By Adrienne Unkovich, MD, Workforce Guardian – Australia’s number one online employment relations service
In the last few weeks I have spent some time talking to with a wide range of SMB employers about the need to minimize their business risk in these challenging times.
In these discussions it has become clear that many employers don’t fully understand the potential impact of compliance on business given the impending employment laws including the new unfair dismissal laws. The fines and financial remedies for big business will be the same for small business – however the potential risk to their future viability is very different.
Given this lack of awareness I wanted to briefly recap the essence of the changes so small businesses are prepared.

The Government’s promised changes to unfair dismissal laws could be tabled in the next sitting of parliament, which is in late August. The ramifications for all businesses are considerable, including the risk of expensive and time consuming legal action or a fine, which is why you need to ensure you are well prepared for the future.

What do you need to do?

Start by asking yourself these three critically important questions:

I. Do you have legally compliant employment contracts?

II. Do you have workplace rules and policies describing the behaviour that is expected of your employees?

III. Do you have a disciplinary procedure in place which has been clearly communicated to all your employees?

The current situation

Currently businesses employing 100 or fewer employees are protected from unfair dismissal claims. Also businesses employing more than 100 employees are protected if the employee has not completed the six months qualifying period or the period of probation specified in the employment agreement.

What’s proposed?

While the government has yet to release the final details of any legislative changes what has been proposed so far is as follows:

• The threshold for protection from unfair dismissal claims will drop from 100 to 15 employee businesses, and even then only for the first 12 months of employment. Protection for small business is therefore substantially reduced.
• Businesses employing more than 15 employees will be protected only if the employee has not completed the six months qualifying period, or the period of probation specified in the employment agreement.
• From 2010 a new body called Fair Work Australia will handle unfair dismissal claims, using a less formal, less legalistic process than that followed by the existing Industrial Relations Commission. While the new system should reduce costs for employers defending claims it could also make it easier for employees to bring claims against employers.

Dealing with the new laws

This is a journey not a destination – but you do need to start looking at updating all their documentation now. That includes:
• Employment agreements
• Terms of employment
• Codes of conduct
• Workplace policies
• Probation periods
• Performance reviews
• Disciplinary procedures.

It doesn’t mater whether it’s a legal requirement or not, it’s good business practice to manage people fairly by having well documented processes and procedures in place that with such critical people management issues.

Want to know more?

More information can be obtained from www.workforceguardian.com.au - Australia’s most comprehensive inexpensive online employment relations service that helps employers navigate confusing employment law in order to properly hire, manage and exit employees:

• Fully compliant Employment Contracts and Independent Contractor Agreements – easy and quick to create using an interview style format,
• Step-by-step employment processes and legally compliant document templates such as employee evaluation forms and employee termination forms,
• Central and secure round the clock storage of sensitive employee information,
• Expert employment relations advice when needed,
• Verified by Clayton Utz and available via the web 24/7.


Disclaimer
This article is intended to provide commentary and general information. It should not be relied upon as legal advice. Formal legal advice may be necessary in particular transactions or on matters of interest arising from this article. Workforce Guardian Pty Ltd is not responsible for the results of any actions taken on the basis of information in this article, nor for any error or omission in this article.