Cost cuts a risky busi­ness

Be­ing creative could pave the way for a law­suit, De­bra Bela re­ports

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MAN­AGERS and em­ploy­ers tasked with find­ing creative, money-sav­ing so­lu­tions to ad­dress staffing is­sues are poorly trained and of­ten un­know­ingly act out­side the law.

Lawyers say it is leav­ing com­pa­nies open to lit­i­ga­tion.

Spe­cial­ist peo­ple man­age­ment and work­place law firm Peo­ple & Cul­ture Strate­gies says im­ple­ment­ing con­tract vari­a­tions such as de­mo­tions and salary freezes is ac­cept­able only when the em­ployee pro­vides ab­so­lute con­sent.

Man­ag­ing prin­ci­pal Joy­deep Hor says man­agers must en­sure they are op­er­at­ing within leg­isla­tive guide­lines as em­ploy­ees are three times more likely to seek le­gal ad­vice over a de­mo­tion or per­ceived un­fair dis­missal than they were seven years ago.

‘‘ It would be fair to say there are very few man­agers at any level in cor­po­rate Australia who have the level of un­der­stand­ing around the laws re­lated to peo­ple man­age­ment, against what they are as­sumed to have in the eyes of in­dus­trial courts,’’ Hor says. ‘‘ Peo­ple get pro­moted to man­age­rial and su­per­vi­sory roles on the back of tech­ni­cal and func­tional ex­per­tise with­out real re­gard to the cal­i­bre of their abil­i­ties as man­agers.

‘‘ Rarely is there any in­vest­ment in sub­stance and train­ing them on what they need to know,’’ he says.

The ab­sence of ed­u­ca­tion in this field leads mid­dle man­ager and se­nior ex­ec­u­tives to be­come more re­liant on in­ter­nal hu­man re­la­tions de­part­ments for ad­vice and sup­port on de­mo­tions, salary freezes and re­duced hours.

How­ever, Hor says that even HR man­agers can be un­der-in­formed on leg­isla­tive changes and con­trac­tual obli­ga­tions. Man­agers also can be reluc­tant to en­gage the help of their HR depart­ment for fear of los­ing con­trol of the process.

‘‘ De­ci­sions are made on the fly,’’ Hor says.

‘‘ Peo­ple don’t


WARN­ING: there’s any risk and throw cau­tion to the wind, think­ing maybe I’ll get away with it.’’

Hor says any work­place vari­a­tion above 20 per cent of an em­ployee’s nor­mal du­ties is con­sid­ered risky.

‘‘ Peo­ple are far more aware (of their rights), they may have been burnt pre­vi­ously and there is far more in­for­ma­tion avail­able to staff on their le­gal rights and re­spon­si­bil­i­ties,’’ he says. ‘‘ Long-stand­ing em­ploy­ees will have per­fect pa­per­work re­lat­ing to their changeover in man­agers or mov­ing to elec­tronic sys­tems, em­ploy­ers may not.’’

In­dus­tries most at risk of un­der­min­ing em­ploy­ees’ rights in­clude tra­di­tional white-col­lar in­dus­tries.

Proac­tive in­dus­tries in work­place reg­u­la­tions in­clude the blue-col­lar en­vi­ron­ments of man­u­fac­tur­ing, min­ing and the health and safety sec­tors.

‘‘ What trig­gers peo­ple into a fight more of­ten is the psy­cho­log­i­cal mis­man­age­ment of staff,’’ Hor says.

Picture: Bob Barker

Joy­deep Hor is man­ag­ing prin­ci­pal of Peo­ple & Cul­ture Strate­gies.

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