Firstly, what is business compliance? Business compliance is an industry term for how well a companyfollows the laws and regulations governing itsbusiness. No one started a business to be an employer. But as your business grows, you bring people on the journey with you. It’s exciting watching dreams become reality but the admin associated with employing people can bring that excitement to a crashing halt. Making sure your business is being compliant shouldn’t be hard so we’ve pulled together our top seven tips to help your company nail their business compliance:
1. Build a collection of business compliant contracts and policies
When you’re employing someone, it’s important to make sure that you have the right contract in place with them. While a handshake deal can be legally enforceable, it’s always best to clearly set out the terms and conditions of employment for both parties. Remember that an employment contract cannot provide for less than the legal minimums set out in the National Employment Standards (NES) or the relevant award. Once you’ve got a contract, you also need to make sure that you have some policies in place. In particular, you need to provide a copy of the NES and the Fair Work Information Statement. It is also recommended that you have a code of conduct and ethics, harassment and bullying policy and a grievance handling policy as a minimum. If you are still not sure about exactly what policies you need for your business, you’re in luck. We’ve put together a guide on all the workplace policies small businesses need from day one. You can thank us later.
2. Understand Fair Work for business compliance
The Fair Work Ombudsman dictates the standard working practices in Australia. They often make changes and rulings that could affect your workplace. They also conduct an annual review of the minimum wage and Modern Awards to ensure they are still fair. To ensure your business is being compliant, it’s best to sign up to their updates to make sure you always have the latest information. You can do this by signing up to their email updates or following them on Twitter.
3. Read up on Single Touch Payroll (STP)
STP became mandatory for all business with more than four employees on 1 July 2019. STP means that businesses must report all tax and superannuation payments to the Australia Tax Office (ATO) at the time a pay event happens. While this might have removed the end of quarter or end of year scramble, it has increased the admin burden for every pay cycle (unless you’re using technology like Employment Hero Payroll that can do it automatically for you). The Government also hinted at increases to the data that they want to collect via STP in the latest budget. To make sure that you fully understand your reporting requirements and you’re up-to-date with any changes, we recommend checking out the ATO website and signing up to their STP updates.
4. Understand how you need to pay your employees
Another top tip for those looking into their business compliance is understanding how you need to pay your employees. Payroll scandals are all too common in Australia, so you want to do right by your business and get it right from the offset. If you’re paying people under a Modern Award, you need to make sure that you calculate their payments correctly. On top of the rate there are allowances, penalty rates and overtime to consider. If you’re manually calculating, triple check that you’ve included everything you need to. It’s also a good idea to still check even if you’re paying a base rate above the Modern Award. Once you’ve included those additional payments that base rate may actually be less than the minimum requirements outlined in the Modern Award.
5. Store employee data securely: business compliance 101
As an employer, you also need to hold some very personal data about your employees like tax file numbers (TFN) and banking details. This information needs to be stored securely and only accessed by the appropriate people at the appropriate time. The Office of the Australian Information Commissioner (OAIC) has some very clear rules that need to be considered when storing personal information – particularly when it comes to TFNs.
6. Talk to a professional
The best way to make sure your business is compliant to get some professional advice. There are a number of companies and consultants out there who help businesses make sure they’re meeting their obligations and protecting their employees. Guess what? Employment Hero is one of those businesses. Our CEO Ben started his career helping small businesses make sure they were doing the right thing. We offer a library of compliant contracts, policies and HR documents ready for you to use in our free account.
7. Build a compliant culture
Another great way to ensure business compliance is to change your company culture. As a small business owner, you’re the leader of your firm, and you set the example for others. If you show that you don’t care about compliance, then neither will your workforce. If you notice that there are areas where your business can improve, consider having a sit-down meeting with the employees involved. Stress to them the areas in which your company is lacking business compliance and why it’s critical to make improvements. There you have it! Seven quick and easy tips that will help make sure your business compliance is all above board.
More ways to work on your business compliance 🚀
There’s plenty more where that came from. Here at Employment Hero, we want to make sure all small businesses have the right information to ensure they are being business and HR compliant. Fill out the form below to download our Essential Guide to HR Compliance. Make sure you’re doing the right thing for your business. 👇