With the Australian Labour Party (ALP) winning the recent federal election a change in government will likely see a number of potential changes in Human Resources, Industrial Relations and Employment Law.
Our team at NB Lawyers, lawyers for employers, have looked at some of the commentary, proposed policies and general discussion points made by the incoming government in regards to the workplace and here are some of the potential changes that we might expect going forward.
1. Gig Economy Protections And Casual Employment
Workers in the gig economy, such as ride service app Uber, have seen a number of challenges in regard to “wage payments”, modern awards and general rights under the Fair Work Act 2009 (Cth) (see How To Make A Modern Award? Menulog Attempt To Formalise The Gig Economy Industry – 3 Steps To Consider For Emerging Industries And Employers and The Gig Economy – “Uber” Factors To Consider)
in areas such as:
- termination of employment;
- complaints;
- underpayment of wages;
- sham contracting; and
- general disputes.
It is likely that the incoming government will look at redefining what is an “employee” to encompass gig economy workers. We expect to see organisations in certain industries such as:
- Technology;
- Marketing;
- Construction; and
- Engineering
who regularly engage gig economy workers to be greatly affected by any changes in this area.
There is a general push by the ACTU (Australian Council of Trade Unions) for workers to be employed on a permanent basis.
This push toward permanency is linked to this overall wanting of stability, however it reduces the ability for businesses and employers to have a flexible workforce. For example, seasonal businesses who rely upon transient workforces and those who need specialist workers but cannot afford them on a regular basis such as the creative industries will need to strongly consider the employment contract documents going forward keeping these potential changes in mind.
There is also the potential for “sham contracting provisions” to be further characterised and we will potentially see a further definition of what sham contracting is (see Contractor Or Not A Contractor – Uber Delivers Clarification). There may well be a further hardening of what is a genuine contractor and this will affect companies who regularly utilise contractors in the transport, security and cleaning industries.
Casual Employment has been a much talked about area of law for the last 12 months.
In summary, the decision of the High Court found that:
- A “casual employee” is an employee who has no ‘firm advance commitment’ as to the duration of the employee’s employment or the days (or hours) the employee will work; and
- A firm advance commitment can only be established by considering the binding contractual obligations between the employer and employee – particularly where they have a written contract in place.
See A Change In Casual Employment Post-COVID-19: 3 Major Changes All Employers Need To Know for changes to the Fair Work legislation, namely the following:
The Act provides a clearer definition to casual employment, which states, inter alia:
- A person is a casual employee of an employer if:
- an offer of employment made by the employer to the person is made on the basis that the employer makes no firm advance commitment to continuing and indefinite work according to an agreed pattern of work for the person; and
- the person accepts the offer on that basis; and
- the person is an employee as a result of that acceptance.
The incoming Government are looking at further refining this with a fair, objective test to determine when a worker can be classified as casual, so people have clearer pathway to permanent work.
There has been no clarity as to what this means but it lines up with the view that there should be more secure and permanent work offered as opposed to casual employment being offered along with more pathways to conversion to permanency.
2. General Wage Increases And Wage Transparency
The general consensus is that the incoming government will look to introduce wage increases either through submissions to the Fair Work Commission for the Federal Minimum Wage increase or/and industry modern awards.
There have also been general comments made by the ACTU looking to push for a federal living wage which would be 60 per cent of median wages. This would potentially to be in line with inflation and this would be a great concern to human resources and employers.
The number 5.1 per cent has been put forward as a potential submission but they may soften their stance now. The Fair Work Commission decision on the Federal Minimum Wage is set to affect around 2.6 million workers.
On top of affordability issues and retention and recruitment issues that go with these wage increases, there is a potential likelihood that the incoming government will introduce “same job same pay measures”. This concept looks at two people who work at the same site or the same workplace who do exactly the same work to be paid exactly the same.
This would look at combatting a few issues namely the following:
- Gender pay gap
- Labour hire employees as opposed to employed employees
- Contractors working on site as opposed to employees
- Employees that have parental responsibilities as opposed to those that don’t
This is likely to affect industries such as construction, cleaning, security, hospitality, trades, labour hire, and recruitment in particular.
Much like Modern Slavery provisions, the gender pay gap changes may require reporting by larger organisations, which will lead to those requirements being pushed down through tenders, service agreements, terms and conditions, and contractor reports.
Also, alongside these measures, there is discussion around further amendments to the Fair Work Act 2009 (Cth) to ban confidentiality clauses in employment contracts around wage information which will allow staff to discuss their wages freely. The proposed amendments are based on the thought process of being open and transparent about pay and as such encouraging wage equality through that transparency.
This is likely a way for the strengthening of bargaining and negotiating but from an individual perspective, the ACTU have pointed to the lower pay gap issues in the public sector as an example.
Some states already have “wage theft legislation”, such as Queensland (see Wage Theft – The New Compliance Fear For Employers and Personal Liability Of Directors: 4 Underpayment Of Wages Cases).
A number of companies have already been in the spotlight in regards to Underpayment of Wages for example:
- Woolworths
- Coles
- Subway
- Commonwealth Bank
- Made Establishment (George Calombaris)
- Dominos
- Qantas
- Sunglass Hut
- Super Retail Group
- Bunnings
- Chatime
Most of these Employers have received fines or provided undertakings on the basis of errors when it comes to payment of wages. Wage theft legislation criminalises these breaches.
The incoming Government have flagged that this should be federalised legislation which would look at increasing the penalties for those who have engaged in wage theft – not just companies, but individuals involved in the breach (with criminal sanctions).
These changes will likely require:
- Regular payroll audits
- Auditors to be held accountable for those audits
- Standing agenda items for boards (much like Modern Slavery as an example)
3. Sexual Harassment Changes
The article Sexual Harassment Changes Coming In The Workplace – 4 Changes Indicated By The Respect@Work Report sets out four of the major changes we thought might be coming, with the previous Government accepting 55 of the Respect@Work recommendations.
This did not come to pass.
It is very likely that the incoming ALP Government will utilise a number of those recommendations and in particular the following:
- Positive Obligation On Employers To Take Reasonable And Proportionate Measures To Eliminate Sexual Harassment
- Expansion Of The Definition Of Serious Misconduct Under The Fair Work Act
- Psychological Health Will Become More Prevalent In Workplace Health And Safety
- Judges And Politicians Will Be Subject To The Sexual Harassment Laws
The incoming government will most likely look to utilise those recommendations at a much more optimal level and in particular the practical effect is that the employer will be required to take positive steps to eliminate sexual harassment risks. The word ‘eliminate’ is important as this goes further and beyond those contained in workplace health and safety, which requires taking all reasonable steps.
Eliminating those risks is going to be quite tricky and difficult for some organisations, especially those where the industry has traditionally struggled with a culture of sexualised banter or innuendo.
From the human resources perspective this will likely require the following:
- More specific sexual harassment training
- Specific policies that set out obligations and requirements of sexual harassment
- A cultural “lockdown” industries and areas where traditionally sexually inappropriate behaviour has either been explicitly accepted or impliedly accepted or even ignored
- Investigation obligations that may require more scrutiny and transparency
There are also likely to be dedicated reporting obligations around sexual harassment, much like workplace health and safety, around near misses. This will likely create a scenario where boards and management will have KPIs lined up with the prevention of sexual harassment risks and in particular the issue around psychosocial risks (and how this can be prevented and eliminated).
Much like Modern Slavery provisions the sexual harassment changes may require reporting by larger organisations which in turn will lead to those requirements being pushed down through tenders, service agreements, terms and conditions and contractor reports.
4. Fixed Term Contracts
An interesting point that has been made by the incoming government during the election campaign was the issue around fixed-term contracts. What they may well do is look at ensuring that the maximum a fixed-term contract can be in place for is two years and once that contract is finished that it can only be renewed for another further period. However, the fixed-term contract cannot be renewed a third time.
This may cause problems with employees in positions such as maternity leave cover.
Other Issues
There are other issues such as Enterprise Bargaining reduction in unilateral powers, increased whistleblower protections (with potential rewards for doing so), a crackdown on “start up” enterprise agreements, a code of practice for FIFO workers and abolishing the Australian Building and Construction Commission.
There are expected to be a raft of changes and if you are in a potential vulnerable industry the time to talk to the lawyers for employers is now.
This article originally appeared on NB Lawyers, the Lawyers for Employers, and has been republished here with permission.
Jonathan Mamaril is a Director with NB Lawyers, the Lawyers for Employers, leading the Employment Law and Commercial Law teams. Jonathan assists employers in mitigating risk and liability and advises clients on all aspects of Employment Law. His focus is on being practical and providing value for clients through education and training to help them avoid headaches in the first place; and when a problem does occur, to deal with it properly so it doesn’t become a larger, more litigious problem.