As a non-profit director, it is essential to understand and apply Australian employment law correctly. Critically, a lack of adequate planning can result in failing to satisfy the myriad of duties imposed on you. Not-for-profit organisations have the same obligations as any other employer, primarily found in the Fair Work Act 2009. In addition, every state and territory has laws relating to community organisations. This article will highlight critical issues to consider when hiring and managing employees at your non-profit business.
Deciding on a Worker’s Status
As a non-profit organisation, you will typically rely on three main worker categories, being employees, contractors and volunteers. However, it can be difficult to distinguish between them.
Generally, an employee:
- will engage in ongoing work under your or another manager’s supervision;
- cannot delegate their work to outsiders; and
- is paid regularly for time worked.
On the other hand, a contractor has no obligation to your organisation beyond the contract made with them. They are often able to delegate work to others. Alternatively, volunteers provide their services without an enforceable right to receive payment for their services.
National Employment Standards
The national employment standards (NES) will apply to your organisation if it meets the definition of a national system employer based on the specific laws in your state.
Typically, a national system employer is:
- a constitutional corporation that usually employs individuals;
- the Commonwealth when it employs individuals; or
- a Commonwealth authority.
Once you have confirmed that an employer-employee situation exists, you should familiarise yourself with the NES. These standards include leave entitlements, such as annual and parental leave.
You must provide employees with a copy of the Fair Work Information Statement that explains their guaranteed entitlements before or at a reasonable time after hiring them. You must provide casual employees with a copy of the Casual Employment Information Statement, which is a separate document outlining their rights.
Continue reading this article below the formAwards and Enterprise Agreements
The minimum entitlements that you owe to your employees will be included in their specific modern award. As there are over 100 awards, it is important that you apply the most suitable one. One way to find the right award for your organisation is to read the coverage clause, usually clause four. For example, the Children’s Services Award states that it covers “employers throughout Australia in the children’s services and early childhood education industry”. If you still struggle to find a relevant industry award, then the Miscellaneous Award will likely cover your employees.
If you would like to negotiate entitlements with your employees, you can do so through individual contracts or a registered enterprise agreement that applies to all of your employees. You can pay your employees whatever you want, as long as it is not below the legal entitlements in modern awards. An award contains minimum pay rates and usually extends to apprentices, trainees and labour-hire employees, so interpreting it correctly is essential.
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.
Work Health and Safety
Work health and safety (WHS) legislation states that employers have a duty of care to take reasonable precautions to avoid exposing employees to unreasonable risks of injury. Fortunately, most states and territories have enacted harmonised laws that set out your work health and safety responsibilities.
The steps to ensure work health and safety vary based on the circumstances. It is crucial to consider the likelihood of a hazard and the degree of harm, including psychological harm, that might result from it. A high magnitude of harm typically calls for a more robust protective response.
With charities, injuries sometimes arise from handling heavy objects or moving furniture. To provide a workplace free of health and safety incidents, you may consider:
- implementing adequate training and hire qualified staff;
- conducting regular safety audits and promptly rectifying any identified risks;
- consulting regularly with staff to help identify threats; and
- checking that your complaints procedure is adequate for detecting problems.
A board member can be found personally liable for failing to abide by a health and safety duty. However, an exception applies to volunteer board members.
Guarding against Discrimination
All aspects of the recruitment, onboarding, discipline, promotion and termination process must be free from discrimination. Discrimination based on protected attributes such as race, age, or sexuality is generally not allowed. For example, you cannot take adverse action based on age unless age is a necessary job requirement. Adverse action includes, but is not limited to:
- firing an employee;
- changing an employee’s job to their disadvantage; and
- not hiring someone.
One way to prevent discrimination is to establish processes and criteria for hiring, evaluating, and making career decisions. This ensures that decisions are based on merit rather than personal biases. Additionally, education programs help staff understand the importance of merit-based choices and the negative impacts of discrimination.
Another helpful tactic is fostering a culture of diversity and inclusion by recognising staff achievements and appropriate cultural traditions. This can help your employees feel valued and respected, regardless of their personal characteristics.
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
As a non-profit employer, you have a duty to act in good faith and for a proper purpose when hiring and managing staff. You should consider the law and best practice guidelines around recruitment, onboarding, work health and safety and equal opportunity. Having internal policies to address the employer-employee relationship will ensure that your non-profit organisation runs smoothly.
If you would like assistance with employment law for the non-profit sector, our experienced employment lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.
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