This week the Fair Work Commission ruled on an application to remove ‘junior rates’, but there is more nuance to this than the headlines would indicate on first blush.
In June 2024 applications were made to the Fair Work Commission to abolish the discounted ‘junior rates’ that apply in three specific modern awards;
- General Retail Industry Award 2020
- Fast Food Industry Award 2020
- Pharmacy Industry Award 2020
Most modern awards include a discounted junior rate scheme that sees employees who are under the ‘adult’ age receive a percentage of the full adult rate. For example under the General Retail Industry Award a 17 year old staff member receives 60% of the adult rate. When the same employee turns 18 years of age that increases to 70% of the adult wage, and at 19 years it goes up again to 90% of the adult wage, and then at 20 years the employee is considered an adult by the award and receives 100% of the award rate.
The applications made by the Shop Distributive and Allied Employees Union (SDA) sought to ensure that all employees, regardless of age, receive 100% of the award rate.
After numerous hearings and submissions the Fair Work Commission yesterday announced its Decision in the case that ultimately determined that employees aged 18 to 20 should no longer be subject to “discounted” junior rates.
Terri Butler, deputy president of the Fair Work Commission, said in making the decision, it considered whether there was any difference in the value of work performed by junior employees and other employees in the same classifications under the same awards.
“We have been particularly interested in the extent to which junior rates serve or do not serve the interests of children and young people,” she said.
“Young teenagers who are trying to get their first job usually wanting to balance work with secondary education, can benefit from being able to accept discount rates compared with older people doing the same job.”
What has changed?
The Decision from the Fair Work Commission will mean that 100% of the adult rate will apply to work done by those that are over 18 years of age, once they have served 6 months with the employer.
There are transition arrangements in place that will see the rate increase in increments over 4 years;
What this means for the fuel industry?
“It is important to understand that the changes to the junior rates are confined to the three awards, and that none of those three awards apply to the wholesale, distribution or retail of fuel. So the impact on the fuel industry of this Decision is none”, explained ACAPMAs Elisha Radwanowski.
“At least for now. It is possible that the Fair Work Commission may, either on application or on its own, choose to extend the coverage to other awards, but for now there is no impact on fuel retailers or the broader fuel industry”, notes Elisha.
More Information
View the whole Decision from the Fair Work Commission here – https://www.fwc.gov.au/documents/sites/am2024-24/2026fwcfb75.pdf
Here to Help
HR Highlights are things to consider, implement and watch out for in your business.
They are provided as general advice and you should seek further advice on your situation. Members can do this by emailing employment@acapma.com.au.
ACAPMA Membership is affordable at only $860 per year for a single site and valuable with sites gaining HR advice support and representation as well as a raft of other benefits and discounts. Click here to learn more about ACAPMA Membership.
Elisha Radwanowski BCom(HRM&IR)
ACAPMA
