Transitional casual loading: have we underpaid workers?

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Transitional casual loading: have we underpaid workers?

If a transitional casual loading in our agreement was less than a prescribed loading, could our casual employees have a valid claim for underpayment?

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If a transitional casual loading in an agreement was less than a prescribed loading, could our casual employees have a valid claim for underpayment?
 
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Q Our company operates under an enterprise agreement with a nominal expiry date at the end of November 2014. The agreement started on December 2011 and the company employs a number of casual employees.
 
The agreement provides a casual loading of 22 per cent, which was the relevant transitional casual loading under the production award at that time and passed the Better Off Overall Test (BOOT).
 
If the agreement was not in operation, our production employees would be covered by the Manufacturing and Associated Industries and Occupations Award 2010. From 1 July, the transitional arrangements cease under the award and the casual loading will be 25 per cent for all employees.
 
We are concerned the company may be liable for the difference between the transitional casual loading (22%) and the prescribed casual loading (23-25%), since the agreement came into effect. Would our casual employees have a valid claim for underpayment of the casual loading over the past three years?

A No. The minimum wage for the relevant classification under the modern award overrides the wage rate in an agreement where there is an inconsistency, otherwise, all other terms of a modern award do not apply.
 
The minimum provisions of the National Employment Standards (NES) also override the provisions of an enterprise agreement if the NES is more beneficial. The minimum wage rate does NOT include the casual loading under the award, nor do any amounts, such as work-related allowances.
 
The casual loading under the enterprise agreement will continue to apply until the agreement is terminated or replaced.
 
However, any proposed new agreement will be required to pass the ‘Better Off Overall Test’ (BOOT), where the casual loading (25%) would be included in the overall comparison between the proposed enterprise agreement and the applicable modern award.
 


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