Understanding Wage and Hour Laws in NSW
Getting pay right is one of the most important parts of any workplace. It is not just about numbers on a payslip. It is about people being treated fairly, trust between employers and staff, and the security that comes from knowing the rules are being followed.
In New South Wales, wage and hour laws are based on the Fair Work Act 2009 and overseen by the Fair Work Ombudsman. While the law sets the framework, it is how these rules play out in day-to-day business that often causes confusion.
Here are the essentials every employer and employee should know.
Minimum Wage and Awards
Everyone in NSW must receive at least the national minimum wage, unless their role is covered by an award or enterprise agreement.
Awards are legally binding documents that set out pay rates, penalty rates, overtime, allowances, and other entitlements for particular industries or job types. For example, a café worker is usually covered by the Hospitality Award, while an office administrator may fall under the Clerks Award.
Applying the wrong award, or ignoring it altogether, is one of the most common causes of disputes. The recent minimum wage increase shows how important it is to stay on top of changes that affect eligible employees' pay. Speaking with an employment lawyer can help make sure the right award is being applied.
Ordinary Hours of Work
The standard working week is 38 hours, plus what the law calls “reasonable additional hours.” What counts as reasonable depends on factors like:
the role and personal circumstances of the employee
the amount of notice given
any health and safety risks
Employers cannot expect unlimited overtime. Employees also have the right to say no if the request is unreasonable. Clear policies, set up with expert legal advice, can make this easier to manage.
Overtime and Penalty Rates
Many awards require higher rates of pay in certain situations, including:
working more than 38 hours a week
weekends
public holidays
very early or very late shifts
These higher rates, often called penalty rates, are designed to recognise the extra burden or disruption caused by those hours. Businesses should check with a workplace or employment law expert before setting rosters that may trigger these obligations.
Record-Keeping
Employers must keep clear and accurate records of:
hours worked
wages paid
leave entitlements
superannuation contributions
Without these records, it is extremely difficult to defend against an underpayment claim. Having the right employment law systems in place reduces the risk of mistakes and makes audits less stressful.
Why It Matters
For employers, mistakes can lead to fines, orders to repay wages, and reputational damage. For employees, it can mean missing out on income you are legally entitled to.
We often see small businesses caught out during audits and employees frustrated after months of incorrect pay. Both situations can usually be avoided with clear structures and early legal advice. For business owners, this is as important as understanding issues like restraint clauses in employment agreements or the whole of relationship test when classifying workers.
Wage and hour rules are not just about compliance. They are about fairness, security, and maintaining healthy working relationships.
If you are unsure whether your business is meeting its obligations, or if you think your pay may not be correct, it is best to get clarity early before issues escalate.
At Connected Legal + Commercial, we help employers set up the right frameworks to avoid disputes and support employees in understanding their entitlements. Speak with an employment lawyer today if you need guidance.
DISCLAIMER
The content given herein is provided for information purposes only. It is general in nature and does not constitute legal advice and should not be used as such. Formal legal advice should be sought in particular matters.
Connected Legal + Commercial does not accept any liability to any person for the information (or use of such information) which is provided herein or incorporated into it by reference.
The information is provided in good faith on the basis that all persons accessing the content undertake responsibility for assessing its relevance and accuracy and will seek appropriate formal legal advice accordingly.