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Dismissing staff is a part of life for fast- Essential ingredient: The Chefs
growing companies – the skills these companies Toolbox founder David Mills
need from their employees change as they focuses on hiring the right people
Staff
grow, and small companies cannot afford to
carry the non-performers, who can hide in Managing director Jonathan Dutton of
the ranks of bigger companies. CIPS Australia, a professional association for
“It is never fun to let someone go,” former procurement professionals, says “we need a
without
investment banker David Mills says. Since he flexible workforce as we go through different
started his company The Chefs Toolbox, which stages of growth”. The organisation employs
sells kitchenware by party plan, Mills has had to nine full-time-equivalent staff members, and
sack four staff. “With two, we couldn’t get the has another 18 part-time staff and contractors.
StreSS
right behaviour, no matter what we did. With “We grew 78 per cent in [revenue] last year
the others, we had a change in requirements.” and 176 per cent the previous year,” Dutton
WorkChoices, the industrial relations laws says. “That demands different skills. Without
introduced by the former federal government, the [WorkChoices] legislation, taking on a full-
allowed small businesses with fewer than time employee is a huge commitment.”
100 staff exemption from unfair-dismissal laws. Dutton says he would employ more staff and
Easier dismissal meant easier employment for grow faster if the old regime had continued.
small businesses. Fast-growing companies could Because of the changes, he is employing more
employ new staff without fear of time-consuming casual staff. “We offer professional part-time
or costly challenges if they needed to sack people. jobs: marketing, an education manager, a
With changes to industrial relations laws, finance manager and a copywriter,” he says.
Fast starters, cautious unfair-dismissal rules are much tighter:
companies with up to 15 employees can
“We find that women returning from maternity
leave want part-time work.”
about hire-and-Fire extend probation to 12 months before they
must comply with the new laws, governed by
Each time Mills sacked staff from The
Chefs Toolbox, he paid them more than their
Flexibility, are keeping a fair-dismissal code, now being written in
consultation with small and big business groups.
entitlements. “We would have a cheque ready.
The tears dry up then,” he says. “All your
a close eye on the new In a downturn, a dismissal is a redundancy and
does not come under unfair-dismissal laws.
remaining staff watch how you treat people.
People on low to mid-levels are not likely to
unFair-dismissal laws. BRW Fast Starters companies surveyed felt
protected by the WorkChoices unfair-dismissal
push too hard, but you don’t want to risk it. We
erred on the generous side.”
Nicolas Walker
report: kath walters rules. Although 68 per cent felt the imminent
changes will have no effect on their hiring
decisions, the rest have doubts.
Expensive senior roles cause fast-growing
companies the biggest worries. Being unable
to sack a poor performer is what disturbs
68 April 24–June 4 2008 | www.brw.com.au
the sleep of Nicson White, founder of the
mattress-sanitising franchise Health Protect
International. With changes to the laws, White
has opted to put his senior staff on contracts.
“[The new laws] make you ask the question
‘Why hire?’,” White says. “You can have
consultants on a contract basis, and they are
working 100 per cent for you and only for you.”
White says that being sued for unfair
dismissal would probably destroy his fledgling
company, which employs six full-time staff
and has increased revenue by 230 per cent
over the past year.
Fast Starters cannot afford to stop hiring,
whatever the laws — the prospect of being
without enough staff is even scarier than hiring
the wrong ones. In a survey of the Fast Starters,
74 per cent said finding staff was the hardest
part of starting their business, and 68 per
cent said changes to the laws would have no
effect on their hiring decisions.
Profusion Group recruits executives for the
banking and finance sector, and business is
booming. But co-founder Rodney Jones has had
to recruit from overseas to fill positions within
his own company. “Australia is a place where What else
people want to come and live and work,” he
says. “We find it easier to attract people from
governments
overseas than from larger corporations.” should do
Jones says big companies beat him on the pay
and conditions they offer staff. “And staff see • Buy more locally made
a move to a smaller company, no matter how products and services
strong the brand, as more risky.” Of his 32 staff, • Provide grants for sales
four are sponsored from the United Kingdom, and marketing
but Jones says the government could make • Make it easier to hire
it easier and cheaper. “You have to employ skilled migrants
a lawyer, and the process can take up to two • Introduce a world-class
months. There is also a limit on the number broadband network
of foreigners you can bring in as a proportion
of your staff.”
More than 90 per cent of Fast Starters have
employed a staff member within a year of
starting business, and 36 per cent within a Tax wish list
week. Leading Mobiles, a Telstra mobile phone
dealer, had so much trouble finding the right • A tax honeymoon in
people that it started its own recruitment the start-up phase
company. Director Allister Lewison says the • Abolition of payroll taxes
high employment rate means some staff move • Reduce the number
between jobs rather than working hard for a of taxes
promotion. “They move because they can,” • Simplify compliance
he says. “There are so many jobs.”
Lewison has become more cautious about
hiring, and has introduced more paperwork
to cover himself. He stopped using external
recruitment companies because many of his
recruits did not stay. He started a recruitment
service as a separate business and found
better candidates, with enough left over
to provide to others.
