Fair Work amendments: Secure Jobs, Better Pay – what do I need to know?

In this article we focus on the amendments which currently apply or which will commence on 6 March. Further updates will be provided as new amendments become operative throughout the year.

What changed on 7 December 2022?

On 7 December the following amendments commenced:

• The objectives of the Fair Work Act (the Act), were amended to include job security and pay equality;
• An equal remuneration provision was added to the Act to facilitate the varying of Modern Award for work value reasons;
• Pay secrecy provisions commenced;
• The anti-discrimination provisions were amended to include breastfeeding, gender identity and intersex status;
• Changes to applications to terminate enterprise bargaining agreements commenced;
• Changes to the process for initiating enterprise bargaining were commenced; and
• The powers of the Fair Work Commission to deal with errors in enterprise agreements commenced.

Many of the above changes are procedural and are unlikely to impact on the day to day management of a business. However, this is not the case for pay secrecy or the anti-discrimination provisions.

Pay secrecy

It is now a workplace right for employees to be able to ask one another about and to disclose (or choose not to disclose) their remuneration and other conditions of their employment which are reasonably necessary to determine remuneration outcomes such as hours of work.

Employers must not enter into a contract of employment that requires an employee to maintain secrecy about their pay and conditions. If employers already have such provisions in existing contracts of employment or in an industrial instrument, for example as an Enterprise Bargaining Agreement, these provisions no longer have any effect.

Employers must not tell employees that they need to keep their pay and conditions secret. If an employee chooses to disclose this information any punitive action taken by an employer would be “adverse action” for the purposes of the General Protections provisions of the Act.

It is not necessary to amend old contracts of employment, as any secrecy terms no longer have any effect, but no new contracts of employment should include such provisions.

Anti-discrimination

Employers should review their policies and training to ensure that they are updated to include the newly added attributes of breastfeeding, gender identity and intersex status. We would also recommend that employers review any current workplace practices which may result in discrimination on the basis of the new attributes.

Enterprise Bargaining

There are technical changes to the termination of Enterprise Agreements, the process for commencing bargaining for new Agreements and the jurisdiction of the Fair Work Commission to deal with errors in Agreements.  We expect that there will be greater guidance provided by the Fair Work Commission on the practical application of these provisions in the near future.  We will update these aspects of the amendment at that time.   

What changes start on 6 March 2023?

On 6 March 2023 the following amendments commence:

• Provision prohibiting sexual harassment in connection with work;
• The establishment of Expert Panels relating to pay equity and the care and community sector;
• The Fair Work Commission absorbs the functions of the Registered Organisations Commission.

Sexual harassment in connection with work

The extended jurisdiction in relation to sexual harassment creates a substantive obligation on employers to do everything reasonably possible to ensure that sexual harassment does not occur in connection with work. Employers as an absolute minimum need to ensure that their sexual harassment policy is comprehensive and up to date. Further, it is not going to be enough to have a policy, no matter how impressive the policy is, employers must also be providing training to their employees on what may constitute sexual harassment at work and have an effective mechanism to sensitively and appropriately manage events if they arise.

The Fair Work Commission currently has the jurisdiction to issue “stop sexual harassment orders”, however from 6 March 2023 this jurisdiction will be extended and will include the ability to issue an order for payment of compensation, payment in relation to lost remuneration, or to carry out a course of conduct to redress loss or damage suffered by the aggrieved person. The Commission may also express an opinion, including that the respondent has sexually harassed the aggrieved person or that the employer has contravened the Act, by virtue of vicarious liability.

An employer can be found to be vicariously liable for sexual harassment perpetrated by their employee or agent, except where they can prove that they took all reasonable steps to prevent the employee or agent from contravening the relevant provision. Employers without a comprehensive policy and the ability to show appropriate training was provided will struggle to demonstrate that they have taken all reasonable steps to avoid vicarious liability if there is an incident of sexual harassment in connection with work. The Full Federal Court has provided guidance in this regard when it relevantly said:

“The word “all” is significant. It is not enough for the employer to demonstrate that it took some of the reasonable steps available to prevent the employee from doing the unlawful act”. [1]

Further, employers are encouraged to ensure that their managers have the skills and resources to effectively respond to incidents should they arise. Larger employers are encouraged to implement ‘contact officers’ who have additional training and expertise.

What’s next?

Further amendments will commence on 6 June 2023 including in relation to flexible work requests and requests for extension of unpaid parental leave. We will provide an update prior to that date on these pending changes and any actions employers should take to ensure they are prepared to appropriately respond to such applications.

Mazars can provide assistance in preparing for the current and upcoming changes, including the drafting of sexual harassment policies and preparing and/or delivering training. If you require assistance, please speak with your usual Mazars advisor or one of our specialists below.

Author: Cheryl-Anne Laird

Published: 02/03/2023

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[1]Von Schoeler v Allen Taylor and Company Ltd Trading as Boral Timber (No 2) [2020] FCAFC 13