Overview
The Fair Work Amendment (Secure Jobs, Better Pay) Act 2022 (FW Act) was passed on December 2. The Bill represents the most substantial set of amendments ever made to the Fair Work Act 2009 (Cth) (FW Act).
There is so much detail in the amendments made by the FW Act it is almost impossible to cover everything in this article, but we explain below the changes that are most likely to impact on Members who employ, and have broken into key categories.
The change to the FW Act now includes two new objectives – gender equity and job security.
Gender equity considerations by FWC includes:
• Comparisons within and between occupations and industries
• Whether historical undervaluing of work on basis of gender
• Fair work instrument or state industrial instruments.
- Equal Remuneration Order as of 7 December 2022.
- FWC consideration of work value reasons to be free of assumptions based on gender and must consider whether historically the work has been undervalued because of such assumptions.
- FWC can make ERO at its own initiative or on application by an employee, employee organisation or Sex Discrimination Commissioner
- Gender equity considerations by FWC include:
- Comparisons within and between occupations and industries
- Whether historical undervaluing of work on basis of gender
- Fair work instrument or state industrial instrument
- From 6 March 2023, expert panels established to consider and decide on making ERO and determinations including for the care and community sector.
- Changes intended to address issues relating to gender pay gap and allow FWC to make EROs at its own initiative. [JS1]
What is the change?
Job advertisements (ads) can’t include pay rates that would breach:
• the Fair Work Act, or
• a Fair Work instrument (such as an Award or Enterprise Agreement).
What is the impact on Members who employ?
Employers advertising for job positions where the employee would also be entitled to a periodic pay rate (for example an hourly or weekly rate of pay) need to:
• specify the periodic pay rate that applies, or
• state in the ad that a periodic pay rate will apply.
Members who employ are encouraged to carefully review the Award and Agreement obligations to ensure correct rates are advertised to avoid any exposure. Advice should be sought where any uncertainty exists regarding correct pay rates for both this purpose and compliance generally.
What is the impact on workers?
Job ads can’t include pay rates that undercut employees’ minimum entitlements. This applies to all prospective employees including migrant workers.
When does the amendment come into effect?
These requirements apply from 7 January 2023, regardless of when the ad was originally posted. This means that even if the ad was posted in 2022, the requirement applies to that ad from 7 January 2023.
Pay secrecy clauses prohibit employees from discussing their salary and remuneration. These clauses often direct employees to not discuss their pay with their co-workers.
What is the change?
Pay secrecy clauses are now prohibited in Australia. The amended FW Act now gives employees a ‘workplace right’ to ask other employees about their pay or disclose their salary to other employees.
What is the impact on Members who employ?
Because such disclosure is now considered a “workplace right” under the FW Act, employers cannot include pay secrecy clauses in their employment contract agreement or other written agreements.
What is the impact on workers?
Employees can now discuss their remuneration openly with other employees. However, employees cannot be forced to share their remuneration to other employees if they don’t wish to do so. Moreover, employees may exercise these rights even after they leave employment.
What should employers do now?
Employers should review their template employment contracts to ensure they do not prevent employees from disclosing their pay. Furthermore, it is advisable to consider whether any changes to employee’s remuneration are necessary. For example, employers may want to look more closely at the issue of unequal pay inequality in their workplace.
When does the amendment come into effect?
Any employment contract entered into or amended on or after December 7, 2022, shall acquire such rights on entering into that contract.
However, for some employment contracts, the new legislation has created three levels of commencement:
| Employment contracts entered before December 7, 2022 | Contracts entered into before that date remain valid but are no longer enforceable if the contract is amended. |
| Employment contracts entered on or after December 7, 2022 | This clause is not enforceable and has no effect. |
| Employment contracts entered on or after June 7, 2023 | Pay-secrecy terms will be banned from this date. Employers who violate this prohibition will be subject to penalties. |
Sexual harassment describes a wide range of unwelcome behaviour of a sexual nature that could reasonably be expected to make a person feel offended, humiliated or intimidated.
What is the change?
The amendments in the Fair Work Act 2022 includes some of the recommendations in the Respect@Work Report, which introduces a broad prohibition against sexual harassment in connection with work.
The prohibition applies to the wider definition of ‘worker’ under the Work Health and Safety Act 2011 (Cth), including individuals carrying out work in any capacity for a person conducting a business or undertaking (including, for example, employees, trainees, apprentices, contractors and volunteers).
Fair Work Commission (FWC) can and will deal with disputes other than by arbitration e.g. mediation, conciliation, recommendation or expressed opinion including by making a stop sexual harassment order. Disputes not resolved by the FWC may be dealt with by a court.
What is the impact on Members who employ?
Employers can be held liable for sexual harassment in the workplace unless they can demonstrate policies and reasonable steps to prevent it.
What is the impact on workers?
Employees who are sexually harassed in the workplace may apply to the Commission for compensation and employer penalties through the Commission.
What should employers do now?
Employers should review and update workplace policies, procedures and training to adhere to these changes.
When does the amendment come into effect?
Sexual harassment in connection with work takes effect from 6 March 2023.
Need further clarification?
Please don’t hesitate to reach out to us if you want to discuss your employment plans.
If you would like to discuss the changes more specifically to your employment plan, please don’t hesitate to reach out to us and we are happy to go over what is relevant to you.
