Keeping up with the Employment Law Changes
We summarise the key Employment Law changes from December 2022, and those coming this year!
As you are no doubt aware, there have been a multitude of legal changes in Australian Employment law over the last 2 years. To ensure you haven’t missed anything, we summarise the key changes to workplace laws of particular interest to small / medium businesses. The key changes you need to be aware of, and take action of..
- Pay secrecy;
- Sexual harassment;
- Flexible working arrangements;
- Fixed-term contracts;
- Employee deductions;
- Superannuation; and
- Unpaid parental leave.
As always you need to ensure you policies and processes are robust and up-to-date. Ensure you are compliant with legislation and have appropriate insurance in place.
We always recommend that those businesses that do not have a HR function, ensure they are compliant using a reputable HR company that can audit and determine compliance with law but also ensure you have a great people strategy that supports your business strategy, including scaling and growing.
Pay Secrecy Clauses
Employees have a new workplace right to choose whether or not to disclose information about their pay and their employment terms and conditions that may determine their pay outcomes. Employees will also have a workplace right to ask other employees (with the same or a different employer) about their pay and other related terms and conditions of their employment.
This means that if an employee is subject to adverse action because the employee disclosed their remuneration, the employee can bring a General Protections claim against the employer in the Fair Work Commission. In addition, the change also prohibits employers from including pay secrecy clauses in employment contracts.
Action Step: Determine how your business will deal with pay discrepancy issues and review new contracts to ensure pay secrecy clauses are not in the confidentiality section or other sections of the Employment Agreement. Remember you cannot enforce confidentiality sections of old contracts either.
While sexual discrimination and harassment in the workplace were already unlawful, employers will now have to take more proactive measures to prevent and eliminate it. I.e. must take a proactive risk-assessment, approach.
The Secure Jobs, Better Pay Act made new provisions into the Fair Work Act, making it unlawful for one person to sexually harass another person in connection with work. This prohibition extends to all ‘workers’, including employees, contractors, subcontractors, outworkers, apprentices, trainees, students gaining work experience, or volunteers, as well as prospective workers and third parties such as clients and customers. Under the Fair Work Act, workers, prospective workers and persons conducting/undertaking a business will each be able to seek remedies.
Under these changes, the Fair Work Commission will have powers to:
- Make stop sexual harassment orders to protect applicants from future harm; and
- Deal with the dispute under a new dispute ordering compensation to remedy past harm through conciliation. If the dispute cannot be resolved, the parties can have the matter arbitrated in the Fair Work Commission, or the worker can proceed to make a claim in the Federal Court or the Federal Circuit and Family Court of Australia.
Action Step: Ensure you create the right policies and processes, great leadership and an inclusive, thriving culture that ensures any type of discrimination, harassment or bullying is not tolerated and dealt with promptly if required.
Right to Request Flexible Working Arrangements
The law provides a minimum process employers must follow when receiving an employee’s request for flexible work arrangements has become more onerous since employers must act, within 21 days of receiving the request:
- Approve the request; or
- Have discussed and agreed with the employee changes to the employee’s requested work arrangement; or
- Have discussed the proposed arrangement with the employee and must set out the reasonable business grounds on which they refuse to grant the request.
There is also an increased access to dispute resolution through the Fair Work Commission for employees, in circumstances where a dispute regarding a flexible working request cannot be resolved.
This amendment strengthens the right to request flexible working arrangements. Employees can negotiate workplace flexibilities and can bring a dispute to the Fair Work Commission if the employer refuses their request or fails to respond within 21 days. The Fair Work Commission also has the power to make a number of orders when arbitrating the dispute.
Action Step: We work with businesses of all sizes to create a Psychologically Safe, High Performance Culture, based on trust where flexibility is a the core of the People Strategy. It is important for employers to recognise that all employees are looking for more life and more flexibility and we would suggest making the process as simple as possible. Whilst we recognise flexibility/remote-working/hybrid working can be difficult for some businesses and roles, we believe businesses should take a holistic talent attraction, retention and engagement focus to their People Strategy, Policies, Processes and Leadership.
The law now states, with limited exceptions, employers will no longer be able to employ an employee on a fixed-term contract that:
- Exceeds two years (including extensions);
- Contains the right to extend or renew the contract more than once; or
- If a new contract:
- Where the employee has previously been engaged on two consecutive contracts for the same or substantially similar work;
- Where there may be substantial continuity of the employment relationship between the end of the previous contract and the new contract. By way of an example, a contract that finishes at the end of one semester and another contract that starts at the beginning of the next semester.
Employers are now required to give employees engaged on a fixed-term contract a ‘Fixed-Term Contract Information Statement’. This is found on the Fair Work Commission’s website.
The Fair Work Commission will have the power to hear any disputes arising as a result of the fixed-term contract. Employers will have the onus to establish that their fixed-term contracts are not in breach of the legislative requirements.
Action Step: We always encourage employers to be flexible with short-term contracts and keep them to time frames that are relevant to the project/work required. Please contact us to discuss win-win practices to ensure you stay within the law but gain the flexibility you need!
Authorised Employee Deductions
The new law allows employees to authorise recurring deductions. Employees can have money withdrawn from their salary regularly, even if the amount sometimes changes. This agreement stays valid even if the deduction amounts increase or decrease. And if employees want to stop these deductions, they can write a simple note to their employer.
Previously, employees had to sign a new form every time the deduction amount changed. But now, this extra paperwork is gone, making it much simpler to manage salary deductions.
Action Step: Make sure you have a simple process for ensuring deductions are made correctly.
Superannuation Rule (Effective 1 January, 2024)
The new rules/law says employers must pay superannuation based on the employee’s ordinary work hours. This rule just reinforces that superannuation is an integral part of the employee’s remuneration package.
Action Step: Ensure your payroll function is not only paying people correctly, but is also calculating superannuation correctly.
Unpaid Parental Leave (Effective 1 July, 2024)
The new provisions of the Fair Work Act allows employees to take unpaid leave when they have a new child.
The new rules will make it easier for employees to take unpaid leave to care for their new baby. Previously, employees could take up to 30 days’ leave in the first year. But now, they can take up to 100 days’ leave whenever they want in the two years after the baby is born or placed with them. In addition, employees can take unpaid leave up to 6 weeks before the due date if they are expecting a baby.
There used to be a rule saying both parents could not take more than 8 weeks’ leave. That rule is gone now. This means both parents can take up to a whole year off whenever they want in the first two years after the birth of their child. And if they both want more time, they can each apply for an extra 12 months after the first year. So, in total, both parents can take up to 2 years’ leave unpaid if they want to.
Action Step: Review your Parental Leave policy and consider making Parental Leave more of a benefit to attract and retain your talent.
Where To Get More Information
If you would like more information on how we can help, get in touch! We help businesses and leaders to grow and thrive more, creating amazing workplaces. If you need help with any of these things, give us a call today on 1300 795 106!. We are here to help.
Thank you to our great partner Concord Lawyers for assisting with this article.
Disclaimer: This article is intended to provide commentary and general information only. It should not be relied upon as comprehensive advice. Formal coaching or advice may be necessary for matters of interest arising from this article. The HR Experts International is not responsible for the results of any actions or inactions taken on the basis of information in this article, nor for any error or omission in this article