Am I Correctly Calculating the Wages for My Casual Employees?

We have recently received a number of enquiries from members questioning the calculation of the wages that they pay to casual employees, especially around overtime and penalty rates.

The employees working in the construction industry are likely to be covered by one of the modern awards, such as the Building and Construction General On-Site Award 2020 (MA000020). The relevant award regulates the employer’s relationship with its employees and stipulates an employee’s entitlements in most aspects such as wages, allowances and overtime. This is different for apprentices, full time, part time and casual employees and, as such, the award can be confusing.

Members are reminded that casual employees’ rates of pay are based on the ordinary hourly rate of pay. In the Building and Construction General On-site Award 2020 (the Award), ordinary hourly rate is defined as the minimum hourly rate for a full-time/part-time employee plus the industry allowance and any applicable all-purpose allowance. A casual employee’s minimum hourly rate is the appropriate ordinary hourly rate plus 25% of casual loading.

When calculating overtime for a full-time employee, the appropriate rate would be 150% or 200% of that employee’s ordinary hourly rate.

When calculating overtime or penalty rates, a casual employee would receive 175% or 225% of the ordinary hourly rate. Not 150% or 200% of the hourly rate that includes the 25% casual loading.

The Workplace Relations and Legal Team can review your wages if you are unsure if your calculations are correct. If you have any questions relating to employee wages, please contact our Workplace Relations and Legal Team on (02) 6175 5900.