This information is only relevant to employers and employees in the WA state industrial relations system – sole traders, unincorporated partnerships, unincorporated trusts and some incorporated or not for profit organisations. Find out more on the Guide to who is in the WA state system page.
If you operate or are employed by a Pty Ltd business – you can find information on this topic on the Fair Work Ombudsman website.
About employment contracts
When an employer offers someone a job, an employment contract is being entered into. This is a legal relationship under which both the employer and the employee have rights and obligations.
Generally an employment contract is made between the employer and a new employee when:
- there is an offer of employment, verbally or in writing and the offer is accepted by the employee
- each party has accepted an obligation to perform their part of the agreement, and the employee will receive a regular wage and generally other entitlements such as leave and superannuation payments in return for working
- the employee will perform work under the direction of the employer and will work the hours determined by the employer
- the employer is responsible for making income tax deductions for the employee.
There is no legal requirement to have a written employment contract with an employee, but it is good business practice and an important safeguard to document what has been agreed between employer and employee about pay, hours and other conditions. If there is ever a dispute about employment entitlements, it is difficult to prove what was agreed without something in writing.
Employment contracts must meet WA award and minimum wage rates
In the state system, many employees are covered by a WA award. WA awards are legal documents that outline legal pay rates, allowances, working hours, and leave entitlements for employees in a particular industry or type of work.
Award coverage is based on the type of work an employee performs and the industry of their employer, and each WA award contains a clause which specifies who that award covers. For example, the Restaurant, Tearoom and Catering Workers Award applies to counter hands, wait staff and kitchen staff working in restaurants, cafes and take away food businesses. The WA awards for common jobs page outlines some of the most common jobs and the relevant WA awards that apply to employees in state system businesses. If an employee is covered by a WA award, the pay rates, leave entitlements, allowances and penalty rates (such as higher pay for working on the weekend or a public holiday) outlined in the WA award must be provided to the employee.
If an employee is not covered by a WA award, the current minimum rate of pay and the leave entitlements in the Minimum Conditions of Employment Act 1993 are the minimum legal entitlements of the employee. It is unlawful to provide pay rates or leave conditions below these standards. Visit the Minimum rates of pay for award free employees page for more information.
An employment contract is not valid if it provides lower wages than the wages in a WA award that covers the employee, or lower wages than the state minimum wage if the employee is award free.
It is unlawful for you to negotiate or come to an agreement with your employee to ignore or provide lower wages that the relevant WA award or minimum wage.
The What to include in an employment contract page highlights key information which could be included.
Have you checked whether a WA award applies to the employee?
The WA awards for common jobs page outlines some of the most common jobs and the relevatn WA awards that apply when people are working for state system employers.
Wageline can also provide information on WA award coverage - call Wageline on 1300 655 266.