SLC’s Top Five Series: Hiring Staff
Here are our top 5 tips for your employment contracts:
- What type of employment are you offering? Permanent? Casual? Full time/ Part time? Clearly define the type of employment (including hours and expectations if part time) and clearly define the role and expectations on the employee – include a position description if possible, if not at least a schedule of proposed duties. BUT don’t forget to include that you may need the employee to perform other duties also.
- Does a Modern Award apply to the employee? If so, what award and what classification. Each Award has different minimum entitlements which cannot be contracted out of – with some exceptions for over award annual salary payments and flexibility arrangements. Awards apply depending on the work the employee does – one employer may have employees covered by a number of Awards – eg clerical, professional services award, etc.
- Remuneration: we all want to be clear on what we will be paid for the work we do: is it an hourly rate? An annual salary? Do you offer additional payments or benefits, like an annual bonus – is it guaranteed or is it dependent on business or individual performance? Will part of the employee’s pay be linked to criteria like an incentive payments? How are commissions to be structured? When will they be paid? Don’t forget Superannuation – is it included in total compensation or an additional amount on top? Bear in mind any minimum wage entitlements that may apply to your employee– too many businesses have been caught out not complying with minimum payments. Make sure you check at least annually that you are paying above minimum wage rates – minimum wage is reviewed each June with changes taking effect 1 July.
- Leave: have you captured minimum requirements under the National Employment Standards: 20 days annual leave, 10 days personal/carer’s leave, compassionate leave, community service leave? Are there are other leave entitlements particular to your workplace? What processes do you want employees to comply with when applying for leave?
- Ending employment: whilst no one wants to think about what happens if an employment relationship ends when, it is important for a contract to be clear as to how and when the employment can end – what period of notice should apply (bearing in mind the National Employment Standards proscribe a minimum period of notice dependent on years of service). A failure to include a notice period can mean that the employee can seek “reasonable notice” which could be a very long period if the employee is senior or been there for a long time. Consider setting out what happens on termination: garden leave (ie the employee is not required to work during the notice period but remains employed – with the benefit of the employee being bound by their obligations for that period but without access to the business’ sensitive and confidential information), pay them out their notice instead of remaining employed, and consider whether the business is concerned if the employee leaves and starts work competing against the business the next day, or poaching clients/staff – do you want to consider including a post termination restraint?
