Over the course of about 18 months this small Professional Services firm put up with mediocre performance from one of its managers.  And whilst there were discussions about performance they were too informal.  They lacked any real sense of consequence and there was no record or documentation to support the decision to terminate. As a result, an unfair dismissal claim was lodged and an arbitration hearing set with a commissioner. It became clear that although the dismissal was probably reasonable it was harsh simply because they did not follow due process.  In order to settle, the company negotiated a further severance on top of its original termination package.  Because the firm and the directors took a “too soft” approach to managing performance it cost them dearly. Approximately $23,000 in severance pay, legal and consulting fees. On top of this; an unproductive employee, lost revenue, damaged reputation, and countless hours of time that could have been better invested in looking after clients.

Here are the common mistakes we see all too often

-          Performance discussions are  “too soft”
-          Have not conveyed your expectations.
-          Haven’t put a time frame for improvement
-          Have not documented each conversation.
-          Did not give the employee a chance to respond.
-          Did not use verbal and written warnings. 

Performance management is about feedback on an individual’s goals and objectives.  If you are having a corrective discussion it means they aren’t meeting your expectations.   It’s time to have full and frank discussions about what has gone wrong, what needs to change, what training or support they require and a time frame to get the issues back on track.  If their performance does not improve then you need to consider the process of delivering verbal and or written warnings.  These must convey that the expectations are not being delivered and without improvement their position in the company could be reviewed.  
While the process is simple every employee in every situation is unique. So, before you put yourself in a position that may give rise to an unfair dismissal give us a call and we can walk through with you a strategy to stay out of trouble.

Epilogue:  this is what the help desk put together for this client: after the fact……  Installed a new performance management system, set up a quarterly goal setting process, a new appraisal system and one on one support in delivering feedback. 

For help with performance management give one of our HR Help Desk Advisors a call on 1300 624 654

2.       An employee says that everyone in the same organization is covered by the same award, is that correct?

No, the award coverage will differ from person to person and from industry to industry. It is important that every employer/employee knows which Modern award and level they are classified on.

3.       Does every organization need an Employee Policy Manual?

Regardless of the size of your business, the Employee Policy Manual is an essential tool that communicates your company rules and expectations to employees. The Employee Policy Manual is created to ensure consistency and to establish methods that the employer will use to address an array of issues. A good Employee Policy Manual will not only cover issues like dress code and internet usage, but will address the more important issues of employment, health and safety in the workplace and employee theft.   

 4.       Is it okay to use the same job description for most of my employees?

Yes , it is okay if they have a similar role . However, if they have different responsibilities/KPIs/Role title they need a separate job description.
The job description needs to communicate clearly and concisely what responsibilities and tasks the job entails and to indicate, as well, the key qualifications of the job the basic requirements and, the Key Performance Indicators. 

 5.       I can’t find the right people for my business, where should I advertise?

This depends entirely on the role and the type of person your looking for.The HR HelpDesk can assist you in finding the right person, using our Recruitment Options Menu , you can choose the level of support required for your business.

To discuss your recruitment needs call on 1300 624 654

Infringement notices may be issued if an employer does not :

• Make and keep employee records for seven years
• Include the information required for employee records
• Issue pay slips to employees within one working day of paying an amount
• Include the information required for pay slips

These record-keeping and pay slip obligations ensure that accurate records are kept so that Fair Work Inspectors can check that the correct pay,leave and conditions are being recieved.
In summary ,in between employees lodging unfair dismissal claims and Fair Work Inspectors making educational visits, there is plenty of reason to ensure that your organisation is compliant with the Fair Work and National Employment Standards.For a compliance health check give one of our HR Help Desk advisors a call on 1300 624 654

 1. The Essentials

·         Know your people and understanding their ability to cope with change in your business processes.  Create a sense of urgency so that everyone understands why the changes, the policies are vital.

·         Set priorities and clear goals: insist on realism by ensuring they are SMART: specific, measureable, achievable, realistic and time framed.

·         Follow up and follow through.  Provide feedback, and correct poor procedure or bad behavior immediately.

·         Reward the doers actively look for people doing the right things.

·         Expand people’s capabilities.  Move from priority to priority but only after you have successfully launched deployed and demonstrated success.

·         Know yourself.  What style of leadership should you be adopting in order to support the change…..are you a walking role model.  

2. Creating the framework for cultural change

Making a change in a strategy or structure will only take a company so far.  Give your people the context of why decisions are made and the direction you are taking.  Reinforce the values or beliefs that create your culture and the behaviors you hold everyone, including yourself accountable to.

3.Ensure that you have the right people in the right place.

Managers need to be committed and engaged to both their recruitment and performance management process.   Choosing new team members based on a strong fit of skills competencies and cultural fit is vital: if they don’t seem to be a good fit at interview they generally won’t be a good fit once aboard.  Managing performance is about setting clear expectations and then providing the tools to meet them. 

Life is not black and white, the policies guide an organization with where they need to be at, they can be seen as strategic objectives for the organization, however the foundation of putting these policies to work, is by making the right moves.

“Unless you can make it happen, it’s not going to matter”

v  Here is a summary on the changes :- 

·  The scheme will provide up to 18 weeks Parental Leave pay at the National Minimum Wage ($570 a week before tax from 1 July 2010) for eligible parents of children born or adopted on or after 1 January 2011.

 ·  From the 1 October 2010 claims can be lodged by parents (up to three months in advance of the expected birth or adoption).

 ·  As  of the 1 July 2011: Employers will be responsible for providing Parental Leave pay to their long term employees (i.e. those with 12 months service with their employer).  

v  Parents may be eligible if they:   

·         Are the mother of a newborn child or are the initial primary carer of a recently adopted child

·         Have met the Paid Parental Leave work test before the birth or adoption occurs

·         Have an individual income of up to $150,000 in the previous financial year, and

·         Are an Australian resident

·         Paid Parental Leave can be transferred to another primary carer, if eligible.

v  The Paid Parental Leave work test will be met if a parent:  

 ·         worked continuously for at least 10 of the 13 months prior to the birth or adoption of their child, and 

·         worked at least 330 hours in that 10 month period (just over one day per week), and had to more than an eight week unpaid break between working days.

Here are some tips for making the conversation easier: 

1. Describe the behavior that is concerning you objectively

2. Express how you feel about it

3. Specify the behavior you want

4. State the consequences

Some more hints include:

• Timing is important - say what you want to say when it is an issue, but consider whether the other person is best able to receive the information.
• Always start with a positive comment if you can. Most people immediately go on the defensive (and stop listening) if you start on a negative or critical note.
• Be mindful of what you are saying.
• Describe behaviour in neutral terms - avoid emotionally loaded words like “appalling, disgraceful”.
• Feelings should be expressed as ‘/’, not ‘you’. Keep it simple
• Specify what changes you want rather than negatives or criticisms
• Consequences can be negative or positive, be positive wherever possible. Negative consequences are often threats.
• Avoid statements that are impossible or unenforceable.

Are you paying  your staff correctly?  From 1 July 2010 the national minimum wage has increased.  Here is the overview:

1. The national minimum wage replaces the Federal Minimum Wage.

2. From the first full pay period on or after 1 July 2010 the national minimum wage is $569.90 per week (before tax), or $15 per hour (as rounded to the nearest 10 cents).

3. Before the first full pay period on or after 1 July 2010, employees covered by the national minimum wage are entitled to be paid at least the previous Federal Minimum Wage rate of $543.78 per week or $14.31 per hour (before tax).

4. Casual employees who are entitled to the national minimum wage are also entitled to a casual loading. From the first full pay period on or after 1 July 2010 the minimum casual loading for these employees is 21%.

Make sure your on top of your obligations and call us on 1300 624 654 for any assistance.

The largest recovery was $25,000 for a Leppington storeman who was underpaid his minimum hourly rate, pay in lieu of notice and annual leave entitlements.  In a separate case, a Blacktown tradesman has been reimbursed $17,000 after he was underpaid his minimum hourly rate, penalty rates for overtime and tool and travel allowances.

Further similar cases were reported in Bella Vista, Granville, Paramatta, Blacktown, Harris Park, Blacktown, Engadine, St Mary’s, Breakfast Point, Enfield, Guildford, Oakhurst and Rouse Hill. Fair Work inspectors discovered the underpayments through a combination of routine audits and investigations into complaints from workers.

Common non-compliance issues encountered by inspectors include underpayment of workers’ minimum hourly rates, penalty rates and failure to pay full entitlements to workers on termination of their employment.

These cases are becomming more and more frequent and certainly highlight the lack of understanding of the detail in awards.  Don’t get caught out with potentially huge bills to pay and stay on top of your obligations. For help, contact HR Help Desk Australia on 1300 624 654.

One hundred NSW small and mid-sized businesses from a cross section of industries were invited to participate in the online survey, with thirty providing us with feedback. 

Interestingly, approximately one third of those that completed the survey were expecting substantial improvement in their businesses performance, with another third expecting some improvement.  The remaining third were either expecting no change when compared to the past year or expressed a gloomy outlook that this year would actually be tougher.

When asked about top priorities for their business, 79% of respondents were focussed on sales, whilst 50% saw the need to improve processes and systems.  A large number of the sample wanted a better marketing plan and several business owners expressed a need to free up more time for themselves and to get their teams focussed on business goals.

As David Boyd, an expert strategic planner and director of Benchstrength, commented “It was pleasing to see business owners displaying a return to thinking about customers and how to generate more revenue instead of shedding costs as many were forced to do over the past 18 months.  Being in business is about enjoying the satisfaction of success which can only come from making the sales that generate profits.” “Improving systems and a better performing marketing plan is about finding new ways to be more productive and to exploit the opportunities out there in the market.  Tighten up your game, spend wisely, use sharper strategies, focus resources to improve service to your existing customers, and direct your marketing to gain new ones.   In short it’s time to pull out of the defensive mode and exploit weaknesses in the opposition.  It’s time to go on the attack.”

The survey was also interested in business owners’ attitudes towards people issues in the post-GFC climate.   The results indicated that the top ranked priorities were:

1.       Developing and training staff
2.       Putting policies and procedures in place
3.       Developing a performance management system
4.       Finding good staff
5.       Restructuring the team.   

Mr. Boyd commented “developing your team is absolutely critical as the economy picks up .  A key problem for many will be a return to the challenge of keeping and finding good people in a fuller employment economy.  Your best plans are useless unless your people can execute them with precision and this means investing in your people.” 

Individualised training and development programmes to build skills and competencies, policies and procedures which outline the rules and the boundaries, and finally a performance management system which cascades responsibilities are all key to retaining your best people.   You team needs to understand who does what, why and how they contribute and they need to know what behaviour gives the best results for all.    Performance management is a particular problem for many organisations.  Most don’t have good systems to cascade responsibility down to the team and when it comes to holding people accountable many don’t know how to give feedback or don’t follow due process when there are performance issues.  Performance needs to be managed as it is the only way to keep your team focused on your goals. 

The survey also wanted to understand attitudes and action towards the new employment legislation introduced over the past year.  75% of respondents said they were aware of the introduction of the new Fair Work Act but the majority hadn’t done anything about it.   

“Being compliant is not difficult and ignoring the new act leaves businesses exposed.  You only need to see the number of inspections by Fair Work resulting in fines to see the risk.”

Mr Boyd commended those leaders who have made changes to policies, procedures and contracts as well as ensured they are meeting their obligations under relevant awards.  “They will have little to be concerned about when the inspectors come for a visit. These new laws should not be feared but seen as the opportunity to tidy up some lazy processes.  Doing nothing however is not smart.”

“Some are actually assuming the new Fair Work Act doesn’t affect them which is not correct and is a dangerous assumption to be making.  These new laws impact every business in Australia.  One key issue we see frequently are instances of the new performance management processes for small business not being followed and the result is that unfair dismissals are on the rise.” 

Lastly we asked business owners about where they get help and guidance when it comes to HR issues.   Most go to a lawyer, or figure it out for themselves.   Mr. Boyd’s advice is that business leaders should seek professional HR guidance.  “Just as you would go to your lawyer with a legal problem or your accountant with a tax issue, you should be enlisting support from a qualified HR professional when you have people challenges.  Also doing it yourself unless you have the detailed knowledge to get it done, can be a very unwise use of your time.  There are other priorities like more sales, better marketing, improved systems and well trained people.”

What truly needs to be kept in perspective though is not to fear the changes but rather use them to tidy up some lazy and sloppy practices and at the same time build an HR system that can help you run your business.  It begins with a coherent and cohesive strategy however it is of little use if your people are ineffective in making it happen. The principles across large and small business in accomplishing great things starts with aligning your people to your goals, your strategy, your vision.  It is critical for all employees to understand their role, how they contribute and what they are being held responsible for. 

Contracts and job descriptions, when written properly, document ownership and accountability. Policy and procedures mark out the rules, boundaries and the behaviours in your business. Successful businesses know they need to constantly adapt, improve and innovate before the competition does. So in thinking about the Fair work Act think as well about your people their needs, your business needs and the new employment laws. Applied well can give you the competitive advantage you need. 

Lets start with basics:

1. First, make sure your current employment contracts comply with the New Employment Standards and the modern awards.
2. Have a good look at your policies and procedures: make sure they reflect your business needs?
3. Ensure job descriptions are up to date, include key performance indicators and the skills and competencies necessary to be successful.
4. Analyse your people, their abilities and capabilities, how do they compare with your job descriptions.  

You will then have a sense of how strong the alignment is between your business needs and the talent that exists in your business. You should know who your star performers are and a picture of where you are vulnerable or weak. This analysis gives you data about your business and your workforce in order to make better decisions. Now armed, you can open up discussions with each employee, cover off the basics of the new employment laws and then turn your attention to growing their capabilities in tune with their roles, their aspirations and the business.

It’s here you may discover that some of the new provisions in the Fair Work Act may in fact assist your business plans for growth. Retaining good staff and their expertise will become a critical issue as we head out of the GFC in 2010. For example applying extended parental leave and flexible working arrangements in a strategic way will enable you to comply with the standards and position your business for the future: if it’s the right thing for the employee and for the business.

Lastly communicating across your business is critical to ensure clarity, a smooth transition and to minimise disruption. Keeping everyone informed about strategy, goals, action plans, employment laws can help you to get on with running the business and not get tied up with compliance for compliance sake.

Don’t procrastinate, ensuring that the standards and modern awards are met is simple, quick and relatively painless. You will find new opportunities for business improvement when you examine your entire HR system. Let’s face it if you employ staff you have an HR responsibility and the new Fair work Act changes everything.