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!

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! 

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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The Australian Industrial Relations Commission has been releasing over the last couple of months the new Modern Awards to cover employment within Australia from 1 January 2010 .

The process is continuing and by the time January 1 comes along, all employees under $108,000 per annum will be covered by one of the new modern awards.  This includes professional occupations who previously had not been covered by an award - some of them under a new "catch-all" award created for the purpose of ensuring they are covered.

While not all the awards have been released, a list of the one's released so far (with a copy available for download) is available from http://www.airc.gov.au/awardmod/fullbench/awards.htm

I would strongly recommend that you review this list and download the award applicable to your industry.  From 1 January 2010, when the awards become effective, you will be required to be complying with the award applicable to your business.  The time to start preparing is now not on 31 December!

The businesses I am working with on preparing for the new awards vary in the amount of work they need to do to prepare for the changes.  It really does depend on the individual business.....

If you want to know more, as well as a suggested list of activities you can undertake to help yourself prepare for the changes - visit out website by clicking below and downloading our information sheet.

Australia's New IR Laws - Information Sheet

If you have any questions about the changes, please feel free to contact us or post a question on our forum page!  Our forum is also hosting a discussion on what effects you believe the new laws are going to have on your business - why not give us your thoughts today!

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The People Smartz Forum

So why do I need a business coach? Why do I need a HR Coach?  Why do I need a coach at all?

These questions are fired at me fairly regularly and I would like to take the time today to explain why!

First - Coaching is not consulting. Consulting implies that you identify a problem that a client has and you propose a solution. Coaching is more about assisting your to help yourself.

There are many other reasons for working with a business coach, but here are just a few:

1. Working with a coach is an investment in you and your business.  Your business is about your future and you need to have your time and energy concentrated on the important areas of growing your business.
2. The purpose of working with a coach is to guide and encourage you to achieve your goals. A coach will insist on excellence and guide you towards the desired outcomes through the development of a well structured and tailor made business plan. 
3. A coach will help you identify the areas of waste in your business, where your time is being used ineffectively and assist you in correcting these areas.
4. A good coach will have experience in identifying the right people for your team.  The individual's fit into the team is as important as their technical skills.
5. Your coach will look to assist you in developing your sales funnel through targeted sales and marketing processes and activities.
6. Because coaching is not consulting it is more cost effective by building the internal resources within your company.

There are many coaches out there with their own specialities.  Some concentrate on sales, others on marketing, others on strategic direction.  The choices is yours about which is the most suitable for your business.

People Smartz believes that regardless of the specialty area, it is the people involved that produce the results.  This is why our coaching is designed to identify the ways your business can achieve success through people. With People Smartz Coaching you are investing in you and your team - not a process.

For more information - contact us today.

> Learn more about People Smartz Coaching Programs 

One little known part of Australia's new industrial relations laws is the BOOT. No, this is not way to get rid of troublesome employees by using your Size 9's (or whatever size boots you wear)! Instead it is an abbreviation for Better Off Overall Test.

The new laws allow for award conditions to be varied on an individual basis as long as the variations result in the employee being better off overall when compared to the award conditions.

What does this really mean?  Well it means employers and employee can agree to more flexible conditions providing the BOOT is passed.  However, it also creates some problems for employees leading up to 1 January 2010 when the BOOT comes into effect.

On 1 January 2010, a new safety net will be coming effective for all national system employers.  This safety net will comprise new Modern Awards and the Minimum Employment Standards.  New modern awards will cover all employees under a threshold which is roughly $100,000.

If you currently have employees on agreements (or AWA's), come 1 January 2010 these agreements will need to pass the BOOT.  If they do not you may be in breach of the award covering your industry or the minimum employment standards. This may result in investigations by Fair Work Australia and/or relevant unions and significant costs to your business in fines, backpayments and time.

So what do you need to do?  First you need to review your agreements to ensure they are compliant with the new minimum standards.  Then you need to alter your practices to ensure you will be compliant by 1 January 2010.

Leaving this until 1 January 2010 is not the right thing to do!  From January 1 if you are not compliant you are in breach of the legislation and an employee or union may report you for the breach. 

So be aware of the BOOT - start looking at your agreements and systems now! People Smartz are currently offering free employment compliance reviews to businesses.  These reviews will identify for you the areas you may need to act to protect your business.