During difficult economic times it is not uncommon for companies to face an array of monetary hardships, and in some cases, be compelled to or voluntarily take steps towards wind up the affairs of the business. Indeed, company directors and business owners have positive obligations under Australian Corporations Law to prevent insolvent trading. Whilst in some situations, the financial woes of an organisation can be saved through various forms of borrowing and other debt arrangements, this is not always the case. Current statistics indicate that approximately 10,000 companies go broke in Australia each year. When a company becomes insolvent and cannot meet its debt obligations, what happens to its employees, and any employee entitlements that are unpaid?
The election has come and gone, and we are all settling down with somewhat reduced Liberal Party presence in power. With the Liberal party staying in office we thought it was appropriate that we provide a brief recap on some of the Coalition’s key election policies in relation to employment and industrial relations. We also provide an update on a number of key employment changes since the election took place.
In last week’s client alert we discussed the significant issue for employers of dealing with a long-term ill or injured employee. As was noted in the article, most employers in our experience generally want to do the right thing when it comes to dealing with employees who are ill or injured and are unable to return to full time pre-injury employment. This however needs to be balanced against the interests of the business, and in some cases it is simply impractical for the employment to continue. In those circumstances, it is however not simply a matter of dismissing the employee on the basis of the injury or illness for which they have been absent from the workplace.
It might surprise some of our readers but one of the most difficult employment issues for any employer to deal with, is a long term ill or injured employee. There is a significant amount of confusion and lack of understanding regarding the rights of both the employee and the employer in these circumstances. Most employers want to do the right thing when it comes to dealing with employees who are ill or injured and are unable to return to full time pre-injury employment, but need to balance the interests of the employee with the needs of the business.
Requests by employees for flexible working arrangements have become more and more popular since the introduction of this right as part of the National Employment Standards. Traditionally, such requests were most common amongst working mothers and employees with carer responsibilities. Nowadays it is common for all types of employees to utilise flexible working arrangements for a variety of different reasons. In our experience, many employers are more than willing to consider and, where they are able to do so, accommodate requests for flexible working arrangements. In some cases, however, the operational demands of the business simply do not permit an employer to agree to such requests.
Do I need to have a probationary period in my contract of employment? What is the difference between a probationary period and the minimum employment period? What does a probationary period actually mean? These are some of the questions we are routinely asked in relation to what is normally a fairly standard contractual term.
In our experience, there is considerable confusion about the difference between a probation period and how this relates to the minimum employment period in the Fair Work Act 2009 (Cth) (“FW Act”).
There is a common misconception amongst employers that the dismissal of a troublesome employee can only occur once the employer has followed the “three strikes and you’re out” rule – in other words, the employer must give the employee three official warnings before they can terminate the employment relationship. There is a broad management philosophy that three warnings prior to termination is best practice, and this may well be true, however, there is no legal requirement to provide a specified number of formal warnings. In this way, the notion of “three strikes” simply does not feature anywhere in Australia’s employment law landscape.
We regularly receive requests for advice from company directors and officers, of both private and publically listed entities. Whilst there are a range of separate disclosure obligations applicable to public companies and a host of duties and obligations placed on directors and other officers of corporate entities, which is far too broad to canvass within the scope of this article, we are often asked to advise on the ability of employees, offices and directors to compete with their former employer. The position is far clearer where there are existing contractual protections in the form of restraints and specific contractual confidentiality obligations. But what is the position, where there are no such contractual restrictions?
As practicing employment lawyers it always surprises us how businesses are bought and sold, without so much as a pause to consider the employees concerned. The first lawyers to be contacted and involved are the corporate lawyers. They are well versed in merges and acquisitions, tax and finance matters and ensuring the financial and contractual obligations of the parties are considered and the fine print of the purchase and sale agreement is carefully drafted. However, no or very little consideration is given to the most important asset of any business, its people.
In recent years, Australia has witnessed a marked increase in the density and willingness of volunteer and unpaid workers to join the workforce. In fact, for many young people at the end of their academic life, undertaking an unpaid internship has become a naturally viable step in scoping the market for work opportunities. For many graduates, an unpaid internship provides practical experience and a launching pad to other possible career paths. For employers, it provides an opportunity to trial an employee’s skills before committing to an offer of employment. But what is the position at law, and what does the Fair Work Act 2009 (Cth) (“FW Act”) and other relevant employment relations legislation have to say about unpaid work arrangements.
For many employers operating in professional services and non-industrial industries, the concept of work health and safety is, let’s face it, not thought of as a particularly significant workplace issue. Occupational awareness and the maintenance of safe work systems and practices is, however, not only applicable to heavy industries and those where workers are working with dangerous machinery and equipment. Unfortunately, some employers learn the hard way that the work health and safety laws in Australia are expansive and can be incredibly powerful in circumstances of noncompliance. As is often the case, a fairly minor safety breach or incident is enough to expose an unsafe workplace, and can result in the employer becoming the subject of a safety audit by the regulator, who under the Work Health and Safety legislation has a number of enforcement options available to it.
What happens when you want to terminate the employment of an employee, or as an employee you wish to resign but your contract of employment is silent on how much notice is required. This may seem like a silly question, and many employers still believe that the notice required on termination relates directly to the frequency of payment. In other words, if an employee gets paid fortnightly they are entitled to give 2 weeks’ notice. This is not the case, notice is usually a matter agreed between the parties on commencement of employment and contained in the written contract of employment, but what happens when there has been no prior agreement and nothing in the contract of employment dealing with this issue. How much notice must be given and what are the consequences for failing to provide sufficient notice?