Are your contracts current, compliant and complete?

Are your contracts current, compliant and complete?

Latest News & Events

Are your contracts current, compliant and complete?

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As we go through the biggest era of change in employment laws and modern awards that we have ever seen, it is becoming increasingly important to have written contracts that clearly set out the pay and conditions applying to each individual employee or contractor. Do yours? And are they current, compliant and complete? 

Why do you need written contracts?

When you engage someone to work for you, whether as an employee or a contractor, it brings into play a host of legal obligations covered by the Fair Work Act and a variety of other legislation and, in the case of employees, modern awards and, where applicable, enterprise agreements. 

There are many purposes that contracts serve:

  1.  They educate you about your legal obligations and can be a source of information for decision-making on issues that arise in the relationship with the employee or contractor.
  2. They clearly set out the nature of the relationship between you and the employee (be it full-time, part-time, casual or fixed term) or contractor.
  3. They provide details on any duties or obligations that the employee or contractor is required to satisfy in the relationship with you.
  4. They provide evidence of the employee or contractor acceptance of the pay and conditions as set out in the contract and, assuming the fairness of the contract, can be used in defence of any claim that might be made against you or your business.
  5. There have been around 70 changes in employment law and modern awards and the rules around employment and contracting have undergone an overhaul recently.

The gap between employee and contractor is progressively becoming more blurred so you also want clarity, especially if the individual is not covered by a company (Pty Ltd) structure.

What are the changes that affect contracts? 

Some of the significant changes that need to be considered in contracts are:

  1. New definitions of employee, casual employee and contractor
  2. Prohibition of pay secrecy provisions
  3. A new jurisdiction at the Fair Work Commission for disputes in relation to unfair contract claims
  4. New jursidictions for road transport contractors and gig workers
  5. The “right to disconnect” and associated award provisions
  6. Changes to rules in relation to annual shutdowns
  7. Revised casual conversion provisions
  8. New jurisdictions for dispute resolution at the Fair Work Commission regarding sexual harassment, requests for flexible working arrangements, requests for extension of parental leave and complaints regarding the right to disconnect

These are just a few of the issues that need to be considered in constructing contracts and their relevance may well vary according to the industry, business setting, occupation and seniority of the role in question. 

Other considerations

While under the changes that we are currently seeing, we are moving back to multi-factorial assessment of the true nature of a relationship (eg contractor or employee), the contract is still an important piece of evidence in determining such questions.

Remember that one size does not fit all and don’t just adopt a template that you got from somewhere else or that is the standard on the HR compliance system that you use. It is imperative that the contract is a fit with your business arrangements and with the individual concerned – ie ensure that they reflect the reality.

We have also seen a number of prosecutions of corporations in recent years for underpayment of wages related to employees being put on contracts with fixed salaries which did not provide adequate remuneration for the hours that those employees actually worked.

So, if you do want to put people on salaries or you wish to set off any award entitlements that might apply to an employee, you need to both be very specific in the contract about exactly which award provisions are being set off and compensated for by the remuneration provided for in the contract and you have to make sure that the employee is actually better off than they would be if the award was literally applied to their employment, pay and conditions.

Also a heads up if you have restraint provisions that the ACCC is currently considering whether restraint provisions should be regulated or, in some cases, abolished – so watch this space.

How we can help

We have been helping clients with employment contracts for over 20 years.

We can advise you on award coverage, terms in awards that affect remuneration or impose certain conditions and help you in structuring remuneration and benefits so that your offer is compliant.

We can help you to navigate all of the changes that are coming in so that your contracts are current.

And we can help you to decide the style of contract that you want in each case and what needs to go into them to make them complete for that particular circumstance.

If you would like to explore how we can assist you with employment contracts, call us on 1300 108 488 or email enquiries@ridgelinehr.com.au to arrange your free first consultation.

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

TELL US WHAT YOU NEED HELP WITH

Closing loopholes no.2 – The Fair Work Commission and “Employee-like” workers

Closing loopholes no.2 – The Fair Work Commission and “Employee-like” workers

Latest News & Events

Closing loopholes no.2 – The Fair Work Commission and “Employee-like” workers

example flexible working arrangement

From 26/8/24, the Fair Work Commission (FWC) will have a new jurisdiction which includes the ability to set minimum standards for “employee-like workers” who perform work for a digital platform and will give those workers access to rights and powers that had previously been unavailable to them. This is part of the Federal Labor Government’s plan to address issues relating to the “gig economy”.

Who does it affect?

The first change being made is to define what an “employee-like worker” is as distinct from an employee and an individual contractor. A worker is considered “employee-like” if they meet two or more of the following characteristics:

  • They have low bargaining power
  • They have low authority over performance of work
  • They receive remuneration at or below the rate of employees performing similar work
  • Have any other characteristic prescribed by regulations

What are the changes?

Previously workers in this space had few rights but they will now have access to the following:

  •  Minimum standards –  A set of minimum standards can now be set to apply to these workers following application by a registered organisation representing employee like workers and their businesses, the Minister for Employment and Workplace Relations, or the FWC. There are limits to what can be included in Minimum Standards and the FWC can only include terms relating to penalty rates, minimum engagement and other similar matters if it is appropriate for the work being performed. Likewise they cannot include terms relating to overtime and rostering.
  • Collective bargaining – Employee-like workers will also be able to collectively bargain through a registered organisation representing them. These will be similar to enterprise agreements and will require the negotiating parties to consult and explain the terms of the agreement before they are approved by the FWC.
  • Unfair deactivation – Employee-like workers will now be able to apply to the FWC for assistance if they believe they have been unfairly de-activated from a digital platform. This will be available to employee-like workers who have been on a contract, or series of contracts, for at least 6-months with the digital platform.
  • Workplace delegates rights – Workplace delegates will now have additional protections while performing their duties and will have a right to reasonable communication with members of their employee organisation and anyone eligible to be members regarding any industrial relations concerns and they will also have a right to reasonable access to workplace facilities. There will additionally be a “Digital Labour Platform Deactivation Code” developed by the Minister of The Department of Employment and Workplace Relations to guide both sides on valid deactivations.

These changes are a significant departure from the current norm for businesses operating in this space. To assist businesses and employee-like workers with the transition, the FWC has set up a Regulated Worker User Group to engage businesses and employee-like workers and explain the changes and keep everyone updated on the progress of the implementation of said changes. Click here for more information.

If you need any assistance with this or similar matters, 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

TELL US WHAT YOU NEED HELP WITH

Closing Loopholes no. 2 – Unfair Contractual Terms

Closing Loopholes no. 2 – Unfair Contractual Terms

Latest News & Events

Closing Loopholes no. 2 – Unfair Contractual Terms

example flexible working arrangement

From the 26th of August 2024 independent contractors will now have the ability to apply to the Fair Work Commission (FWC) to resolve disputes between themselves and principals in matters relating to unfair contract terms in service contracts.

The change has been brought in to provide independent contractors (who earn below the contractor high income threshold) with a more inexpensive and informal pathway to resolving these disputes.

What does the FWC consider in these cases?

The FWC will apply tests to the relationship between the contractor and the principal to determine whether or not there are any instances of an unfair contractual relationship. The dispute, however, has to be about a matter that would be considered a workplace relations matter if the contractor was an employee of the principal:

Here are some of the matters that could be considered by the FWC in these cases:

  • The relative bargaining power of the two parties;
  • Whether the contract is significantly imbalanced in favour of one of the parties;
  • Whether specific contract terms are necessary to protect the legitimate business interests of one of the parties;
  • Whether a contract term is harsh, unjust, or unfair on one of the parties;
  • Whether the remuneration for the parties to the service contract is less than other employees or contractors performing similar work;
  • Any other matters the FWC considers relevant.

If the terms of the contract fail to meet the above criteria then the FWC may either set aside the contract term entirely or change the terms of the contract in order for it to be compliant.

What should I do next?

If your business is one that uses contractors it will be important to review the contracts that you have in place to ensure that it doesn’t contain terms that would fail to meet the above terms. Likewise when developing new contracts they should be made with these terms in mind.

Additionally, while we have no practical understanding of how these disputes will be settled by the FWC at this stage it also possible that it could draw additional scrutiny as to whether the relationship is actually that of an employer and employee as opposed to contractor and principal.

For more information you can visit the Fair Work Commission website regarding this matter by clicking this link

If you need any assistance with this or any other related matter please don’t hesitate to contact us on 1300 108 488 or by emailing 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

TELL US WHAT YOU NEED HELP WITH

Annual Wage Review decision is in

Annual Wage Review decision is in

Latest News & Events

Annual Wage Review decision is in

example flexible working arrangement

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

TELL US WHAT YOU NEED HELP WITH

Closing loopholes – casual employment

Closing loopholes – casual employment

Latest News & Events

Closing loopholes – casual employment

example flexible working arrangement

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 whether 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.

Prior to these new provisions taking effect, employers with 15 or more employees have to offer casual conversion to casual employees engaged for 12 months or more and on a regular pattern of hours on an ongoing basis for at least the last 6 months provided that the employee could continue to work that regular pattern of hours without significant changes as a permanent employee.

Under the new rules, it is entirely up to the employee as to whether they request casual conversion. The employer has no obligation to offer it but will have to respond to any such request within 21 days.

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

TELL US WHAT YOU NEED HELP WITH

Award review on “work and care” underway

Award review on “work and care” underway

Latest News & Events

Award review on “work and care” underway

example flexible working arrangement

Yesterday, the Fair Work Commission commenced its new “Work and Care” Review of Modern Awards which, on face value, could bring about the most substantial and biggest range of changes to our modern awards for decades.

When modern awards were created back in 2009, they were essentially a merger and rationalisation of thousands of pre-existing Federal, State and Enterprise-based awards leading to the 121 modern awards that we have today. 

This “Work and Care” Review has its origins in a Senate Inquiry into Work and Care established in 2022 which led to the Minister for Employment and Workplace Relations instructing the President of the Fair Work Commission to initiate the review.

The Fair Work Commission has issued a discussion paper which sets out the terms and process of the review and addresses relevant recommendations made by the Senate Committee and some other matters. It also has a comprehensive set of questions on the variety of matters to be considered in the review. You can access the report here.

The Senate Committee’s recommendations

Here is summary of the relevant recommendations of the Senate Committee as presented in the FWC discussion paper which shows how far reaching changes could be:

  • An enacted right to “disconnect from work” enabling and supporting productive work from home and flexibility of work, protecting workers’ rights to disconnect from their job outside their contracted hours, reinforcing that right with employers and applying a positive duty on employers to reasonably accommodate the right wherever possible;
  • Amending the Fair Work Act to provide improved rostering rights for employees and, in particular, working carers, by requiring employers to implement rostering practices that are predictable, stable and focused on fixed shift scheduling (eg fixed times and days) and increasing employers’ existing obligations to genuinely consider employee views including working carers on the effects of roster changes and  other work arrangements;
  • Conducting a work value case in care sectors including early childhood education, aged and disability care and sectors covered by the SCHADS Award with a range of entitlements specifically mentioned eg payment for work-related travel time, administrative responsibilities and essential training and a minimum shift call-in time;
  • Extending the definition of “immediate family” for carer’s leave purposes to include any person who has been a member of the employee’s household for at least 18 months, an employee’s children including adopted, step and ex-nuptial children, an employee’s siblings or the siblings of an employee’s spouse or de facto partner or any other person significant to the employee to whom the employee provides care;
  • Consideration be given to the adequacy of existing leave arrangements including separate carer’s leave and annual leave;
  • Reviewing access to and compensation for paid sick leave and annual leave for casual and part-time workers;
  • Requiring employers to provide at least two weeks’ notice of roster changes, to genuinely consider employees’ view on the impact of roster changes and to accommodate the needs of employees plus an employee “right to say no” to extra hours with protection from negative consequences;
  • Reviewing the operation of the 38 hour week with consideration of stronger penalties for long hours and other possible ways to reduce them including through the work health and safety system to ensure safe working hours;
  • Introducing an enforceable “right to disconnect from work, restricting employers from communicating with workers outside their contracted hours except for emergency or welfare reasons plus increase penalties for wage theft for unpaid additional hours;
  • Introducing mandatory annual reporting of companies with 20,000 or more employees in Australia on workplace practices to ensure roster justice and flexible working arrangements and related collection of data on requests for flexible working arrangements made and shift roster changes;
  • Developing a new statutory definition of casual employment that is restricted to work that is genuinely intermittent, seasonal or unpredictable and restricting the use of “low base” contracts, ensuring part-time employees have access to regular and predictable patterns and hours of work with consideration of penalty rates for work outside contracted hours;
  • Developing standard definitions of full-time and part-time employment for inclusion in the Fair Work Act 2009;
  • Undertaking a review of standard working hours with a view to reducing the standard working week.

Please remember that these are just recommendations which are to be considered in the review being undertaken by the Fair Work Commission. Some of the items require legislative change and that would be up to the federal government to negotiate through Parliament. So it will be a while before we know exactly what any award or legislative changes that flow from the Senate Inquiry will look like in real terms.

What this all means

The last year and a bit have delivered far more change in workplace relations law and employment rules via legislation, modern award reviews and decisions made by the Fair Work Commission and the Courts than we have seen in years.

This review tells us that we can expect more of the same in the years ahead.

The other element here is the WHS one that is noted in relation to extended working hours but equally links the positive duty to eliminate or control psychosocial hazards, many of which can be connected to some of the recommendations of the Senate Inquiry – eg around remote work, organisational justice, reward and recognition, job demands, etc.

The positive duties are progressively being rolled out across the country via State and Territory legislation.

For this reason, it is important to consider the agenda here in that broader context and the smartest way to do that is to consider whether any of the issues raised here are demonstrative of an issue in your workplace and the need for you to do something about that.

Conversely, have a think about whether you already accommodate some of the items raised here or perhaps you could actually do so. Remember that the Fair Work Act and modern awards provide minimum standards and there is nothing that should stop you from considering what you might be able to offer more than those in any way.

Given the challenges that we have in both accessing the talent we need for our businesses and looking after our own and our employees’ wellbeing, anything we can do over and above those minimum standards helps us on both counts.

You could also consider negotiating an enterprise agreement with your employees delivering on some of those above award benefits and using that as a public validation of your commitment to your people/your Employer Value Proposition. There might also be some changes that you want to make that are not allowed for under the relevant Award and so an enterprise agreement might be useful legally validate and protect desired changes.

We will monitor developments in the review and communicate further as and when developments occur.

If there is anything here that resonates with you and you would like to explore further, give us a call on 1300 108 488 or email enquiries@ridgelinehr.com.au. We would love to have a chat about it.

 

 

 

 

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

TELL US WHAT YOU NEED HELP WITH