Q&A: Employment contracts for WA workers

It is important to note that an employee’s employment rights and conditions can come from a number of sources. Minimum conditions are found in legislation, such as the Fair Work Act, and can be built on by industrial instruments such as awards and registered agreements. Generally, employment contracts can improve on these minimum conditions but not make you worse off.

If you are unsure about what legislation, award or agreement you may be covered by see our publication Q&A: Minimum conditions of employment for WA employees.

All employees have an employment contract. An employment contract may be:

• written (including written communications);
• verbal;
• formed through the actions of you and your employer; or
• a combination of these factors.

In some circumstances you might be working under a contract, but you are another type of worker and not an employee. If you are unsure whether you are an employee, you may want to see our publication Q&A: Contractor or employee for WA workers.

If you are an employee, then you have an employment contract. You can think of the contract as the agreement that has been made about the terms and conditions of your job. If you have a written document that is called a “contract” then it’s likely that most of the terms and conditions that form the agreement are set out in that document.

Even if you don’t have a written document, you should still have made an agreement about when you will do your work, what type of work you will do, how much you will be paid, and other key terms. The details of this agreement might be from conversations you had before you started work, or from emails or text messages, or even just from the way your work has been carried out since you started.

Even if you have a written document, other communications and actions can have the effect of changing the terms of the written document, or providing additional terms.

There are also some important rules that are considered by the law to be a part of every employment relationship. We call these “implied terms” because they form a part of every employment contract, even when they aren’t written down or agreed to.

Implied terms include important and fundamental obligations like the duties of fidelity and good faith. This may include obligations such as attending your employment on time, acting honestly in the best interests of the employer and obeying lawful directions of the employer.

Generally, if you agree to work for someone in return for payment of wages, it is likely that you are an employee and an employment contract exists.

Depending on the type of arrangement you agreed to, there may be a question of whether you were an employee or an independent contractor. You can have a look at our publication Q&A: Contractor or employee for WA workers on the difference between a contractor and an employee and you may wish to seek legal advice on this.

Communications at the beginning of an employment relationship can form part of the employment contract. These communications will also play an important role in understanding the nature of the relationship. This may include text messages, emails and verbal conversations. It is generally better to get key terms of your employment in writing.

Generally, a contract, whether written or unwritten, cannot provide worse off conditions that those provided under law or industrial instruments, such as awards or agreements.

If the job you are doing is different to the job you accepted when you started working, then your employer may be breaching your contract. However, this will depend on the specific terms of your employment contract and the nature of the changes made. Sometimes it can feel like the job is “different” but it still fits within the terms of the contract, particularly if your duties are written in general terms or if the contract specifically allows for your employer to change your duties. So the first thing to do is read your contract carefully and see if it authorizes your employer to make changes to your role.

If you think there have been changes made or proposed that are not authorised by your contract, you may want to communicate informally with your employer to see if you can come to an agreement. When you communicate with the employer it is best to do it in writing, for example by email, so you have a record.

Be aware that where you continue to work in a changed role for a period of time, there may be an argument that you have agreed to the change through your actions. This is called “acquiescence” and can make it very difficult to later dispute the change.

If you are covered by an award or agreement there may also be a dispute resolution process that you could use if you cannot find an informal agreement with your employer. Many awards also have “consultation obligations”, meaning that employers are legally required to consult with employees before major changes. These are particularly relevant to re-structures and other major changes to an organsiation as a whole. To find out which award applies to you, and whether your award has these type of clauses, call Wageline if you are a state system employee, and the fair work Infoline if you are a national system employee.

Your employer may be able to change aspects of your employment relationship, this may include parts of your role, through:

• terms in your employment contract; and
• as part of the employer’s ability to make lawful and reasonable directions.

Whether the employer can change specific parts of your role will depend on the specific circumstances and you should seek legal advice for more information.

If you believe that your employer may be breaching the contract, you may wish to seek advice on your legal options at this point. You can contact us to make a request for legal advice here:  https://circlegreen.org.au/get-help/

Generally, your employer will require your agreement to change significant terms of your employment relationship. This may include your hours of work, days of work, pay rate, location of work and the duties that make up your job. Whether an employer can change these terms will likely depend on the specific terms of your employment contract and an applicable industrial instrument, such as an award or agreement.

However, there may be circumstances where changes, including to parts of your role, can be made by the employer. For example, if the contract states that a change can be made, then its unlikely to be a breach of contract. Some industrial awards and agreements may also allow for certain changes to be made. Sometimes an employer can make changes because they have a general right to provide lawful and reasonable directions.

If your employer does not have the power to make the change without your agreement (under the contract, an award or agreement) then by making the change they may be making a unilateral variation. This may be a breach of your employment contract and you may be able to bring a claim. See our claim guides for more information on making contractual claims.

You should be aware that if you continue to work without protesting the change this can be seen as evidence that you have agreed to the change. If you disagree with the change then you should communicate this to your employer in writing (this can be an email).

You should note that your employer may also be able to make reasonable changes to working arrangements as part of their power to give lawful and reasonable instructions to employees. In these cases, there is no formal change to your employment contract.

Generally, where you resign your employment you are not able to make a dismissal-based claim as you have made the choice to do so. However, where you have been forced to quit or you feel that the employer’s actions have left you with no other choice you may be able to argue this was a forced resignation or a “constructive dismissal”. Generally, you would need to show that the employer’s conduct is a serious breach of the employment contract or that it indicates that the employer no longer wants to perform it’s obligations under the contract.

Constructive dismissal is not a claim on its own. It is an argument that you would make as part of a dismissal-based claim where your employer is arguing you were not dismissed. If you are able to show that you have been constructively dismissed, and you are eligible, you may be able to bring a dismissal-based claim.

It is important to note that this can be a very difficult argument to make as you may need to show that you did not have other options available prior to resigning. Generally, you will need to show that the employer left you with no other option but to resign. If you are looking to resign you should seek legal advice first as you may end up with no job and no claim.

If you resign and want to make a claim a dismissal-based claim, you should be aware that you may have as little as 21 days from when your employment ended to file your claim.

For more information on dismissal-based claims see Q&A: Dismissal for WA employees.

If both you and your employer agree to a change in your contract it is best to get the change confirmed in writing so that you can keep a copy for your records.

This may be an email, letter or a revised contract.

If you are looking to change your contract you should ensure that any changes do not leave you worse than your minimum entitlements under either an award, enterprise agreement or legislation. While contractual terms below these minimums are generally not valid it is better to check prior to agreeing to a change.

This will depend on the specific terms of your employment contract.

If you are paid below the wage in your contract or have not been provided with the correct hours of work under your contract then your employer may be breaching the terms of your contract and you may be able to bring a contractual claim to recover the underpayment or be compensated for the damages under the contract.

Be aware that if you continue to work under a change to your contract, your employer may have an argument that you have accepted the change through your actions. This is called acquiescence. However, you cannot agree to conditions below your statutory minimum entitlements even if you did continue to work under the arrangement.

If you believe you have been paid below your minimum entitlements, under law or your applicable award, you can contact the Fair Work Ombudsman or Wageline. Where you have not been paid an entitlement you may have up to 6 years to make a claim either under a contract or industrial instrument.

If you are looking to make a contractual claim then you can see our publication Claim Guide: Breach of Contract for WA employees and Claim Guide: Denial of Contractual Benefits for WA employees.

All employees have an employment contract, even if unwritten. An employment contract can be written, verbal or a combination of both. An employment contract can also be formed from a verbal agreement or through you and your employer’s actions. This may include text messages, emails or verbal conversations.

Generally, your employer cannot provide employment conditions below your minimum entitlements. These minimum entitlements can be found in legislation, awards and agreements. This includes your wage.

You may need to contact Wageline or the Fair Work Ombudsman to determine if you are covered by an award or agreement. In some cases, these organisations may be able to help you get money back if you are underpaid.

If you think you are not receiving your minimum entitlements, you should seek legal advice. Generally, an employer cannot pay you below your minimum entitlements, even when this is in your contract.

You can check what your minimum wage should be, including if you are covered by a modern or state award, by contacting either the Fair Work Ombudsman or Wageline. Your minimum wage may be influenced by your industry, role and how you are categorised under an award.

If your employer is paying you below your minimum entitlements then you may be able to bring a claim for the underpayment.

For more information, see our publications:

Q&A: Minimum conditions of employment

Claim guide: Unpaid minimum entitlements for WA employees

This will depend on your contract. Generally, your employer should pay you for overtime hours by either:

• paying you for the individual overtime hours that you work ( if you are covered by an award then there may be a penalty rate for overtime hours); or
• making your weekly or hourly pay above the minimum rate and including a “set-off” clause in your contract.

A valid set off clause allows your employer to pay you a set amount each pay cycle that takes into account any allowances that you should be paid, including overtime. The higher wage must be equal to or greater than the value of the entitlement. To be legally effective, set-off clauses have to be drafted in a particular way. For example, they must specify the award entitlement that is not being given.

Generally, you should be paid at least the minimum wage including any penalty rates for the hours you work each pay cycle. Be aware that some awards provide for averaging mechanisms over longer periods of time, especially where work may be seasonal. If you are unsure if you are covered by an award then you should contact Wageline or the Fair Work Ombudsman to clarify your award position.

Your contract may mention an industrial agreement that covers your employment such as an award or an industrial agreement. Even if a contract does not refer to an award or enterprise agreement, they may still cover your employment.

Only a court or a commission can determine conclusively whether an award or enterprise agreement applies to your employment.

You can check if you are covered by an award or industrial agreement, by contacting either the Fair Work Ombudsman or Wageline.

For more information about the state and national systems of employment law, see our publication Q&A: State or national system for WA employees.

Generally, an employment contract can only override your minimum entitlements under an award if it gives more favourable terms to you.  In other words, you cannot usually contract below entitlements set by industrial instruments (awards or agreements) or by legislation, but you can contract above.

There may be situations where the employer is able “trade-off” certain entitlements under an award in return for paying you a higher rate of pay. This may be done through a valid set-off clause in your employment contract or an individual flexibility agreement if you are a national system employee.

If you believe that your employer is contracting below your award entitlements then you may be able to bring a claim for a breach of the award.

If you are unsure whether your employer is lawfully altering your award entitlements you may want to contact Wageline or the Fair Work Ombudsman.

You will need to review the terms of your contract. If you have a contract for a fixed period of time it may either be a:

• a fixed-term contract. A fixed period of time or a specific project contract will automatically end when the time period ends, or the specific project is finished; or
• a maximum term contract. A maximum term contract is for a fixed period of time or a specific project, but it allows either party to end the contract earlier with reasonable notice.

If a fixed term contract is terminated early, it’s likely that you can make an unfair dismissal claim (or another dismissal-based claim) or claim  compensation for lost wages with a breach of contract claim.

If a maximum term contract is terminated early, you may be able to make an unfair dismissal claim, or another dismissal based claim.

For more information on dismissal-based claim see our publication: Q&A: Dismissal for WA employees.

Be aware that if you are dismissed you may have as little as 21 days to make a claim.

You should seek legal advice as this can be a difficult question to answer and will likely depend on the amount and type of cost being claimed.

Where you have been overpaid due to a mistake or oversight from the employer, generally you will need to pay back the overpayment. If your employer is seeking unreasonably high repayments or seeking the repayment in one amount you should seek legal advice.

In many circumstances you will be able to negotiate a reasonable payment plan with your employer. If you fail to repay the overpayment your employer may have up to 6 years to bring a claim against you.

For both national and state system employees there are protections where employers seek to claim certain costs or payments that are unreasonable in the circumstances and for the benefit of the employer. There may also be protections under state and modern awards that can be specific to the industry you are working in. In some circumstances a contractual term may not be valid if it is asking you to pay wages to the employer that are not reasonable and not for your benefit.

In some circumstances you may be able to argue that a contractual clause is a penalty clause and therefore invalid. Whether a contractual clause may be a penalty clause will depend on the specific contractual term. If you believe a term in your contract may be a penalty clause you should seek legal advice.

If you have been overpaid and either you or your employer have identified the overpayment you may wish to write to the employer and proposed a reasonable repayment plan that allows you to pay back the overpayment over time without placing yourself in a dangerous financial situation.

For more information see our publications Q&A: Pay for WA Employees.

No. For an employment contract to exist, you must be paid wages in exchange for your work or labour. If you are a volunteer, you will not be paid. Therefore, you will not be working under an employment contract.

Q&A: State or national for WA employees

Q&A: Employee types for WA employees

Q&A: Dismissal for WA employees

Q&A: Contractor or employee for WA workers

Q&A: Meetings and other internal processes for WA employees

Claim guide: Breach of contract for WA employees

Claim guide: Denial of contractual benefits for WA employees

Fair Work Ombudsman

https://www.fairwork.gov.au/

Fair Work Commission

https://www.fwc.gov.au/

Wageline

dmirs.wa.gov.au/contactwageline

Western Australian Industrial Relations Commission

https://www.wairc.wa.gov.au/