What the changes to Industrial Relations laws mean for you

The immediate change: December 2022

The most immediate change relates to the use of ‘pay secrecy’ clauses in employment contracts.

Historically employers could prohibit their employees from sharing their salaries. They are typically used to stop co-workers comparing their salary deals and pushing for pay rises. As a result of the Bill, employees will be able to ask each other about, and disclose, their remuneration and any associated terms (such as hours of work). Employers will be prevented from entering into an employment contract with an employee containing such a clause.

If you use these clauses, you should review your employment contracts.

Steps to take in the next 3 months

Businesses will have a new obligation to prohibit sexual harassment in connection with work will commence on 6 March 2023

These new provisions will enable harassed workers, unions and the Fair Work Ombudsman (FWO) to obtain compensation, financial penalties and other orders against perpetrators of sexual harassment and businesses who do not take reasonable steps to guard against the risk of sexual harassment.

The definition of ‘worker’ and ‘worker in a business or undertaking’ are broad and have the same meaning as these terms in the WHS Act.

Complementing these changes is:

• the new positive duty on all employers and persons conducting a business or undertaking to take reasonable and proportionate measures to eliminate, as far as possible, unlawful sex discrimination, including sexual harassment.
• the new prohibition on conduct that results in a hostile workplace environment on the ground of sex.

Sexual harassment means when a person makes an unwelcome sexual advance, an unwelcome request for sexual favours, or engages in other unwelcome conduct of a sexual nature in relation to a person,

The circumstances to be considered in assessing whether conduct is sexual harassment are expansive.

An employer or principal of the business or undertaking is liable for the conduct of their employees or agents who breach the prohibition on sexual harassment unless they can show they took reasonable steps to prevent the behaviour.

What should you do?

Review your current policies and procedures in light of the proposed changes, including the positive duty to prevent sexual harassment. It may also be useful to consider if there is is appropriate training that you could recommend that your workers do. Find out more about sexual harassment in the workplace.

Steps to take in the next 6 months

Changes to the process to respond to requests for flexible work requests will commence in June 2023 and require:

• employers who refuse a request to explain the business grounds for the refusal (if any) and how those grounds apply to the request; and
• describe any alternative arrangements that the employer would be willing to make to accommodate the request; or
• state that there are no changes made to the employee’s working arrangements.

In the event of a dispute the Fair Work Commission will be able to determine these matters.

What should you do?

Review how you respond to requests to flexible work arrangements and consider whether any changes need to be made to incorporate the new requirements.

Steps to take in the next 12 months

Limits to the use of fixed term contracts will commence on 6 December 2023.

Under the new arrangements fixed terms contracts for the same role will be limited to two years or two consecutive contracts, including any renewals to the contracts. 

Contracts in breach of this limitation will be unenforceable by the employer, and employees will become permanent employees once the limit is up. There are a number of arrangements that will not be bound by this ‘limit’ including for example:

• Employees engaged to perform only a distinct and identifiable task involving specialised skills.
• Employees engaged to undertake essential work during a peak period.
• Apprenticeships and traineeships.
• If the contract is funded by the government.

Employers are required to provide a Fixed Term Contract information statement to new employees who enter contracts with a fixed term.

If you do engage employees on fixed term contracts HIA recommends you review these arrangements.

What else should you be aware of?

The obligation to provide 10 days of paid family and domestic violence leave will apply to full-time, part-time, and casual employees from February 1 2023 and for small businesses from August 1 2023.