January 2019 has already been a very busy month for Human Outsource and one of the things we have been busy doing is providing guidance to several SMEs on the implementation of employment contracts.
While there is no law that specifies the requirement for a written employment contract, it is good practice to have them in place. By implementing a written employment contract both the employer and employee have a formal record of what has been agreed, which may avoid any unnecessary disputation over the arrangements that are in place.
Importantly, merely having a written employment contract in place is no guarantee that there will not be disputation and having poorly constructed contracts may even create unnecessary confusion, angst and cost to both the Employer and Employee.
Here are 3 tips to ensuring you get things right with written contracts:
1. Regularly review your contract templates. Ensure that your employment contract templates are regularly reviewed. Things change over time; legislative changes regularly occur and judgments in employment-related legal proceedings can change the way an Employer governs how certain entitlements and processes are managed. As such, you need contracts that are reflective of contemporary requirements. Simply relying on old contract templates that you may have sourced from a colleague, friend or even had from a previous employer may not give you the flexibility or protection you need as an employer.
2. The right terms of employment for the right job. When going to the effort of putting a contract in place, make sure you match the right arrangement for the actual job. For example, we often find that SME’s will tend to gravitate toward casual employment arrangements given the perceived flexibility that comes with such arrangements. While a casual employment arrangement can be the right one in certain circumstances, a permanent part time or full-time arrangement may be more reflective of the job to be completed and cost effective given the requirement not to pay a casual loading. Always do your homework and contract with any employee using the most effective employment arrangement (dependent on the situation).
3. Avoid manipulating clauses in a contract. When contracts are created, they are drafted in a manner to protect the interests of the Employer, while also ensuring that the Employee receives entitlements that at least meet any statutory minimum entitlement. As part of the contracting process, employees will often ask for certain clauses to be amended. In these circumstances we encourage Employers to be very cautious and take appropriate advice before making any changes. What may look like a simple change to keep a prospective employee happy, may have unintended impacts ‘down the tack’, which can once again cause unnecessary confusion and angst for both the Employer and Employee.
Should you have any questions relating to employment contracts feel free to contact us anytime on 1300 723 911 or info@humanoutsource.com.au.
