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?
In last week’s client alert we discussed the importance of forming strong employment relations from the outset and the need to have carefully drafted employment contracts in place that appropriately reflect the parties understanding of the bargain. What protections, however, does the law provide when a prospective employer is less than frank about the affairs of the business in which the employee is going to be employed, and makes misrepresentations about the level of earnings, profitability and potential career trajectory of a prospective employee.
Many people believe that if they do not have a written employment contract, they are not bound by a contract with their employer at all. This is a common mistake, as an employment contract exists whether written or not, the moment the employer and employee agree on terms of employment. The contract terms can be either express, that is written or verbally agreed, or implied by law, or a combination of both.
It is common for employers to have written contracts of employment setting out the express contractual terms of the employment relationship, and the duties owed by the employee when performing work.
It is astounding that so often we have discussions with both corporate and individual clients, and when we enquire what Modern Awards apply in their business or cover their employment, they either answer that they don’t have any as all employees are paid above award rates, or they just do not know. Modern Awards cover a vast number of employees across almost all areas of work. It is most unlikely that all an employers’ employees are award free, unless they have an enterprise agreement or other industrial agreement in place that overrides and displaces the operation of a Modern Award.
When providing advice to employers regarding the disciplinary or performance management decisions they wish to make, we are often greeted with incredulity when we inform employers they need to be very careful how they conduct themselves, or they may fall foul of the law. This is especially true when employers have taken disciplinary or other adverse action against employees in circumstances where the employees do not have any unfair dismissal rights. It is not infrequent for us to have the comment: “But they cannot bring an unfair dismissal claim, so can’t I just terminate and give them notice?” Although, the answer to the question may be that as long as the terms of the contract are met, termination or other disciplinary conduct can proceed, this is not always the case, and failure to take into account the General Protection Provisions of the Fair Work Act 2009 (Cth) (“Act”), can mean significant adverse financial consequences.
Going viral on the web can be great for bloggers, Instagrammers, Tweeters and Facebook users, but what happens when an employee posts a “status”, “hashtag” or uploads content that is potentially offensive, intimidating or injurious to the reputation of their employer.
It is perhaps not surprising that, at one point or another, a need will arise at the workplace for an investigation – formal or informal – regarding a complaint or grievance about a work related matter. A workplace investigation is not only a best practice procedure available to an employer when needing to get to the heart of a workplace issue, be it about performance, absenteeism, culture, conduct, safety or otherwise. In some instances, investigations may sometimes also be legally required.
In March 2015, two former directors of ABN AMRO Australia Holdings Limited (“AAAH”) successfully argued that severance and other beneficial bonus entitlements owed to them under AAAH policies, which had not been paid to them on termination, ought to have been paid by their former employer.