EMPLOYMENT RELATION
Table of Contents
Executive summary 2
Background 2
Aim of the report 3
Scope of the report 3
What is BOOT? Why was it introduced? 4
How was BOOT applied to Coles and H&M? 5
What are the strength and weaknesses of BOOT? 6
How can the BOOT test be improved? 7
Conclusion 8
Recommendations 9
Reference 11
Executive summary
The fair work act 2009 was enacted to ensure good working condition all over Australia. The act emphasizes on proving benefits to the employees and make sure that the rate of payment of their pay check is as per the rules of the act. In this context, a fair work commission is set to make sure that the activities in the corporate grounds are within set standards. Approval of an enterprise agreement is only given when FWC is satisfied with all the clause. Agreements have to pass the BOOT test to prove that the agreement in which the job relations are specified keeps the employees better off overall than any other registered agreement. Although it takes a little effort and incurs some cost such an agreement gives two-way benefits to both the employers and the employees.
Background
To regulate the relation between an employer and employee and for the maintenance of a fair work environment, it is required that a set of rules are defined that the companies can follow by. As stated by Grayson (2016) The fair work act 2009 focus on fair policies in the deployment of wages to the employees and award them with extra benefits when it applies. For smooth functioning of a company, it is required that the mutual relation between the employer and the employees are clearly defined. This ensures positive long-term results for the company. As stated by Wilson (2013)A fair work commission is set to ensure that the rules and terms of work are clearly specified in the agreement of work. If any disputes arise in the way of the performance of the job agreement the matter can be taken to the commission. The hearing so made is fast and quick and ensures there is no partiality for nay side. It is kept transparent, and the decision is not biased by gender, race or religion.
Aim of the report
As stated by French et al. (2014) any matter that comes under the purview of the fair commission act, it well ensured that results would be fair and for the good of the corporate sector of the country. As stated by Charlesworth & Macdonald (2014) The commission is set in line with the fair work act 2009 that is designed to specifically clarify the terms and conditions of the work between the employer and the employees and also specify the mode and amount of salary disbursement. It sets out the rights and duties to the party of the job agreement. The facts about minimum wages and other basic requirement of an employee are covered under the national employment standards. This includes the hours of work, sick leaves, annual leaves, parental leaves, and fair work policy and notice period. This area of employment relations are covered by for all the employees of Australia, but some employees are eligible for the modern awards also. This award varies from one industry to another and covers areas like entitlements in the line of the minimum wage act, break hours, allowance, the procedure of dispute settlement and the availability of flexible working hours.
Scope of the report
As an employer in Australia, it is mandatory to work in line with the rules of the Fair work act 2009. As stated by Wilson (2013) The job agreement clearly specifies the obligations and duties of the employees which the employees abide by, and it is the responsibility of the employer to make sure that the employees are getting all their entitlements is due to time and amount. As stated by Pocock et al. (2013) Failure to comply with the rules of the act has significant repercussions on the employer and the image of the company. Matter related to breach of job agreement or prevalence of the unfair practice in the deployment of minimum wages or modern awards can be reported to the fair work commission, and proper actions will be taken for the same. As stated by Pocock et al. (2013) Decisions are made by countering facts of the matter in concern and by consulting people related to it. Evidence and oaths are collected, and a fair judgment is announced at the fastest time possible. As stated by Charlesworth & Macdonald (2015) the commission can also reject some applicants on the grounds that the matter so puts forth is not in line with the fair work act or is a false case. The absence of presence of the applicant can also lead to the use of dismissal power of the commission.
What is BOOT? Why was it introduced?
To ensure that the job agreement is fair and the employee can afford a certain standard of living with the entitlements given in the agreement a test is done. As stated by Charlesworth & Macdonald (2015) The Fair work act 2009 suggest that the monetary relations between the employer and the employee are clearly specified. Payment of basic salary along with modern awards if applicable should be paid to the employee at due intervals. As stated by MacDonald & Charlesworth (2013) The BOOT test is done to make sure that then agreement that the employee is covered under is at par with the registered agreements and the entitlements are fair and reasonable. It is tested that with the relevant agreement the employee is better off in comparison to the registered agreement.
It is seen in most cases that employers find it difficult to manage the fluctuations about the variety of elements in the wage. As stated by MacDonald & Charlesworth (2013) Employees who work overtime or agree to work on weekdays or holidays or do hardcore night shifts are entitled to an extra amount up to and above the salary. Such incentives differ from employee to employee and from organization to organization. As stated by Wright & Lansbury (2014) for including such varied elements in the process of deployment of salaries a new agreement called an absorption agreement is worked upon. Such an agreement take into account such entitlements and “absorbs” it into a newer arrangement that promises a higher value than the basic salary. As stated by Skinner et al. (2014) Award flexibility agreements has been beneficial to both the employers and the employees. As stated by Skinner et al. (2014) Modern day business practices are subject to many fluctuations to live up with the ever changing external business environment. This makes rigid guidelines and rules hard to be followed by. Such agreements give the liberty to change certain clauses of the agreement as for when the requirement arises. This types of agreements have all the information about the terms and condition of work along with the extra entitlements the employees are eligible for. Such information is required to make in written and should be done with the consent of both the employer and the employee. It should clearly specify the relation of the employment in the context of the awards. But before such award flexible agreements or AFAs come in force it required going through the BOOT test. As stated by Wright & Lansbury (2014) if with the AFA the employees can be better off overall as compared to any other relevant agreement or no agreement than the results for such an AFA is said to be positive.
How was BOOT applied to Coles and H&M?
As stated by Charlesworth & Macdonald (2014) Approval of the enterprise agreement is subject to the powers of the fair work commission. It is important that the contents of the agreement are satisfactory and the Commission is in support of the terms of the agreement. As stated by Dransfield & Silcock (2013) for getting approval it is very important that the contents and terms of the agreement are beneficial for the employees. It is seen in the case of Coles Store Team Enterprise and H &M when the agreement was not approved by the commission because the pay pack rate did not pass the BOOT test and the employees cannot benefit from the same in the long run. It was seen that the employees who were working post their shift hours attract penalty rates. The usual pay off was not able to make up for the deficiencies in the monetary entitlements. Also, the penalty rates were less awarding for the employees. The contingent entitlements were not able-able to cover up for the shortfall, and the benefits derived from the same was very less. Such an arrangement was not able to put the employees in a better off overall position. Hence the application was not approved. Certain changes in the agreement were made to get the approval of the commission. Such changes were to increase the casual loading to 25% and the raise the pay rate for employees falling under the age group of 17 and 18 from 60% to 70%. Also, changes were brought to ensure that the take home salary of the junior employees is greater than what they were expected to get if they were entitled to the award. After the company has taken this steps to make up for the monetary deficiencies of the employees the agreement was approved by the FWC.
What are the strength and weaknesses of BOOT?
As stated by Eskander & Greene (2015) in the changing scenarios of business it becomes very difficult to predict the future course of action and keep provision for embracing sudden changes. This problem can be overcome by taking up the AFA to specify long term job obligation and deployment of wages. If the AFA passes the BOOT test, it stands to be applied in the course of the employment tenure. As stated by Eskander & Greene (2015) The BOOT test makes sure that employees’ remuneration system is at par the registered employment agreement and the employees can afford a certain standard of living with the given amount. As stated by Gorton (2016). An agreement that has passed the BOOT test ensures that the amount of wage paid to the employee is of higher value. It includes provision for an increase in the wage at regular interval of time. Also, it specifies an increase in the duration of breaks so that the employees get ample time to get their mind refreshed. As stated by Hardy et al. (2013) Agreements include more generous incentives like grant of leaves are granted to do charitable activities like a donation of blood, arrangement of pre-approved leaves, leaves to recover from any accident so occulted. Al this entitlement are included in agreement that has passed the BOOT test to ensure better performance and long-term gain of the employees.
As stated by Dransfield & Silcock (2013) Adoption of the AFA as a job agreement to specify the relation between an employer and an employee is subjected to the results of the BOOT test, if the results are positive the agreement can be put to use but if the content of the agreement are not the best for the employees this type of agreements may be of no use. Hence employers have to take the risk of incurring the cost required to negotiate the terms of the agreement and also borne the risk of not applicability of the agreement if it does not pass the BOOT test. Also, the time requires to create such an agreement and negotiate the contents of it require a lot of time. Again, if the employees want to represent themselves as a part of the union, they are bound to pay fees to the union for the assured applicability of the job applicability in the long run. As stated by Gorton (2016). It is required that a majority of the members of the union are in support of the agreement and vote in favor of the applicability of the agreement.
How can the BOOT test be improved?
As stated by French et al. (2014) To ensure good job relations between the employer and the employee it is important that the terms of the job agreement are beneficial for the employees and they are better off overall than if no they were paid according to the registered agreement. As stated by Hardy et al. (2013) The matter of the agreement are required to approved by the fair work commission (FWC)which ensures that the agreement is made for the good of the employees in the long run and the terms are according to the fair work act 2009. As stated by Layton et al. (2013) for the approval of the FWC it is required that the facts of the job agreement are presented in a clear and easily comprehensible manner and doesn’t oppose to any of the legal parameters of the corporate world. As stated by Bukarica & Dallas (2014) Agreements should be made in a manner so that it can make up for any shortfall in the monetary or incentive deficiencies. Job agreements should include such monetary benefits that it can do justice to the employees who are eligible to get incentives over and above the basic salary that the employees receive. As stated by Walpole (2015) Business environment is subject to constant change, facts and rate of payment should also be changed to keep up with the changes in the business environment. It is seen in many cases that employees want a change in the penalty rate system.
As stated by Healy & Kidd (2013) outdated penalty rate like for weekend and post-shift working hours should be replaced with newer and more effective rates. As stated by Lindsay (2015) A job agreement specifies all the activities of a job role and the goals and duties that are expected to be achieved by the employees. It specifies the monetary benefits, the basic salary and the additional increments and entitlements that the employees are subject to keep them better off than overall. Such terms of the agreements must be achievable, the contents of the agreements should be realistic and be for the long term benefit of the employer and the employees.
In recent times employees are stressing more and more on the employment cost. As stated by Grayson (2016) a close analysis of the cost of employment is very necessary to the satisfaction of the employees which is beneficial for the business in the long run. Hence factors that are beneficial for the employees should be put forth in the job agreement and keep the employees better off overall. The requirement of the BOOT test and the FWC should be kept in mind before drafting the agreement for the approval of the commission.
Conclusion
For the smooth running of business, it is very important for the employers to take care of the work conditions and pay rates of the employees. A good relation between the employer and the employee means more productivity and mutual benefits arising out of it. The fair work commission which was made in tune with fair work act 2009 was to improve the workplace relations in Australia. Any matter when reaches the commission is reported to a staff conciliator for the informal settlement of the case but if it doesn’t happen, so the submissions are requested from the related people for the purpose of taking evidence and holding hearings. It is required that the specifications of the job are well written and clearly specified in an agreement to ensure that the employees are better off overall. Any matter when reaches the commission is reported to a staff conciliator for the informal settlement of the case but if it doesn’t happen, so the submissions are requested from the related people for the purpose of taking evidence and holding hearings.
Recommendations
Fair work commission helps in understand the right ways of employing a person in the workplace. The fair work commission is one of the most important laws that helps in the determination of the relation between the employee and the employers. However, it is seen that the employer are reluctant for the application of the law. This is one of the most important aspects that needs to be understood. The employer needs to adapt to the law and abide by the different aspect of the law. One of the most important thing that needs to be understood is the fact that the fair work commission is being implemented to conduct the fair work and avoid exploitation of the employees. This is an important aspect that needs to be understood and highlighted. The fair act Commission helps in the addressing the different problems of the employees and the employers. This is one of the most important acts that helps in the determination of the nature of work and the kind of issues being followed by the employee in an organization. The fair work commission helps in the establishment of the right attitude towards the work and helps in the understanding of the right approach to take care of the different factors of the work. The commission helps in the addressing of the different problems of the employee. However, is being recommended to look precisely into the factor of employees and the commission needs to helps the building of a better relation between the employee and the employers.
Reference
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