If you are a retailer in the apparel area, staff wearing your stock can be a great advertisement for your brand. But you need to be aware of the employment law implications.
Most employers in the retail industry are covered by the General Retail Industry Award 2010 (Retail Award). Under the Retail Award, you cannot force your employees to wear your stock, without reimbursing them for the cost of buying that stock or providing the stock to them free of charge. Even if your employee manual or employment contract says that employees must purchase and wear your stock, this will not assist you legally. You must comply with the Retail Award, unless you have an enterprise agreement or other statutory agreement in place.
If you do require employees to wear particular clothing, then your employees may be entitled to be paid a separate laundry allowance under the Retail Award. For a full-time employee the allowance is currently $6.25 per week.
The Fair Work Ombudsman, which is the government office that deals with workplace compliance, has highlighted the issue on its website. The maximum penalty for each breach of an award by a corporation is $51,000. Individuals, such as directors and managers, can be personally liable for such breaches up to a maximum penalty of $10,300 per breach. Further, employees can also make a claim for the reimbursement of clothes that they have been forced to buy.
So what can you do?
- Have an employee wardrobe where employees can choose outfits to wear, but that they do not keep or pay for.
- Require your employees to wear your stock, but supply the stock or reimburse them for the purchase.
- Make it clear that wearing your stock is optional, but encourage employees to wear your stock by providing staff discounts.
- Negotiate an enterprise agreement or individual flexibility agreement with employees that deals with the issue, although you would need to obtain advice about this. There are a number of statutory limitations on the contents of these agreements.
- In some circumstances you can incorporate the laundry allowance into the employee’s above award pay, but you should seek advice about how to make this legally effective.
More information
For more information, please contact David Brown, Principal Lawyer, on (03) 8600 8828 or a member of our Employment and Workplace Relations team on (03) 8600 8888.
Note: This update is a guide only and is not intended to constitute legal advice.