ncic-ch04

4Employment issues

Once you have left school, you will most probably start looking for a job. Those people who have jobs, plus all of those who are unemployed but looking for a job are part of the labour force.

To be able to survive, we need money, so most people sell their labour to an employer and, in return, receive an income. However, if we define work as performing an activity that produces something of value for other people, then both paid and non-paid work are important aspects of our society.

focusOn completion of this chapter, you will have learned about the commercial and legal aspects of employment issues by focusing on your options, rights and responsibilities in the work environment.

outcomesA student can:5.1 Apply consumer, financial, business, legal and employment concepts

and terminology in a variety of contexts5.2 Analyse the rights and responsibilities of individuals in a range of

consumer, financial, business, legal and employment contexts5.3 Examine the role of law in society5.4 Analyse key factors affecting commercial and legal decisions5.5 Evaluate options for solving commercial and legal problems and issues5.6 Monitor and modify the implementation of plans designed to solve

commercial and legal problems and issues5.7 Research and assess commercial and legal information using a variety

of sources5.8 Explain commercial and legal information using a variety of forms5.9 Work independently and collaboratively to meet individual and collective

goals within specified timelines.

glossaryarbitration: when the Industrial Relations Commission

makes a decision about a dispute between an employer and employee, which is legally binding

award: a document that outlines an employee’s minimum pay and conditions

collective wants: goods and services that are for the use of the whole community

common law (employment) contract: when employers and employees have the right to sue for compensation if either party does not fulfil their part of the contract

conciliation: similar to mediation in that a third person, in this case the Industrial Relations Commission, helps settle a dispute by trying to get both parties to reach a mutually acceptable solution

discriminate: to treat somebody differently or less favourably because of her or his personal characteristics, such as sex, nationality, religion. This type of behaviour is called discrimination

employee: a person who works for a wage or salaryemployer: a person who hires employeesemployment contract: a legally binding, formal agreement

between an employee and an employerenterprise or workplace agreement: agreements about

pay and conditions made at the enterprise/workplace levelentitlements: non-wage benefits such as long service leave

or sick leavegoods and services tax (GST): a broad-based tax of 10 per

cent on the supply of most goods and services consumed in Australia

grievance procedures: a number of pre-determined steps that are followed to resolve a dispute

income: money received on a regular basis from work, property, business or social welfare payments

labour force: all those people who have jobs; that is, are employed, plus all those people who are actively seeking work; that is, are unemployed

loading: extra pay (often up to 20 per cent extra) on top of the normal full-time rate to compensate casual employees for lack of access to entitlements

mediation: when a third party helps those involved in a dispute to reach a solution acceptable to both sides

negotiation: a method of resolving disputes where the parties involved discuss the issues in an attempt to reach a compromise

outsourcing: the contracting of some organisational operations to outside suppliers

participation rate: the proportion of people aged 15 or over employed or actively looking for work

pieceworkers: people who are paid according to the number of items they make

redundancy: when a particular job a person is doing is no longer required to be performed, usually due to technological changes

superannuation: a way of saving so an employee has some money in retirement

taxes: the part of our income taken by the government to pay for collective goods and services

unemployment: when people are trying to find work but have so far been unsuccessful

New Concepts in Commerce102

4.1

Types of employmentThe ever-changing nature of work has resulted in agreater range of employment options available.Each type of employment option has advantagesand disadvantages.

• A high proportion of casual employees are in the 15 to 25 age group.

• The casualisation of the labour force has meant many workers do not have long-term job security.

• Over the last decade, part-time employment increased by 50 per cent and now makes up about 30 per cent of total employment.

• Full-time employees are required to work at least 35 hours a week.

Sally Nicholson — casual checkout operator‘As a casual worker, I am employed on an hourly

basis. The main disadvantages of casual employ-

ment are that I do not receive a range of entitle-

ments (non-wage benefits), such as long service

leave or sick leave, and the lack of job security. If

there is no work for me to do, I can be dismissed at

one hour’s notice, or with one hour’s pay instead of

notice. However, to compensate I am paid a loading; that is, extra pay,

on top of the normal full-time rate. As well, I have the flexibility to agree

or refuse to work at a particular time. While this job provides me with

some income, because it is not regular I am finding it difficult to obtain

a home loan. I was recently told that because of a change to the law, if

I’m employed in this job on a regular basis for more than one year I may

be eligible for some entitlements such as access to unfair dismissal

protection and long-service leave.’

Karl Gerstenberg — full-time nurse‘This is my first full-timejob. I work 42 hours perweek over a five-day cycle.Although I have to spendmore time at work than inmy previous part-time job,

I enjoy earning a higher income. This has madeit easier to start saving on a regular basis. Aswell, I am entitled to a wide range of non-wagebenefits, especially paid holiday leave and long-service leave. However, the greatest benefit isthe job security. The main disadvantage of full-time work is not having time for my hobbies butI guess the extra money makes up for that.’

Jamahl Nessari — self-employed landscape

gardener‘Being self-employed gives me the freedom

and flexibility to work where and when I want

to. I especially like making business decisions

and being responsible for the business’s suc-

cess. There are also some tax advantages to

being self-employed. However, being your

own boss does have a number of disadvantages. There is no guar-

anteed income each week and, consequently, a lack of security. I

have to pay for all my own entitlements and if I am ill, then I earn

no money unless I have some insurance. There are risks involved

but hopefully the rewards will be greater.’

Virginia Chung — part-time costume designer‘Part-time work suits me. Ican earn some money on aregular basis but, because Iam taking a TAFE course, Ineed time to study. As apart-time employee, I havejob security because I work regular days andregular hours but for fewer days or hours than afull-time employee. As a part-time employee, Ireceive a number of entitlements on a pro-rata(proportional) basis. For example, I work threedays per week so, therefore, I am entitled tothree-fifths of the non-wage benefits availableto full-time employees. However, part-timework does have a few disadvantages. Firstly,because I work fewer hours, I receive a smallerweekly pay and reduced entitlements com-pared to full-time employees. Secondly, I donot receive the loading paid to casual staff.Overall, while I’m studying, part-time employ-ment offers better conditions than casualemployment.’

Employment issues103

Volunteer bush firefighters

Voluntary and unpaid work Voluntary workers play an essential role in oursociety. Many people in the local communitywork for voluntary agencies such as bush firebrigades, Meals on Wheels and state emerg-ency services. They receive no financial pay-ment. They do it for pleasure and thesatisfaction of being able to help others.

Just because volunteers do not receive anincome does not mean that the job they do isany less valuable. Yet because they do notreceive an income, they are often undervaluedin our society. If paid jobs become less avail-able, our society may begin to value voluntarywork more highly and give these workers therecognition they deserve.

UNDERSTAND

1 Outline the difference between:(a) casual and full-time employment(b) paid and unpaid work.

2 Complete the statements in your notebook by selecting the correct words from the list below.(a) Casual employment offers but does

not provide job .(b) Part-time employees work regular but

hours than full-time workers and only receive entitlements on a basis.

(c) Full-time employees have the benefit of entitlements such as paid leave and long leave.

(d) people have the to work where and when they want to but face greater than other types of employment options.

3 Which 16-year-old employee, performing the same duties, will receive higher hourly payments from her or his employer?(a) Casual employee(b) Part-time employeeJustify your answer.

4 In your notebook or using a word-processing package, construct and complete a table like the one below. The first answer has been filled in for you.

COMMUNICATE

5 In groups of four or five, identify the disadvantages for employees locked into casual employment for long periods. Select a spokesperson to present your group’s ideas to the rest of the class.

6 Outline which employment option you would prefer after you leave school. Share your answer with the rest of the class.

INVESTIGATE

7 Prepare a list of ten volunteer agencies that operate within your community. You may need to refer to the Yellow Pages.

8 If you had the opportunity to be a voluntary worker, what would you do and why?

WORKSHEETS

4.1 Jobs for all4.2 Types of employment

risksfewersick

servicefreedomflexibility

pro-rataself-employedsecurity

Employment options available

Casual Part-time Full-time Self-employed

Advantages 1. Paid a loading

Disadvantages


4.2

Changing work patternsTraditional work patterns are changing rapidly.The idea of a job for life is disappearing andemployees in the future will tend not to have a

clear career path. Many people today have periodsas full-time employees followed by periods ofcasual, part-time or contract (self-employed) work.

Old and new approaches to work

OLD VIEW NEW VIEW

Job Work

Employee Vendor

OLD VIEW NEW VIEW

OLD VIEW NEW VIEW

False sense Sense of personalof security control


OLD VIEW NEW VIEW

OLD VIEW NEW VIEW

OLD VIEW NEW VIEW

OLD VIEW NEW VIEW

Employment Employability

Job titles Competencies

Career ladder Career lattice

One careerPortfoliocareer


Many changes in work patterns today are drivenby the desire of businesses to reduce labour costsand improve productivity. Some changes include:• the rapid growth of contracting out or outsourcing• a preference in many businesses to have a smaller

permanent workforce and to hire casualemployees as a flexible workforce to meet demandat peak times

• flexible working hours and arrangementsincluding telecommuting.

Demographic changesThe number of women in the workplace has risenrapidly in recent decades — women now comprise45 per cent of the workforce and have aparticipation rate of 70 per cent.

Employers are recognising the cost savings andbenefits of ‘family friendly’ workplace practices inorder to motivate and retain skilled staff. Womenhave also been attracted to the flexibility offered bythe many casual and part-time jobs available.

The Australian workforce is ageing and health and superannuation costs related to age will increase, requiring employees to plan for these future expenses. Consequently, the Federal Government is recommending that employees consider extending their working life rather than retiring early.

Prepare a bar graph

A bar graph allows you to see differences quickly, and to detect trends. Bar graphs are often drawn up from data in tables.

Step 1: Draw two bars 100 mm long and 20 mm wide within a horizontal and a vertical axis. Each 1 mm represents 1%.

Step 2: Label axes and graph.

Step 3: Divide up each bar in accordance with table data.Step 4: Give each category a different colour. Colour

bars and add a matching key.

Look at the following table and then complete the tasks.

Percentage of males and females in the

Australian labour force

(Source: Australian Bureau of Statistics, 6202.0.55.001,Labour Force, Australia)

(a) Convert this data into a bar graph with three separate bars — one for each year. Carefully label the graph and provide a key.

(b) What trend do these statistics reveal?(c) What reasons can you give for this trend? Discuss

your answer with the rest of the class and list points on the board.

2002

0 20 40 60 80 100

1992

Year

Teenage spending habits (% of income)

FoodClothesEntertainment

Key

Teenage spending habits

Item % of income 1992 2002

Food 29 18Clothes 51 33Entertainment 20 49

Year Male (%) Female (%)

198419942004

625755

384345

Casualisation of the labour forceOne of the most important changes to work patternsin the last 20 years has been the significant increasein casual employment. Casual workers currently makeup approximately 25 per cent of the labour force, withsome industry sectors — such as retail and hospitality— employing almost half their labour force as casuals.

Some casual employees, especially the young, findit difficult to gain full-time employment. Theirworking life is often dominated by periods of part-time and casual work. Consequently, they have fewopportunities for promotion and are usuallyretrenched first if the business is experiencing finan-cial difficulties. These people will sometimes experi-ence long periods of unemployment. Exploitation ofthese employees can also occur.

Casual employment is most common among young people


Technological changeThe so-called ‘information revolution’ has led tomassive changes in the way people work. The mainchanges are:• work can be contracted out to people working

from home• there is a marked decrease in the number of

people employed in manufacturing industriesand a corresponding increase in the informationand services industries

• ongoing training programs are needed• new jobs are being created using new technologies,

while others become outdated.

Technology changes the work people do.

Flexible working conditions and hoursFlexible working conditions are patterns of workthat allow employees to balance work and familyresponsibilities more effectively. For example, someemployer–employee agreements allow opportunitiesfor home-based work, which gives employees moreflexibility during working hours. This is becomingmore practical as electronic methods of communi-cation and other technologies improve. Many busi-nesses also offer permanent part-time work in orderto retain skilled and valued staff who have familycommitments.

Flexible working hours are a common feature inmany workplaces and may take the form of:• flexitime, which allows employees to nominate

starting and finishing times to suit their needs• maxiflex, which allows employees to build up

sufficient hours or overtime to take time off

• job sharing, which allows two employees to sharethe hours required for one job

• lengthening of shifts to 10 hours.Conflicting views are emerging from employees

(other than those who choose part-time work) aboutthe benefits achieved from flexible working hoursand permanent part-time work. Many employeesnow work 12-hour shifts, broken by days off, as partof their industrial agreements. Others have losttheir weekends and their ability to enjoy time offwith their families.

These difficulties have arisen because employeesand employers may have a different meaning forthe term ‘flexibility’. For example, an employee mayview ‘flexibility’ as providing her or him with anopportunity to rearrange work hours to better suittheir lifestyle and family commitments. However,an employer may see ‘flexibility’ as the introductionof longer shifts or the scrapping of penalty rates forweekend work.

UNDERSTAND

1 Are the following statements true or false?(a) This section was about the changes in traditional

work patterns. (T/F)(b) Many employees will have more than one career

during their working life. (T/F)(c) The number of females in the labour force has

increased over the last 30 years. (T/F)(d) Flexible working arrangements are becoming

common in workplaces. (T/F)2 Outline two effects of technology on work patterns.3 What has been the impact on work patterns of an

increase in the female participation rate in the workforce?

4 Why do many businesses offer ‘family-friendly’ workplace practices?

5 Examine the old and new approaches to work on pages 104 to 105. Briefly describe three of the changes to work patterns.

6 Why do employers and employees sometimes hold conflicting views with regard to flexible working hours and part-time work?

7 What are the advantages and disadvantages to employees of flexible working hours?

COMMUNICATE

8 In small groups, roleplay a meeting between management and employees where management wants to introduce a new roster of four-day, 10-hour shifts and remove weekend penalty rates. You may wish to video the roleplays and view and discuss them as a class.

WORKSHEETS

4.3 Work patterns


4.3

Benefits of education and training for employment I can’t wait to leave school,’ said Zara. ‘I want toleave as soon as I turn 15. Get a job, earn somemoney and have fun. No more rules, uniform orhomework!’ What Zara didn’t realise was thatwithout educational qualifications and furthertraining, she would find it very difficult getting andkeeping a job. If she wanted a good job, she wouldhave to change her attitude towards learning.

Lifetime of learningOne of the most frequentquestions people askschool students is ‘Whatdo you want to do whenyou leave school?’ It isoften a very difficult ques-tion to answer, especiallywhen the labour force ischanging so rapidly. What-ever your answer to thisquestion, as an employeeyou will be required to con-tinually undertake work-place training — a ‘lifetimeof learning’.

Over the last 30 years,there has been a steadydecline in the demand foryoung, unskilled, full-timeemployees. Most employerstoday prefer to hire peoplewho are either semi-skilledor skilled. Employees whohave undertaken trainingand gained skills will be ingreater demand thanthose who are unskilled.They will receive higherincomes and be offeredopportunities for pro-motion. Their trainingwill have given themthe ability to betteradapt to and cope withchange, and thechance to gainimproved job satis-faction.

A truck driver — an example of a semi-skilled job

Skilled jobsAmahl decided she wanted to be a telecommuni-cations technician. After completing year 12 shewas offered an apprenticeship with a large com-munications company. Part of her training was on-the-job training. She was shown what to do byanother technician and then carried out the task

herself. Another part of hertraining required her toattend the local Technicaland Further Education col-lege and study particularsubjects required by heremployer. She also had toobtain a specialist licencethrough the AustralianTelecommunicationsAuthority. She learnedmany skills over thethree years and was pro-moted to team leader notlong afterwards.

Jobs such as Amahl’s,which require specialisttraining and qualifi-cations, are referred toas skilled jobs.

Semi-skilled jobsAntony was offered a

driver’s job with a localtrucking company. Hehad little previousexperience. To be able todrive large trucks he hadto obtain a Class 4licence. This requiredsome training over acouple of months. Antonywas happy with his job buthis employment prospectswere somewhat limited.

A job such as Antony’s,which requires some trainingand qualifications, is referredto as a semi-skilled job.

A telecommunications technician — an example of a skilled job


Unskilled jobsAndrew wanted a job where he could work out-doors. After leaving school at 15, he was not inter-ested in undertaking any more study. He saw in thepaper that a local construction company required aperson to act as a general labourer on a buildingsite.

This was the type of job that suited Andrew. Hecould start straight away and did not need anyqualifications apart from being fit and healthy.However, in the long term, his job prospects werelimited due to his lack of skills.

Jobs such as this, which require very littletraining and no formal qualifications, are referredto as unskilled jobs.

Labouring — an unskilled job

Tai, crew trainer at McDonald’sTai started part-time work with McDonald’s whenhe was a year 10 student. He found the job inter-esting and he certainly liked pay day. He was keento learn, and undertook some on-the-job trainingcourses. The store manager was very impressedwith Tai’s range of skills and work performance.After eight months he offered Tai the position ofcrew trainer.

Tai was pleased to take on this added responsi-bility. It meant he could help train youngeremployees. As well, it was another formal qualifi-cation he could add to his work portfolio. Themanager also suggested to Tai the possibility ofundertaking the Certificate in Food Retail course ifhe wanted to work full-time. This traineeshipwould provide Tai with a nationally recognisedqualification that would give him greater jobsecurity and a higher income.

Tai gained a lot of personal satisfaction fromknowing that his training provided him with morejob opportunities.

UNDERSTAND

1 Identify three benefits to employees of undertaking workplace training.

2 Classify the following jobs into skilled, semi-skilled and unskilled:

3 After reading this spread, what advice would you give Zara?

4 During times of recession and high unemployment, in which of the three job categories mentioned in activity 2 do you think more people would be retrenched? Why?

5 ‘It is becoming more important for employees to undertake training.’ Explain why this statement is true.

6 If you were Tai, would you agree to undertake the Certificate in Food Retail course? Why?

INVESTIGATE

7 Locate the employment section of a major newspaper, then complete the following tasks.(a) Find five jobs for each of these

three categories: skilled, semi-skilled and unskilled. Justify your categorisation.

(b) Write down the wage or salary paid for each of the jobs. Find it out, if it is not stated.

(c) Decide which job requires the highest level of skill.

(d) Decide which job requires the lowest level of skill.

(e) ‘Employees with higher levels of training receive higher incomes.’ Is this statement supported by these advertisements?

COMMUNICATE

8 Design a creative poster aimed at 15-year-old students who may be thinking of leaving school. Highlight the benefits of staying at school to gain skills that will be useful in a job. Display your poster in the classroom.

9 Arrange for your school’s career adviser to come to your class and inform you about post-secondary training courses.

WORKSHEETS

4.4 A job interview

CarpenterFarm labourerSecretaryDentistCall centre operatorCharity collectorLibrarianFruit picker

Taxi driverCleanerTeacherMachine operatorFork-lift operatorChemistSales assistant


4.4

Types of employment contractThe employment contractWhen you begin your first job, both you and youremployer have entered into an employmentcontract. This is a legally binding, formal agree-ment between an employee and an employer.

Every employer and employee is bound by a con-tract of employment. There are three importantelements to these contracts: offer, acceptance andconsideration.

A business can place a job advertisement in anewspaper, put up a sign in the window orapproach you personally and offer you a job. If youdecide to apply for the position and your appli-cation is successful, you will be asked to attend ajob interview. During the interview you areinformed about the terms and conditions that applyto the job. This is the offer. If you agree to theseterms and conditions you make the acceptance.That is, you agree to take the job.

The consideration, from the company’s point ofview, is that it has to supply the wage and otherconditions offered. In return, the employee’sconsideration is to supply the labour. Considera-tion refers to the benefits that both parties willreceive.

A contract does not have to be written. It can be averbal (or spoken) contract. It is generally safer tohave a written contract, especially if one of the par-ties to the contract does not fulfil their side of thecontract. There is an old saying, ‘verbal contractsare not worth the paper they’re written on!’.

At the beginning of your employment there isnormally a good relationship between you

and your employer. It is what happens from therethat determines how the relationship develops. Ifboth parties to the contract fulfil their obligations,a positive relationship will be maintained. Some-times, though, this working relationship can sour.You may feel your employer is not fulfilling all heror his obligations. Of course, the employer mayfeel the same about you. When these situationsarise, you may need the help of someone from out-side the business. This person can help determinewho is liable under the terms of the contract.

Types of employment contractThere are four different types of employment contract.

AwardAll jobs have a set of minimum terms and con-ditions, which make up the award covering thatparticular job. The award outlines the minimumconditions on such issues as: pay rates; holidays;sick, long service and maternity leave; overtimerates; and contracts of employment. Someemployers will provide above-award payments,

especially if they wish to attract more workers

Read the employment contract thoroughly before you sign it. If there is something you do not understand then seek advice from a family member or a solicitor. Remember, once you have signed the contract you must abide by all its conditions.

A job offer can be made in several ways


to their business or if they want to hold on to theirexisting staff. Awards have the following advantagesand disadvantages.

Enterprise agreementImagine all the students in your Commerce classsitting down with your teacher and negotiating aset of conditions for your class. Apart from theessential conditions such as completing all thework and respecting each other’s opinions, youmight negotiate a homework-free month in returnfor one extra assessment task. You have justentered into an enterprise agreement.

Since the introduction of the Australian Work-place Relations Act 1996, enterprise agreementshave started to replace awards as an alternativemethod of determining employee pay and con-ditions. An enterprise agreement is a negotiatedarrangement between an employer and a union or agroup of employees. The agreement deals with the

Awards

Advantages Disadvantages

• Set a minimum for pay and

conditions

• Cover all employees

performing a similar job

• Protect employees from

exploitation

• Inflexible — may not suit

all employees

• Prevent recognition of

individual initiative

60 per cent of Australia’s workers are covered by either state or federal awards or enterprise agreements. Awards normally cover industries and types of job. Agreements usually cover workplaces or specific jobs.

pay and conditions of people employed in thatworkplace. This type of agreement is usuallyreferred to as a Certified Agreement (CA). It caneither replace an award or act as an ‘add-on agree-ment’ to awards. Enterprise agreements must beapproved by the Industrial Relations Commission(IRC) to ensure that employees are not disadvan-taged compared to the award conditions. Enterpriseagreements have the following advantages anddisadvantages.

Individual workplace agreementImagine if your Commerce teacher and you came toan agreement about your conditions of work for thissubject. These conditions would apply only to you.The new contract would do away with the class-room conditions agreed to in the award and enter-prise agreement. For example, the new agreementmay offer you a ‘classroom (employment) package’that includes more homework in return for theright to attend only two Commerce lessons eachweek.

Under federal workplace laws, this type of con-tract is referred to as an Australian WorkplaceAgreement (AWA). Such contracts are signed indi-vidually and are secret; that is, not open to publicscrutiny. It is therefore possible for employees whoperform the same job with the same employer tohave different individual agreements. However, no

Enterprise agreements


• Consultation with and

involvement of employees

• Possibility of improved pay

and conditions

• Access to training

• Greater flexibility

• Undermine award

standards, with some

employees working longer

hours

• Possibility of job losses

• Greater inequity in wage

rates between employees

Types of employment contract

Types of employment contract

Employer Employee

Enterpriseagreement

Individual workplaceagreement

Common lawcontractAward


employee can be forced into signing one of theseagreements. All individual workplace agreementsmust be approved by the Employment Advocate(EA) to check that employees are better off overallthan the award that applies to them.

Recently, individual workplace agreements havecome under criticism from trade unions. Theybelieve that by abandoning the protection ofawards, employees may be exploited by signing acontract with inferior working conditions.

Individual workplace agreements have thefollowing advantages and disadvantages.

Individual workplace agreements


• Increased pay

• Flexible work

arrangements

• Individual initiative

rewarded

• Possible reduction in

entitlements

• Abandon the protection of

an award

• Possible exploitation of

employees due to unfair

bargaining positions

Analyse a cartoonIn small groups, examine the cartoon below and write a paragraph summarising what you think is the cartoonist’s message. Consider the audience for whom the cartoon is intended.

Awards versus individual workplace agreements

Common law contractCommon law contracts cover employees who arenot under any agreements. They are more commonamong professional and managerial employees.Such contracts may be written or verbal agreementsand many are not supervised by the IRC or the EA.

Employers and employees have common lawrights to sue for compensation if either partydoes not fulfil their part of the contract. Commonlaw contracts have the following advantages anddisadvantages.

Rights and entitlements of employeesThere are a number of minimum conditions to whichall part-time and full-time employees have access —their rights and entitlements. Casual employeeshave the same rights as part-time and full-timeemployees. However, they usually do not have accessto any entitlements such as long service or sick leave.

Rights and entitlements of part-time and full-time employees

Common law contracts


• Right to sue for

compensation if the

employment conditions are

not met

• Flexibility to suit the varied

needs of individuals

• Include informal

arrangements

• Individual initiative

rewarded

• No union representation

• Possible exploitation of

employees due to unfair

bargaining positions

• Expense of any court case

Employees’ rights

These rights apply tocasual, part–time andfull–time employees

Casual employeesdo not have access to

these entitlements

Employees’ entitlements

• Wages — set by an award or agreements

• A safe and healthy workplace

• A discrimination-free workplace

• A pay slip showing the total amount and how the pay was calculated

• No requirement to undertake illegal activities

• Annual leave — minimum 4 weeks paid holiday leave

• Sick leave — up to 5–10 days when proof of sickness is provided

• Paid public holidays if the business closes (does not apply to p.t. employees)

• Long service leave — usually after 10 years of continuous employment

• Other leave provisions such as parental leave, bereavement leave


UNDERSTAND

1 Examine the job advertisements shown on page 110 and list what is being offered in each.

2 List the benefits (consideration) that the employer and employee receive under each of these employment contracts.

3 Which of the contracts for the jobs offered would be easier to enforce in a court of law? Give reasons for your answer.

4 What is an award? Under what circumstances may an employer offer above-award conditions?

5 Explain the difference between an enterprise agreement (CA) and an individual workplace agreement (AWA).

6 Determine whether the following statements are true or false.(a) The majority of Australian workers are covered by

awards or enterprise agreements. (T/F)(b) Since the introduction of the Australian Workplace

Relations Act 1996, enterprise agreements have started to replace awards. (T/F)

(c) Individual workplace agreements must be approved by the IRC. (T/F)

(d) Casual employees have access to all the entitlements available to part-time and full-time employees. (T/F)

7 What type of employee is usually covered by common law contracts?

8 Which type of employment contract would you prefer to:(a) accept as an employee?(b) offer as an employer?Give reasons for your answer.

9 Trade unions argue that individual workplace agreements can exploit some workers because of their unfair bargaining position. Outline why you agree or disagree with this view. Share your answer with the rest of the class.

COMMUNICATE

10 Draw a series of cartoons to show the rights to which all employees are entitled. Display your cartoons around the classroom.

11 Draw a picture showing what happens during an enterprise agreement bargaining session. Your picture can be a cartoon or a collage.

12 In small groups, decide which type of employment contract you would prefer if you were a:(a) casual sales assistant(b) full-time clerk(c) full-time senior manager.Justify your choice and then share your answer with the rest of the class.

13 Set up a class debate to consider the following topic: ‘Individual workplace agreements benefit both the employer and employee’. Share roles so that

those not debating are involved either in assisting with research or in running the debate and keeping notes on the arguments on both sides.

E-LEARNING

14 Using Jacaranda’s website — www.jaconline.com.au/commerce — click on weblinks and access the student section of the Australian Council of Trade Unions’ website. Go to ‘Job Union Match’ and select a job. Record the award conditions for this particular job. Note such aspects as training required, starting wage, name of the award, hours worked and representative trade union. Next, go to ‘Fact Sheets’ and read about unfair dismissal.

15 Use www.jaconline.com.au/commerce to investigate workplace relations for young people. Select weblinks and go to the WageNet link for this textbook and then to the factsheet for young workers. Select a topic that interests you and prepare a brief report on what you learned.

WORKSHEETS

4.5 The language of work

http://www.jaconline.com.au/commerce



4.5

UnemploymentOver the last decade, the level of unemploymenthas steadily declined. However, in our economythere is a certain amount of unemployment, evenduring periods of economic prosperity.

To be counted as unemployed in our society, aperson must be:• without work• available to begin work• actively seeking employment.

Unemployment can result from:• people leaving their jobs and going in search of

others• some jobs being seasonal; for example, fruit

picking• a fall in consumer spending which reduces the

demand for workers• the introduction of technology.

The cost of unemployment to the individual andsociety is high.

Full employmentFull employment is one of the main Federal Govern-ment economic objectives. The acceptable target forfull employment would allow for an unemploymentrate of between 4 and 5 per cent. In effect, thispolicy is saying that even when the level of econ-omic activity is high and the economy is expanding,of all those eligible people who are seeking work,jobs will not be available for 4 or 5 per cent. In alabour force of approximately 9 million, if between360 000 and 450 000 people were unable to find ajob, the economy would still be said to haveachieved full employment.

The total labour force is made up of all those people who have jobs; that is, are employed, plus all those people who are actively seeking work; that is, are unemployed (employed persons + unemployed persons).

The unemployment rate is calculated by using the formula:

Number unemployedTotal labour force

1001

×

For example:500 000

9 000 0001001

× = 5.6%

Interpret a line graphGraphs make it easier to compare and interpret data. It would be much harder to absorb these data if described in words. To interpret graphs properly, however, you need to know what to look for.

Read the labels on both axes before interpreting information.

Is the graph line rising or falling? If so, is it doing so sharply? Check the axes to see what this means.

Does the graph line show a consistent trend over time, or are there some unusual trends?

Unemployment rate 1993–2003

Look at the line graph showing Australia’s unemployment rate and answer the following questions:(a) What was the unemployment rate in:

(i) August 1993?(ii) August 2003?

(b) In which years was the unemployment rate above 7 per cent?

(c) In which two-year period did the unemployment rate decrease the most?

(d) Describe the trend in Australia’s unemployment rate over this ten-year period.

(e) Suggest some reasons for the change in the unemployment rate.

Aug1993

5

7

9

11

13%

Aug1995

Aug1997

Aug1999

Aug2001

Aug2003

Full-time school students who do not have part-time jobs, though they may be 15 years or older, are not considered part of the labour force because they are not available for full-time work. They are therefore not considered to be unemployed.


Personal costs of unemployment

Poor health The emotional andfinancial pressures can have anenormous negative impact on aperson’s physical and mentalhealth.

Discrimination Being out of thelabour force for long periods oftime can go against a personapplying for work. An employermay unintentionally discrimi-nate against such a person andnot even give them an interview.

Loss of skills The longer aperson is unemployed, themore difficult it becomes to finda job. While not working, theyare not acquiring new skills orpractising their existing skills.With advances in technology,employers may view long-termunemployed people as lackingnecessary work-related skills.Lack of motivation or sense ofachievement often makes it dif-ficult to overcome this hurdle.

Boredom With plenty of timebut limited by a shortage ofmoney, many unemployedpeople become frustrated andbored. This can sometimes leadto vandalism, crime and otheranti-social behaviour.

Ridicule and prejudice Beingunemployed may affect howothers in society view people.Often seen as ‘dole-bludgers’they are frequently the object ofridicule and prejudice. Themedia can often reinforce suchattitudes by implying that theunemployed are to ‘blame’ fortheir situation.

Isolation Many unemployedpeople end up feeling they arenot accepted as part of society.This may cause them to becomedepressed, ill or hostile. Feelinghelpless and hopeless, somepeople withdraw from main-stream society. This makes iteven harder to find employmentand results in the vicious cycleof long-term unemployment.

Loss of self-esteem Our societyplaces a lot of importance onthe type of work a person does.A person who is unemployedcan often lose self-confidence.The suicide rate amongunemployed people is tentimes higher than the average.

Poverty Without a job, there isno regular income. Social wel-fare payments only maintain aperson at a level below the pov-erty line. With few savings,there is little left over for thecosts involved in job-seeking.Long-term unemployment canstrain family relationships andharm the welfare and educationof children.

Unemployment is a fact of life — for some!


Jonathan Miller is an 18-year-old who is desperate for a job. He lives at home with his mother and two brothers.

Jonathan has been looking for a job for the last ten months. He left school at the end of year 11 because the work was getting too hard. Jonathan enjoyed working on his older brother’s car and wants a job as a mechanic.

Jonathan visited every auto business in his town but not one had anything to offer. He was starting to feel as if there was something wrong with him. He rewrote his résumé three times but all he ever got was rejections. Getting an apprenticeship and a steady job is all he wants. He believes he would make a good employee. His school references are good. He is keen to learn and does not mind working hard.

Securing a steady job will depend on Jonathan’s ability to acquire training and work experience. He has already realised this. ‘Why won’t someone give me a chance? Perhaps I should enrol in a TAFE course to gain some extra skills. Then I would have something extra to offer an employer.’


Social cost of unemploymentThose who experience periods of long-term unem-ployment suffer economically and socially. Com-bined, the individual costs are felt by the whole ofsociety. Families may have to relocate to other areasin search of work. Family members may becomeseparated in the process. Society’s living standardsare reduced and production of goods and servicesdecreased, while government spending on socialwelfare payments increases. Overall, society’squality of life and economic stability are diminished.

Voluntary employmentIf you are unemployed for a length of time, it isworth considering some form of voluntary work fora number of reasons:

• Good work habits. It can be very easy to get out ofthe habit of getting up and going off to school orwork, being responsible for a certain amount ofeffort each day and sticking to a time schedule. Vol-untary work will help you to keep good work habits.

• Improving your employability. An employer ismore likely to employ you because you haveshown that you have:(a) the initiative to try to help yourself(b) a basic willingness to work(c) not become lazy, careless or selfish(d) a feeling of responsibility to society in

wanting to contribute in some way.If you are prepared to work without payment,

an employer reasons that they will not have toomuch trouble getting you to work for money.

UNDERSTAND

1 Complete this sentence: ‘To be classified as unemployed a person must be . . ..’2 Copy and complete the following table and then answer the questions.

(a) Which country has the:(i) largest (ii) smallestnumber of people unemployed?

(b) Which country has the:(i) highest (ii) lowestunemployment rate?

(c) What is the benefit of expressing the unemployment rate as a percentage figure?

3 Write a letter to a local newspaper outlining your concerns about the level of youth unemployment. You may wish to use a word-processing package to write the letter. In your letter, refer to the following points:• effects of unemployment on the individual and

society• unemployment and young people.

4 In what ways might long periods of unemployment ‘go against you’ when applying for a job?

5 Why is it often difficult for unemployed people to find things to fill in their time?

6 Imagine you are in Jonathan Miller’s situation. What would you do to:(a) improve your chances of getting a job?(b) find other avenues of employment?(c) overcome any unintentional discrimination by

employers?

COMMUNICATE

7 In groups of four or five, prepare a list of all the effects of unemployment on the individual and on society. Present your information in a table similar to the one below. Alternatively, prepare this as a PowerPoint presentation.

8 In groups of four or five, provide some solutions to the high level of youth unemployment. Select a spokesperson to present your group’s ideas to the rest of the class.

9 Write and perform a song or poem, aimed at year 10 students, which expresses the feelings of long-term unemployed people.

INVESTIGATE

10 Research the latest level of unemployment.

CountryNumber of people

employedNumber of people

unemployed Labour force Unemployment rate %

A 3 500 000 200 000

B 1 500 000 17 250 000

C 1 600 000 1 900 000

D 56 250 000 2 750 000

Unemployment

Effect of unemployment on

individuals

Effect of unemployment on

society


4.6

Legal issues relating to the workplaceMost businesses that are successful in the longterm: • abide by the range of laws affecting the employ-

ment contract• adopt ethical workplace practices.

Occupational health and safetyEach year in Australia approximately 600 peopleare killed at work. On top of this, more than650 000 workers suffer some form of workplace-caused injury or disease. A recent safety postercarried the warning, ‘WORK IS A HEALTHHAZARD’. This is only too true.

Workplace accidents are most common in construction, manufacturing and retailing industries.

In New South Wales, the Occupational Healthand Safety (OH&S) Act 2000 outlines the legalrequirements for employers and employees.

Employers must ensure their workplace is safe andthat machinery is regularly inspected and main-tained. They must also provide protective clothingand adequate training. Committees have been setup in most workplaces to enforce the OH&S rules.

Employees also have a duty to perform their jobssafely. They must follow safety instructions andreport any situation they think may be dangerous.A major development in recent years has been theintroduction of the smoke-free workplace.

Anti-discriminationFor many years, discrimination in the workplacewas widespread. Women found it difficult to gainpromotion. They were often limited to clerical orsales assistant jobs. Pay rates for females havebeen, and still are, below the pay rates for males in

FATAL ACCIDENTS AT WORK

• FORKLIFT FATALITYA forklift truck driver aged 21 received fatal headinjuries at Westmead when the forklift slid on a con-crete floor and overshot the edge of the loading dock,catapulting the driver head-first into a truck parkednearby.

• SILO COLLAPSESA farmhand aged 21 had just opened the chute of asilo at Gulgong when the silo, containing 60 tonnes ofwheat, collapsed, crushing him to death beneath it.

• ROOF PLUMBER DIESAn apprentice roof plumber aged 19 received a fatalshock when the mobile aluminium scaffold he washelping to position tilted and touched overheadpowerlines at Whalan.

About 5.2 million workdays are lost each year due to workplace-caused injury or disease. In recent years, the total cost of Australia’s workplace injuries has been over $6 billion.


comparable occupations. Older employees or mar-ried women were sometimes dismissed or forced toretire to be replaced by younger, lower-paidworkers. Many migrants and Aborigines found itdifficult to secure permanent employment.

An act of discrimination

Beginning in the late 1970s, several federal andstate laws were passed aimed at ending these kindsof discrimination. Two of the most important piecesof legislation in this area are:1. Anti-Discrimination Act 1977 (NSW). This Act

makes it unlawful to discriminate against anemployee on the basis of age, race, sex, maritalstatus, religious beliefs, intellectual or physicaldisabilities, or sexual orientation.

2. Affirmative Action (Equal Employment Opportu-nity for Women) Act 1986 (Cth). This federalgovernment Act requires businesses to promoteequal opportunity for women in their employ-ment by establishing affirmative action pro-grams. These programs consist of written plansto hire, train and promote groups of people whowere formerly discriminated against.

Unfair dismissalOne important obligation of an employer that iscovered by government regulations concerns thetermination of employment. Any termination ofemployment that is considered harsh, unfair orunreasonable is illegal.

I HAD BEEN employed by Top Line Printersfor twelve years. During this time, I worked ata number of different jobs in the factory. In mylast position as a clerk, I received a very poorassessment from my supervisor. He complainedabout my performance and warned me that if Idid not improve I may be dismissed.

Prior to my job as a clerk, I worked in thegraphic design section of the company.Because I am a creative person, I enjoyed thiswork and received many favourable commentsfrom the customers. However, for economicreasons, the graphic design section was closedand all the employees were given other jobswithin the company. I was given a clerk’s jobin the personnel record section.

One Friday afternoon, I was called into mysupervisor’s office. I was told that anothersupervisor had complained to him about mypoor performance and that my services wereno longer required. I was not aware of anyother complaint. I had never been given any

written advice that my work was unsatisfactory.However, the supervisor’s decision was finaland I was dismissed. I think it is unfair.


Redundancy and retrainingRedundancy occurs when a job a person is doingis no longer required to be performed, usually dueto technological changes. Therefore, unless theexisting employee can be retrained for another job,they will be made redundant. Redundancy can beeither voluntary or involuntary.

Voluntary redundancy occurs when the businesswishes to reduce either the size or nature of itsworkforce and decides how many employees shouldbe ‘let go’. Employees are then informed of the situ-ation and given the opportunity to nominate them-selves for voluntary redundancy. Employees whochoose voluntary redundancy are offered a redun-dancy package: a payout of a sum of money. If toofew employees volunteer, the business may beforced to decide which employees will be maderedundant — involuntary redundancy.

As new technology is introduced, employees mustbe retrained, especially those whose existing skillsare no longer required. Training and developmentmeans changing the employees’ attitudes andbehaviours. It may involve teaching them specificskills, and allows existing employees to continuallyupgrade their skills.

PrivacyWhen you are employed, chances are that someoneis monitoring your performance and behaviour.Many businesses monitor employee telephone con-versations, Web hits, keystrokes, completion timeand emails. Some companies use closed-circuit tele-vision cameras to watch employees. Call-centreoperators have some of their phone calls listened tofor training purposes. Sometimes employees have touse a log-off code whenever they leave their desks.

This type of monitoring raises a number of eth-ical issues. Critics claim that a business’s right toknow is offset by the workers’ right to privacy — tobe left alone. There is growing concern overinvasion of privacy. For example, is it an invasion ofprivacy if a business:• uses computer surveillance to keep track of

employees’ every action?

Between 1811 and 1816, during the early stages of the Industrial Revolution, members of organised bands of craftsmen destroyed newly introduced machinery in the Midlands and the north of England on the grounds that it took away their skills and livelihoods. Their leader was said to be Ned Ludd, and the group became known as ‘Luddites’. Today, people who resist new technology are called Luddites.

• performs genetic screening to deny employmentto people whose future health problems mightdisadvantage the business?

• demands drug and alcohol testing of employees?• listens to phone calls and checks Web hits to

determine whether they relate to the job or arebeing made for private purposes?Businesses have the right — and, to some extent,

the obligation — to protect themselves againsttheft, misuse of company resources and unsafework practices. However, these goals should not beachieved at the expense of personal privacy. Gettingthe right balance between employer and employeerights can sometimes be difficult.

OutsourcingA trend rapidly gaining support throughout thebusiness world and government establishments isoutsourcing; that is, the contracting of some organ-isational operations to outside suppliers. Forexample, school cleaning is outsourced to privatecompanies.

Outsourcing has had a profound impact onemployees. Many businesses have rearranged theirworkforces to employ a minimum full-time staff andto use as many people from outside the business aspossible — on a contract, casual or part-time rate,or piecework. Those in favour of outsourcing arguethat resources are used more efficiently and itprovides employment opportunities. Opponentsargue that it results in less job security and lack ofemployee entitlements.

PieceworkPieceworkers are people who are paid accordingto the number of items they make. This method ofpayment is often used in the textile and electronicindustries. The advantage of such a scheme is thatit encourages effort and rewards those who areefficient. However, it is not suitable for jobs thatrequire time and care.

Outsourced pieceworkers


Recently a lot of piecework in the textile industryhas been outsourced. This has resulted in thousandsof mainly migrant women throughout Australiabeing employed by clothing companies at very lowpiece rates. Many of these companies are producersof expensive ‘designer label’ outfits. These workers donot have access to normal award conditions, workerscompensation, overtime and sickness benefits. Theyfrequently work 70 to 80 hours per week.

To combat the possible exploit-ation of outsourced piece-workers in the fashionindustry, the FairWear cam-paign was created by a collec-tion of churches, communitygroups and trade unions.

UNDERSTAND

1 What do the letters OH&S represent?2 Examine the photo of the construction site on page

118. List the possible health and safety dangers you can see.

3 Cut out and paste in your notebook a job advertisement in which the company claims to be an EEO employer. What does the company mean by this?

4 Explain the difference between voluntary and involuntary redundancy.

5 What is meant by the term:(a) outsourcing?(b) piecework?

6 Under what circumstances could it be acceptable for a business to check on an employee’s:(a) criminal history?(b) HIV/AIDS status?Share your answers with the rest of the class.

7 Substance abuse is becoming a problem in many workplaces where employees experience stress. Should employers have the right to drug test employees? Give reasons for your answer.

8 Describe the possible impact of outsourcing on employees.

9 Imagine you had a job making hamburgers. Would you rather be paid by the hour or a piece rate? Why?

COMMUNICATE

10 Imagine that you have just been made redundant. Predict how the redundancy could affect you. Share your answers with other members of the class.

11 You are a business owner with 20 long-serving employees. Fierce competition is threatening the survival of your business. Sales and profits are declining due to the lower production costs of your competitors. You could compete if you introduce new technology. However, this will mean ten employees will become redundant. In small groups, formulate the criteria you will use to decide who should stay and who should go. Present and justify your criteria to the rest of the class.

12 Look carefully at the cartoon showing outsourced pieceworkers. Is the cartoonist portraying a negative or positive impression of outsourced piecework? How can you tell?

13 Design a pamphlet alerting employees and employers to the dangers that may be present in a workplace of your choice. You may wish to use desktop publishing software to present the pamphlet with text and graphics.

14 Imagine you have just been refused a job because of your gender. Write and perform a poem or rap song expressing how you feel about this.

15 Arrange to interview a member of your school’s OH&S committee. Inquire into:(a) the committee’s role(b) how ‘accidents’ and ‘near misses’ are recorded(c) what authority the committee has in terms of

making recommendations.16 Set up a class debate to consider the following topic:

‘Equal employment opportunity (EEO) unfairly discriminates against males’. Share roles so that those not debating are involved either in assisting with research or in running the debate and keeping notes on the arguments on both sides.

INVESTIGATE17 Research a particular health or safety issue in the

workplace. Examples include industrial deafness, asbestosis and repetitive strain injury. Prepare a news item that will be read on the evening news. Read your report to the class.

E-LEARNING

18 Research the following by using www.jaconline.com.au/ commerce and clicking on weblinks to access the NSW WorkCover link for this textbook:(a) the role of WorkCover(b) obligations of employers under OH&S legislation(c) how a workplace can be made safer(d) some recent prosecutions.

19 To find out more about the FairWear campaign, go to www.jaconline.com.au/commerce, click on weblinks and then go to the FairWear link for this textbook.

WORKSHEETS

4.6 Discrimination and OH&S

FairWear campaign logo




4.7

The role of unions and employer groupsTrade unionsEarly beginningsThe Industrial Revolution began in England over200 years ago, in the late eighteenth century. Thisrevolution changed the way people lived and worked.People who once used to work as farm labourersmoved to the towns and began to work in factories.The working conditions in early factories wereharsh. Men, women and children had few rights.They were forced to work long hours in noisy, dirtyand dangerous workplaces. Accidents often hap-pened around machinery, but there was no compen-sation, sick leave or unemployment benefits. If aperson was injured, someone else took their job.

Children were cheap labour in factories and mills. As this 1853 illustration shows, they were often badly treated.

It was illegal to join with other workers to discusshow you could try to improve your working conditions.However, this did not stop workers from forming theseillegal ‘associations’ as they were known. Theseassociations were the beginnings of trade unions.

Role of trade unionsThe main roles of trade unions are to:• protect the rights of members• maintain and increase wages• improve working conditions.

The working conditions experienced by many oftoday’s employees are the result of past trade unionaction. By joining together, workers were able toapproach employers and bargain with morestrength for improved pay and conditions.

During the last 20 years, the number of Australianworkers belonging to a trade union has steadilydeclined. In 1982, the total Australian union member-ship was 57 per cent of all employees. In 2004, it hadfallen to 23 per cent. Part-time and casual employeesunder the age of 25 and female workers have thelowest level of union membership, with middle-agedand older male workers the highest level.

The main factors responsible for the decline intrade union membership include:• an increase in the number of casual employees• the downsizing of public sector (government)

employment• the contracting out of many jobs• a shift away from heavy manufacturing to more

clerical, non-unionised employees.With falling membership rates, the unions now

need to adapt to changing circumstances to survive.Some of the current services offered by various unions(in an attempt to maintain and increase membership)include cheap home loans, free legal services,discounted goods and services and income protection.

The first workers to form a trade union were six farm labourers from the village of Tolpuddle in Dorset, England. In 1834, they were arrested and sentenced to seven years’ transportation. Over the years, they became known as the Tolpuddle Martyrs.

Today, only 18 per cent of teenage workers are union members.


A trade union workplace safety rally, sparked by the death of a young construction worker.

Employers’ associationsEmployers also have found it necessary to jointogether to protect their common interests. The Aus-tralian Chamber of Commerce and Industry (ACCI)is the peak employer association, representing about350 000 businesses. Other important associationsinclude the Australian Industry Group and theAustralian Retailers Association (ARA). These andother associations have as their main roles to:• represent employers in dealings with trade unions• give advice and assistance on a wide range of

issues such as taxation, industrial relations andemployment legislation

• lobby governments with their memberships’ views.

Logos for the Australian Chamber of Commerce and Industry, and the Australian Retailers Association

In some cases, an employers’ association will nego-tiate with a union to establish a new set of pay andconditions. At other times, an association willrepresent its members before an industrial relationscommission. These services are a great benefit to allmembers, especially small business owners.

Employers’ associations have always been involvedin lobbying governments. Over the years, they haveset up a number of research offices to provideeconomic and industrial advice to their members andthe public. Their representatives often appear in themedia to present and discuss the employers’ views oncurrent workplace and economic issues.

UNDERSTAND

1 List the main roles of:(a) trade unions(b) employers’ associations.

2 Briefly outline the changing role of trade unions and employers’ associations.

3 What is the main difference between trade unions and employers’ associations?

4 Many people say trade unions have outlived their purpose. With working conditions greatly improved, there is no longer the need for trade unions. Do you agree with this statement? Justify your answer.

5 Why might an employer want to join an employers’ association?

COMMUNICATE

6 Why do you think young people are deciding not to join trade unions? Report your answer to the rest of the class.

7 Set up a class debate to consider the topic: ‘That trade unions should not be allowed to call a strike’. Share roles so that those not debating are involved either in assisting with research or in running the debate and keeping notes on the arguments on both sides.

INVESTIGATE

8 Refer to the Yellow Pages for your area. Look up the section that lists unions. Approximately how many are there in your telephone district? List the names of three that you find interesting. What is it that makes you interested in these unions?

9 Contact one of the unions in order to find out more information. Enquire about the number of members, the union’s aims etc.

E-LEARNING

10 Access one employers’ association referred to in the text. Inquire about the number of members, the association’s aims and the services it provides. To help you, go to www.jaconline.com.au/commerce, select weblinks and click on the employers’ associations link for this textbook.



4.8

Resolving disputesResolving workplace disputes can be time con-suming and very expensive, especially if a court caseis involved. Due to the adversarial system, courtcases often result in one party ‘winning’ and theother party ‘losing’. For this reason, many argue thatcourt cases may not be the most appropriate way tosettle some types of workplace dispute. So, over thepast 20 years, alternative methods have been set upto help resolve disputes. The main methods, in theorder in which they normally occur depending on theseriousness of the dispute, are:• grievance procedures• negotiation• mediation• conciliation and arbitration.

Grievance proceduresGrievances are complaints that anemployee has formally recognisedwith a manager or union represen-tative. Grievances usually occurwhen an employee thinks they havebeen unfairly treated.

To reduce the risk of these low-level complaints blowing out tobecome a major confrontationalissue, most businesses have devel-oped a system of grievance pro-cedures: a number of predeterminedsteps that are followed to resolve adispute. In most cases, the problem isresolved after discussions betweenthe people involved. For example,you may think it is unfair that awork colleague is always given firstchoice when selecting work times on a new roster.You decide to inform your supervisor of your griev-ance. The supervisor would then follow the set pro-cedures to negotiate a solution to everyone’ssatisfaction.

NegotiationNegotiation is a method of resolving disputeswhere the parties involved discuss the issues in anattempt to reach a compromise. Referring to theprevious example, you could negotiate with yourwork colleague to reach a compromise regarding theselection of work times on a new roster. The super-visor or manager then formally recognises thenegotiated agreement. Effective negotiators are notmotivated by trying to beat the other person. Rather,

they want to reach an agreement that satisfies allthose involved. Consequently, some ‘give and take’may be required in an attempt to reach a com-promise solution. Successfully negotiating a resol-ution to a dispute usually results in all the partiesfeeling good about the decision and committed to theend result.

Unfortunately, popular Australian culture placesa high value on winning — ‘winners are grinners’— and shames losing. Our cultural obsession withwinning, while sometimes a desirable quality, canbe an obstacle to effective negotiation. A win–winapproach is preferable.

If negotiation fails to resolve the dispute, the nextalternative is mediation.

MediationMediation occurs when a third party helps thoseinvolved in a dispute to reach a solution acceptableto both sides. Mediators do not act for either of theparties, nor do they advise or decide who is right orwrong. Their main role is to encourage the parties toexamine all the issues. Discussions are confidential

Negotiations can occur at an industry level; for example, when a trade union and an employers’ association negotiate a new industry wage agreement. The best outcome of negotiations occurs when both parties win — a win–win solution.

A negotiated decision


and held in a non-threatening environment. Themain advantage of mediation is that:• both parties will feel that they have achieved

something by themselves• it provides a win–win solution where no one is

seen to ‘lose’.Mediation is becoming a popular method of

resolving disputes because it reduces the risk of thedispute becoming worse, avoiding expensive legalcosts or disruptive industrial action.

If mediation fails to resolve the dispute, the nextalternative is to have the case heard in a court, theIndustrial Relations Commission, which has thepower to conciliate and arbitrate.

Conciliation and arbitrationConciliation is similar to mediation in that a thirdperson, in this case the Industrial RelationsCommission, helps settle a dispute by trying to getboth parties to reach a mutually acceptable solution. Ateacher conciliates when she or he assists two studentsto settle a dispute by offering advice and suggestions.

If no solution is reached and the dispute continues,the teacher now has to resort to arbitration. Theteacher decides what will happen, makes an orderand the students must obey. When the IndustrialRelations Commission arbitrates it makes a decisionthat is legally binding; that is, both the employer andemployee must accept the decision.

The main disadvantage of arbitration is that bothparties may feel they have lost some control overthe process and the final outcome compared to amediated or conciliated decision.

UNDERSTAND

1 What is meant by the term ‘grievance process’?2 Explain the difference between:

(a) negotiation and mediation(b) conciliation and arbitration.

3 What is the similarity between mediation and conciliation?

4 Why is mediation becoming a popular method of resolving workplace disputes?

5 If you were in dispute with a classmate about sitting in a specific seat, would you prefer your teacher to mediate or arbitrate? Why?

6 Briefly outline the possible benefits of a negotiated resolution both for employers and employees.

7 What is the advantage of a win–win solution when resolving a dispute?

COMMUNICATE

8 In small groups, roleplay a mediation session to resolve a dispute between two students who both want the same library book. You may wish to video the roleplays and view and discuss them as a class.

9 Rebecca and her employer are in disagreement over the sick leave entitlements of her award. She wants to be able to take three days off without having to produce a doctor’s certificate. Her employer wants it to stay as one day only.

Your class has been asked to help settle the dispute. Conduct a roleplay to try and resolve this conflict using conciliation. After this, conduct a mock trial and arbitrate on this disagreement. Elect a panel to act as the arbitrator and have class members present arguments for both sides.

10 Create a rap song or poem explaining the meaning of ‘mediation’ and describing a situation in which it applies.

A conciliated decision

An arbitrated decision


4.9

Taxation and superannuationTaxationAs a member of a democratic society, you havecertain basic rights. You have the right to freespeech, the right to an education, the right to voteand many other rights. You also have obligations.One of the most important obligations you will haveas an adult is the obligation to pay taxes.

Reasons for taxesMany people complain about paying taxes and feelthey would be better off without them. However,there are some goods and services that are providedfor the whole community and available for everyoneto use. These are called collective wants: goods andservices that are mostly provided by governments.

They include schools, hospitals, national parks,defence forces, social welfare payments and police. Topay for these goods and services, the governmentneeds to raise money, which it does through taxes.Taxes, therefore, are both necessary and important.By providing these services, the government plays animportant role in helping to look after our quality oflife.

Governments provide these collective goods and services but they belong to the whole community because our taxes are used to pay for them.


Types of taxesGovernments in Australia receive their income fromtaxes and charges on people. The Federal Govern-ment of Australia raises about half its money(revenue) through personal income tax, where a per-centage of each Australian worker’s earnings is givento the government. Income tax rates vary accordingto income. For example, a person earning $52 000 perannum pays $11 772 in tax. They pay no tax on thefirst $6000 they earn, 17 per cent on amounts earnedbetween $6001 and $21 600, and 30 per cent onamounts earned between $21 601 and $52 000.

PAYG income tax rates from July 1 2004

The Federal Government also gains revenue from:• company taxes paid by businesses out of their

profits• excise duty, a special tax placed on cigarettes,

alcohol and petrol• customs duty, a tax on imported goods.

Taxable income Tax rate Tax amount due

$0–$6 000 0% $0

$6 001–$21 600 17% up to $2 652

$21 601–$58 000 30% up to $13 572

$58 001–$70 000 42% up to $18 612

$70 001 + 47% over $18 612

Each year, the federal treasurer outlines the government’s budget for the next year. This details all the items on which the government intends to spend money (government expenditure) and the taxes it will rely on to raise the money (government revenue). For the 2002–03 federal budget, total expenditure was $168.2 billion and total revenue $175.5 billion.

Since 2000, Australia has also had a Goods andServices Tax (GST). This is payable on most goodsand services sold, with the major exception of freshfood. The GST is a tax that is applied at each stageof production but paid by the final consumer. Tenper cent of the price of each purchase is returned tothe Federal Government in GST. This money is thenpassed on to the state and territory governments.

Other governments in Australia also raise theirown income. Each state government imposes taxeson businesses; for example, payroll tax, gamblingtax and stamp duty (which is paid as a percentageon the sale of a house). They also receive incomethrough tolls on roads and from traffic fines. Localgovernments raise the bulk of their income throughrates. These are fees placed on each propertywithin their council.

Processes of paying taxesEmployment declarationWhen you start a new job, you should complete anemployment declaration form. The Australian Taxa-tion Office (ATO) will use the information you provideon this form to determine the amount of tax automati-cally deducted from your pay. If you have more thanone job, you must complete a form for each employer.

Income tax returnAn income tax return has to be completed andreturned to the ATO at the end of the financial year.Tax returns can either be lodged electronically ormailed. The ATO will then check your return todetermine whether you have paid enough tax. If youhave not, you will have to pay more tax. If you havepaid too much tax, the ATO will give you a refund.

All the information submitted on the tax returnshould be correct. Any wrong information, failing toinclude all your income or being unable to docu-ment your expenses are all offences that couldmake you liable for a fine or paying extra tax. Also,make sure you record your tax file number (TFN)correctly. This is a number issued by the ATO toidentify taxpayers.

This cartoon sums up how many people feel about governments increasing taxes.


Many people complete their tax returns them-selves. Others have specialised tax agents or evenaccountants to do it for them.

SuperannuationWhy should you worry about retirement at thisstage of your life? Well, imagine what your life wouldbe like if you had no regular income when you even-tually retire. Your lifestyle would suffer. What youneed is a long-term investment plan — super-annuation — that lets you save for your retirement.

An important message for school students about income tax. If you have a casual or part-time job, have a look at your next pay slip to check how much money is taken out of your pay as tax. Remember, though, that the government only keeps this money once you start earning a certain amount. If you earn less than this, the tax that you have paid is given back to you when you submit an income tax return.

What is superannuation?Superannuation (super) is money that you savefor your retirement. Your super contribution(money) is regularly deducted from your wage orsalary and placed into a special type of investmentaccount known as a super fund. Your employer willalso deposit their contribution into your super fund.These funds are then invested to increase theirvalue before they are paid to you when you retire.

Since 1992, when the Federal Government passedthe Superannuation Guarantee Act 1992, it has beencompulsory for employers to contribute part of anemployee’s wage or salary to a super fund. Theamount is currently 9 per cent. The government alsoencourages employees to make personal contribu-tions. It does this by allowing some contributions tobe tax deductible. Over time, these contributionshave a snowballing effect. The longer you leave yourmoney, the more it grows. However, you can onlyaccess your superannuation once you reach a certainage (generally between 55 and 60), unless you arefacing severe financial hardship.

Superannuation funds are invested to earn interest.

SuperannuationFund

$ $

$$

$Interest and

repayments

Employee's

superannuation

contributions

Employer's

superannuation

contributions

Contributors

receive a payment

on retirement

Invested

to increase

the value of

the fund


A superannuation contribution rate of 12 per cent of the average person’s pay will create about $1 million by the time they are 60 years old.

Advantages and disadvantages of superannuation as a saving/investment optionAs with all saving and investment plans, there areadvantages and disadvantages.

Superannuation as a saving/investment option


• A forced saving scheme

• The money is automatically

deducted and invested

• The value increases over time

• It allows you to maintain your

lifestyle into old age

• You can change super funds,

under certain circumstances

• You are given the right to

select which investment

options you prefer

• Your super fund stays active

even when you change

employers

• Most people have to wait

until they are 60 before they

can access their super funds

• Super fund investments may

lose value over time

• The government does not

guarantee the safety of super

funds

• Administration and

management fees are

charged by the super funds

• Taxation must be paid on

certain lump sum payments

UNDERSTAND

1 Why do governments tax people?2 Which tax raises the most revenue for the Federal

Government?3 What is meant by the term ‘superannuation’?4 Why do young people often regard superannuation

as irrelevant?5 How does the government encourage people to

contribute to superannuation?6 What is the obligation of employers towards

employees in relation to superannuation?7 Collect pictures of three collective wants provided

by the government and paste them into your notebook. Underneath each, write a short statement explaining how it improves your quality of life.

8 ‘We would all be better off if we did not pay taxes but provided for our own needs and wants.’

What do you think? Share your answer with the rest of the class.

9 Imagine you are an accountant for two income earners: Michael who earns $25 000 per annum and Tai who receives $58 000 per annum.(a) Explain to Tai why his entire salary is not taxed at

the 42 per cent rate.(b) Calculate the tax payable in each case.

10 Collect from a local newsagent an employment declaration form. Assume you are about to start working as a sales assistant at Sales Galore, 15 Hunter Street, Huontown, 2356.

Complete the form using your personal details. Your TFN is 759 886 240.

11 Complete a mock PAYG tax return form by using the following details:Name: Robert PolosakAddress: 2 High Street, Bigga 2497Date of birth: 18-5-1981Occupation: EngineerTax File Number (TFN): 371 958 137Income: $51 085Interest on term deposit: $2215Deductions:• Journals $435• Computer use $860• Lighting/power – office $1105• Safety equipment $792• Conference fees $1185

12 A friend has come to you for advice about superannuation. Outline the advantages and disadvantages of superannuation as a saving/investment option.

COMMUNICATE

13 PAYG income tax is a progressive tax; that is, the proportion paid in tax increases when income increases. As a class, discuss whether this type of tax system discourages people from working. Record your responses. Prepare a statement summarising the main points.

E-LEARNING

14 To find out more about e-tax, go to www.jaconline.com.au/commerce, choose weblinks and click on the ATO link for this textbook.

WORKSHEETS

4.7 Taxation and the ATO website4.8 Topic test — employment issues

Superannuation is a nest egg to be used upon retirement.



Check & challengeThe workplace

1 Match the terms below with the correct defi-nitions:

Terms(a) employer (b) entitlements(c) labour force(d) employee(e) casual employment (f) participation rate(g) award (h) part-time employment(i) loading

Definitions(i) A person who hires employees

(ii) The proportion of people aged 15 or overemployed or actively looking for work

(iii) An extra amount paid to casualemployees to compensate for not havingaccess to a range of entitlements

(iv) The seller of labour(v) All those people aged 15 or over who have

a job as well as those unemployed(vi) Holiday, sick and long service leave are

examples of this(vii) A document that outlines an employee’s

minimum pay and conditions(viii) Working regular days and regular hours

but less than full-time employees(ix) To be employed on an hourly basis

2 Lara is asked to work an extra four-hour shift.The overtime rate is time-and-a-half. She isnormally paid $15.00 per hour. What will beher total income for this shift?

3 Your stockbroker purchases $10 000 worth ofshares in U-Bute Enterprise Limited on yourbehalf. She charges you a commission of 2.5 percent. How much will you have to pay for herservices?

4 Explain what is meant by ‘entitlements’.Provide examples of entitlements.

5 (a) List three skilled jobs.(b) List three unskilled jobs.(c) Which of these two types of jobs will usually

result in higher incomes and promotion?Why?

6 What is an award? Under what circumstancesmay an employer offer above-award conditions?

Employment relations7 The following words have been scrambled.

Unscramble them and use each one in a sentence.

8 Why would businesses continually train their

staff?9 What is the role of a trade union in the work-

place?10 Briefly outline the main aims of the Anti-

discrimination Act 1977 (NSW) and the Affirm-ative Action (Equal Employment Opportunityfor Women) Act 1986 (Commonwealth).

11 What health and safety obligations does anemployer have towards her or his employees?

12 Explain the difference between conciliation andarbitration.

Taxation and superannuation13 Why do governments need money?14 What kinds of goods and services are funded by

taxation?15 Explain why the goods and services provided

by the government are not free.16 Apart from income tax, the Federal Govern-

ment gains revenue from which other sources?17 What is the purpose of an employment declar-

ation form?18 Why is superannuation considered a saving/

investment option?

Employment contracts19 List the four different employment contracts.20 Explain why both the employer and the

employee should be familiar with the award orcontract conditions covering a job.

21 Outline the three elements of an employmentcontract.

22 Explain the difference between an award andan Australian Workplace Agreement (AWA).

23 List the advantages and disadvantages ofcommon law contracts.

24 List the rights of all employees.

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Taxation issues

25 Every day, some form of tax is imposed onalmost everything we do. Outline three types oftax that are imposed by governments.(a) Why are taxes so necessary?(b) Undertake a quick survey of three people in

your community and ask them thefollowing questions:• Do you believe that you pay too much tax?• What changes do you think could be

made to the taxation system?26 Do you think the cost of government is likely to

increase in the future? Why?27 The government sometimes increases taxes or

reduces them to bring about a preferred econ-omic outcome. Do you think an overall reductionin taxes would result in a decrease or increasein the level of economic activity? Explain.

Legal issues relating to the workplace28 Do you think it is fair or unfair to abolish pen-

alty rates of pay? Give reasons for your answer.Present arguments from both the employers’and employees’ point of view.

29 Males under 25 years of age account for 30 percent of work-related deaths. Suggest reasons whyaccident numbers within this group are so high.

30 How effective do you think affirmative actionprograms are in eliminating discriminationagainst women in the workplace?

Technology and work31 Look at

this photo-graph and answer the questions that follow.

(a) What effect has the technology shown herehad on the jobs people perform?

(b) Predict what type of workforce will exist in30 years’ time. Justify your answer.

(c) What school subjects do you think will bestprepare you for your future working life?Give reasons for your answer, and thencompare it with those of other classmembers.

Training and work opportunities32 Research the latest income statistics to find out

the difference between male and femaleincomes. The annual Year Book Australia, pub-lished by the Australian Bureau of Statistics, isa good place to start.

33 What does the following illustration suggest about the relationship between education, work opportunities and changing work patterns?

ncic-ch04

Documents

legal problems

legal information

legal decisions5

employment contexts5

work environment

nonpaid work

employment concepts

employment issuesonce