An employment relationship is primarily something to be agreed between the employer and the employee.
However, on top of this, Australian law imposes various mandatory obligations on the parties.
It is up to the parties to decide what will be included in the employment documents. There are many important matters which may be addressed, including details of the employee's duties, salary or wages which the employee will receive, other benefits which the employee may receive, confidentiality, how and when the employment may be terminated, and liability in the event of errors by the employee.
However, at the same time, there are various laws that the parties cannot avoid, and that confirm various rights for employees, and various obligations for employers. These laws deal with such matters as minimum wages, superannuation, leave entitlements, unfair dismissal, and workplace health and safety.
If an employer fails to meet their obligations under these laws, then the employee may suffer significantly. For example, if an employer pays below minimum wage, or fails to put aside superannuation contributions for the employee, then over time this could cost the employee a significant sum of money. In addition, the law imposes significant penalties for employers who fail to meet these obligations.
Therefore, it is important for both employers and employees to understand their various rights and obligations.
Both documents deal with the relationship between an employer and employee. However, an Employment Agreement provides more detail than a Letter of Offer of Employment.
In many cases, employers like to provide a Letter of Offer of Employment in the first place, to welcome the employee in and to set out the key terms in relation to their employment (such as their main obligations, commencement date, and what they will be paid). The employer may then follow this up at a later date with an Employment Agreement, which provides more details and can deal in more detail with such matters as other employment benefits, confidentiality, non-compete obligations, or intellectual property rights.
Some employers choose just to provide a Letter of Offer of Employment, deciding that it provides enough detail for their purposes. Others choose to provide an Employment Contract without first providing a Letter of Offer of Employment.
It is also worth keeping in mind that neither an Employment Agreement nor a Letter of Offer of Employment may be binding unless they are signed by the parties. Therefore it is best practice that both documents are signed by both the employer and the employee.
As discussed above, there are many different obligations for employers and employees which may be addressed in an Employment Agreement or a Letter of Offer of Employment. Some matters which are frequently addressed include:
There are many obligations which may be required by law, and unfortunately it is not possible for us to list all of them here. Depending on the nature and the industry of employment, these obligations could be set out in various instruments, including:
Some typical obligations for employers which may be provided by law include:
In addition to the various obligations which we have already discussed, there are a number of minimum standards, called the National Employment Standards which all Australian employers in the National Workplace Relations system must provide.
The National Workplace Relations system is a collection of legislation that applies to most employees and employers in Australia. It includes the Fair Work Act 2009, the National Employment Standards, registered agreements and awards. The Fair Work Ombudsman provides information about which employees are covered by the National Employment Standards.
If the National Employment Standards apply, then the Employment Agreement, Letter of Offer of Employment, employment award, enterprise agreement or other registered agreement can not provide for conditions that are less than the national minimum wage or the National Employment Standards.
The National Employment Standards may even apply to casual employees.
Various matters are dealt with under the National Employment Standards, including:
Employment relationships in Australia are complicated, and may be affected by many different laws, regulations and other instruments. These are also subject to change.
As a starting point, parties should review their Employment Agreement and/or Letter of Offer of Employment for information about their rights and obligations. In many cases, these documents may also provide information as to whether any Industrial Awards, Enterprise Agreements, or specific legislation or regulations apply to the relationship.
The Fair Work Ombudsman provides useful information about the National Employment Standards. The federal government's Department of Industry, Innovation and Science provides general information about legal obligations for employers. The Department of Industry, Innovation and Science also provides information about workplace health and safety.
Each state and territory government also publishes up to date information regarding employment obligations in the relevant state or territory.
As always, if you have any doubts or concerns about your own rights or obligations, then you should seek legal advice.