Redundancy

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Employers - are you aware of your obligations?

Building and Construction General On-site Award 2010

This industry award covers employers throughout Australia in the on-site building, engineering and civil construction industry and their employees.

Employers: Are you aware of your legal obligations under Clause 17 ?

17. Industry specific redundancy scheme

17.1 The following redundancy clause for the on-site building, engineering and civil construction industry (as defined) is an industry specific redundancy scheme as defined in s.12 of the Act.

In accordance with 123 (4) (b) of the Fair Work Act the provisions of Subdivision B—Redundancy pay of Division 11 of the National Employment Standards (NES) does not apply to employers and employees covered by this Award.

17.2 Definition

For the purposes of this clause, redundancy means a situation where an employee ceases to be employed by an employer to whom this award applies, other than for reasons of misconduct or refusal of duty. Redundant has a corresponding meaning.

17.3 Redundancy pay

(a) A redundant employee will receive redundancy/severance payments, calculated as follows, in respect of all continuous service with the employer:

Period of continuous service with an employer:

Redundancy/severance pay:

1 year or more but less than 2 years

2.4 weeks’ pay plus for all service in excess of 1 year, 1.75 hours pay per completed week of service up to a maximum of 4.8 weeks’ pay

2 years or more but less than 3 years

4.8 weeks’ pay plus, for all service in excess of 2 years, 1.6 hours pay per completed week of service up to a maximum of 7 weeks’ pay

3 years or more but less than 4 years

7 weeks’ pay plus, for all service in excess of 3 years, 0.73 hours pay per completed week of service up to a maximum of 8 weeks’ pay

4 years or more

8 weeks’ pay

A weeks’ pay is the ordinary time pay rate an employee was being paid when their employment ended.

(b) Provided that an employee employed for less than 12 months will be entitled to a redundancy/severance payment of 1.75 hours per week of service if, and only if, redundancy is occasioned otherwise than by the employee.

(c) Week’s pay means the ordinary time hourly rate at the time of termination multiplied by 38. Hour’s pay means the ordinary time hourly rate at the time of termination.

(d) If an employee dies with a period of eligible service which would have entitled that employee to redundancy pay, such redundancy pay entitlement will be paid to the estate of the employee.

(e) Any period of service as a casual will not entitle an employee to accrue service in accordance with this clause for that period.

(f) Service as an apprentice will entitle an employee to accumulate credits towards the payment of a redundancy benefit in accordance with this clause if the employee completes an apprenticeship and remains in employment with that employer for a further 12 months.

17.4 Redundancy pay schemes

(a) An employer may offset an employee’s redundancy pay entitlement in whole or in part by contributions to a redundancy pay scheme.

      (b) Provided that where the employment of an employee is terminated and:

(i)                   the employee receives a benefit from a redundancy pay scheme, the employee will only receive the difference between the redundancy pay in this clause and the amount of the redundancy pay scheme benefit the employee receives which is attributable to employer contributions. If the redundancy pay scheme benefit is greater than the amount payable under clause 17.3 then the employee will receive no redundancy payment under clause 17.3;

or

(ii)                 the employee does not receive a benefit from a redundancy pay scheme, contributions made by an employer on behalf of an employee to the scheme will, to the extent of those contributions, be offset against the liability of the employer under clause 17.3, and payments to the employee will be made in accordance with the rules of the redundancy pay scheme fund or any agreement relating thereto. The employee will be entitled to the fund benefit or the award benefit whichever is greater but not both.

(c) The redundancy pay scheme must be an Approved Worker Entitlement Fund under the Fringe Benefits Tax Regulations 1992 (Cth).

17.5 Service as an employee for the Crown in the Right of the State of Western Australia, the Crown in the Right of the State of New South Wales, Victorian Statutory Authorities, or the Crown in the Right of the State of Victoria will not be counted as service for the purpose of this clause.

17.6 Employee leaving during notice period

An employee whose employment is to be terminated in accordance with this clause may terminate their employment during the period of notice and if this occurs, the employee will be entitled to the provisions of this clause as if the employee remains with the employer until expiry of such notice. Provided that in such circumstances, the employee will not be entitled to payment instead of notice.

17.7 Transfer of business

 (a) Where a business is, before or after the date of this award, transferred from an employer (in this subclause called the old employer) to another employer (in this subclause called the new employer) and an employee who at the time of such transfer was an employee of the old employer in that business becomes an employee of the new employer:

(i) the continuity of the employment of the employee will be deemed not to have been broken by reason of such transfer; and

(ii) the period of employment which the employee has had with the old employer or any prior old employer will be deemed to be service of the employee with the new employer.

(b) In this subclause, business includes trade, process, business or occupation and includes part of any such business and transfer includes transfer, conveyance, assignment or succession whether by agreement or by operation of law. Transferred has a corresponding meaning.

NOTE:   Apprentices and redundancy pay

Apprentices aren't entitled to redundancy while they’re under a training contract.

An employee who has finished their apprenticeship is entitled to redundancy. Their years as an apprentice will be counted when calculating redundancy pay and notice amounts if:

•     their employer kept them on for a further 12 months after the apprenticeship was completed or

•     they were terminated at the end of their apprenticeship but rehired with the same employer within 6 months.

Fair Work Websitehttps://www.fwc.gov.au/documents/documents/modern_awards/pdf/MA000020.pdf

ReddiFund can assist employers to meet their legal obligations under this Award plus the following benefits:

  • ·        You avoid accruing significant liabilities
  • ·        Contributions are tax deductible in the year you make them
  • ·        NO administration fees are charged to you or your employees
  • ·        Your employees will see that you are investing in their financial security
  • ·        Provides you with time and cost savings by ReddiFund’s efficient and timely administration in taking care of all claim processing.

Please contact:

Email:                   info@reddifund.com.au        Phone:                08 9481 0259           Website:             www.reddifund.com.au                                                         

Great tips on surviving a redundancy

ReddiFund is a WA-based redundancy fund open to all employers operating within the commercial building and construction industry to meet their obligations by making provision for their employees in the unfortunate event of redundancy.

Redundancies are never easy. It is a stressful situation from both an employer and employee perspective.  If you are the one being made redundant, here are some ways to make best of a difficult situation and gear you towards your new role.

1. Dont take it personally

The first time a person is made redundant it is usually a shock, especially if you have an outstanding performance record. You have to remember its often a downturn in business and change in job roles that trigger a redundancy, not people.

2. Seek support

Don’t think you have to carry the burden of the redundancy on your own. Discussing the situation with colleagues who have also been made redundant can be a great way to express your feelings and move on. Tell your trusted friends and family how you’re feeling and utilise external support services like your local GP or MATES in Construction www.matesinconstruction.org.au or 1300 642 111. MATES in Construction is an organisation providing counselling sessions for construction workers and their mates who are doing it tough, and is a service available 24 hours a day, seven days aweek. As a member of ReddiFund, you are entitled to six free counselling sessions.

3. Action ASAP

Draw-up an action plan, update your resume and work out what job hunting methods you will use [i.e. Seek, newspaper, your network]. Let people know you’re available for employment. Job leads can come from anywhere, including your old boss from three jobs ago.

4. Opportunity to upskill

You may have gained a number of additional skills in your last role, but have no ‘paper-proof’. Utilise some of your redundancy money to secure certifications reflecting what you can offer a new employer.

5. Get your finances in order

Work out your fixed costs and living expenses so you know the minimum wage you need to earn each week to meet your financial obligations.

6. Be flexible

In a reducing job market, consider temporary or contractors roles. It might lead to something more and you’ll be earning money.

7.  See yourself as a skill set, not a job role

Make a list of all your skills, attributes, education and training. See yourself as someone with multiple skill sets, rather than a particular type of job role.

8. Focus on your own pace

There will be hiring, but also job shedding this year. Keep up-to-date with what is happening in your industry sector and seek information from your networks i.e. which organisations are starting-up, expanding or contracting.

9. Rehearse and prepare

At the moment, ‘job hunting’ is your job. It can be infuriating when you put in maximum effort and a recruiter or employer doesn’t get back to you. Stay positive and focus on being the best candidate for the job. That means tailoring applications to the role, getting the right referees, and researching the companies you might join.

10. Check your baggage

When the employment market slows, competition for jobs increases and the number of applications for each job rises dramatically. Be honest about your redundancy [you’ve got nothing to be embarrassed about] and be careful not to take your ‘leftover’ anger with you to job interviews.

To find out more about the benefits of ReddiFund, call 08 9481 0259 or email info@reddifund.com.au . Alternatively visit reddifund.com.au

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