Off with their heads

Human resources managers can often find themselves in a bind. For a job focused on building teamwork and retaining talent, there sure are a lot of legal regulations.

At an operational level, complex policies and procedures can quickly turn HR management into a quagmire. Although in some situations, all of that red tape can truly be a good thing.

When it comes to employement disputes, employee terminations, and retrenchments – emotional reactions can easily overcome good business sense. Leaders need to have options to help defuse an escalating situation, and the mundane hoops that typical HR policies force people to jump through can buy you a lot of time, and help matters cool down.

John Tenniel - Alice in Wonderland
John Tenniel - Alice in Wonderland

The area of workplace relations which can easily fall apart is more myth than reality – instant, consequence free employee dismissal. A sort of managerial Mad Hatter’s Tea Party, where the Queen screams “off with his head” whenever someone becomes annoying.

Put quite bluntly, perfomance management requires leadership and communication. If a leader allows matters within their team to spin out of control so badly that performance management cannot be used, then they are almost certainly calling into question their own management skills.

The Fair Work Act 2009 is the federal government legislation that covers disputes in workplace relations, and outlines the powers of the regulator – the Fair Work Ombudsman. The 2011 annual report for the Fair Work Ombudsman summed up the role as follows:

Our work promotes harmonious, productive and cooperative workplace relations. The overwhelming majority of us who work, go to work each day pleased that we can contribute; satisfied that we engage socially with our workmates; and that we are paid fairly for our labour.

On the one hand, my Office works daily with Australian employers to ensure this equation is a balanced one by providing them with the information they need to ensure fair payment.

On the other hand, we hear a lot about the exploitation of a relative few. When we hear these things, staff work assiduously to get to the bottom of the matter and, as best we can, ensure the exploitation is removed including, where necessary, by using formal investigation or litigation.

Which seems quite anodyne, and hardly worthy of the demonisation commonly heaped upon the workplace umpire. Given the relative youth of the organisation, it is early to judge performance – but their annual report is nevertheless revealing.

In FY2011, Fair Work had expenses of $150m. Most of their effort was spent educating businesses and employees about their obligations and entitlements, including handling 825,000 calls to their call centre. They also had the dubious distinction of issuing 341 press releases in a single year, which might help explain why shock jocks seem to love kicking them in the pants.

Out of all of the bad apples reported to the Fair Work Ombudsman, a grand total of 40 legal matters were finalised with enforceable undertakings in FY2011, with $2m of employee underpayments recovered (but not necessarily disbursed yet), and $2.1m of penalties imposed on offending businesses. 75% of new litigation was related to complaints covering wages and conditions, with unlawful industrial action barely a blip on the radar.

So far from being a job destroying bogeyman, the Fair Work umpire spends a lot of time and money listening to people with grievances, and making sure the rules of the game are understood by everyone.

Workplace relations and taxation are two areas where politicians of all persuasions love to tinker. I am certain there will be many more changes  to the rules over the next few years – regardless of who is running the show.


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