Fair Work basics for building businesses

Does the Fair Work system cover your business?

Most private sector employers in Australia are in the national workplace relations system under the Fair Work Act 2009, administered by the Fair Work Ombudsman (FWO) and the Fair Work Commission.

Western Australia is the main exception. The WA Government says sole traders, unincorporated partnerships and some unincorporated trusts are covered by the WA state system, while Pty Ltd companies and partnerships or trusts involving a Pty Ltd entity are in the national system. If you are a WA builder trading as a sole trader or partnership, your employees’ minimum conditions come from WA law, not the federal awards described here.

This guide covers the national system. If you are not sure which applies, check before you set pay rates. Our guide to starting a building business covers business structures.

Which modern award covers your workers?

A modern award sets minimum pay rates, allowances, penalty rates, overtime and conditions for an industry or occupation. For building businesses, the main awards are:

• Building and Construction General On-site Award 2020 [MA000020]. Covers on-site general building and construction, civil construction, and metal and engineering construction.
• Plumbing and Fire Sprinklers Award 2020 [MA000036]. Covers plumbing and fire sprinkler fitting, including gasfitting and roof plumbing.
• Electrical, Electronic and Communications Contracting Award 2020 [MA000025]. Covers electrical, electronic and communications contracting.
• Joinery and Building Trades Award 2020 [MA000029]. Covers joinery, shopfitting, prefabricated building, stonemasonry, and glass and glazing, along with certain trades occupations.

The coverage clauses of these awards interact. For example, the on-site award excludes employers covered by the plumbing and electrical contracting awards. Which award applies depends on your industry and the employee’s classification, so read clause 4 of each candidate award. An office employee in a building business may be covered by a different award again.

If you have a registered enterprise agreement, it applies instead of the award, but it cannot undercut the National Employment Standards.

What are the National Employment Standards?

The National Employment Standards (NES) are the minimum entitlements every national system employee gets, whatever their award or agreement. According to the FWO, they cover:

• maximum weekly hours (38 for a full-time employee, plus reasonable additional hours);
• requests for flexible working arrangements;
• casual employment, including pathways to permanent employment;
• parental leave and related entitlements;
• annual leave;
• personal/carer’s leave, compassionate leave and family and domestic violence leave;
• community service leave;
• long service leave;
• public holidays;
• superannuation contributions;
• notice of termination and redundancy pay; and
• the Fair Work Information Statement and Casual Employment Information Statement.

You must give every new employee the Fair Work Information Statement when they start, and casual employees must also receive the Casual Employment Information Statement.

When do minimum wages change?

The Fair Work Commission reviews minimum wages every year in its Annual Wage Review, and increases usually apply from the first full pay period starting on or after 1 July.

For 2026, the Commission handed down its decision on 2 June 2026. Modern award minimum wages increased by 4.75%, and the National Minimum Wage rose to $26.44 an hour, both from the first full pay period starting on or after 1 July 2026.

Award rates, allowances and penalty rates all need to be updated in your payroll each July. Use the FWO’s pay guides or Pay Calculator rather than adding a percentage yourself, because allowances and some classifications do not move by the headline figure.

What do you owe apprentices?

Apprentices are employees. They get the NES and the pay and conditions in their award, including apprentice wage rates that are set as a percentage of the relevant tradesperson rate and that progress through the apprenticeship.

Training obligations are set by the award, and they vary. For example:

• Electrical contracting award. Time spent at training or assessment under the training contract counts as time worked for calculating wages, and the employer must reimburse fees paid to the training provider, less any government reimbursement.
• Plumbing and Fire Sprinklers Award. The employer must reimburse fees for prescribed courses and prescribed textbooks connected with the training contract, within set time limits.

Check the apprentice clauses of your award, including adult apprentice rates, tool allowances and travel to training. Apprentices are often young workers, so supervision and site induction need extra care.

Why do records and pay slips matter more than ever?

The Fair Work Act requires employers to keep time and wage records for each employee and to issue pay slips. According to the FWO:

• Pay slips must be given to each employee within one working day of pay day, even if they are on leave, in electronic or hard copy form.
• Employee records must be kept for 7 years, be legible and in English, be readily accessible to a Fair Work Inspector, and not be false or misleading.

Good records are your evidence. Since 1 January 2025, intentionally underpaying wages or other entitlements can be a criminal offence, punishable by fines, imprisonment or both. The FWO is clear that honest mistakes are not caught.

For small business employers with fewer than 15 employees, the Voluntary Small Business Wage Compliance Code matters. The FWO says it cannot refer a small business employer for criminal prosecution over an underpayment if it is satisfied the employer complied with the Code. Accurate records, correct award rates and prompt fixing of mistakes are the practical way to show that.

Construction also has state-based portable long service leave schemes, which can require employers to register workers and report service. Check the scheme in each state where your workers are employed.

What has changed with superannuation?

Two changes affect every employer:

• 12% super guarantee. The super guarantee rate rose from 11.5% to 12% on 1 July 2025, the final scheduled increase.
• Payday Super. From 1 July 2026, employers must pay super for each payday instead of quarterly. The ATO says contributions are due in the employee’s super fund within 7 business days after payday, with longer allowed in some cases such as new employees, and super is calculated on the employee’s qualifying earnings.

Payday Super changes cash flow, because super leaves your account every pay run rather than once a quarter. The ATO has said that in the first year, employers who try to do the right thing and fix problems quickly will not be the focus of its compliance action.

Super can also be owed to some contractors. A contractor paid wholly or principally for their labour can be treated as an employee for super purposes, even if they have an ABN — see engaging subcontractors.

What is the right to disconnect?

Employees have a right to refuse to monitor, read or respond to contact, or attempted contact, outside their working hours, unless the refusal is unreasonable. The contact can be from the employer or a third party such as a client. It started on 26 August 2024 for most employers and on 26 August 2025 for small business employers with fewer than 15 employees.

Whether a refusal is unreasonable depends on factors such as:

• the reason for the contact;
• the employee’s role and level of responsibility;
• the employee’s personal circumstances, including caring responsibilities;
• how the contact is made and how disruptive it is; and
• whether the employee is paid to be available or work extra hours.

The right does not stop you contacting employees, and genuine emergencies on site will often justify contact. You must not take adverse action against an employee for exercising the right. Agreeing clear after-hours arrangements, and paying for on-call time where the award requires it, avoids most disputes.

Fair Work checklist for building businesses

• System. Confirm you are in the national system, especially in Western Australia.
• Award. Identify the right award and classification for each employee.
• Rates updated. Apply the new award rates and allowances from the first full pay period on or after 1 July.
• Information statements. Give the Fair Work Information Statement, and the casual statement where relevant, to every new starter.
• Apprentices. Check apprentice rates, training time and fee reimbursement in the award.
• Pay slips. Issue within one working day of pay day.
• Records. Keep time and wage records for 7 years.
• Super on payday. 12% of qualifying earnings, reaching the fund within 7 business days.
• Contractors. Check genuine contractor status and super for labour-only contracts.
• After-hours contact. Set clear, reasonable arrangements consistent with the right to disconnect.

Frequently asked questions