Annualised Salary Agreements

The advantage of the new annualized wage provisions is that, if properly met, there should be no underpayment, as you will have a record of all hours worked and the obligation to make up any shortfalls each year. There are no redundancy provisions for annual salaries that are implemented at the discretion of the employer. The Common Law, which has been de-accounted, does not erase monetary duties under modern allocation – the claims remain in force and remain payable. The annualized salary is paid for this premium. If the external limit of overtime/penalty hours were to be exactly the level of pay, it should be the result that there would never be a default to be filled in the voting. In other words, if the salary is calculated for a worker who works three hours of overtime per fourteen days and the external overtime limit is also set as three overtime hours per fourteen days, it should be deducted: (a) all hours worked in two weeks over three overtime hours are paid during the corresponding salary period; (b) the salary paid should be sufficient to cover hours worked (provided there are no additional allowances, penalty interest, annual leave, etc.). The Commission has clarified that an annualized salary can be implemented by the application of a cancellation clause in an employment contract and that this should not be done using annualised wage arrangements in a modern premium. The Commission also stated that the new annual wage provisions will not invalidate or settle contractual compensation. This means that the new obligations described above would not apply if the annual salary were implemented by a compensation clause in an employment contract and not by a modern allocation scheme. This decision applies only to bonuses that already contain an annualized compensation clause and replace it with one of three new clauses with additional requirements for employers. Sometimes it is still not enough to pay an arbitrary amount above the minimum premiums.

If the company is sure that the salary paid is sufficient to compensate the worker for all hours worked during each salary period, all premium rights may simply be placed in an employment contract instead of committing to the new premium rules. In other words, these annualized wage changes only affect the rights of workers who have set annualized wages based on the respective prices (and those who do not have formalized contracts). When employers have an annualized wage agreement with their employees, they must regularly review the incomes of their employees. In addition, 22 modern awards provide, from 1 March 2020, an additional option for the payment of an annual salary on the basis of the rules of the bonus (this does not, however, change the right to pay also by contract).