AOS2 (part b) - business

4 types of termination management

Retirement, redundancy, dismissal, resignation.

Definition of retirement

A voluntary type of termination whereby an employee chooses to leave the business and exit the labour force, meaning they do not plan on working at another organisation.

Transition considerations + entitlement considerations of retirement

Transition considerations: allowing employees to gradually transition into retirement, such as gradually reducing work hours, and providing advice or counselling about lifestyle and finances. Entitlement considerations: employees are entitled to any accrued benefits, such as annual leave and long service leave.

Transition considerations + entitlement considerations of redundancy

Transition considerations: counselling, outplacement services, career advice, training, and financial advice. Entitlement considerations: employees are entitled to a redundancy package, notice, pay and benefits for work conducted, and severance pay.

Definition of redundancy

An employee's role no longer needs to be filled at the organisation, so the relationship between the employee and the business must end.

Dismissal definition

An involuntary type of termination whereby the business concludes the relationship with the employee due to that employee's performance being unacceptable.

Transition considerations + entitlement considerations of dismissal

Transition considerations: some businesses may introduce career transition services. Entitlement considerations: employees are entitled to pay and accrued benefits for work performed.

Resignation definition

A voluntary type of termination whereby an employee chooses to end the working relationship with the business.

Entitlement considerations of resignation

Payments for completed work and accrued benefits. The business is entitled to notice of resignation.

Definition of transition consideration

Outplacement services are services that assist in helping employees find a new place of work.

Definition of entitlement considerations

The obligations, often payments, that employees receive when terminated as required by national employment standards.

Examples of transition considerations

Resume writing, job skills, counselling, workshops, and offering letters of reference.

Examples of entitlement considerations

Payout of accumulated annual leave, redundancy payment, and remuneration such as wages owed.

6 participants in the workforce

Employees, employers, HR managers, unions, employer associations, and Fair Work Commission (FWC).

Roles of employees

Perform duties with proper care and diligence. Follow safety procedures. Obey a lawful, reasonable order within the terms of the contract of employment. Serve faithfully. Account for all money or property received. Not misuse confidential information acquired while at work.

Role of HR manager

Negotiating with employees and/or their representatives on issues of pay and working conditions. Acting as a mediating group between the interests of employers and employees. Developing grievance policies to solve disputes calmly and consistently. Ensuring that legal minimums for wages, conditions and safety are met. Managing the working relationship between the business and employees.

Role of unions

Unions are organisations that represent and offer advice to employees with workplace relations issues in exchange for an annual fee. In regards to workplace relations, unions are involved in negotiation of new wage agreements on behalf of employees, offering advice to employees, supporting and representing employees in disputes, organising industrial action such as strikes, and providing support for individual members regarding workplace conflicts.

Role of employer associations

Employer associations are organisations that represent and offer advice to employers with workplace relations issues. They are composed of employers that unite to share advice, support and promote common interests. In regards to workplace relations, employer associations are involved in negotiation of new wage agreements, notifying and assisting employers with changes in legislation, and advising or representing employers for workplace disputes.

Role of Fair Work Commission

The Fair Work Commission (FWC) is Australia's independent workplace relations tribunal. Its role is to assist employees and employers in maintaining a fair and productive workplace. In regards to workplace relations, the FWC is involved in approving workplace agreements, providing a safety net of minimum wages and conditions for all employees, hearing unfair and unlawful dismissal cases, regulating and monitoring industrial action, approving applications for industrial action, and assisting in resolving workplace disputes.

4 national employment standards

Maximum weekly hours of regular work, right to request flexible working arrangements, annual leave, and notice of termination and redundancy pay.

Awards definition

A legally binding agreement that sets out the minimum wages and conditions of employment in an industry.

Agreements definition

Contracts made at a business or enterprise level between employers and employees about terms and conditions of employment for one specific business. Agreements are approved by the Fair Work Commission. Agreements must leave an employee better off overall when compared to the relevant award or awards.

Advantages and disadvantages of awards

Advantages: simple and easy to follow. No conflict between employees as they are on the same system of pay and conditions. Consistent and stable as a single set of rules apply to the entire industry. Disadvantages: not flexible. Not competitive. Hard to link productivity gains to wages and conditions.

Advantages and disadvantages of agreements

Advantages: flexible. Attracts talent and boosts staff retention. Easier to create productivity incentives. Disadvantages: difficult to negotiate. May create conflict within the organisation if some employees receive higher pay than others. Time consuming to negotiate and agree on conditions.

Dispute resolution processes

Mediation and arbitration.

Mediation definition

Involving an unbiased third party facilitating the conversation and the parties coming to their own agreement. Not legally binding unless a contract or agreement is signed.

Advantages and disadvantages of mediation

Advantages: win/win situation if the parties come to their own agreement, leading to both being satisfied. Informal setting means it is less intimidating for each party to go through this process. Disadvantages: not legally binding, therefore does not have the power to be followed or enforced. Time consuming process. One party may overpower the other due to the informal nature of the mediation setting.

Definition of arbitration

A more formal process when either party applies to have the dispute solved by the FWC, which operates as an independent tribunal in these circumstances. A legally binding order is imposed based on evidence.

Advantages and disadvantages of arbitration

Advantages: legally binding. Decision is made by an expert who knows how to resolve disputes. Less time consuming. Disadvantages: win/lose situation, where one party is likely to be left satisfied while the other is not. May lead to a damaged relationship between employees and employer or business.