November 2010

How to guide – completing the contract templates – for ORIC corporations covered by the federal industrial relations system
Business manager / Bookkeeper / Administrative assistant
Permanent, Part-time Employment

Victoria / Northern Territory / Australian Capital Territory

This document has been prepared solely for the use of not-for-profit corporations registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act). Its application in any particular case will depend upon the facts of that case. In every case, due care will need to be taken by a corporation registered under the CATSI Act in assessing the suitability of its application. The Australian Government Solicitor and ORIC cannot take any responsibility for this assessment.
This document may only be reproduced or distributed for use in the drafting of a contract for a not-for-profit corporation registered under the CATSI Act. All other rights are reserved.

Before you start to fill in the contract template note the five following points:
•	The template only works for corporations employing employees in Victoria, the Northern Territory or the ACT. The template will almost certainly produce the wrong legal outcomes for anywhere other than in these jurisdictions so do not use it for employment in other locations.
•	The template assumes that the employment is permanent – that is, that the employment is not for a fixed period but is meant to continue indefinitely as long as the arrangement works. If the employment is meant to be for a fixed period, a slightly different template will be needed.
•	There are different templates for full-time and part-time employment. Make sure you are using the right one.
•	The template assumes that your corporation does not have an enterprise agreement under the Fair Work Act or an old industrial agreement under the federal Workplace Relations Act (for example, a certified agreement or a collective agreement). If one of those agreements is currently operating in your corporation, and if it applies to the job you are filling, the terms and conditions of employment for the new employee will have to be consistent with the terms of that agreement, and this template will almost certainly be wrong.  
The template also assumes that your corporation is not subject to what is known as an enterprise award – that is, a federal award that applies only to your corporation. (Only a very small number of ORIC corporations have their own federal award.)
•	The next thing you will need to do is to work out in advance – ideally, before you fill the position – which modern award, if any, applies to this work in the employment of your corporation.
One way to do this will be to contact Fair Work Online on 13 13 94 and give them the details of the employment, and see what their advice is about which modern award applies. Generally, they should be able to advise you on this.
Another way to do this is to use the tools at Fair Work Online on the internet.  Substantial help is available for employers at: 
http://www.fairwork.gov.au/Pay-leave-and-conditions/Awards/Pages/Modern-awards.aspx?role=employers
We have drafted template employment documentation that will work for the four modern awards that are most likely to apply to the employment.
If the employment is not covered by one of these awards, you should get legal advice on how to adapt the template material.
What is in the template?

The template consists of four parts.
1. The first part is the contract of employment which needs to be filled in, at various places, and signed and dated by both the employer and the new employee.
2. The second part is Attachment 1 to the contact – the job description. The corporation needs to decide what goes into the job description at Attachment 1. 
3. The third part is Attachment 2 to the contract – a summary of the National Employment Standards set out in the Fair Work Act, together with a summary of the main terms and conditions set out in the relevant modern award. Here the corporation needs to make sure that the correct summary is attached – that is, the one that relates to the relevant modern award (as opposed to another modern award that does not apply to the employment).
4. The fourth part is Attachment 3 to the contract – the Fair Work Information Statement. This does not require any input from the corporation. It is a standard document issued by the Fair Work Ombudsman.
Filling in the contract template

Clause 1: you need to fill in the name of your corporation. This is defined in the contract as ‘the Corporation’, so you don’t need to use the specific name of your corporation until you reach to the signing page.
The document is just an offer, not a contract, until it is signed.
Clause 2: you need to fill in the commencement date for the employment. This is the date that you expect the employee to begin work.
Clause 3 refers to Attachment 1 as setting out the job description. This describes what  the employee will be doing. As noted above, the job description should be completed by the corporation. 
Attachment 1 needs to be labelled ‘Attachment 1’.
Clause 4 of the contract deals with the period of probation. There are a few issues to consider here.  
•	The template sets the period of probation at three months but it can be longer or shorter, depending on the corporation’s needs. Generally speaking, the more senior the job and the more responsibility it carries, the longer the period of probation. Corporations may choose a period of six months or even twelve months. Any longer than this is quite unusual.  
•	Once you have decided on a period of  probation, for example, three months, put into the contract the end date of the probation (that is, the date of commencement plus three months, minus one day). So if three months of probation began on 17 August 2010, it would end at the end of 16 November 2010. 
•	If you make the period of probation 12 months, and you want to terminate the employee’s employment on the very last day of that period, you need to give the employee two weeks’ notice of termination, not one week’s notice, as is specified in the template. If you terminate the employee’s employment with less than one year of service, you only need give one week’s notice of termination. The contract specifies two things that have to be satisfactory for the employee to ’pass’ their probation. These are the employee’s conduct and their work performance. The corporation may wish to specify additional elements of probation in the contract.  For example, you may wish to add ‘or attendance’ to the last sentence of this clause.
Clause 5.1: you will need to insert the name of the modern award that applies to the employee’s employment. This could be, for example, the Social, Community, Home Care and Disability Services Industry Award 2010.
Clause 5.1 includes a link to the web page that lists all of the modern awards under the Fair Work Act, as well as a link to the Fair Work Online website that has information about the National Employment Standards. 
You need to have a copy of the relevant award available in the employee’s workplace.
Clause 5.2 is possibly the most difficult for a corporation. You will need to work out the classification of the employee in terms of the modern award that applies. This means you need to look at the classification clause of the relevant modern award and see which classification most closely matches the duties and responsibilities of the position.  You will need to specify that classification in the contract.
 As noted above there is significant help available to work out the right classification at the Fair Work Online website. The best place to look is at 
http://www.fairwork.gov.au/Pay-leave-and-conditions/Awards/Pages/Modern-awards.aspx?role=employers
Next you will next need to specify the pay point within that classification that you want to start the employee at. Generally speaking, you would specify the first pay point –  the lowest pay point – in the classification. Make sure you get this pay rate figure from an up-to-date version of the modern award. If you use the electronic link in the contract, it should always take you to the latest version of the award.
You should be aware that the award rate is the minimum you can pay. The award rate is likely to increase once every 12 months but the corporation should monitor the award pay rates to make sure it is always paying the right amount to employees. 
Alternatively, the corporation may choose to pay the new employee at a rate which is above the award rate. In order to do this, the corporation must specify a higher amount than the award rate which means keeping an eye on the wage rate increases. 
If the corporation is paying at the award rate, there is no need for a salary increase clause. This is taken care of by the award, although it will still be up to the corporation to make sure it is paying the right rate. But if the corporation chooses to pay a rate above the award rate, it makes sense to include a pay increase clause in the contract, like ‘The corporation will review the employee’s rate of pay on [insert date] each year, and may increase it from the first pay period after that date.’
Clause 5.3 says that the employment is permanent – that is, it does not have any specified end date – and that it is part-time. You will need to specify the number of part-time hours the employee is to work each week. This number must be less than 38 hours per week. These hours of work of the employee can only be changed by making another agreement in writing with the employee.
Clause 6 spells out which jurisdiction governs the contract.  Specify the relevant jurisdiction that the contract is made in – Victoria, the Northern Territory or the ACT – by omitting the ones that do not apply. This will not affect the application of federal legislation.
Clause 8 refers to the Fair Work Information Statement (FWIS) at Attachment 3. You can download the FWIS by going to: 
http://www.fairwork.gov.au/Pay-leave-and-conditions/Conditions-of-employment/Pages/Fair-Work-Information-Statement.aspx?role=employees
New employees must be given a copy of the FWIS when they commence their employment. Giving it to them with their contract helps to make sure this happens.
The signing page of the contract: Affix the Common Seal of the corporation to the contract in the presence of two authorised officers of the corporation who will sign the contract. If the corporation does not have a Common Seal – some do not – you can use the second form of words supplied in the template. Either way, one of the two forms of words needs to be deleted.
The contract needs to be signed by the new employee and by a witness to the employee’s signature. This does not all have to happen at the same time – each side can do its part separately.
Attachment 1 to the contract is the job description. This is discussed above in the notes to clause 3.
The attachment should be labelled ‘Attachment 1’.
Attachment 2 to the contract is the summary of the relevant modern award and the National Employment Standards. The key thing for the corporation to do here is to make sure that the correct summary is attached – that is, the one that relates to the relevant modern award, as opposed to some other modern award that does not apply to the employment. (The NES summary material is the same in each version.) 
The attachment should be labelled ‘Attachment 2’. 
Attachment 3 to the contract is the Fair Work Information Statement, discussed above in the notes to clause 8.  

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The attachment should be labelled ‘Attachment 3’.