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The Employment Contract

The Employment Contract. A legally binding agreement between employer & employee Usually written Outlines rights, responsibilities and duties of each party to the contract Involves offer, acceptance and benefit. Common Law Contracts.

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The Employment Contract

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  1. The Employment Contract • A legally binding agreement between employer & employee • Usually written • Outlines rights, responsibilities and duties of each party to the contract • Involves offer, acceptance and benefit

  2. Common Law Contracts • Common law is made in the court system & developed over time by judges decisions which become ‘common’ to all citizens • Features of contracts which have been tested in the court system include employers responsibility in: • Provision of work • Payment of income • Abiding by law • Duty of care For employees, they must: • Follow instruction • Use care & skill in their job • Act in good faith • Most workers are on these agreements. They include professions such as accounting, law etc that are not covered by awards.

  3. Statutes • Statutes simply refer to laws made by Federal & State governments pertaining to the workplace • Note that there is a Federal & a State industrial relations system • In NSW the Industrial Relations Commission resolves disputes, makes awards & agreements. Over 40% of NSW employees are covered under this framework. • Federally there has been a move to diminish the power of the States. • The AIRC has been the principal industrial body & was involved in awards & dispute resolution.

  4. Statutes cont… • The Federal Government has passed a lot of legislation that relates to the employment relationship. This legislation includes: 1907 – Harvester Case (basic wage) 1969 – Equal Pay Case 1975 – Racial Discrimination Act 1979 – Maternity Leave Act 1984 – Sex Discrimination Act 1988 – Industrial relations Act (Structural Efficiency Principles linkinig wages to productivity increases) 1996 – Workplace Relations Act (Certified Agreements & AWA’s) 2005 – Workchoices Amendment Act (labour market decentralisation) 2008 – Workplace Relations Amendment Act (Forward with Fairness Act)

  5. Awards • An award agreement is a collective agreement made between employers and unions at a centralised level • They used to be governed by the AIRC • Used as a benchmark for the entire industry they cover • Are adjusted when a national wage case is heard by the AFPC • Cover many industries such as education, nursing, hospitality, retailing, trades, government etc.. • Used to Allow for only 16 matters to be agreed upon such as allowances, penalty rates, rostered days off, paid maternity leave etc.. Check out an what an award looks like at: http://www.industrialrelations.nsw.gov.au/awards/controller.jsp

  6. Enterprise Agreements • Under the Workchoices Amendment to the Workplace Relations Act, there were a range of new enterprise agreements that could be made. Check the reaction of the ACTU here: http://www.youtube.com/watch?v=diNhdEqaQGw • In 1996 the government allowed for AWA’s and Certified agreements (collective, involved unions at a workplace level) • Now there are more types of agreement which include: • AWA’s: individual agreement between employer/employee • Employee (non union) collective agreements • Union collective agreements • Union greenfield agreements: Negotiations with a union for a new business or new location • Employer greenfield agreements: employer/employee agreement for new location/business • Multi Business Agreement: Can involve a group of businesses & negotiated with unions or employers

  7. Contentious Changes of Howard • The basic aim is to decentralise the labour market. In other words, put less emphasis on central decision making bodies such as the AIRC and more on the employers and employees in individual workplaces. This would hopefully provide more flexibility to workplaces & allow employers to link wages to productivity. The big change under Howard was the change to the no Disadvantage Test. Essentially this meant that workers could be worse off under an enterprise agreement • The no disadvantage test no longer applies to AWA’s (although in May 2006 the Government introduced the Fairness Test) • The attempt by the government to introduce a National Industrial System & abolish State based industrial systems under the Corporations Act. • Unfair dismissal no longer applies to workplaces with less than 100 employees. • OWS, now renamed the Workplace Ombudsman responsible for the monitoring the compliance of firms to workplace agreements. Investigate employers who fail to meet obligations.

  8. The New System – Simplification? The Key changes to the system are as follows: • Introduction of FAIR WORK AUSTRALIA – replaces the AIRC, AFPC, Workplace Authority – a one stop shop • Abolition of AWA’s – to be replaced by Individual Transitional Enterprise Agreements (ITEA) Once these run out there will be no more AWA’s or ITEA’s. • Return of the No Disadvantage Test for enterprise agreements • New national employment standards • Modern Awards with flexibility clauses for workplaces to make clauses which suit their site.

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