Australia is home to the world’s most complex employment laws. We’ve got around 130 Modern Awards, 10 confusing National Employment Standards (NES), hundreds of pages of legislation, and complex rules relating to dismissals. It’s obvious why employers are confused, and no wonder why clients often send their HR related questions your way. Indeed, many employers think their HR related questions are actually ‘payroll related’ questions, so they think you’re best placed to answer them. So we’re very pleased to present the following tips to help you spring clean your HR knowledge
1. The NES apply to almost everyone If an employee is covered by the Fair Work Act 2009, then they’re also entitled to the 10 National Employment Standards (NES). These NES are non-negotiable, and include benefits such as leave, employment flexibility, and maximum working hours. Some NES have their own internal ‘eligibility criteria’. For example, casual employees don’t accrue paid annual leave. Importantly, failing to provide the NES to eligible employees can lead to penalties of up to $51,000 per breach, so now’s the time to ensure you’re compliant.
2. Modern awards also apply. Most employees are also covered by one of the nation’s ‘Modern Awards’. These are documents which impose additional terms and conditions of employment on employees working in particular industries or occupations, including minimum pay rates, overtime rates, penalties, and allowances. Modern Awards apply as a matter of law – not choice – and copies of the relevant Modern Award need to be available to employees in the workplace. Again, heavy penalties apply for breaches.
3. Dismissals can be costly Almost all employees (including casuals) become protected from so-called ‘unfair dismissal’ once they have completed the applicable ‘minimum period of service’. For businesses with fewer than 15 employees, this is 12 months. In all other businesses, it’s 6 months. Note that there is no automatic exception for ‘small businesses’, and there hasn’t been for almost 6 years!
4. Small payroll decisions can be disastrous Ever cashed-in an employee’s paid annual leave even though their Modern Award didn’t expressly permit it? Ever withheld money from an employee’s final pay because they didn’t return company property? These common practices are almost always unlawful under the Fair Work Act 2009, and can result in penalties even if no formal complaint is made.
Many small business owners don’t really understand the NES and associated awards. Now really is the time for your firm and your small business clients to review their compliance with Australian employment laws.
David Bates, MD, Workforce Guardian. Ph 1300 659 563
FREE HR HEALTH CHECK FOR KEY ADVISORS
Under section 550 of the Fair Work Act 2009, key business advisors such as accountants and bookkeepers can be held personally liable as an ‘accessory’ for their clients’ breaches of Australian employment law. Workforce Guardian’s FREE Fair Work Liability Check will confirm whether you’re exposed to potential penalties of up to $54,000 for each of your own and your clients’ breaches of Australian employment law. If you answer no/unsure to any of these questions, you should take urgent action to reduce your risk of accessorial and personal liability.