Is it time for a HR Health Check? Practical Tips for Employers to Reduce Risk in 2020
With 2020 well underway, it might be time for employers to undertake a ‘HR health check’.
Undertaking a HR health check will help to minimise workplace risks and set your business up for a great year ahead.
In this update we look at some practical tips that employers can focus on now to avoid costly and time-consuming issues popping up down the track.
Practical tip #1 – Review your Employment Contracts
Businesses should review their current employment contracts and put employment contracts in place for employees who do not currently have one.
We are often asked why employment contracts are needed. Put simply – employment contracts protect employers and their business, whereas awards and the National Employment Standards in the Fair Work Act are more aimed at protecting the employees’ interests.
A well drafted employment contract will clearly set out the terms and conditions of an employee’s employment, including any specific obligations that the employee is to abide by.
These can include obligations in relation to confidential information; intellectual property and post-employment restraints, as well as warranties to be given by the employee.
Employment contracts should be reviewed regularly to ensure they continue to accurately reflect the terms and conditions of each employee’s employment and are up to date with any changes in employment laws.
Practical tip #2 – Review your Workplace Policies and Procedures
Workplace policies and procedures often get implemented and then forgotten about until the time comes when they need to be relied on and then it is discovered that they are not up to scratch, or up to date, or employees have not been provided training in relation to them.
To avoid these issues arising in your business, policies and procedures should be regularly reviewed and updated to ensure they are current with your businesses values and up to date with any changes in employment laws.
Employees should receive regular refresher training on the policies and be given a copy or advised where they can obtain a copy of the policies.
Some of the policies that employers should have in place include:
- Discrimination and Harassment;
- Workplace Bullying;
- Workplace Health and Safety;
- Social Media Usage;
- Email, Internet and Computer Usage;
- Drug and Alcohol; and
- Dispute Resolution and Grievance Procedures.
Public and large proprietary companies are also legally required to have a Whistleblower Policy in place from 1 January 2020.
Practical tip #3 – Review your Employee Arrangements
Ensuring that you have correctly engaged the persons performing work for your business (such as your casuals and your contractors) will be particularly important in 2020.
We are expecting some major court decisions and potential new legislation in relation to casual employment to come through this year and the Fair Work Ombudsman continues to focus on independent contractors and sham contracting.
In relation to casual employees:
- Do you know your risks if you employ long term, regular casuals and how to reduce these?
- Are you complying with the casual conversion clause in your award, if one applies?
In relation to independent contractors:
- Are they correctly engaged?
- Have your arrangements changed over time and the contractor could now be classified as an employee?
- Are you aware of the risks of engaging contractors and how to reduce these?
Practical tip #4 – Get on top of your Award and Ensure you are Paying your Employees Correctly
This will be another important area to be on top of in 2020 as awards are undergoing significant changes with the Fair Work Commission finalising its 4-yearly review and the Fair Work Ombudsman regularly prosecuting employers for underpaying employees.
The first group of varied awards came into effect on 4 February 2020 (see our alert here) with the next group likely to commence in April 2020.
It is vital that employers are familiar with the award/s that apply to their employees generally, as well as any changes coming through.
Breach of an award can not only result in employee disharmony and claims for underpayment of entitlements, but also penalties of up to $63,000 per breach for employers and $12,600 for individuals such as directors, managers and HR personnel who may be found to be an accessory to the breach.
Employers should also review their payment processes to ensure they are paying employees correctly.
This may include things like checking you are applying the correct award and classifications, paying relevant overtime, penalties and allowances and that timesheets are accurately recorded.
Practical tip #5 – General HR housekeeping
The last practical tip employers can look at to reduce workplace risk in 2020 is some general HR housekeeping.
These are the types of things that often get left behind but can cause major issues if they are not done correctly and include such things as:
- organising refresher training for your policies and procedures, including WHS training;
- reflecting on employee performance and behaviour and tackling any poor performers or inappropriate conduct that may have been flying under the radar;
- making sure employees have signed and returned their employment contract and that all employment contracts have been signed by someone on behalf of the business;
- ensuring that any variation to an employee’s employment contract (e.g. position, duties, location, term, remuneration) are confirmed in writing with the employee and signed by the employee;
- accurately recording hours of work, particularly overtime hours, for award covered employees;
- considering any restructure or redundancies that might take place this year and ensuring you are set up to comply with your legal obligations;
- reviewing your hiring practices such as your job postings, reference checks, interview techniques and pre-employment questionnaires to ensure you are not breaching anti-discrimination laws; and
- ensuring that your business is complying with the employee record-keeping obligations under the Fair Work Act.
Undertaking a HR health check and tackling some of the areas we have discussed in this update will help employers to minimise their workplace risks and reduce any costly and time-consuming issues popping up down the track.
If you would like us to undertake a HR Health Check with you, please contact us to arrange a time to meet with one of our lawyers.
If you would like further information on any of the tips discussed in this update, or advice on any employment law related matter please get in touch.
Disclaimer: The information contained this article is general and intended as a guide only. Professional advice should be sought before applying any of the information to particular circumstances. While every reasonable care has been taken in the preparation of this update, Aitken Legal does not accept liability for any errors it may contain. Liability limited by a scheme approved under professional standards legislation.