Get ready for new employment laws starting New Year’s Day

With only two days left until Christmas, businesses are either closing down or bracing themselves for the rest of the holiday season. But many are still unaware that on January 1, new industrial relations laws will come into effect, changing how they run their business – a deadline easy to forget when the office is closed.

New Year’s Day will see the introduction of new National Employment Standards and Modern Awards systems. These two introductions will prompt dramatic changes for industrial relations, and businesses need to be aware – or risk facing legal action.

The laws are complex, and apply differently to businesses depending on size and industry, but here are the most important points SMEs need to remember in order to prepare for the next wave of workplace legislation.

National Employment Standards

Work Choices gave five minimum entitlements for employees, but the new National Employment Standards, which the Rudd Government describes as a “safety net”, contain 10 provisions:

• Maximum weekly hours of work
• The right to request flexible working arrangements
• Parental leave and related entitlements
• Annual leave
• Personal/carer’s leave and compassionate leave
• Community service leave
• Long service leave
• Public holidays
• Notice of termination and redundancy pay
• Provision of a Fair Work Information Statement

Most remain unchanged from Work Choices. However, employers need to be aware of changes regarding flexible working arrangements.

Under the new laws, any employee who is a parent, or cares for a child under school age, can request flexible working arrangements such as new work schedules or even locations. They must have had 12 months of continued service, with casual employees requiring 12 months service and have a reasonable expectation of continuing regular employment.

The Fair Work legislation says reasonable business grounds include the affect on the workplace and the employer’s business of approving the request, the inability organise work among existing staff and the inability to recruit a replacement employee.

The maximum weekly hours provision is a standard 38-hour week, but the new laws state the maximum weekly hours cannot be averaged over a 12-month period.

When asking employees to work reasonable additional hours, employers must consider the employee’s personal circumstances, whether the employee is entitled to receive overtime payments, penalty rates or other compensation, the employee’s role and responsibilities, typical industry working patterns and the notice period given.

In regards to parental leave, employees can now request an additional 12 months parental leave, to be requested at least four weeks before the end of the original leave period. An employer can only refuse that request on “reasonable business grounds”.

Provisions for annual leave have also changed, with four weeks of leave now given to employees. Shift workers receive an additional week of annual leave for every year of service with their employer.

Notice of termination and redundancy pay has received a change, with redundancy entitlements now written in the law for any company with 15 or more employees.

Fair Work Information Statements are now required to be given to employees stating the 10 employment standards, modern awards, agreement making, freedom of association and the role of Fair Work Australia.

Another big change comes in the form of new “Modern Awards”. Many employees will now come under the new safety net which will provide new minimum conditions.

The Government intends to consolidate 2,500 awards into about 120, without taking away any advantages or benefits for employees or increase business costs. However, many businesses are still unsure whether their employees will be covered under certain awards, and whether the “miscellaneous award”, which covers employees not covered by another modern award, applies to certain workers.

SmartCompany legal expert Peter Vitale says employers should consider whether they are actually award free, and contact Fair Work if they are in doubt.

The Fair Work Ombudsman has also released a checklist for employers to consider:

• Do you know which Award your business is currently covered by and which Modern Award will apply after January 1?
  
• Are arrangements in place so that the business will comply with the National Employment Standards when they come into force on January 1?
  
• Are you keeping the required records and giving employees pay slips?
  
• Are you aware of your options for making an Enterprise Agreement with employees?
  
• Do you understand how to bargain in good faith if you want to make an Enterprise Agreement with employees?

Do you understand and are you able to comply with the Small Business Fair Dismissal Code if terminating an employee’s employment?

Check out these links for more information on the new Fair Work laws:

• No agreements without unions.
  
• Flexible work shock.
  
• The unions’ new bargaining ploy.