1. Post Employment Restraints aren’t always enforceable
Just because your employment contract includes a non-compete or non-solicitation clause doesn’t mean it will stand up in court. The clause must be reasonable in scope, geography and duration, and tailored to the employee’s role.
2. You can require a health assessment if the employment contract says so
Want to send a worker for a medical review or fitness-for-duty check? Unless there’s an express term in the contract, you may not have the right to require it.
3. Bonus schemes are a legal trap if the discretion isn’t clearly defined
If your employment contracts say a bonus “may be payable at the employer’s discretion,” but doesn’t clearly state how and when discretion is exercised, courts might decide the employee has a right to a bonus based on past practice.
4. You can include a term that allows for lawful stand-downs
While the Fair Work Act 2009 (Cth) gives limited stand-down rights, you can expand this by agreement in an employment contract. This is handy for businesses facing seasonal or unforeseen operational downturns.
5. Fixed-Term Contracts now have limits
Since December 2023, most fixed-term contracts can’t exceed two (2) years (including extensions) unless a specific exception applies, and breaching this rule could mean the worker is considered permanent.
6. A poorly drafted contract won’t protect you
Even if you call someone a “casual” or set a fixed end date in the contract, the Fair Work Commission will look at how the relationship played out in practice. If the employee worked regular hours or was effectively treated as permanent, they might still have access to claims or redundancy pay, irrespective of what the paperwork says.
7. Silence in the employment contract terms can cost you, literally
If you haven’t clearly addressed things like set-off clauses, deductions, or restraint of trade, the law may not provide the protections you think you have. For example, without a clear set-off clause, you could end up paying Award entitlements on top of an annual salary, even if that salary was meant to be “all inclusive”.
Get in touch to discuss your options with our team.