Giving notice of termination to an employee is about to get a whole lot more complicated from 1 January 2010, with the introduction of the Fair Work Act.
Giving notice of termination is about to get a whole lot more complicated. Notice of termination will be required to be provided in writing and a new calculation of what "pay in lieu" means. From 1 January 2010, the schedule of redundancy payments found in most Awards will extend to all employees regardless of seniority or level of remuneration. This means for the first time there will be a legislative entitlement for management personnel to redundancy payments.
The Fair Work Act contains a statutory obligation to consult. If you don't consult employees, then the redundancy will not be seen as genuine and employees will then have access to unfair dismissal provisions. The new laws also mean that for a redundancy to be genuine, an employer must have considered redeployment within the business or within any associated business.
It is also estimated an additional 3 million employees will be entitled to claim unfair dismissal through access to the new federal system. (For more information, view the article, "Impact of Unfair Dismissal Laws on Small Business", YHRM Newsletter Issue 5).
To prepare, employers need to review the way in which underperformers are managed and ensure you have established disciplinary procedures. It's important to update your policies and processes. Clients of Your HRmanager Retained Employer Advisory Service can easily download policy templates on termination and discipline.
Your HRmanager can be contacted for guidance in these areas.