Manager consulting with employees

Why consult with your employees?

December 15, 2017 | By Charlene Woodbine, Vitil

The Fair Work Act places an obligation on employers to consult with employees in many different situations. The obligation to consult is often seen as a 'mere formality' however failing to properly consult with Human Resource Capital can be a costly mistake for Perth businesses.

Aside from the legal ramifications of failing to consult, successful change management requires meaningful consultation and co-operation with employees.

When consultation is done properly, it can lead to:

  • improved productivity
  • a more positive workplace culture
  • a resilient workforce that is able to cope with change
  • a reduction in the number of claims made against an employer
When do I need to consult with employees?

The Fair Work Act provides that an employer has an obligation to consult with an employee in the following circumstances:

  • When you are considering making a major workplace change that is likely to have a significant effect on an employee. Examples include:
    • A restructure
    • Redundancy
    • Transferring to other work locations
    • Changing rosters
    • Changes in production, program, organisation, structure or technology
  • In connection with a termination of employment
  • When changes are introduced that affects an employee on unpaid parental leave.
How do I properly consult with employees?

The Fair Work Act does not prescribe any rules in relation to how consultation must take place. However, it is important to ensure that the consultation is genuine and not treated as a mere formality. It is also critical that decisions are not finalised until the consultation process has occurred and the employee's responses have been given genuine consideration.

The following are some tips to assist Perth employers with proper consultation:

  • Start the consultation process early
  • Ensure that the employee is given an opportunity to provide their suggestions
  • Provide the employee with as much information as possible relating to the decision
  • Respond to any questions in a timely manner
  • If the employee provides a suggestion, carefully consider their suggestion prior to finalising your decision
  • Provide the employee with time to consider everything you have said
  • Keep a written record of any discussion including any agreed outcomes
What happens if I don't consult?

Failing to properly consult can expose the business to the following:

  • Significant legal costs. Under the Fair Work Act, the maximum penalties for failing to consult are $10,200 for individuals and $51,000 for corporations
  • The risk of an unfair dismissal claim where employees have been made redundant
  • Proceedings for breach of an applicable award/enterprise agreement and significant civil penalties

If you are faced with a situation that may have a significant effect on an employee, we would strongly encourage you to seek advice from Vitil, your Human Resource professional, before commencing any consultation.

Vitil Human Resource Consultants

Vitil's Human Resource Consultants are a boutique HR consulting firm based across Perth, who offer flexible, reliable and affordable outsourced human resource support and recruitment services, where your team is the key focus. By outsourcing HR to an expert in Human Resource Services, our experienced professionals can objectively assess your environment, your human capital needs, and ensure you recruit to further develop your businesses performance.

Contact us to discuss tailoring HR solutions to your business needs.

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