Win an Annual HR Support Package with Red HR!

Are you an employer of a small to medium enterprise?

As an employer of a SME, do you manage your human resources on your own?

Do you struggle to keep up to date with changes in workplace legislation and how such change may impact your business?

In March 2016, Red HR is giving away a 12 month HR Support Subscription where the winning employer will be able to receive on-tap support in human resource management, from our Principal, Melinda Dixon.

For many employers of small to medium businesses, getting the right advice on HR issues before acting is critical to ensure a positive outcome for all parties can be achieved.  In the absence of a dedicated HR specialist on staff, many small to medium business owners are looking for accessible HR support when they need it, as often as it is needed, and at a cost that can be controlled.  Based on a demand for such a service, we created our own HR Subscription Service.  For a one-off annual cost, clients receive all of the support they need on day to day HR issues.  Since its launch, the HR Subscription has been very successful, particularly amongst small to medium businesses for which it was created for.  Something I often hear from my clients is, “Mel I love how I can email you or call you as often as I like if I need to get your advice on a matter, and know that I don’t have to worry about getting an invoice at the end of it.”

Here is what is included in an Annual Red HR Support Subscription:

  • Direct and strictly confidential response by phone or email from Melinda Dixon, Principal of Red HR, on all of your day to day Human Resource Management issues, no matter how small or how big the issue may be;
  • For employers who may be a little time poor during business hours, I can also be contacted outside of working hours;
  • There is no limit to the number of support calls / emails you can initiate.  Clients can contact me as often as they like with their questions / concerns on HR matters for a one-off annual cost;
  • Monthly Red HR e-bulletins to keep you informed and up to date on the HR/IR landscape and how it affects you and your business;
  • Red Alerts to bring important HR issues to your attention as they arise;
  • A 20% discount on professional fees quoted for HR Management projects that fall outside of the scope of the subscription.  If a specific task or project to be undertaken on your behalf, falls outside of the scope of the subscription, you will be advised of this at the time of your enquiry and a quotation for the work to be undertaken will be provided before proceeding.

We are giving away an Annual HR Support Subscription to one employer.  To enter, click onto the Red HR Facebook page for details.

Reference Checking – Are you Getting the Real Picture?

When employers have identified a candidate for a job, how many employers are getting an in-depth, real picture on the candidate from the reference checking process, rather than making a decision based on what they see on the surface?

Employers, when a candidate for a job provides you with their list of referees, do you simply focus on those referees they have provided, or do you ask the candidate for permission to contact others who may be more relevant?

No candidate is going to provide you with the details of a referee who will provide a less than positive reference. Therefore it is up to the recruiting employer to ensure they speak with the most relevant parties possible. Obviously if a candidate is currently employed, a prospective employer is not likely to be able to speak with the candidate’s present manager without jeopardising the candidate’s current employment. However, with previous employment, prospective employers should refer back to their interview notes when they asked the candidate who did they report to in that role, what was their position, what was their name etc. If the person the candidate mentioned in the interview is different to who they have nominated as a referee from that business, challenge it by asking the candidate why was their manager from their last role not nominated as a referee. In some instances, there can be a very logical explanation, but in others, it can identify a red flag which may need to be investigated. Here is where I would be asking the job candidate for their permission to contact their manager from their last position, the same person who the candidate had spoken about in the interview. Some candidates may show some hesitancy with this, particularly if there is concern that something negative could come out, however most candidates will give their permission here.

Obviously at the end of the day, it is a prospective employer’s priority to ensure a candidate’s current employment is not jeopardised as part of the reference checking process. However, in the absence of talking with a candidate’s current employer, prospective employers can still maintain control of the reference checking process by talking to all other key people who need to be spoken with.

New “Two-Stage” Test for Unfair Dismissal Claims

In the final report from the Productivity Commission’s workplace relations inquiry, the PC has recommended a new “two-stage test” for unfair dismissal claims. The first stage would determine if there was a valid reason for the dismissal, and if yes, the second stage would consider whether due process was followed. This would reduce the circumstances where an employee’s claim has been successful due to their employer failing to follow due process.

I have read many case decisions where the employer may well have had a valid reason for terminating the employee’s employment, but essentially lost the case based on poor process. The two-stage test would better deal with this issue with the focus being more on whether or not there was a valid reason for dismissal.

The PC also recommends taking the emphasis off reinstatement, noting that compensation is much more commonly ordered.  In a Fair Work Commission report for 2014/15, less than one per cent of employees were awarded reinstatement as their remedy.

Clean the Slate for 2016

Before most businesses temporarily closed their doors for the Christmas / New Year period, how many employers took the opportunity to clean the slate and possibly some cobwebs on long running HR issues? As we are now half way into month two for 2016, I hope many employers found that opportunity to clean the slate and get the ducks in a row to kick off 2016 with renewed energy.

MUA and Labour Hire Company ordered to pay $800,000 over “Closed Shop”

In a recent decision from the Fair Work Ombudsman, a non-union couple were denied employment simply because they were not members of the union.  The couple had applied for work as ship stewards in 2009 and although the labour hire company wanted to employ them, the couple were told they would need to first join the MUA.  The MUA refused their membership applications, in line with its policy of giving preference to “beached” out-of-work members.  In determining compensation, Justice John Gilmour said he considered the couple would have been “above average employees” free of an “entitlement mindset” and could reasonably be described as “salt of the earth” people.  He said that if they had been engaged, the couple would “not have readily given up such employment” as stewards on the vessel, and calculated their income loss over five years from 2009.

Although the contraventions arose from the conduct of both the MUA and the labour hire company, Justice Gilmour said “there was no parity or even approximate parity” and the MUA’s bore “far greater” culpability.  Therefore, the MUA was ordered to pay two thirds of $723,000 in compensation for the couple, plus a further $80,000 in penalties for contravening the Workplace Relations Act and the Fair Work Act.

To secure preference of employment for union members contravenes the freedom of association principles.

Personally, I am a little surprised that we don’t hear more about other cases that are similar to this one.  Perhaps if we did, it would send a stronger message to those unions who may still choose to operate under similar practices as this case.

When “Internships” can be Expensive for Employers

In 2013, the Fair Work Ombudsman commissioned a report on the subject of unpaid work in Australia, as there is growing concern about the application of unpaid internships / work experience placements within Australian businesses.  The FWO has recently completed its first of what I suspect may be many prosecutions of businesses who fail to pay minimum wages to “interns” where it has been proven such interns have been required to do more than watch, listen and learn.

For many years, young people have hunted for work experience opportunities in the hope of breaking into a particular industry and/or a specific business.  At the same time, many employers also openly promote their work experience / internship programs.  However, FWO are concerned at the number of businesses who are at risk of exploiting unpaid interns when they are required to produce work that contributes to the overall productivity of a business. 

Fair Work Ombudsman Natalie James said when a worker “moved beyond merely learning and observing and starts assisting with business outputs and productivity, workplace laws dictate that the worker must be paid minimum employee entitlements”.  “The FWO did not want to stifle genuine learning opportunities that help young people get a foot in the door but we also don’t want to see young people being treated unfairly through unpaid work schemes”.

For any employer who is currently or considering offering internships that are “unpaid”, please ensure you have taken the right steps to demonstrate that your work experience placements are offered on the basis of a genuine learning opportunity and not one where the business can profit from the experience of an unpaid intern.

Drunk the morning after……………..misconduct or gross misconduct?

In a recent legal case decision just prior to Christmas, a state manager from an insurance company had been sacked for arriving drunk at a staff training conference, the morning after a work-related function.  The NSW District Court judge accepted the employee had smelt of alcohol, spoke loudly, lacked seriousness, threw a lolly and made animal noises, however after the judge took into account the company’s approach to drinking, based on a review of the employee’s contract of employment, company policies etc, he accepted that the company had proved the state manager’s misconduct, but not gross misconduct.

“Something more is required, some aggravating conduct such as repetition of the intoxication, a severe level of intoxication, adverse impact on employee or client safety, violence, offensive conduct or offensive language, a serious impact on reputation or significant financial loss.  “But none of these features or other aggravating features existed in this case.

“Here there was a manifestation of low-level intoxication, without other consequences of behaviour of significance.”

The judge said the manager spent most of the morning at the back of the room by himself working on his iPad.

“In my view, this behaviour, [the manager’s] condition at the conference, does not constitute a repudiation of the agreement, or other sufficiently serious misconduct enlivening a power of summary termination. It was not serious misconduct in serious circumstances.”

The state manager was awarded damages of $296,650 based on $99,092 in lost salary, $118,182 for his lost retention bonus, $48,620 in long service leave and $30,755 in interest.


Another example of the many cases relating to “Sham Contracting”

In another case example from the many that go through Fair Work relating to sham contracting, this week a building company will now face civil penalties and a possible compensation order for dismissing a construction worker so that they could re-employ her as an independent contractor.

The judge rejected company evidence that the excavator operator was dismissed because there wasn’t enough work for her.  The company had excavator work to be done and the employer had been satisfied with the employee’s work performance to date.

When the employee was being dismissed, the excavator was given a letter saying that the company was happy with her work and her “eagerness to do a good job, and learn”.  The company continued by saying it would “like to continue to utilise your labour, however it would have to be on a sub-contractor basis”.  The letter also outlined the hourly rate for becoming an independent contractor.  Judge Simpson said the letter made it clear that the excavator would be dismissed if she did not agree to become an independent contractor.

The director told the employee the day after the dismissal that it was “an ABN or nothing”.  The worker did not ultimately enter into the new contract. 

The construction company was doing exactly what s358 of the Fair Work Act was designed to prevent.

A penalty hearing is to be held at a later date.


Myer’s Recent HR Mess and Lessons for Employers

I think many HR practitioners around the country took interest into the story that broke recently, about the newly appointed Myer executive who was terminated on his first day.  Andrew Flanagan had been appointed to the position of Group General Manager for Strategy & Business Development with Myer.  In simple terms, it appears that Mr Flanagan presented himself as someone who had a specific set of skills based on his experience with another major retail fashion giant, but in reality his skills and experience fell significantly short of what he and one or more of his referees sold Mr Flanagan as having.  The reference checking on Mr Flanagan appeared to have been done by the recruitment company who represented Mr Flanagan to Myer. 

As with many stories in the media, one has to acknowledge that there must have been a little more to this story than what was originally reported, but in the absence of more detail, we can’t help but ask the question “what went so wrong?”   

Generally speaking, when it comes to the process of identifying potential and actual referees on a candidate for a position, here are a few of my tips on the process: 

  1. In the interview process, you can start to put the pieces together of a potential list of referees when you ask the question, “who did you report to in this role and what was their name?”  If the candidate has departed from a business on positive terms then there shouldn’t be too many reasons why they wouldn’t then provide their former manager’s name and contact details as their referee for that role.  If however the name of the referee for a particular period of employment is different to the name you were expecting, then one needs to explore further to find out why; 
  2. When a candidate provides the name of a referee from a previous period of employment, and the contact details do not match those of the specific organisation, one should pursue methods to confirm the details of the referee provided.  For example, a candidate may tell you that they reported to John Smith who was the COO for Such & Such but John is now working as the COO for Sample & Co and his contact details are etc, etc;  
  3. With candidates who have moved to Australia from overseas, I acknowledge the process of making contact with international referees can have its challenges, however one should never resort to emailing a reference check questionnaire to a referee for completion.  This could be anyone that you are emailing it to and even if it is the right person, how much time do you honestly expect a referee will devote to such a process.  The comments are likely to be abbreviated at best, therefore the employer and/or recruiter are unlikely to obtain a detailed picture to make a decision from.  As per the previous point, pursue methods to confirm the accuracy of the referee’s details, and from there, arrange a mutually suitable time to call the referee; 
  4. Never accept a mobile number as the only form of contact for a referee.  Ask for the referee’s landline contact details during business hours if these are not supplied upfront by the candidate; 
  5. Lastly, but by no means least, trust what your gut tells you.  If something doesn’t feel, or sound right when discussing referees with a candidate, this can be a red flag that shouldn’t be ignored.  Investigate it if you think something could be gained from the process, otherwise you need to accept it may be in your best interests to move on and consider other candidates.   

Failure to be thorough in the reference checking process can cause huge consequences for a business, as Myer and the recruitment company involved are both finding out. 

In the case with Myer, Andrew Flanagan has since been charged by the Victorian Police for fraud. 

What is “Reasonable Management Action” under the new bullying jurisdiction?

In a recent ruling by the Fair Work Commission under the new bullying jurisdiction, our industrial umpire has provided a little more guidance for employers on the definition of what is considered to be “reasonable management action”. 

  • Management actions do not need to be perfect or ideal to be considered reasonable;
  • A course of action may still be “reasonable” even if particular steps are not;
  • To be considered reasonable, the action must also be lawful and not be ‘irrational, absurd or ridiculous’;
  • The “actual” action needed to be considered, rather than the applicant’s perception of it; and
  • It might be relevant to consider whether the action involved a significant departure from established policies or procedures, and if so, whether the departure was reasonable in the circumstances. 





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