There are a number of common and costly mistakes that employers make – but they can easily be prevented. Are you making any of these mistakes? There is a tonne of legislation pertaining to employers and their employees and you need to understand what you may be liable for. Many clients that we meet are not aware of the basics and therefore exposing themselves to breaches which can be extremely costly. Check out the list below to see how you are tracking. Do you know:
- Casual employees can accrue Long Service Leave – casual employees in NSW accrue Long Service Leave. This would need to be paid out, if you made them redundant after 5 years service
- Casuals can automatically become permanent after 12 months – in many of the Modern Awards there is a clause that automatically converts casuals to permanent employees after 12 months. Watch out that this does not happen to you
- Some Awards do not let you pay overtime using a ‘time in lieu’ arrangement – make sure you check as some Awards do not allow you to use a time in lieu approach to managing overtime payments
- You must have a company superannuation policy if you are asked for one by your employees – you cannot assume all your employees will already have an established superannuation fund and if they wish to use yours you need to make one available
- In an interview, you cannot ask someone where they live and how long it would take them to get to work – this could be deemed as a discriminatory question, if you use this to make a judgement on whether to employ the candidate or not
- You need to keep interview notes for five years – a candidate may claim that you discriminated against them in an interview a number of years after the interview. Make sure the rationale and note taking for your decision is robust
- You need to accurately record the use of personal leave – employees have 10 personal leave days per year – you need to ensure that you accurately account for each day of leave taken. While this leave is not paid out at termination, it can be costly if they are consistently using 13 per annum rather than 10 days (this can also be bad for team morale)
- You can have employees on extended stress leave that can also be a candidate for performance management – some employees, at the first whiff of performance management, race to their Doctor to get signed-off on stress leave. You can still manage the performance of someone on stress leave – it is just significantly more complex and time consuming
- You may have the opportunity to make a ‘forced’ shutdown, for example at Christmas – most businesses have a quiet time of year and for many it is Christmas. Many Awards allow you to use a forced leave period during this time. This can be a great way to reduce annual leave accruals
- You cannot stop an employee from attending Jury Duty – being busy at work is not a sufficient reason to not allow an employee to attend Jury Duty. You still need to pay the employee and receive the government’s payment
(I started this blog with the simple idea of sharing ten easy mistakes and now I am nearly up to forty (last missive coming soon). Hopefully this has been useful and you are now able to avoid some of the most common mistakes business owners make – and don’t worry, you are not alone!
