Employment Contracts and Awards
The legal advice we provide you in this area, will depend upon a number of factors, such as the type of work performed, and whether that type of work is covered by either a federal or state award.
We have outlined some basic principles below, however care should be taken, and advice should be sought to make sure you have the correct information applicable to your circumstances.
All employers and employees are covered by the National Employment Standards (NES).
Under the NES, employees have certain minimum conditions, such as minimum entitlements to leave, public holidays, notice of termination and redundancy pay.
There are 10 minimum workplace entitlements in the NES:
- A maximum standard working week of 38 hours for full-time employees, plus ‘reasonable’ additional hours.
- A right to request flexible working arrangements to care for a child under school age, or a child (under 18) with a disability.
- Parental and adoption leave of 12 months (unpaid), with a right to request an additional 12 months.
- Four weeks paid annual leave each year (pro rata).
- Ten days paid personal/carer’s leave each year (pro rata), two days paid compassionate leave for each permissible occasion, and two days unpaid carer’s leave for each permissible occasion.
- Community service leave for jury service or activities dealing with certain emergencies or natural disasters. This leave is unpaid except for jury service.
- Long service leave.
- Public holidays and the entitlement to be paid for ordinary hours on those days.
- Notice of termination and redundancy pay.
- The right for new employees to receive the Fair Work Information Statement.
- In addition to the NES, an employee’s terms and conditions of employment can come from a modern award, agreement, pre-modern award and state or federal laws.
Modern awards cover an industry or occupation and provide additional enforceable minimum employment standards. There is also a Miscellaneous Award that may cover employees not covered by any other modern award. It is however important to note that if you are a high income earner, the modern award that covers your industry or occupation may not apply to you, but the NES will.
When an employee accepts a specific offer of employment (oral or written), a contract of employment has been established. Under this contract, both the employer and employee have certain rights and obligations.
Contracts of employment may contain provisions for probationary or ‘trial’ periods on commencement of employment and the employee must be paid during any such period.
In NSW, the parties to a contract of employment cannot agree on or contract outside wage rates or conditions of employment less favourable to those set out in the applicable award or enterprise agreement.
The contract of employment need not be in writing (but usually ought to be) and in many cases the contract is verbal. The terms of the industrial award or enterprise agreement are usually the main terms in an employee’s contract of employment.
It is a good idea to confirm any offer of employment in writing, and for the employee to accept the offer by signing a letter of appointment before starting work. The letter of appointment should cover:
- details of the job duties;
- whether the job is full-time, part-time, casual or permanent;
- the award or agreement applying to the position; and
- any special or additional conditions of employment that apply in your workplace.
The following are the terms that are most commonly found specifically talked about or written down by the parties to a contract of employment:
- Title of the position and statement of the duties;
- Wages or salary or remuneration benefits for the position;
- Hours and days of work;
- Leave entitlements;
- To whom the employee reports;
- Where the employee is to work; and
- How the contract may be terminated.
A contract of employment is legally enforceable through the courts in the same way as any other contract. However, the courts will not usually order specific performance of the employee’s contract and will not usually force an employee to work for a particular employer.