Employment Lawyers for Australian Executives

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26th August 2019
Melbourne & Sydney time: 7:10 pm

Call 1300 789 302

26th August 2019 Melbourne & Sydney time: 7:10 pm

SELECT AN ARTICLE
  • Fast Facts
  •     How to avoid the 10 most common mistakes made by executives
  •     Employment Contracts
  •     Redundancy Entitlements
  •     Bonus Plans
  •     Wrongful Termination and the Law of Contract
  •     Restraint of Trade Covenants
  •     Deductibility of Legal Expenses
  •     The Fair Work Act 2009 – Unfair Dismissal and Implications for Executives
  • Emergency Checklists
  •     10 things you need to know if you are facing possible wrongful termination
  •     10 Basic rules to follow if you are confronted with a disciplinary meeting
  • Expatriates - Employment Law Issues
  •     Australian employment law and the Fair Work Act 2009
  •     Negotiating an Expatriate Employment Agreement
  • Employment Contract Review


Common Law Rights (continued)

If your employment contract contains an explicit termination provision, then this is the clause that the courts will enforce.

However, many written employment contracts contain termination clauses which are defective. This is either because the documentation is so basic that a termination provision is not even mentioned or, if it is, the termination clause operates in a very narrow set of circumstances, none of which are relevant to the case at hand. It may, for example, permit termination only in the event of insolvency, mental illness, redundancy or gross misconduct but not for nonperformance.

Each case needs to be examined individually, but where the contract is silent on notice or the clause is somehow defective or the contract is otherwise unenforceable, the courts will imply a term of reasonable notice.

What is “reasonable notice”?

There are no fixed rules here and the courts have a wide discretion.

However, in arriving at a figure, the courts will consider the length of tenure, the seniority of the employee and the level of the salary package. If you have spent more than one or two years at a senior level on a six-figure salary package, you could expect to receive between 6 to 12 months’ notice based on the total value of your remuneration package. This is also an issue that would need to be assessed on a case-by-case basis.

How not to compromise your rights

It is extremely important that you do not take any step that may compromise your reasonable notice claim. The guidelines set out below will not only help preserve your legal rights. They will also help to ensure your continued survival in the office.

Don’t resign without taking legal advice

Under no circumstances should you resign from your employment without taking prior legal advice. If the contract of employment is going to be terminated, the general rule is that you should let the employer do the terminating.

In circumstances where you feel that resignation is your only option, perhaps because you believe your health is at risk, the letter of resignation needs to be carefully crafted to reflect the real reasons why you feel you must resign. Such a letter should only be written after taking legal advice.

Be the model employee

It is also important that you do not “slacken off” in the performance of your duties and responsibilities. This is sometimes tempting to do if your morale is low. However, you need to be mindful of not conferring on your employer any additional grounds for the termination of your employment.

Don’t reveal that you are taking legal advice

You should also not reveal that you are taking legal advice. You should convey the impression to your employer that you are simply “muddling through”.

Don’t sign any documents without taking legal advice

Under no circumstances should you sign any documents that may incorporate a new termination provision into your contract. You could easily go from having a common law claim of between 6 to 12 months to being terminated on 30 days’ notice under a new agreement.

Neither should you sign a Settlement Agreement or Deed of Release without getting prior legal advice. It is not uncommon for these types of agreements to impose obligations which do not appear in the original contract of employment and which will have the effect of extinguishing your common-law claims.

Don’t make any admissions

If you are facing a disciplinary interview or even a meeting with your employer that does not purport to be of such nature, you should nonetheless be very careful about the way you express yourself.

When called upon to do so, you should provide an explanation for your conduct or performance. A properly considered explanation may defuse the situation and prevent the matter from going any further. However, you should avoid making admissions that will simply be used against you at a later date, or which might open up other lines of enquiry.

It is, for example, unhelpful for you to say “… I guess my sales performance in the last quarter has been unsatisfactory…” Rather, you might be better off saying “… the sales figures were down the last quarter but there are many reasons for that and I’m happy to write a memo to you detailing the cause…” If you feel that you need extra time to provide a nonincriminating answer, you should not be afraid to ask for it.

Do not agree to changes in your duties and responsibilities

Do not agree to changes in your duties and responsibilities as this could be construed as an agreed variation to your contract with profound implications. Until prior legal advice has been obtained, you should be noncommittal regarding any of the proposed changes and responsibilities.

Keep a diary

Make sure you keep a proper diary that chronicles on a day-by-day basis events, meetings and telephone calls which impinge upon your performance or duties. If proceedings have to be issued, you will almost certainly have to provide sworn affidavit evidence. The process of creating an affidavit will be made much easier if you can refer to a contemporaneous record.

Keep important documents that relate to your employment conditions off-site

Keep a photocopy of all relevant e-mails, correspondence, the contract of employment, the company manual and any other relevant documents off-site. In the event that your employment is suddenly terminated, you may be locked out of your office and your computer. In this event, you may therefore be denied the documentation needed to evaluate and build your case. Be mindful, however, of your obligations of confidentiality and only copy material that relates to your employment conditions.

Do not trust anyone in the office

Do not trust anyone in the office. This may seem paranoid, but we have acted for many clients whose termination has been brought about by discussions they have had with work colleagues, whom they thought they could trust, only to find that the remarks made in such discussions have found their way to the manager. You need to keep your own counsel.

Do not use the office e-mail to correspond with your lawyer

Do not use the office e-mail system to make critical remarks about work colleagues, even if these e-mails have been “deleted”. Still less, should you use the e-mail system to correspond with your lawyer. Again, this may seem paranoid, but you should assume that your e-mails are being read and act accordingly.

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