Why you need a Code of Conduct at work

Published: 18th September 2008
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Changes to employment law mean that businesses of all sizes - big and small - are going under increased scrutiny to do right by their employees and stay within the law.

The importance of employment contracts is obvious, but you should also seriously consider having a Code of Conduct for your employees.

While a Code of Conduct is not a legal requirement it makes good business sense to have one and the following provides a few pointers on why it's important....

What is it?

A Code of Conduct provides black and white ground-rules for the professional behaviour and conduct that is expected in your workplace.

The code should also include your Disciplinary Procedure, which is the process to be followed when an employee's behaviour or conduct is in breach of your Code of Conduct.

Why do you need one?

A code provides an open disclosure of the way an organisation operates with clear guidelines for behaviour. It is hard for an employee NOT to know how to act and behave when there is a code in place.

It can be used on a daily basis to guide employees with ways of dealing with the ethical dilemmas, prejudices and grey areas that are encountered in everyday work. In effect a code is meant to complement relevant standards, policies and rules, not to be a substitute for them.

What's in it?

A code of conduct includes a series of company rules and procedures that cover such areas as attendance at work, standard work hours, performance of duties, use of alcohol and prohibited drugs, use of email, Internet and computers, safety procedures, personal behaviour, harassment, gambling etc.

Is a Code of Conduct legally recognised?

Yes. While there is no legal requirement to have a Code of Conduct, it makes good business sense to do so. However, you need to appreciate that if you have a code you must follow it!

This was borne out very clearly in the infamous 2007 Nikolich Case in which Mr Nikolich was awarded more than $515,000 in damages as it was found his employer had failed to act according to its company's workplace polices which were set out in the company's policy document.

The Court ruled that workplace policies are decisive statements and while not necessarily incorporated as part of an employment contract as such they are still considered as terms of an overall Contract.

This is a critically important issue for employers and all managers who are responsible for the content of policies, because if a policy is an employment condition, then an employee will be entitled by law to sue his or her employer for a breach of that policy and may be entitled to compensation.

Given this employers need to be mindful of the wording they use in their Code of Conduct and regularly review their policies and procedures to ensure they remain relevant given current employment law.

Most importantly employers need to know their policies inside out and ensure all staff abide by them. At the end of the day the purpose of having a Code is to set standards that make the workplace a happy and healthy place to be, so there are many benefits for having one in place and for regularly reviewing it.

Want to know more?

More information and insight can be obtained from www.workforceguardian.com.au - Australia's most comprehensive inexpensive online employment relations service that helps employers navigate confusing employment law in order to properly hire, manage and exit employees:

•Fully compliant Employment Contracts and Independent Contractor Agreements - easy and quick to create using an interview style format,

•Step-by-step employment processes and legally compliant document templates such as employee evaluation forms and employee termination forms,

•Central and secure round the clock storage of sensitive employee information,

•Expert employment relations advice when needed,

•Verified by Clayton Utz and available via the web 24/7.


This article is intended to provide commentary and general information. It should not be relied upon as legal advice. Formal legal advice may be necessary in particular transactions or on matters of interest arising from this article. Workforce Guardian Pty Ltd is not responsible for the results of any actions taken on the basis of information in this article, nor for any error or omission in this article.

Adrienne Unkovich, MD, is part of the team at Workforce Guardian, Australia's number one online employment relations service. For more information on how Workforce Guardian can help your firm meet HR compliance laws, click here.

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