Fair Work Australia makes first take home pay order to retail worker

Australia’s industrial umpire, Fair Work Australia, has made its first take-home pay order, ordering women’s fashion retailer Fast Future Brands to provide a female staff member with nine months of back pay.

Take-home pay orders were introduced as part of the Rudd/Gillard Government’s Fair Work industrial relations regime, and more specifically the introduction of national, Modern Awards.

While the Modern Awards resulted in pay rates falling in some states, employers were not allowed to pay employees less than there were receiving under their previous award. If this occurred, Fair Work Australia could make a take-home pay order and effectively top-up the worker’s pay.

Fair Work Australia’s first take-home-pay order was handed down by senior deputy-president Les Kaufmann in a case involving Sydney-based retailer Fast Future Brands – owners of the Valleygirl and TEMPT chains – and a female employee, Susan Balog.

According to Kaufmann’s decision, Balog only worked on Sundays for three or four hour shifts, owing to her situation as a single parent of two children and a full-time student.

Under the new Modern Award, which came into effect on January 1, Balog’s hourly rate fell from $19.83 to $16.47. When a 200% loading for Sunday work was taken into account, take-home hourly rate fell from $39.66 to $32.94.

“It is apparent that the take-home pay of the applicant for working on a Sunday has decreased by an amount of $6.72 per hour, inclusive of the 200% loading,” Kaufmann wrote in his judgement.

While Fast Future Brands said it was simply complying with the new Award, and had offered to give Balog more hours to make up for her lower pay, Kaufmann was unmoved.

“While I accept that the employer did not wish to decrease the applicant’s take-home pay, and thus offered her additional hours, I do not accept that the offer is acceptable as an alternative to a take-home pay order. The employer, in essence, is seeking that the employee work more hours for less pay.”

Fast Future Brands was contacted for comment but representatives were not available prior to publication.

While the amount of money involved in the take-home pay order is relatively small – less than $1,000 – the fact that it is the first such order from Fair Work Australia should serve as a warning for employers who are wrestling with the Modern Awards process.

While lower pay rates under the Modern Wards can be applied to new employees, existing employees must not be left worse off.