There is a change to the award system that may affect your employees, effective March 1st.

As you may have seen in the press about this update from the Fair Work Commission.

These new rules affect all employees who are paid an annual wage under some awards.

This does not apply to Part-Time or Casual employees because they are paid on an hourly basis


In summary, The Fair Work Commission states: 

“Employers need to make sure each employee’s annual wage is high enough to cover the award entitlements”. 

The annual wage must include:

    • Minimum Wages, plus
    • Allowances, plus
    • Overtime & Penalty rates, plus
    • Leave loading

In essence, the Annualised wage must not disadvantage employees.

Who does this affect in churches?

There are many awards included in this change (see the links below). 

One that affects many churches is the Clerks—Private Sector Award 2010.

There are several important steps to understand and work on. Please see below the links to the Commission  for more detail.

Implement HR procedures Now.

Where an annualised wage is paid the employer must:

    • advise the employee in writing, and 
    • keep a record of:
    • the annualised wage that is payable;
    • which of the provisions of this award will be satisfied by payment of the annualised wage;
    • the method by which the annualised wage has been calculated, including specification of each separate component of the annualised wage and any overtime or penalty assumptions used in the calculation; and
    • the outer limit number of ordinary hours which would attract the payment of a penalty rate under the award and the outer limit number of overtime hours which the employee may be required to work in a pay period or roster cycle without being entitled to an amount in excess of the annualised wage in accordance with clause

Implement Payroll work records Now

The employer must keep a record of:

    • the starting and finishing times of work, and
    • any unpaid breaks taken, and 

This record must be signed by the employee,  or acknowledged as correct in writing (including by electronic means) by the employee, each pay period or roster cycle.

How to record these time and attendance details

At present, Xero’s timesheet system does not allow for the recording of start and finish times. Therefore, these records must be recorded in Excel or a 3rd Party timesheet system. From our discussions with other Xero partners, the following 3rd party apps are recommended to track time & attendance

These charge between Free (for one user) and $4 per user per month. 

Regular Payroll

If in a pay period or roster cycle an employee works any hours in excess of either of the outer limit amounts such hours will not be covered by the annualised wage and must separately be paid for in accordance with the applicable provisions of the award.

Reconciliation of annual wage

Reconciliation must be completed by the employer

    • each 12 months from the commencement of the annualised wage arrangement, or
    • upon the termination of employment of the employee 


    1. calculate the amount of remuneration that would have been payable to the employee under the provisions of this award over the relevant period and 
    2. compare it to the amount of the annualised wage actually paid to the employee. 


    • where the latter amount (2) is less than the former amount (1), ie a shortfall, and
    • the employer must pay to the employee the amount of the shortfall within 14 days.

For more information

Click here for the full clerical award

Click here for the details of the Clerks award 

Church specific

If you need more information about this please talk with the HR staff at your denominational head office.