How to manage the right to disconnect

How to manage the right to disconnect

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How to manage the right to disconnect

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From 26 August 2024, employers with 15 or more employees have to respect employees’ right to disconnect from work outside their contracted working hours. Smaller employers will have those obligations 12 months later. What does it mean for your business and what do you need to do?  

What is the right to disconnect?

Here is how it is described in the Fact Sheet published by the Department of Employment and Workplace Relations:

“The right to disconnect will inform how employers and employees interact outside  of working hours. The right does not prohibit employers from contacting their employees, nor does it prevent employees from contacting each other, including across time zones. Rather, the employee will be able to refuse to monitor, read or respond to contact, or attempted contact outside of working hours, when they are not expected to be working or paid to be working, so long as doing so is not unreasonable.” 

So it doesn’t prohibit making contact with employees outside their contracted working hours – it just provides that they don’t have to respond to such contact outside their contracted working hours other than in limited circumstances.

The real obligations on employers are to not unreasonably require someone to respond to contact after hours and not to penalise people for exercising their right to disconnect. 

Inclusion in modern awards

The Fair Work Commission has been tasked with inserting “right to disconnect” clauses in modern awards. 

The approach it is taking is to have a standard clause which is customised according to existing provisions in Awards which might have relevance to contact after hours such as standby or call back or roster change provisions. 

So you need to consider which awards cover your employees, what provisions they might have in regard to out of hours contact and how those provisions relate to your own operations.

It is also something that you will need to consider in enterprise agreements.

What do you need to do?

In our blog back in February on Managing disconnection from work, we noted that this really should not be that big an issue for most organisations so the first thing you should do is ignore all of the hype about it. 

Then you should undertake a constructive assessment of the effects for your organisation and your people by answering the following questions:

  • Are there any situations where employees in your organisations need to be responsive to contact outside their standard working hours for genuine operational reasons?
  • Are there provisions in a modern award or enterprise agreement which deal with the specific type or cause of contact eg someone being on standby or being called back or being contacted about a roster change or some other prescribed matter outside their standard working hours?
  • Are employees remunerated for making themselves available for contact outside working hours under the provisions of a modern award or enterprise agreement or otherwise under their contract of employment?
  • Do you have any employees who have flexibility in their hours and location of work and whose working hours might fall outside standard operating hours via a flexible working arrangement or agreement or by individual choice?
  • Do you have any protocols in place regarding out of hours contact for people who may be working outside standard working hours eg contact to other staff or external parties should only be via email with the scheduling function used to delay transmission until the start of the following working day?
  • Do you have any protocols in place with external parties in relation to their contact and their response expectations with your staff outside standard working hours?
  • Do any of your people have to operate across timezones which might cause communications to occur outside an employee’s standard working hours?
  • Do any of your managers unreasonably or unnecessarily send communications to their people outside their standard working hours, expecting them to respond outside those hours?
  • Do any external parties unreasonably and unnecessarily send communications to your people outside their standard working hours, expecting them to respond outside those hours?
  • Do you have people who you know will respond to out of hours contacts even if you don’t want them to?
  • Do you deal with out of hours contact requirements in your contracts of employment?
  • Do you verify adequacy of remuneration having regard to out of hours contact requirements where an employee is expected to respond to specified contacts?
  • Do you deal with out of hours contact happenings in your performance and development conversations?
  • Do you have a properly structured and communicated “Life balance policy” which includes details on the organisation’s expectations and processes for management of out of hours contact and the employee right to disconnect? 

Other tips

As with any matter around people and culture, we encourage you to look at these things on 3 levels – organisational, team and individual – and please do that by engaging with your people in determining what the realities for your business and people are and covering off all of the bases. 

Remember it is about your business and your people so don’t just borrow or buy a policy statement from someone else and remember our 4C compliance model because unless you do all 4Cs, you are not truly compliant:

  • Commitment – the fundamentals that deliver purpose and compliance
  • Capability – the tools and systems that enable good people practice
  • Competency – the skills and knowledge that deliver positive outcomes for businesses and people
  • Culture – the integration of all of that to deliver everyday employee engagement and high performance.

How we can help?

We can hep you to get the right answers to all of the questions that we have said you need to be asking in determining how your business is going to responsibly manage your employees’ right to disconnect.

We can advise you on remuneration in line wth award provisions and we can be-you with policies and employment contracts as well as advices to ay “problem individuals” who might need to modify their habits so as not to interfere with other employees’ right to disconnect.

If you would like to learn more about ways that we help with this or any other HR issue, please call us on 1300 108 488 or email us at enquiries@ridgelinehr.com.au.

CONTACT US

Ridgeline Human Resources Pty Ltd
ABN : 24 091 644 094

enquiries@ridgelinehr.com.au

6 Ellesmere Ave, Croydon Victoria 3136

1300 108 488

PARTNER LINKS

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Annual Wage Review decision is in

Annual Wage Review decision is in

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Annual Wage Review decision is in

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The Fair Work Commission’s Expert Panel has handed down this year’s Annual Wage Review decision which will see the federal minimum wage and award rates increase by 3.75% from 1 July 2024.  

The decision notes that impending tax cuts and the increase in the superannuation guarantee charge were moderating factors but also acknowledged that:  “Modern award minimum wages remain, in real terms, lower than they were five years ago, notwithstanding last year’s increase of 5.75 per cent, and employee households reliant on award wages are undergoing financial stress as a result.”

Balancing that, the decision also noted that: we consider that it is not appropriate at this time to increase award wages by any amount significantly above the inflation rate, principally because labour productivity is no higher than it was four years ago and productivity growth has only recently returned to positive territory”.

More to come?

For some industries – those which predominantly employ women – there will be more to come.

We have already had significant wage increases of up to 28% in aged care and there is currently a review being undertaken in relation to nurses and midwives.

In today’s decision, there is a commitment to doing more in this space as per the following statement:

“Modern awards and classifications applicable to early childhood education and care workers, disability home care workers and other social and community services workers, dental assistants, medical technicians, psychologists, other health professionals and pharmacists will be the subject of Commission-initiated proceedings to examine and address gender undervaluation. These proceedings will commence shortly after the issue of this decision and we intend that they will be completed by the time of next year’s Review, which will then move on to the consideration of other gender undervaluation issues.”

So, if you are an employer in any of those industries, you can expect that there will be further “work value” wage decisions in the year ahead.

What do you need to do?

You need to review all employees’ wages to verify that they remain above award when the minimum and award wage increases take effect on 1 July 2024.

If employees are paid sufficiently above award, the increases can be fully absorbed against over-award payments unless there is an enterprise agreement or employment contract that says otherwise.

If you are paying people on an annualised salary or a flat weekly wage, you need to review that to verify that, when you take into account all of the payments that would apply to an employee under the relevant award and based on the hours that they work, the employee is still better off overall on the salary of wage than they would be under award conditions.

Some awards have specific rules ion annualising wages or default provisions which [provide for a certain margin above award offsetting other award conditions. Check the relevant award for your workers to see if any of these apply. 

Don’t forget that the superannuation guarantee charge is increasing by another 0.5% from 1 July 2024 taking it to 11.5% of ordinary time earnings.

Finally, it always an opportune time to review your employment contracts when these annual wage reviews occur. That is even more true this year with all of the changes to the Fair Work Act and modern awards that have been occurring of late.

We can assist you in all of these areas.

If you would like to learn more about ways that we can do this, please call us on 1300 108 488 or email us at enquiries@ridgelinehr.com.au.

CONTACT US

Ridgeline Human Resources Pty Ltd
ABN : 24 091 644 094

enquiries@ridgelinehr.com.au

6 Ellesmere Ave, Croydon Victoria 3136

1300 108 488

PARTNER LINKS

Smilsafe

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Closing loopholes – casual employment

Closing loopholes – casual employment

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Closing loopholes – casual employment

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The Courts and Government have been jumping from one definition or interpretation of what casual employment is to another and then another over recent years and that is happening again under the Albanese Government’s Fair Work Legislation Amendment (Closing Loopholes) Act 2023.  Is it just the pendulum swinging back as happens on a change of government or is it more than that?  

S15A(1) of the Fair Work Act 2009 currently provides that an employee is a casual employee if the employer offers employment on the basis that “there is no firm advance commitment to continuing and indefinite work according to an agreed pattern of work for the person” and the person accepts the offer on that basis and becomes an employee as a result of that.

So the emphasis is on what is in the contract regardless of how the arrangement really works in practice.

Under the changes being introduced, the concept that a casual employee is one who has no firm advance commitment to continuing and indefinite work remains but the emphasis shifts to the practical reality of the relationship rather than just what is written in the contract.

The question of whether there is a firm advance commitment to continuing and indefinite work will be determined by a number of questions:

  • whether the employer can choose to offer (or not offer) work to the employee and wether the employee can choose to accept or reject an offer of work
  • whether continuing work is reasonably likely to be available given the nature of the business
  • whether part-time or full-time employees are undertaking similar roles in the workplace
  • whether the employee has a regular pattern of work..We know that the vast majority of business owners try to do the right thing and want to be compliant with their obligations. 

Casual conversion

The ability for casual employees who serve a minimum period of engagement with a regular and systematic pattern of hours of work has been a feature of awards for decades and has been legislated for a few years now. So it isn’t a new concept.

Under the new rules, a casual employee of a small business employer (ie one with less than 15 employee) will be able to apply for conversion to full-time or part-time employment after 12 months service if they believe that they no longer fit the definition of a casual employee. For employees of larger employees, that opportunity comes after 6 months’ service.

The employer will have to respond to any such request within 21 days and, if the employer refuses the request, the employee can make application to the Fair Work Commission for mediation, conciliation or arbitration of the matter as a dispute.

The employer will have to comply with whatever agreement is reached or decision is made in those proceedings.

Employees are under no obligation to convert – they have the option of remaining a casual employee if that is their preference.

There are transitional arrangements whereby the current rules on casual conversion will continue after 26 August 2024 in respect of existing casual employees for a period of 6 months in the case of employers with 15 or more employees or 12 months for employers with less than 15 employees.

Casual Employment Information Statement

All casual employees must be provided with the revised Casual Employment Information Statement on or before commencement or as soon as possible thereafter.

Additionally, under the new rules, they will also have to be provided with it again:

  •  in the case of a small business, after 12 months of employment
  •  in the case of a large business, after 6 months, 12 months and annually thereafter

When is this all happening?

These changes take effect from 26 August 2024.

What do you need to do?

If you employ casual employees, review your current working arrangements eg how long they have been working with you, what their patterns of hours of work are and whether there is a commitment to ongoing employment on a regular basis (whether or not that commitment is in writing).

Secondly, review your employment contracts or letters of offer to ensure that they are consistent with the new definition and rules on casual employment.

Thirdly, ensure that you obtain the new Casual Employment Information Statement when it becomes available and read it to ensure that you understand it.

Fourthly, get prepared to have conversations with your casual employees about their status against the revised definition and rules and to deal with any likely request for conversion.

We can assist you in all of these areas.

If you would like to learn more about ways that we can do this, please call us on 1300 108 488 or email us at enquiries@ridgelinehr.com.au.

CONTACT US

Ridgeline Human Resources Pty Ltd
ABN : 24 091 644 094

enquiries@ridgelinehr.com.au

6 Ellesmere Ave, Croydon Victoria 3136

1300 108 488

PARTNER LINKS

Smilsafe

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Annual shutdowns – more unintended consequences?

Annual shutdowns – more unintended consequences?

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Annual shutdowns – more unintended consequences?

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One of the things that consistently pops up after a decision to change or qualify the rules on conditions of employment is that wonderful phrase “unintended consequences” all too frequently because the decision makers have been focused on a specific issue without considering the broader agenda eg does making this rule for some create problems for others or create inconsistencies between different categories of workers?   

Last year, a majority decision of the Fair Work Commission decided to change the rules on annual shutdowns for organisations covered by modern awards which had annual shutdown provisions in them.

As things stood to that point, the pre-exisiting award provisions had a requirement that employers give employees a minimum period of notice of a shutdown (up to 2 months depending on the Award). It was accepted practice that employees took annual leave during the shutdown and, if an employee did not have sufficient annual leave to cover the closedown period, they went onto leave without pay for the period not covered by their annual leave entitlement.

The decision changed all that requiring that:

  • Each employee has to be given specific and individual written direction to take annual leave
  • An employee who doesn’t have sufficient annual leave to cover the shutdown period cannot be assumed or forced to take leave without pay – the employer has to ask them and obtain their agreement to take leave without pay or annual leave in advance of their next year’s accruals
  • If agreement is not reached, the employer has the options of providing work or just paying the employee for the balance of the shutdown period without any deduction from annual leave.

That might seem unfair (and that is what the dissenting member of the FWC panel said) but that is what it is today.

So what complications does that cause otherwise?

To understand that, we have to go back to the Fair Work Act and what it says on the issue.

  • S93(3) of the Act says: “A modern award or enterprise agreement may include terms requiring an employee or allowing for an employee to be required to take annual leave in particular circumstances, but only if the requirement is reasonable”. It makes no mention of what is “reasonable”. This is what applies to award-covered employees.
  • S94(5) of the Act says: “An employer may require an award/agreement free employee to take a period of annual leave but only if the requirement is reasonable. Note: A requirement to take paid annual leave may be reasonable if, for example: (a) the employee has accrued an excessive amount of annual leave; or (b) the employer’s enterprise is being shut down for a period (for example, between Christmas and New Year).”

So there are quite different statutory provisions for award/agreement covered employees v award/agreement free employees.

For the former, there has to be a provision in the relevant award/agreement that allows for the shutdown and the related taking of annual leave. For award/agreement free employees, the direction just has to be reasonable.

How this affects award/agreement provisions?

If the relevant award/agreement does not have a shutdown provision, there is no authority to impose a shutdown under the Fair Work Act.

If the relevant award does have an annual shutdown provision , it is subject to the rules that were imposed last year.

If different awards apply to different categories of employees in a business, different rules can apply for example a construction worker has to be given two months notice, whereas a clerical worker in a construction business has to be given 28 days’ notice of a shutdown.

Conclusion

We now have three different scenarios that can apply depending on the job that someone performs and the industrial instrument (if any) that applies to their employment. Is this another one of those “unintended consequences”?

If you would like to learn more about ways that we can help you in understanding Fair Work and what your obligations asa an employer are, please call us on 1300 108 488 or email us at enquiries@ridgelinehr.com.au.

CONTACT US

Ridgeline Human Resources Pty Ltd
ABN : 24 091 644 094

enquiries@ridgelinehr.com.au

6 Ellesmere Ave, Croydon Victoria 3136

1300 108 488

PARTNER LINKS

Smilsafe

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New webinar series on HR compliance for small businesses

New webinar series on HR compliance for small businesses

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New webinar series on HR compliance for small businesses

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From next month, we will be running free monthly webinars specifically designed to assist small to medium businesses in understanding their legal obligations as employers and to provide them with guidance on how to manage those obligations in practice. We are doing this because we are going through the biggest period of change in employment laws, modern awards and compliance requirements ever and that is further complicating what is already an extremely complex obligation for business owners and employers . There are seven sessions running from May to November.

The first of these webinars (on Tuesday 21 May 2024 from 10.30 to 11.15) is about all of the changes that are happening in the Fair Work Act, modern awards and other legislation….there are around 70 changes over a period of 3 years. See our video with the timeline on all of these changes: https://ridgelinehr.com.au/navigating-the-biggest-era-of-change-in-hr-ever/

Unfortunately, there is a lot of noise out there about changes that have little if any impact and lack of clarity about the ones that do. We’ll cut through the noise and tell you what matters and what you should do about it. Book in for free at https://www.trybooking.com/CQQHD or via the QR code in the image.

The subsequent webinars are:

  • Episode #2: Tuesday 18 June 2024: Understanding the Fair Work system and the players
  • Episode #3: Tuesday 16 July 2024: What do these new positive duties mean for SMBs?
  • Episode #4: Tuesday 20 August 2024: What are National Employment Standards? 
  • Episode #5: Tuesday 17 September 2024: What are modern awards and how do they work?
  • Episode #6: Tuesday 15 October 2024: What are psychosocial hazards and how to deal with them?
  • Episode #7: Tuesday 19 November 2024: Preventing sexual harassment and gender-based behaviours

If you have any questions that you need answered urgently, please contact us on 1300 108 488 or at enquiries@ridgelinehr.com.au.

CONTACT US

Ridgeline Human Resources Pty Ltd
ABN : 24 091 644 094

enquiries@ridgelinehr.com.au

6 Ellesmere Ave, Croydon Victoria 3136

1300 108 488

PARTNER LINKS

Smilsafe

TELL US WHAT YOU NEED HELP WITH

Pay deductions

Pay deductions

Latest News & Events

Pay deductions

deductions

Employers may find themselves in situations where deducting employees’ pay becomes a necessary measure. However, it’s crucial for employers to understand the legal and ethical considerations surrounding pay deductions to maintain a healthy employer-employee relationship. In this blog, we’ll explore the reasons behind pay deductions, the legal framework in Australia, and best practices for implementing deductions responsibly.

Types of deductions

The Fair Work Act 2009 is the primary legislation outlining the rights and responsibilities of both employers and employees. When it comes to pay deductions, it’s important to adhere to the following key principles:

Authorized Deductions: Employers can only deduct amounts from an employee’s pay if it’s authorized by law, an industrial instrument (such as an award or enterprise agreement), or with the employee’s written consent. Common authorized deductions include tax withholdings, voluntary superannuation contributions, and salary sacrifice arrangements.

Unlawful Deductions: Employers must be cautious about making unlawful deductions, such as deducting money for faulty work, cash shortages, or damage to company property. Employers also cannot ask for a deduction that would benefit the employer such as charging more when an employer buys a good or service from the employer. Even with an employees agreement in writing these deductions can be unlawful

Notification and Record-Keeping: Employers are required to provide clear and detailed payslips to employees, outlining all deductions made. Where an employer and employee agree to deduct an employees pay the records must include details regarding the amount of the deduction, the reason for the deduction, whether it is a one off or ongoing, and where the deducted money goes. It’s essential to maintain accurate records of these transactions for compliance and transparency.

Common Reasons for Pay Deductions:

Tax Withholdings: Employers are obligated to withhold income tax from employees’ wages and remit it to the Australian Taxation Office (ATO). This deduction is standard and lawful.

Voluntary Superannuation Contributions: Employers must contribute a percentage of an employee’s earnings to their superannuation fund. Employees can also choose to voluntarily contribute to their superannuation fund. Both are acceptable deductions.

Salary Sacrifice Arrangements: Salary sacrifice arrangements can be made for items such as additional superannuation contributions, laptops, cars, or other work-related benefits. Any salary sacrifices must be agreed in writing between both parties.

Recovery of Overpayments: If an employer accidentally overpays an employee, they can deduct the overpaid amount from future wages, provided the employee is notified and agrees in writing.

Common unlawful deductions

Cash Shortages: Deducting money from an employee’s pay to cover cash shortages is generally considered an unauthorized deduction unless the employee has given explicit written consent. The Hospitality Award is an exception to this however, though that is only in the case of an employee deliberately and wilfully causing the shortage.

Deducting pay when notice of termination is not given: It is commonly thought that employees who fail to give notice when terminating their employment or fail to work the required period by the notice forfeit their entitlements to payment for the notice period. This is not true, under most Modern Awards the most that can be deducted from an employees pay when failing to provide notice or work the required period is 1 weeks’ worth of wages and that is only if the employee is 18 or older.

Other Examples include accidental damage to company property, uniform costs and costs associated with training an employee.

Best Practices for Responsible Pay Deductions:

Communication is Key: Employers should maintain open lines of communication with employees regarding any proposed pay deductions. Clearly explain the reasons behind the deduction, ensuring employees understand the purpose and legality.

Written Consent: Whenever possible, obtain written consent from employees before making deductions. This not only ensures compliance with the law but also serves as documentation in case disputes arise.

Timely and Accurate Records: Keep meticulous records of all pay transactions, including deductions, and provide employees with accurate and detailed payslips. This contributes to transparency and compliance.

While deducting employees’ pay in Australia is a legitimate and sometimes necessary practice, it must be carried out in strict adherence to the legal framework. Employers should prioritize transparent communication, obtain written consent where required, and maintain accurate records to foster a positive and compliant work environment. Finding the right balance between financial responsibility and employee satisfaction is key to navigating the complexities of pay deductions in Australia.

Need help?

Give us a call on 1300 108 488 or email enquiries@ridgelinehr.com.au to arrange your free first consultation to see how we can help with advice and support on this or any other HR matter

CONTACT US

Ridgeline Human Resources Pty Ltd
ABN : 24 091 644 094

enquiries@ridgelinehr.com.au

6 Ellesmere Ave, Croydon Victoria 3136

1300 108 488

PARTNER LINKS

Smilsafe

TELL US WHAT YOU NEED HELP WITH