New Year, Shiny New Policies

Each workplace is unique. An effective workplace policy will ensure that its workplace policies and practices evolve with the organisation and its internal and external environment. That said, the reason for policies remains the same: to mitigate legal risks for the organisation and align its employees with the organisation’s expectations and procedures.

For many human resources professionals a logical New Year’s resolution may be to dust off and mark –up their organisation’s suite of workplace policies.

In this regard, we provide (as a starting point) some practical tips and considerations based on decisions that may have been handed down since your last review.

It is important to bear in mind that workplace policies need to be carefully tailored to your organisation and when updated, clearly communicated to employees.

Drug and Alcohol Policies: Zero tolerance?

In 2015, the Full Federal Court (‘FFC’) somewhat clarified its position on the implementation of zero tolerance policies in relation to drugs and alcohol. In Toms v Harbour City Ferries Pty Limited [2015] (‘Toms’), a ferry master was dismissed after testing positive for marijuana at work. The FFC appeared to endorse the employer’s reliance on a zero tolerance drug and alcohol policy, because the relevant work had a “safety-critical” element. In Toms, a ferry master was dismissed after testing positive for marijuana at work.

Bearing in mind the issues raised by Toms and similar decisions, it is important to consider when drafting or updating a workplace drug and alcohol policy:

• Does the nature of work at your organisation have a safety critical element that warrants the implementation of a zero tolerance drug and alcohol policy?
• Is your workforce sufficiently varied (for example, a combination of office workers and forklift operators) to warrant separate policies?
• Is there a risk of unlawful discrimination if separate policies are implemented within one organisation or if a single policy is applied differently to different employees?

Employee benefits – policy or contractual?

Between 2009 and 2016, the Royal Bank of Scotland and ABN AMRO Holdings Limited (‘AAAH’) were the subject of a protracted legal battle brought by two former executive employees (‘the Executives’). The protracted battle highlights the importance of clear drafting of the parties’ intentions in both policies and contracts of employment.

In McKeith v Royal Bank of Scotland Group PLC; Royal Bank of Scotland Group PLC v James [2016], the dispute turned on whether policies pertaining to bonus and severance entitlements had been incorporated into contracts of employment and therefore were due to the Executives upon termination in circumstances of redundancy.

Ultimately, the Court of Appeal of the Supreme Court of NSW held that the relevant policies were not contractual. Relevant to this conclusion was the fact that the employer deliberately withheld access to the relevant policies.

The decision re-examines a key question considered in earlier key decisions such as Romero v Farstad Shipping (Indian Pacific) Pty Ltd [2014] – “when will workplace policies contractually bind employers and employees?”

In light of the AAAH decision, as part of your review, it is worthwhile to consider which workplace policies (if any) are intended to contractually bind your organisation and its employees and ensuring that the policies are drafted to that effect.

In particular, it is prudent to ensure policies that may impart benefits such as a bonus, or redundancy pay in excess of the statutory minimum are drafted in a manner that is not contractual, and affords your organisation sufficient flexibility and discretion.

General Considerations

We hope the above provides a helpful starting point. The following list of overarching considerations is provided to assist with your review:

• Are your workplace policies consistent and can they operate harmoniously?
• Do the policies afford your organisation sufficient flexibility?
• Are the policies clear, accessible and easy to understand and then apply?
• Do you have a consistent approach to ensuring employees have access to workplace policies?
• Do your policies strike a balance between discharging work health and safety obligations and protecting your business without unduly encroaching on employee privacy?

If you require assistance to ensure your workplace policies are drafted to best practice standards, and in a manner that minimises your organisation’s exposure to unnecessary risks, please do not hesitate to contact Nick Stevens, Megan Cant, or Jane Murray on (02) 9222 1691.

This article is intended only as a general overview of legal issues currently of interest to clients and practitioners. It is not intended as legal advice and should only be used for information purposes only. Please seek legal advice from Stevens & Associates Lawyers before taking any action based on material published in this article.