The first few months of 2010 provides employers with an
important opportunity that should not be overlooked - to engage in
appropriate risk management and ensure compliance with our new
1 January 2010 brought about the commencement of significant
aspects of the Fair Work Act 2009 ("FW
Act"), being the new National Employment Standards
("NES") and the operation of modern
Failure to comply with minimum employment terms and conditions
can prove extremely costly, particularly if there is an oversight
that continues for a lengthy period. Businesses can face
prosecution proceedings not only for significant amounts of back
pay but also seeking penalties against them (at the maximum fine of
$33,000 per offence). These proceedings can be issued by a union or
by the Fair Work Ombudsman. The last 3 years have seen an
unprecedented increase in the number of these prosecution
proceedings, in all parts of Australia. These prosecutions can be
significant revenue raisers for unions as a court can order that
penalties imposed be paid direct to the union that issued the
Given these developments, any time and money invested now to
ensure compliance with minimum standards is well spent. Ideally,
this should include a general health check that is not simply
confined to FW Act compliance issues.
Employer health check
We recommend a focus on the following matters:
Ascertain which modern awards apply to which employees; ensure
that you are familiar with the significant terms and conditions
contained in them (including any transitional provisions phasing in
relevant pay adjustments).
Audit your employment contracts and policies to ensure
compliance with the NES and modern awards. The NES have brought
about subtle changes to a number of minimum terms and conditions,
which may require amended wording in your contractual
Ensure that you are familiar with the new rights of employees
to request flexible working arrangements and have procedures in
place to ensure that your responses to these requests are legally
Consider whether you have any higher paid employees who you may
wish to approach to opt out of modern award application, in
accordance with the high income employee provisions in the FW Act
(the current indexed remuneration package figure here is
Ensure the manner in which employee leave accrues is now in
accordance with the NES.
Ensure that your record keeping practices satisfy the record
keeping requirements under the FW Act.
Ensure that appropriate policies dealing with discrimination,
harassment and bullying are in place. Policies dealing with
relevant leave terms plus internet and computer usage should also
Determine which of your policies, if any, should form part of
your employment contract and ensure that this is clarified in the
contract wording. Wording should also exist to minimise the risk of
policies that are not intended to form part of the employment
contract being implied into the contract.
If you have a collective agreement in place already that has a
nominal expiry date in the next 18 months, familiarise yourself
with the new laws relating to enterprise bargaining, particularly
good faith bargaining and the new "better off overall
test" for approval.
If you have no collective agreement currently in place:
Consider the advantages and disadvantages of implementing one;
be prepared for the prospect of a union requesting to bargain
with you (on behalf of some or all employees). Employers cannot
refuse to bargain with a union that becomes a bargaining
Ensure that you have some familiarity with the new adverse
action provisions in the FW Act, so that you know when to obtain
legal advice in the future.
Hunt & Hunt can help your business to become compliant by
assisting you in carrying out an employer "Health Check".
We can also assist you with the further information issues
discussed above. Please contact us to have one of our staff attend
your premises for a thorough assessment of your workplace
practices. Alternatively, should you require any further
information regarding the Fair Work Act, please do not hesitate to
For further information please contact: David Thompson, Partner
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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