Legal Expert Guidance: Navigating changes to employment conditions

Legal Expert Guidance: Navigating changes to employment conditions as Australian businesses get back to work

As the Job Keeper scheme is extended for a limited time, the future is uncertain for many companies and their employees. In this economic climate, redundancies are inevitable and making changes to employment contracts may be the only option to keep staff on board. It’s important to seek legal help when navigating through revising conditions as disputes can arise if the necessary steps are not taken early on. Legal expense insurance can provide expert help immediately with several legal documents available online with a no fee consultation with a lawyer. It is a piece of mind for businesses that are already struggling to keep their business afloat and where every decision is now about survival.

Lawyer Jack Corry from James Tuite & Associate Lawyers from our legal panel who will be joining us for a live Q+A Webinar on the 22nd of October 2020, answers some of the most important questions businesses have when navigating changing employment contracts and redundancies.

In the current economic climate what have been some of the hurdles you have seen businesses face in the legal space in terms of employee contracts and disputes?

Currently many businesses are attempting to achieve a difficult balance whereby they desperately need to minimise their wage bill whilst at the same time avoiding the large financial exposure to the business brought by mass redundancies. As a consequence, employers are needing to renegotiate salaries and working hours with their employees. We have seen some businesses attempt to do this the wrong way by unilaterally imposing changes to its employment contracts, which gives rise to a risk that the employer has repudiated the contract. Exposing the employer to a claim for breach of contract.

What are necessary preventative measures companies can take when changing contracts?

As touched on above, any changes to the employment contract cannot be done unilaterally. Employers need to also avoid bullying or coercing an employee into agreeing to contractual variations, otherwise it risks adverse action or unfair dismissal claims on the basis of constructive dismissal.
Any contractual variations must be recorded in writing and signed by the employer and the employee. Businesses need to ensure that the variation is legal and accordingly should seek advice. For example, any reduction in remuneration must not fall below the minimum remuneration required pursuant to the National Minimum Wage, modern award or enterprise agreement (as applicable).

In our view, the most necessary measure a business should take is being open and honest with the employee as to why the contractual terms need to be varied, how long the business considers the variations will need to apply and more generally advising the employee of the path the business is taking out of the crisis. In our experience, employees are significantly more prepared to accept variations when this occurs.

Disclaimer: Please note that the content of the webinar does not constitute legal advice and should not be relied upon as such. Always seek legal advice on your particular circumstances before taking any actions contemplated or discussed in the webinar. Some information may have been obtained from external sources, in which case we cannot guarantee the accuracy of such information.