Australia is currently undergoing a review of its common rule Modern Awards. The Modern Awards were introduced in 2010 and are required to be reviewed by the Fair Work Commission (“FWC”) every two years. The review commenced on 1 January 2012 and will encompass 122 different Modern Awards, staggered over four stages. As part of the process, the FWC will hear applications to change or vary existing Awards and make decisions based on those applications. The Commission has already made orders to vary certain awards, including the Clerks-Private Sector Award 2010 and the Black Coal Mining Industry Award 2010, among others.

Separately, the Prime Minister, Julia Gillard, announced during a speech she gave on 14 March 2013 that the Federal Government will amend the Fair Work Act 2009 to enshrine penalty rates, overtime, shift work loading and public holiday pay when Modern Award rates and conditions are set in Modern Award.

Less than a week after the Government’s announcement, the FWC handed down a highly anticipated decision refusing to reduce Sunday penalty rates in the hospitality and retail industries. Although the FWC Full Bench recognised that the employers were faced with high Sunday penalty rates compared to Saturday rates, it was of the view that the evidence was not compelling enough to warrant variations to those Modern Awards under review. This decision follows the applications made by numerous employer groups to modify the penalty rates and loadings in the General Retail Industry Award, the Fast Food Industry Award, the Hospitality Industry (General) Award, the Food, Beverage and Tobacco Manufacturing Award and the Hair and Beauty Industry Award 2010. The FWC Full Bench will continue to hear matters relating to multiple awards, including a hearing in April regarding annual leave. We will keep you posted of any further key developments in the Modern Award review.