Changes to the Fair Work Act

The gender pay gap remains a significant issue in the world of employment. The latest research from the Workplace Gender Equality Agency has shown that the gender pay gap stopped closing this year, leaving women earning on average $26,596 less than their male counterparts. In an attempt to close this gap, the Federal Government has introduced the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act which received royal assent on 6 December 2022.

The amended legislation introduces key changes to several areas of employment, aiming to help increase transparency in the workplace and combat gender pay discrepancies.

Summary of the Key Changes of the (Respect at Work) Bill

The key changes that have been introduced include:

• Employers will no longer be able to propose contracts including clauses which prohibit employees from discussing their pay;
• Employees will be able to choose whether to disclose or not disclose their wages to their co-workers;
• Job advertisements are not allowed to advertise a wage which is not in accordance with the Fair Work Act or any other Fair Work instrument;
• Employees will now be able to apply for flexible work hours if:
  • they or a member of their immediate family or household are experiencing family and domestic violence; and
  • they are pregnant;
• Employers will have to provide a written response when refusing an employee’s application for flexible work hours;
• Fixed term contracts which outline a duration of two years or more are no longer allowed, and there have been significant changes to regulations regarding fixed or maximum term contracts.

Pay secrecy

Since 7 December 2022, employees have the right to decide whether to disclose or not disclose information regarding their pay, or employment conditions. This also means that it is unlawful for employers to include pay secrecy clauses in employment contracts.

Job ads

Since 7 January 2023, employers are prohibited from advertising pay rates less than the minimal wage. This applies to the minimum wage detailed in any Fair Work instruments such as awards or enterprise agreements, as well as the Fair Work Act.

Employers who are advertising piecework positions are required to either specify the periodic pay rate which applies, or alternatively state in the advertisement that a periodic pay rate will apply.

We note that these changes will apply even if the advertisements were posted prior to 7 January 2023.

Flexible Work

From 6 June 2023, employees will be able to request flexible work hours if:

• they or a member of their immediate family or household are experiencing family and domestic violence; or
• they are pregnant

An employer has a right to deny an employee’s flexible work request. When denying an employee’s request for flexible work hours, employers will be required to provide a written explanation providing reasons as to why the employee’s request was denied, and any other alternatives the employer would put in place to help accommodate the employee’s circumstances.

Should an employee and an employer agree to alter the employee’s working arrangements in a way which differs to what the employee suggested, the employer is required to confirm these changes in writing within 21 days of discussing them.

Fixed term contracts

The law surrounding fixed-term contracts changes on 6 December 2023.

Most notably, employers can no longer employ an employee on a fixed or maximum term contract which runs for two years or more.  Employers are also not allowed to employ employees on fixed term contracts which may be extended more than once.

There are several exceptions to this rule, and it is imperative that employers seek legal advice regarding their use of fixed or maximum term contracts.

What should employers be doing now?

• Employers should ensure they remove pay secrecy clauses from employee’s employment contracts;
• Review any wages contained in job advertisements and ensure they are in accordance with Fair Work Act wage requirements;
• Comply with the new procedures in relation to employees seeking flexible work hours; and
• Seek legal advice regarding their fixed term contracts and considering new methods of contracting.

If you have any questions or require any assistance in relation to the new Fair Work amendments, please do not hesitate to contact Holdstock Law.

For the complete government guidelines regarding these changes, visit: https://www.fairwork.gov.au/newsroom/news/secure-jobs-better-pay/pay-secrecy-job-ads-and-flexible-work

This article was written by student Samiyar Samiee.