The enterprise agreement is not often used by small business but can provide some unique benefits by simplifying the relationship between the employee and employer.

With the introduction of the modern awards most employees in Australia, with a few acceptations, will fall under an award of some sort. Even if you are paying your employees above the award rates (which mostly everyone does) your employees will still be entitled to all the conditions stipulated in that award. For example under the professional services award 2010, which covers IT workers and Engineers who work for vendors; an employee is entitled to 17.5% loading on holiday pay.  Further most companies are covered by multiple awards which makes the arrangement even more complicated.

An enterprise agreement can level out all the variables across these awards establishing a simplified employment agreement with all your employees.

The process of setting up an Enterprise Agreement is relatively simple and once approved will provide the organization with a consistent employment platform for a period of 4 years after which time it will require renewal.

There are multiple types of Enterprise agreements but for most it will be a ‘single-enterprise’ agreement. An imperative in developing your Enterprise agreement is to work with your employees in a consultative manner gaining their agreement throughout its development. The best way to do this is to allow the employees to nominate a ‘bargaining representative’ who will represent the wishes of the employees. Likewise, the employer is also entitled to appoint a bargaining representative thereby making the development process simple and efficient.

How to get started?

If you don’t have an on board HR specialist, you may want to consider contracting someone who has experience in this type of work to help you through the process as it is a specialized field requiring knowledge in modern awards and related ACTS.

In the first instant, it’s important to understand what it is that you’d like the EA to achieve over the 4 year period; what are the business goals. An example might be to simplify payroll processing by paying a salary where the employee agrees to forgo the 17.5 % holiday loading and penalties, agree on salary adjustments over time so you can forward plan on your cost base and make determinations about how overtime, leave and related issues are to be managed etc.

Next, it is important to closely consult with the employees to gain their agreement. This necessitates the employees being given a copy of the agreement to review and then voting to accept or reject the agreement as negotiated. If the majority of employees agree, then the agreement is given to the Fair work Authority who will formally ratify it.

Short-term pain for long term gain.

The concept of introducing an Enterprise Agreement might, for some, seem a “bitter pill to swallow”. On the other hand, a few week’s worth of work (most of which is delegated) will help your organization focus on what’s important over the next 4 years and will provide stability, efficiency and improved productivity.    
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The new Work Health and Safety (WHS) laws replaced the Occupational Health and Safety (OHS) laws in NSW on 1 January 2012.  

These new laws will provide greater consistency, certainty and clarity across Australia making it easier to understand your workplace health and safety duties. Businesses and volunteer organisations that operate over several states will now be able to initiate nationwide safety policies and procedures without needing to take into account the differences in legislation from state to state or territory that used to prevail under the old system.

As a general rule, if you are complying with the old OH&S laws you are well on the way to complying with the new WHS laws.


What are transitional arrangements?


Don’t panic about having everything in place right now! To assist business, industry and the community, transitional arrangements have been implemented.  For example, existing OHS committees will become WHS committees and these committees will have 12 months to ensure their membership aligns with the new legislation.


Transitional arrangements have been put in place in NSW and other states to support businesses, industry and workers move to the new system of work health and safety laws.


In summary these provide for:


  • Recognition of existing information, records or other documentation that is substantially the same as work health and safety (WHS) requirements
  • Transitional periods of 12-18 months where there is a change in training requirements;
  • Only requiring retraining or reassessment if the requirements are substantially different
  • Transitional periods of 6-12 months (in most cases 12 months) where a duty or requirement is new; and
  • Up to 24 months for some new obligations where industry might have difficulty in complying for reasons beyond their control

So what is new?

  1. If you are an employer, sole trader, association, partnership, corporation or volunteer organisation with paid workers, you will be classed as a person conducting a business or undertaking (PCBU). PCBU will therefore replace the current term employer.


  1. If you are an employee, volunteer, labour hire staff, apprentice, work experience student, trainee, outworker, sub-contractor or contractor, working for a PCBU you will be classed as a worker. Worker will replace the current term employee.  Note however that a contractor for example can be both a PCBU and a Worker at the same time meaning that they will carry both responsibilities defined below.


  1. If you are a supplier, designer, manufacturer, importer, or manager or controller of a workplace, you will have specific duties in addition to those as a PCBU.


  1. Health and safety representatives (HSRs) will replace current OHS representatives and play a key role in the consultation process.


  1. PCBU consultation with workers is an important element of the new legislation as is consultation between PCBUs in the case of more than one PCBU.


  1. It is a legal requirement to provide notification of serious workplace accidents and incidents as well as responsibility to preserve the site where the incident occurred


  1. If you work in – or even just visit – a workplace, you will have WHS rights and duties.

Responsibility of Directors and Officers

Officers, including company directors, are individuals who have high level obligations for work health and safety and are defined as anyone who makes decisions, or participates in making decisions.These obligations are important as health and safety commitment and leadership from the top levels of the business or undertaking is critical to health and safety outcomes.Therefore, officers must ensure the person conducting a business or undertaking has arrangements in place to comply with its legal obligations.It is an officers duty to exercise “due diligence” to ensure their business or undertaking fulfils its health and safety obligations under the Work Health and Safety Act 2012.The essential elements of “due diligence” for an officer are interrelated and cumulative in nature. These elements require an officer:


  • to acquire and keep up to date knowledge of work health and safety matters. Ignorance is not an excuse.


  • to gain an understanding of the operations of the business and the hazards and risks involved


  • to ensure appropriate resources and processes are provided to enable hazards to be identified and risks to be eliminated or minimised


  • to ensure information regarding incidents, hazards and risks is received and the information is responded to in a timely way


  • to ensure the PCBU has, and implements, processes for complying with any legal duty or obligation


  • to ensure processes are verified, monitored and reviewed.


Though not exhaustive, these elements form part of a unified system for ensuring organisational compliance. So in other words the management team within an organisation have definitive responsibility to ensure the health and safety of their workers (new term replacing employee).

Responsibilities of Workers

While at work, workers have responsibility to take reasonable care for their own health and safety, and take reasonable care that their acts or omissions do not adversely affect the health and safety of other persons. It is also their responsibility to comply, so far as is reasonably, with any reasonable instruction that is given by the person conducting the business so that they are in compliance with their legal responsibility as an Officer. Workers therefore must co-operate with any reasonable WHS policy or procedure of the person conducting the business.


The Health and Safety Representative


The employees (workers) of a business have a right to elect a Health and Safety representative who will be their advocate on all things relating to workplace health and safety.  It is not mandatory to have a HSR but if one or more workers request the appointment, then the PCBU must comply and fines apply if they do not. Formal election processes apply to validate their appointment with the typical term being 3 years. HSR’s who have undertaken the proscribed training may make investigate a health or safety complaint as well as making various recommendations.


Notifiable Incidents


It is the responsibility of the PCBU to notify WorkCover of any serious incident that may have incurred in the work environment. Serious is defined as any incident that requires hospitalisation as an inpatient.


How does the Consultation Process Work?


The ACT requires that the PCBU consult with their Workers regarding the Health and Safety of the workplace. For larger firms it may be worth while establishing work groups around various geographic locations or functional categories with a HSR appointed to each group. Workers may also make a request for the appointment of a Health and Safety Committee.  For small businesses however, which WorkCover NSW defines as a business with less than 20 staff (different from Fair Work which defines less than 15) you may determine what are called “Other Agreed Arrangements” where proper consultation between the PCBU and Workers is achieved.


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What do you have to pay a part-time employee on a public holiday?

To answer this question, ask if the employee would normally work on the day designated as a public holiday? If the answer is yes then you will have to pay them at the normal base rate of pay for the hours that they would normally have worked. If the employee does not normally work on that day then no payment is due. Note that the prorate calculation used to determine annual leave entitlements does not apply.

Can an employer ask an employee to work on a Public Holiday?

In asking your employee to work on a public holiday, the request (or refusal thereof) must be deemed to be reasonable. The National Employment Standard had determined a test to determine what is ‘reasonable’. This includes the nature of the work performed and the operational needs of the business, the employee’s personal and family situation, whether the employee is entitled to receive addition compensation by way of overtime, penalty rates etc and duration of the notice given.  An employee has the right to refuse the work request if that refusal is reasonable in nature. Note that to penalise an employee who reasonably refuses to work on a public holiday can be viewed as discrimination.

What do I have to pay an employee who works on a public holiday?

Again this is a confusing area. The Fair Work Act and the National Employment Standard do not make any reference to penalty rates other then the determination in the ‘reasonability’ test. Accordingly, it is the modern award that determines the rate of pay for working on a public holiday. An award free employee would therefore be entitled to the rate of pay specified under their employment contract. Note that the employee is entitled to refuse to work on a public holiday if the pay rate (or other compensation) does not adequately compensate them for this work and the subsequent loss of entitlement.

Skill shortages are still the major risk to most business achieving their strategic objectives. Finding the right level of expertise has always been a challenge but in our current competitive environment the demand for quality staff has exacerbated an already difficult situation. One source of expertise that hasn’t necessarily been given the attention it deserves is the over 50 age group category.

On average these employees tend to be more stable, bring exceptional levels of experience, tend to higher levels of engagement and stay in the job for a longer period of time. So they’re a great investment. Like all other hiring activities it is important to thoroughly screen candidates against the range of hiring measures defined in the job description. Should your short-list  contain candidates who are over 5o, then the government has offered various incentives for you to hire them in that business which employ people aged over 50 will be able to apply for $5000 training grants in an effort to keep more people in the workforce.

Federal Treasurer Wayne Swan and Employment Minister Kate Ellis announced an expansion of the Government's $43 million Experience+ program to extend support to workers aged 50 years and over, down from a previous minimum of 55 years. Employers can apply for grants to train workers so they can become mentors to, or supervisors of, apprentices and trainees.

Australia has 3.1 million full-time and part-time workers aged over 50. The Experience+ program also gives on-the-job support for mature age workers whose jobs may be at risk due to poor health, injury or disability.

The Government will also announce a Corporate Champions project in which large companies will promote the benefits of hiring mature workers.
"The ageing labour force, combined with skills shortages, means it is more important than ever to encourage experienced employees to stay in the workforce," Ms Ellis said.

The Australian Industry Group- which along with the Australian Chamber of Commerce and Industry will lead the Corporate Champions project - believes it makes "sound business sense to encourage mature age workers to stay within the business".

The Department of Education, Employment and Workplace relations provides a considerable amount of information relating to this subject including a white paper “Investing in Experience”.  For more information click"}">here. This post was inspired by an article by political reporter Alison Rehn.

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There are obvious benefits in allowing your employees to work from home. A recent Administrative Appeals Tribunal ruling however highlights, there are also real risks that need to be considered and planned for.

These are not show stoppers but require a process to be put in place that will reduce the related risk on behalf of both the employer and employee.


Background - Case Study

By way of example, there was the recent court case where an employee working for home for a large Telecommunications carrier fell twice in the space of two months whilst going up a flight of stairs in her socks and injuring herself.  Solicitor Rachael James, of Slater and Gordon, said it was a significant win for her client who had left Brisbane to live with her parents in Victoria because of her medical and financial circumstances. "She can't dress herself for work. She is unable to do up a bra or a shirt, or carry a laptop," Ms James said. "She's going to get a whole back payment from the date of the injury up until today, and depending on what the medical evidence says going forward, she could continue to receive those payments until she's 65." The employee is 42 years old and the financial cost could be very significant.

The impact of this ruling therefore offers a serious risk to any employer considering allowing their employees to work from home and must be properly managed.


How to manage the risk?

The answer is not to restrict employees from working from home. Rather, the employer should have a process in place that requires the employee to undertake a risk assessment of the home work environment and surrounds.

This assessment would require the employee to undertake a formal evaluation of all the risks that might cause a potential injury. The evaluation generally follows a check list of likely hazards that the employee may incur in the home, rating the likelihood, consequence, ranking and what they intend to do about reducing the risk.

When complete, this form is then returned to the office and signed by the employee and authorised by the employer. If the employer considers the risk too high they will not authorise home work until they are satisfied that the employee has addressed the issues.


Why bother?

The advantage of implementing a process that leverages this approach is that it ensures the employee is made aware of the likely risks they may incur whilst working from home. This therefore reduces the risk of injury in the first place.   More importantly however, a structured risk evaluation process provides evidence to the court that the employer has taken their workplace health and safety responsibilities seriously and places the responsibility back on the employee to take responsibility for their own welfare.


Where does Work Cover fit in?

Naturally there is always the chance that an employee will injure themselves on the way to work, whilst at work or working from home. The important question to be asked is “is the employer culpable”? The answer to this question is that if the company’s OH&S standards have been followed, then you can be comfortable that you as the employer will not be held responsible.  Accordingly, your work cover insurance will cover the related costs. Do check to make sure that your work cover policy covers home workers."}">Back to Contents