Australia (1)

Title of the survey

Survey of Employee Earnings and Hours (SEEH)

Organization responsible

Australian Bureau of Statistics (ABS)

Periodicity of the survey

Annual, in May.

Objectives of the survey

To provide statistics on the distribution of employees according to weekly earnings and hours of work, and on the composition of weekly earnings and hours for various categories of employees and their principal occupations. The survey results provide detailed information on the size and movements in base pay, overaward and overagreement earnings, and on inter-occupational and within occupation shifts in earnings. This information is used by government agencies to monitor the Australian economy and formulate economic policy, and by research institutions for the purpose of labour market studies.

Main labour topics covered by the survey

Employment, earnings and hours of work.

Reference period

The last pay period ending in or before the third week of May.

Coverage of the survey

Geographical

The whole country.

Industrial

All branches of economic activity, except agriculture, hunting, forestry and fishing; the Australian permanent defence forces; private households employing staff; and overseas embassies, consulates, etc.

Establishments

All types and sizes of establishments which have paid employees.

Persons

All employees in the branches of economic activity covered. Employees based outside Australia are excluded. Excluded are the following persons who are not considered as employees: directors who are not paid a salary; proprietors and partners of unincorporated businesses; self-employed workers such as subcontractors, owner-drivers, consultants and persons solely paid by commission without a retainer; and unpaid family workers.

Occupations

All occupations are covered. The actual occupation reported on depends on the particular employee selected in the sample (see Sample design).

Concepts and definitions

Employment

Data on employment refer to employees, i.e. all wage and salary earners who received pay for any part of the reference period. They include full-time and part-time employees; permanent, temporary and casual employees; managerial and executive employees; employees who commenced or finished work during the reference period; employees absent on paid or prepaid leave (e.g. annual leave, long-service leave). Working proprietors of incorporated businesses and working directors who are paid a salary, and commission agents who receive a retainer as well as their commission, are included, but not separately identified. Also included are apprentices, trainees and workers on probation; piece workers; and workers from temporary work agencies paid through the payroll. Persons temporarily absent from work because of sickness or accident are included, but not separately identified, if they received workers' compensation or sick pay through the payroll. Persons temporarily absent from work for other reasons, whether authorised or not, including persons on temporary military service, are included provided they received pay through the payroll. Persons temporarily present on payroll during the notice period preceding retirement, resignation or dismissal are also included. Excluded are all employees who did not receive any pay during the reference period (e.g. employees on workers' compensation who are not paid through the payroll, employees on leave without pay, on strike or stood down), home workers and workers sub-contracted from other companies or firms. The following categories of workers are separately identified:

adult employees: employees aged 21 and over and those employees who, although under 21 years of age, are paid at the full adult rate for their occupation;
junior employees: those under 21 years of age who are not paid at the adult rate;
permanent employees: employees who are entitled to paid annual leave;
temporary or casual employees: those employed usually on a short-term basis and/or who receive a higher rate of pay to compensate for lack of permanency entitlements;
full-time employees: those permanent, temporary or casual 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 ordinarily work 35 hours or more a week;
part-time employees are those (permanent, temporary or casual) who are not full-time as defined above;
working proprietor or director of own incorporated business;
managerial, executive or senior professional: managerial or executive employees, e.g. those employees who are in charge of a significant number of employees or have significant responsibilities in the conduct or operations of the organization and may not receive payment for overtime; include professionally qualified staff who primarily perform managerial tasks in conjunction with utilising their professional skills;
apprentice: apprentice, trainee or cadet;
other employee: employees not elsewhere classified, including supervisors, clerical staff, tradepersons and non-managerial professionals.

Earnings

For each employee, data are collected on total gross weekly earnings and their components, i.e. on one week's earnings related to the reference period, prior to taxation and other deductions (e.g. for superannuation, board and lodging). Payments which are not made weekly (e.g. monthly or fortnightly salaries, periodic payments, etc.) are converted to a weekly figure. Total gross weekly earnings comprise:

weekly ordinary time earnings, i.e. award payments, workplace and enterprise bargaining payments and other agreed base rates of pay, overaward and overagreement payments, penalty payments, shift and other allowances; commissions and retainers; bonuses and similar payments related to the reference period; payments under incentive or piece-work; payments under profit-sharing schemes normally paid each pay period; payments for leave taken during the reference period; all workers' compensation payments made through the payroll; and salary payments made to directors.
weekly overtime earnings, i.e. payments for hours in excess of award, standard or agreed hours of work, including shift penalty payment for overtime hours.

Total gross weekly earnings obtained in respect of each selected employee are divided into:

Base pay, i.e. the award pay or agreed rate of pay for ordinary time hours paid for. It includes base pay from workplace agreements and enterprise bargaining awards and agreements. For employees covered by an award or workplace agreement, it includes all allowances (dirt, height, tool) and penalty payments (e.g. shift loadings) specified in the award or agreement. It excludes overaward and overagreement pay and service increments not specified in the award or agreement. For employees not covered by an award or agreement, base pay is the agreed wage for ordinary time hours paid for.
Overaward and overagreement pay, i.e. amounts of ordinary time pay (regular or otherwise) that are over the award pay or in excess of amounts specified in workplace or enterprise agreements (e.g. attendance, good timekeeping, profit-sharing).
Payment by measured results refer to earnings which vary according to measured performance (e.g. piece-work, production and task bonuses, commissions and similar payments relating to the reference period); commissions paid to sales and other personnel are included, but not separately identified, if these employees receive a wage or salary retainer.
Overtime pay.
Other pay, i.e. any weekly earnings not included in the previous items.

House rent allowances, transport allowances and other allowances paid directly by the employer are included in earnings. Earnings in kind (e.g. food and drink, fuel, clothing) are included (but not separately identified) only if they are included in taxable income as part of the regular payroll system. Regular and semi-regular bonuses and gratuities (in cash) are included in total weekly earnings (but not separately identified) if they are paid during the reference period and converted to a weekly equivalent. Excluded from total weekly earnings are: retrospective pay; pay in advance; leave loadings; irregular or one-off bonuses; severance, termination and redundancy payments; directors' or office holders' fees; and payments in the form of reimbursement for expenses incurred whilst carrying out the employer's business (e.g. payments from petty cash). Benefits other than wages, salaries and supplements that may arise from employment (e.g. concessions such as employers providing goods and services free or at discounted prices, and free or subsidised housing) are also excluded. However, some information on the incidence of such benefits is collected biennially with the Major Labour Costs Survey (MLC). Wages data are collected separately for full- and part-time, managerial and non-managerial, adult and junior, permanent and temporary/casual employees, by sex, occupation and industry.

Wage/salary rates

The objective of the SEEH is not to collect data on wage or salary rates. Statistics of award rates of pay by industry, occupation, sex and state are derived directly from federal or state Arbitration Authorities or collective agreements. However, the SEEH provides the source and weights used for constructing award rates of pay indices.

Hours of work

Data are collected on both weekly normal hours of work and weekly hours paid for, covering non-managerial employees only. Normal hours of work refer to standard or rostered hours of work, excluding overtime, for which the employee would normally be paid in a full week. Normal hours of work are those set by arbitral awards, laws, regulations or collective agreements if the employees are covered by one of these. Otherwise, normal hours refer to establishments' internal regulations or agreements. For casual workers whose hours vary, standard hours are the same as ordinary time hours paid for (see below). Weekly hours paid for are split into:

ordinary time hours paid for, i.e. one week's portion of award, standard or agreed hours of work which were paid for during the reference period, including hours of paid leave related to the reference period, but excluding overtime hours and hours on stand-by or reporting time, unless these are part of standard hours, depending upon award conditions or employment contract;
overtime hours paid for, i.e. those in excess of award, standard or agreed hours of work which were paid for during the reference period, excluding normal shift work and standard hours paid for at penalty rates.

Included in hours paid for, but not separately identified, are study and training periods, whether spent at the workplace or outside the workplace, as well as all inactive periods of time spent outside the workplace for vacation, holidays, sickness or accident, maternity leave, parental leave, personal leave (for births, marriage, family responsibilities), military or related service, civil responsibilities (jury duty, etc.), professional training, trade union and employers' organizations activities, etc. provided the employee received pay during such times. Excluded from hours paid for are meal breaks, work stoppages due to industrial disputes, layoff or short-time working and time spent on travel from home to work and vice versa. For employees paid other than weekly, hours are converted to a weekly basis. For employees who began or ceased work, or were absent without pay for any reason during the reference period, only the hours actually paid for are included. Where agreed hours of work are less than award hours, hours are based on agreed hours. Hours of work are not reported for managerial employees. Data on hours of work are measured in hours and minutes.

International recommendations

The ABS definition of earnings complies with the international recommendations, with the following exception: the value of payments in kind (such as food and drink, fuel, clothing) and housing and rent allowances are included only if these elements are included in taxable income as part of the regular payroll system. The definition of hours of work used in this survey corresponds to the concept of hours paid for.

Classifications

Industrial

Up to and including the May 1993 survey, data on employment, earnings and hours of work were classified according to 19 groups, at the two-digit level of the Australian Standard Industrial Classification (ASIC-1983). This classification is convertible to the International Standard Industrial Classification of all economic activities (ISIC), Rev. 2, 1968 at the four-digit level. Starting with the May 1994 survey, the Australian and New Zealand Standard Industrial Classification (ANZSIC), 1993, has been used. This classification is convertible to the International Standard Classification of all economic activities (ISIC), Rev. 3, 1990 at the four-digit level.

Occupational

Data on employment, earnings and hours of work are classified according to 282 groups, at the four-digit level of the Australian Standard Classification of Occupations (ASCO). Occupations are coded on the basis of the title and job description as indicated by the reporting unit. Some of the ASCO concepts used are consistent with the International Standard Classification of Occupations (ISCO-88).

Others

The survey data are classified by state and territory, sector (public or private), employment size and according to the following characteristics of employees:

sex
adult/junior
managerial/other
full and part-time

Sample size and design

Statistical unit

The statistical unit used to compile SEEH statistics is termed the state-management unit. It comprises all activities of a business within a particular state or territory. Each unit is classified to an industry which reflects the predominant activity of the business in the state or territory. In cases where a business has significant employment in more than one industry, a separate statistical unit is created for each industry. When respondents supply information from more than one reporting unit, these are aggregated to the sample unit. The ultimate unit of inquiry is the individual employee, with his or her occupation and characteristics.

Survey universe / sample frame

The survey sample is selected from a common statistical frame, the ABS Business Register, which covers all sectors of the economy and most forms of entities engaged in economic activity. It includes companies, sole proprietorships, self-employed professionals, all government agencies, community service organizations, religious organizations, etc. However, businesses are usually only included in the register if they have paid employees, with one major exception: agriculture, where establishments are included if they have an estimated value of agricultural operations of at least 5,000 dollars, even if they have no paid employees. The register is regularly updated to take account of new businesses, takeovers and mergers, changes to industry classification, changes in employment and businesses which have ceased operation. Major sources for updating the information on the register include the Australian Taxation Office, group employer registrations, unit surveys carried out by the ABS Business Register, updating of large enterprise groups by the ABS Business Register and feedback from ABS collection areas. The unit recorded on the ABS Business Register and used in creating the population framework for the SEEH is called the management unit. This unit is the highest level accounting unit within a business, having regard for industry homogeneity, for which accounts are maintained. In nearly all cases, it coincides with the legal entity owning the business (company, partnership, trust, sole proprietorship, etc.). The operations of the management unit are dissected by state, using location and establishment ASIC and employment information stored on the ABS Business Register, to form state-management units (SMUs). The SMUs are then used to compile SEEH statistics. The framework population consists of all management units on the Register at a point of time, except for those sectors of the economy which are excluded from the scope of the survey (see Coverage of the survey). The management units are then replaced with management-state-industry units. The framework population is approximately 600,000 units. This includes units which are in scope and found to be defunct or have permanently no paid employees.

Sample design

The sample design follows a stratified two-stage approach. At the first stage, a sample of approximately 8,500 employers is selected from the ABS Business Register to ensure adequate state and industry representation. Statistical units are stratified by state or territory, public and private sector, industry and employment size. An equal probability sample is selected from each stratum. In some strata, notably those with the largest employers' size, all units are included with certainty in the sample. At the second stage, a procedure is set up for drawing a sample of employees within each enterprise, which leads to a sample of some 75,000 employees. Selected employers with fewer than 10 employees are required to complete separate details for every employee. Employers with 10 or more employees are required to select a random sample of their employees in accordance with instructions supplied by the ABS and to provide details for those employees. In that case, employers have to assemble, in any order, a complete list of the employees who received pay for any part of the reference period (inclusions and exclusions are specified in the questionnaire); then the respondents are instructed to start with the xth employee on the list and from then, to select every xth employee until the end of the list. For every selected employee, employers are required to complete separate details, including a description of the main tasks and duties usually performed by the employee. This selection procedure is designed to produce a representative sample of employees in Australia, even though it might not produce a representative sample of employees within each individual unit. There is a planned rotation of approximately 38 per cent across the total population per year. There is no maximum number of times a sampled unit is surveyed. The sample is completely renewed after three years.

Field work

Data collection

This takes place in May of each year. The survey is conducted by mail by the ABS; questionnaires are sent out before the reference date and are due to be returned two weeks after the reference date.

Survey questionnaire

This comprises 22 questions and can be filled in for up to six individual employees. It consists of sets of questions on:

total employment of the organization;
identification of each selected employee (sex, adult or junior, permanent, temporary or casual, full-time or part-time, status of employee, occupational title, main tasks and duties);
for each employee (starting with the May 1994 survey), whether the employee is covered by an award or agreement or a formalized enterprise bargaining agreement, or none of the above. Coverage is further divided into federal or state industrial relations jurisdiction;
for each employee, base pay, allowances, overaward or overagreement pay, payment by measured results, overtime pay, other pay, pay in advance, retrospective pay and periodic bonuses, and total weekly earnings;
for each employee, weekly standard or rostered hours, weekly hours paid for, i.e. ordinary time hours paid for, overtime hours paid for and total hours paid for;
a separate question gives the employer the possibility of adding comments on any unusual features affecting individual employee's earnings or hours.

Instructions are provided along with the questionnaire, which cover:

general information on the purpose of the survey, collection authority, confidentiality, due date, help available and estimates;
instructions regarding the reference period and the procedure to be followed to select the sample of employees;
specific inclusions and exclusions with regard to the characteristics of employees and the components of earnings and hours of work;
the use of the data required from the respondents.

Substitution of sampling units

There is no substitution of sampling units in the case of total non-response. Telephone and mail reminders are used to follow-up on non-respondents. The location of any unit which is not found is checked, on the basis of the Business Register or other surveys.

Data processing and editing

Data are processed both manually and by computer. Coding of occupations is carried out manually with the aid of a computer programme which gives choices for manual decisions. Each employer's employees are coded manually in ascending order. Data are edited through computer programmes which have pre-set ranges and consistency tolerances that are expected for data items, on the basis of information available from the previous year and other surveys. Machine editing is completed by some manual editing. In the case of missing or inconsistent data, respondents are contacted by telephone or visit for editing queries. In the case of item non-response, missing data are dealt with by imputation. If the reference period used for data collection presents abnormal circumstances (e.g. strikes, public holidays, fire, flood), details are collected for the pay period prior to the one originally specified. However, if it is a long-term breakdown, data are required for the original period with an explanation for the breakdown.

Types of estimates

The following estimates of earnings and hours paid for are made from the survey data: weekly and hourly averages for Australia, states and territories, medians and composition of earnings by base rate of pay, overtime, overaward and overagreement pay, and payments by measured results; distribution of employees by levels of earnings, and percentages of employees, according to various characteristics (for individual occupations, occupational groups and industry).

Construction of indices

None.

Weighting of sample results

The formulae used to expand the sample results follow the survey design, whereby the first stage units are employers and the second stage units are employees. Estimates are derived using the number raised estimation method, as follows:

where,

M=: population of employers,
m=: sample number of employers,
N=: population of employees,
n=: sample number of employees,
h=: stratum,
j=: reporting unit,
i=: the i^th population unit.

Adjustments

Non-response

None

Other bias

None.

Use of benchmark data

Not relevant.

Seasonal variations

None.

Indicators of reliability of the estimates

Coverage of the sampling frame

Every effort is made to cover all industries within the scope of the survey.

Sampling error / sampling variance

The standard error of estimate is: 1.0 per cent for employment, 0.3 per cent for earnings of adult persons, and 0.1 per cent for hours of work.

Non-response rate

The standard non-response rate averages 1 per cent.

Non-sampling errors

Inaccuracies may occur because of misinterpretation of questionnaires by respondents, errors made in coding and processing data, subjective decisions taken by editors, ambiguous questions, etc. Every effort is made to reduce non-sampling errors to a minimum by careful design of the questionnaire and instructions and efficient operating procedures.

Conformity with other sources

The survey results are compared to the results of other surveys that collect similar data. Comparability with the quarterly Survey of Average Weekly Earnings is achieved via the use of a common statistical frame from which the sample is selected (with a substantial overlap of employers selected in both surveys), a common reference date and data definitions.

Available series

Published tables include detailed, four-digit occupational listings of ordinary time and total weekly hours and earnings, along with very detailed (43 categories) distributional information on earnings at one-digit industry and occupational levels. Detailed cross-tabulations of estimates of totals, averages, distribution, percentages, medians and composition of hourly and weekly earnings and hours paid for are available for the following categories of employees:

males and females
adults and juniors
full- and part-time
managerial (covering adult full-time employees) and non-managerial (covering separately adult full- and part-time and junior full- and part-time employees),

by state and territory, industry group, occupational group and sector.

History of the survey

The SEEH was introduced in 1974 and conducted annually in May, until 1981. No survey was conducted in 1982 and 1984, due to budget constraints, but it was carried out in 1983 and 1985, and restored to an annual frequency in 1986. After 1981, improved coverage of employers by the ABS Business Register and modifications brought to some definitions have resulted in survey results not being strictly comparable with surveys conducted between 1974 and 1981. In 1986, the Australian Standard Classification of Occupations (ASCO) replaced the Classification and Classified List of Occupations (CCLO). Starting with the May 1994 survey, the Australian and New Zealand Standard Industrial Classification (ANZSIC), 1993, has replaced the Australian Standard Industrial Classification (ASIC-1983).

Documentation

Australian Bureau of Statistics: Distribution and Composition of Employee Earnings and Hours - Australia, Preliminary (catalogue No. 6305.0) (annual; Canberra); published approximately six months after the survey reference period. idem: Distribution and Composition of Employee Earnings and Hours - Australia (catalogue No. 6306.0) (annual; ibid.); published approximately 10 months after the survey reference period. For methodological information, see: idem: Statistics on Wages, Earnings, Income and Labour Costs - A guide to their concepts, measurements and usage, Occasional paper No. 1986/1 (ibid.). In addition to the data that appear in national publications, a range of unpublished data is available from the SEEH, on request and for a fee, depending on the type of information required and the resources needed to process the request. Populations and variables available refer to:

categories of employees;
composition of earnings and composition of hours paid for;
average hourly earnings;
distribution of employees by various levels of earnings and hours;
data by state and territory, sector, industry and occupation, sex and size of establishment or enterprise.

Data can also be made available on floppy disk, upon request.

Confidentiality / Reliability criteria

The publication and release of data are subject to confidentiality rules: strata with less than three employees contributing to them are suppressed from the statistics on occupations.

Other information

Data supplied to the ILO for publication

The following data derived from the SEEH are published in the Yearbook of Labour Statistics:

Paid employment in non-agricultural activities, manufacturing (all industries), mining and quarrying, construction, and transport, storage and communication, by sex;
Average hours paid for in the same divisions of economic activity, since 1989, by sex;
Average hourly earnings in the same divisions of economic activity, since 1990, by sex.

The series of average hours of work and average earnings derived from the SEEH replaced the series derived from the Survey of Average Weekly Earnings published in the Yearbook up to 1989 and 1990, respectively. Data on average hours paid for and average hourly earnings of full-time adult non-managerial employees in ISIC major divisions 4, 6, 8 and 9 are stored in the ILO database. Data on average weekly ordinary time earnings and normal hours, and average weekly total earnings and hours paid for, by occupation and industry are published each year, since the 1992 edition, in Statistics on occupational wages and hours of work and on food prices - October Inquiry results, a special supplement to the Bulletin of Labour Statistics. In previous editions of this Bulletin, the data referred to basic award rates of pay, derived from federal and state Arbitration Authorities or collective agreements. For further methodological details on this series, see ILO Statistical Sources and Methods, Volume 4.

Other sources of data

Statistics of employment in manufacturing, by major group of industry, published in Table 5B of the Yearbook of Labour Statistics are derived from the annual Census of Manufacturing. The census covers all establishments operating at 30 June of each year, excluding single establishment enterprises with less than four persons employed. These data are therefore not strictly comparable with employment data published in the other tables of the Yearbook.