Circular 2016/4W: Making of the Australian Government Industry Award 2016

Published

The purpose of this circular is to inform Commonwealth agencies of the introduction of the new Australian Government Industry Award 2016 (industry award).

The industry award does not cover employees of the Commonwealth engaged under the Public Service Act 1999.

  1. The industry award was made by the Fair Work Commission and came into effect on 15 August 2016.
  2. It replaces a number of transitional awards that previously applied to many non-APS, Commonwealth employees.
  3. The Australian Government Employment – Conditions and Salaries Award 1998, the award that historically set terms and conditions for non-APS employees, has been terminated.
  4. The impact on the current round of Commonwealth public sector bargaining is expected to be minimal.

Overview of changes

  1. The industry award reduces a significant number of agency-specific awards that previously applied to non-APS employees.
  2. It sets a safety net relevant to Commonwealth employment, incorporating modernised flexibility and consultation terms.
  3. The award maintains almost all of the terms and conditions provided to existing employees under their old award.
  4. The key changes include:
    1. An increased casual loading from 20 per cent to 25 per cent;
    2. Personal/carer's leave accrues progressively consistent with the National Employment Standards;
    3. Annual leave loading has been rolled into base salary;
    4. A significantly rationalised classification system;
    5. Exclusion of senior management employees, those employed in positions equivalent to the APS Senior Executive Service classifications;

Relationship to agency enterprise agreements

  1. The Australian Public Service Commission's general assessment is that for most agencies, the new minimum safety net will have little or no effect on the assessment of agreements under the better off overall test.
  2. In the main, salary rates in enterprise agreements are well above the award rates. This provides reasonable latitude for agencies in bargaining to reduce certain award conditions in exchange for other benefits.
  3. However, each agency agreement differs in its relationship with conditions in the Award. Agencies, including those that employ under common law contracts, should satisfy themselves that their employees' entitlements are equal to or more generous than those provided in the award.
  4. When making an application to the Fair Work Commission for the approval of an enterprise agreement, employers must provide a statement indicating how employees will be better off overall in comparison to the Award.

Further information and advice

  1. For further information about the new Award and its application, please contact the Australian Public Service Commission at workplacerelations@apsc.gov.au.
  2. General information on Awards is available from the Fair Work Commission website at: https://www.fwc.gov.au/awards-and-agreements/awards/modern-awards.

Marco Spaccavento
Group Manager, Workplace Relations
16 August 2016

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