Modern awards include standard provisions on consultation which require employers to consult employees (and their nominated representatives) on matters which are likely to have "significant effects" on the employees concerned.

According to the standard award clause, "significant effects" include:

• termination of employment,
• major changes in composition, operation or size of the employer's workforce or in the skills required;
• the elimination or diminution of job opportunities, promotion opportunities or job tenure;
• the alteration of hours of work;
• the need for retraining or transfer of employees to other work or locations; and
• the restructuring of jobs.

There is nothing really new in this - the consultation clauses in modern awards are essentially the same as those that have applied under awards for the past twenty years.

Similar duties to consult with employees are imposed on employers in other areas such as occupational health and safety as well.

For employers who are switched on, these duties will not have much effect at all because they will already be consulting their people on matters impacting on their business and their people.

By consultation, we mean:

1. Explaining to people what the issue is and why it is an issue
2. Explaining the employer's view on how the issue is to be dealt with and what the effects of that are likely to be (in some cases, there might be different options that the employer could consider or it might be necessary to set up some sort of consultative committee to explore the issues and options)
3. Asking people for their views and ideas
4. Listening to them and considering their input
5. Reaching informed conclusions and explaining these to employees.
6. Implementing the decisions while keeping people informed and keeping the door open for any new ideas.

Why is this the smart thing to do anyway?

1. Because it is right to show respect for your people by consulting them 
2. Because people will respect you for doing it (it adds to the relationship)
3. Because you will have difficulty getting people to do what you want them to do or to think the way that you want them to if you don't consult them
4. Because every person who works with you has their own collection of knowledge, skills and experience and, if you do not consult, you are potentially missing out on a big part of the return on your investment in people
5. Because everyone has the potential to come up with an idea (an initiative or a solution) or to contribute to an improvement in some way if they are given the opportunity
6. Because this provides learning opportunities for people
7. Because this provides you with the opportunity to discover and utilise hidden talents of your people
8. Because this helps you to retain valuable people of all generations (especially Gen Y)
9. Because, given all of the above, this will make for a happy and aligned workforce and
10. Because this will give you a competitive commercial edge on your competitors.  

So, for the switched on employer, consultation is a smart business practice which adds value and reduces risk and not just a painful obligation that has to be complied with.