As an employer, you may be aware that on 27 October 2022, the Australian Government introduced the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022 (the Bill) into Parliament. The Bill marks a new era of reform to the legal framework that underpins Australia's workplace relations system. As signalled by the Government's recent election campaign and September's Jobs and Skills Summit, the Bill proposes many notable changes to the Fair Work Act 2009 (the Act), including employment arrangements and the enterprise bargaining and agreement system. This article outlines the Bill's proposed changes and the immediate steps you should take in preparation.
Proposed Changes
The Bill includes a range of proposed changes that will have implications for your business if passed into law. We have listed the Bill's proposed changes below.
Employment Arrangements
The Bill proposes to:
- limit fixed-term contracts for the same role so that employers cannot use them for longer than two years or more than one time;
- prohibit pay secrecy clauses in employment agreements and job advertisements where the rate of pay is below the national minimum wage;
- create a workplace right that will allow employees to question each other about their remuneration and conditions of employment; and
- flexible work arrangements to include caring for family members who are over 55, or who are in family and domestic violence circumstances.
Some reforms foreshadowed by the Federal Government are not included in the Bill, including the "same job, same pay" arrangements for labour hire and independent contractors. Additionally, the Bill does not allow the Fair Work Commission to regulate "employee-like" workers in the gig economy. As such, employers should be prepared for future changes beyond those outlined in the Bill.
Workplace Harassment and Discrimination
In addition, the Bill provides:
- an express prohibition on sexual harassment, accompanied by a resolution process in the Fair Work Commission (the Commission); and
- further protections for intersex status, gender identity and breastfeeding.
Enterprise Agreements
In terms of enterprise bargaining, the Bill:
- provides broader access to both single and multi-employer enterprise bargaining;
- shortens the approval process for enterprise agreements; and
- increases the flexibility of the Better Off Overall Test.
Fair Work Commission
The Bill also:
- provides the Commission with powers to arbitrate disputes with flexible work arrangement applications and to order pay increases for workers in low-paid and female-majority industries;
- establishes two new Commission expert panels for pay equity and the care and community sector;
- abolishes the Registered Organisations Commission and transfers its existing functions to the Commission; and
- abolishes the Australian Building and Construction Commission and repeals the Code for the Tendering and Performance of Building Work 2016, with the Fair Work Ombudsman to take responsibility for the regulation of the building and construction industry.
In addition to the Bill's proposed changes, Parliament has passed recent laws concerning family and domestic violence leave. From 1 February 2023 (or 1 August 2023 for employers who are small businesses), all employees, including those who are casual and part-time, will be entitled to 10 days of paid family and domestic violence leave each year. This change forms part of the National Employment Standards.
As an Employer, Do You Need To Take Any Immediate Action?
The Federal Government has outlined their desire for Parliament to pass the Bill by the end of 2022. Accordingly, they have already begun consulting with employers, unions and other organisations to meet this proposed timeline.
Currently, it would be beneficial for employers to:
- consider their processes around future requests for paid family and domestic violence leave;
- ensure they make any necessary changes to their payroll systems to account for the increase in this leave entitlement; and
- make employees aware of their entitlements as of 1 February 2023, notably the increase from 5 to 10 days for paid family and domestic violence leave.
Concerning the Bill's possible implications, it would be beneficial for employers to:
- conduct a review of any existing fixed-term employment contracts;
- determine if pay secrecy clauses are present in any existing employment contracts or master templates;
- consider how they handle requests for flexible work arrangements; and
- be prepared to update workplace policies and procedures regarding sexual harassment and discrimination.
Key Takeaways
The Bill includes a broad range of proposed changes that will bring considerable reform to Australia's workplace relations system. Hence, employers must be prepared to respond to these changes by reviewing relevant employment agreements, workplace policies and procedures. This will ensure employers can make prompt changes in their workplace if the Bill passes into law.