Legally Fit®
LEGALLY FIT®: GETTING IT RIGHT WITH YOUR EMPLOYEES (PART 1)
Although many fitness business owners have a ‘go hard’ approach to training, they don’t always take a similar approach to managing one of their potentially greatest assets: their employees.
In his management training programs, Justin Tamsett of Active Management says ‘Hire easy, manage hard. Hire hard, manage easy’. Other management consultants have similar mantras about getting the right people for your business.
Sometimes, however, despite the use of best practices (including for hiring, training and performance managing employees), fitness businesses do not get the hiring process right, or an employee may simply not be the right fit.
In such cases, a further mantra should (unfortunately) be added: ‘Hire hard, fire hard and fast’ (where there are appropriate grounds to do so).
While this approach may not always be the best way to manage your business and employees, if a team member’s employment is just not working out for the employer or the employee, it generally does neither party any favours to continue it.
In this instalment of Legally Fit™, we therefore look at some of the legal issues that should be considered when hiring an employee.
Rights of Applicants
Job applicants have rights with fitness businesses to which they have applied, even if they are never offered employment by, or accept employment with, that business.
State and Federal legislation prohibit employers from discriminating against an applicant (and employees) on the basis of a range of attributes: race, colour, sex, sexual preference, age, physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin. Thus, evaluation of applicants and hiring (and other employment) decisions should be undertaken on (preferably consistent) non-discriminatory selection criteria.
Employers must also not breach the (other) ‘general protection’ provisions of the Fair Work Act 2009 (FWA) or take (other) ‘adverse action’ against an employee or prospective employee because a person has or exercises a ‘workplace right’.
For instance, as discussed in the last article in this series, offering employment on an independent contractor basis, for an arrangement which actually constitutes an employee relationship, could be a breach of the general protection provisions (potentially resulting in significant penalties being imposed on not only the employer, but also others involved in the hiring process) even though the offer occurred prior to the employee actually being engaged.
Thus, employers (and their employees involved in the hiring process and other human resource functions) should familiarise themselves with those requirements.
(Some of the ‘general protection’ and ‘adverse action’ provisions will be further discussed in subsequent Legally Fit™ articles.)
What Governs the Employer/Employee Relationship?
An employer/employee relationship is governed by common law principles, the requirements of the fair work legislation, any applicable award, the terms of any ‘enterprise agreement’ and the terms of the employment agreement/contract.
Enterprise agreements are basically agreements made between an employer and its employees at an ‘enterprise’ level as opposed to being directly entered into between the employer and each employee individually.
The terms of an employment agreement/contract can be written or verbal, but should preferably be in writing. However, before discussing employment agreements/contracts, it is important to consider the minimum terms and conditions which will apply to fitness industry employees.
Minimum Terms and Conditions
The FWA sets out minimum terms and conditions for most private sector employees, and employment agreements are subject to the minimum entitlements and conditions contained in the National Employment Standards (NES) and any applicable award.
NES
The NES are part of the FWA and set out 10 minimum entitlements, namely:
1. Maximum weekly hours – 38 hours per week, plus reasonable additional hours
2. Requests for flexible working arrangements – certain employees can ask for a change in their working arrangements
3. Parental leave – up to 12 months unpaid leave per employee, as well as the right to request an additional 12 months leave
4. Annual leave – four weeks paid leave per year, plus an additional week for some shift workers
5. Personal/carer’s leave and compassionate leave – 10 days paid personal/carer’s leave per year, two days unpaid carer’s leave and two days compassionate leave (unpaid for casuals) as required
6. Community service leave – unpaid leave for voluntary emergency management activities and leave for jury service
7. Long service leave – paid leave for employees who have been with the same employer for a long time
8. Public holidays – a paid day off on a public holiday, unless reasonably requested to work
9. Notice of termination and redundancy pay – up to five weeks’ notice of termination and up to 16 weeks redundancy pay, based on length of service
10. Fair Work Information Statement – must be provided to all new employees.
Failure to comply with the NES (and other provisions of the FWA), such as failing to provide the Fair Work Information Statement to new employees, exposes employers to potential penalties of up to $10,200 for individuals and $51,000 for companies. Did you provide a Fair Work Information Statement to the last employee you hired?
It should also be noted that even employees of employers can be exposed to penalties under the ‘accessorial liability’ provisions of the FWA if they are involved in a breach of the FWA.
Fitness Industry Awards 2010
Employment agreements must also be read subject to any applicable award, such as the Fitness Industry Award 2010 (Award). The Award sets out the minimum wages and conditions for employers engaged in the fitness industry and their employees covered by the Award. The minimum conditions set by the Award are in addition to those contained in the NES.
Every fitness business should familiarise itself with the Award to determine which of its employees are covered by it and what entitlements are required to be provided to those employees. It is also important to continually monitor the position with your various employees because there can be changes in entitlements (e.g. requirement to pay a higher wage), for instance, if the nature of the work changes.
Details on the Award, NES and other useful employment information can be obtained from fairwork.gov.au.
Why the Need for a Written Employment Agreement?
Even though all employees will have minimum terms and conditions as set by the above referenced instruments, written employment agreements can help avoid disputes. In appropriate circumstances, they can not only provide protection to the employer, but may also assist in providing the best chance for an employee to succeed in your business.
The next instalment in the Legally Fit™ series will further discuss some of the issues that should be considered with regards to employment agreements, and look at how to minimise difficulties when things don’t work out.
This article has provided a general outline only of some of the issues relating to hiring employees. It does not constitute legal advice and should not be relied upon as such. Specific legal and financial advice should be obtained in relation to the specific details of each proposed employment arrangement.