Fair Work Legislation Amendment 2022 – What does this mean for employers?

The Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) has recently come into effect, with key changes set to affect all employers. What does this mean for you?

The Act updates several provisions of the Fair Work Act and adds a number of new workplace laws, including pay secrecy clauses, fixed-term or maximum-term contract, flexible working arrangements, bargaining and enterprise agreement and so on.

This article will pick up some changes and discuss what those mean for employers. 

Pay equality

Have you come across an employment contract that prohibits you from discussing your pay with anyone? These are known as pay secrecy clauses and are common in standard form employment contracts.

However, the Bill has recently banned these clauses …

Any new employment contracts entered into on or after 7 December 2022 cannot have its pay secrecy terms enforced. Moreover, from 7 June 2023, pay secrecy terms cannot be included in employment contracts or other agreements. Employers who maintain these pay secrecy terms could face penalties.

It is also important to consider how pay transparency may affect their reputation, personnel morale, and interpersonal connections. It should be thought about whether changing the remuneration is necessary as a result. It is also a good moment to think about how the employer’s  company handles gender pay equity in general.

Fix-term or maximum-term contracts

Employers will not be allowed to sign a fixed-term or maximum-term contract except in limited circumstances under this new legislation. 

Employers should evaluate their current employment arrangements, audit the fixed and maximum-term contracts they have with their employees to find out how long they have had them, including any prior contracts. They also need to review their sample fixed or maximum-term contracts to remove any clauses that give the option to extend or renew the term. If they want to rely on an exception to the restriction on fixed-term contracts, they should also think about including such a clause. 

Flexible working arrangements

The new Act expands the scope for employees to make a flexible working arrangement request. If the employer rejects an employee’s request or does not respond within 21 days, the employee may file a complaint with the Fair Work Commission (‘FWC’). When arbitrating the disputes, the FWC will be able to issue a number of orders within its extensive authority.

Employers should examine their current policies and procedures to make sure they are adhering to their obligations with regard to responding to requests for flexible working arrangements. If an employer denies a request, they must provide justifiable business reasons for doing so.

Bargaining and enterprise agreement 

The Act provides a broader idea of multi-enterprise bargaining, increasing the number of employees covered by enterprise agreements and increasing the likelihood that many companies will be required to engage in joint negotiations. In addition, the FWC will have more authority to arbitrate successfully after issuing statements of intractable negotiation in order to resolve labour disputes. If the parties have been in negotiations for at least 9 months, the FWC may determine that the workplace is intractable to bargaining.

In light of the enhanced union leverage brought about by these laws, the employer should examine if their organisation is likely to be vulnerable to multi-employer negotiating and revise their bargaining methods. It is more important than ever to get ready for negotiations and develop industrial action mitigation tactics. 

Conclusion

The changes of the Act are so extensive that this article only briefly covered some of the changes made by the Amending Act. Employers must therefore adapt to these new changes by evaluating pertinent enterprise agreements, workplace policies, and employee agreements. Likewise, their companies should adjust as necessary to meet its legal duties.

Our team of senior commercial lawyers can help you ensure your policies are up to date with the amendments. Please do not hesitate to contact us today on 1300 337 997, or fill in the form below!