INDUSTRIAL Relations Policy

Why:

In line with the BPA’s core ethos;

“To create a social and economic environment in which the citizens of Australia are

Occupied and are able to Prosper”

Industrial relations does not have to be a case of “Us” v’s “Them”.

We take the stance that the employer and the employee are not mutually exclusive and we as a nation need both to strive for economic stability and the pursuit of prosperity.

Not everyone can be the Boss, we need skilled and unskilled workers in our work place. 

Underlying this, is a Policy of fairness…..A fair days work for a fair days pay.

It is small/medium business (SME) and the employees of those small/medium businesses that are the economic back bone of the country. 

This Policy is intended to assist both the employer and the employee by not only bringing in a simpler, easier and more flexible industrial relations policy but also giving both the employer and the employee the tools they need to help them to comply with the changes.

Employees are paid by the Employer for their time. In reality, time is the only thing an employee has to sell. How much the employer pays for that time depends on the skill and industry in which they work

Our Policy is based on the current culturally accepted standards;

1. Standard working week is 37.5/38 Hours

2. Employees are entitled to 4 Weeks annual leave per annum

3. There is an underlying minimum award wage

4. Employees are entitled to 10 Days personal leave per annum

5. Employees are entitled to 8.6667 Weeks leave after 10 years of service

6. Employees are paid penalty rates for working after 7pm Weekdays, Saturdays, Sundays, and Public Holidays

7. Employees are entitled to Superannuation at the prescribed rate to be paid by the employers.

8. An employee and Employer are required to give agreed notice when terminating employment.

9. The Employer must provide the employee with a safe working environment

Current Situation

Broadly speaking an average full time employee is paid to work a 37.5 hour week. This equates to 1950 paid hours per annum.

However if we deduct four weeks annual leave plus 10 days sick leave and another 10 days in public holidays this employee is actually working 1650 hours per annum or 31.73 hours per week on average.

Assuming an employer is paying an hourly rate of $20 it is costing the employer $25.88 per actual working hour (Including Super)

If an employee stays employed by the same employer then the employee is eligible for an additional 8.6667 paid weeks of leave after 10 years of service. An entitlement many SME’s overlook.

For SME’s this current system can mean an escalation in employee entitlements not being accounted for in the SME’s balance sheet, potentially causing the SME serious liquidity/financial issues. It also can lead to employee’s entitlements not being paid in the case where the employer ceases business.

The current system of employee entitlements also encourages the employees to take advantage of these entitlements (such as sick leave) by “using up” any hours they may have accumulated during the course of the year.

The current legislation is cumbersome, complex and generally considered to be a mine field of contradictions.

For either an Employee or Employer to challenge the decision of Fair Work Australia in the Federal court is simply economically unviable. A decision against you with costs awarded would send many individuals (and SME’s) bankrupt.

Our Policy

In summary we propose the following;

1. There remains to be an underlying award system based on current award rates.

2. Base award rates are adjusted automatically on the first day of October every year in accordance with the CPI of the previous financial year.

3. All awards are reviewed every five years to reflect any changes to Employee/Employer accepted industry standards of employment.

4. The base award is a minimum with employees then able to be further rewarded with a three tier system.

                             a. Tier 1- Base rate- the 80% employee

                             b. Tier 2- Base rate plus 12.5%- the 90% employee

                             c. Tier 3- Base rate plus 25%- the 100% employee

5. Employees and Employers will be free to negotiate higher pay rates than the minimum award rate.

6. To encourage youth employment there will be a discounted award rate for employees under 18 years of age.

7. All entitlements (Annual Leave, Sick Leave and Long Service leave) are available to all employees and are accumulated in the employees Superannuation Fund.

8. Abolition of the three employee categories (Full time, Part Time and Casual) being replaced by the single category of “Employee”

Explanation

Employment contracts will stipulate the minimum hours that the employee is guaranteed employment in any given pay cycle. A “full time” employee will be for 75 Hours per fortnight a “Part Time” by example could be 42 hours per fortnight where a “Casual” would be guaranteed 0 hours per fortnight. Regardless of the guaranteed hours all shifts will carry a minimum of 3 hours work per shift.

9. “Commission only” or “Piece” work employment to be illegal unless there is an underlying minimum hourly rate in accordance with the appropriate award.

10. Incentive targets for Piece work or commissions must be achievable by a minimum 50% of the employees in the employers’ work force in any given geographical location.

11. “Cash only” or “off the books” employment arrangements deemed illegal and to carry heavy penalties.

12. Employers (and persons in effective control) found guilty of Point 11 above, by deliberately not paying or underpaying Employee entitlements/awards will be held personally responsible for any shortfalls. This liability will transcend incorporated structures, split assets, trusts and superannuation funds.

13. Government to provide the employer with the tools necessary to simplify compliance with the proposed changes. These include;

a. Software to make it easier for all parties to generate standardised employment contracts.

b. On line or stand-alone rostering software to enable employers to comply with their obligations.

c. Payroll expense summary in a hard copy or an automated file that the employer can up load to their bank to process all employee salaries and entitlements automatically.

d. Standardised employment forms, such as “Staff Warning” and “Termination” forms.

14. Employers need only provide one written warning to an employee for non-compliant work practices or for a work place infringement no less than 7 days prior to the termination of an employee.

15. “Personality” conflict in the work place between employees or employees and management are to be fair grounds for dismissal, provided that the employee has been given fair notice and the opportunity to repair or rectify the conflict.

Employee Cost Comparison (FTE) Actual Working Hours

The cost comparison is based on the actual cost (including superannuation) of a full time employee if that employee takes advantage of all entitlements excluding public holidays without overtime or penalty rates.

We are using an hourly rate of $20 as an example only.

Full Time/Part Time Employee (Current) $24.76 per hour

Casual Employee $27.38 per hour

Proposed BPA System $24.89 per hour