Directors Have Human Resources Responsibilities

Hello, I’m Peter Towers, Managing Director of ESS Small Business and ESS BIZTOOLS.  Welcome to Empowering SMEs.

An awareness of human resources laws and best practices is an important component of a company director’s and committee member’s knowledge base.

Whilst it is true that directors should authorise a company’s human resources system and that it is management’s role to implement that system, directors have an ongoing responsibility to regularly enquire as to the effectiveness of the system.

Many directors of small/medium enterprise companies will also be management team members and they, therefore, have two key responsibilities – as a director, signing off on the human resources policy and monitoring the effectiveness of the system and as a management team member, implementing the human resources’ system.

This awareness requirement commences with the National Employment Standards as outlined in the Fair Work Act.

There are 10-minimum workplace entitlements in the National Employment Standards:

1. Maximum standard working week of 38 hours for full-time employees plus ”reasonable” additional hours.
2. Employee’s right to request flexible working arrangements.
3. Parental and adoption leave.
4. 4 weeks paid annual leave for full-time employees.
5. 10 days paid personal leave.
6. Community service leave.
7. Long service leave
8. Public holidays
9. Notice of termination and redundancy pay
10. All new employees to receive a copy of the Fair Work Information Statement

Directors of companies and committee members of not-for-profits, charities and sporting organisations, need to ensure that the organisation has implemented an appropriate human resources system.

Many businesses have implemented employment HR handbooks to guide management and team members.

Directors and committee members should enquire as to the implementation of items such as:

• applications for employment
• contracts for full-time, part-time and casual staff
• induction process – appointment of a buddy
• employee management especially:
• performance reviews
• exit interviews
• disciplinary matters
• minutes of meeting with employees and a buddy in relation to disciplinary matters
• processes to eliminate bullying, violence and discrimination
• processes for enquiring into any grievances and disputes
• code of conduct for team members and management
• processes for the protection of “whistle-blowers”