Employee Management a la Calombaris
George Calombaris is used to the spotlight as a Masterchef celebrity judge. But recently, he’s been in the spotlight for more unsavoury reasons, namely underpaying his employees across several restaurant chains. As a judge, he paid great attention to the ingredients of the meals dished up for him to sample. However, as a businessman his recipe for managing the employment relationship was missing some fundamental ingredients.
Ingredient 1: Know which modern award applies to your employees.
Modern awards apply to the employment of a significant portion of Australia’s workforce and along with the National Employment Standards, form the minimum conditions of employment for a wide range of industries and occupations. Determining the correct award that applies to your organisation or particular groups of employees is essential to ensure that you do not breach your minimum employment obligations.
Ingredient 2: Pay your employees the right amount.
It is unlawful for an employer to pay below the minimum rates specified by the relevant modern award. You also need to ensure you comply with award provisions for overtime, allowances, loadings and penalty rates that may apply depending upon an employee’s pattern and hours of work. Mr Calombaris discovered this the hard way when the Fair Work Ombudsman found some of his casual employees had been short-changed by a failure to correctly apply award entitlements to casual loading, minimum engagement and penalty rates.
Ingredient 3: Check ‘set off’ arrangements meet minimum obligations.
Some employers choose to pay their employees a ‘set off’ rate of pay in compensation for anticipated loadings, overtime, allowances, penalty rates and any other entitlements that are otherwise payable in accordance with the relevant award. For Mr Calombaris’ chain of restaurants, salaried employees employed under the Restaurant Industry Award 2010 were paid a 25% loading for the purpose of ‘setting off’ award entitlements. Unfortunately, the loading still failed to meet the minimum obligations when factors such as overtime, working through meal breaks and annual leave loading were taken into consideration.
Caution should always be taken when paying employees an amount to ‘set off’ entitlements. Modern awards have strict requirements to ensure that salaried employees aren’t paid less than their minimum entitlements and aren’t dished up a half-baked rate of pay.
Ingredient 4: Know when to ask for expert assistance
This is an ingredient that Mr Calombaris did pay attention to, but unfortunately only when there was already smoke in the kitchen. It’s not always easy to determine which modern award covers your employees, and their correct application is rarely straightforward. Thankfully, CCER is here to help with all your modern award enquiries no matter how great or small, because often having the right mix of ingredients is just as important as knowing how to use them.
Stephen Noone is an Employment Relations Specialist at CCER.