Industrial relations

Modern Award Interpretations are an essential part of a successful business environment

The first 122 modern awards commenced on 1 January 2010, coinciding with the introduction of the new national workplace relations system.

What are Modern Award Interpretations?

Award interpretation is the determination of the minimum legal pay for the number of hours worked in a specific period based on the legal agreement as outlined by the Fair Work Ombudsman.

The determination process includes the assessment of three basic features.

  • The base pay is the minimum, legal amount of remuneration employees earn within ordinary work hours. It is from this that you can calculate penalty and overtime rates.
  • Penalties and overtime: The extra pay awarded to employees based on services performed outside the standard work hours. This pay covers work done on public holidays, late nights, and weekends and usually has a higher rate.
  • Allowances: compensation to employees for any incurred expenses during work hours or undertaking work in unfavorable conditions. You can find the different allowances that apply to different businesses on the Fair Work website.

Parameters such as the employees’ hours, working specific hour sequences, and the specific outcomes when meeting those criteria need to be clearly understood. Other operational rules such as what would be considered a late or early start or a clear picture of the rules surrounding other features such as breaks are also necessary.

With proper consideration of the business rules, which are an amalgamation of the award interpretation rules with the operational rules, you can then produce an accurate assessment to highlight the fair compensation for your employees.

Understanding award interpretation is also critical in helping employers understand their obligations to their employees under the relevant modern award and ensuring that the employees receive their wages in a timely manner, that they are accurately calculated, and in full accordance with their entitlements.

For the employer, this is especially vital as incorrect award interpretation can be costly if you find yourself having to make back payments for incorrectly issued wages, and then have to pay the relevant penalties and fines.

So, What Is a Modern Award, Really?

The first modern awards were created as part of an extensive review conducted by the Fair Work Commission’s predecessor, the Australian Industrial Relations Commission (AIRC), following a formal Australian Government request.

They are enforceable documents that grant the same minimum pay rates and employment conditions to all the wage earners in the same occupation or industry.

The first 122 modern awards commenced on 1 January 2010, coinciding with the introduction of the new national workplace relations system.

You can find a list of all 122 awards on the Fair Work website.

Modern Awards Were Such a Good Idea!

Yes, they were, and yes, they are.

But that doesn’t mean that they are easy to work with and understand.

There can be so many variations in awards between companies and even between individuals within the same company that it becomes extremely important to set out the award interpretation properly from the outset.

Having a clear understanding of this system right from the award implementation phase and mapping out and understanding the rules is critical.


Today’s modern workplace is an everchanging and evolving environment. Couple this variations with constantly changing wage rates and award entitlements, and it becomes doubly important, and problematic.

Assurance HR includes Modern Award Interpretation as an important part of the range of professional services provided to businesses, both in Tasmania and across the country.

Not only can they provide your business with systems and documentation that are needed in relation to Human Resources, Industrial Relations and Workplace Health and Safety, they also offer personalised ongoing support to maintain this initial structuring into the future so that the business owner can get on with running their business.

For further information on Modern Award Interpretations, or any other area of your business where we can assist, please click the red button below and book a FREE one-to-one appointment with one of our professional consultants.



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From Our Principal


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Do they understand what you have to go through each and every day? We Do!

You see, before seeing the need that small businesses had in this area, I ran a successful small business for over 15 years.

I have been where you are. And with a team boasting similar experience totalling over 100 years, I can promise you we will not stand behind you, we will stand with you shoulder to shoulder, providing the best advice and support at a price the big companies will not match.

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+61 1800 577 515

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