Minimum wages for pieceworkers

The rules have changed how some farms pay workers.  When working on piece-work you are now entitled to a minimum wage.  However, what might seem like good news has a sting in the tail.

The upside of piecework

For almost forever, a characteristic of working on Australian horticulture farms has been payment by the quantity of fruit picked.  While this is a great deal for experienced, fast workers, it has been not so much for learners or for those who cannot, or are not motivated to pick quickly.  This system is known as piecework and has just undergone some big changes.

There are two big advantages of this system of payment for workers.  First is the ability of fast workers to earn above hourly wages – often well above, and the second has been that slow workers would still be employed even if their productivity was low.  This is because the cost per unit of production for the farmer remained the same regardless of the different hourly earnings of the workers.

Minimum wage introduced

However, from 28 April 2022 any farm operating under the Horticulture Award must now pay at least the minimum wage for a pieceworker, regardless of their level of productivity.  While this sounds like good news for slow workers, it is a double-edged sword. 

Because wages are usually the largest operating overhead of a fruit property, any increase will hit the bottom line of that farm business hard.  Paying the minimum wage to a worker with low productivity will not be tolerated because wages paid, even at the minimum level, will contribute to an increase in the cost of production per unit.

This means that a worker who does not pick at a speed at least consistent with the wage level they are earning, will be expected to increase their speed to at least match that level.  And it will be a logical business decision that any worker who cannot increase their speed to that level will lose their job and be replaced by an employee who can. 

Winners and losers

An upside to this is that all farms continuing to pay piecerates will now be motivated to induct and train their workforce more thoroughly when they start, because it is in their interests for new workers to get up to an acceptable speed quickly.  And for those that do, it will be a win-win situation. 

However, there are likely to be several cohorts that are the losers under this new regime:

• Grey nomads who can no longer work at an acceptable pace.  The ability to top up a pension or superannuation, or simply use work as a means to engage in the community, is likely to no longer be available to them.
• Backpackers who wish to use fruit picking to qualify for second or third-year extensions to their Working Holiday Visas. Individuals who are not experienced in the outdoors, not work-hardened, or are more interested in the holiday part of the Working Holiday Visa, may lose this option of accumulating the working days required to qualify if they cannot get up to speed.
• Students wishing to work during semester breaks.  Without continuous work and the accompanying fitness, students may struggle to attain or maintain the speed required in the short bursts they have available to them.
• Anyone else in the community that used piecework to remain occupied and engaged with those around them, where earnings were a secondary reason to work, and a low hourly rate was considered acceptable to gain those benefits. 

There’s always been hourly-paid jobs

For anyone in any of these groups who are concerned they will not be able to attain the required picking speed to keep their job, there are still options. Most farms have other tasks that have always been hourly paid. 

This includes shed-work where cleaning, grading and packing of fruit for transport to the market are undertaken.  Driving tractors and other machinery, maintaining irrigation or other infrastructure, or even administration tasks will still exist.  And for experienced workers there are often supervision or training roles that are available. 

Of course, each of these will also require a level of productivity to keep the boss happy.  But if the speed-limiting issues are fitness, agility or coordination, other non-picking roles may be a suitable alternative.

Piecework still available

It is important to note that piecework is still a legal way to employ someone to pick fruit, and many farms will maintain this method to retain highly productive workers that will continue to be rewarded with above-Award wages.  Other farms, for simplicity, will switch to hourly payments only.  So, for anyone who can work fast, or believes they can learn and build up speed quickly, a farm that still offers piecework may still be the best option. 

Also, these recent changes only apply to the Horticulture Award.  There are other ‘industrial instruments’ that determine wages such as the Wine Award that still allows piecerates for picking of wine grapes.  The rules are slightly different, but there remains no minimum wage.

Knowledge is power

For a worker it is important to know in advance how wages are going to paid, especially if there is a third-party such as a labour hire contractor involved.  Before you start, things you should know include:

• Who is the employer – the farm or a contractor?  You will need at least a name, contact number, and the ABN of that employer.
• Which ‘award’ the work is required to be paid under?   In some cases, a farm will have their own Enterprise Agreement.  These Agreements often have different working conditions, and wages may be structured differently.  Ensure you can access the document you work under so you understand your entitlements and obligations.
• If piecerates are paid, what the rates are and for what tasks?  A written document (which may be electronic) outlining these details, signed by the employer, must be provided to you before you start a piecework job.
• How working hours will be tracked.  This is not only for hourly-paid work but also for piecework.

For workers considering joining the Australia seasonal farm workforce for the fruit and vegetable industries, although there is now the safety of a minimum wage floor, the pressure will be on to learn quickly and perform productively.  Those that can will have the advantages of working in the great Australian outdoors, with options to roam the country and see new places, and be employed and engage with the local community while they do so. 

But knowledge has always been power, so make sure you know what you are considering.