HR Essentials: Employment Contracts

Presented by

Kristin Ramsey

Associate Director

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Session Overview

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Session overview

• Industrial framework

• Preliminary considerations

• Content

• Drafting for flexibility

• Offers of employment

• Contract administration

• Emerging Areas

• Top tips

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Industrial Framework

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Hierarchy

Legislation

EBA/Award

Employment Contract

Policies/Procedures

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Format

LOE

Standard terms & conditions

Policies & procedures

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Risks from poor drafting

• Confusion over terms• Disputes over interpretation• Inadvertent creation of entitlements• Reasonable notice claims• Policies and other documents incorporated• Absence of protective provisions• Limited ability to amend/change• Termination disputes

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Preliminary Considerations

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Preliminary considerations

Contract

TypeLegal landscape

Nature of organisatio

n

AudienceAnything special or unique?

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Type of contract

• Relationship: employee, contractor, other?

• Status: full time, part time, casual

• Duration: ongoing, fixed term, fixed task

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Legal landscape

• Which Awards?

• Underpinned by an EBA?

• Applicable legislation?

• Other industry requirements/guidelines?

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Nature of organisation

• Industry

• Type of work

• Key issues

• Desired arrangements

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Special or unique?

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Audience

• Age

• Education level

• Language skills

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Content

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Basics Specific purpose

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Don’t want to see it !

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Basics

• Position/classification

• Employment status

• Tenure

• Commencement date

• Location

• Probation

• Hours

• General duties & responsibilities

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Basics

• Remuneration • Expenses• Leave entitlements• Public holidays• Compliance with policies• Confidentiality• Intellectual property

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Basics

• Suspension

• Abandonment

• Termination

• Post termination

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Special purpose

• Recognition of previous service• Relocation• Bonuses/incentives• Other benefits• Restraint• Preconditions• Dispute resolution• Other?

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Machinery clauses

• Offsetting• Applicable award• Interaction with other instruments• Right to work in Australia• Warranties• Definitions• Variation• Continuation of terms• Law of the contract

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Implied terms

• Work/wages bargain• Obey lawful and reasonable directions• Good faith and fidelity• Indemnify against expenses• Safe working environment• Reasonable notice • Mutual trust and confidence

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You really shouldn’t …

• Detailed processes and procedures • Highly variable/changeable matters• Incorporation of other instruments

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Now is NOT the time to

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Drafting for flexibility

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Flexibility

• Express ability to vary with notice/consultation• Leave details for policy documents• Ensure additional benefits discretionary

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Making offers of employment

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Offers of employment

√ Be 100% certain

√ Have the contract ready

√ Include any preconditions in contract

√ Be careful when explaining terms

√ Encourage to seek independent advice

√ Insist on signed contract before commencement

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Contract Administration

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Use of templates

• Greater efficiency and consistency• Suitably tailored • Understanding of content • Risk management process• Regular review

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New contracts for existing staff

• When– significant change

• How – consideration– conditional

• Potential adverse action territory!

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Emerging issues

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Emerging issues

• Absorbing superannuation increases• Policy and other document incorporation• Bonuses• Relevance of probation• Salary packaging/offsetting• Contract renewal• Implied term of trust and confidence

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Top Tips

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Top Tips

• Invest in a good set of templates• Don’t amend without considering consequences• Review templates every 1 – 2 years• Get signed contract before commencement• Encourage independent advice• Written variation every time there is a change• Don’t pressure to vary/sign new contracts • Refer to and comply with the contract!

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Questions?

Questions?

Kristin RamseyAssociate Directorkristin.ramsey@hyneslegal.com.au