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Hrqs
13-04-2013, 05:47 AM
Hi everyone,

I hope I can find an answer to my question as I have not been able to find it elsewhere on this forum.

I work for an international company that upon starting wasn't as well versed on the National Employment Standards as an Australian employer should be. Some of the offer letters signed by the company and employee on commencement of employment incorrectly had Personal / Carer`s Leave as well as Sick Leave as an entitlement. The sick leave is stated as 10 days per year and the personal / carer's leave is also 10 days per year.

Essentially, this goes above what is required under the NES. They didn't udnerstand that sick leave is included under personal / carer's leave.

What is the employer's option in terms of removing the sick leave as an entitlement to the employees and falling back on the NES minimum requirement of 10 days personal / carer's leave? Is the employer allowed to do this? Or do they have to honour the additional sick leave because it has been agreed upon in the contract?

Thanks

Qld IR Consultant
13-04-2013, 11:05 AM
If they have documented it in letters of offer, which is essentially a part of the total employment contract, then you will find yourself in a bit of strife if you try and take it off them. I can understand the mistake, but its past fixing i'm sorry. Just my opinion of course.......

Cottoneyes
17-04-2013, 08:57 AM
Agree with the above. I would be looking at bringing in a tighter personal leave policy if it is being abused though with more stringent requirements for sick leave certificates or similar.

Change the contracts for all new employees and in around 20 years or so the natural attrition should take care of most of it.

Hrqs
22-05-2013, 01:44 AM
Thanks for your input. Is there any reference to this in the employment legislation and not enabling an employer to reduce the T&Cs back to the minimum requirement?

Tiger
22-05-2013, 11:53 AM
Ok, here is my two cents worth. I would suggest changing your policy immediately so that any new employees starting from now on have these clauses reflecting what is under the NES.
For those employees already there and with the additional leave time in their contracts, there are a couple of options.

1. You could inform them that there will be a transition to the NES over say the next 1, 2 5 (or whatever term you choose) years. This would be an easier pill to swallow than just cutting down the time one. Logically, this could be done at anniversary of hire so would be transitioned over time. Of course, you'd need good documentation and payroll people on the ball.
2. You could allow them to retain whatever their current balances are for this leave so you are not taking away what they have already accrued.
And I'd be issuing new contracts to all those affected to cover whatever it is you decide to do.
I also suggest that in the future, any now current employee who may have a life challenging illness/circumstance (eg cancer), that requires more S/L than they have in kitty, that you look favorably at giving them the additional leave (paid) -- I think a lot of companies may do that already anyhow.

FYI, I have actually done this in the past where I came into two orgs in a similar situation. One related to sick leave and the other Long Service Leave. There was a cut off date (detailed in new policy) of the old and start of the new; whatever they had remained and it all went remarkably smoothly and both included blue collar workforces.

The thing to remember with the PC/Sick Leave, it is not paid out at the end of employment like A/L and LSL so you should have a chat with your finance leader and assess what impact the costs are having if you leave things they way they are.

Finally, whatever you decide to do, remember there should be lots and lots of communications (fae to face) with people about what and why. In the current not so great business climate which I'm hearing we may have for another couple of years at least, people are generally very aware and would much rather retain their jobs if it means losing some privileges.
Good Luck
Tiger

Hrqs
23-05-2013, 01:08 AM
Tiger, thanks for your detailed advice. My concern that is if we took your approach an employee could take action against us as essentially we are changing part of their employment contract in which they could say impacted their decision to accepting the position.
Did you receive legal advice when you implemented the changes in your organization?
All contracts going forward go by the NES and don't give leave conditions over and above this.
Thanks

Tiger
23-05-2013, 11:06 AM
Yes I did. The circumstances in both cases were, frankly, economic. Both companies, in different ways, were relics of the past which required heaps of change to bring them into the 21st century to be able to continue operating.

The response was pretty good but, as I've mentioned before, we did heaps of face to face communicating so everyone understood the why. The fact that we were not taking anything away from what they'd already accrued, was reassuring. For the odd few who were not happy, they came around after, I suspect, they did their homework and compared notes with their mates.
For those who rarely took it was hardly a ripple; there were only a handful of employees who abused the privilege who had very low to no balance(s) at the time. We went so far as to examine leave patterns and took those individuals aside for a little chat about excessive leave. On a lighter note, we found one of those had a job on Tuesdays in the local supermarket!!
As to changing employment contracts, this has occured any number of times in several orgs I've been with - called variations of employment so each time there was any change, a new (shorter version than the original) was offered. These variations could be about anything - promotions, location changes, allowance changes, policy changes (as in the situation we are talking about), reduction of working hours (during the GFC - that org avoided redundancies as a result), etc.
There are still many older organizations out there who've not had the benefit of HR advice who have either none or poorly constructed employment contracts. Enter HR and this is often the first thing identified needing to be remedied and employees receive a new contract (in some cases their first).
Every organization is different, you have to look at your culture, industry type, size, what industrial instruments cover your workforce, union involvement, maybe even look at what your competitors are doing if you can, etc. Any process of change needs to be carefully planned and executed and it can help to select a few of your "unofficial" leaders to help carry the message.
I'm assuming you've had the conversation with your finance people about just what kind of savings to your business, this will result in? As this leave is not paid out at termination, it will be more about your accrual costs. Of course, you also need to be considering any other reasons you want to make this change eg you have high absenteeism levels? If that is a big reason, then I'd be starting to manage this. That is, have the tough conversations with people who you think are abusing the privelege. It is really tough on co-workers of people who constantly take sick leave for, apparently, no good reason (thanks to Facebook, they know when a colleague doesn't show up on a Monday because he partied too hard on the weekend - they are left to pick up the slack and it leads to morale issues if not dealt with. Ensure your policy covers the taking of such leave before and after weekends, holidays etc and look for other patterns. I'm a believer in providing leave reports to managers so they remain on top of what is happening with their staff so they can manage their people effectively.
I trust this is some help to you
Tiger