Banking, Finance, and Insurance Award pay rates, allowances, and overtime
The Banking, Finance, and Insurance Award 2020 establishes the employment conditions for individuals working in these sectors. This award ensures that employees receive fair compensation and work under appropriate conditions, covering a broad spectrum of roles within these industries.
This overview provides a comprehensive look at the minimum base pay rates, payment procedures, various allowances, superannuation contributions, overtime and penalty rates, leave entitlements, and public holiday provisions under the award, ensuring that both employers and employees are well-informed. Understanding these components is vital for employers to maintain compliance and promote fairness in the workplace.
Note: The information provided in this article is accurate as of 18/07/2024. As award conditions and rates are subject to change, please refer to the latest version of the Banking, Finance, and Insurance Award 2020 for the most current information.
Banking, Finance, and Insurance Award minimum pay rates
Understanding the minimum pay rates is essential for ensuring fair compensation within the banking, finance, and insurance sectors. The award provides detailed guidelines on the minimum pay rates applicable to various categories of employees within these industries.
For full-time employees, the award specifies the minimum annual or weekly rate that must be paid. Part-time employees, on the other hand, are entitled to a minimum hourly rate. Additionally, casual employees receive a 25% loading on top of a minimum hourly rate for each hour worked. This structure ensures that all employees, regardless of their employment type, receive fair and equitable compensation for their work.
Category
Description
Rates/details
Example
Adult employees
Employees aged 21
and over
Level 1:
$49,145 per year
$945.10 per week
or $24.87 per hour
Level 2:
$53,680 per year
$1032.30 per week
or $27.17 per hour
Level 3:
$56,696 per year
$1090.30 per week
or $28.69 per hour
Level 4:
$59,540 per year
$1145.00 per week
or $30.13 per hour
Level 5:
$61,958 per year
$1191.50 per week
or $31.36 per hour
Level 6:
$69,394 per year
$1334.50 per week
or $35.12 per hour
A 25-year-old full-time customer service representative will be paid $49,145 per year or $945.10 per week.
Junior employees
Employees aged under 21
Under 17: 50% of adult employee rate
17 years: 60% of adult employee rate
18 years: 70% of adult employee rate
19 years: 80% of adult employee rate
20 years: 90% of adult employee rate
An 18-year-old part-time junior administrative assistant will earn $17.41 per hour (70% of the adult Level 1 rate).
Supported wage system
Employees with a disability eligible for a supported wage
Minimum amount payable is determined by assessed capacity and relevant award pay rates
An employee with a disability assessed at 60% capacity will be paid 60% of the relevant minimum rate for their classification.
National training wage
Employees undertaking a traineeship
Rates depend on training package, qualification level, and year of training
A first-year trainee in a Certificate III program will be paid according to the specified rates for that training package and year.
Banking, Finance, and Insurance Award payment of wages
The Banking, Finance, and Insurance Award provides clear guidelines on wage payment procedures, ensuring both employers and employees manage their financial expectations effectively.
- Pay period: Employers must pay employees weekly or fortnightly, or monthly if mutually agreed, with monthly payments structured as two weeks in advance and two weeks in arrears.
- Payment method: Payment of wages can be via cash, cheque, or electronic funds transfer, at the employer’s discretion.
- Termination payments: Employers must settle all outstanding wages and entitlements within seven days of an employee's termination. This includes all earnings up to the final day of employment, in accordance with the award and NES.
- Annualised wage agreements: Employers and full-time employees can agree on an annualised wage covering certain award provisions, provided it meets or exceeds what the employee would have earned otherwise. These agreements must be documented, detailing the wage, covered provisions, calculation method, and limits on hours. Annual reviews ensure the employee isn’t disadvantaged, with any shortfalls paid within 14 days.
Banking, Finance, and Insurance Award allowances
The award includes a variety of allowances designed to reimburse employees for additional expenses incurred during their work. These allowances ensure that employees are fairly compensated for any extra costs related to their job duties. Here are the key allowances provided under this award:
Allowance type
Description
Amount/details
Meal allowance
For employees required to work overtime extending beyond 6:00 PM
$20.73 for a meal; additional $17.04 if overtime exceeds five and a half hours
Stand-by and call-back allowance
For employees required to be available outside ordinary hours
$21.88 per day for Monday to Friday; $44.70 per day for Saturdays, Sundays, and public holidays
First aid allowance
For employees appointed as accredited first aid officers
$18.99 per week for full-time employees; pro rata for part-time employees
Travelling expenses allowance
For employees required to travel for work
Reimbursement of all reasonable travel expenses; half the ordinary rate for travel time exceeding normal commute
Motor vehicle allowance
For employees using their private vehicle for work-related travel
$128.95 per week for vehicles 1500cc and under; $159.07 per week for vehicles over 1500cc; $0.99 per kilometre for casual use
Banking, Finance, and Insurance Award superannuation
The Banking, Finance, and Insurance Award outlines essential superannuation guidelines to ensure employees receive appropriate retirement benefits:
- Employee eligibility: Under the NES, employees earning $450 or more (before tax) in a calendar month and aged over 18 are eligible for superannuation contributions. Those under 18 are eligible if they work over 30 hours a week.
- Employer contributions: Employers must contribute to a superannuation fund to avoid the superannuation guarantee charge, with the current rate at 11.5% of an employee's ordinary time earnings (OTE).
- Fund selection: Employees can choose their superannuation fund. If they don’t choose one, employers must check with the ATO for a stapled fund and contribute to it. If there’s no chosen or stapled fund, employers should make contributions to one of the following funds, provided it can accept contributions:
- CareSuper
- AustralianSuper
- Sunsuper
- HESTA
- Statewide Superannuation
- Tasplan
- NGS Super
- MTAA Superannuation Fund
- Any fund the employer was contributing to before 12 September 2008, provided it is an eligible choice fund and offers a MySuper product or is an exempt public sector superannuation scheme
- A fund or scheme in which the employee is a defined benefit member
- Voluntary contributions: Employees can make additional contributions to their superannuation fund from their post-tax income, separate from compulsory employer contributions. Employees should inform their employer if they wish to make voluntary contributions through salary sacrifice arrangements.
- Contribution during leave: Employers must also make superannuation contributions during periods of paid leave or for up to 52 weeks if an employee’s absent because of a work-related injury or illness and continues to receive compensation payments or regular payments from the employer.
For accurate information, always check the Award for updates along with the Fair Work Commission’s super guarantee guidelines.
Banking, Finance, and Insurance Award overtime and penalty rates
Overtime and penalty rates ensure fair compensation for employees working beyond their regular hours. The Banking, Finance, and Insurance Award outlines specific conditions and rates for overtime.
Overtime rates
All time worked at the direction of the employer outside ordinary hours of work prescribed by this award is subject to overtime rates. Note that overtime worked on a given day is calculated separately from overtime worked on other days.
Additionally, employees who finish overtime and are scheduled to start their next shift in less than 10 hours can delay their start time until they’ve had a 10-hour break without losing pay for missed ordinary hours. If a 10-hour break isn’t provided, the employer must continue to pay the overtime rate until the employee gets a break of at least 10 hours.
Hours of overtime worked per day
Overtime rate
Monday to Saturday—first three hours
150% of minimum hourly rate
Monday to Saturday—after 3 hours
200% of minimum hourly rate
Sunday—all time worked
200% of minimum hourly rate
Rostered day off—all time worked
200% of minimum hourly rate
Example
Jane’s a full-time banking analyst classified as Level 3 with a regular hourly rate of $30.00 who works a standard 38-hour week. One week, she works an additional eight hours beyond her regular hours, with three hours of overtime on Wednesday, two hours on Saturday, and three hours on Sunday.
- First three hours of overtime on Wednesday: 3 hours x $30.00 x 1.5 = $135.00
- First two hours of overtime on Saturday: 2 hours x $30.00 x 1.5 = $90.00
- Three hours of overtime on Sunday: 3 hours x $30.00 x 2 = $180.00
Total overtime pay: $135.00 + $90.00 + $180.00 = $405.00
Time off instead of payment for overtime
Under the award, employees can take time off instead of receiving overtime pay if both parties agree in writing. Key points include:
- Agreement: Employee and employer must agree in writing.
- Equivalent time: Time off matches the overtime pay.
- Timing: Time off must be taken within six months.
- Request for pay: Employee can request pay for overtime anytime, which must be paid in the next pay period.
- Unused time: If not taken within six months, overtime pay must be provided.
- No pressure: Employer cannot pressure the employee to choose time off.
- Termination: Unused time off must be paid out if employment ends.
Penalty rates
The Banking, Finance, and Insurance Award outlines specific penalty rates for employees working shifts outside of the standard daytime hours. For casual employees, these penalty rates are calculated in addition to the casual loading, both applied to the casual's minimum hourly rate. Specific details of these rates include:
- Early morning shift (starting before 6 AM): Additional 15%
- Afternoon shift (starting after 12 PM and finishing at or before 8 PM): Additional 15%
- Night shift (finishing after 8 PM and at or before 6 AM): Additional 30%
- Permanent night Shift (working night shifts continuously): Additional 30%
Banking, Finance, and Insurance Award leave and public holidays
The Banking, Finance, and Insurance Award provides a range of essential leave entitlements, ensuring employees receive the necessary time off for various circumstances. This section details the different types of leave employees can access, including annual leave, personal/carer's leave, compassionate leave, parental leave, community service leave, and leave for family and domestic violence. These entitlements are designed to promote a balanced and supportive work environment.
Annual leave
Clause
Details
Example
Annual leave entitlement
Full-time employees earn four weeks of annual leave per year. Part-time employees accrue leave proportionally.
A full-time employee working 38 hours weekly receives four weeks of annual leave yearly.
A part-time worker putting in 19 hours weekly accumulates four weeks of leave, paid at 19 hours per week.
Payment for period of annual leave
Employees are compensated at their usual wage rate during leave, plus a 17.5% loading.
Alex, earning $1,500 weekly, takes two weeks of annual leave and receives $1,500 per week plus an additional 17.5% loading. Thus, for two weeks: $1,500 x 2 weeks x 17.5% = $525.
Shutdown period
Employers can temporarily close operations, requiring employees to use their paid annual leave, with 28 days' notice.
A business plans a shutdown in the first week of March, notifying employees on 1st February. Employees must take paid leave or, if insufficient leave is available, can agree to unpaid leave.
Leave in advance
Employees can take annual leave before it’s accrued if agreed in writing, specifying the amount and start date.
Moni and her employer agree she’ll take one week of leave in advance, beginning 1st August, documented in a signed agreement.
Cashing out annual leave
Employees can cash out annual leave if a written agreement with the employer is in place, keeping at least four weeks.
James, with six weeks of accrued leave, agrees to cash out two weeks, signing an agreement that details the payment and leaves a balance of four weeks.
Excessive leave accruals
More than eight weeks of leave is considered excessive. Employers and employees should discuss and agree on reducing it.
Does not bear an economic risk
Shiftworker additional leave
A shiftworker regularly rostered on Sundays and public holidays in a business operating 24/7 is entitled to an extra week.
Generally works for their employer exclusively
Other types of leave
The NES offer essential leave benefits to employees, ensuring they receive necessary time off for various personal and family-related reasons. Here is a summary of these entitlements:
- Personal/carer’s leave: Employees working full-time accumulate 10 days of paid leave each year, which they can use for their own illness or to care for an immediate family member. Part-time employees earn this leave proportionally based on their working hours.
- Compassionate leave: For each occasion of a severe illness or death in the immediate family or household, employees can take two days of compassionate leave.
- Parental leave: Eligible employees can avail themselves of up to 12 months of unpaid leave for the birth or adoption of a child. They also have the right to request an additional 12 months of leave, which employers can deny only for valid business reasons.
- Community service leave: This provision allows employees to take time off for community service activities, including volunteer emergency work and jury duty. While the leave is generally unpaid, employees may receive make-up pay for jury duty.
- Family and domestic violence leave: Employees are entitled to 10 days of paid leave each year to address family and domestic violence issues, such as seeking medical help, accessing support services, or attending court hearings.
Public holidays
Public holidays provide employees with essential time off from work and form a crucial part of their benefits. Below is an overview of how public holidays are managed according to the Banking, Finance, and Insurance Award and the NES:
Clause
Details
General entitlement
Under the NES, employees (excluding casuals) are entitled to a paid day off on a public holiday.
Reasonable refusal
Employers can request an employee to work on a public holiday if the request is reasonable. Employees have the right to refuse if the request is unreasonable or if their refusal is reasonable.
Substituting a public holiday
Employers and employees can agree to swap a public holiday for another day. Similarly, they can agree to substitute another part-day for a part-day public holiday.
Public holiday rates and minimum engagement
Employees who work on a public holiday, or a substituted day or part-day, must be paid 250% of the minimum hourly rate. If both the original public holiday and the substitute day are worked, the employee can choose on which day the penalty rates apply.
Employees required to work on a public holiday must be paid for at least four hours at the specified penalty rate, provided they are available to work for those hours.
Hours surrounding public holidays
Work hours immediately before or after a part-day public holiday, if they form part of one continuous shift, count towards the minimum payment period specified.
Recognised public holidays
Recognised public holidays include New Year’s Day, Australia Day, Good Friday, Easter Monday, Anzac Day, Queen’s Birthday, Christmas Day, Boxing Day, and other nationally observed days.
Note, states and territories may declare extra public holidays, which employers must observe.
Substitute holidays
If a public holiday falls on a weekend, a substitute public holiday is typically declared, usually the following Monday.
Banking, Finance, and Insurance Award payment management tips
Ensuring compliance with the Banking, Finance, and Insurance Award requires a thorough understanding and meticulous management of various payment and entitlement provisions. Here are key strategies to effectively navigate these requirements:
- Stay informed on award updates: Regularly check for updates on minimum wages, overtime, and penalty rates specified in the award, as they may be revised annually.
- Leverage payroll software: Implement advanced payroll software to automate calculations for wages, overtime, penalty rates, and superannuation. This minimises errors and ensures timely payments.
- Maintain detailed records: Keep comprehensive records of all employee payments, including wages, overtime, penalty rates, and leave entitlements. Detailed documentation helps ensure compliance and resolve any disputes.
- Conduct regular audits: Periodically audit your payroll system to ensure it aligns with the latest award requirements. This helps in identifying and correcting any discrepancies.
- Document agreements thoroughly: Ensure all employee agreements related to annual leave (such as leave in advance or cashing out leave) and overtime (including time off in lieu) are well-documented and signed by both parties.
- Train HR and payroll staff: Provide extensive training for HR and payroll teams on the specifics of the banking, finance, and insurance award to ensure accurate management of payments and entitlements.
- Consult with experts: Seek regular advice from industrial relations specialists or legal advisors to stay updated on changes in the award or employment laws.
- Efficient leave management: Track employee leave balances accurately, including annual leave, personal/carer's leave, compassionate leave, and other entitlements. Keep employees informed about their leave balances and rights.
- Ensure superannuation compliance: Calculate superannuation contributions correctly based on ordinary time earnings (OTE) and make timely payments. Using payroll software can help automate these calculations and payments.
- Communicate transparently: Maintain open communication with employees regarding their pay, entitlements, and any changes to award conditions. This fosters trust and prevents misunderstandings.
- Adhere to NES guidelines: Stay updated with the National Employment Standards (NES), which provide the basic guidelines that interact with the banking, finance, and insurance award.
Banking, Finance, and Insurance Award nuances
Understanding the specifics of the Banking, Finance, and Insurance Award is crucial for employers to ensure compliance and avoid potential issues. Here are some key nuances that might catch employers off guard:
- Additional week of annual leave for shiftworkers: Shiftworkers who regularly work on Sundays and public holidays have a right to an extra week of annual leave.
Impact: Employers must accurately identify eligible shiftworkers and ensure they receive the additional leave. Mismanagement can lead to non-compliance and employee dissatisfaction.
- Overtime rest breaks: Employees who finish overtime and are scheduled to start their next shift in less than 10 hours can delay their start time until they’ve had a 10-hour break without losing pay for missed ordinary hours. If a 10-hour break isn’t provided, the employer must continue to pay the overtime rate until the employee gets a break of at least 10 hour.
Impact: It’s essential to manage overtime schedules effectively to provide the necessary rest breaks. Failure to do so can result in continuous overtime payments, leading to increased labour costs and potential legal issues.
- Meal allowance for overtime after 6:00 PM: Employees working between 10 PM and 6 AM receive a penalty rate in addition to their base pay. This applies to both full-time and casual employees but varies slightly depending on their classification
Impact: Employers need to meticulously track when overtime extends past 6:00 PM to ensure meal allowances are provided accordingly. Failure to do so can result in employee grievances and claims for unpaid allowances.
Simplifying Banking, Finance, and Insurance Award pay, overtime and superannuation compliance with Rippling
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- Accurate payroll calculations: Automatically calculate award pay rates, including penalty rates, allowances, and overtime.
- Overtime management: Track and manage overtime hours according to award requirements.
- Superannuation compliance: Ensure correct calculation, reporting and payment of superannuation contributions.
- Integrated payroll systems: Seamlessly integrate with existing payroll systems.
- Real-time updates: Receive updates on changes to pay rates and superannuation rules for various awards.
With Rippling, you can do more than just meet award compliance requirements; you can exceed them. Take the tour or contact us today!
Disclaimer: Rippling and its affiliates do not provide tax, accounting, or legal advice. This material has been prepared for informational purposes only, and is not intended to provide or be relied on for tax, accounting, or legal advice. You should consult your own tax, accounting, and legal advisors before engaging in any related activities or transactions.
