Navigating SCHADS Award Complexity with CheckUP Australia

Advanced SCHADS Award Compliance – Practical Application & Risk Areas (with CheckUP Australia) - Recorded 24 June 2025

This webinar builds on the fundamentals of SCHADS Award compliance and explores more complex and higher-risk areas employers commonly encounter.

Delivered in partnership with CheckUP Australia, the session focuses on practical application of the Award, common compliance traps, and how employers can reduce exposure in day-to-day operations.

While this session follows on from an introductory SCHADS webinar, it is designed to stand alone and provides valuable insights for employers with an existing understanding of SCHADS Award obligations.

Webinar Transcript

Automatic transcription:

Afternoon everyone and welcome back for part two of our SCHADS Award webinar series in collaboration with CheckUP. We're so glad to have you with us again as we continue to explore the complexities of this award and how to manage them confidently. Last month we covered the foundational elements of the SCHADS Award and the importance of proactive compliance. Today we're diving deeper into the more advanced and often misunderstood aspects of the award, especially those that create operational headaches if not managed properly. As always, our aim is to cut through the complexity and give you practical guidance that supports compliance, reduces risk, and makes managing your workforce that a little bit easier.

Now please note that today's webinar is general in nature and doesn't take into account your individual circumstances. If you do need advice or support specific to your organisation, please reach out to Effective HR or CheckUP for assistance. Today we're focusing on some key areas where we commonly see issues within SCHADS workplaces. We'll cover broken shifts, sleepovers, overtime, allowances, and some record keeping and compliance expectations.

If you were with us for part one, you'll remember we covered award coverage, classifications, minimum engagement, and the structure of SCHADS. We also spoke about why SCHADS is often misunderstood because it reads simpler than it operates in practice. Once you apply the award to real rosters, real service delivery requirements, and real clients, the interactions between clauses become far more complex.

One of the biggest risk areas we see is rostering and shift design. Businesses often build rosters around operational needs, but the award has specific requirements around span of hours, minimum engagements, broken shifts, and what constitutes ordinary hours. When those award rules aren't considered at the rostering stage, businesses can unintentionally create underpayment risk across large groups of employees.

We also see a lot of confusion around allowances and when they apply. SCHADS includes a range of allowances which are not always triggered consistently. Whether an allowance applies depends on the nature of the work being performed, when it is performed, and the circumstances in which it occurs. Applying a flat allowance or assuming an allowance applies universally can create compliance issues quickly.

Sleepovers are another major pressure point. The SCHADS Award contains specific provisions about sleepover payments, what constitutes an interruption, how interruptions are recorded, and what an employee must be paid if they perform work during the sleepover period. We often see sleepovers treated as a set and forget arrangement, with interruptions not being captured, not being paid correctly, or not being documented appropriately.

Broken shifts are commonly misunderstood as well. Broken shifts can be permitted under SCHADS, but there are rules around the broken shift allowance and the way the shift is structured across the day. Where broken shifts become frequent or are applied without the correct allowance, underpayment risks can compound quickly across a roster cycle.

Overtime is another area where we see issues arise, particularly when businesses assume that hours can be averaged or that overtime triggers operate the same way as other awards. Under SCHADS, overtime can be triggered earlier than expected depending on how hours are worked across the day and week. This is particularly relevant where employees perform varying shifts, where hours fluctuate, or where there is a high level of operational variability across services.

Record keeping is an essential component of award compliance. Even where an organisation believes it is paying correctly, poor records can expose the business if there is a complaint, a claim, or an audit. Timesheets, rosters, and payslips need to accurately capture hours worked, breaks taken, allowances applied, and any variations to ordinary hours. Where records are incomplete or inconsistent, it becomes difficult to demonstrate compliance.

Another risk area is classification drift. Over time, employees can take on additional responsibilities or higher level duties, while their SCHADS classification remains unchanged. This can create misclassification risk, and where it occurs across teams, it can result in systemic issues that are harder to remediate.

It is important that managers, payroll, and HR teams work closely together. Decisions made at an operational level have payroll and compliance implications. When rostering, service delivery, and payroll operate in silos, errors become more likely. A consistent approach to interpretation, documentation, and review is critical.

Today we're going to work through examples and common scenarios to help you understand where these risks sit in practice. The aim is not to overwhelm you, but to highlight the key pressure points so you can focus your review effort in the right areas. Early identification and correction of issues is far easier than managing systemic problems that have been running for a long period.

We'll start with broken shifts, including the definition of a broken shift, when the broken shift allowance applies, and common errors we see in practice. We'll then move into sleepovers and interruptions, including recording practices and payment expectations. We'll cover overtime triggers and how overtime can apply depending on daily and weekly hours. We'll also cover allowances and the need to apply them correctly based on the work performed. We'll finish with record keeping expectations and practical tips to reduce risk.

If you are unsure whether your current arrangements are compliant, a targeted review or payroll audit can assist. The benefit of doing this proactively is that it allows you to identify issues early, quantify risk, and take practical steps to remediate before matters escalate into complaints, disputes, or enforcement action.

We also encourage businesses to approach SCHADS compliance as an ongoing process, rather than a once off exercise. This includes periodic review of rosters, classifications, and payroll setup, as well as regular checks to ensure that allowances and overtime are being applied correctly.

As we go through today, if you have questions, please submit them and we will address them as we move through the content where possible. If we don't get to a question during the webinar, we will follow up after the session.

Thank you again for joining us. We'll now move into the first section.

We are now going to look at broken shifts. Under the SCHADS Award, broken shifts are a specific rostering arrangement where an employee has a break in their hours of work that is unpaid and separates the work into two periods. There are rules around when broken shifts can occur, how they are structured, and how the allowance applies.

A common issue we see is businesses applying broken shifts without paying the broken shift allowance. Another issue is where rosters are designed with multiple breaks that may not align with what the award permits, creating further compliance issues. It is important to review how rosters are built, how breaks are treated, and whether the allowance is being applied correctly.

When reviewing broken shifts, you need to consider the total span of hours, the unpaid break between the two work periods, and the circumstances that lead to the broken shift arrangement. In practice, broken shifts can be common in disability and community services where client needs create gaps in service delivery across the day.

We also see issues where rosters are labelled as broken shifts but are actually something else under the award, or where the break is treated incorrectly. Clear definitions, consistent recording, and correct payroll configuration are key to compliance.

Moving now to sleepovers. Sleepovers are another area where compliance risks are common. The award sets out how sleepovers are paid and what happens when the employee is required to perform work during the sleepover period. Interruptions need to be captured, recorded, and paid correctly.

A common issue is where interruptions occur but are not recorded, or where they are recorded but not paid correctly. Another issue is where the business does not have a consistent process for capturing interruptions, or where employees are unsure how to report them. This creates both compliance and operational risk.

When reviewing sleepovers, you should consider how sleepovers are scheduled, how interruptions are captured, and whether payroll is configured correctly. You should also review whether records are being retained appropriately and whether managers understand the expectations.

We now move to overtime. Overtime under SCHADS can be triggered based on daily and weekly hours, and the triggers may not align with assumptions businesses hold based on other awards. Overtime can apply earlier than expected depending on how hours are worked across the roster cycle.

Common issues include businesses averaging hours across pay periods when that is not permitted, or failing to identify overtime triggers where employees work extended shifts or additional hours across the week. Another issue is where payroll systems are not configured correctly to apply overtime in line with SCHADS requirements.

When reviewing overtime, you should consider how ordinary hours are defined, how additional hours are approved and recorded, and whether overtime is being paid correctly. It is also important to review whether there are consistent practices across managers and teams.

Allowances are another key area. SCHADS includes various allowances that may apply depending on the duties performed and the conditions of work. These allowances need to be applied correctly and consistently. Common issues include applying allowances incorrectly, failing to apply allowances when required, or applying allowances as a flat approach without regard to the actual trigger.

Reviewing allowances requires understanding the work performed, how duties are assigned, and how payroll applies those entitlements. This often requires collaboration between operational leaders and payroll teams.

Finally, record keeping and documentation. The award and Fair Work requirements set expectations around payslips, timesheets, rosters, and employment records. Businesses must retain and maintain accurate records. Even where pay appears correct, record keeping failures can create compliance risk.

We encourage businesses to have clear processes for time recording, approvals, roster management, and payroll reconciliation. Regular spot checks can identify issues early and help businesses maintain compliance over time.

If there is one key takeaway from today's session, it is that SCHADS compliance is highly practical and operational. The best way to reduce risk is to embed award considerations into rostering, ensure payroll is configured correctly, and maintain strong record keeping and review practices.

If you would like support, Effective HR and CheckUP can assist with targeted audits, award interpretation, rostering reviews, payroll configuration checks, and remediation planning where issues are identified.

Thank you again for attending today's session. We hope you found this useful and feel more confident in managing SCHADS compliance. We do have part three coming up on the 26th of August at 12 pm. Part three will be covering managing engagement and rostering for workforce efficiency. So please register and we will see you back in August on the 26. Thank you everyone. Thanks guys.

Important information

This webinar is provided for general information purposes only and does not constitute legal, industrial relations, or human resources advice. The information shared reflects the position and understanding at the time of recording.

Workplace laws, Fair Work decisions, awards, and compliance obligations can change frequently and may vary depending on your specific circumstances.

Before making any decisions that may affect your business or employees, you should seek independent, professional advice tailored to your situation. For further support, guidance, or tailored HR advice, contact our team.