Article 3 of 6: Dirty truth of handshake agreements – Good News, Compliance is Not Too Hard

By Kathleen Tierney
(Career Embassy)
September 13, 2017


Compliance is Not Too Hard

The good news is that in most cases, it’s not too hard nor expensive for any sized business to become compliant. In fact, for the majority, you don’t need to become an expert who delves into the vast myriad of legislation, set up bureaucratic piles of paper processes, engage a team of lawyers, nor hire someone exclusively to write everything from scratch.

A business owner rang me to share the news that the ATO had visited his restaurant unannounced at 7pm during dinner service to conduct a random audit. He jubilantly described how the ATO auditor was apparently “surprised and impressed” that not only did the restaurant have all their Tax and Superannuation payments up to date, it also had time keeping (finger print sign in/out), Letters of Appointment, Fair Work Statements and Award Rates in order.

Lawful alternative to the handshake agreement

To protect you, the business and your employees, the better and lawful alternative to a ‘handshake agreement’ is to invest and implement at least the basics of essential workplace compliance.

He and I both knew that had the ATO arrived 9 months earlier, they would have seen a very different situation. Working with us, the business owner had invested a small amount to get up to date, which saved him potential fines, ongoing audits and scrutiny by the ATO and Fair Work. At the same time, the business owners’ moral reputation, which was at the time, being challenged by an adversary within his local cultural community was appropriately defended.

Six fundamental aspects of compliance

Particularly, we suggest that all businesses, regardless the number of employees, must have the following six fundamental aspects current and compliant, being:

  1. Letters of appointment (plus the mandatory Fair Work Statement)
  2. Remuneration (Pay rates, tax and superannuation)
  3. Policies
  4. Procedures
  5. Practices
  6. Workplace compliance training

We recommend that your workplace compliance infrastructure make the most of the rights and opportunities that are available for employers, as well as addressing the requisite entitlements for employees as a minimum.

Easy solutions exist for all businesses

Though we are frequently told and do appreciate that each business ‘is unique and special’, it is possible to work with good quality standard templates rather than ‘re-inventing the wheel’. In fact, the most experienced People Management/HR advisors will tell you that workplace compliance structures in the largest corporations can be readily scaled to suit even the smallest businesses, regardless of industry, State, or number of employees.

Look out for our next article that discusses readily available online options for small to medium sized companies to implement Workplace Compliance.

About the Author

Kathy Tierney
Kathleen Tierney is the Executive Director and Owner of Business Embassy and its parent company, Career Embassy. She helps Australian companies with business management, HR services, policies and procedures. Kathy believes that great leadership and business success is achieved and sustained by connecting with our personal values.


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