Lecture Fundamentals of business law (4th): Chapter 21 - Margaret L. Barron, Richard J.A. Fletcher

Chapter 21 - Employment Law. At the end of this chapter you should understand: the remedies available to an employee arising from the termination of employment, the operation of the statutory unfair dismissal jurisdictions and their interrelationship with common-law principles of employment law, the liability of an employer to third parties for torts and crimes committed by employees,...

This is the prescribed textbook for your course.

Available NOW at your campus bookstore!

Employment law

Chapter 21

• Public Service Act 1922 (Cwlth)

protects employees from changes

in government by ensuring political impatiability.

Employer-employee

relationship

• Control Test - Nature

- Degree of control able to be exercised by

a person over the manner in which the work is to be

performed by another.

• Delegation Test - Discretion of service provider to

delegate work to another party.

• Business Test - Commercial factors showing whether

working on own account or for someone else.

• Integration Test - Is work being performed on integral

part of the business operation of the person engaging the services of the worker?

• Pragmatic Test

• Deduction of PAYG income tax

• Use of business name or business structure

• The ratio of money spent to money earned after deduction of expenses

• Whether invoices are required to be submitted prior to

payment

• The responsibility for losses or for rectifying errors or

mistakes in the quality of work done

• The freedom to work for other people

• Whether the work is simply an identifiable job for a specified

• Employee

• Independent Contractor - Contracts for service

• Agent - Person who makes a contract on behalf of

another with a third party.

If employee (substance), statutory compliance required

including:

– Income tax laws

– Superannuation guarantee laws

– Workers’ compensation laws

– Payroll tax laws

– Workplace regulations taxation

– Occupational health and safety laws

Contractors have protection against

unfair protects

Workplace Relations Act 1996 (Cwlth)

• S127A, 127B and 127C: Allows protection

to contractors with respect to contracts that are unfair, harsh or unconscionable, or

against the “public interest”.

Trade Practices Act 1974 (Cwlth)

• S51AC: Unconscionable conduct in

business transactions.

• S51AD: Industry codes to be mandatory.

Outsourcing/contracting out

EMPLOYEE Contract of

Service Labour Payment

LAND HIRE COMPANY

Supply Payment Labour

BUSINESS

Formation of the Employment

Contract

• Intention to create legal relations

• Offer and acceptance

Terms of the Employment

Terms of the Employment Contract

• To ensure safety of employees

By the Workplace Relations System:

Workplace Relations Act 1996 (Cwlth) Annual Holidays Act 1994

Terms of the Employment Contract - employee’s duty

Implied terms (from circumstance of offer and acceptance):

• To work in a skilful and competent manner, and to exercise reasonable care.

• To obey an employer’s lawful and reasonable commands (a command by the employer that exposes an employee to an unreasonable risk of injury is not a lawful command).

• To provide faithful service (also known as the duty of fidelity).

• To not prejudice an employer’s interests or act in a manner hostile to the

employer’s interests.

• To maintain confidentiality after termination of the contract (e.g not to

disclose trade secrets).

• To account for moneys and property received on behalf of the employer.

• To hand over inventions made during the course of employment.

• To disclose to an employer information relevant to the business of the

employer.

By the Workplace Relations System:

Workplace Relations Act 1996 (Cwlth) Annual Holidays Act 1994

Terms of the Employment

Contract

By Industrial Bodies

eg Australian Industrial Relations Commission

Minimum mandatory standards:

Lawful termination of Employment

Contract

• Termination by death

• Termination by the dissolution or bankruptcy of the employer

• Termination by sale of business by the employer

• Termination by frustration of contract

• Termination by abandonment of contract

• Termination by breach of contract

• Termination by notice

• Termination without notice

• Redundancy

• Suspension by employees

Unlawful termination of

employment

• Dismissals prohibited by law

• Unfair dismissals: Unfair dismissal is assessed

as being “harsh, unjust or unreasonable”

Assessment based on objective analysis of all circumstances applicable to employer and

employee, using “reasonable person test”:

- reason for dismissal

- procedural fairness (using concept of “a fair go all round”)

• Constructive dismissals

Remedies for unfair dismissals (via legislation)

Employee:

• re-employed in the same position

• re-employed in an alternative position

• paid an amount of compensation.

Remedies for breach of the

Remedies for breach of the

Employment Contract

Employee’s remedies

• Resignation

• Damages

• Injunctions and specific performance

• Unfair dismissal proceedings

• Unlawful termination

• Claims for sums due

• Orders by an industrial tribunal

Liabilities and rights of employers and

employees to third parties

Vicarious Liability

• Employer is liable to a third party for negligent acts or omissions of

an employee, carried out in the course of employment, where these acts or omissions cause loss or damage to a third party.

Liability for Contracts

• Employer is liable for contracts entered into by an employee as

agent of employer.

• Employee liable for contracts if act outside of authority given by

employer.

Liability for Criminal Acts

• Criminal acts of employee conducted in course of employment in strict liability cases without intention to commit the act results in

vicarious liability

– Employer liable - where at direction of employer.

– Employee liable - no employer direction but intention to commit the acts.

Statutory regulation of employment relationship

• Worker’s compensation

• Occupational Health and Safety

• Anti-discrimination and equal

opportunity

• Occupational superannuation

• Workplace privacy

Worker’s compensation

(Federal and State legislation)

• Provides wage and salary

maintenance and prescribed benefits for injured workers

e.g Pensions

Lump sums

• Weekly benefits for initial period

• Medical and hospital benefits are covered.

• Economic and non-economic losses

• Retirement provisions

Rehabilitation and return to work obligations

• Common Law Access: Dependant on relevant legislation.

Occupational Health and

Safety

• Employer and employee duties

• Risk identification and codes of

practice

• Sanctions and enforcement

Anti-discrimination and equal

opportunity legislation

• Human Rights and Equal Opportunity

Commission Act 1986

• Affirmative Action (Equal Employment

Opportunity for Women) Act 1986

• Racial Discrimination Act 1975

• Sex Discrimination Act 1984

• Disability Discrimination Act 1992

• Workplace Relations Act 1992

• Workplace Relations Act 1996

Anti-discrimination and equal

Anti-discrimination and equal

opportunity legislation

Complaints and disputes

• Conciliation resolution at disputes

Tribunal

Anti-discrimination and equal

opportunity legislation

Affirmative action

Affirmative Action (Equal Employment

Opportunity for Women) Act 1986 (Cwlth)

For employers with 100 or more employees:

• To ensure appropriate action to eliminate discrimination by employers against women

in relation to employment matters.

• Measures to promote equal opportunity for women in employment matters.

Anti-discrimination and equal

opportunity legislation

Sexual harassment

Sex Discrimination Act 1984 (Cwlth)

• One person subjects the other to an

unsolicited and unwelcome act of sexual conduct or physical intimacy in

circumstances where the other person has reasonable grounds to feel offended,

humiliated or embarrassed

Anti-discrimination and equal

opportunity legislation

Occupational superannuation

• To fund and maintain living standards for an

ageing population in the future

• Requires employers to make superannuation contributions on behalf of their employees at a prescribed percentage of the employee’s wage

or salary, as defined by the legislation, to a

complying fund.

• Rate: 2000-01 8% 2002-03 9%

• Penalties for non-compliance: Non taxable