Following our article last year about reasonable hours, it is critical that whilst an annualised salary does not have to operate under the award,  the arrangement must pass the BOOT – the Better Off Overall Test. It’s a good idea to schedule an annual check to ensure your employees still pass the BOOT.

A recent Federal Court decision outlines an example of not passing the BOOT.

The National Employment Standards (NES) impose an obligation on employers to not unreasonably require full-time employees to work more than 38 hours a week.

The employee’s offer and contract of employment stated:

Hours:    The ordinary work hours for a full time week are 50 hours per week. Your ordinary work hours will initially be within the range 2 am to 11:30 am Monday to Friday, 2 am to 7 am Saturday. This may at some stage in the future need to be varied from this range due to business requirements.

Additional Hours:    There is the expectation that when requested by the Company employees shall work a reasonable amount of additional hours.

As the Court noted there was no mention of what the employee would be paid or their entitlement to overtime.  The Court also found that on the face of this evidence the employee was not paid overtime for work outside the spread of hours or for work in excess of 38 hours.

The Court found the additional hours requested by the employer were unreasonable because of the following factors:

• The risk to the employee’s health and safety from working the additional hours working in an abattoir very early in the morning.
• The employee’s personal circumstances were that he was a recent immigrant with a new born child and little knowledge of Australian law.
• The employer failed to provide a Fair Work Information Statement (a compulsory requirement under the NES) which would have provided some explanation of the employee’s basic rights.
• The employee was entitled to receive, but was not actually paid, overtime or penalty rates for, or remuneration reflecting an expectation of, working additional hours.

The Court has not yet awarded damages or penalties against the employer but will no doubt do so in due course. 

As an employer, you do not want to get these things wrong.  We can help and advise you on the requirements for new employees coming into your business and how to deal with additional reasonable hours and overtime. 

To make a time to discuss offers of employment, contracts of employment and annualised salaries or any aspect of employment law, send us an email or call 07 3220 1144.