FAQ From Employers on Employee Management

It can be challenging for employers to juggle the legal complexities of employee management on a day to day basis along with their other duties. Employee management encompasses a large variety of aspects, such as managing employees’ legal rights, entitlements, and obligations an employer has to their employees in the workplace, as well as ethical and legal steps to take to manage underperforming staff and on-boarding or terminating employment — all while minimising the risks of any possible claim or legal action.

The mismanagement of employee entitlements can have serious consequences. Below, we have answered some of the frequently asked questions we receive from employers regarding employee management in the legal context to safeguard their business.

1. What should I consider when onboarding a new employee?

Before onboarding a new employee, be sure to prepare the employee’s employment agreement and provide any supporting documents, such as an employee handbook with the outlined policies. A good rule of thumb is to follow the following checklist:

• Employment agreement

• Company policies and handbook

• Fair Work Information Statement

• Payroll form

• Superannuation choice forms

Although an employee handbook is not a necessity, it is very beneficial to create and implement a comprehensive guide so that employees understand their rights, responsibilities, obligations, the code of conduct, WHS policies and more.

2. What is probation management?

A probationary period in the employment context refers to the status of newly on-boarded employees in a workplace in which an employer has the opportunity to assess whether the employee is capable, reliable and well-suited to perform the duties of the position they have been hired for. Generally, an employee’s standard probationary period is 3-6 months from the start of employment. Details of the probationary period must be written into the Employee Contract and agreed to prior to commencing employment.

If you don’t believe your employee is a good fit, it is easier to terminate employment during the probationary period without facing an unfair dismissal claim. However, the dismissal must still be fair, just and reasonable to the conditions in the Fair Work Act 2009. Employees have to be employed for 6 months before they can apply for unfair dismissal, and for small businesses this period is 12 months. 

3. I need to make redundancies. What do I do?

For many businesses changing and restructuring their operations, in some cases redundancies may be required. This can be a tough aspect to navigate, especially if you do not have a thorough understanding of how redundancies, employment termination, and fair and unfair dismissal. The following steps should be taken when considering making an employee redundant.

• Is it a genuine redundancy? A genuine redundancy arises when the employer no longer requires the person’s job to be performed by anyone due to changes in the operational requirements of the enterprise, whether it’s new technology, relocation, business close down. The redundancy would not be considered to be legitimate if the employer still needs the affected employee’s duties to be undertaken by someone else.

• Have you consulted with affected staff prior to taking action? During a redundancy process, it is essential to consult with the affected staff before taking any action. This ensures that employees are not let go unfairly or on a discriminatory basis which could lead to an unfair dismissal or general protections claim. Staff should be assessed on their performance to fairly select which staff member to make redundant based on criteria.

• Is there alternative employment for the employee in the business? Based on the staff’s skills and role, employers should assess whether there are any alternative employment opportunities for the staff member in the business and seek feedback from the employee before moving forward with the redundancy.

The redundancy process can be complex for employers not familiar with the process, therefore we always recommend consulting with an industry expert in employment law prior to making any decisions with redundancies.

4. What are some of the key things to be addressed in an employment agreement?

Whether you are updating employment contracts for your staff or drafting them for the first time to onboard new employees, the following are key things that should be addressed in the employment agreement.

• A clear and concise job description

• Salary and wage details (including details of superannuation, overtime, bonuses and allowances, and a remuneration review)

• Whether the employee is hired on a full-time, part-time or casual basis

• A clear outline of duties and responsibilities for the position to ensure accountability

• Leave entitlements (including annual leave, personal leave/sick leave, compassionate leave, long service leave, bereavement, and parental leave)

• Confidentiality requirements about business practices and consequences for breach.

• Non-compete/Restraint of trade clause for creating boundaries when employees engage with clients or businesses in competition with the employer during or after their employment period, as well as time restrictions in relation to this clause.

• Protection of intellectual property clause.

• Termination process, including outlining how much notice both employer or employee must give for ceasing employment.

• A dispute resolution clause to specify the outcome in the event a dispute occurred between the employer and employee and under what grounds.

Navigating the legal complexities of employee management can be challenging for employers, especially on top of their regular managerial and operational duties in the business. At Optimum Legal, we work with you as an extension of your business. Our team of employment lawyers are by your side every step of the way to answer any queries or concerns you may have. 

Book your free initial consultation, here.