Inflexible pricing and high fees by legal firms are pushing many smaller employers to “go it alone” in navigating Australia’s complex employment regulations, an employment lawyer has warned, with potentially damaging results for businesses.
Thea Birss, a senior associate at Adelaide firm NDA Law, said that the complexity of Australia’s workplace laws means businesses need advice to avoid falling afoul of the rules. But for many, the cost of legal services is prohibitive or even make them inaccessible.
This, she said, is causing many SME owners to try and muddle through themselves.
“Business owners need to accept it’s their job to ensure they are compliant, but it’s also true that our workplace laws are absurdly complex, with many full-time HR managers in big companies struggling to understand them,” Ms Birss said.
“The government could help a lot by moving to simplify laws for the sake of SMEs that represent 90 per cent of Australian businesses.
“Smaller business owners often don’t have the in-house knowledge to deal with important issues as they arise. But they need to seek workplace advice before making decisions that could cost them later if an unfair dismissal case is taken to Fair Work, or if you can run a truck through their employment contracts.”
Ms Birss said that “SMEs have no problems using an accountant”, but suggested that the same cannot be said of lawyers.
“They should think the same way about engaging a workplace lawyer. It’s all about managing risk,” she said.
The cost of legal advice — or even the perceived cost — is driving many business owners away from seeking this expertise, Ms Birss said.
Adding to this, she said, is that many law firms are geared towards the corporate sector, making it difficult to find a lawyer who wants to deal with an SME, let alone one which offers more flexible pricing options for smaller businesses.
“Knowing in advance how much they will pay for advice makes it easier for business owners to pick up the phone and get help — and to avoid making big mistakes.”
Those mistakes, the lawyer warned, can include poorly worded employment contracts, unfair dismissals and contractor arrangements that are non-compliant, all of which expose the business to risk.
“Too many business owners still rate cash flow or customer retention as their number one priority, but increasingly, it’s workplace compliance and employee health and safety that could be the biggest threat to their operations,” Ms Birss said.
“Most SMEs are time-poor and already struggling with obligations like Single Touch Payroll and the GST. They may not be aware they are paying their staff less than they should, and probably don’t have the correct OH&S systems in place to protect themselves if an employee brings a claim or gets hurt at work.
“But that excuse won’t help them if Fair Work comes knocking.”
She concluded by stating that “businesses must be able to access affordable advice so they can ask questions about pay and conditions, safety regulations and contracts”.
“We also need to provide more avenues for education around Fair Work regulations so people will actively seek help before it becomes an issue.”
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.
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