In this article series, we look at what makes a modern-day ‘good employer’ and explore the connection between a company’s culture and its performance.
A good employment relationship starts with a strong foundation. Like Julie Andrews says in the Sound of Music “let’s start at the very beginning, a very good place to start”. Below are our key tips for building and maintaining a solid foundation in the modern work environment, from hiring, to employment agreement and beyond.
It starts with the job ad
If you view the employment relationship as a house, the recruitment process is the ground that you are building onto. Recruitment practices are imperative. Getting the right person starts with considering and deciding exactly what you need for the role.
Make sure the job advertisement reflects key requirements including qualifications, years of experience, particular skills or personality traits.
Ensure you have a consistent process for each candidate, appropriate vetting questions (that do not breach any discrimination rules), reference checking and some personality testing. These factors all help to ensure you are making strong hiring decisions.
The employment agreement
Once you have your selected candidate, it is a legal requirement to have a signed employment agreement for each employee.
Continuing with our house metaphor, this is the poured foundation. Ensure your employment agreements are:
- up to date;
- fit for purpose for your business; and
- have legally sound clauses for business-specific requirements such as trial periods or restraint of trade provisions.
As business owner can you confidently say that you know that each of your employees has an employment agreement, and that the employment agreement reflects their current role?
If you have an employee who has been with you for four years and they are still on the same agreement as when they started, it might be time to track down the agreement and consider if it is still fit for purpose (especially if the nature of their role has changed in that time).
Getting it right – choosing the right employment relationship?
It is essential the employment agreement reflects both the intended and actual employment relationship. The three most common employment relationships are:
- Permanent (full-time or part-time).
There are many different types of working arrangements under each of the above umbrella terms. For example, fixed-term workers could be seasonal, and casual employees could be part of the gig economy, working on an ‘as and when required’ basis.
A common pitfall is employing someone under an agreement that does not reflect the real nature of their employment. For example, permanent part-time employees are often mistaken for casual employees because they ‘only work 10 hours per week’. An employer employing this person on a casual agreement can quickly run into trouble.
Having the wrong type of employment agreement in place creates a shaky foundation for your house (and business) and puts it at risk of legal claims.
If an employer were to end an employment relationship they thought was ‘casual’, but employee had developed a regular working pattern, they may face claims for:
- unjustified dismissal (which could lead to an employer needing to reinstate the employee to the role, reimburse lost wages and pay them compensation);
- unjustified disadvantage;
- breach of good faith;
- breach of contract; and
- retrospective holiday pay (which may mean the employer pays twice for the same period of holiday pay).
While employment agreements govern the specific terms and conditions between an employee an employer, workplace policies are documents that apply to all members of the team.
Policies are an effective way to support an organisation’s culture and define expected standards of behaviour. They form the walls of our house, the scope within the employee can do their role.
For an organisation that is looking to build their policy portfolio, we recommend starting with a Code of Conduct and required policies and developing from there. Again, policies should have a reviewing cycle and should be updated as required.
In our next article, we will talk about the thing that protects our ‘employment relationship house’ from the elements … culture (or the roof just to take the metaphor that bit little too far!)
We work with start-ups and organisations of all sizes to build and maintain a solid foundation of employment documentation that is legally compliant and fit for purpose. Get in touch with the team at Black Door Law if it is time to update your agreements and policies.