Fair Work Rights and Obligations

1. What is the Fair Work Act 2009 and why does it matter for my business?

The Fair Work Act 2009 is Australia’s principal workplace relations legislation. It sets out the minimum standards for employment, including the National Employment Standards (NES), rules around awards, enterprise agreements, unfair dismissal, and record-keeping. For any business that employs staff — even just one — you are generally required to comply with its provisions.

2. Who is covered by the Fair Work Act?

Most national system employees — full-time, part-time, casual, and fixed term — along with employers under federal jurisdiction are covered. Some contractors may also be included if their arrangement is essentially employee-like (i.e. “sham contracting”).

3. What are the National Employment Standards (NES)?

The NES are 11 minimum entitlements that apply to most employees. These include annual leave, parental leave, personal/carer’s leave, maximum weekly hours, redundancy pay, and more. They cannot be overridden by contracts or agreements that grant lesser rights.

4. How do Modern Awards and Enterprise Agreements work?

Modern Awards set industry- or occupation-specific minimum conditions such as penalty rates, overtime, and allowances. Enterprise Agreements are workplace-level agreements negotiated between employers and employees, approved by the Fair Work Commission, and must leave employees better off overall compared to the award.

5. What constitutes casual employment and can they convert to permanent?

A role is casual if there is no firm commitment to ongoing work. Employees who have worked regularly for 12 months, with a pattern in the last 6 months, may be eligible for conversion to permanent employment. Employers may need to offer conversion in many cases.

6. What record-keeping and payslip obligations must I follow?

Employers must issue payslips within one working day of payment and keep employment records for at least 7 years. This includes details of hours worked, leave, pay rates, superannuation, and deductions. Good record-keeping helps prevent disputes and compliance issues.

7. How do I calculate penalty rates, overtime, and allowances?

This depends on the relevant award or enterprise agreement, type of work performed, and timing (weekend, public holiday, shift work). Payroll systems and award interpretation services can help ensure accuracy.

8. What rights do employees have around dismissal, redundancy, and unfair dismissal?

Employees may have unfair dismissal protections if they meet eligibility rules. Dismissals must follow valid reasons and fair process. Redundancy pay may apply if roles are genuinely no longer required. Small businesses have additional guidance under the Small Business Fair Dismissal Code.

9. Can I vary an employee’s terms via a flexibility agreement?

Yes. Individual Flexibility Arrangements (IFAs) allow variations as long as the employee is better off overall, the arrangement is made freely, and it is in writing. Employers cannot coerce staff into signing an IFA.

10. How do legislative changes affect existing employment contracts?

When awards or laws change, you must comply with new minimum standards, even if contracts pre-date the change. Contracts that provide greater benefits can remain in place, provided they don’t conflict with updated legislation.

11. How can Allied Business Bookkeeping support my Fair Work & payroll compliance?

We help small businesses manage payroll compliance, award interpretation, leave calculations, and record-keeping. Our services ensure you meet Fair Work obligations, avoid underpayments, and stay compliant with changing legislation — letting you focus on running your business.

Join Us

Get access to exclusive support and training of your choice:

Services

View the Services Offered by Allied Business Bookkeeping.

Fair Work & Payroll FAQ