A recent NSW District Court judgment against a real estate principal has prompted the Real Estate Employers’ Federation of NSW (REEF) to change its template employment agreement for operational employees.
In what REEF described as a “shock decision”, the principal was ordered to pay $144,640 to a former property manager for breach of contract based on a verbal agreement.
“The property manager alleged that as part of the agreement for her to move across from one agency to another, she would be paid 20 per cent of the ‘value of the rent portfolio’ provided she remained employed for two years,” REEF said in a recent newsletter titled ‘REEF@WORK’.
“The former property manager’s oral claim was supported by two witnesses – her brother and another former employee of the agency.”
The employer, who cannot be named due to legal reasons, adamantly denies any conversation or agreement taking place and the written contract did not provide details for the proposed entitlements.
In its latest newsletter dated December 2, REEF said the decision “raises the serious question about how an agency can best protect itself against a claim from an employee (or ex-employee) that there is an entitlement to some additional benefit or inducement not contained in the employment contract.
“With this in mind, REEF has decided to amend its template employment agreement for operational employees."
REEF said while the new clause “will offer your agency greater legal protection against claims for some alleged additional promise not contained in the written employment contract…the inclusion of these words is not a 'get out of gaol free card' in the event of such a claim.”
The Real Estate Employers’ Federation of NSW ("REEF") is a state-registered industrial organisation of employers.