VIC Employee Decision on Novation of Contract?

[johnnyyue001]

Firstly, want to thank all on this forum because your ideas and suggestions helped a lot!

My company is a multinational big company and I have been working for its Australian entity as a standard permanent staff from 2015. Earlier this year, the company decided to sell our business line globally as it didn't perform well. It sold 51% share to a fund and still hold remaining 49%. The new company will have a new legal entity in Australia so we need to transfer our contract to it.

I did some Google search and my understanding of this is a Transfer of Business, and what I am going through is called "novation of contract". My new company still has some association with the old one due to this 40% share control.

Now HR told us if we don't sign the new contract, as long as the benefits are exactly the same, we are counted as "voluntarily resigned" from the old company, getting no reimbursement and no package. But I also heard someone say that employees have the right to say no to a new contract, even it is a novation with exactly the same benefit, in such a way employees can stay in the current company or get a redundancy package.

My personal belief is that if it is "like to like", I probably can't say no to a new contract. What are your thoughts?

Thanks!

 

[Rod]

Now HR told us if we don't sign the new contract, as long as the benefits are exactly the same, we are counted as "voluntarily resigned" from the old company, getting no reimbursement and no package.

HR are wrong.

Simplified comment here is either you get paid entitlements, or the entitlements are transferred.

What do you want to happen? Leave with redundancy, or go work with new employer with same entitlements/pay/conditions, or something else?

 

[johnnyyue001]

HR are wrong.

Simplified comment here is either you get paid entitlements, or the entitlements are transferred.

What do you want to happen? Leave with redundancy, or go work with new employer with same entitlements/pay/conditions, or something else?

@Rod, thanks.

personally what I want is a redundancy package. however I did some more google last night: for my case it is asset sales, new employer has association with old employer. Fireworks states that if new employer offer terms and conditions "substantially similar or not less favourable" then I can still refuse to take it but then I need to terminate with od employer WITHOUT redundancy pay.

so now the focus is how to define "not less favourable". I read one paragraph today:

"This is especially important in ensuring that all the employment benefits enjoyed by the employee with the Old Employer are considered, and not only those that appear in the written contract of employment."

so some benefits like annual pay, long service leave, annual leave are in my new offer, but some others I currently have - staff discount, education support, those are not in contract but more in a employee handbook form. I don't know if new offer must also match theses non-contractual benefit

 

[Rod]

Fireworks states that

What is 'Fireworks'? Fairwork? Link please.

BTW, is the new company accepting previous service for redundancy on the same terms as the old employer?

 

[Rod]

FYI, need to find out if not only the pay and conditions are substantially the same, but also that the new employer recognises your service with the old employer for redundancy pay. IE you do not start at year 0 again.

 

[johnnyyue001]

FYI, need to find out if not only the pay and conditions are substantially the same, but also that the new employer recognises your service with the old employer for redundancy pay. IE you do not start at year 0 again.

@Rod, thanks. yes it is fair work, and all the service tenure are recognised and carried over. on this side they are good, only the benefits side bit tricky here.

in terms of not getting redundancy pay, the reference is here:
FAIR WORK ACT 2009 - SECT 122 Transfer of employment situations that affect the obligation to pay redundancy pay. in section (3)

so I need to see what is "considered on an overall basis, no less favourable than"

 

[Rod]

Agreed. So you need to work out what the other benefits are worth to you in $s with the current employer and see if they carry across to the new employer.

You might need to re-negotiate a better package rather than hope on redundancy.

Keep in mind the operation of s 122(4).