VANA Employment Relations Alert May 2015

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1 VANA Employment Relations Alert May 2015 Unpaid Work - Are You Engaging in Unlawful Engagements? The VANA Employment Relations team has recently experienced an increase in calls relating to volunteer and unpaid work trials, with many members querying whether or not they can enter into such arrangements. With many students, in particular, seeking to enter the workforce, and concerns being raised openly about worker exploitation, it is important for members to be certain and clear about exactly what their rights and obligations are in regards to unpaid trials, volunteering and vocational work. Unpaid trials Unpaid trials are widespread, with many employers using them as an opportunity to determine the suitability of a particular employee. However, a recent case has highlighted the need for employers to pay an employee for any such trial or risk facing fines or being the subject of a legal claim. Crocmedia, a Melbourne media company, was fined $24,000 for implementing an unpaid work arrangement with two young employees who had approached the company seeking work experience. The pair, who completed a six month and twelve month trial respectively, were characterized by the company as volunteers and were not paid any wages for the duration of their engagement. In deciding that the employees had been underpaid a total of $22,168 in wages, the Court heard from Fair Work Inspectors that the individuals had performed meaningful work for the company, and that the arrangement was not directly linked to their university studies, and therefore that the individuals were employees and not undertaking a vocational placement. In imposing the fine, the Court held that the actions of the Company had been undertaken to avoid paying wages and while it was not deliberate it could be considered exploitative, and not acceptable conduct in Australia s industrial relations scheme. Employment relationship vs. volunteer/unpaid trial? In seeking to determine whether or not you are entering into an employment relationship or a genuine volunteering or vocational placement, members should be considering the following prior to entering into any such engagement:

2 1. Is the person required to perform a role normally carried out by a paid employee? 2. Does your business benefit from the arrangement? 3. Is the person required or expected to perform productive work for your business? If you answer yes to any of the above, it s likely that an employment relationship exists. If not, and the formal arrangement is part of an educational training course (required by the individuals educational institution with documentation to support this) and it is effectively to the employee s benefit (and a learning opportunity), it is most likely a Vocational Placement. Alternatively, in some cases, there may be a genuine volunteer relationship present. The considerations for a genuine volunteering arrangement are: 1. the parties do not intend to create a legally binding employment relationship; 2. the volunteer is under no obligation to attend the workplace or perform work; 3. the volunteer doesn t expect to be paid for their work and are not engaged on a regular roster; or 4. the volunteer is engaged for a not for profit organisation. Members should be cautious to ensure that they are engaging their people in the appropriate manner so as to avoid any sham arrangements and mitigate any liability. For more information on volunteers or unpaid trials, members should contact the VANA Employment Relations Team on

3 Morning Sickness - a Disability in Discrimination Claim The Victorian Civil and Administrative Tribunal ( VCAT ) has held that morning sickness and other pregnancy related symptoms are a disability for the purpose of a discrimination claim under the Equal Opportunity Act 2010 (Vic) ( the Act ). In deciding the matter, the tribunal held that while ordinarily a woman suffering morning sickness would not be considered to be disabled, severe morning sickness (medically known as Hypermesis Gravidarum) is a disability within the definition of the Act, as it is a malfunction of a part of the body. It was therefore accepted that the employee s symptoms, including pregnancy related migraine, back pain, pain in ankles, feet and lower back were a result of a failure of her body to function properly whilst pregnant and therefore her condition fell within the definition. Despite this however, the discrimination claim did not succeed on numerous other grounds. VCAT rejected that the employee s employer had discriminated against her by failing to provide reasonable adjustments to her work following her request in a reduction in hours as any reduction had been on a mere recommendation from her doctor and had not been deemed a medical necessity. The case serves as a reminder of the care which must be taken by employers when determining what, if any, reasonable adjustments are to be made and when approving or refusing various forms of leave. In such circumstances, decisions made can potentially expose employers to not only discrimination complaints under Federal and State legislation, but also general protections claims under the Fair Work Act Members should therefore act with great care and seek advice and assistance if they are uncertain. For more information on parental leave, persona/carer s leave or discrimination and risk, members are invited to contact the VANA Employment Relations Team on

4 Importance of Clear Directions in Performance and Conduct Management The Fair Work Commission ( FWC ) has ordered an employer to pay $9,000 compensation to an employee, after finding that the employer had failed to provide the employee with clear instructions highlighting the need for employers to not only follow a clear process for performance management but also the need to provide clear instructions and articulation of any concerns that are raised. The employee, who lodged an unfair dismissal application with the FWC, had been working on the site run by Clough Downer Joint Venture Construction Pty Ltd for approximately nine months before being dismissed for a systematic breach of safety procedures and policies on the site, including the Golden Rule of not working at heights without fall protection. Whilst Deputy President Asbury of the FWC accepted that the employee had been working unsafely she indicated that the employer had failed to properly conduct a performance management process, had failed to give an opportunity to the employee to respond and had failed to give him clear instructions in relation to his tasks. This case demonstrates again the importance of comprehensive performance management processes. Employees must be given clear instructions and targets to address under-performance or conduct issues, and procedural fairness must be afforded. If members are unsure of how to correctly performance or conduct manage their employees they should contact the VANA Employment Relations Team on

5 Employers Must Pay Employees to Attend any Work Related Activity Whether or not employers are obligated to pay employees to attend work related activities outside of regular working hours has been topical issue amongst members of late. Employers often fall into the trap of assuming that they are not required to pay employees to attend activities such as team meetings, workplace training sessions and/or orientations which fall outside of traditional working hours. Whilst in some instances meetings and/or training exercises an employer expects employees to attend will fall outside a respective employees or agreed hours, in any circumstance where an employer requires an employees attendance for work related purposes (as opposed to any attendance being voluntary), the employee must be paid in accordance with the applicable modern award or enterprise agreement. What does it mean for VANA members? In the past, the Fair Work Ombudsman has pursued and penalised employers and who have consistently failed to pay its employees where they have attended staff meetings and other work related activities. The key principle for members to hold in mind is that unless a meeting or training session for example is completely voluntary and there is no expectation on employees to attend, the employees must be paid for their attendance. This requirement to pay will include any overtime, penalties and loadings that would be payable to a particular employee during the time of the meeting. What must VANA members do? It certain circumstances it can be difficult to assess whether employer has made attendance at meetings/training sessions compulsory, or whether employee attendance was supposed to be voluntary. Given that the requirement to pay employees for such time will turn on how attendance was represented to the employee, it is important that members consider how they designate attendance at the meeting. That is, will attendance compulsory, or is it voluntary and how well has that message been communicated? Members must be aware that any failure to make the intent and requirement to attend clear can result in the requirement to pay employees for time that they were not necessarily needed for. For further information about handling staff meetings or other work related activities which occur outside of traditional working hours, please contact the VANA Employment Relations Team on