The Labor Government has introduced its new Secure Jobs, Better Pay Bill to the parliament. As its title suggests, the Bill is aimed at encouraging wage increases, and many of the changes are focused on opening up the agreement-making process, which has stagnated in recent years. There are a lot of changes to the Fair Work Act (“FWA”) which are proposed in the Bill. There have already been a few comments made on the changes to agreement-making processes. Here are a few other prospective changes which we thought you should know about:
Flexibility: currently, the FWA provides a right to request flexible working arrangements, but not a right to have them. An employer may refuse by citing reasonable business grounds, and there are no effective means to challenge this. Under proposed amendments, the FWA will provide increased obligations on the employer to consult, provide reasons for a refusal, and to discuss any flexible work arrangements the employer is willing to make. Further, if the employer refuses a request, or does not respond within 21 days, the FWC can step in and resolve the dispute. If the employer refuses unreasonably, the FWC can even order that the employer grant the request or make other changes in response to the employee’s request for flexibility. The flexible work arrangements are part of the NES, contraventions of which can result in a civil penalty under the FWA.
BOOTs: In an effort to increase the use of enterprise agreements and encourage bargaining for increased wages, changes will be introduced making the Better-off-overall Test (“BOOT”) more flexible. The changes will require the FWC to pay more attention to the overall intentions of the employer and employees and what they consider to be beneficial and will not be an exercise in a line-by-line comparison of the terms in the agreement and the terms in the relevant award. As part of the BOOT, the FWC will only consider patterns of work or types of employment that are foreseeable as at the time of the assessment. The BOOT will not necessarily fail because someone raises a scenario that results in an employee not being better off if that scenario is unlikely to occur. The changes also provide for the FWC to take a more cooperative approach to help the parties to “fix” an agreement, rather than to reject it.
Prohibiting pay secrecy: the proposed amendments to the FWA provide that an employee may disclose their salary to anyone, and may request salary information and details of employment terms and conditions from others. Any term in an employment contract will be void to the extent that it affects the employee’s rights to disclose this information under the FWA. We know that this is a fairly common expectation of employers – and often a term in employment contracts.
Termination of expired EAs: Changes to the FWA would make it more difficult for employers to unilaterally terminate an expired EA, especially where the termination and reversion to award conditions would result in a significant reduction in pay.
Fixed term contracts: You may need to reconsider if you rely on fixed-term contracts. Subject to some limited exceptions, fixed-term contracts of 2 or more years, or which are extended more than once, will be prohibited if changes proposed in the Bill are implemented.
It is not certain whether all of these changes will be enacted into the legislation and we await the government’s decision on the proposed changes.
If you would like to discuss these or other workplace issues, please contact Andrew Bland or call 02 9412 3077.