4 Things All Employers Need to Know to Avoid a $54,000 Fine

In July last year, Fair Work Australia increased the penalties for a breach of the Fair Work Act 2009 (Cth). The maximum penalty has risen from $51,000 to $54,000 for businesses and $10,200 to $10,800 for individuals. As Fair Work claims against employers are on the rise, this number is having a drastic effect on the business community.

Virtual Manager has summarised 4 key things that you, as employers, must do to ensure you and your workforce are compliant and avoid getting slammed with a whopping $54,000 penalty:

1. Ensure Your Policies & Procedural Documentation Has Been Written by a Legal Professional/Firm
Whilst you may have gone to the trouble of writing your own organisational policies and had your staff read & sign them, they may not be legally binding, stand up in court or protect you in a legal dispute. The policies you have written could also create a Fair Work Claim by one of your employees based on the wording and the implications of the policy. It is advised that all organisational policies and practices (such as bullying/harassment, WH&S, anti-discrimination, etc.) should be written by an industrial relations or employment lawyer/firm and be consistently updated to align with any changes made to the Fair Work Act. Even if a business has hand written policies that have been understood and read by employees, an audit by Fair Work would likely still result in a fine for not being legally compliant.

As the legal costs of having these thirty or so policies drafted by a legal firm can exceed $30,000-$50,000, the ability for small and medium businesses to remain compliant, is simply unaffordable. Virtual Manager decided to change this and in 2015, we partnered with a law firm and founded an automated policy & procedural compliance platform for all businesses.

HrComply is the complete organisational policy & procedural system for small, medium & large businesses. It ensures their workforce has access to the most up to date policies & procedures, giving employers greater protection against claims such as unfair dismissal, discrimination and workplace bullying. Staff read, agree and sign off electronically on all policies via their own personal login. Business owners and managers can concentrate on running the business more and dealing with employee issues less when it comes to compliance. Additionally, it is all available at a very affordable price and setup is a breeze as we do it all for you.

2. Provide Proof That the Employee Has Read and Signed the Documents
How can you prove that an employee has read and signed that they understand a policy? A signature? Unfortunately today, a signature may not be sufficient proof that the employee understood and agreed to the policy if an employment dispute reaches arbitration or litigation. As there is no proof that an employee was actually given the documents or read them they can turn around and say that they were simply never given access and were just made to sign the policies. There may also be uncertainty on whether the employee received, understood and agreed to any updates to those policies along the way.

Thankfully with HrComply, all policies and procedures are accessible via the employee’s dashboard, which can be accessed via a phone, tablet or computer. Employees can read the required policies, conduct a short quiz to show understanding and sign off that they agree to that policy. The system dates and timestamps each step, recording how long the employee spent reading the policy and if they signed off or not. If they sign off on a policy, a PDF is created with their signature attached to that policy with the date & time and is stored electronically in cloud storage. It is also available for download if a hard copy is required.

3. Ensure Your Policies & Procedures Are Up To Date
Despite forking out tens of thousands of dollars to have a set of legally compliant policies drafted by a legal firm, they are only valid until a new policy or Fair Work update is issued (generally every 12 months). That means that the original asset of $30-50K that you purchased to reduce your risk as an employer is now redundant and has depreciated 100% in twelve months. As previously stated, if audited by Fair Work Australia and found to not have updated policies and procedures, which were compliant with the legislation at that time, you are still likely to receive a fine as you are no longer considered by Fair Work to be “compliant”.

In partnership with our legal firm, HrComply automatically issues alerts to business managers and owners as soon as a new policy or procedure is released. The system also automatically adds the new or updated policy to the employee’s dashboard and sends them an alert that they have a new policy to read and sign.

4. Backup Your Documentation
If Fair Work Australia were to walk into your business tomorrow and conduct a full audit, would you feel confident that you would not receive a fine? The majority of answers for most small to medium businesses is no. Even if you have your policies and procedures signed and stored, they can often be misplaced, thrown out or accidentally stored in other files, making it impossible to find. We always recommend to backup your legal files. It is always the case that you don’t think to backup your files until the unthinkable happens and you have lost them. At which point it is too late to recover.

Fortunately, HrComply operates on a cloud-based platform that is stored and backed up on remote servers across the country. You will never be left scrambling for policies or procedures again and everything is available via your dashboard with the click of a button.

With the silly season approaching us, we find that now is the perfect time to ensure all your employees have read and signed off on the organisational policies before they get up to mischief at the Christmas party. As the employer, you have a duty of care for all staff members, even at a social event such as the annual Christmas party. Unlike your typical hangover, a Panadol approach will not resolve a legal employment dispute. Save yourself time, money and stress by ensuring your workforce and you as a business owner/manager are compliant.

Sign up and get started on the HrComply platform today. Call us on 1300 559 060 or contact us below to arrange a free demonstration.

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