What is the Act about? 

The Labor Government’s highly anticipated¹ Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 was passed into law on 6 December 2022.

This Act changes a variety of aspects of Australian labour law, such as enterprise bargaining, fixed-term employment agreements, and gender equality at work. 

These modifications to the federal industrial relations system are widely considered the most significant changes since the introduction of the Fair Work Act 2009 (Cth).

Below, we breakdown some of the key changes:

Restrictions to Pay Secrecy

To bolster the effort to equalise the gender pay gap, employers can no longer ask employees to keep their remuneration confidential. The Act makes provisions for employees to  freely ask co-workers about their pay and it is an employee’s workplace right to decide whether to disclose, or not to disclose that information about their remuneration.

• From 7 December 2022, contracts or variations to existing contracts that contain a ‘pay secrecy’ clause, will contravene the Act.

Sexual Harassment in the Workplace

Under the Act, from 6 March 2023, sexual harassment in the workplace is expressly prohibited.  Any ‘worker’, ‘prospective worker’ or ‘third party’ (i.e. employee, contractor, subcontractor, apprentice, trainee, student, volunteer, clients and customers) will be able to seek remedies under the Fair Work Act where there has been a breach in this express prohibition.

Further changes under the Act means that an aggrieved person may seek remedy from their employer where it’s determined that the employer did not take all reasonable steps to prevent the sexual harassment.

Flexible Work Requests

From 6 June 2023, employers will be required to give greater consideration to flexible work requests by ensuring that before any such request is refused that they have:

1) meet with the employee to discuss their flexible work request and,

2) discuss, canvass and negotiate any alternate work arrangements that may suit both parties.

Also note that the circumstances where an employee can request a flexible work arrangement has been broadened to include where an employee, or their family/household member experiences family and domestic violence.

Changes to Fixed Term Contracting

The Act places limitations on fixed term employment conditions in an effort to promote stable, long-term employment; reduce sham contracting; and reduce the use of fixed term contracting overall.

From 6 December 2023, fixed term contracts will:

1. no longer be able to exceed two years (unless the circumstances meet certain exemption rules); and
2. the parties to a fixed term contract may only engage in a maximum of two consecutive fixed term contracts.

The modifications will include a civil remedy clause, making businesses that place workers on rolling or extended fixed-term contracts subject to financial repercussions.  The FWC has been granted power to resolve any dispute relating to these changes.

Abolishment of the Australian Building and Construction Commission (ABCC) ²

For those operating in the building and construction industry, you’re likely aware of the ABCC which was implemented in 2005 as the building industry watchdog and responsible for taking legal action for breaches of the Fair Work Act 2009 (Cth). As a result of the changes to the legislation, the Fair Work Ombudsmen (FWO) will now be the workplace regulator for the building and construction industry.

What can you do to ensure compliance with these changes ?

• Pay Secrecy Policy – Employers should take action now to review employment contracts and policies for any reference to clauses around pay secrecy or the requirement for employees to maintain confidentiality around their remuneration.
• Prohibition of Sexual Harassment– as suggested in our recent blog post about the Respect@Work Bill 2022, the key will be communication across the organisation around its commitment to prohibiting sexual harassment in the workplace and creating a safe environment for employees to raise grievances. We highly recommend teams and leaders undertake training in this area to assist in compliance of this change.
• Flexible Work Requests – ensure you have a clearly defined policy and procedure for how requests are received, reviewed and handled.
• Fixed Term Contracts:
  • Review the length of time any current employees have been engaged on fixed term contracts. Consider the typical length of a fixed term contract in your organisation and whether the now imposed limit of two consecutive fixed term contracts, for a total maximum of two (2) years will change your approach.
  • Keep an eye out for the Fixed Term Information Statement, soon to be released by the Fair Work Ombudsmen. Like the Fair Work Information Statement and Casual Employment Information Statement, this will need to be provided to fixed term contract employees upon commencement.

Nick Hedges is the founder of Resolve HR, a Sydney-based HR consultancy specialising in providing workplace advice to managers and business owners. He recently published his first book, “Exiting underperforming Team Members – The Inside Scoop”. It is a practical response to the most pressing HR challenges, which can be found at https://resolvehr.com.au/.

Disclaimer: The contents written do not constitute legal advice and does not cater for individual circumstances.   The information contained herein is not intended to be a substitute for legal advice and should not be relied upon as such.

Sources:

1. Smith, S 2022 ‘IR Bill will smash productivity, investment and jobs’, Australian Financial Review, October 21, 2022, Accessed 10^th December 2022 https://www.afr.com/politics/federal/ir-bill-will-smash-productivity-investment-and-jobs-20221027-p5btdw 
2. Australian Building and Construction Commission 2022, Secure Jobs, Better Pay Act now in force, media release, accessed 10^th December 2022 https://www.abcc.gov.au/news-and-media/secure-jobs-better-pay-act-now-force

Additional sources analysing the changes under the Act:

‘Secure Jobs, Better Pay: Your Guide to the Reforms’, Clayton Utz, 6^th December 2022, Accessed 9^th December 2022, https://www.claytonutz.com/knowledge/2022/december/secure-jobs-better-pay-your-guide-to-the-reforms#scrollspy-1

Munton, J & Lorraine, P, 2022 ‘Changes to employment contract practices based on the Secure Jobs, Better Pay Bill’, HRM Online 9 December, accessed 10th December 2022 https://www.hrmonline.com.au/employment-law/employment-contract-secure-jobs-better-pay-bill/

Bell, M & Kamleh, J 2022 ‘Fair Work Legislation Amendment ( Secure Jobs, Better Pay) Bill 2022’, Norton Rose Fulbright December 2022, Accessed 10^th December 2022 https://www.nortonrosefulbright.com/en/knowledge/publications/c01634c1/fair-work-legislation-amendment-bill-2022-becomes-law