CCBR Business Review

20 B U S I N E S S T I P S Employment Agreements v’s Workplace Policies – What is the difference and why do businesses need both? EMPLOYING AND MANAGING staff is complex and can be both time consuming and a risk for businesses and managers. At some point in the employment relation- ship, paperwork will be needed to clarify the employment relationship. There are two main types of documents businesses use to detail the employment relationship: employment agreements (Agreements) and workplace policies (Policies) . Both documents, although very different, are important for any organisation employing staff. Importantly, these enable a clear understanding of the employment relationship for both the staff member and manager. Employment Contracts (Agreements) Employment agreements specify the legally binding relationship between an employer and employee. They usually includes important information like: when and where the work is to be carried out; what the pay will be; and what the employee has to do. These Agreements can also include more general directions such as confidentiality requirements and the ownership of intel- lectual property. There are additional employment obli- gations , which may not be written into the Agreement but are implied by law. For example, employees have a duty of fidelity – i.e. that an employee should not engage in activities which compete with their employ- er while an employment relationship exists. If the employer or employee breaches a term of the contract, the other party can apply to a court. Other Employment Obligations Additional laws which determine factors such as safe working conditions or mini- mum pay rates for a particular job are set out in legislation (laws) and modern awards, or the enterprise agreement contract. A breach of these can lead to a criminal pros- ecution. Workplace Policies Employers have the legal right to manage employee’s behaviour in the workplace, within reasonable limits. These require- ments can vary from day to day. However, other operational directions are ongoing and often applicable across all workers. An example includes process for handling inci- dences of bullying or harassment. These are generally referred to as Policies. Policies capture these operational direc- tives into a framework of behaviour and performance standards. Policies are general in nature and provide operational guide- lines for employee conduct and the behav- ioural expectations of both the employee and employer. An employee’s knowledge of the organisations expectations is par- ticularly important in maintaining a positive culture and preserving a functional work environment. These policy guidelines should be moni- tored and enforced to preserve the work- place culture. Drafting a Good Workplace Policy A key feature of a good Policy is flexibility. By Warwick Ryan, Partner, Hicksons Lawyers Importantly, unlike Agreements, Policies can generally be implemented and varied without the agreement of the employees. However, there are requirements in many Employment Awards for employee consul- tation before implementing a major work- place change. So an employer should speak to staff about any proposed new policy, or changes to an existing policy, before imple- menting it. Can Your Workplace Policies be Enforced in Court? When Australian courts have previously considered the enforcement of Policies, the main question has been whether Policies are included as terms of the employment agreement – and are therefore enforce- able. The court have shown themselves as willing to do enforce Policies on occasion – depending upon the way the employment agreement and the Policies are drafted. Where a court finds that it was the inten- tion that the Policies be treated as part of the Agreement, both the employer and the employees may be legally bound to comply with terms set out in Policies. In a recent decision, the Full Federal Court found an employer was liable for a breach of the Policy as they were incor- porated into the terms of the Agreement. Relatively small damages were awarded against the employer in that case, but in other cases the damages have been far more significant. So, Agreements and Policies are impor- tant considerations for businesses. To avoid liability for the breach of their own Policy, employers need to be comfortable that their policies have not been incorporated into the employment agreement. There are some simple steps to avoid this pitfall and protect employers, and we can assist you with this. The Department of Enterprise, Investment and Trade (DEIT), a new NSW Government department, opened for business one April 1st reinforcing the state’s commitment to eco- nomic development, job creation, innovation, new technologies, and liveability. Minister for Enterprise, Investment and Trade Stuart Ayres said the new department brings together enterprise and trade, tourism and hospitality, arts and culture, sport, and Western Sydney under one cluster. “Bringing together these agencies and groups into a new ecosystem will help drive our state’s post-COVID economic transforma- tion and create sustainable jobs of the future right here in NSW,”Mr Ayres said. “We are positioning NSW as the best place in the world to do business − where innova- tion, trade, tourism, sport and culture work together to drive the dream combination of economic strength and vibrant lifestyle. “We want to help NSW businesses find new markets and help drive collaborative partnerships between government and non- government organisations to fuel economic growth, and make Western Sydney an eco- nomic powerhouse. “This is also about ensuring we have the world’s best arts and cultural institutions, sporting facilities and events to create thriving communities and attract tourists alike.” DEIT Secretary Amy Brown said the new clus- ter will not just focus on economic outcomes but has a mandate to ensure liveability is a key focus for prosperity. “The quality of our neighbourhoods, work- places and cities has a significant factor on our economic development and our ability to attract talented workers, students and innova- tive companies to NSW,”Ms Brown said. “The new department will allow for more cohesive inter-agency planning and decision making, allowing us to build on our reputation as the number one place for people across the world to invest, live, visit, study, grow and play.” NSW to turbocharge economic growth with new department CENTRAL COAST BUSINESS REVIEW MAY 2022