This E-Alert addresses important changes to the Building and Construction General On-site Award that take effect from 1 July 2020. Both employers and employees should note the changes. Employers should ensure they are implemented from the first full pay period after 1 July 2020.
A key change is that the industry allowance has been amended to reflect a single industry allowance. A number of complex industry, disability and expense related allowances have been removed in the Award. This includes the removal of the special allowance. The industry allowance has been increased to compensate for the removal of these allowances. The rate for the industry allowance is based on the relevant construction sector. There is one rate for the commercial building industry and a second for the residential building industry. From 1 July these allowances are 6 per cent (commercial) and 4.8 per cent (residential) of the employee’s weekly standard rate of pay. Employers should read the new Award carefully, as there are still additional allowances that remain payable.
The tool allowance has also been revised to make it clear that employees are entitled to the allowance to cover maintaining their existing tools, not just purchasing new tools. Employees are also now entitled to be reimbursed for steel capped boots they are required to wear.
A significant change relates to the travel allowance employees receive. This allowance is normally $17.43 per day. Employees will now only receive this allowance, where they:
- start and finish their work day on a construction site; or
- are required to perform prefabricated work in an open yard and are then required to erect or fix the pre-fabricated materials on-site.
Employees will no longer receive the travel allowance if they are provided with or offered free transport from their home to work and return by the employer or provided with a fully maintained vehicle. Employees will also no longer get the allowance on days they do not work, like on an RDO or leave day.
A snapshot of some of the other changes include:
- Living away from home – distance work – The Award amendments clarify an employer’s obligations in relation to this allowance. There are now clear options as to how entitlements are to be provided and how meal expenses can be reimbursed.
- RDOs – The Award now provides greater flexibility in relation to RDOs. This includes allowing for the banking of RDOs and allowing an agreement to be reached between the employee and employer as to how and when an RDO is taken.
- Ordinary Hours of work – Ordinary hours of work for part-time and casual employees have been capped at 8 hours per day.
- Time off in lieu – The Award now allows an employer and employee to agree to take time off instead of being paid for overtime that has been worked. This ability is not open to all employees covered by the Award and the Award contain a number of safeguards that need to be met to use the provision. Employers should read the provisions carefully before implementing these arrangements.
- Payment of annual leave – The Award now simplifies how annual leave loading is to be calculated.
- Simplified provisions – a number of provisions have been simplified and redrafted, including those mentioned above.
Employers should familiarise themselves with the proposed changes to ensure that from the start of the first full pay period on or after 1 July 2020, their employees are being paid correctly and in line with any amendments to the Building Award.
In addition to this, the Fair Work Commission has announced a 1.75% increase to minimum wages. This will apply to all award wages. For awards operating in the construction industry, this increase will take effect from 1 November 2020.
The ABCC’s OnSite app is a great resource which puts information about wages and entitlements at your fingertips where you need it most, on site.
The guidance about travel allowance has been revised. If you have any questions regarding the payment or receipt of travel allowance, please contact the ABCC to discuss your particular circumstances.