Industry insight

After being involved in the dairy industry for 20 years and observing many farm businesses it is clear to me that successful grass growers and successful employers have something in common – they can blend all the ingredients. For growing grass, it’s species, grazing, fertiliser and farm layout. For employment, it’s respect, empathy, communication, clarity, facilities and remuneration.

Whilst remuneration is important for engaging and retaining people, studies have shown that the employers who achieve the highest staff retention rates and productivity measures per person employed are not necessarily the highest paying employers.

The legal requirements of remuneration are important but attract almost too much emphasis. Of far more significance is the need to make the terms of engagement specific, transparent and above all fair. Problems can arise if the employer hasn’t really determined the best way to engage people to work on their farm that will suit the business’ needs. It may sound obvious but in many cases of employment failure, payment, rather than the role and expectations, has been changed to suit the budget.

The key seems to be in evaluating the position from both sides. Successful arrangements are those where the expectations of the employer and employee are met.

John Mulvany
Dairy farm consultant
Gippsland

Introduction

A person working on your farm may be engaged as an employee, a family member, an independent contractor or a share farmer. How they are engaged will determine which laws apply to the working relationship and have implications for the development of an appropriate remuneration package. You may have already considered how people are engaged on your farm as part of the recruitment process, if not you may want to refer to the Recruitment module.

Working out appropriate remuneration packages for the people on your farm is one of the most important elements of people management to get right. Packages must be designed to suit the type of engagement; comply with legislation; be competitive with other dairy farms and other workplaces; and reflect the complexity and responsibilities of the position, and the skill level and experience of the person.

Appropriate remuneration packages can include rewards other than wages or salary. Dairy businesses can offer staff accommodation, telephone, power, vehicle costs, meat and milk, performance incentives, agistment, and young stock as part of the package.

Rewarding people appropriately gives them the incentive to perform at their potential. This may mean that they take on responsibilities, make decisions and give you the chance to step back or perform other tasks in the farm business that you may not presently have time to do.

When you engage people to work on your farm, it is inevitable that at some time the engagement will be terminated. People may voluntarily leave the farm or be dismissed for performance or business reasons. There are legal implications surrounding termination that need to be considered when engaging people and developing contracts, agreements and remuneration packages.

This module helps you through the complexities associated with different ways of engaging people on your farm and developing appropriate remuneration and benefits that comply with your legal obligations.

The industrial relations legislation in Australia is currently undergoing change. This module contains the most recent information available at the time but please check with your legal adviser or state farming organisation and government websites for further updates.

This module was reviewed for The People in Dairy by Jennifer Corkhill.