In a finding handed down late Wednesday 03 November 2021, the Fair Work Commission has ruled that workers picking fruit on a piece-rate must be guaranteed a minimum wage under the Horticulture Award.
This finding was based predominantly on the argument that the existing piece-rate provisions under the Award were not being applied by growers in the way they were intended and, as such, allowed opportunity for grower exploitation. The full decision can be read here.
The key points of the decision and process at this point are:
- Submissions to the proposed draft variation are now open until Friday 26th November and can be sent to amod@fwc.gov.au
- There is no effective date set for the changes as yet – we expect this will be set once the submissions process has been completed
- While there a numerous differences between the current piece rate terms and the proposed draft variations, the key changes include:
- The crux of the decision is that, while piece-rates remain in the Award, there is now a requirement to ensure that all employees are paid at least the minimum hourly rate (including casual loading for casuals) for each hour worked.
- There is also the addition of a definition for ‘competent’ being a pieceworker who has at least 2 weeks’ experience performing the task.
- The need for ‘genuine negotiation’ in setting piece-rates has been removed, meaning that the employer can set the piece rates as long as they comply with the terms set by the Award.
What steps should businesses take?
At this point, it is important for growers covered by the Horticulture Award to be aware of this decision, although there are no definite changes to be implemented until the final variation is approved.
In the meantime, we recommend that businesses consider what the implications will be on their cost of production and begin to plan resourcing and pricing accordingly.