May 2010: In this edition

Social Networking in the Workplace… whilst we all agree communication is key at work, how beneficial is this form of communication and can Companies use this to greater effect?

Just a Thought –‘Henry Tax Review’ – this review was given to the Federal Government but only a few announcements have been made. What impact will the entire review have on small business?

Before we get started, the following is an update of news from the last couple of weeks…

Australia’s Unemployment Rate was a seasonally adjusted 5.3% in March, which has remained stable since the February period, with the participation rate at 65.1%;

WorkCover NSW has launched its latest advertising campaign entitled ‘Homecomings.’ This campaign is designed to remind companies and workers that the most important reason for workplace safety is not the actual work. The campaign states that each year thousands of workers are injured (and some never recover), and yes those injuries represent lost talent, experience, productivity and income. More importantly though, the campaign highlights that such injuries extend beyond the physical effects as these injuries also impact on the family;

It appears that job prospects for this quarter and for the remainder of this year are strong as evidenced by the Australian Chamber of Commerce and Industry’s latest report. This report suggests a level of confidence is the highest its been since March 2008, and suggests that employee numbers will increase;

Award Modernisation...

The Award Modernisation process involved reviewing and rationalising the awards in the national workplace relations system so as to create a series of ‘modern awards.’

This process began in March 2008, and by the end of 2009, some 1500 awards had been reviewed and in their place 122 industry and occupational awards were created.

These [modern] awards commenced on the 1^st January 2010 however most will include transitional provisions to allow a ‘phasing in’ of changes in wages, loadings and penalties…over a five (5) year period.  

These 122 modern awards together with ten (10) minimum National Employment Standards (NES), and the national minimum wage order, make up the ‘safety net’ for employees under this new system.   Modern awards must not contain terms and conditions that are less favourable than the national employment standards (effective from 1 January 2010).

It is important to note that employers and employees in the national system have the same workplace rights and obligation, regardless of the state they work in.

Features of the national industrial relations system include:-

-          the National Employment Standards (as referred to above);

-          [modern] awards that apply nationally for specific industries and occupations;

-          a national wage order (where it applies);

-          enterprise bargaining, and

-          protection from unfair dismissal.

These modern awards cover employees in a particular industry or occupation, for example, employees of constitutional corporations covered by the national workplace relations system, including:-

-          in Victoria, the Australian Capital Territory and the Northern Territory – all other employment;

-          in New South Wales, Queensland and South Australia – all other private sector employment (form 1 January 2010), and

-          in Tasmania – all other private sector and local Government employment (from 1 January 2010).

The following are generally not covered:-

-          in Western Australia – state public sector and local Government employment and employment by non-constitutional corporations in the private sector;

-          in News South Wales, Queensland and South Australia – state public sector and local Government employment, and

-          in Tasmania – state public sector employment.

Note that employers and employees that are not covered by the national industrial relations system will remain covered by the applicable state industrial relations system, with the inclusion of provisions for national entitlementsfor unpaid parental leave and notice of termination (or the payment of lieu thereof) as well as protection from the unlawful termination of employment.

Given these changes (i.e. the award modernisation process), the award previously used may well cease to exist, and as such it is imperative that employers and employees understand the modern award that covers their particular industry and/or occupation.

However, some employees are covered by an agreement and not an award.   An agreement is a legally binding document negotiated between the employer and the employee and contains employment terms and conditions that are often more generous than those contained in awards. Download our whitepaper on Award Modernisation

Social Networking in the Workplace...

Social Networks focus on developing and enhancing social relationships between people, who share a common interest. These social networks [platforms] can display personal information etc… (i.e. Facebook & Twitter) and/or professional particulars (i.e. LinkedIn).

The early social networking philosophies were to bring individuals together as a part of a community group with which they can share personal information and/or ideas (i.e. chat rooms). These, as we can see, have become very successful methods of communicating.

With this success come some concerns with regards to users making too much personal information available for all to see!

This has led to privacy issues where; not only do users disclose too much, [hosting] sites don’t take adequate steps to protect user privacy and third parties are actively seeking out user information.

I am aware of one particular organization that thought using such social network sites as a recruitment tool. Their idea was to look at a candidates profile to see what kind of person they appear to be, and use this to help determine the candidates’ suitability to the role and the culture of the company.

Interestingly the perception of using social network to help you find a job may be good in theory; however a recent survey conducted by Hays Recruitment found that 45% of job seekers didn’t see this as a viable option to help find work.

Notwithstanding some within the recruitment industry believe that this is an important medium to help promote an individual. It is important that people know about you, to get a feel for the sort of person you are. So the opportunity to connect via (say) LinkedIn is a good way to consider who the person is.

It is believed that LinkedIn is a particularly helpful way for making business connections. A Deloitte’s study has found that 23% of Companies already use social networking as a recruitment tool.

This of course all suggests that the process is ‘out in the open’ and potential candidates are maybe aware of who is viewing their profile!

Interestingly, I read of a European business that uses Facebook as a virtual ‘open house’ where candidates and Companies can meet on line and network…

So we see that social networking is in the workplace and is having an impact on the way we work. It appears that a majority of employers (worldwide) do not have a formal policy in place regarding the use of such sites at work, and therefore adopting a ‘wait and see’ approach before they do. But for those who support such mediums, the need for waiting can’t be understood.

The results of surveys of social networking appear to identify the following benefits; brand building 20%; fostering collaboration and communication 19%; new talent recruitment 15%; candidate assessment 13% and professional development of employees 13%;

I was reading a recent article in the paper that suggests the Federal Government’s initial response to the Henry Tax Review may have delivered some benefit to Small Business owners because it seems there are very few nasty surprises.   

Yes we did see that in its announcement, the Government wants to increase the Superannuation Guarantee levy up to 12% by 2020.   This will start with an increase of .25% (on the current rate of 9%) for the 2014 tax year – thus giving business time to prepare and consider this in future wage negotiations. Then on an annual basis, the rate continues to rise till 12% is achieved.

If that was a negative, one of the benefits identified relates to the way small business claims a tax deduction for new assets; this ostensibly will help with cash flow! An example of this is new assets costing up to $5k can be claimed in the full year (they are purchased). All other assets (except buildings) will be deprecated by 30% per year.   This is dependant upon this passing both houses of Parliament. Of course advice from a qualified accountant on this matter is advisable.

The only other change announced (at this time) was a reduction in the company tax rate for small business, from 30% to 28% effective from 1 July 2012.

It is important to note that this report produced 1000 pages and over 130 recommendations, with only a small amount being delivered now… so the obvious question is, what reforms are waiting for after the election?

If you would like any further information regarding the information contained within this Newsletter and/or any other HR Matter, please don’t hesitate in contacting us at contact@hrmconsulting.com.au or you can call John Cachia direct on 0419 738 735.

Remember at HRM Consulting, we help grow your business through smart solutions for your most valuable resource: your people!

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