The Applicant claimed that the employee was dismissed because he proposed to exercise a workplace right (with respect to his accrued paid personal leave) to prevent the employee from exercising the right. The Applicant further claimed that the employee was entitled to payment in lieu of notice as well as his accrued annual leave entitlements.

The employee was diagnosed with a form of blood cancer on 22 December 2010 and as a result would require chemotherapy to treat the cancer. The employee informed the Second Respondent of the diagnosis on 23 December 2010. The employee alleged that from 23 December 2010 until his dismissal from employment ton 3 February 2011, the Second Respondent had placed pressure on him to resign from his employment.

The Applicant relied on the evidence of the employee to support an allegation of coercion by the Respondent. With respect to coercion, the Fair Work Act states that:

A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person, or a third person, to:

(a)  exercise or not exercise, or propose to exercise or not exercise, a workplace right; or

(b)  exercise, or propose to exercise, a workplace right in a particular way.

The Respondent claimed that the employee resigned voluntarily.

Justice Gilmour of the Federal Court did not find the Second Respondents’ evidence convincing, preferring rather, the employee’s evidence. On this basis, Justice Gilmour found that the employee was dismissed and that the dismissal was to prevent the employee from exercising his workplace rights to receive his substantial sick leave entitlements. Justice Gilmour ordered that compensation in the amount of $14,991.13 be paid to the employee and adjourned the matter of penalties pending submissions by the parties on the issue.

The NTEU alleged that the redundancy was in fact a sham and that adverse action was taken against the Professor because she had exercised or planned to exercise workplace rights. Some of the workplace rights which Professor Bessant exercised related to claims of bullying and intimidation against the head of the school. Justice Gray did not examine in detail the definition of workplace rights because the “various complaints and claims made by Professor Bessant are conceded by RMIT to have been the exercise of her workplace rights”.

RMIT put their case forward on the basis that the decision with respect to redundancy was made by the Vice-Chancellor, Professor Gardner. Justice Gray considered whether the evidence provided by Professor Gardner discharged the reverse onus of proof that Professor Bessant was not made redundant because she exercised or planned to exercise her workplace rights. Justice Gray did not find Professor Gardner’s evidence that the redundancy was purely due to financial reasons convincing. As such, he went on to look at the dismissal in its greater context.

Justice Gray commented that the “lack of a clear and cogent process of reasoning, leading to the conclusion that Professor Bessant needed to be made redundant, at any stage of the lengthy and detailed process, is a major factor pointing to the conclusion that there may well have been reasons other than those that were expressed for the making of that decision. Before determining whether this conclusion is valid, it is necessary to examine a couple of other issues.”

Justice Gray found that RMIT had not discharged the onus of proving that Professor Bessant was not made redundant because of a prohibited reason, namely that she had exercised or planned to exercise her workplace rights. In addition to a contravention of a general protection, Justice Gray also found that RMIT had breached its enterprise agreement in not offering Professor Bessant the option of participating in a voluntary redeployment process.

Justice Gray ordered that Professor Bessant be reinstated. In light of the fact that RMITs conduct was in breach of two civil remedy provisions, Justice Gray stated that the need for specific deterrence was quiet high and that “Employers must understand that making use of redundancy as a pretext for getting rid of an undesired employee is not an option, if the reasons for wishing to get rid of that employee would be proscribed by the Fair Work Act.”

In total, Justice Gray ordered that $37,000.00 be paid as a penalty for two contraventions of the Fair Work Act.

This decision should serve as a lesson for employers that redundancy should not be utilised as a mechanism for removing an undesirable employee from working for the employer. In making an employee redundant, consideration of and engaging in a genuine redundancy is critical to ensure compliance with the unfair dismissal provisions of the Fair Work Act. Furthermore, such documentation can be critical in cases such as the above where an employer must satisfy the reserve onus of proof, that is, that adverse action was not taken for the prohibited reason.

To celebrate the success of the past year, here’s a run-down of the most popular posts from the past year:

1. “Here’s a Riddle”, presented solutions to the puzzle of performance management.
2. “The Super Contributions Increase”, provided details of the increase to super contributions.
3.“What to do When you Overpay an Employee”, let you know the best way to recover overpaid wages.
4. “Your Paid Parental Leave Questions Have Been Answered!”, gave you a factsheet in response to the record number of questions asked in the webinar the previous week.
5. “How Will the Superannuation Increase Affect Salary Packages?”, answered your questions about salaries and superannuation.

Thanks for your support, we hope you found Takeaway Tuesday useful. Now, for something new.

Our new direction was born out of a desire for conversation. EI and Employment Hero were built around addressing the needs of SMEs, something which could not have been achieved without countless conversations. Yet, looking back, they are never recorded or celebrated for the value they give. We think they should be shared, as they offer insight into the plight of the small business employers and the challenges they face.

So from next week, Thursdays are the new Tuesdays and we’ll bring you the first of many conversations we’ll be having with small business employers. Each week we’ll be out on the street, starting conversations and sharing them on the blog.

What will we talk about?
Whatever is important to you as a small business and employer.
Whatever is happening on the legislation front which affects you.
Your stories, your experiences, your gripes and your successes.

Why?
Because there are over 2 million small businesses in Australia, they are the backbone of the economy and we think this group is too important to ignore.

How can I be involved?
You can also contribute to the discussion via email or our social media platforms, we’ll also feature every business we have a conversation with on our photo wall, if you would like to be featured, email us at info@thinkei.com or find us on Twitter @Think_EI.

1. The company rate promised tax cut:
A cut to the rate of 30% company tax was promised last year without delivery. With the large deficit rumoured to be at around $17 billion, a cut this year is unlikely to be announced.

2. Minimum wage increase:
The national minimum wage increase will be announced next month and will apply from July 1st. Predictions are for an increase of around 2-3% . If you are unsure after the increase as to staff pay rates, we recommend seeking legal advice. This increase, together with the extra 0.25% to be added to superannuation, will be challenging for small business.

3. Transitioning of awards:
The transition to pay arrangements under Modern Awards will continue into its fourth year, come July 1st, meaning another round of transitioned pay rates and penalties. Employers struggling with transitioning of pay rates should seek advice as to rates that apply from 1 July.

4. The Coalition’s IR Policy announcement:
There was hope from small business owners that the Coalition would announce plans to reduce penalty rates from awards – particularly in sectors that operate across seven days, such as retail and hospitality. Tony Abbott has specifically stated at the press conference launching the policy that changes to penalty rates was not part of the Policy.

1. Think small business is small time?
Small business contributed around 34 per cent of private industry value added in 2010-11, or approximately 20 per cent of GDP. They also employed around 4.8 million people in 2010-11, which equals approximately 46 per cent of private sector employment. (Taken from the Small Business Data Card.)

2. Are you a sole trader looking to make that first step into a small business?
There are 5,000 pages of legislation related to employers hiring their first employee, you can find more details here.

3. Free trials?
Trials are generally used to find out whether a job applicant is suited for a job. As a general rule, a prospective employee must be paid for any trial work they have performed to establish their suitability for a role, whether they are hired or not.

4. Are you Big Brother?
Whilst it is sometimes important to be vigilant, there can be no video cameras in toilets, changing rooms or workplaces and surveillance in public areas must be explicitly agreed to by the employee in the employment contract.

5. Think it’s plain sailing ahead?
Businesses with between 6 and 19 employees are the most likely to have experienced a dispute where they took legal action or utilised a third party intervention. These businesses are also most likely to have experienced disputes overall, with 28% having experienced a dispute of some kind (including routine and easily resolved disagreements). (Based on interviews conducted with over 2,000 Australian businesses selected at random. Read the full research paper here.)

Feeling overwhelmed?

You can find all the documents you need to hire your first employee here.

• letters of appointment
• performance management 
• termination
• completion of probation letters

Sheryl Sandberg’s recently published book “Lean In” has been described as the modern manifesto for women in the workplace. I can also attest that it offers just as much value for men. Despite having worked both with and for women for decades the book gave me a clearer perspective the unique challenges and difficult decisions women face while managing their careers.

“Lean In” also highlights a significant issue faced by employers when it comes to how to retain female employees who decide to start a family, be it in the near or distant future. The problem arises from whether (or not), employers should be discussing it first. Australia’s employment and discrimination laws prohibit treating women differently (unfairly) on the basis of pregnancy, breastfeeding and family responsibilities. This is known as ‘adverse action’. Therefore, simply asking employees about their family plans may expose employers to claims of adverse action which are expensive and difficult to defend. Employment lawyers typically advise against asking questions like this during interviews and reviews.

However, in “Lean In” Sandberg suggests that managers should have an open dialogue with staff regarding their parenting decisions and timing. The idea being that this knowledge allows employers to easily provide the support and opportunities that women need to juggle their family and career. She gives some great examples of ways to keep women engaged at work to avoid “leaving before they have left”, admitting that she has openly asked employees about their parenting plans despite the legal risk.

The book suggests many things employers can do to help overcome these challenges such as special parking for pregnant mothers, child care arrangements, flexible work and more opportunities for women to speak up and support each other. But how is it possible to implement this extra support in the face of the high risk, potentially contentious conversation which ultimately precedes it? The laws that aim to protect against discrimination appear in this way to be perpetuating it, as they can hinder vital communication between employer and employee. This is a troublesome legal conundrum that Australian legislators need to resolve.

Have you ever experienced a situation where you were afraid to ask an employee a question that would otherwise enable you to provide more support and assistance to an employee? How did you deal with this situation?

The Full Bench looked at the requirement relating to termination of individual flexibility arrangements and decided to increase the notice period from 28 days to 13 weeks as they stated that the variation “will enhance the operational effectiveness of the model term and is consistent with the modern awards objective”.

Furthermore, the Full Bench considered the importance of an individual flexibility agreement being genuinely agreed to and not entered into due to coercion or duress. The Full Bench considered that where a prospective employee is approached about an individual flexibility agreement prior to commencement of employment, it is “extremely unlikely that the employee will genuinely agree by engaging in an assessment of the potential worth of benefits foregone with the benefits gained.”

The Full Bench determined that variations to the model flexibility clause will be made with respect to:

a)    Clause 7.2, which sets out that the agreement between the employer and employee must be a genuine one without coercion. The variation adds a sentence which reads, “An agreement under this clause can only be entered into after the individual employee has commenced employment with the employer”.

b)    Clause 7.3 (b), which addresses that the agreement between employer and employee must result in the employee being “better off overall”. The variation reads “at the time the agreement is made”.

c)    Clause 7.8 with a variance to the notice period required to terminate the agreement being increased to 13 weeks from 28 days.

d)    Clause 7.8 which includes a note that reads:

If any of the requirements of s.144(4) which are reflected in the requirements of this clause, are not met then the agreement may be terminated by either the employee or the employer, giving written notice of not more than 28 days (see s.145 of the Fair Work Act 2009 (Cth)).

The requirements of s. 144(4) include that the flexibility term must:

(a)   identify the terms of the modern award the effect of which may be varied by an individual flexibility arrangement; and

(b)   require that the employee and the employer genuinely agree to any individual flexibility arrangement; and

(c)   require the employer to ensure that any individual flexibility arrangement must result in the employee being better off overall than the employee would have been if no individual flexibility arrangement were agreed to; and

(d)   set out how any flexibility arrangement may be terminated by the employee or the employer; and

(e)   require the employer to ensure that any individual flexibility arrangement must be in writing and signed:

(i)  in all cases–by the employee and the employer; and

(ii)  if the employee is under 18–by a parent or guardian of the employee; and

(f)   require the employer to ensure that a copy of any individual flexibility arrangement must be given to the employee.

The Full Bench stated that determinations giving effect to the decision will be settled by Senior Deputy President Watson. This means that the new flexibility model clause will be inserted into modern awards as the determination in respect to each relevant award is m

Anti-Discrimination provisions regarding discrimination in employment on the basis of a criminal record are found in Federal and some State and Territory Laws (not in NSW). This raises a number of concerns for employers regarding whether employers can conduct a criminal record check or ask a prospective employee or employees about a criminal record.

We previously addressed in our fact sheet – titled “Discrimination Laws and Criminal records” that in order for an employer to avoid a claim of discrimination on the basis of a prospective employee or employee having a criminal record, an employer should consider whether the existence of a criminal record prohibits the employee from performing the inherent requirements of the job. An inherent requirement is something that is ‘essential’ to a position rather than incidental or peripheral.

In circumstances where a criminal record check has not been conducted, an employer can still ask a prospective employee or employee to disclose a criminal record. In such circumstances however, it is recommended that there be a connection between the requirements of a particular job and the request for information about a criminal record. It should be noted however, that there is no absolute requirement for a prospective employee or employee to answer a question in relation to a criminal record or to disclose a criminal record.

Pittard believes that the increase in criminal record checks reflects that they are being “increasing used as a recruiting tool by employers, even where there are no mandatory requirements for checking criminal histories”. The Fair Work Act 2009 (“the FW Act”) does not provide that the requirement of “irrelevant criminal record checking in respect of a prospective employee or employee” be a protected ground of discrimination, however, the Australia Human Rights Commission Act (Cth) (“AHRC Act”) may find that certain conduct constitutes discrimination; although the AHRC Act does not make the conduct unlawful.

Whilst the Fair Work Act has not addressed the requirement of an irrelevant criminal record check as a protected ground of discrimination, employers should nevertheless consider the contextual requirement of conducting such a check in the greater context of the industry of the employer (and whether such a requirement is reasonable), the job the employee will be performing and other relevant considerations.

When the contribution increases, will the wages costs need to go up, or can my rates and salaries go down to offset the increase?”
The answer will depend on the wording in the contract. If the employment contract was clearly drafted as paying an employee a ‘package’ which is inclusive of base salary and super contributions as required, the contractually agreed ‘package’ amount may remain the same, depending on the exact wording of the contract, as this forms the contractual terms between the parties.

However, if a contract specifies a base salary or hourly rate, plus super, then an employer could not reduce an annual salary or hourly rate to offset the increase to super contributions, as this would be a breach of contract and may also mean an employee’s hourly rate falls below an award or agreement minimum.

Businesses should seek legal advice before taking any action concerning the reduction of base salaries or hourly rates. Our experienced workplace lawyers provide affordable first-class legal services in plain English, without the jargon.

Fill out our form for a free consultation and we’ll be in touch.

For more information on the upcoming changes to Superannuation – click here.

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