Employment Law

Under the provisions of s 119 of the Fair Work Act (the FWA), a national system employee will be entitled to redundancy pay if their employment has been terminated under the following circumstances:

·         the redundancy was done at the employer’s initiative because there is no longer a requirement for the job to be done by anyone, except for instances where it is due to the ordinary and customary turnover of labour; or

·         because of the insolvency or bankruptcy of the employer;

·         The amount of redundancy pay that a person is entitled to correlates with the employee’s period of continuous employment, as well as the base rate of pay and their ordinary hours of work as outlined in s 119(2) of the FWA.

If the decision by Fair Work Australia in O’Keefe v William Muir’s Pty Ltd T/A Troy Williams The Good Guys [2011] FWA 5311 is any indication, then yes, an employee may be liable for comments made on a social network site, in the privacy of their own homes, and outside of work hours.

In O’Keefe v William Muir’s Pty Ltd T/A Troy Williams The Good Guys, the main point of contention during the hearing was focused on whether the dismissal was harsh, unjust or unreasonable, in accordance to the legislation.

Finding for the employer, Fair Work Australia in their judgment alluded to the fact that there were still channels in which the applicant was able to use if he had any issues regarding pay, which included the appropriate internal processes. Furthermore, the applicant also had the option of raising any concerns with the Fair Work Ombudsman, but instead, the employee chose to vent his frustrations on a social networking site where his comments were able to be viewed by fellow co-workers, which ultimately resulted in his dismissal.

The eligibility requirements for receiving a pro rata payment of long service leave vary between the States and Territories. However, in most instances there is an entitlement to receive a pro rata payment of long service leave if an employee resigns due to illness.

In addition to illness, employees may also have an entitlement to pro rata long service leave if they resign because of: incapacity; domestic reasons; or any other pressing reasons of necessity; or if their employment is terminated by their employee under certain circumstances.

If you wish to terminate an employee for making derogatory comments on social media you need to be aware of a recent decision in Fair Work Australia where such termination was found to be an unfair dismissal.

In this decision it was found that at the time of the dismissal, and at the time of the hearing, the employer did not have any policy relating to the use of social media by its employees. This was insufficient in the current electronic age.

In addition, it was accepted that the employee believed the comments posted on his Facebook page could only be viewed by himself and those he accepted as his Facebook friends. In essence, his Facebook page was not a web blog and was not intended to be on public display.

To protect your company against a successful unfair dismissal claim you should obtain expert legal advice on what policies need to be in place relating to use of social media by employees and when such comments justify dismissal.

If we look towards case law, the actions that have been initiated by workers due to excessive workloads are generally psychiatric in nature. However, the courts have been reluctant to remedy psychiatric injury arising from work related stress, because what occupation is free from some form of stress? The High Court in Koehler v Cerebos stated:

“An employer may not be liable for psychiatric injury to an employee brought about by the employee's performance of the duties originally stipulated in the contract of employment. In such a case, notions of "overwork", "excessive work", or the like, have meaning only if they appeal to some external standard. (The industry evidence adduced by the appellant was, no doubt, intended to provide the basis for such a comparison and, as noted earlier, the Commissioner drew a comparison of that kind by concluding that the appellant's workload was excessive.) Yet the parties have made a contract of employment that, by hypothesis, departs from that standard. Insistence upon performance of a contract cannot be in breach of a duty of care.”

Although, in Koehler the industry deemed that the amount of work undertaken by the employee was more than the standard and the High Court affirmed the assessment by the industry, the Court however did also add that statute provides a financial remedy for an employee who has worked more than their contractual obligations:

“Within the bounds set by applicable statutory regulation, parties are free to contract as they choose about the work one will do for the other. In particular, within those bounds, parties are free to stipulate that an employee will do more work than may be the industry standard amount. Often the agreement to do that will attract greater rewards than the industry standard. Developing the common law of negligence in a way that inhibited the making of such agreements would be a large step to take.”

It should be noted, that employers are required to take reasonable measures to respond to a foreseeable risk, which of course leads to the question: What about excessive workloads? Well, that issue has not as yet been clarified yet by the courts so until then, the question will remain unanswered.

However, s 524(1) of the Fair Work Act (FWA) does allow a national system employer (a constitutional corporation or the Commonwealth) to stand down a national system employee under the following circumstances:

•             industrial action not organised by an employer;

•             a breakdown of machinery or equipment when an employer cannot be reasonably held responsible for the breakdown;

•             work stoppage in which an employer cannot be reasonably held responsible.

Although, it’s vital to note that an employer cannot stand down an employee during a period of authorised leave.

When determining if the dismissal of an employee was harsh, unjust or unreasonable, the FWA will take into consideration the following elements:

• whether there was a valid reason for the dismissal related to the employee’s capacity or conduct, which includes the effect on the safety and welfare of other employees
• whether the employee was notified of the reason
• whether the employee was given an opportunity to respond to any reason related to their capacity or conduct
• any unreasonable refusal by the employer to allow the employee to have a support person present, to assist in any discussions relating to the dismissal
• if the action of dismissal was related to the unsatisfactory performance by the employee, and whether or not the employee had been warned about their unsatisfactory performance before the dismissal
• the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal
• the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise, would be likely to impact on the procedures followed in effecting the dismissal
• any matters the FWA considers relevant.

The Commonwealth Government has announced that it will introduce changes to equal opportunity legislation in Parliament by the end of 2011. The Equal Opportunity for Women in the Workplace Act 1999 (Cth) will be renamed, as the Workplace Gender Equality Act. The main aim of the new Act is to increase equality within Australian places of employment.

Some of the key features of the proposed new legislation are:

• expansion of gender equity legislation, which applies equally to both men and women in the workplace;
• new reporting requirements on all organisations employing more than 100 employees;
• new investigative powers and compliance provisions via the Women in the Workplace Agency.

Starting from 2013, organisations which employ more than 100 workers will be required to provide reports detailing: the gender composition of their organisations and boards; as well as employment conditions, and flexible work practices within the organisation. These reports will have to be provided to the government, employees and shareholders.

Any employer or organisation who requires assistance in regards to the proposed Act, should seek advice from a legal practitioner.

Employers generally own the copyright to all materials produced by their employees, however, there are exceptions. The Copyright Act 1968 (Cth) provides that employers may own the copyright to works created by an employee if the works were created in the pursuance of the terms of a contract of service.

Where a third party is preparing works, but may not actually be an employee, or is preparing the works in pursuance of their terms of employment, the employer may have to take additional steps to clarify ownership of copyright. In some cases, this may involve the third party assigning any copyright that may exist to the employer, or specifically, varying the employee's terms of employment. Employers should also consider the effect of "moral rights" over works created in the course of employment.

It is important for employers to note that all employment contracts should clearly set out the duties of employment, along with the inclusion of a comprehensive assignment of all intellectual property rights to the organisation. This is essential for the employer to be assured that all rights in the intellectual property in materials created by employees, is ultimately owned by the employer.

Under s 193 of the Fair Work Act, enterprise agreements - which are not Greenfields Agreements - are required to pass the "better off overall test" before they can have efficacy. The enterprise agreement must be approved by Fair Work Australia (FWA), and employers must satisfy FWA that all employees, as well prospective employees, would be better off under the enterprise agreement when compared with the relevant modern award.

However, it's also important to note, that enterprise agreements that do not pass the "better off overall test", can still be approved by FWA under exceptional circumstances, and that the approval of the enterprise agreement is not contrary to the public interest.

Complying with the statutory requirements in relation to producing a valid enterprise agreement can be difficult, which is why most employers seek legal advice before deciding to negotiate an enterprise agreement with their employees.

In most cases, the notice period for terminating a contract of employment is specified within the agreement itself. Additionally, business practice and custom can also give rise to an implied term of notice in regards to the ending of a contract of employment.

The reasonable notice period must be determined by reference to the circumstances at the time that notice is given, rather than the commencement of the contract.

Relevant factors in determining the reasonable notice requirements may include:

• the position held by the employee;
• the importance of the position and nature of the work;
• the salary level;
• length of service;
• the professional standing of the employee;
• the employee's age, qualifications and experience;
• the degree of job mobility;
• the employee's prospects for future employment, including the time it would take the dismissed employee to find alternative employment; and
• the period of time the employee would likely have continued in employment.
  

However, an employer can also dismiss an employee without notice due to issues such as misconduct and inefficiency.

Anyone who is experiencing difficulties with their employment contract should seek legal advice.

Whether employers can discipline or dismiss an employee in relation to out of hours conduct is a complex matter. Action may be taken where there is a clear and relevant connection between the employment and the out of hours conduct. In order for this connection to exist, the conduct must amount to a rejection or contradiction of the employment contract by the employee. This is limited to the following circumstances:

• the conduct, when viewed objectively, is likely to cause serious damage to the relationship between the employer and employee;
• the conduct damages the employer's interests (which can include behaviour that significantly undermines management, creates fear in the workplace or gives rise to negative publicity); or
• the conduct is incompatible with the employee's duties.

Before dismissing an employee, employers must ensure the conduct has a sufficient connection to the employee's employment. In the absence of such a connection, employers do not have the right to control or regulate an employee's out of hours conduct.

Generally speaking, an employee who has worked in excess of 38 hours per week or outside of the "ordinary hours" as defined in an award or agreement, will be seen as having worked overtime.

Employees, who aren't usually required to work on weekends, or have to work outside of their ordinary hours of employment, may be entitled to be paid extra, and in most cases, overtime work attracts higher rates of pay in accordance with the applicable award or agreement. In some instances, overtime payments can be substituted with time off work, which is again, dependent on the applicable award or agreement.

Employers who choose to vary overtime or penalty rates which are set by an award, can only do so by entering into an enterprise agreement with their employees. However, all enterprise agreements must pass the "better off overall test" and be approved by Fair Work Australia. Also, employers cannot contract out overtime arrangements under any circumstances.

Any employee who feels that they are not receiving their legal entitlements should seek the advice of a lawyer to assist them with their issue.

Modern awards establish a set of minimum conditions for employers and employees across Australia who work in similar industries or occupations.

Transitional arrangements found in most modern awards give employers and employees time to adjust to the changes in pay rates (including loadings and penalties) over a five year period from when the modern awards system was implemented.

Modern awards may contain:

• model transitional provisions that phase in changes to pay rates from 1 July 2010 across a five year period;
• specific transitional provisions unique to the modern award and dealing with pay and/or other conditions; or
• no transitional arrangements, in which case the full terms of the modern award apply from 1 January 2010.
  

The model transitional provisions apply to most modern awards and pay rates will continue to change as the modern award rates of pay are phased in over a period of five years from 2010. The full modern award rates apply from the first pay period on or after 1 July 2010.

Under the Fair Work Act (FWA), all Australian employees are entitled to general workplace protections, which may include the following:

• workplace rights;
• the right to engage in industrial activities;
• the right to be free from unlawful discrimination;
• the right to be free from undue influence or pressure when negotiating individual workplace arrangements.

The term "workplace right" is broadly defined under the FWA, and is generally present in regards to any roles or responsibilities that may exist, or any entitlement to benefits which is outlined in the relevant award, agreement or any order made by an industrial body.

Furthermore, under the FWA, employees can exercise their workplace right to either initiate or participate in any processes or proceedings which is covered under the relevant workplace laws or instruments, whilst also having the capacity to lodge a complaint or inquiry:

• to a body or person seeking compliance with either a workplace law or instrument;
• in regards to any issues relating to an employee's work.

If you are an employee who feels that you aren't being adequately protected at work, seek immediate legal advice.