HRMT20027 - Employment Relations: Modern Awards Review Effectiveness

This essay provides a comprehensive analysis of the role and effectiveness of the Fair Work Commission in reviewing modern awards within the Australian employment relations system. It begins by defining modern awards and their significance in providing minimum employment conditions, contrasting them with the National Employment Standards. The essay traces the historical context of the awards, highlighting the Rudd Government's initiative and the subsequent award modernization process. It then examines the impact of these awards on employee-employer relations, emphasizing their role in mitigating industrial disputes by guaranteeing minimum entitlements and promoting a healthier workplace environment. Furthermore, the essay explores the Fair Work Commission's responsibility in reviewing these awards, as mandated by the Fair Work Act 2009, and assesses the commission's performance in this review process. It references relevant literature and provides a detailed overview of the modern awards and their review by the Fair Work Commission.

Employment
Relations
Running Head: EMPLOYMNET RELATIONS 0
Student’s Name

EMPLOYMNET RELATIONS 1
A modern award refers to a document which includes minimum conditions related to
employment of an employee, that too on top of the National Employment Standards. This is a
new concept in the area of employment which came into effect from 01st January 2010. As
mentioned above, such awards consist of provisions and minimum terms and conditions
regarding many of the factors such as wages/pay, allowance, breaks, overtime, penalty rates,
rosters and hours of work (Fairwork.gov.au, 2019). As all these factors are very significant for
employer as well as employee, the subjective awards play a very crucial role in the management
of employment relations. Modern awards are applicable to every employee that are covered
under the national workplace relations system. For different industries, different awards are
there. The lead motive behind the development of these awards is to provide a minimum safety
net to all the employees of the national system. Currently, 122 awards are there in the countries
which are developed and applied to different industry. Employers may also developed their
enterprise agreement/ registered agreement with their employees. Here this is also required to
mention that if there is registered agreement developed between employer and employee, such
awards are not applicable if that registered agreement provides a better situation to employees.
In order to check the reason of the development and existence of modern awards, this is
to state that total 10 national employment standards (NES) are there under the fair work Act
2009 (Cth). No employer of Australia can offer less favourable treatment to his/her employees
than the required one under NES or federal minimum wages. Nevertheless, NES and federal
minimum wages do not provide a complete picture always. For instance, NES provides that a
full-time employee can work for 38 hours a week but do not provide other elements such as
timing, meal breaks, and penalties and so on. To cover all these aspects, modern awards were

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required to be developed (Hrassured.com.au, 2019). These awards ensure additional minimum
entitlements of employees that NES and federal minimum wages do not cover (Stewart, 2018).
It is also necessary to understand how these awards originated in Australia. This is to say
that the Rudd Government, following its elections in 2007, directed the Australian Industrial
Relations Commission to review the existing awards. Further, the government also directed the
commission to create a new set of awards if required. The process of award modernisation began
in the month of March 2008. As directed, commissions reviewed approximately 1500 awards
and the same has developed 122 modern awards. These awards came into effect from 01st
January 2010 (Actu.org.au, 2019). The contents of modern awards have been taken from various
states and territory awards. In the process of review of existing awards and development of new
awards, unions were involved. It was the belief of unions that these awards would provide better
conditions to employees that have proven correct. In many of the cases, the review of awards has
resulted in the favor of employees. In this manner, modernisation of awards has been taken place
in Australia.
Employee-employer relations are really important to be healthy for better outcomes out
of a job. Industrial disputes are the situation where the interest of employer and employee
conflicts with each other. When the employer does not fulfill the demands of the employee, the
later party often feel stress and demotivation. It affects their performance and creates their
conflicts with the employer. Modern awards play an important role here. As mentioned above
these awards provides minimum guaranteed entitlements to employees. Employers have to
provide these entitlements to employees which reduce dissatisfaction in employees. These
awards remove the main reason for disputes and develop a healthy relationship between the
parties of employment relations. In conjunction with this, these awards also have different aspect

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while evaluating the impact on employment relations. Because of these awards, employees got
right of a break, fixed shift hours and minimum wages. Further the same contains the provisions
of consultation. All these entitlements make them happy and they become more efficient for their
employers. In such a situation employers also remain happy with the performance of their staffs.
Therefore this would not be wrongful to state that modern awards reduce tension between
employer and employee and make their relationship smooth. In this manner, these awards seem
to be very effective in their role.
Only the development of modern awards is not enough but the same are required to be
reviewed on different intervals. Fair Work Act 2009 play an important role here. This act
imposes the responsibility of review of these awards on Fair wok commission. As per section
156 of the act, the commission is required to review all the modern awards in the gap of every 4
years (Floyd, Steenson, Coulthard, Pickering & Williams, 2017). The commission will start its 4
years after 01st January 2014. The lead role of commission here is to check whether these
awards are successful in their objectives or not and whether there is a requirement to make the
changes in the same. Section 156 of the Fair Work Act states some responsibility for this act
which further imposes the same on Fair work commission. It means the commission is required
to ensure the elements mentioned under section 156 of the subjective act. In the first review, the
commission reviewed the awards as desired and highlighted many of the issues which demand
changes. It includes casual conversion, excessive annual leave accruals, and other annual leave
changes. Further penalty rates in fast food, hospitality, retail and pharmacy industry also been
amended (Awardviewer.fwo.gov.au, 2019) The first schedule of the review was expected to be
complete by end of 2018 but because of the long process of review, the commission has deferred
the second schedule until the wrap of the first schedule (Booth, 2018). Although the commission

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was delayed but one cannot put the question mark on the effectiveness of commission in
reviewing these awards. Commission acted well in its role and been effective too.

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References
Actu.org.au. (2019). Modern Awards. Retrieved From: https://www.actu.org.au/our-work/policy-
issues/modern-awards
Awardviewer.fwo.gov.au. (2019). [2017] Fwcfb 3001 Fair Work Commission Decision.
Retrieved From: http://awardviewer.fwo.gov.au/award/link/PR593392
Booth, S., (2018). Australia: Keeping up with modern awards. Retrieved From:
http://www.mondaq.com/australia/x/699068/employee+rights+labour+relations/
Keeping+up+with+modern+awards
Fair Work Act 2009
Fairwork.gov.au. (2019). Modern awards. Retrieved From: https://www.fairwork.gov.au/how-
we-will-help/templates-and-guides/fact-sheets/minimum-workplace-entitlements/
modern-awards
Floyd, L., Steenson, W., Coulthard, A., Pickering, A. & Williams, D. (2017). Employment,
Labour and Industrial Law in Australia. USA: Cambridge University Press.
Hrassured.com.au. (2019). Modern Awards. Retrieved From:
https://www.hrassured.com.au/guides/modern-awards/
Stewart, A 2018, ‘Chapter 7: Minimum standards: The NES and awards’, in A Stewart, Stewart’s
guide to employment law, 6th edn, The Federation Press, Sydney, CQUniversity Course
Resources Online (HRMT20027).