Modern award pitfalls can be costly, warns consultant


Modern award pitfalls can be costly, warns consultant

Modern awards are now one year old, but there are still pitfalls that need to be avoided by employers, a workforce management consultant has warned.


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Modern awards are now one year old, but there are still pitfalls that need to be avoided by employers, a workforce management consultant has warned.
Charles Cameron, a director of employment screening solution, WorkPro, and workforce management consultant, said employers still need to keep on top of workplace laws to avoid costly penalties, an expert warns.
He said there are still plenty of legal developments to keep employers and HR professionals on their toes.
‘During 2010, we saw some interesting findings in the courts and tribunals that employers should take note of — in particular, the treatment of casual workers, making honest job offers and getting modern awards right,’ Cameron said.
He said that while casual employees have in the past provided a flexible workforce, the meaning of ‘casual’ is now being more strictly defined.
‘Increasingly, the courts are now prepared to deem casual employees employed on a regular and predictable basis to be non-casual,’ Cameron said.
‘This means they accrue the same entitlements — such as paid leave — as permanent staff. This can even be the case when casual loadings have been paid, so it’s a potential hidden liability for employers.’
Misleading promises
Cameron said there are also pitfalls for employers who make misleading promises to job candidates in order to attract them.
‘We are seeing claims being made by candidates and employees for misrepresentation in relation to job offers and work promises, and the cost of a successful claim is high,’ he said.
‘For example, promising security and promotional opportunity in an interview, which doesn’t subsequently eventuate, can be seen as misleading and in breach of competition law.’
‘Employers need to be prudent in what they offer, as well as reviewing who in the organisation can discuss work opportunities and associated promises.’
While Modern Awards have now become more familiar to Australian bosses, Cameron said they need ongoing attention, particularly when paying salaries in lieu of specific award conditions.
‘Don’t take your eye off the Modern Award ball,’ he warned.
‘Whilst it is easy to think Fair Work implementation is done and dusted, award and employment contract compliance is an ongoing job and the cost of getting it wrong is high.’
‘It’s important to ensure your salaries more than cover your minimum award obligations and that the structure of contracts clearly outlines how award entitlements are being paid.’
‘If you pay a salary rather than hourly wages, make sure this is covered in employee contracts. Make it clear the payment of a salary off-sets any obligations relating to penalty rates, allowances and similar award entitlements.’
OHS reform
Cameron said that a year after Fair Work Australia kicked off, the workplace reform process is still in train — this time for OHS. Following an agreement by the states, a new regime is set to begin in January 2012.
‘It’s already time to start looking at how your organisation will review its Work Safety (OHS) management system,’ he said.
‘With the regulations and codes being prepared and reviewed now, there will only be around six months to prepare for the 1 January deadline. Any preparation you do now will help ensure a smoother, faster transition process.’
WorkPro also recommends reviewing the organisation’s employment screening practices, to protect both the employer and its staff.’
‘Appropriate screening — from visa status to criminal checks — improves risk management for the organisation,’ Cameron said.
‘And once they have joined the organisation, employees should be given the right OHS training to help them identify and protect themselves from workplace hazards.’
Workplace Law ‘New Year Checklist’
Consider the following checklist:
  • Review employment arrangements and entitlements for long-term casuals.
  • Give hiring managers guidelines on what they can ‘promise’ to candidates.
  • Review contracts to ensure they meet Modern Award standards.
  • Get systems ready for start of new OHS laws on 1 January 2012.


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