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.
Under Part 6-4B of the Fair Work Act 2009 (Cth) (“Act”) the Fair Work Commission (“Commission”) has the power to make a “stop bulling order” when a worker has been bullied at work, unless the alleged bullying conduct amounts to “reasonable management action” carried out in a “reasonable manner”.
Despite being welcomed for providing greater legislative protection to workers against inappropriate workplace behaviour, the anti-bullying jurisdiction which commenced on 1 January 2014 has had much lower rates of utilisation that expected. The Commission has however delivered some key decisions which provide some clarification around its scope to address and remedy workplace bullying.
In the last few weeks we have appeared in numerous unfair dismissal matters. The level of activity in this jurisdiction is not unusual given that in the period between October to December 2015 the Fair Work Commission (“Commission”) received a total of 3636 unfair dismissal applications. Why is this jurisdiction so popular? It may be due to the fact that 49% of all conciliations settle by way of a monetary payment to the employee within the range of $2,000 to $4,000, and 79% for a payment of less than $8,000. As is often the case, such payments are made because an employer wishes to make the problem “go away”, which can be extremely dissatisfying in circumstances where an employee has followed the appropriate termination procedures and best practices.
One of the most frequent questions I get as an employment lawyer is “restraints of trade are not really enforceable are they?” The legal position is that restraints of trade clauses in employment contracts are void, unless reasonable, and operate to protect a legitimate business interest. Historically this was interpreted very narrowly, and most restraint clauses were not enforced by the Courts. However, that is not the case today. My advice to people who now ask me that questions is, be very, very careful if you are subject to a restraint of trade clause and you wish to breach it.
Many of my clients tell me that they just want to terminate the employment of a troublesome employee and they do not want the hassle of a long drawn out process they believe is required to ensure the employee cannot bring an unfair dismissal claim. I often hear the refrain that it is “impossible to terminate employees in Australia”.
Now I do understand the business imperatives that require quick action in circumstances where an employee is consistently underperforming or is just not a suitable employee. The simplest answer to this issues is to ensure that all employees are properly managed from the day they are hired. Actually, it should start before commencement, as choosing the right employee carefully goes a long way in preventing the issue from arising at all. If employers did this properly, I promise I would be out of business.
Adcock v Blackmores Limited & Ors [2016] FCCA 265
Background
This case concerned an application by Mr Adcock, the former Commercial Manager (Asia) of Blackmores Limited (“Blackmores”) a publicly listed company which produces and sells a range of natural healthcare products, who sought compensation in excess of $140,000 on the basis that his employer dismissed him by refusing to recognise that his position was redundant and had repudiated his contract of employment by failing to pay him redundancy entitlements under an enterprise agreement. In addition, Mr Adcock claimed that Blackmores’ HR personnel knowingly or otherwise reckless misled him as to his workplace rights, namely that he was entitled to redundancy pay.