Each year generally sees new and amended employment legislation and changes. This year is no exception, with changes to wages coming into effect on 1 April. It is good practice to review and update all your employment agreements at this time each year.
One of the practices I most commonly see is employers giving their people an addendum to their employment agreement to reflect new changes. While this is an acceptable practice, it does have its flaws:
- Over time the core employment agreement becomes out of date
- Employment terms are recorded across multiple documents
- Confusion about which documents are the most valid.
Reviewing and updating your core employment agreement each year will ensure all terms of employment are up to date and align with current legislation.
Another practice I’ve observed is the tendency to download templates off the internet or ‘borrow’ one from a friend. Your employment agreements should always be tailor-made to your business and your industry. When employers simply use a templated employment agreement, they run the risk of having clauses that put them at risk when they have employment issues like investigations, disciplinary meetings, redundancy, or termination.
A good example is where you may have hired staff with highly sought-after specialist skills. You want to ensure that there is a restraint of trade or non-complete clause that protects your IP, business systems and processes, and your people. The last thing you want is someone walking out the door with any one (or all) of these!
Notice periods in downloaded agreements catch people out all the time. I once came across an employment agreement for a GM role and the notice period was one week! The employer was significantly exposed when he chose to move on – there was no time for a complete handover or time to find and onboard a replacement.
It may seem a major exercise to update everyone’s employment agreements around this time, but it is worth doing as it will help keep your business safe from risk.
If you are unsure of where to start, please get in touch with us. We can get together to better understand your business, its various roles and ensure you are protected should you find yourself in an employment dispute.