.

Next Steps

[16] The amendments proposed by the MTO and Ai Group will be the subject of a conference before Deputy President Clancy.

PRESIDENT

Printed by authority of the Commonwealth Government Printer

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 1   [2020] FWCFB 1131

 2   Schedule of draft determinations

 3   Ai Group submission, 1 June 2020, paragraph [19]