Award coverage refers to whether a Modern Award applies to an employer and/or employee based on industry or occupation in Australia.
Legislation: Fair Work Act 2009 Part 2-3 | Category: Industrial Instruments
What is Award Coverage?
Award coverage refers to whether a Modern Award applies to an employer and/or employee based on the industry in which the employer operates and/or the occupation of the employee. Modern Awards are legally binding instruments that set minimum terms and conditions of employment for specific industries or occupations.
There are over 120 Modern Awards in Australia, each covering different industries (such as the Clerks — Private Sector Award or Restaurant Industry Award) or occupations (such as the Manufacturing and Associated Industries and Occupations Award). Determining correct award coverage is fundamental to compliance.
Key Compliance Points for Employers
- Coverage is determined by the employer’s principal business activity or the employee’s occupation
- Some employees may be covered by an occupation-based award rather than their employer’s industry award
- Managers and professional employees earning above the high income threshold may be award-free
- Enterprise agreements can override awards but must leave employees better off overall
- Using the wrong award classification is a common cause of underpayment
Frequently Asked Questions
What is Award Coverage?
Award coverage refers to whether a Modern Award applies to an employer and/or employee based on industry or occupation in Australia.
Why is Award Coverage important for employers?
Understanding award coverage helps employers comply with Australian employment law, avoid penalties, and maintain fair workplace practices.
