Significantly changing a Contract of Employment – Unfair

Significantly changing a Contract of Employment – Unfair

The Fair Work Commission has ruled a company’s requirement for an employee to work additional unpaid hours and make himself available on-call was neither lawful nor reasonable in upholding an employee’s unfair dismissal claim.

The Company terminated the employee after the employee wanted to continue negotiations over a new on-call requirement which had come about after an issue on receiving calls after hours.

The Company’s technical manager emailed all IT staff to advise them their contracts would be revised to include a requirement for them to work 1,976 ordinary hours per year, with an additional 364 hours attracting no additional payment.

The new contracts (which were significantly different to the original contracts in terms of on-call requirements) provided employees with time off in lieu for hours worked above 2,340 per year, and determined a new roster requiring employees to be on-call 13 weeks a year in return for a payment of $77 per week.

The Company argued in the Fair Work Commission that the employee’s refusal to accept the company’s “lawful direction” involving the on-call roster along with his aggressive manner had provided sufficient grounds for dismissal.

Critically, the Deputy President Anne Gooley said the company had no legal right to compel him to accept significantly changed terms of employment.

Deputy President Gooley identified the key difference between an employee being required to work reasonably additional hours and being compelled to be on an on-call roster are quite different propositions, and accordingly the Deputy President deemed the dismissal “unfair”.

This is an important distinction to consider as you make decisions about what you think is a fair or reasonable instruction.

Michael O'Shaughnessy

Michael is a specialist in all things HR. With vast HR experience in the USA and Australia, Michael brings a wealth of knowledge and advice to HR Central. When he's not blogging for HR Central you can find him out for dinner in one of Melbourne's newest restaurants.

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