Enterprise Agreements / Agreement Making

The agreements covering employees in any organisation are an important source of duties, obligations and entitlements for both employees and employer. Organisations who fail to have adequate agreements, that is to the terms of the agreement such as rates of pay and leave and termination entitlements, face significant legal risk and negative culture in the workplace. Therefore, it is essential that employers undertake an appropriate and strategic bargaining process to ensure an agreement is reached that mutually benefits employer and employee. PCS offers specialised and comprehensive services to ensure all agreements are risk-minimised and legally compliant.

Business Protection Issues (e.g. Departure of Key Employee to Competitor)

The termination of an employee’s employment can have a real impact on the current and future interests of a business. It is important that organisations have the structures in place to be able to protect their business and if termination does occur that they are able to react appropriately in a timely manner. PCS can provide your organisation with the proactive and reactive options available to help you protect your business brand and interests including drafting appropriate restraint clauses.

Transfer of Business

The transfer of business involves legal and cultural challenges including redundancies, liability for the transfer of employment entitlements, and how to merge long serving employee positions. With your divestments and acquisitions it is therefore important to know what roles exist within an organisation, those terms and conditions of employment, and what parts of the business are performing in line with your expectations. As well as covering off the mandatory legal considerations, PCS can provide strategic guidance for your organisation to manage these cultural issues that arise in the transfer of business.

Employees vs Independent Contractors

Organisations who fail to review contracts and arrangements, and fail to ensure that they have clear and concise terms in place, face significant legal risks should an issue arise as to whether the contract is one of service (employee) or a contract for service (independent contractor). As such, it is important that organisations take time to ensure that the terms of the contract are well-defined as to the obligations and duties of the work arrangement. PCS offers a comprehensive suite of services in this space that will allow your organisation to effectively minimise risks and be legally compliant.

Secondments

Organisations who second employees need to be mindful of the challenges that can arise during the course of a secondment including migration and visa issues, cost of relocation and employment contract concerns. PCS has the knowledge and skills to assist you to ensure that you have met all of your requirements during the secondment process so that an employee can commence work in a timely manner.

Compliance & Audit Services

Overview

The consequences for organisations failing to comply with their legal obligations under the Fair Work Act, awards or enterprise agreements can be significant and in some instances can involve individuals being personally prosecuted. With a very active Fair Work Ombudsman, PCS regularly assists organisations through conducting audits that will result in organisations understanding where they may be non-compliant and then working with you to remedy these areas.

Case Study

PCS recently acted for an overseas corporation that was looking to acquire an Australian business. The overseas corporation was aware that there had been allegations made against the Australian business of non-compliance with obligations under the relevant award. As part of the due diligence process, PCS conducted a detailed “award compliance analysis” exercise whereby based on position descriptions and remuneration data PCS was able to advise the overseas corporation of whether relevant employees were being paid correctly under the award that should have applied to their employment. The calculation of potential underpayment was factored in to the commercial aspects of the transaction. After the transaction was completed, steps were taken to issue new employment contracts to all staff.

How do you rate? Dealing with online employee feedback platforms

Daniel McNamara, Graduate Associate

Some employers are grappling with a new phenomenon – the rise of online employee feedback platforms – where individuals can post anonymous ratings and comments about their workplace experiences, along similar lines to rating restaurants, hotels and service providers. Recently, the United Voice union organisation (under the pseudonym “Hospo Voice”), launched a website titled “Rate My Boss”. The website’s stated aim is to “turn the tables” on employment practices in the hospitality industry by enabling individuals to post anonymous ratings and comments on workplaces across Australia.

While it goes without saying that employers should ensure that the terms and conditions on which their employees are engaged comply with legislative standards, and that transparency around employment practices can be beneficial in circumstances involving potential exploitation of vulnerable workers, there are a number of implications that arise from such ratings systems.

A balancing act: implications for employees and employers

One difficulty arising from sites such as “Rate My Boss” is that the accuracy of posts is impossible to determine. Given the anonymity of the published reviews, this content may come from a disgruntled employee, but it could also emanate from a competitor or any other party, with little to no means of verifying their identity. To post an anonymous review about an organisation on “Rate My Boss”, all that is required is an email address or social media profile to create an account. A service such as this may disproportionately harm employers and businesses due to its lack of accountability and fact-checking mechanisms.

It is unlikely that an employer would want to engage publicly through the same median to respond to such comments, for example as a restaurant might do in response to an unfavourable review. However, an employer may want to respond internally to manage how this is perceived within the workplace, and to ensure that its grievance processes are accessible and working effectively so that the risk of externalising complaints is minimised.

An employee who posts unfavourable comments on an online platform such as “Rate My Boss” may be in breach of their employment contract as a duty of loyalty to the employer is implied as a matter of law in all employment contracts. In addition, workplace policies often regulate a range of employee behaviour that can have an impact on the business. Breaching such policies may result in an employee being subject to disciplinary action, and in some circumstances termination of employment may be warranted.

Posts made on “Rate My Boss” may also give rise to defamatory imputations that an employer can seek to pursue. To satisfy the defamation threshold, typically the content must be published, defamatory (i.e. not substantially true), and clearly identifies the employer/any other relevant party. However, corporations are generally excluded from pursuing defamation proceedings. This may prove to be problematic if a statement on “Rate My Boss” targets an organisation and not a “boss”. While alternative avenues may exist for corporations (such as a claim for injurious falsehood), this can be difficult to establish, and giving such claims a further airing through litigation may not be the most appropriate strategy.

Key takeaways

  • With increasing scrutiny of employment practices, employers should ensure that their practices comply with all applicable legislation and industrial instruments.
  • Online employee feedback platforms might serve a useful purpose for exposing exploitation for vulnerable employees, but are not appropriate for more standard working practices.
  • Being cognisant of the culture of a workplace and having clear and accessible grievance procedures can minimise the risk of such postings occurring.

 

Contract & HR Policy Review

The contract of employment remains the cornerstone of the relationship between employer and employee. Organisations who fail to review and update their contracts of employment and fail to ensure that they adhere to good contract administration face significant legal risk and also send a negative message to their workforce. Similarly, while organisations often embrace a tick-a-box approach to policies and procedures, there is a need for all organisations to spend an appropriate level of time and energy in ensuring their policies work for the organisation. PCS offers a comprehensive suite of services in this space that will allow your organisation to be an employer of choice, legally compliant and strategically geared for success in its relationships with its people.

Sealing the deal: When is a settlement reached?

Ellen Davis, Associate

A recent decision of the Full Bench of the Fair Work Commission demonstrates that while the parties may be confident a deal has been struck, the communications between the parties will be essential in determining, objectively, whether an intention existed to make a concluded and binding settlement.

Background

The Applicant, a 77-year-old with 34 years of unblemished service with the Respondent was dismissed based on his failure to follow safety policies, procedures and guidelines while working in a safety critical location, causing significant risk of harm to himself, his team and members of the public. The Applicant disputed the dismissal.

Prior to the matter being heard, the Applicant and Respondent’s representatives engaged in settlement negotiations and it was said that an agreement to settle was reached in principle. The hearing was vacated, with leave to apply for it to be restored should the parties not be able to agree upon the deed. The Applicant disputed that a binding settlement had been reached between the parties and submitted that the Respondent had made a counter offer which he did not accept.

Offer to Settle

The Applicant proposed to settle on the following terms:

  1. the Applicant would be re-employed;
  2. upon re-employment, the Applicant would perform administrative tasks only;
  3. unless required by the Respondent, the Applicant would not perform any work which would attract overtime and/or penalty rates; and
  4. the Applicant was not to receive any back pay or benefits for the period between termination of employment and re-employment.

The Respondent accepted the offer, subject to further qualifications provided in a draft deed for the Applicant’s review. The qualifications specified:

  1. re-employment was subject to the passing of a medical assessment (the “First Qualification”);
  2. the Applicant was excluded from working at any safety critical environments (the “Second Qualification”); and
  3. the settlement would be subject to confidentiality (the “Third Qualification”).

The Applicant was of the view that the qualifications did not constitute an acceptance and he sought to relist the matter for a hearing.

The Decision

In resolving whether the matter was settled and the Applicant was precluded from having the matter heard, the Full Bench made the following comments about when an agreement is reached. Acceptance:

  1. corresponds to an offer if it is an unequivocal acceptance of the terms offered;
  2. is not an unequivocal acceptance of the terms offered if it deviates from the offer, even if that deviation is not material or important. However, as a qualification to this principle, if a new term is included in a purported acceptance of an offer and the new term is solely for the benefit of the offeror, then this can constitute a valid acceptance;
  3. will be effective if it does not depart from the terms of the offer, but simply repeats in the offeree’s own words the effect of the offer; and
  4. will be effective if it sets out expressly what would be implied by law in the absence of express agreement. For example, an offer may contemplate that, were it to be accepted, a document would be prepared to record its terms.

Similarly, if a purported acceptance of an offer merely includes the “machinery of working out what was meant by the offer” it does not revoke the offer and may constitute acceptance of the offer.

Ultimately, the question was whether a “reasonable recipient of the acceptance would have regarded it as corresponding to the offer or whether they would have taken the acceptance to be…such that it would amount to a counter offer, or at any rate not an unconditional acceptance of what was originally offered”1 .

The Full Bench considered the Respondent’s three qualifications to the Applicant’s offer. The First Qualification was held as a term capable of being implied. The Second Qualification was held not to be solely for the benefit of the Applicant and deviated from the offer proposed by the Applicant. The Third Qualification deviated from the Applicant’s original offer of settlement.

In addition, the Full Bench held that confidentiality was primarily for the benefit of the Respondent and that there was reason to believe that the Applicant would have wanted to disclose to his colleagues upon his return to work, his dismissal and re-employment. In these circumstances, it could not be said that confidentiality of the settlement was a term that “went without saying”.

As the second and third qualifications proposed new terms that where not for the benefit of the Applicant, the Full Bench held that the Respondent’s purported acceptance of the offer was not effective and there was no binding agreement to settle.

Key takeaways

  • A binding agreement will not be reached unless acceptance is unequivocal, leaving no terms left to be negotiated.
  • A variation to negotiated terms or proposal of an additional term can constitute acceptance provided the variation or additional term is solely for the benefit of the offeror.
  • The communications between the parties are relevant when determining their intention to enter into an in-principle agreement to settle.

Flexibility, compliance and culture: Ideas for 2018

Sam Cahill, Associate

For many employers, the summer break offers an opportunity to recalibrate and plan for the year ahead. In this article, we look ahead to the new year, and suggest some initiatives employers might consider implementing to enhance employee satisfaction, address cultural issues and ensure compliance with workplace laws.

Flexibility

In today’s workforce, the opportunity to work flexibly is coveted by many employees. But when employers think of flexible working arrangements, they usually limit themselves to the right to make a request for flexible working arrangements under the National Employment Standards (“NES”). This right is limited to employees who meet the eligibility requirements (for example, 12 months’ continuous service, returning from parental leave, carer’s responsibilities or over 55 years of age).

In 2018, employers should consider taking a proactive approach to flexible working arrangements, rather than simply waiting for eligible employees to make a request under the NES. A more open approach to flexible working arrangements can be used to attract talented people to the organisation and enhance satisfaction and retention among existing staff.

A proactive approach necessitates a focus on identifying particular functions, positions or duties that can be performed on a flexible basis (for example, at different locations and times). A good starting point for this exercise is to review the flexible working arrangements that have been provided to employees in the past and where the functions, positions or duties that have been the basis for flexible work arrangements can be expanded or modified in light of current operating needs.

Compliance

In recent years, the Fair Work Ombudsman (“FWO”) has pursued employers in relation to a range of compliance issues, particularly the underpayment of wages and entitlements.

In September this year, the Fair Work Act 2009 (Cth) was amended to include a number of new measures aimed at protecting “vulnerable workers”.1 These measures include:

  • stronger powers for the FWO to collect evidence in investigations;
  • new penalties for providing false or misleading information to the FWO, or hindering or obstructing an FWO investigation;
  • increased penalties for “serious contraventions” of workplace laws (ie, deliberate contraventions);
  • increased penalties for breaches of record-keeping and pay slip obligations; and
  • a reverse onus of proof in underpayment claims where an employer has not met record keeping or pay slip obligations and cannot show a reasonable excuse.

This means that it is more important than ever for employers to take a proactive approach to ensuring compliance with workplace laws. An important first step towards ensuring compliance is to conduct a thorough review of the organisation’s employment arrangements, including:

  • the engagement of employees and other workers (including the procurement of any external labour services);
  • the coverage and application of industrial instruments (Modern Awards and Enterprise Agreements);
  • compliance with award/agreement requirements with respect to rostering, minimum rates of pay, loadings, penalties and allowances;
  • the accrual and payment of leave entitlements, including the recognition of prior service where appropriate;
  • compliance with obligations in relation to pay slips and record keeping; and
  • the impact of any changes to Modern Awards made by the Fair Work Commission as part of its Four Yearly Review of Modern Awards (for example, the introduction of new provisions regarding annual leave and casual conversion).

The purpose of such a review is to uncover any existing or potential compliance issues so they can be resolved internally and with minimum disputation and/or external scrutiny. The review may also highlight areas in which the organisation will need to develop systems and processes to ensure compliance going forward.

An employer’s compliance obligations under the various workplace laws are subject to almost constant change. This means that employers are required to continually review and adjust their systems and processes. For example, in July this year, as part of the Four Yearly Review of Modern Awards, the Fair Work Commission decided to incorporate a model “casual conversion” clause into 85 Modern Awards. The model clause provides that:

  • the employer must inform casual employees of their right to request a conversion within the first 12 months of employment;
  • casual employees who have worked a standard pattern of hours over the 12-month period will be eligible to make a request to convert to full-time or part-time employment; and
  • a request to convert can only be refused on reasonable business grounds (for example, where the conversion would require a significant adjustment to the casual employee’s hours of work or where it is known or reasonably foreseeable that the employee’s position will cease).

For some employers, the idea of casual conversion is nothing new, as it has existed in certain industries for some time. However, for others, it will be necessary to develop the appropriate systems and processes for:

  • monitoring the engagement and pattern of work of casual employees;
  • notifying relevant employees of their right to request a conversion to permanent employment; and
  • considering and making decisions in relation to requests for permanent employment.

The performance of these systems and processes will then need to be measured as part of the next review of the organisation’s employment arrangements.

Culture

In recent months, a number of allegations, mainly relating to sexual harassment and other inappropriate behaviour, have surfaced in relation to a growing list of high-profile men, including Hollywood celebrities, politicians and business leaders. In some cases, the alleged conduct was repeated over many years and was even well-known within certain organisations and industries. This has raised the question: why has it taken so long for the allegations to surface?

As discussed in the earlier article, “Power, sex and silence in the workplace”, this delay has been attributed to a number of factors, including a reluctance to report misconduct due to fear of victimisation, leading to a “culture of silence” within particular organisations. Some have argued that this culture of silence amounts to a “culture of complicity” in the action of the perpetrator. This topic will be one of the topics addressed in our series of PCS webinars next year.

Employers can take a number of steps to try and overcome a “culture of silence”. These include:

  • encouraging a culture of appropriate conduct modelled by senior staff within the organisation;
  • ensuring that anyone who reports conduct is treated with respect and their experience is not minimised;
  • ensuring the policies are drafted so that employees are specifically required to report any inappropriate conduct;
  • introducing stronger protections against victimisation for workers who report conduct; and
  • ensuring that workers receive training in relation to bullying, harassment and discrimination and what to do if they experience or witness this type of behaviour in the workplace.

  1. Fair Work Amendment (Protecting Vulnerable Workers) Act 2017.