Redundacy after issuing a new employment contract

[Squid]

Hi Everyone,

Are there any laws in place within Australia limiting the time frame between issuing a new employment contract and making the employee redundant? We are thinking about changing our employment contracts to include detailed KPI's/ STI's and also a CPI wage increase each year. However we also believe that there may be some volatile times ahead >6 months and need to make sure that we can still give employees genuine redundancies in the event we need to.

Any feedback will be appreciated.

[Tasman McManis]

Hi Everyone,

Are there any laws in place within Australia limiting the time frame between issuing a new employment contract and making the employee redundant? We are thinking about changing our employment contracts to include detailed KPI's/ STI's and also a CPI wage increase each year. However we also believe that there may be some volatile times ahead >6 months and need to make sure that we can still give employees genuine redundancies in the event we need to.

Any feedback will be appreciated.

Hi Squid

"changing our employment contracts to include detailed KPI's/ STI's and also a CPI wage increase each year"

When setting up contracts of employment it is strongly recommended that KPI's and anything relating to variable pay is NOT included in a contract of employment. They can be referred to but details should be captured in a separate document that has the flexibility to allow the organisation to change it as it wishes and only run it as a year to year proposition.

KPI's, STI's, CPI and wage increases vary from year to year and you don't want to be issuing Contracts of Employment on a yearly basis. It is best to set up a structure that provides the organisation with flexibility.

[bullswool]

Hi, sorry for late reply.
I would suggest that there is no minimum time frame with regards to offering redundancies in the event that you are issuing new contracts. I feel that it would not hold up with Fair Work, if you issued amended contracts and then denied redundancy payments immediately after.

I would even go as far to say that the new/amended contracts should contain a clause that states something like "Continuity of Service: the company acknowledges that your employment commenced on XXXXdate and recognizes service from this date for all service related entitlements".