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6305.0.55.001 - Employee Earnings and Hours, Australia, Preliminary, August 2008 Quality Declaration 
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 07/04/2009   
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GLOSSARY

Adult employees

Employees who are 21 years of age or over, and employees under 21 who are paid at the full adult rate for their occupation.

Average (mean) earnings

The amount obtained by dividing the total earnings of a group (e.g. full-time employees) by the number of employees in that group.

Award or pay scale only

Awards are legally enforceable determinations made by federal or state industrial tribunals that set the terms of employment (pay and/or conditions) usually in a particular industry or occupation. From March 2006, pay rates for employees in the federal jurisdiction who were previously paid by an award are now contained within the Australian Pay and Classification Scales (Pay Scales). Pay rates for employees in one of the state jurisdictions who are paid by an award continue to be contained within the award.

An award or pay scale may be the sole mechanism used to set the pay and/or conditions for an employee or group of employees, or alternatively may be used in conjunction with an individual or collective agreement. Employees are classified to the Award or pay scale only category if they are paid at the rate of pay specified in the award or the pay scale, and are not paid more than that rate of pay.

Cash earnings

Remuneration paid to employees on a regular and frequent basis (quarterly or more frequently) for time worked or work done and for time not worked, such as recreation and other types of paid leave. Cash earnings (inclusive of amounts salary sacrificed) are gross amounts, that is, before tax and other items (e.g. superannuation) are deducted.

Casual employees

Casual employees usually receive a higher rate of pay, to compensate for lack of permanency and leave entitlements.

Collective agreement

An agreement between an employer (or group of employers) and a group of employees (or one or more unions or employee associations representing the employees). A collective agreement sets the terms of employment (pay and/or conditions) for a group of employees, and is usually registered with a Federal or State industrial tribunal or authority.

Employees are classified to the Collective agreement category if they had the main part of their pay set by a registered or unregistered collective agreement or enterprise award.

Employees

Persons who work for a private or public employer, and received pay for the reference period in the form of wages or salaries, a commission while also receiving a retainer, tips, piece rates or payment in kind. Persons who operate their own incorporated business with or without hiring employees are also included as employees.

Full-time employees

Employees who normally work the agreed or award hours for a full-time employee in their occupation. If agreed or award hours do not apply, employees are regarded as full-time if they usually work 35 hours or more per week.

Individual arrangement

An arrangement between an employer and an individual employee on the terms of employment (pay and/or conditions) for the employee. Common types of individual arrangements are individual contracts, letters of offer and common law contracts. An individual contract (or letter of offer) may specify all terms of employment, or alternatively may reference an award for some conditions and/or in the setting of pay (e.g. overaward payments). Individual contracts may also be registered with a Federal or State industrial tribunal or authority (e.g. as an Australian Workplace Agreement). Working proprietors of incorporated businesses are regarded as having their pay set by individual arrangements, and are identified separately within the individual arrangement category.

Employees are classified to the Individual arrangement category if they have the main part of their pay set by an individual contract, registered individual agreement (e.g. Australian Workplace Agreement), common law contract, or if they receive overaward payments by individual agreement.

Industry

Classified according to the Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006 (cat. no. 1292.0).

Jurisdiction

The workplace relations jurisdiction (i.e. Federal or State) that the employee is deemed to be under for pay-setting purposes. Employees in the federal jurisdiction comprise:

  • employees of constitutional corporations
  • employees in Victoria, Australian Capital Territory, Northern Territory and Christmas and Cocos Islands
  • employees of the Commonwealth, including its authorities
  • waterside, maritime and flight crew employees.

The state jurisdictions comprise all other employees.

Median earnings

The amount of earnings which divides employees into two groups containing equal numbers of employees, one half with earnings below the median and the other half with earnings above the median.

Method of setting pay

How the main part of an employee's pay is set. Employees are classified to one of the following categories: Award or pay scale only; Collective agreement; or Individual arrangement. Working proprietors of incorporated businesses are separately identified within the individual arrangement category.

Ordinary time cash earnings

Payment for award, standard or agreed hours of work, including allowances, penalty payments, payments by measured result and regular bonuses and commissions. Ordinary time cash earnings are inclusive of amounts salary sacrificed. Excluded are non-cash components of salary packages, overtime payments, retrospective pay, pay in advance, leave loadings, severance pay, and termination and redundancy payments.

Overtime earnings

Payment for hours worked in excess of award, standard or agreed hours of work.

Part-time employees

Employees who normally work less than the agreed or award hours for a full-time employee in their occupation. If agreed or award hours do not apply, employees are regarded as part-time if they usually work less than 35 hours per week.

Percentile

Any of a hundred divisions of an earnings or hours distribution. For example:
  • 25% of employees earn less than or equal to the 25th percentile
  • 75% of employees earn less than or equal to the 75th percentile.

Permanent or fixed term employees

Permanent employees are usually employed on an ongoing basis and are entitled to paid annual and sick leave. Fixed term employees are employed for a specific period of employment, and may be entitled to paid leave.

Reference period

The survey refers to the last pay period ending on or before 15 August 2008. All estimates of earnings in this publication are weekly, therefore, for employees paid other than weekly, estimates of earnings have been converted to a weekly basis.

Salary sacrifice

An arrangement under which an employee agrees contractually to forgo part of the remuneration, which the employee would otherwise receive as wages and salaries, in return for the employer or someone associated with the employer providing benefits of a similar value (Australian Tax Office).

Sector

Public sector comprises local government authorities and all government departments and agencies created by, or reporting to, the Commonwealth, or state/territory Parliaments. The private sector comprises all organisations not classified as public sector.

Weekly total cash earnings

Weekly total cash earnings of employees is equal to weekly ordinary time cash earnings plus weekly overtime earnings.

Working proprietor of an incorporated business

A working proprietor of an incorporated business is considered to be an employee of their own business. As working proprietors of incorporated businesses differ from other employees in having the power to determine their own pay and working hours (subject to the earnings of the business and other factors), they are separately identified within the individual arrangement category.


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