With all the changes the Fair Work Act has made to dismissal legislation, you’d certainly be forgiven for being a little wary about dismissing an employee these days.

Because the fact of the matter is, even if you think a dismissal is cut and dried, there’s a good chance it’s not…

Just take this recent case as an example:

A tow-truck driver was dismissed after telling his employer he no longer wanted to be a part of an out-of-hours roster system he had agreed to for years.

The employee was awarded $22,408 in compensation. (Glenn Westblade v Harvey & Dunn Pty Ltd T/A Albury Auto Body Repairs [2010] FWA4961 (21 July 2010).

So what can you learn from this case?

In short, you need to make sure you have covered all your bases before you dismiss an employee.

For example, before dismissing an employee, you should always ask yourself the following three questions:

1. Do you have a valid reason for dismissal? Make sure you have a sound reason for the dismissal that you can prove.
2. Have you demonstrated procedural fairness in your decision to dismiss? This is where the employer in the case above went wrong – you must ensure you follow all the proper procedures when dismissing an employee.
3. Is dismissal a proportionate punishment in the circumstances? Ask yourself if the ‘punishment’ of dismissal fits the employee’s ‘crime’.

Need more information on dismissal? Check out the Dismissal and Unfair Dismissal chapters in your Employment Law Practical Handbook.

Not yet a subscriber to the handbook? Click here for more information on how it can help you manage your employees effectively and legally.

Until next time…

Claire Berry
Workplace Bulletin

Late last week, the federal government announced that it has made some important changes to the Small Business Fair Dismissal Code Checklist.

And yes, these changes will affect you.

Why? Because from now on, before you dismiss an employee, you will need to follow the new version of the checklist to make sure you haven’t dismissed them unfairly.

The changes to the checklist include the addition of two new questions, which will prompt you to:

1. Check if a redundancy is genuine (if you are dismissing an employee for reasons of redundancy). It will ask you to make sure you have complied with any applicable redundancy consultation requirements and considered whether the employee could be redeployed within your business or a related business.
2. Check whether you have complied with any employee requests for a support person to be present.

You can access a copy of the updated Small Business Fair Dismissal Code Checklist here.

For more information on the dismissal process, check out the Dismissal and Unfair Dismissal chapters in your Employment Law Practical Handbook.

Not yet a subscriber to the handbook? Click here for more information on how it could help you.

Until next time…

Claire Berry
Workplace Bulletin

And now over to our Editor-in-Chief Charles Power…

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2 ways to make sure employees on annual salaries don’t dispute additional hours
By Charles Power
Editor-in-Chief, Employment Law Practical Handbook

If you have employees on annual salaries, you no doubt expect that salary to cover all hours that they work. The last thing you want is for your employees on annual salaries to try and claim payment for additional hours of work!

Well here are two ways you can ensure this won’t happen to you:

1. Make sure you specify in your employees’ contracts that their salary is paid for all ordinary hours worked as well as any other hours that are required to complete the requirements of their position.
2. If the role will require the employee to work more than 38 a week on a regular basis, make this clear in their employment contract.

Make sure you’re careful though – if an employment contract does not set out an averaging period for ordinary hours of work, it may be difficult for you to request the employee to work additional hours.

Why? Because if you direct an employee to work additional hours, they are well within their rights to refuse on the grounds that it is an unreasonable request.

For more information on reasonable additional hours, check out chapter M3 Minimum Conditions of Employment – Hours of Work in your Employment Law Practical Handbook.

Not a subscriber? Click here for more information.

Regards,

Charles Power
Editor-in-Chief
Employment Law Practical Handbook

Last week, a rather interesting case caught my eye…

It involved Australian fashion chain Cotton On, who admitted to failing to pay 3289 employees for attending training sessions and staff meetings outside of work hours over an 11 month period in 2008.

The company voluntarily paid back $278,000 to the under payed employees and will now report to the Fair Work Ombudsman (FWO) each year for the next three years about the wage rates and entitlements it pays its employees.

Cotton On will also display A3 sized statements apologising for the underpayments in each of its stores for the next 30 days and put all of its HR managers through a workplace relations compliance program.

So why did this particular case catch my eye, I hear you ask?

Because it draws attention to a common misconception held by many employers…

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How to avoid underpaying your employees

Under the Fair Work Act, you are only required to pay an employee overtime if an entitlement arises under a modern award, enterprise agreement or employment contract.

However, many employers forget that even if an employee is not entitled to overtime under the Fair Work Act, they must still be paid for each hour that you request or require them to work.

This includes things like training sessions and staff meetings outside of work.

For more information about reasonable hours of work, check out chapter M3 Minimum Conditions of Employment – Hours of Work in your Employment Law Practical Handbook.

Not yet a subscriber to the handbook? Click here for more information.

Until next time…

Claire Berry
Workplace Bulletin

Dismissal is always a difficult issue…

And one of the trickiest aspects of dismissal is determining exactly when an employee can no longer perform the inherent requirements of their position.

If you get it even slightly wrong, you could expose yourself to an unfair dismissal claim or even breach discrimination laws.

To find out exactly when is it lawful to dismiss an employee because they cannot perform their position, check out Charles’ article below.

Until next time…

Claire Berry
Workplace Bulletin

And now over to our Editor-in-Chief Charles Power…

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How to determine when an employee can no longer perform their position
By Charles Power
Editor-in-Chief, Employment Law Practical Handbook

If you dismiss an employee because of disability, you will breach the discrimination provision of the Fair Work Act.

However, you will not breach this provision if you dismiss the employee because they cannot perform the inherent requirements of their particular position.

In other words, if an employee cannot exercise the skills necessary to perform the essential tasks of their job in their particular position, then they cannot perform the inherent requirements of their particular position.

Now remember, an inherent requirement is not a peripheral requirement. It must be the kind of requirement that, if removed, would make the employee’s position different.

When determining the inherent requirements of a position, you cannot just focus on the requirements of the employee’s job. Why? Because there is a difference between an employee’s job and an employee’s job in a particular position.

For example, the inherent requirements of the job of a pilot are not the same as the inherent requirements of the position of captain of B747-400 aircraft flying on Qantas’ international routes.

So you need to be careful – just because dismissing for incapacity is not discriminatory under the Fair Work Act you cannot necessarily lawfully dismiss.

You also need to consider your liability in these other areas:

• If you dismiss an employee because of disability, you will also breach federal and State anti-discrimination laws. Again, you will have a defence if the employee cannot perform the essential requirements of the role, but in most cases you will also need to prove that it was not reasonable to implement special measures or facilities to enable the employee to perform those requirements.
• If you dismiss an employee who is on workers’ compensation, you may breach federal and State workers’ compensation laws.
• If you dismiss an employee because they are on paid sick leave you will breach the Fair Work Act, unless the employee has not provided a medical certificate or a statutory declaration within a reasonable time period and/or not complied with other requirements for taking sick leave imposed by an applicable enterprise agreement. This prohibition applies even after the employee exhausts their paid sick leave entitlements, until the absence on unpaid sick leave extends for more than 3 months (or total sick leave absences in the last year exceed 3 months). A worker is not receiving paid sick leave when they are absent from work and receiving workers’ compensation.
• If you dismiss an employee in breach of provisions in the employment contract, enterprise agreement or human resources policies regarding incapacitated workers you may be liable for that breach.

If you dismiss an employee because they cannot perform the inherent requirements of their position, and dismissal has not breached any of the laws described above, you should be able to defeat any unfair dismissal claim.

However, there will be exceptional cases. For example, if the employee’s incapacity is only temporary then dismissal might be unfair, particularly in the case of long-serving employee with a good employment record.

For more information on the dismissal process, check out the Dismissal and Unfair Dismissal chapters in your Employment Law Practical Handbook.

Not yet a subscriber to the handbook? Click here for more information.

Regards,

Charles Power
Editor-in-Chief
Employment Law Practical Handbook

On 1 August 2011, brand new equal opportunity legislation for Victoria will come into force.

This new legislation will place increased obligations on employers to be proactive about enforcing equal opportunity law rather than simply complying with it after a complaint has been made.

So what does this mean for you?

If you are a Victorian employer, you will need to start developing strategies now to deal with the new equal opportunity act.

I’ll be sure to give you some pointers on how to go about this in future Bulletins.

You should also keep an eye out for more information about equal opportunity in the workplace in future Employment Law Practical Handbook updates.

Not yet a subscriber to the handbook? Click here to find out more about how it can benefit you and your business.

Until next time…

Claire Berry
Workplace Bulletin

And now over to our Editor-in-Chief Charles Power…

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How to ensure sexual discrimination doesn’t occur in your workplace
By Charles Power
Editor-in-Chief, Employment Law Practical Handbook

Recently, a particular case has reiterated the need for employers to be alert about discriminatory behaviour occurring in their workplace.

In November of last year, the Queensland Anti-Discrimination Tribunal found an employer guilty of discriminating against a homosexual employee on the basis of his sexuality.

According to the employee, the employer referred to him as a “shirt-lifter” on several occasions and frequently asked him about his sexual habits.

The employer argued that the employee freely discussed his sexual preferences and that his remarks weren’t meant to offend, however the employee disputed this and claimed that the employer’s behaviour made him feel uncomfortable.

The tribunal accepted the employee’s claim, and found that the employer’s behaviour was discriminatory and the employee had deliberately been treated differently to others in the workplace because of his homosexuality.

The employer was ordered to pay the employee $2,000 in damages.

So what can you take from a case like this?

Remember that comments made in the workplace, even ones supposedly made in jest, can really offend people and also constitute discrimination.

In order to take steps to prevent this kind of behaviour occurring in your workplace, you can:

• Ensure that your workplace anti-discrimination policy outlines that discriminating against someone based on their sexual orientation is not acceptable.
• Emphasise in policies or company -wide emails or newsletters that homophobic comments or behaviour will not be tolerated in the workplace.

Regards,

Charles Power
Editor-in-Chief
Employment Law Practical Handbook

If you’ve considered making some redundancies lately, but put the idea in the “too hard” basket because you think it’s too difficult to prove a redundancy is genuine, think again.

A recent decision handed down by Fair Work Australia shows that sometimes, the roles and functions performed in a job don’t have to end completely for the job to be considered a genuine redundancy.

In other words, you can arrange for the same functions and duties performed in a redundant role to continue being performed, even if the “job” they were performed in no longer exists.

For more information and an analysis of the case and what you can learn from it, check out Charles’ article below.

Until next time…

Claire Berry
Workplace Bulletin

And now over to our Editor-in-Chief Charles Power…

A job doesn’t have to end for it to be considered genuinely redundant!
By Charles Power
Editor-in-Chief, Employment Law Practical Handbook

If an employee is dismissed in a case of genuine redundancy, they will be barred from making an unfair dismissal claim.

Remember, a redundancy is genuine if the employee’s job is no longer required to be performed by anyone because of changes in the operational requirements of the employer’s enterprise.

Fair Work Australia (FWA) recently considered this issue (Ulan Coal Mines [2010] FWAFB 3488) after a mining company reviewed operations at an underground coal mine and decided to reduce its workforce, outsource certain functions and increase the proportion of employees with trades qualifications.

The company decided that 38 mineworker jobs had to go and selected those employees to be retrenched on the basis of volunteers firstly and then seniority grounds for the balance. Yet at the same time, the company increased the number of trade-qualified mineworker jobs by 11.

FWA decided that the 38 retrenchments were cases of genuine redundancy, despite the fact that the company had increased its trade qualified workforce.

FWA distinguished between the “jobs” of the retrenched mineworkers – which had become redundant – and the functions performed by those mineworkers, which continued.

FWA ruled that the jobs of the mine workers had become redundant, even though the employer still wanted the functions or duties previously performed by the retrenched mineworkers to be performed.

An employer must comply with any obligation in a modern award or enterprise agreement to consult with employees about a redundancy for it to be genuine.

In this case, FWA ruled that the relevant consultation obligations in the enterprise agreement had been followed by the company meeting with employees and their union representatives to explain the redundancy process.

FWA decided that the employer did not need to have a second meeting one-on-one with the employees selected for retrenchment.

This is significant because the consultation provision in the enterprise agreement in this case is very similar to that which appears in many modern awards.

Regards,

Charles Power
Editor-in-Chief
Employment Law Practical Handbook

Sometimes, dismissing an employee for misconduct isn’t as cut and dried as you might imagine.

Even if you’re sure an employee has committed misconduct serious enough to warrant you dismissing them on the spot, it may be harder to prove than you think…

For example, if you dismiss an employee for a combination of reasons that include misconduct, summary dismissal may not be allowed.

Take this scenario as an example:

Let’s say an employee has been having performance issues for around 6 months – but you haven’t yet taken any steps to counsel or warn them about it.

Then, they send around an email with defamatory comments about some senior members of staff. In your mind, you probably think this is a good chance to dismiss the employee for misconduct and be done with them.

But Fair Work Australia may not see it this way

They will take into account ALL the reasons the employee was dismissed, including their performance issues.

And because you didn’t counsel the employee properly about those issues, you could be held liable for unfair dismissal.

But there is a way you can be sure you won’t be exposed to an unfair dismissal claim when dismissing an employee for misconduct.

Check out Charles’ article below to find out what it is…

Until next time…

Claire Berry
Workplace Bulletin

And now over to our Editor-in-Chief Charles Power…

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Why you must tread carefully when dismissing for misconduct
By Charles Power
Editor-in-Chief, Employment Law Practical Handbook

If you dismiss an employee with immediate effect and without making any payment in lieu of notice, you will dismiss them summarily. And generally, summary dismissal is only acceptable if an employee has committed gross or serious misconduct.

So if you dismiss an employee summarily in circumstances where the employee has not committed serious misconduct, you might expose yourself to an unfair dismissal claim.

But you could avoid the risk of an unfair dismissal claim altogether if you choose to pay the employee in lieu of their notice entitlement.

Fair Work Australia (FWA) recently considered such a case, involving a University lecturer dismissed for serious misconduct (RMIT v Asher [2010] FWAFB 12000). The lecturer was dismissed summarily by the university.

In assessing the case, FWA found that the dismissal could be considered fair because:

• a valid reason existed for termination because the reasons relied on by the employer were sound, defensible and well founded; and
• the employer had taken reasonable steps to investigate the allegations of misconduct and had given the employee a fair chance of answering them.

However, FWA also found that the dismissal could be considered unfair because:

• the reasons for termination involved a combination of performance and conduct issues, which fell short of serious misconduct. Therefore, the employer should have counselled and warned the employee before dismissing; and
• termination was not a fair and reasonable form of disciplinary action in the circumstances of the case.

Therefore, on balance, FWA ruled that termination was harsh, unjust and unreasonable.

In this case, if the employer had simply paid the employee his notice entitlement instead of dismissing him summarily, they would have won the case.

For more information on how to deal properly with employee misconduct in your workplace, check out chapter H3 How to Manage Employee Misconduct in your Employment Law Practical Handbook.

Not yet a subscriber to the handbook? Click here for more information.

Regards,

Charles Power
Editor-in-Chief
Employment Law Practical Handbook

So here they are…

You can NEVER discriminate against an employee on the grounds of their:

• Sexual preference (this includes being heterosexual, homosexual, bisexual or transsexual);
• Participation in lawful sexual activity (this includes sex workers);
• HIV, aids, tuberculosis or hepatitis A, B or C status (in the past or present);
• Criminal record (this includes discriminating against someone whose conviction has become spent);
• Personal association (this includes discriminating against someone because of who their friends, relatives, work colleagues or associates are);
• Employment activity (this includes querying someone’s employment rights or entitlements);
• Age;
• Race (this includes their colour, descent, ethnic or national origin or nationality);
• Religious belief or activity (this includes a lack or absence of religious conviction);
• Marital status (this includes being single, married, separated, divorced, widowed or having a de-facto partner);
• Carer status (having the responsibility for the care of an immediate family member, whether that person is a dependent or not, other than in the course of paid employment);
• Parental status (being a parent or not);
• Pregnancy or potential pregnancy (someone who is pregnant or is likely to become pregnant);
• Breastfeeding (this includes breastfeeding a child or expressing milk);
• Physical features (including height, weight, body shape, disfigurement, skin condition, scar or birthmark);
• Impairment/disability (this includes discriminating against someone on the grounds of a physical, intellectual, sensory, neurological or learning disability or an emotional illnesses or condition, either past or current);
• Participation in lawful industrial activity (being or not being a member of a union);
• Political belief or activity (this includes a lack or absence of political conviction);
• Gender and gender identity (someone who identifies with a particular gender by their style of dress, medical intervention or other means, including a change of name); or
• Sex (i.e. their gender).

For more information about discrimination in the workplace, check out the Discrimination chapter in your copy of the Employment Law Practical Handbook.

Not yet a subscriber to the handbook? Click here for more information.

Regards,

Charles Power
Editor-in-Chief
Employment Law Practical Handbook

So if you don’t know what’s in the modern award applying to your business, now is the time to find out!

For example, if you employ a receptionist or an office worker, they are most likely covered by the Clerks – Private Sector Award.

This modern award contains clauses that:

• require you to consult employees when introducing major workplace change;
• follow a certain procedure when resolving employee disputes;
• pay 25% loading for casuals;
• notify employees in writing of their award classification;
• require you to give one days’ paid leave to job search for each week of notice served when an employee is dismissed;
• pay an allowance for private vehicle use;
• reimburse for costs of equipment and special clothing;
• pay overtime and weekend and public holiday penalties; and
• pay annual leave loading.

This is in addition to the NES entitlements all employees have in regards to annual leave, personal/carer’s leave and compassionate leave, community service leave, redundancy pay and public holidays.

For more information about modern awards, please refer to the Modern Awards chapter in your Employment Law Practical Handbook.

Not yet a subscriber to the handbook? Click here for more information.

Regards,

Charles Power
Editor-in-Chief
Employment Law Practical Handbook

The Guthrie case is not a claim of unfair dismissal under the Fair Work Act – it is a claim based on implied terms in an employment contract, which Mr Guthrie claims gives him a “backdoor” right not be unfairly dismissed.

Implied terms (or unwritten terms) are terms that are not expressed in writing in a contract, but are considered by courts to be part of it.

Don’t let them catch you out!

How to tell if your employment contracts contain implied terms

A term can be implied into a contract:

1. By Custom

If you have a custom or practice in your workplace, (for example you have always paid an extra week of redundancy pay to retrenched employees), then this will be an implied term of your employees contracts, even if it is not expressed in writing.

2. By Law

Courts and tribunals consider that there are certain terms that must be contained in an employment contract in order for the employment relationship to operate, regardless of whether they are actually contained in contract or not.

For example, some terms implied by law are:

• your employee’s obligation to be honest with you;
• your employee’s obligation to honestly answer all reasonable questions you ask them;
• your employee’s obligation to comply with your lawful and reasonable directions;
• your employee’s obligation to exercise skill and care when performing their duties;
• your obligation to give an employee reasonable notice of termination of employment (in the absence of an express term about notice or circumstances warranting summary dismissal);
• your obligation to provide a healthy and safe working environment to your employees; and
• your obligation not to unreasonably destroy the relationship of trust and confidence that is needed for the employment of your employee to continue (this is the centre of the litigation in the Guthrie case).

3. By Legislation.

If your contracts include a term that is contrary to what legislation dictates, the legislation can override that term. For example, the Fair Work Act provides that terms in employment contracts that unreasonably require an employee to make a payment to their employer are ineffective.

For more information on implied terms and other, keep an eye out for the brand new Employment Contracts chapter in your next Employment Law Practical Handbook update. It’s due on your desk next week.

Not yet a subscriber to the handbook? Click here for more information.

Regards,

Charles Power
Editor-in-Chief
Employment Law Practical Handbook