Begin with the end in mind

This asset can easily become your biggest liability

If you have a growing business, it’s important to prepare as best you can to safeguard your success — and not inhibit growth by wasting time, effort and profits on fixing problems down the track.

Having lawful and carefully-drafted employment contracts and workplace policies may seem an unnecessary task compared to keeping work rolling in the door, but your single biggest asset in a small business is often your employees.

This asset can easily become your biggest liability if you have issues or disputes with your workforce. Not only can employee disputes be time consuming and costly, they may also stifle productivity and cause your business to fail to deliver on commitments to clients, leading to irreparable reputational damage.

Given the labyrinth of the Australian industrial relations framework, you must ensure your employment documents are prepared by somebody who understands that framework and that those documents are up to date and compliant with the Fair Work Act, the National Employment Standards and any relevant modern awards.

Employment contracts remove uncertainty by setting out the terms of the employment relationship and govern it going forward. If an employee claims they are entitled to something, having a well-worded employment contract that you can point to can clarify the issues without further dispute.

Contracts can also set out the time required for employees to give notice when resigning, as well as provide protections for your business interests when an employee leaves. This can be accomplished through restraint of trade provisions, which, if well-drafted, can be used to stop an employee working for a competitor or stealing your clients.

In addition to contracts, you should also consider the culture you want your workplace to have and how you will create it. Workplace policies can act as directions to employees and set out the rules of your workplace that will be invaluable tool in shaping your workplace’s culture.

Common workplace policies include equal opportunity, anti-discrimination, bullying, sexual harassment, drug and alcohol use, internet and social media use and leave, as well as procedures for both employees and managers to follow in the event of a grievance.

However, simply having policies is unlikely to be enough to create a positive workplace culture. You will also need to ensure employees understand and comply with those policies and that you apply the rules consistently and fairly. This means you should also consider workplace training when implementing your policies and procedures, and include a thorough induction procedure for any new employees.

It is also critical to ensure that policies are not incorporated into employment contracts, as this can create contractual rights for employees. This means an employee can sue for breach of contract where an employer fails to provide that right. This careful distinction can be achieved through well-worded employment documents. But failing to do so can be very costly for a business.

Organisations like the Chamber of Commerce and Industry WA can be a great resource for help with a Workplace Consulting team of lawyers and industrial relations specialists with experience in not only preparing employment documents, but also the practical application of those documents. They can also help employers work through disputes in the Fair Work Commission. All at prices that even the tightest businesses can afford and ensures the best documents for your business to reduce your risk of costly employee disputes.

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