Draft for flexibility in employment contracts

Organisations should draft employment contracts with enough flexibility to allow for circumstances to change without requiring employee sign-off every time, says an employment law specialist.

Employment contracts are the foundation of the employment relationship, but it's important for organisations to avoid locking themselves into terms that might not always benefit their business. Businesses need to give themself the power to change at least some parts of the contract, including perhaps the employee's title, their job description, their reporting lines, their start and finish times etc. The way to do this is by including clauses which expressly allow you to make amendments. While businesses need to take award obligations and relevant legislation into account, clauses can be worded in a way that enables employers to vary them without employee agreement.

For example, you wouldn't include a clause in a contract that says 'Here is your job description. Any changes to your job description will be by mutual agreement', instead you would include 'Here's your job description. The company reserves the right to alter that position description on reasonable consultation with you'.

Ensure additional benefits are discretionary

When it comes to entitlements, such as bonuses and car allowances, employers can give themselves more flexibility if they clarify that additional benefits are granted at their discretion, which gives your business the ability to change or withdraw these entitlements if necessary or if circumstances change. This can be achieved by including express clauses that state the company may change these entitlements at its discretion... subject to reasonable consultation.

What else should be excluded?

Leaving information about standard company procedures and processes out of the employment contract will enable employers to alter them more readily. By putting those things into the contract you open the business up to risk for breach of contract in circumstances where you're not able to comply with those requirements. Instead, employers are advised to include information on procedures, such as grievance or performance management processes, or WHS instructions in their policy documents.


from the article  "Draft for flexibility in employment contracts" at HR Daily