The Professional Employees Award is a bit of an outlier of the modern awards.

Firstly, it largely covers highly paid professional salaried employees whose peers in other industries are generally not covered by the modern award system. Secondly, the current award does not prescribe any payments for overtime or penalty rates. This award covers engineers, scientists, medical researchers, and employees in information technology, quality auditing and telecommunications services. 

Employees covered by this award are usually paid an annual salary that is intended to cover all hours worked, and often do not have any fixed hours of work. They are usually not paid any overtime payments for hours worked in excess of 38 hours per week, and are rarely granted time off in lieu for additional or excessive hours. 

The Fair Work Commission (FWC) has determined to vary the award on two important issues: 

• hours of work and overtime; and 
• the coverage of the award. 

Changes to hours of work and overtime 

The FWC considered it necessary to prescribe special rates of compensation for additional and unsociable hours for full-time employees for the award to meet the modern awards objective of establishing a fair and relevant safety net. The following changes apply to all employees: 

• Ordinary hours of work will be 38 hours per week. This amends the current ability to average hours over a period. 
• An employer may require that an employee works more than 38 hours per week provided that the additional hours are reasonable. 

More importantly, the FWC determined the following changes for employees who do not have a contractual entitlement to an annual salary that is at least 25 per cent above the minimum award rate: 

• Overtime: Employees will be paid their hourly rate for all hours worked in excess of 38 in a week. This will include work on or in connection with call-backs and work performed on electronic devices or otherwise remotely. 
• Time off in lieu: Employees can agree to take TOIL instead of receiving payment for overtime. 
• Penalty rates: A penalty rate of 25 per cent will be payable for all hours worked between 10pm and 6am on any day Monday to Saturday. A penalty rate of 50 per cent will be applicable for all hours worked on a Sunday or a public holiday. For casual employees, these penalty rates are in addition to their 25 per cent casual loading.   

Record keeping obligations 

For employees who do not receive at least 25 per cent more than the minimum annual wage of the award, records must be kept of all hours: 

• worked in excess of 38 hours per week 
• worked between 10pm and 6am Monday to Saturday, and   
• worked on a Sunday or a public holiday. 

The records should include work performed remotely, on electronic devices or in connection with call-backs. 

Change to coverage of the award 

Regarding the award coverage, the FWC clarifies that the classifications will apply to all employees who are covered by the award and its classifications unless the person holds a position that is wholly or principally managerial in nature.   

Key take aways 

These changes are expected to be announced by the FWC soon and most likely will commence in March/April 2023. We recommend taking the following steps: 



• conduct an audit on current employee contracts and salary levels as well as overtime practices of your employees that are covered by this award, and 
• develop and implement appropriate plans ahead of these changes taking effect. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. If you require advice or assistance, please contact our Workplace Relations consultants.