Penalty Rates, Overtime and IFAs


With so much debate surrounding penalty rates right now, there can be some confusion as to how to wages are affected. This becomes especially confusing when overtime comes into play. Here are some things to keep in mind when working with penalty rates:

  • Understand which award applies to your staff members.
  • Understand the overtime and penalty rate clauses in these awards.
  • Keep an updated record of all hours worked by employees. Ensure all staff have accurate timesheets that consider any overtime hours worked.
  • Have a clear workplace policy surrounding overtime hours worked. This should include payment of overtime and penalty rates, and time off in lieu (TOIL).
  • If you operate in an industry that requires weekend work or night work, clearly state what the penalty rates will be for those hours.
  • Don’t assume that because you are paying above the award that penalty rates don’t apply.

Individual Flexibility Agreements (IFAs) can be a way of changing the effect of certain clauses in an employee’s award or agreement. An IFA can allow you to discuss items such as payment rates and options for overtime, and reach a conclusion that benefits both the individual and the organisation. While this can be a great way of ensuring mutual satisfaction with wages or salaries, it is important to remember that it requires clear communication between you as an employer and your employees.

For more information on penalty rates and overtime, and how to use IFAs, contact us on (08) 9316 9896 or


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Marisa Ross

HR Advisor

Marisa is an experienced and motivated HR professional with a strong HR generalist and business operations background with a focus on employee relations, performance management, leadership training & development, workers compensation & injury management, and employee retention. Marisa holds a Bachelor of Human Resource Management and a Bachelor of Behavioural Science with a minor in Counselling. Having worked in a variety of industries from SMEs to large blue-chip organisations, Marisa is passionate about enriching employee experience, employee retention, and building leadership capability in people management.

Aimee Grigson

Aimee Grigson

WHS Advisor

Aimee has a strong understanding of Workplace Health and Safety Legislation and standards and has extensive HSEQ experience in a number of industries. Aimee has a great ability to engage across all levels of organisation, including field teams, leadership and external stakeholders. Aimee ensures Health and Safety Management Systems are compliant to legislation, effectively implemented and understood by all. Aimee has a Certificate IV in Work Health and Safety and qualifications in auditing and incident investigations. Aimee is passionate about coaching and developing small businesses towards a positive safety culture.