People Smartz Blog

Australia's new Modern Award system is now nearly 3 months old.  In that time, I have been dealing with small to medium sized businesses, assisting them in ensuring they are meeting the requirements of the awards and the National Employment Standards.

One of the comments that keeps coming up revolves around which award covers a particular business.

Now, this is really not surprising - there has not been a strong education process for small to medium sized business about the changes and most are not experts in industrial relations or reading awards.

Without going into great detail, some of the changes effecting small to medium sized businesses include:

• The introduction of modern awards
• The introduction of National Employment Standards
• The move for most from state based to national based awards.

The introduction of Modern Awards has involved major changes for small and medium sized businesses.  The process of introduction begun with a "modernisation" process which saw over 1200 awards reduced to approximately 120.

This process of modernisation has resulted in some broad classifications of employment, which for some business people is hard to understand.  Once again, with such a large change, this is not surprising - the move to "modernise" awards has led to Modern Awards with very broad coverage and classifications need to  be generic enough to allow this.

As an example of this, I was recently working with a business which found it difficult to actually identify the award their employees could be classified under.  Going by the classification themselves, it was a difficult exercise, with none in the most obvious award (the General Retail Industry Award 2010) really fitting.

We were able to step our way through a process of identifying the appropriate award and classification, finally ensuring that their employees were employed under the appropriate award.  This has allowed them to identify the changes they will need to make over the coming period as the transitional arrangements take affect.

To assist business people to identify their awards I am conducting a free webinar next Tuesday (30 March) at 1pm (Brisbane Time).  Titled "Modern Awards and Your Business", the webinar will cover areas like identifying award coverage for your business and other practical areas.

If you would like to reserve your seat on the webinar - click on the following link:

https://www1.gotomeeting.com/register/675812345

Over the last two months, we have seen a huge increase in businesses requesting we conduct our free compliance check on their business.

The reason for this is the implementation of the new Modern Awards and the National Employment Standards.  We are now seeing the effect of these new awards and standards on business and the additional burdens they involve.

Our experience with these reviews has enabled us to identify the 5 most common things we are seeing that businesses need to change because of the new laws.

Here they are (in no particular order):

1.  Expectations of 40 hour working week - a 40 hour working week is not in accordance with the National Employment Standards.  These standards set the maximum number of hours at 38 hours.  Now there are ways businesses can continue to use a 40 hour working week providing their employees are better off overall.  But these need to be agreed in writing through either individual flexibility agreements or a collective agreement.
2.  Ordinary working hours not in accordance with the new Modern Award - the new awards may include a change to the hours used to define ordinary working hours.  This means that from 1 July 2010, overtime or penalties may kick in at new times when compared to other agreements. These are subject to transition arrangements, but businesses need to be aware of the potential of extra cost here.  Once again these may be changed by individual flexibility agreements etc.
3.  Businesses still utilising State Awards - All Australian States (except W.A) have referred their powers for industrial relations to the Federal Government.  This means that, except for state government employees, the vast majority of employers previously on a state award are now covered by new modern award.  Businesses need to be aware and compliant with the appropriate award.
4.  Lack of awareness of National Employment Standards - the National Employment Standards lay down the minimum standards of employment for all employees.  By not being aware of the changes between the standards and their current practices, employers run the risk of being in breach of the standards.  A couple of the most common things we are seeing are an unawareness of new work flexibility requirements and the altered termination and redundancy requirements.
5.  Thinking they can ignore the changes - this is just not a smart business move, but a number of businesses are electing this option.  I recommend if you are considering this, you visit the Fair Work Ombudsman website and read the press releases concerning the breaches they have identified and taken action against.

Should you be concerned about your business, or you want to check to made sure your doing things right -  book yourself in for one of our compliance reviews today!

In a world first, People Smartz, as part of the HR Coach Network, is pleased to announce the release of the first national human resource standard, Human Resource Framework NS HRF-101: 2010.

The first national human resource standard was developed by representatives of industry across Australia, New Zealand and Asia Pacific to provide the consistency and security in human resource practices that organisations now need. Based on four years of research by the HR Coach Research Institute, the standard is designed to suit the full array of organisations – profit, not-for-profit, government, private, large and small. Importantly, the standard is there to provide guidance to organisations. It is a voluntary standard to help organisations meet their obligations as well as to develop their employees to optimise their goals.

For organisations without a structured internal human resource function, the Human Resource Framework  provides a simple and consistent method of managing people on an annual basis. The framework provides a guide to good human resource disciplines within the organisation, much the same as an accounting process. 

To learn more about the new National Standard, download the White Paper Setting the Standard from our website

Happy New Year!

Listening to the news last night here in Brisbane, the reports were on many new laws/changes being introduced in the new year.  Bus Fares were going up, politicians were going to be paid more etc.

But there was not one mention of some of the most wide spread changes to the working lives of Australians.  Effective today, Australia's new system of modern awards and the National Employment Standards (NES) will now govern the way businesses employ and manage their staff.

Over the past 6-8 months, I (and many others) have been seeking to raise awareness of these changes and urging businesses to prepare.

Today, the time for preparation is over - from today it is time to act......

If you haven't already identified your new award, it is time to do it.

If you haven't looked at the New Employment Standards (NES), it is time to do it.

If you haven't already identified the changes to your employment practices that will need to be made, it is time to do it.

If you haven't already put in place policies and procedures to protect your business, it is time to do it.

If you haven't already ensured your employment agreements are consistent with the new laws, awards and standards, it is time to do it.

If you haven't got appropriate processes in place to mitigate risk in areas such as harassment, discrimination, Health and Safety etc, it is time to do it.

If you haven't got a engagement plan for the unions relevant to your business, it is time to do it.

If you haven't got a plan for "good faith bargaining" and consulting with your staff, it is time to do it.

If you haven't looked into how to introduce flexibility into your business through "individual flexibility agreements", it is time to do it.

Not a bad list is it?  And this is only the start! 

For more information, visit the members section of our website today!

End of year/Christmas Office parties - a great time to unwind, rub shoulders with workmates and other great antics.  They can be a fun time!

But end of year parties have a very serious side as many of these antics lead to "regrets" after.

Recent research in Australia found that 70% of people believed that hitting the booze led to a more "personal" feeling amongst staff.  Nearly a quarter of females interviewed admitted that their boss had made a pass at them at an office party.

Such behaviours can present many problems for businesses, particularly if the "antics" involved lead to a complaint from a member of staff regarding the behaviour of another.

It would be easy to say "no office party" or "its too risky", but sometimes the advantages of holding the party far outweigh the negatives.  The decision to have or not have one is one for the business alone. 

I would recommend a level headed approach to this years Xmas party - making sure the party is well planned and your staff are aware of the required behaviours before hand.  This way you can have the fun while managing the risk!

To help you plan for your businesses party, download our Christmas Checklist today from our members section.

Only 37 days to go until Modern Awards and the National Employment Standards take effect, use this time Now!

In 37 days, Modern Awards and the National Employment Standards will begin governing the working relationships of nearly all Australians.  Recent legislation passed by state parliaments will see the Federal System of awards covering all private businesses in Australia for the first time. This is a significant step forward in Australian Industrial Relations.  For the first time ever, we will be coming close to having a national system governing employment relationships.

At People Smartz we are working with many businesses getting ready for the changes.  For many, the changes are small, for others significant.  With the Fair Work Ombudsman releasing media statements daily regarding the investigation of small businesses for underpayments or breaches of the legislation, it certainly pays to ensure you are ready! (I invite you to visit the FWA website www.fwa.gov.au to see their press releases - some of the numbers are impressive!) 

As an example - one change that we often see with our clients relates to working hours.  There is exposure to real risk as some businesses have been working a 40 hour week, and the law puts in place a maximum 38 hour week. 

We therefore recommend you look carefully at your business now.  Some questions to ask yourself are: 

• How will the Modern Awards affect my business?
• Are my contracts (employment agreements) up to date and consistent with the new laws?
• Do my employment arrangements cover the 10 National Employment Standards
• Do I have position descriptions?  Do they fit in with the Modern Award?
• Do we have a strong performance management system in place?

On the People Smartz website we have available for download an information sheet on the new laws.  Our Forum area is also available for you to ask questions and seek advice for your business. 

In addition, we have a number of services, such as our Free Compliance Review which you can take advantage of to assess your business.

The important thing is not to leave this until 1 January - check your business now! 

This morning I attended a "healing" breakfast at my son's school.

The breakfast was to remember the storm that hit our suburb, The Gap, one year ago today.

It is hard not to remember this storm.  The scars of it resonate around our suburb still.  A recent newspaper article stated a significant number of children are still receiving post-traumatic stress counseling as a result of the storm.  Many houses are still being rebuilt and repaired and the people refer to life "before" and "after" the storm.

We were not expecting what was to come, the day had been hot and clear.  When I first saw the storm I remember thinking it was just "wrong".  Everything about it was "wrong" - it came from the wrong direction, it was the wrong shape, it was the wrong colour - it was just "wrong".

When it hit, it hit with a ferocity I can not recall seeing before.  Having spent 21 years in the Navy, I have experienced many storms and on one or two occasions been very scared.  This storm was worse than any of those I had experienced before.

Many of you will have seen the Energex advertisements on TV - those are shots of The Gap on this day last year.  The wind howled and swirled and the rain came down in a sheet cutting off visibility to less than a foot or so. A river of water came through our house flooding half of it.  Power was cut off and branches were falling off trees everywhere.

But my family, and the general area we live in, were lucky.  Further into The Gap and in some neighbouring suburbs, the devastation was incredible.  Whole houses destroyed, roofs torn off, houses flooded, schools and churches wrecked, mudslides and trees down everywhere.

I heard many stories that week from friends and acquaintances about their experience during the storm.  One friend of ours spent the night huddled in her second story as a wall of water the height of her ceiling ran through the house below her (her house is still under repair today).  Stories of people having trees fall into the next room are everywhere and there is the story of the church group listening to a concert watching the storm rip off the roof above the pulpit as the storm hit.

The clean up took months.  A terrific community spirit kicked in, people helping each other and digging in to make sure things got back on track. The early days were made difficult by a lack of power, blocked roads and the need to boil drinking water but slowly things begun to happen.  Emergency Services personnel were everywhere and amazing.   

My two boys school, Hilder Rd State School, was unusable for several weeks, every room was flooded and equipment wrecked.  The whole school was bused around to other schools in the area for weeks and repairs to the school have still been continuing throughout this year.  It has been amazing to see the resilience and acceptance of the children to having no play equipment, computers or other resources while the these things were rebuilt and replaced.  Recently, it was announced that the school was in the Top 5 in Queensland in the National NAPLAN tests - not bad for a school that was practically destroyed 12 months ago!  It is hard to figure out who to congratulate first - the Teachers, the Parents or the Kids!

Most people outside The Gap have forgotten that we were actually hit by two storms that week.  Three nights later we were hit by another torrent of water from the sky.  It again flooded many homes and caused some major mudslides in areas already coping with damage.  It was an event not needed by many residents!

Today, The Gap appears to have returned to normal.  Its normal tree dominated, green environment surrounded by Taylor Range and Mt Cootha has returned.  It is truly a beautiful part of Brisbane.  

I believe, that in most circumstances, some good comes out of everything.  In the case of The Gap, I believe this traumatic experience brought a suburb closer together and I think this is a thing we should all be grateful for.  It also taught us the importance of being ready for storms, of ensuring your house is protected and, most importantly, the importance of family, friends and neighbours.

People Smartz is proud to have been accredited as an approved consultant for the Jobs Assist Program.

The Queensland State Government is providing grants through approved Consultants for the delivery of advisory and mentoring services to businesses with 10 or more (full time equivalent) employees under the Jobs Assist programme.

The Department of Employment, Economic Development & Innovations (DEEDI) is providing the support intended to help businesses weather the current economic conditions. The financial loss and consequent unemployment caused by business failures is well understood. DEEDI is generously providing funding wherever such assistance is beneficial to sustaining businesses and the retention of employees.

To find out more about eligibility or to apply please contact us for more information today!

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The HR Coach Research Institute has released its latest quarterly research into employment confidence in the business sector.

The research indicates that positive signs are beginning to enter into the minds of business owners and preparations are being made for an economic recovery. Because of this there is a focus on short term business improvement strategies in readiness for the growth. 

The following is quoted from the results of the research:

"The Institute has identified that in anticipation of an economic rebound, businesses are moving into preparation mode.

The top 3 critical issues facing business have remained the same over the past year – Lack of Work or Sales, Cash-Flow and the Economic Climate.

With an improving expectation of growth in sales and profitability, businesses are looking to resource this trend with increased participation of employees as well as the recruitment of new employees. Concern in relation to finding and keeping talent could see an increase in wages bills – both through an increase in hours of part time employees, and rates of pay for full time employees. This may address the labour underutilization rates that have increased in the past year.

With a low expectation of investment in capital expenditure, businesses are maintaining a short term view in relation to return on investment strategies. This will drive business improvement strategies; building on core business rather than innovation.

As internal organisational confidence continues to decline, businesses will need to focus on internal processes. Businesses will most likely be addressing orientations, workplace and legislative policies in the coming months. This may trigger a resurgence of quality management systems in the market."

The full report on this research is available from the People Smartz Members area. To download - click on the link below:

HR Quarterly Index - October 2009

Laws regarding the use of Independent Contractors have been around for quite a few years now.  These laws are designed to provide increased protection against employers who try and avoid their employment obligations by using what are called "Sham" agreements.

Independent contractors run their own business and should be free to negotiate their fees and working arrangements.  They may provide their services to any number of clients.

Employees have set minimum entitlements (payment of wages, annual leave, personal leave etc) and are subject to the control and direction of their employer.

A "sham" agreement occurs when an employer deliberately disguises an employment relationship as an independent contracting arrangement in order to avoid paying an employee his or her entitlements.  It is possible that an employer who makes arrangements in this way could be fined up to $33,000. 

Many businesses I work with enter into independent contractors agreements in order to "benefit" both the business and the person doing the work. There is no intention to deceive or avoid obligations - just an intention to "do the right thing by all" by improving the return to the "employee" and to save the company money.

Unfortunately, this could be opening up a minefield for the business and the independent contractor.  If the arrangement has been made with the intention of avoiding obligations on the businesses part, it can result in fines, back taxes and other costly penalties.  There can also be tax ramifications for the independent contractor.

When reviewing whether the working relationship is one of employment or independent contract, the Fair Work Ombudsman will look at the circumstances.  Things such as how the work is performed, who bears the commercial risk, whether the work is results based or not, who sets the hours of work, whether the individual has a right to delegate work and who provides the equipment used are some of the many factors which can be taken into account.

I strongly recommend to my clients before entering into independent contractors arrangements that they closely review the relationship they are forming.  While the benefits of utilising independent contractors are significant, if not structured properly, they also introduce an element of risk to the business.

People Smartz is able to assist businesses with the process of employing independent contractors.  If you have, or are considering, independent contractors in your business - contact us today.

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