As an employer, it is important that you have a professionally drafted Employment Contract for your employees. While there are a number of aspects that are automatically covered by the Fair Work Act or a relevant Modern Award, a number of important areas still need to be addressed and covered in a Contract.
What is automatically covered?
Every full-time and permanent part-time employee in Australia, regardless of their salary, job or whether or not there is a written contract in place, is entitled to the following as set out in the National Employment Standards ("NES"):
- Maximum weekly hours;
- Requests for flexible working arrangements;
- Annual leave;
- Personal, carer's and compassionate leave;
- Community service leave;
- Public holidays; and
- Notice of termination and redundancy pay.
State laws also provide for employees to receive long service leave.
These entitlements act as a minimum bench mark and employers and employees cannot agree, whether orally or in writing, to anything that is less than these minimum entitlements.
What about employees covered by an award or enterprise agreement covered employees?
Whether or not your employees who are covered by a Modern Award or Enterprise Agreement employees require written Contracts of Employment will be dependent on your employee, your industry and the contents of any such Modern Award or Enterprise Agreement.
Modern Awards and Enterprise Agreements cover a number of critical areas of the employment relationship, such as wages, leave, penalties and allowances. However, not all such agreements address other critical issues, such as restraints of trade, non-competition and issues regarding trade secrets and confidentiality.
In addition, many employers employ their employees on a salary, inclusive of all of an employee's entitlements under an Award or Enterprise Agreement (such as annual leave loading, overtime and weekend penalty rates). If you want to provide your employees with an all-inclusive salary, you will need to provide for this in a written Contract of Employment.
Depending on your business and the role of your employee, issues can arise if such areas are not addressed in a written contract. In the event of a dispute, each party may have a differing recollection as to what, if anything, was agreed to at the commencement of employment. Having a written contract in place lessens the risk posed by a subsequent dispute or disagreement, as the contract will stand as written proof of the agreement made between you and your employee on such critical issues.
Remember, even if you don't provide an employee with a written agreement at the commencement of their employment, the law still requires employers to provide every new employee with a copy of the Fair Work Information Statement, providing your employees with the required information regarding their rights under the NES.
How can Sharrock Pitman Legal help?
If you are an employer and need advice on Contracts of Employment for your employees, we can assist you. Call Sharrock Pitman Legal today on 1300 205 506 or complete the form below.
The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.
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For further information contact
Mitchell is the Managing Principal of our law practice.
He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate. For further information, contact Mitchell on his direct line (03) 8561 3318.