Current at: 10 May 2010
Guide to ACT employers – are you putting on a new employee in the Building and Construction Industry?
This guide provides a simple checklist summary of the legal requirements you need to consider when taking on new on-site employees (including apprentices). We have also included some sample template documents to assist in the process.
Determine the employee’s entitlements
An employee is an Award employee or a non-award employee.
Award Employee: If there is an Industrial Award which covers the employee’s industry or occupation and contains a classification for the role (or type of role) they undertake then you will need to comply with all the conditions of the relevant award. The award will stipulate the minimum wage rate of pay and other entitlements. Awards conditions must comply with the National Employment Standards. Even if you pay above award wages or under annualised salary arrangements, they still will be considered award employees.
Non-Award Employee: If there is no award covering the type of work they carry out then they will be a “non-award” employee. Traditionally managerial level employees do not fall within an award classification. The conditions of employment for non-award employees are set out under the National Employment Standards and their contract of employment.
If you have an enterprise agreement in place that covers the employee’s work classification, an employee’s entitlements will come from that agreement.
Call your HIA Workplace Advisor on 1300 650 620 for information on rates of pay and award coverage.
Make the offer of employment
Even if they are an award employee, it is a good idea to get all new employees to sign and accept a written offer of employment that sets out the conditions of employment that have been agreed to. You can also provide other information relevant to the business, such as workplace policies or rules. Please see Attachment A - letter of offer/contract of employment template. HIA has also developed a range of information sheets which provide example workplace policies - call your HIA Workplace Adviser on 1300 650 620 for more information on workplace policies.
Provide the new employee with the Fair Work Information Statement
The Fair Work Information Statement must be provided to the new employee as soon as possible before or after they commence. This statement is an overview of rights and entitlements under the Fair Work Act 2009. It is available on the Fair Work website (http://www.fairwork.gov.au).
Obtain your employee’s details
Ensure that you have all relevant contact details such as home address, phone number, email address and emergency contact. Where relevant, you may also need the employee’s bank account details (for payment of wages) and information relating to medical conditions or allergies that have the potential to affect the employee’s capacity to carry out their role.
Obtain the employee’s Tax File Number Declaration form
All new employees are required to fill our and complete a Tax File Number Declaration form. The form enables you to work out how much tax to withhold from payments made to your employee. You can get the form from some newsagents or by contacting the ATO. The employee needs to complete the form and return it to you. There is a ‘Payer’ section of the form (section B) that you must then complete and forward to the ATO within 14 days of the date the employee started with you.
Get a copy of the employee’s OHS Construction Induction Card
An OHS Construction Induction Card (White Card) is required by all employees carrying out construction work, including site managers, supervisors, surveyors, labourers and tradespersons. HIA runs training courses for those who would need to obtain this induction card – for more information call HIA on 1300 650 620.
Register for PAYG withholding
To register contact the ATO (13 28 66); or complete a “Add a new business account” form available on the ATO website (http://www.ato.gov.au); or speak to your tax advisor. You must keep records that explain your PAYG withholding transactions. Please see HIA’s info sheet on employment records.
Your employee is entitled to super from the first day you employ them (provided they are eligible for super) so you will need to determine which fund contributions will be made to. Most employees are entitled to select their superannuation fund. If your new employee is eligible to choose a super fund, you should provide them with a Standard choice form within 28 days from the day they started working for you.
Your employee does not have to complete the form if they do not want to nominate a fund but you still need to give them the choice. If your employee does not select a fund you must pay contributions into a fund you nominate. You should make sure that the fund you nominate complies with the Award (where applicable) and that the fund is a ‘complying fund’.
For more information on super choice, call the Australian Tax Office on 13 10 20 or go to www.ato.gov.au. HIA also has more specific information on choice of super fund.
Super guarantee contributions have to be paid for each eligible employee to the correct super fund at least four times a year (see quarterly cut off dates at http://www.ato.gov.au). Some funds require that contributions be made on a more frequent basis.
It is compulsory for all employers in the ACT to have a current ACT workers compensation policy in place with an Approved Insurer. Under the ACT Workers Compensation Act 1951 (the Act) an employer is liable for any compensation payable to a worker suffering work-related injury or disease. Where an employer has a current workers compensation policy, the insurer indemnifies the employer for costs of the claim. If you already have a workers compensation insurance policy and want to add an employee you should contact your insurer.
For more information go to the Department of Justice & Community Safety Office of Regulatory Services web site (http://www.ors.act.gov.au/workcover/WebPages/WorkComp/faqwc.htm)
Long service leave
There is a special scheme in place for long service payments for workers in the ACT building and construction industry. The ACT Long Service Leave Authority is responsible for administering the scheme. Payments are for service to the industry instead of to an individual employer.
Individual workers have their periods of employment in the building and construction industry recorded by the Authority. As an employer you are required to provide this information to the Corporation, by registering then advising the Corporation any time a worker’s employment starts and ends. This scheme is funded by employers who contribute to the Authority every quarter, currently equal to 1% of employees’ wages.
For more information go to the ACT Long Service Leave Authority web site (http://www.actlslb.act.gov.au/)
If your wages (which may include some contractors who are "deemed" employees) exceed the payroll tax threshold, you will incur a payroll tax liability.
From 1 July 2009 to 30 June 2010 the threshold is $638,000 and the tax rate is 5.65% from 1 January.
The monthly thresholds are:
28 days = $48,942
30 days = $52,438
31 days = $54,186
If you think you might exceed this threshold let us know and we will get you some information in relation to the payroll tax deeming provisions.
For information on what types of employment records an employer needs to keep please refer to HIA Information Sheet NAT- Employment Records and Pay Slips.
For more information call the HIA member Hotline on 1300 650 620