Author: Lehanne Bleumink, Gold Seal HR Services Manager

With the conclusion of the Fair Work Commission (FWC) four-yearly review of modern awards late 2019, 2020 is already shaping up to be a year of legislative change within the HR/IR space. With these changes comes very important record keeping requirements and the need to review current employee arrangements and records.

Modern award changes
As detailed in the Newsflash available on the Gold Seal website, the Banking Finance & Insurance Award (BFI Award) 2020 came into effect on 4 February 2020, replacing the BFI Award 2010. Read the Newsflash here if you missed it.

The biggest change for most awards is the layout and language, which should make the awards easier to understand. This is the case with the BFI Award 2020 where the rules and entitlements have not changed significantly. It is important to note however, that on February 12 the FWC determined clause 17 Annualised Salaries will be varied significantly effective 1 March 2020. This means the BFI Award 2020 which came into effect on 4 February will change again effective 1 March 2020, to include the varied annualised salary clause 17, which will change to Clause 17 Annualised Wage Arrangements.

You can view the current BFI Award 2020 here – (note: clause 17 will change from 1 March)

Annualised salaries
Just to explain, annualised salary arrangements have been considered by the Fair Work Commission, this has resulted in a new clause to be inserted into 19 modern awards already containing an annualised salary clause and 3 modern awards which have not previously had an annualised salary clause. With this comes new record keeping requirements which come into effect on 1 March 2020.

While the current BFI Award 2020 does not include the varied annualised wage arrangements clause, it will be updated to reflect the change from 1 March 2020.

The varied clause 17 Annualised Wage Arrangements comes into effect on 1 March.

What is an annualised wage?
An annualised wage is the payment of an “all-inclusive” annualised rate of pay. The intention is to compensate an employee for all, or some, award monetary entitlements; such as minimum rates, allowances, overtime, penalty rates and annual leave loading. Under an annualised wage arrangement, employees are paid the same amount each pay period.

Annualised wage arrangements are used significantly in the financial services industry, with many employees paid above award or considered a high-income earner. A high-income earner (if their earnings are above the current rate of $148,700) is usually award free, therefore those who fall into this category will not be affected by the annualised wage changes.

What do you need to do?
As the annualised wage arrangement and record keeping changes that come into effect on 1 March 2020 are extremely complex, Gold Seal is in the process of drafting tools for employers to use to ensure, if used, they will meet the BFI Award 2020 and record keeping requirements. There will be updated offset remuneration clauses inserted into the current employment agreement template together with new and updated templates. They will be added to the suite of HR resources as soon as they are available.

The intention is to make the process as ‘easy’ as possible for employers, to ensure they remain compliant. It has always been a requirement that if the intention is to ‘build in’ everything and pay above award, that it must be in writing. In the past an employer may have considered they are meeting BFI Award requirements simply by paying above award and didn’t realise it must be in writing.

In moving forward, there will be extremely important record keeping requirements. Firstly, to be able to consider that everything is ‘built in’ to the salary, it MUST be in writing. The tools being drafted will ensure an employer meets these requirements if used correctly. The current HR resources will also be updated where required, to include the award changes as part of the upcoming updates.

Whilst there will be some work to do initially, this is a good opportunity for employers to update employee records, including employment agreements, to ensure they meet the BFI Award and record keeping requirements for those paid an annualised wage.


For assistance on any of your HR/IR requirements – call Gold Seal on 03 9510 5100 or email