Fair Work Australia: Purpose, Priorities and Modern Awards

When it comes to managing your workforce, staying on top of your legal obligations is crucial. One of the key pieces of legislation you need to be familiar with is The Fair Work Act 2009 (FW Act). This Act outlines your responsibilities and sets the framework for how work should be structured and managed in Australia.

Fair Work Australia is the body that oversees the Act – but what else do they do, and why is it so important for employers and employees?

Let’s dive into how Fair Work Australia shapes our workplaces.

What is Fair Work Australia? 

The Fair Work Act (FW Act) is the legislation governing Australia's employment relations system. The FW Act lays out the minimum workplace entitlements and obligations that the majority of Australian employees are entitled to. 

The FW Act has established two independent government organisations to manage the system: the Fair Work Ombudsman (FWO) and the Fair Work Commission (FWC). Together they play a key part in regulating the Act, and are often referred to as ‘Fair Work Australia’.

What is the Fair Work Commission? (FWC)

The FWC sets the national minimum wage as well as the minimum wages in modern awards (we’ll talk more about these in a moment). They help resolve work issues and approve enterprise agreements.

What is the Role of Fair Work in Australia? 

Fair Work – or the Fair Work Ombudsman and the Fair Work Commission – regulate the FW Act. They help relationships between employees and the majority of private-sector employers. The Act provides a safety net to make sure employees have minimum entitlements, from the minimum wage and employment entitlements, to modern fair work award rates and the National Employment Standards (NES).

The Fair Work Act:

• Facilitates flexible working arrangements
• Protects against unfair dismissals
• Ensures employees are treated fairly and protected against discrimination
• Provides rules for minimum pay, leave entitlements, notice periods and more

What is the Fair Work Ombudsman (FWO)? 

The FWO was established as a separate government agency by the FW Act 2009. It has offices all over Australia, both in capital cities and regional areas.

Currently, Anna Booth is the Fair Work Ombudsman (FWO) and head of the agency, and is supported by staff who help give advice to employers and employees, and make sure that workplaces comply with the Act.

What Does the FWO Do?

The Fair Work Ombudsman’s goal is to create better workplaces across Australia by helping everyone understand and follow the rules. Think of them as your workplace guide –  they can help you navigate the sometimes tricky world of workplace relations, whether you’re an employer or an employee. They do this by:

• Providing an easy-to-access source for accurate and up-to-date information on Australia's workplace relations system
• Teaching Australian workers about fair work practices and their rights
• Figuring out if there was a violation of workplace laws, Fair Work awards or registered agreements
• Going to court to enforce laws and to deter people from doing the wrong thing at work
• Building relationships with industry organisations and unions

How Do They Do It?

The FWO makes sure that employees receive their entitlements and helps businesses meet their legal obligations. Their team enforces the rules and awards Fair Work Australia has established by:

• Providing clear, practical interpretations of Fair Work Australia guidelines to help businesses understand their obligations
• Operating a dedicated helpline where employers and employees can get guidance
• Conducting workplace visits to make sure employers are complying with awards Fair Work Australia has set, and to address any issues
• Working collaboratively with industry groups and unions to promote an understanding of Fair Work award requirements and employment agreements

Additionally, Fair Work Inspectors are appointed to investigate and enforce workplace laws and making sure that employers adhere to:

• The Fair Work Act, including employment terms and conditions
• The National Employment Standards
• The Independent Contractors Act provisions
• Enterprise agreements and other industrial instruments
• Modern awards, including Fair Work awards that apply to different industries

What Are the Fair Work Priorities for 2025? 

The Fair Work Ombudsman (FWO) has set its key priorities for 2025, aiming to ensure workplaces are following Fair Work awards and workplace rules. These priorities focus on:

• Getting alongside small businesses to help them navigate Fair Work awards without getting overwhelmed
• Making sure vulnerable workers don't fall through the cracks when it comes to FWO awards
• Teaching everyone about their rights and responsibilities under Fair Work Australia award rules

The FWO is paying special attention to:

• Aged care services 
• Farms and agricultural businesses
• Building sites and construction companies
• Disability support providers
• Restaurants, cafes and fast food outlets
• Big corporate organisations
• Universities and higher education

To find out more about the Fair Work priorities, you can visit the priorities page on the FWO site.

Fair Work Awards 

What Are the Fair Work Awards? 

Fair Work awards are set by Fair Work Australia, to ensure that employees in Australia receive fair treatment and protection in the workplace. Let’s break down the key elements that Fair Work awards cover:

• Minimum Rates of Pay: Specifies the least amount an employee can be paid for their work.
• Hours of Work: Details the standard working hours for employees.
• Breaks: Outlines how many breaks employees are entitled to during the work day.
• Annual Leave: Defines the minimum amount of paid leave employees must receive each year.
• Superannuation: Sets the minimum contribution employers must make to an employee's super fund.
• Overtime: Addresses pay rates for work done beyond regular hours.
• Allowances: Details any additional payments for work-related expenses.
• Public Holiday Entitlement: Specifies how much more an employee should be paid for working on a public holiday.
• Sick Pay: Covers the provision of paid sick leave for employees.
• Employment Conditions: General working conditions that apply to employees within the award framework.

Hospitality Awards

Hospitality award pay rates vary depending on the level and job title. As of 1 July 2024, the minimum hourly rate of pay for entry-level or Level 1 hospitality workers is $24.10. This increases to $30.63 for Level 6 (cook grade 5).

On average, entry-level positions in the hospitality industry start at around $62,000 per year, while experienced professionals earn up to $120,000 annually.

Retail Awards

The General Retail Industry Award specifies the minimum retail employees should be paid. Effective as of 1 July 2024, the rates are $24.10 per hour for a Level 1 retail employee, going up to $29.48 per hour for a Level 8.

In the retail sector, the average annual salary for a store manager is about $59,991.

Construction Awards

The Building and Construction General On-Site Award defines the pay structure for construction workers. From 1 July 2024, the minimum hourly rates are between $24.10 for a Level 1 Construction Worker to $31.15 per hour for someone working at Level 9.

According to the Australian Bureau of Statistics, construction workers took home an average of $1,500 per week in 2024.

Modern Awards 

There are over 100 Modern Awards covering a variety of industries and occupations. The Fair Work Commission regularly reviews and updates these awards and, as of November 2024, the average weekly earnings for full-time adults was $1975.80 – an increase of 4.6% from the year before.

Looking for a Fair Work award that applies to your job? The first step is to check if your industry is covered by a Modern Awards.

Other Awards 

• Animal Care & Veterinary Services
• Australian Government Industry
• Banking, Finance and Insurance
• Children's Services
• Cleaning Services
• Dry Cleaning and Laundry Industry
• Fast Food Industry
• Gardening & Landscape Services
• Health Professional Services
• Mining Industry
• Real Estate Industry
• Waste Management Industry

Awards Interpretation

For businesses, award interpretation is the process of determining your employees' minimum pay rates and working conditions as laid out by the FW Act. The system came into effect in 2010 and is reviewed regularly. 

You can use the award-finder tool if you aren't sure which awards apply to your business. An award may not cover an employee if their employer operates with a registered agreement – a kind of private contract that must be signed by the employer and employee, and registered and approved by Fair Work Australia. You may want to reach out for external advice if you are unsure about which award is applicable.

Award interpretation across every industry includes:

• Base wages
• Allowances
• Penalties
• Overtime
• Other specific entitlements, such as public holiday pay

Common Mistakes For Employers When Interpreting Awards

As a business owner, you want to make sure you’re paying your staff correctly. Happy employees make for positive business morale and a greater chance of success. However, there’s no doubt the awards can sometimes be confusing.

With over 120 awards currently being used, and different requirements for full-time, part-time and casual employees, it’s understandable how easily things can get missed. Employers have commonly made a mistake when calculating the following from awards:

• Base pay rates
• Penalties
• Tax
• Leave entitlements
• Super contribution
• Employee remuneration
• Overtime or night rates

Mistakes are common and fines for non-compliance are up to $51,000 – so be sure to contact Fair Work if you need help. 

Automating Your Award Interpretation with QuickBooks

Keep it simple with accounting software. QuickBooks Payroll makes it easier to pay your employees correctly by automatically calculating the appropriate Fair Work award.

QuickBooks Payroll is powered by Employment Hero and features inbuilt, automated modern award interpretation. Our extensive list of modern awards is ready to go so you can be compliant in payroll each and every pay run.

There is no need for you to calculate the rates yourself or manually input them in the system – QuickBooks Payroll takes care of everything. You don't need to worry about overpaying or underpaying your employees, if they’ll be paid the correct award rate, or if you’ve captured all their entitlements. When you use QuickBooks Payroll, you can rest assured that your business will be compliant with the FWO.

Please note the automated award interpretation feature is only available with QuickBooks Advanced Payroll. You can find payment plans at the bottom of this page.

While every care has been taken to ensure the accuracy of the information presented as at 24 February 2025, Intuit is not providing you with professional advice and we recommend you obtain your own professional advice. Intuit is not liable for your use of the information presented.

Fair Work FAQs

Need more help understanding awards? The Fair Work Ombudsman website has lots of helpful resources, or you can contact them directly for personalised guidance.