State reference public sector modern award or transitional arrangements resulting in reduction in take‑home pay
3CA.02 State reference public sector modern award or transitional arrangements resulting in reduction in take‑home pay
This regulation is made for subitem 8(1) of Schedule 2 to the Act.
Item 2 of Schedule 2 to the Act is modified by:
replacing ‘subitem 11(2)’ in the definition of take‑home pay with ‘subitems 11(2) and 16AA(2)’; and
replacing ‘subitem 12(1)’ in the definition of take‑home pay order, with ‘subitems 12(1) and 16AB(1)’.
Schedule 6A to the Act is modified by inserting the following Division after Division 3 of Part 2.
‘Division 3A—Avoiding reductions in take‑home pay from State reference public sector modern award or transitional arrangements
18A State reference public sector modern award terms giving FWA power to make take‑home pay orders
A State reference public sector modern award may include terms that give FWA power to make an order (a take‑home pay order) remedying a reduction in take‑home pay suffered by an employee or class of employees as a result of the making of a State reference public sector modern award or the operation of any transitional arrangements in relation to the award (whether or not the reduction in take‑home pay is a modernisation‑related reduction in take‑home pay).
An employee’s take‑home pay is the pay an employee actually receives:
including wages and incentive‑based payments, and additional amounts such as allowances and overtime; but
disregarding the effect of any deductions that are made as permitted by section 324 of the FW Act.
Deductions permitted by section 324 of the FW Act may (for example) include deductions under salary sacrificing arrangements.
This Division applies to an employee or class of employees to whom a State reference public sector modern award applies if the employee or employees are likely to suffer a reduction in take‑home pay attributable to the making of a State reference public sector modern award or the operation of any transitional arrangements in relation to the award.
18B Orders remedying reductions in take‑home pay
If FWA makes a take‑home pay order under the terms of a State reference public sector modern award it must do so in accordance with this Division.
Without limiting the kind of take‑home pay order that may be made under the terms of a State reference public sector modern award, one or more of the following orders may be made:
an order compensating a reduction in take‑home pay that has already been suffered;
an order requiring the payment of an amount of take‑home pay;
an order preventing a reduction in take‑home pay from occurring.
FWA may make a take‑home pay order only on application by:
an employee who has suffered a reduction in take‑home pay; or
an organisation that is entitled to represent the industrial interests of such an employee; or
a person acting on behalf of a class of such employees.
If FWA is satisfied that an application for a take‑home pay order has already been made in relation to an employee or class of employees, FWA may dismiss any later application that is made in relation to the same employee or employees.
18C Ensuring that take‑home pay orders are confined to the circumstances for which they are needed
FWA must not make a take‑home pay order in relation to an employee or class of employees if:
FWA considers that the reduction in take‑home pay is minor or insignificant; or
FWA is satisfied that the employee or employees have been adequately compensated in other ways for the reduction.
FWA must ensure that a take‑home pay order is expressed so that:
it does not apply to an employee unless the employee has actually suffered a reduction in take‑home pay; and
if the take‑home pay payable to the employee under the State reference public sector modern award increases after the order is made, there is a corresponding reduction in any amount payable to the employee under the order.
18D Take‑home pay order continues to have effect so long as State reference public sector modern award continues to cover the employee or employees
A take‑home pay order made in relation to an employee or class of employees to whom a particular State reference public sector modern award applies continues to have effect in relation to the employee or employees (subject to the terms of the order) for so long as the State reference public sector modern award continues to cover the employee or employees, even if it stops applying to the employee or employees because an enterprise agreement starts to apply.
18E Describing classes of employees
Without limiting the way in which a class of employees mentioned in items 18A to 18D may be described for the purposes of those items, the class may be described by reference to one or more of the following:
a particular type of employment;
a particular classification, job level or grade;
a particular entitlement;
a particular employer.
To avoid doubt, the description of a class is not required to include the names of the employees, or the number of employees, included in the class.
18F Inconsistency with State reference public sector modern awards and enterprise agreements
A term of a State reference public sector modern award or enterprise agreement has no effect in relation to an employee to the extent that it is less beneficial to the employee than a term of a take‑home pay order that applies to the employee.
18G Application of provisions of FW Act to take‑home pay orders
The FW Act applies as if the following provisions of that Act included a reference to a take‑home pay order:
subsection 675(2);
subsection 706(2).
For compliance with take‑home pay orders, see item 7 of Schedule 16.’
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