Renegotiating Your Contract
When it comes time to renegotiate your contract of employment, you can be faced with both opportunities and risks. It is important to maintain your employment while you negotiate to fairly reflect changed circumstances or improvements in your terms and conditions.
Contract renegotiations are not always formal reviews.
Some take the form of a letter from the employer announcing a change of conditions. Others result from a changed work environment - such as changed staffing levels, changed rosters or changed expectations of overtime. Some contracts build into their terms a process of renegotiation of the conditions of employment. This is quite common, particularly after the first year of employment and often includes a salary review.
Contract reviews
In law everyone has a contract - oral or in writing. Reviews of written contracts are easier as everyone is usually working with the same understanding of the status quo.
Disagreements in contract reviews often centre around items that were agreed at the time of employment but were not reflected in writing - and the recollections of the agreement differ.
In law the changing of contract terms requires offer and acceptance - in the same way as the original contract was formed. Let us say your firm advises you that it will no longer provide the Christmas bonus previously agreed and states that no other recompense will be offered in lieu.
If you say nothing and the firm implements this policy, in law you will have tacitly agreed to the change. If you disagree or seek a form of recompense you will have commenced a process that will either change or protect your prior conditions - and there will probably be some bargaining along the way.
Positive bargaining
Because employment is based upon a relationship between you and your employer, it is important to undertake bargaining in a positive and open manner leading to increased understanding and outcomes which are a win-win for both parties. The obligation to create this environment rests on both parties - no one can do it alone.
The employer has the power over your future employment and needs to exercise this power fairly - some do, some don’t. You need to get to know your employer to make informed judgements about your bargaining tactics and prospects.
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Being well Informed
When entering into bargaining, employers and employees should both be well informed about the legal underpinnings to the terms and conditions of employment, such as statutory provisions, awards etc. and to know the market rates of pay, terms and conditions, and the status of the job market. Otherwise mistakes can be made.
As an employee it helps to be positive and assertive, not aggressive. Employees who are well informed can also avoid areas of unnecessary disagreement with an ill-informed boss. Recent graduates have avoided disputes with their employers about basic entitlements such as annual leave, notice periods etc. by seeking information through APESMA on their legal entitlements.
When the going gets tough, talk to APESMA early
If negotiations are getting tough, employees who wish to protect their ongoing employment should, if appropriate, advise their employer in writing that they are prepared to work to the terms of their pre-existing contract. Employees must be careful not to communicate to their employer that the employment relationship has broken down, otherwise your position may be jeopardised.
APESMA handles unfair dismissals where professionals have proceeded with negotiations without our advice and have found themselves in difficulty. It is better to talk with us before a problem arises.
When you are in the process of negotiations it is important that you take full advantage of your APESMA membership to maximise and protect your position.
Some members seek copies of legislative provisions or award clauses to show their employer, others ask for advice on draft contracts, salary packaging or market rates, others want to talk confidentially to an expert who knows their industry.
Recently a senior employee sought market rate advice as his employer was quoting a particular industry survey about the benefit of the provision of a vehicle as part of a salary package. We gave this member a copy of this same survey - which also included information about his market rate - he got a pleasant surprise, cited the source to his employer and successfully bargained a much improved package.
The key is to get the right advice when you need it and to make well informed judgements when bargaining. As a professional employee you have invested a lot of energy and resources in your career. Satisfy yourself that you have taken all of the necessary steps to maximise your investment.
Designing & Managing Your Contract
Professional employees sometimes ask APESMA for a standard contract of employment. Our response is usually to advise you of the standard features of contracts and then discuss the specific circumstances required in your case. We help you to achieve a unique contract which meets your needs as each contract is different.
Each contract should specify the registered name and business address of the employer and should include as a term of the contract any award which applies.
The amount of detail in a contract will depend on whether an industrial award applies to the work. If so, minimum provisions will apply to many terms and conditions of employment. In this instance it will be important to determine what matters are already covered by the award and to formalise in writing any unique or above award features in your contract.
All contract provisions should exceed minimum entitlements — either award or statutory. Where you are unsure about these provisions, please check with us.
Legislative support for your employment
In addition to awards, basic minimum legal entitlements for all employees are provided through federal and state laws such as superannuation, long service leave, workers compensation. The table below indicates where such laws are present.
If you are not covered by an award, you may need advice on the contents of these provisions when negotiating a contract. Again please contact us for further information.
One example which illustrates the importance of familiarity with legal entitlements is annual leave. A loop-hole in state annual leave legislation is the failure to require accrued annual leave to be paid out on termination. This entitlement should not be taken for granted by award-free staff and should be specified in the employment contract.
