 The material contained in the answers to these FAQS is provided by way of general information only. It is designed for the purpose of raising your awareness and directing you to other sources of information. It is not intended to be and is not a substitute for advice which evaluates the circumstances of your business/employment. This work is copyright. Apart from any use permitted under the Copyright Act 1968, all other rights are reserved.
The information which is contained herein is accurate as at 1 May 2009.
AUSTRALIAN WORKPLACE LAW
AUSTRALIAN WORKPLACE RELATIONS SYSTEM
AWARD COMPLIANCE
BULLYING & HARASSMENT
DISCRIMINATION
EMPLOYMENT CONTRACT
EMPLOYMENT STATUS
ILL AND INJURED EMPLOYEES
LEAVE – ANNUAL
LEAVE – LONG SERVICE
LEAVE – PARENTAL
LEAVE – PERSONAL LEAVE
LIABILITY
OCCUPATIONAL HEALTH AND SAFETY
RECORD KEEPING
RECOVERY OF MONIES OWED
REDUNDANCY AND RETRENCHMENT
TERMINATION OF EMPLOYMENT
UNFAIR DISMISSAL – FEDERAL SYSTEM
UNFAIR DISMISSAL – STATE SYSTEM (NSW)
WORKERS COMPENSATION
AUSTRALIAN WORKPLACE LAW
What is workplace law? Australian workplace law has three key components. These are: the common law; (federal and state) legislation; and, industrial instruments (awards, workplace agreements and contract determinations). Employers are obliged to comply with each of these sources of law.
What are the obligations of employees and employers under the common law? Under the common law, employers and employees have joint and separate duties. The joint duties owed by an employer and employee include the duty of mutual trust and confidence – in essence this means that both parties are obliged to conduct themselves in a way that does not undermine or damage the trust and confidence the other party has in them.
The key legal duties of an employer include the duty to take reasonable care to ensure the safety of employees. This common law duty falls into three categories: the duty to provide competent fellow employees; the duty to provide safe plant and equipment; and the duty to provide a safe system of work. As the duty is a personal one between the employer and each and every employee, the standard of “reasonable care” will vary between each employee. For example, a higher standard of care may be reasonable when the employee is very young or otherwise inexperienced. Other key duties include the duty to comply with the express terms of the employment contract (including any company policies and procedures incorporated into it) and any relevant laws.
The key legal duties of an employee include the duties to: obey their employer’s orders – so long as these are reasonable and lawful; exercise reasonable care and attend to the work with skill and competence; and provide faithful service. Other key duties include the duty to comply with the express terms of the employment contract (including any company policies and procedures incorporated into it) and any relevant laws.
Breach of any of these duties by either party to the contract can lead to legal action by the other party in a common law court which, if successful, can result in an order for damages. Depending on the nature of the breach and the terms of the contract, other remedies may also be available. In common law matters, costs are usually awarded in favour of the successful party. These can often be very substantial.
What legislation applies to Australian workplaces? A broad range of legislation, both State and Federal, apply to the workplace in New South
Wales. These include:
• Age Discrimination Act 2004 (Cth);
• Annual Holidays Act 1944 (NSW);
• Anti-Discrimination Act 1977 (NSW);
• Disability Discrimination Act 1992 (Cth);
• Employment Protection Act 1982 (NSW);
• Equal Opportunity for Women in the Workplace Act 1999(Cth);
• Fair Work Act 2009 (Cth);
• Human Rights and Equal Employment Opportunity Commission Act 1986 (Cth);
• Independent Contractors Act 2006 (NSW);
• Industrial Relations Act 1996 (NSW);
• Long Service Leave Act 1955 (NSW);
• Occupational Health and Safety Act 2000 (NSW);
• Privacy Act 1988 (Cth);
• Racial Discrimination Act 1975 (Cth);
• Sex Discrimination Act 1984 (Cth);
• Superannuation Guarantee (Administration) Act 1992;
• Trade Practices Act 1974 (Cth);
• Workers Compensation Act 1987 (NSW);
• Workplace Injury Management and Workers Compensation Act 1998 (NSW);
• Workplace Relations Act 1996 (Cth) – subject to transitional provisions, ultimately to be completely replaced by the Fair Work Act 2009 (Cth);
• Workplace Surveillance Act 2005 (NSW).
All of this legislation can be accessed online at www.austlii.edu.au.
AUSTRALIAN WORKPLACE RELATIONS SYSTEM
What is the Australian workplace relations system? Australia has seven different industrial systems. This includes a federal system and a system for each of the states, except for Victoria. Victoria referred its powers in relation to industrial relations laws to the Commonwealth many years ago.
The key legislation which regulates the Federal workplace relations system is the Workplace Relations Act 1996 (Cth) (“WRA”) and the Fair Work Act 2009 (FWA). Key components of the FWA commenced on 1 July 2009 and will ultimately replace the WRA over time.
Following the Work Choices amendments to the WRA, which took effect on 27 March 2006, the majority of Australian workplaces are now the subject of the federal industrial system.
Which system applies to me? The federal system applies to employers which are: constitutional corporations; the Commonwealth; a Commonwealth authority; or an employer in Victoria or the ACT or Northern Territory. The state systems apply to employers which are sole traders and partnerships.
What is the difference between the Federal and State industrial systems? There are significant differences between the federal and state industrial systems. Just some of those differences are outlined in the table below:
| |
Federal |
State |
| Awards |
Content very limited under this system |
Content broader under this system |
| Agreements |
Only collective agreements available. |
Only collective agreements available. |
| Industrial Disputes |
Fair Work Australia deal with these. |
Industrial Relations Commission arbitrates these |
| Leave |
Prescribes annual leave, personal leave and parental leave. |
Parental leave only.
Annual leave is sourced from separate legislation.
Personal leave sourced from awards |
| Unfair Dismissal |
Eligibility to bring such claims is very limited under this system. |
Eligibility to bring such claims is broader under this system. |
| Unfair Termination |
Remedy available under this system. |
This is not a remedy available under this system. |
| Wages |
Currently determined by the Fair Pay Commission. From July 2010 this will be determined by Fair Work Australia. |
Set by Industrial Relations Commission. |
AWARD COMPLIANCE
How do I find out if an award applies? It will be a rare workplace that does not have at least one worker whose employment is the subject of an award. There are a number of ways in which you can find out if an award applies: by seeking the assistance of the relevant government department (see our Links page); by seeking advice from an employer association or union; or by seeking advice from a solicitor specialising in workplace law and industrial relations (such as Devine Law at Work).
How can I access a copy of an award? Most awards are available online. See our Links page.
BULLYING & HARASSMENT
What is bullying? While there is nothing new about bullying, a specific legal definition of bullying has not yet been devised. There is no specific law which prohibits bullying – nevertheless it is prohibited under a range of laws indirectly.
In the workplace context, bullying is generally understood to mean repeated behaviour which can threaten, distress, humiliate or otherwise victimise the subject of the bullying.
Examples of what may constitute workplace bullying include: verbal abuse; put-downs and insults; teasing; unreasonable or inappropriate criticism; threats and intimidation; exclusion - by other employees or from training and other work opportunities; unreasonable demands on work performance (e.g. unreasonable deadlines); too much work or too little work; giving an employee work that it is demeaning (having regard to their relative seniority and skills); giving an employee work that is beyond their skills and experience; changing work rosters deliberately to inconvenience or cause hardship to an employee; too much supervision; withholding support or information from employees which prevents them from performing adequately.
Bullying does not include: reasonable and lawful directions given by a business owner/manager to an employee; performance appraisal which is conducted on an objective basis; disciplinary procedure which are conducted in a fair and objective manner; disciplinary action which is taken following objective assessment and a fair procedure; a single incident – subject to the specific circumstances of the case.
The important matters to keep in mind are: employers are entitled to give lawful directions;
employees are obliged to comply with lawful directions; whether or not conduct amounts to bullying will depend on the circumstances.
What is harassment? In broad terms, workplace harassment is a term which refers to all forms of conduct within a workplace which humiliates, offends or intimidates. This includes bullying, sexual harassment and other behaviours.
From a practical perspective, the laws which prohibit workplace harassment rest on the following simple principles: that all workers are entitled to attend work without being subject to risks to their health, safety or welfare; that all workers are entitled to attend work without being subject to unwanted and unwelcome conduct towards them personally or within the work environment. In other words, workers should be free to come to work and get on with their work without unnecessary or damaging interference.
What is sexual harassment? Sexual harassment is prohibited under both the Sex Discrimination Act 1984 (Cth) (“SDA”) and the Anti-Discrimination Act 1977 (NSW) (“ADA”).
The essential elements of sexual harassment are: the behaviour must be unwelcome; it must be of a sexual nature; and the person harassed must feel offended, humiliated or intimidated and it is reasonable in the circumstances that they react this way.
Whether the behaviour is unwelcome is a subjective question and will depend on the response of the particular individual alleging sexual harassment. The harasser’s motives are not relevant in determining whether their behaviour is unwelcome. The reasonableness of the response of the person allegedly being harassed is determined objectively. It is irrelevant that the behaviour may not offend others or has been an accepted feature of the workplace.
The following conduct may constitute sexual harassment: offensive letters, faxes, telephone messages or email messages; displaying pornographic posters, cartoons or calendars; sexual propositions or gestures; physical contact of a sexual nature; sexually related language or jokes; gender based insults; unwanted invitations; attempts at sexual intercourse or some other overt sexual connection; kissing, touching or pinching.
Other actions which may amount to sexual harassment include: intrusive questions at an employment interview; unwelcome remarks or insinuations about a person’s sex life or personal life; suggestive comments about a person’s appearance or body; sexually explicit conversations; proposals of marriage; declarations of love; and offensive telephone calls.
There will often need to be some indication by the person allegedly being harassed that the conduct of the harasser is unwelcome. However, a complaint of sexual harassment will not fail to be substantiated just because a person being harassed did not directly inform the harasser that their conduct was unwelcome.
Sexual harassment may be ongoing conduct or a single incident.
Sexual interaction or flirtation which is based on mutual attraction or friendship is not sexual harassment because it is not unwelcome. If the behaviour is invited, consensual or reciprocated it is not unlawful.
How does bullying or other harassment arise within the workplace? Workplace harassment may take place between any people working in or having contact with the workplace, including: business owners; directors; managers and supervisors; co-workers;
clients and customers; suppliers; and, visitors to the workplace.
Workplace harassment may arise as a result of the conduct of a single individual or a group or as a consequence of the workplace culture and work environment.
To amount to workplace harassment, the harassment will ordinarily need to arise within the workplace. However there may be circumstances in which conduct outside the workplace will amount to workplace harassment – particularly in circumstances where there is a direct link between the parties to the harassment and the workplace. For example, where but for the working relationship of the parties to the harassment there would be no contact between them.
What can a worker do if s/he is being bullied or harassed? Bullying or other harassment by an employer represents a breach of the employment contract and can give rise to several different remedies. Where a worker bullies or otherwise harasses another worker, his/her conduct can amount to a breach of his/her employment contract and give rise to disciplinary action. In most circumstances the employer of the bully/harasser will be vicariously liable for the conduct of the bully/harasser.
An employee who believes that s/he is the subject of bullying/harassment has a range of options. In the first instance, this includes either attempting to resolve the matter directly (e.g. by telling the bully/harasser to stop their conduct) or seeking the assistance of his/her employer (e.g. by lodging an internal complaint). Other options include: seeking advice from a solicitor/union; lodging an external complaint (e.g. with the Human Rights and Equal Opportunity – see our Links page); or resigning (if the situation becomes intolerable) and lodging an unfair dismissal claim (subject to meeting eligibility requirements).
DISCRIMINATION
What is discrimination? Discrimination refers to the act of making a distinction between two or more people or things. Unlawful discrimination refers to an act of: making a distinction; based on a particular characteristic a person has or is thought to have; which leads to less favourable treatment of that person; than in the same circumstances, or in circumstances which are not materially different, a person without that characteristic would receive.
Unlawful discrimination may be either direct or indirect in nature. Both forms are prohibited.
What laws prohibit discrimination? Both federal and state laws prohibit certain types of discrimination.
The key federal legislation is:
- Age Discrimination Act 2004 (Cth);
- Disability Discrimination Act 1992 (Cth);
- Human Rights and Equal Employment Opportunity Commission Act 1986 (Cth);
- Racial Discrimination Act 1975 (Cth);
- Sex Discrimination Act 1984 (Cth);
The key NSW legislation is the Anti-Discrimination Act 1977 (NSW).
All of this legislation can be accessed online at www.austlii.edu.au.
What types of discrimination are prohibited? The grounds of discrimination which are prohibited under federal and NSW anti-discrimination legislation:
sex – including sexual harassment, pregnancy, family responsibilities and marital status of the aggrieved person or the sex of a relative or associate of the aggrieved person;
race – including colour, descent or national or ethnic origin of the aggrieved person concerned or the race of a relative or associate of the aggrieved person;
disability – which includes past, future and presumed disability and discrimination because of the disability of a relative or associate of the aggrieved person;
age – which includes a prohibition against compulsory retirement from employment on the ground of age and discrimination because of the age of a relative or associate of the aggrieved person;
homosexuality – including discrimination because of the homosexuality of a relative or associate of the aggrieved person;
transgender – including discrimination because of the homosexuality of a relative or associate of the aggrieved person.
What is direct and indirect discrimination? Direct discrimination involves a situation where person A discriminates against person B because of a characteristic of person B (eg. a physical disability they have or are presumed to have) whereas indirect discrimination involves a situation where person B cannot comply with a requirement or condition imposed generally by person A because of a characteristic (eg. a physical disability) they have. To meet the test, the condition or requirement must be one which a substantially higher proportion of people without person B’s characteristic can comply with and the requirement or condition must not be reasonable.
How are claims made? Claims made under federal legislation are made to the Human Rights and Equal Opportunity Commission: www.hreoc.gov.au. Claims made under NSW legislation are made to the Anti-Discrimination Board: www.adb.nsw.gov.au.
Where the grounds of unlawful discrimination are common to both federal and state legislation (e.g. sex, race, disability and age) claims may be made either to HREOC or to the state anti-discrimination body.
Where the grounds of unlawful discrimination are not common to federal and state legislation (e.g. transgender status and sexual preference under NSW legislation) the claim may only be made to the anti-discrimination body which administers the particular legislation under which that ground or grounds is prohibited.
What does the process involve? Complaints/claims are the subject of a preliminary assessment by anti-discrimination body to which they are submitted. If the body finds on the basis of the preliminary assessment that the claim relates to matters for which the body has jurisdiction, the processing of the claim will commence. In the first instance the body will seek the employer’s response.
EMPLOYMENT CONTRACT
What is an employment contract? The employment contract consists of three key elements: the common law; legislation; and industrial instruments.
What makes an employment contract valid? For any contract to be valid and therefore enforceable there need to be five essential ingredients: the intention to create a legal relationship; offer by one party and acceptance by the other; valuable consideration (i.e. something of value – often the payment of money); legal capacity to make the contract; genuine consent to the terms of the contract; and content which is not contrary to law or public policy.
Can I make changes to an employment contract? Yes you can. Employment contracts are rarely if ever static. As the circumstances in which the contract operates it is appropriate for the contract itself to change. Contracts should be reviewed on a regular basis to ensure that they reflect and the meet the needs of changing circumstances.
How do I make changes to the employment contract? The same rules which applied when the contract was originally made apply when changes are proposed. This means that when circumstances change either party to the contract may offer to vary the contract and the other party can consider whether or not to accept the offer. Any variation will only be enforceable where there is genuine consent. For there to be genuine consent the party being offered the variation must fully understand what is being proposed and what its effect is and not be placed under any duress to accept the variation. That said, if the variation is not accepted and the party offering it is unwilling to continue the relationship on the existing terms, it is open to the offering party to give notice of the termination of the contract. Making this clear to the party to whom the offer is being made needs to be handled carefully to avoid any suggestion of duress.
When an employer decides to terminate the contract because a variation that they have proposed has not been accepted by an employer, they will need to keep in mind any applicable laws and contractual terms. These may include but are not limited to unfair dismissal laws, redundancy provisions (in applicable awards and/or contractual provisions) and what is reasonable notice in the circumstances.
When offering a variation to the contract, an employer needs to ensure that the employee understands that s/he can accept or reject the offer and the consequences of each decision. This way a decision can be made on an informed basis.
If the variation is accepted, it should be documented with both parties receiving a copy of the document.
Do policies and procedures form part of the employment contract? If an employer expects the employee to comply with the employer’s policies and procedures then these policies and procedures form part of the employment contract. If in those policies and procedures the employer promises to do X or Y then those promises will form part of the employment contract.
Can I have a probationary period in the contract? If the employee is a permanent employee and the contract is open-ended (i.e. not for a fixed term) then you can include a probationary clause. It is often a good idea to include a probationary clause as it will usually enable either party to the contract to bring the contract to an end if things do not work out. An employee who is the subject of a probationary or qualifying period will not usually be entitled to make an unfair dismissal claim, subject to the length of that probationary/qualifying period.
Can I have a non-compete clause in the contract? Yes you can. These clauses are most appropriate when the employee has special skills and/or special access to sensitive and other confidential information. They will only be enforceable if they are very well drafted (a one size fits all approach is not recommended) and reasonable in the circumstances.
Are non-compete clauses enforceable? If they are well drafted and reasonable in the circumstances then they will be enforceable.
Is there any term I can’t include in an employment contract? Contracts are the products of negotiation. Provided that the contract does not include a provision requiring a party to break the law, then any clause can be included. Any clause which conflicts with the law will not be enforceable.
EMPLOYMENT STATUS
What is an employee? An employee is a person who is the subject of a contract of service. In broad terms this means that the person works under the direction of the employer. An employee may work on a permanent or casual basis. A permanent employee may work on a full-time or part-time basis. An employee may be an award employee or a non-award (also known as a common law) employee. An award employee is a person whose employment is the subject of a Federal or State award.
What is an independent contractor? At law an independent contractor is meant to be quite a different quite of worker from an employee. An independent contractor will ordinarily: have their own Australian Business Number; be able to determine when they perform the work; be able to determine how they perform the work; not have to perform the work in the engaging entity’s workplace; invoice the engaging entity for his/her/its services; be responsible for his/her/its own insurance, superannuation and tax; not be required to wear a uniform. An independent contractor may be an individual, however an independent contractor may also be a partnership or a corporation.
What is a casual employee? A casual employee is ordinarily a person who is engaged on an irregular and short term basis. For the purposes of unfair dismissal law, a casual is a person who is employed on a regular and systematic basis for a “short period” – being a period of either six months (in the case of NSW industrial law) or 12 months (in the case Federal industrial law).
What is a part-time employee? A part-time employee is a person who works on specified days and for regular hours of less than 38 hours per week.
Can the employment status of a worker be changed? Yes the employment status of a worker can be changed.
How can the employment status of a worker be changed? As with any other term of an employment contract, the employment status of a worker can only be changed through negotiation. If and when agreement is reached, the agreement needs to be documented.
ILL AND INJURED EMPLOYEES
What laws do I need to keep in mind with an ill or injured employee? A broad range of laws need to be kept in mind when managing an ill or injured employee. This includes: occupational health and safety law; anti-discrimination law; the unlawful termination provisions of industrial relations law (in particular the prohibition against terminating an employee the subject of a temporary absence and the prohibition against dismissing a person on the ground of disability). In addition to these laws, which apply to all ill and injured workers, where the illness or injury is work related, the protection of injured employees provisions of state workers compensation laws must also be kept in mind.
Occupational health and safety law and anti-discrimination law seem to be in conflict. Which one should I be complying with?
It is a common misconception that occupational health and safety law and anti-discrimination law operate in conflict with one another. It is our view however that these laws do not operate in conflict, though compliance with them can be a complex process. It is necessary however for employers and employees to understand what these laws mean in practice for their workplace. Through such understanding employers and employees can get better results and ensure compliance with these laws. We recommend you seek our advice about your specific situation.
Can I do anything about an employee who has been absent from work for an extended period for an illness or injury which is not work related? Yes you can. A fundamental term of most employment contracts is the requirement to attend work. A long term inability to attend work inevitably raises the question of whether or not the employee can meet his/her obligations under the employment contract.
Before taking any action, employers need to be aware of the range of laws which they must comply with when managing ill and injured workers. Under federal industrial law (which applies to all constitutional corporations) employers are prohibited from terminating any employee who is the subject of a temporary absence – this is a 3 month period (either in one or a series of periods) within a 12 month period. Further, all employers are prohibited from dismissing an employee on the ground of his/her disability (whether physical or psychological in nature), unless the employer can demonstrate that the employee was unable to perform the inherent requirements of the position even if reasonable accommodation was made for the employee’s disability or disabilities by the employer. Further, under NSW workers compensation legislation, all employers with employees in NSW are prohibited from terminating the employment of an employee with a work related injury within six months of the date of the injury.
So the starting point is that no ill or injured employee should be dismissed earlier than three months from the date of illness/injury arising. Further, no employee with a work related injury should be dismissed earlier than six months from the date of illness/injury arising.
When an employee is absent for an extended period, it is reasonable for an employer to seek information about the prognosis for the condition the employee is suffering from and seek details about whether or not s/he will again be able to perform the inherent requirements of the job in the near future. In such circumstances employers are entitled to direct an employee to obtain such information from his/her treating doctor. Any failure by the employee to comply with that direction may entitle the employee to take disciplinary action against the employee. Employers will need to ensure that they provide the details of the inherent requirement to the employee’s treating doctor.
Action can be taken when an employee is away from the workplace for an extended period. It can be a complex process and we recommend that you seek our advice about your specific situation.
Is it correct that I cannot dismiss an employee within six months of a work related injury? If you are an employer the subject of NSW workers compensation legislation then this is correct. Protection of injured workers provisions which previously appeared in the Industrial Relations Act 1996 (NSW) now appear in the Workers Compensation Act 1987 (NSW). Unlike the Industrial Relations Act 1996 (NSW), the Workers Compensation Act 1987(NSW) applies to all NSW employers – including constitutional corporations.
LEAVE – ANNUAL
Who is entitled to annual leave? All employees (including casuals) are entitled to annual leave.
What is the entitlement to annual leave? This differs depending on what system you are the subject of. Under the federal system, an employee is entitled to accrue annual leave equivalent to 1/13th of the nominal hours worked by him/her each month. For example if a person works 38 hours per week for a month (4.3 weeks) they will work nominal hours of 163.4. the annual leave that employee accrues in that month is 1/13th of those nominal hours, an amount of 12.57 hours.
Under the NSW system, a full time employee is entitled to 20 days annual leave (pro rata for part time employees) for each year of continuous service.
Can annual leave be cashed out? Under current law, the entitlement to cash out a portion of annual leave is limited to employees who are the subject of the federal industrial system (e.g. employees of constitutional corporations). This entitlement is limited to 1/26th of the nominal hours worked by the employee during a 12 month period. An employee will only be entitled to cash out a portion of annual leave if: there is a provision in a workplace agreement which binds the employee and employer entitling the employee to forgo the entitlement to take the annual leave; the employee gives the employer a written election to forgo the amount of leave; and a provision in a workplace agreement binding the employer and employee entitles the employee to receive pay in lieu of the amount of leave at a rate that is no less than the employee’s basic periodic rate of pay.
From 1 January 2010 the annual leave provisions of the Fair Work Act 2009 (FWA) will apply. Under the FWA it will continue to be possible to cash out a portion of an employee’s annual leave entitlement, provided that it is cashed out in accordance with either the terms of a Modern Award, an enterprise agreement or an agreement between an employer and award/agreement free employee. The amount of the entitlement to annual leave which must remain after the proposed cashing out is not less than four weeks leave. For more details of the FWA provisions concerning annual leave see our Fair Work Act – Fact Sheet 1 on ‘National Employment Standards’ available at www.devinelaw.com.au – just follow the link to ‘Legal Info’.
LEAVE – LONG SERVICE
Who is entitled to long service leave? Long service leave is an entitlement under State and Territory legislation. In NSW, all workers are entitled to long service leave after 10 years continuous service. For this purpose, a “worker” is a person who is employed.
What is the entitlement to long service leave? NSW employees are entitled to 2 months paid leave after 10 years continuous service. In respect of each additional 5 years service, the employee is entitled to a further month of paid leave.
When is an employee entitled to pro-rata long service leave? A NSW employee is entitled to be paid pro-rata long service leave, provided that: s/he has completed five years service; his/her services are terminated by the employer for any reason other than the worker’s serious and willful misconduct or by the worker on account of illness, incapacity or domestic and other pressing necessity; or by reason of the death of the worker.
How do I work out my entitlement? The Office of Industrial Relations has a very useful long service leave calculator available on its website: www.industrialrelations.nsw.gov.au
LEAVE - PARENTAL
What is parental leave? Parental leave includes maternity leave, paternity leave, pre-adoption leave and adoption leave.
What is the entitlement to parental leave? Under relevant legislation, parental leave is an entitlement to unpaid leave prior to or following either the birth of a living child (in the case of maternity and paternity leave) or the placement of a child (in the case of adoption leave).
The maximum entitlement to parental leave under relevant legislation is: in the case of ordinary maternity leave, long paternity leave and long adoption leave - 52 weeks unpaid leave; in the case of special maternity leave – the period the subject of the medical certificate prior to the birth of the child; in the case of short paternity leave - 7 days unpaid leave; in the case of pre-adoption leave – 2 days unpaid leave; in the case of short adoption leave – 3 weeks unpaid leave.
From 1 January 2010 the parental leave provisions of the Fair Work Act 2009 (FWA) will apply. Under the FWA an employee will be entitled to request an extension of 12 months unpaid parental leave by a further 12 months which employers may only refuse on ‘reasonable business grounds’, a term which is not defined. This means that employers need to consider each request carefully, applying fair and objective criteria.
Who is entitled to parental leave? This differs depending on what system you are the subject of. Under both the federal and state systems, all permanent employees (full time and part time) are entitled to parental leave. Such employees are required to have provided continuous service of at least 12 months length in order to be eligible for parental leave.
Under the federal system only those casuals who meet the definition of “eligible casual employee” are entitled to parental leave – this means a person who has been engaged on a regular and systematic basis for a sequence of periods during a period of at least 12 months and who, but for the birth/placement of a child, would have a reasonable expectation of continued engagement on a regular and systematic basis.
Under the NSW system, all permanent employees are entitled to parental leave. Only those casuals who meet the definition of a “regular casual” are entitled to parental leave – this means a person who has been engaged on a regular and systematic basis.
When may parental leave be taken? Parental leave may not be taken concurrently by each parent of a child, except in the case of short paternity leave and short adoption leave.
Ordinary maternity leave may commence at any time within six weeks before the expected due date of birth of the child. Short paternity leave may commence at any time from the day on which the employee’s spouse begins to give birth. Long paternity leave may be taken at any time within 12 months after the date of birth of the child. Short adoption leave may be taken at any time within the period of three weeks starting on the day of placement of the child. Long adoption leave may be taken at any time within 12 months after the date of placement of the child.
How much notice must an employee give when applying for maternity or paternity leave?
An employee applying for either maternity or paternity leave must supply his/her employer with a medical certificate from a medical practitioner no later than 10 weeks before the expected date of birth. This should be provided to the employee’s immediate Manager.
The medical certificate must contain a statement that the employee (or the employee’s spouse, as the case may be) is pregnant and a statement of the expected date of birth.
The requirement to provide this document no later than 10 weeks before the expected date of birth will not apply in the event of the premature birth of a child or there is a compelling reason for non-compliance with this requirement. In such circumstances, the employee is obliged to provide the document as soon as reasonably practicable. Where the child has already been born, the medical certificate must state the actual date of birth and the expected date of birth as at the 70th day before the actual birth.
An employee applying for ordinary maternity leave or paternity leave must give his/her employer a written application stating the first and last days of the period of leave no later than 4 weeks before the first day of the intended continuous period of leave. This requirement will not apply where the employee is unable to comply because of the premature birth of the child or any other compelling reason.
Any application for a continuous period of ordinary maternity leave must include a period of leave of at least 6 weeks from the date of birth of the child.
Under current law, the application for maternity leave or paternity leave must be accompanied by a statutory declaration made by the employee which states: the first and last days of any period of any other authorised leave (e.g. paid annual leave or long service leave) intended to be taken by the employee because of the employee or the employee’s spouse, as the case may be; the first and last days of any period of maternity or paternity leave taken by the employee’s spouse, as the case may be; that the employee intends to be the child’s primary caregiver at all times when on maternity leave (or paternity leave as the case may be); that the employee will not engage in any conduct which is inconsistent with her/his contract of employment while on maternity/paternity leave. This requirement will not apply to any employee who could not comply due to circumstances beyond her/his control.
On and from 1 January 2009, when the parental leave provisions of the Fair Work Act 2009 will apply, employees will no longer be required to provide a statutory declaration.
Is an employee returning to work from maternity leave entitled to return to the position she held before she commenced maternity leave? An employee returning from maternity leave is entitled to return to: the position she held immediately before she commenced maternity leave; or, if she was promoted or voluntarily transferred to a position during the maternity leave period (other than to a safe job) to the new position; or, if she worked part-time during the pregnancy because of the pregnancy, to the position she held before she started working part-time.
Under federal legislation, if the former position no longer exists and the employee is qualified and able to work for her employer in another position, she is entitled to return to that position or, if there are two or more positions, whichever position is nearest in status and remuneration to the former position.
Under NSW legislation, if the former position no longer exists and the employee is qualified for and is capable of performing, the employee is entitled to be employed in a position as nearly as possible comparable in status and pay to that of the employee’s former position.
LEAVE – PERSONAL
What is personal leave? The term personal leave refers to both sick leave and carer’s leave.
Who is entitled to personal leave? Under the federal system, all permanent employees are entitled to paid and unpaid sick leave and carer’s leave. Casual employees are not entitled to paid or unpaid sick leave or to paid carer’s leave. Casual employees are entitled to unpaid carer’s leave.
Under the NSW system, only award employees have an automatic right to personal leave. This is because this entitlement derives from a test case provision which is inserted into NSW awards. Common law (non-award) employees will only have an entitlement to personal leave if there is a provision to this effect in their letter of offer/formal employment contract.
What is the entitlement to personal leave? This differs depending on what system you are the subject of. Under the federal system, an employee accrues personal leave of 1/26th of the nominal hours he/she works in a month. For example, if an employee works 38 hours per week for a month (4.3) weeks, S/he will work nominal hours of 163.4. S/he will accrue a personal leave entitlement of 1/26th of these nominal hours, an amount of 6.28 hours.
Under the NSW system, award employees will have the entitlement which is set out in the applicable award provision. However, this is usually 5 days personal leave for the first year of service and 8 days for each subsequent year.
Can personal leave be cashed out?Under current law, the entitlement to cash out a portion of personal leave is limited to employees who are the subject of the federal system. An employee will only be entitled to cash out a portion of personal leave if : s/he has more than the protected amount of paid personal leave; there is a provision in a workplace agreement binding the employer and the employee which entitles the employee to forgo an amount of personal leave which is in excess of the protected amount; the employee gives the employer a written election to forgo the amount of paid personal leave; there is a provision in a workplace agreement which binds both the employer and the employee that entitles the employee to receive a payment in lieu of the amount of paid personal leave at a rate which is not less than the employee’s basic periodic rate of pay (expressed as an hourly rate); and the employer authorises the employee to forgo the amount of paid personal leave.
The protected amount of personal leave is 3/52 of the number of nominal hours the employee has worked in a continuous period of 12 months ending before the day on which the employee makes the election. For a full time employee working 38 hours per week, the protected amount of personal leave would be 114 hours, which would equate to 15 days.
From 1 January 2010 the personal leave provisions of the Fair Work Act 2009 (FWA) will apply. Under the FWA the option of cashing out a portion of personal leave will be limited to employees the subject of a Modern Award or enterprise agreement and which contains a provision allowing for cashing out. This means that it will not be possible to cash out personal leave for award/agreement free employees. The amount of the personal leave entitlement which must remain after cashing out (in the case of award/agreement employees) is not less than 15 days.
LIABILITY
Am I liable for the actions of my employees? Yes, in most circumstances an employer will be liable for the actions of their employees. If an employee acts outside their authorisation, then any misconduct by them could result in a fundamental breach of the employment contract. Accordingly employers need to ensure that each employee fully understands what they are and are not permitted to do.
OCCUPATIONAL HEALTH AND SAFETY
What are an employer’s obligations under OH&S law? Under NSW OH&S legislation, employers must ensure the health, safety and welfare at work of all their employees. To meet this obligation, employers must: ensure that premises which they control which their employees work in are safe and without risks to health; ensure that any plant or substance provided for use by employees at work is safe and without risks to health when properly used; ensure that systems of work and the working environment of the employees are safe and without risks to health; provide such information, instruction, training and supervision as may be necessary to ensure the employees’ health and safety at work; provide adequate facilities for the welfare of employees at work; consult with employees to enable employees to contribute to the making of decisions affecting their health, safety and welfare at work; take reasonable care to identify any foreseeable hazard, in particular those arising from the work premises, work practices, work systems and shift working arrangements, plant, hazardous substances, the presence of asbestos, manual handling, layout and condition of a place of work, biological organisms and the physical working environment; ensure that effective procedures are in place and are implemented to identify hazards immediately prior to using premises for the first time, before and during the installation, erection, commissioning or alteration of plant in a place of work, before changes to work practices and systems of work are introduced, before hazardous substances are introduced into a place of work and while work is being carried out and when new or additional information from an authoritative source relevant to the health and safety of the employees of the employer becomes available.
Very substantial penalties can be imposed on employers (whether corporations or individuals) and their directors and managers for breach of obligations under OH&S legislation.
What are an employee’s obligations under OH&S law? Under NSW OH&S legislation, employees must take reasonable care for the health, safety and welfare of people who are at the employee’s place of work and who may be affected by the employee’s acts or omissions at work and must cooperate with his/her employer so far as is necessary to enable compliance with any requirement under OH&S legislation.
Employees who fail to comply with their obligations under the OHS Act can be prosecuted by the government regulator, Workcover. Such a failure could also expose the employee to disciplinary action by the employer, which in a serious case could result in dismissal.
Employees are prohibited from deliberately creating a risk (or the appearance of a risk) to the health and safety of people at work if they do not have a reasonable excuse and if they intend to cause disruption. A breach of this prohibition could expose the employee to the risk of a penalty. It could also expose them to the risk of disciplinary action by the employer.
RECORDKEEPING
What records relating to employees and pay slips do employers have to keep? For details of the records you need to keep, refer to our Fair Work Act 2009 Fact Sheet 7 which is available online at www.devinelaw.com.au – just follow the link to ‘Legal Info’.
RECOVERY OF MONIES OWED
Can I deduct what my employee owes me from his/her termination pay? You will only have a right to do this if you have the employee’s agreement.
How do I recover money owed to me by my employer/employee? You should write to your employer/employee and inform them of the claim you are making and require him/her to pay what is owed to you within a certain time frame. If you are the employer, you may wish to propose a particular method of payment (e.g. instalments). If your employer/employee does not respond, you may need to consider taking legal action. You can make the claim in the Local Court (if the amount claimed is less than $60,000).
REDUNDANCY AND RETRENCHMENT
When is a position redundant? The term “redundancy” refers to a situation in which an employer no longer requires a particular job to be performed by any one. An employee’s position is redundant where the duties that go to make up that position are split up and spread amongst other employees.
A redundancy can arise in any number of situations, including: the closure of a business; the introduction of technological or organisational change; the sale of a business; the outsourcing of the relevant part of the business; privatisation of a government undertaking; and, as part of a business restructure.
What does retrenchment mean? The term “retrenchment” refers to the ground upon which an employer decides to terminate an employee’s employment after the position held by that employee is made redundant and there is either no suitable alternative employment which can be offered or, if there is, it has not been accepted by the employee.
How do I choose whose employment will be terminated? In order to minimise the risk of legal action, employers must ensure that objective criteria are used when selecting whose employment is terminated on the ground of retrenchment. This can include consideration of such matters as: performance; conduct; skills; expertise; other attributes (both positive and negative). If considering attendance records, the employer must be careful to ensure that its decision does not amount to disability discrimination. Employers must also be careful when using criteria such as “last on first off” as this can amount to unlawful discrimination (e.g. age).
The legal action which may arise from the termination of an employee on the ground of retrenchment can include: common law claims (for breach of contract); unfair dismissal claims; unlawful termination claims; and discrimination claims. Accordingly it is in the best interests of an employer to ensure that a proper process of selection and termination is followed.
In what circumstances can an employee be retrenched? Contrary to common belief, termination of an employee’s employment will not automatically follow on from the making redundant of the position by the employee. Instead, the employer must first consider whether or not there is suitable alternative employment which can be offered to the employee. Suitable alternative employment means a position within the Company which is suitable having regard to the employee’s skills and experience and which is at least as beneficial in the terms and conditions applying to it, when taken as a whole, as those applying to the position made redundant. This can include a position for which the employee might reasonably be retrained. If there is no suitable alternative employment, the employment contract can be terminated on the ground of retrenchment provided that the process followed complies with relevant legislation and the terms of the contract.
Will a worker whose employment is terminated on the ground of retrenchment always be entitled to a severance payment? The origin of the legal entitlement to a severance payment in the event that an employee’s employment is terminated on the ground of retrenchment is the Termination Change and Redundancy Case (“TCR”) a test case decided by the Australian Industrial Relations Commission (“the Commission”) in 1989. As a consequence of the two decisions made by the Commission in this case, a standard clause outlining the minimum severance payment to be paid in the event of retrenchment was inserted into all federal and state awards.
An award employee may also have an entitlement to the provision of notice (or payment in lieu of notice) and severance payment in a provision of an applicable enterprise agreement or Australian Workplace Agreement. If they do, this provision will override any award provision relating to redundancy payments.
A non-award employee will not have a direct entitlement to severance payment unless there is either an express term to this effect in their letter of appointment/employment contract or that entitlement is otherwise incorporated into the letter of appointment/employment contract (eg. most commonly in a company policy). This will change from 1 January 2010 onwards. From that date, all employees (including non award employees) will be entitled to severance payments (subject to eligibility criteria) under the relevant National Employment Standard.
TERMINATION OF EMPLOYMENT
Does notice have to be given when terminating an employment contract? An employment contract must be terminated by providing notice, except where there has been a fundamental breach of the contract. The notice which is provided must be both reasonable in the circumstances and comply with the terms of any relevant award, contract and legislation.
Under the Workplace Relations Act 1996 (Cth) (“WRA”), employers must not terminate an employee’s employment unless the employee has been given the required notice or the employee has been paid an amount in lieu of notice. This will continue to be the case when the relevant provision of the Fair Work Act 2009 (Cth) (FWA) takes effect on 1 January 2010.
The minimum amount of notice to be paid under the relevant provisions of the WRA is outlined in the table below:
| Period of Continuous Service |
Period of Notice |
Additional notice if employee is over 45 years old and has completed at least 2 years continuous service |
| Not more than 1 year |
At least 1 week |
1 week |
| More than 1 year but not more than 3 years |
At least 2 weeks |
1 week |
| More than 3 years but not more than 5 years |
At least 3 weeks |
1 week |
| More than 5 years |
At least 4 weeks |
1 week |
In cases where the notice provision in a contract is less than the applicable legislative minimum outlined above, then the employee must be given the minimum notice provided for under the legislation. However, where the amount of notice provided for in the contract is equal to or greater than the legislative minimum, then the notice in the contract is what must be given.
Do I have to give three warnings before I dismiss an employee? No. The belief that three warnings must be given is one of the great myths of workplace law. There is no requirement to provide such a number of warnings, under either statute or case law. However, using warnings can be quite a useful procedure.
Why can’t I just sack an employee if s/he is not working out? If that employee is eligible to make an unfair dismissal claim, then you will be obliged to only fairly dismiss that employee. In broad terms, this means that you will need to have a valid reason for dismissing that employee. The reason for dismissal will not be valid if it breaches a law – e.g. anti-discrimination laws. You will also be obliged to ensure that the employee is the subject of a procedurally fair process – this means that you should: inform the employee at the outset what your expectations are in respect of both performance and conduct; inform the employee when s/he does not meet your expectations and what s/he needs to do to improve and what the consequences may be if s/he does not improve; and give the employee the opportunity to defend him/herself. Where an allegation is made against an employee (e.g. misconduct), then you are obliged as his/her employer to be impartial in your approach and ensure that the allegation is investigated properly.
If the employee is not eligible to make an unfair dismissal claim, then you may be entitled to dismiss the employee without reason, provided that you comply with the requirement to give notice. This notice will arise in all circumstances except those where you can prove that the employee committed a fundamental breach of the employment contract.
If you do not terminate the contract in a manner consistent with the contract, you will be in breach of it and be at risk of legal action as a result. Further, you need to keep in mind other laws – such as the unlawful termination provisions of the Workplace Relations Act 1996 (Cth) which prohibits termination on certain grounds. If a reason is not given, then an employer can be at risk of not being able to defend itself properly if legal action is taken. This will be particularly the case in unlawful termination proceedings, because in such cases the onus is on the employer to prove that the dismissal was not due to a prohibited reason.
The other matter to keep in mind is that hiring and firing is an expensive process. In our experience, using a simple and fair process when dealing with alleged poor performance or misconduct is the best way to give employees the opportunity to improve. Most will make the best of this opportunity. If they do not, then employers will often be entitled to dismiss. We recommend that you obtain advice before dismissing an employee. Better to be safe than sorry!
UNFAIR DISMISSAL – FEDERAL SYSTEM
Who can make an unfair dismissal claim?Not all employees can make an unfair dismissal claim. Those who are not eligible are: those who earn more than the jurisdictional threshold (currently $108,400); those who are the subject of a probationary/qualifying period (of up to six months); casual employees who have worked for a regular and systematic basis for less than 12 months; those who have been dismissed for genuine operational reasons.
The Fair Work Act 2009 (FWA) applies in relation to dismissals on or after 1 July 2009.
What is an unfair dismissal? Under the FWA, a dismissal will be unfair if Fair Work Australia is satisfied that:
- the person has been dismissed; and
- the dismissal was harsh, unjust or unreasonable; and
- the dismissal was not consistent with the Small Business Fair Dismissal Code; and
- the dismissal was not a case of genuine redundancy.
In determining this question, Fair Work Australia has regard to the following matters:
- whether there was a valid reason for the termination related to the employee’s capacity or conduct;
- whether the person was notified of that reason; and
- whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
- any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
- if the dismissal related to unsatisfactory performance by the person - whether the person had been warned about that unsatisfactory performance before the dismissal; and
- the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
- the degree to which dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
- any other matters that Fair Work Australia considers relevant.
If a claim is successful, what orders can be made? When an applicant is successful in their unfair dismissal claim, the Commissioner hearing the matter can make any of the following orders:
reinstatement – to the applicant’s former position on terms not less favourable than prior to the dismissal;
re-employment – if the Commission considers it impracticable to reinstate the applicant to their former position, it may order that the applicant be re-employed in another position by the respondent on terms not less favourable than the position held prior to dismissal;
continuity – an order that continuity of employment be taken not to have been broken, an order which may be made if reinstatement or re-employment is ordered;
remuneration – an order that the applicant be compensated for the period s/he was not employed, an order which can be made if reinstatement or re-employment is ordered compensation – of an amount equivalent of up to 26 weeks' wages.
Can costs be claimed in unfair dismissal proceedings? Unfair dismissal claims are considered to not be a costs jurisdiction. This means that costs will not ordinarily be awarded to the successful party and therefore that each party will usually need to bear their own costs. Nevertheless, a successful party will have an opportunity to make a successful costs application if they can demonstrate any of the following: that the application was made without “reasonable cause”; that the application was frivolous or vexatious; either party unreasonably failed to agree to settle the matter.
UNFAIR DISMISSAL – STATE SYSTEM (NSW)
Who can make an unfair dismissal claim? Not all employees can make an unfair dismissal claim. Those who may be able to make a claim are: any employee who is award free and whose annual remuneration is less than the jurisdictional threshold (currently $108,400); and any employee covered by a NSW State Award or registered agreement; and any public sector employee.
However if any of these categories of employee is: on a three month probationary period at the time of the dismissal (if this probationary period has been determined in advance); or a casual employee for a short period; or the subject of a fixed term contract for a specified period or for a specific task; they will not be entitled to bring such a claim.
What is an “unfair dismissal”? An unfair dismissal is one which the NSW Industrial Relations Commission determines is “unfair, unjust or unreasonable”. This is determined very much on the facts of each case. Key principles involved are “procedural fairness” and “substantive fairness”. Procedural fairness goes to the issue of whether or not a fair procedure was followed in bringing the employment relationship to an end. For example, in the case of a dismissal based on poor performance: whether or not the employee was informed of the concern the employer had regarding his/her performance; whether the employee was given an opportunity to provide a response/explanation; whether that response/explanation was considered by the employer; and whether the employee understood what s/he needed to do to improve. Substantive fairness goes to the issue of whether the decision to terminate was a “punishment that fits the crime”.
Unfair dismissal can include what is known as “constructive dismissal”. This arises where an employee appears to terminate the employment relationship through resignation but the termination is held to have been due to the conduct of the employer. A clear example is where an employer tells an employee “resign or be sacked”, however more subtle circumstances can lead to a finding of constructive dismissal.
If a claim is successful, what orders can be made? When an applicant is successful in their unfair dismissal claim, the Commissioner hearing the matter can make any of the following orders:
reinstatement – to the applicant’s former position on terms not less favourable than prior to the dismissal;
re-employment – if the Commission considers it impracticable to reinstate the applicant to their former position, it may order that the applicant be re-employed in another position by the respondent on terms not less favourable than the position held prior to dismissal;
continuity – an order that continuity of employment be taken not to have been broken, an order which may be made if reinstatement or re-employment is ordered;
remuneration – an order that the applicant be compensated for the period s/he was not employed, an order which can be made if reinstatement or re-employment is ordered compensation – of an amount equivalent of up to 26 weeks' wages.
Can costs be claimed in unfair dismissal proceedings? Unfair dismissal claims are considered to not be a costs jurisdiction. This means that costs will not ordinarily be awarded to the successful party and therefore that each party will usually need to bear their own costs. Nevertheless, a successful party will have an opportunity to make a successful costs application if they can demonstrate any of the following: that the application was made without “reasonable cause”; that the application was frivolous or vexatious; either party unreasonably failed to agree to settle the matter.
WORKERS COMPENSATION
Who has to have a workers compensation policy? All employers operating in NSW are obliged to ensure that they have a current workers compensation policy. A workers compensation policy must be obtained from a licensed insurer and be for a 12 month period. The maximum penalty for failing to have a current and compliant insurance policy is 500 penalty units ($55,000) or imprisonment for six months, or both. Workcover, the regulator of workers compensation law, can also seek to recover double the premium that would have been payable. For larger employers this could be a very considerable amount of money.
Who should be included in the workers compensation policy? All employees and deemed employees should be included in the policy. Those workers who are deemed to be employees for workers compensation purposes include (but are not limited to): workers lent or on hire; outworkers; a contractor who is contracted to perform work which exceeds $10 in value which is not incidental to the trade or business of the contractor and the contractor does not sublet the contract or employ any worker; labour hire workers; certain rural workers; timbergetters; salespersons, canvassers and collectors who are paid wholly or in part by commission and who perform work which is not incidental to the trade or business regularly carried on by the person; tributers; miners; mines rescue personnel; jockeys and harness racing drivers; drivers of hire vehicles; caddies; shearer’s cooks; volunteer fire fighters. All principal contractors should check with Workcover or a solicitor specialising in workplace law whether or not their workers are “deemed” employees for the purpose of workers compensation law.
What is compensated for under a workers compensation policy? A worker is compensated under his/her employer’s workers compensation policy for: a personal injury arising out of or in the course of employment; a disease which was contracted by the worker in the course of employment and to which the employment was a contributing factor; and, the aggravation, acceleration, exacerbation or deterioration of any disease, where the employment was a contributing factor to the aggravation, acceleration, exacerbation or deterioration. It does not include dust diseases, which are the subject of other legislation.
Compensation will only be payable where the employment was a substantial contributing factor to the injury.
Can a worker claim for an injury caused while travelling to or from work? This is what is known as a journey claim. A worker is entitled to claim for compensation for an injury caused while traveling to or from work, provided that: the injury is not attributable to the serious and willful misconduct of the worker; the injury was not received during or after any interruption of or deviation from the journey, unless that interruption/deviation was connected with the worker’s employment or the purpose of the journey and the risk of injury was not materially increased because of the interruption/deviation.
Can a worker claim for stress caused by disciplinary or other actions taken by his/her employer? Provided that the action taken or proposed to be taken by the employer was reasonable, compensation will not be payable.
If I have an ill or injured employee, do I have a choice about claiming on my workers compensation policy? Workers compensation insurance is not like other kinds of insurance, in that there is no choice about whether or not a claim is made. An injured worker is obliged to inform his/her employer as soon as possible after the injury as possible. Once informed, the employer must notify the insurer or Workcover within 48 hours. If the employer notifies the insurer, then it must also inform Workcover in accordance with the procedure outlined in the regulations. If the employer notifies Workcover, then Workcover is obliged to notify the insurer.
Are employers obliged to provide suitable employment for a worker who is fit to return to work but not fit to perform pre-injury duties? Under workers compensation law a worker who has been totally or partially incapacitated and who becomes able to return to work, whether on a full time or part time basis, the employer of that worker must, at the request of the worker, provide suitable employment for the worker.
“Suitable employment” means work for which the employee is suited, having regard to the following matters: the nature of the worker’s incapacity and pre-injury employment; the worker’s age, education, skills and work experience; the worker’s place of residence; the details given in the medical certificate supplied by the worker; the provisions of any injury management plan for the worker; any suitable employment for which the worker has received rehabilitation training; the length of time the worker has been seeking suitable employment; any other relevant circumstances.
The employment must, so far as is reasonably practicable, be the same as or equivalent to the employment in which the worker was at the time of the injury.
The obligation to provide suitable employment does not apply if: it is not reasonably practicable to provide employment; the worker voluntarily left the employment of the employer after the injury happened; or the employer terminated the employment of the worker after the injury and for reasons other than that the worker was not fit for employment as a result of the injury.
Can an employer be prevented from dismissing an injured worker? Yes, if the reason for dismissing the worker is because the worker is not fit to work because of the work related injury and if the proposed dismissal is to take place within six months of the work related injury. The maximum penalty for this offence is 100 penalty units ($11,000).
However, the employer will not be guilty of an offence if an employer: can demonstrate that at the time of the dismissal the worker would not undergo a medical examination reasonably required to determine fitness for employment; or at the time of the dismissal the employer believed on reasonable grounds that the worker had not suffered a work related injury.
A worker who has been dismissed because s/he is not fit for employment as a result of a work related injury, may apply to the employer for reinstatement. If the employer rejects the application, the worker may apply to the NSW Industrial Relations Commission to be reinstated provided that this application is made within two years of the injury and provided that s/he can demonstrate that s/he is fit to return to work of the same or similar nature to the work s/he performed prior to the workplace injury. This remedy is available to all employees in NSW including those employed by constitutional corporations, following amendments to the WCA which commenced in March 2007. The Work Choices amendments to the WRA, which commenced in March 2006, overrode state industrial legislation but did not override state workers compensation legislation. As a consequence a constitutional corporation may still find itself the subject of proceedings for reinstatement before the NSW Industrial Relations Commission.
How do I get a workers compensation policy? A list of the insurance companies which provide workers compensation insurance policies appears on Workcover’s website. Refer to our Links page.
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