Sources of employee rights & what you need to know
Did you know that employees have rights that come from contracts as well as awards, enterprise agreements and legislation ?
It’s easy to get confused if you don’t know how all the pieces work together.
But there’s no need to be confused.
One principle is important to understand first. It’s this: An employee contract can have more but not less generous terms than those set out in an award, enterprise agreement and legislation.
An employee contract can have more but not less generous terms than those set out in an award, enterprise agreement and legislation.
Below is an outline of the sources of employee rights.
A contract can be verbal, written or a mix of the two.
And your employee’s contracts can have more but not less generous terms for your workers than an award, enterprise agreement or legislation.
And if you have provided more generous terms in an employee contract, those terms will apply over the minimum legal requirements.
The employer writes to the worker once they have left and claims they have overpaid the worker by $20,000 because their wages in the contract exceeded the award rate.
Does the employer have the right to claim from the employee ?
The employment contract had a higher rate than the Award and this is allowed. The employer cannot then renege and claw back the difference between the Award and the contract.
So what exactly is an Award ?
An award outlines the minimum pay rates and employee conditions for some industries in Australia.
An employer can of course pay employee's more than the award minimums.
Currently, there are 122 Awards in Australia.
The term industry has to do with the product being produced. For example - the hair and beauty industry or the fast food industry.
Tip: You should always check the coverage section of an Award if you are unsure whether it applies to your workers (usually clause 4) and also review the job classifications section.
Always check the coverage section of an Award if you are unsure whether it applies to your owners (it's usually clause 4), also review the job classifications section.
Importantly, Awards won’t apply if an organisation has an enterprise agreement.
Also, an award cannot exclude the national employment standards.
So, what exactly is a registered agreement ?
An enterprise agreement is an agreement made at the enterprise level and can be legally enforced.
An enterprise agreement sets out the rights and responsibilities of employees and employers covered by the agreement.
Similar to Awards, enterprise agreements cannot exclude the national employment standards and if an award does, then it will have no effect.
The Fair Work Act deals with enterprise agreements and covers:
And finally, legislation.
And includes minimum entitlements for workers.
Here’s a sample of what’s covered:
It's important to note that state and local employees are not covered by the Fair Work system.
Look at any applicable award, enterprise agreement (if any) and Fair Work legislation to see if your workers have other entitlements when you prepare employment contracts and also when your employee’s query their entitlements.
Employment agreement terms will apply unless an enterprise agreement, award or legislation contains more generous terms for your employee’s.
If in doubt, it’s always a good idea to reach out for advice.
Do you need help from an Australian business lawyer for startups? Contact us today for help on email@example.com or 1300 478 278 Australia wide or on +61 2 9151 7233 from overseas. We are always glad to help.
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