While managing your manufacturing and logistics business, you will encounter issues and situations requiring you to know your obligations under employment law. This article will take you through the essentials of employment law for your manufacturing and logistics business. It will explore the basics of setting up an employment agreement, the minimum standards for hours and pay, leave and flexible working arrangements, and the basics of workplace health and safety.
Employment Agreements
An employment agreement stipulates your expectations for your employees and details your responsibilities towards them. For this reason, you must create an employment agreement that fits you and your employee’s relationship.
A clear employment contract is crucial to meeting your employment law obligations in Australia. Engaging a qualified employment lawyer can assist you with drafting the contract to limit your liability.
Hours and Pay
Hours
Employees can only legally work 38 hours per week unless additional hours are reasonable. These 38 hours include leave that you have authorised.
If you need your employees to work additional hours, their additional hours must be reasonable. Additionally, if a modern award covers your employees, you may be required to pay overtime rates. Overtime may be payable when an employee works over a specific number of hours, for example:
- 38 in a week or 76 in a fortnight; or
- when they work outside the span of hours, for instance, outside 7:00 am and 7:00 pm.
When deciding whether the hours are reasonable, consider the following:
- whether the extra hours are necessary for your business to function;
- your employee’s personal circumstances, such as their family commitments;
- whether they will receive overtime pay;
- if you have given the employee enough notice to require them to work extra hours and whether they have given you notice of their inability to work extra hours;
- if their role is relevant to the extra hours, as well as their seniority and responsibility to the company;
- whether employees with similar roles in other companies are also required to work such hours;
- whether the extra hours violate what you have agreed to in their employment agreement; and
- the risk posed to the employee’s health and safety by imposing additional hours and work. This will be especially relevant if you have employees involved in physical labour as part of the manufacturing process.
Leave
As an employer, you must provide your employees with leave entitlements in accordance with the Fair Work Act 2009 (Cth). In some circumstances, you may offer employees additional leave benefits and set them out in their employment agreements or a policy. Below are some forms of leave that you should note.
Parental Leave
Employees are eligible for unpaid parental leave if they have worked with you for 12 months before the birth or adoption of their child or when their leave starts. They must provide you with notice beforehand. Employees can access up to 24 months of unpaid parental leave, either in a continuous period or in a flexible manner that allows them to take leave when needed.
Annual Leave
Full and part-time employees are entitled to paid annual leave. Full-time employees can receive 20 days of annual leave each year. Part-time employees are entitled to a pro-rated amount of leave based on their ordinary hours of work.
Annual leave accumulates each year, and your business must pay any unused annual leave if a worker terminates their employment. Some employees may be entitled to annual leave loading under a modern award (usually a 17.5% loading).
Other Forms of Leave
There are several other forms of leave that your employees may be entitled to:
- personal/carers leave, being 10 paid days a year for full-time employees (pro-rated for part-time employees);
- long service leave, which depends on the state or territory your manufacturing and logistics business is located;
- paid family and domestic violence leave; and
- compassionate leave.
Flexible Work Arrangements
Some of your employees can request flexible working arrangements. They can do so for several reasons, including:
- pregnancy;
- parental/carer responsibilities;
- disability;
- age; or
- family/domestic violence.
These arrangements could be job-sharing arrangements, working from home or modified hours.
You are only required to grant arrangements that are practical for the employee’s role and for your business. For example, a factory worker whose job primarily involves physically moving items around could not practically do their job when working from home. You can decline proposed arrangements that are not practical if you have discussed the employee’s request and have tried to compromise so that both of your needs are met.
Workplace Health and Safety
Working in manufacturing and logistics can pose certain hazards that endanger your employees. Whether it be injury from moving heavy items or misuse of equipment leading to danger for your employees, you must have plans to minimise risk and manage hazardous incidents when they arise.
In the manufacturing and logistics industry, your business is particularly vulnerable to health and safety risks, and you open yourself up to legal action where you are negligent in preventing health and safety incidents.
As an employer, it is essential to understand what employment laws have changed and their implications for your business — particularly the changes to the Fair Work Act 2009 through the new Closing the Loopholes legislation.
Key Takeaways
The employees of your manufacturing and logistics business have certain rights that you must uphold in the course of their employment. Key employment law essentials for your manufacturing and logistics business include:
- drafting a comprehensive employment agreement;
- paying your employees correctly and not forcing them to work more than is reasonable;
- providing your employees with legal leave entitlements;
- facilitating flexible working arrangements if practical;
- complying with workplace health and safety laws.
If you need help managing your employment law obligations in the manufacturing industry, our experienced manufacturing and logistic lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers who can answer your questions and draft and review your documents. Call us today at 1300 544 755 or visit our membership page.
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