The Cleaning Award has provisions to cover the situation when a cleaning contract changes from one cleaning contractor (the outgoing contractor) to another (the incoming contractor). The outgoing contractor is the one whose contract has ended, and the incoming contractor is the new employer taking over the outgoing contractor’s business or cleaning services contract.
Example
Christine’s Crystal Cleaning Services has the contract to clean a shopping centre. When the contract terms expire, the owner of Christine’s Crystal Cleaning Services decides not to extend the contract as they want to supply cleaning services only for corporate businesses to limit the hours of operation. The shopping centre enters into a new contract with Twenty4 Hour Cleaning Company. Christine’s Crystal Cleaning Services is the outgoing contractor, and Twenty4 Hour Cleaning Company is the incoming contractor.
If an employee loses their job because of a change of contract, then they may be entitled to receive redundancy pay. For more information about redundancy, visit the Redundancy page.
If an employee is employed in a similar position with the incoming contractor and the outgoing contractor has paid the employee all of their outstanding entitlements (including any annual leave, long service leave, notice of termination and wages), then the employee is not entitled to receive redundancy pay. This is also the case if the employee continues to be employed by the outgoing contractor (for example if they started working on a different contract).
Notice of termination
The requirement to notify your employees that a contract they are working on is due to expire, or has been terminated, 28 days before it ends is not notice of termination. If your employees are being made redundant as a result of the contract ending, you must also provide them with the correct amount of notice of termination and this will be based on the amount of time that they have been working for your business. If you don’t, you may need to pay them instead of giving them notice.
Example
Miranda is 27 years old and has been employed by Christine’s Crystal Cleaning Services as a cleaner for the last 2 years. During this time, she has been working on the shopping centre cleaning contract. When her employer decides not to extend the contract, she is offered to continue working in the same position for the incoming contractor - Twenty4 Hour Cleaning Company.
Miranda is given notice of termination 2 weeks prior to this change and is consulted by the manager of Christine’s Crystal Cleaning Services. She is also paid out all of her entitlements on her final day. Because her new position is the same as the previous job and her entitlements have been paid out to her, she is not entitled to redundancy pay.
Important! If you are buying or selling your business or if you have taken over a part of another business through an outsourcing arrangement, then you should find out whether a transfer of business has occurred. This could affect your minimum obligations.
Consultation regarding change of contract
If you have made a decision to give up a cleaning contract, or a decision is made by your client that is likely to bring about a change of contract, you must:
- notify your employees 28 days, or as soon as possible, before an existing contract is due to expire, or when you have been notified that the contract has been terminated
- notify your employees of the changes in writing, including suitable options of other employment (if any)
- notify your employees if they have been offered suitable employment, including where they will be working, the hours of work and the rates of pay that they will be entitled to.